NAIC Proposal Would Require Insurers to Audit TPAs

As the insurance industry turns ever more toward outsourcing functions like specialty underwriting and claim adjusting, the National Association of Insurance Commissioners wants states to keep a closer eye on third-party vendors. The NAIC’s Financial Analysis Working Group, part of its Financial Condition Committee, discussed a proposal at its meeting in Chicago this month to essentially make insurer audits of third-party administrators mandatory. The group recommended that the NAIC study the costs and benefits of tweaking Model Guideline 1090, which covers regulations of third-party ad...