NAIC Launches New Regulatory Wing on Market Conduct Oversight

Formation of the New Regulatory Unit

Members of the National Association of Insurance Commissioners’ Market Regulation and Consumer Affairs (D) Committee appointed the Market Conduct Regulation Modernization (D) Working Group and adopted its charges at the 2026 NAIC Spring National Meeting. The inception of this working group came in February at a commissioner-only conference to discuss the initial framing and charge of the working group.

At the Spring National Meeting, committee chair Ann Gillespie of Illinois outlined the scope of the working group, which is to assess “the current state of the market conduct regulatory framework and the need for changes in response to changing markets, business models, and consumer expectations.” She indicated that the group is open to all jurisdictions, though the initial members include Illinois and Missouri as chair and vice chair, respectively, Alaska, Arkansas, Idaho, Michigan, Minnesota, Nebraska, Nevada, New Hampshire, Pennsylvania, Rhode Island, South Dakota, and West Virginia.

Gillespie then outlined the areas that the working group would initially operate within its regulatory unit, based on an internal poll conducted during the initial planning intake session. The listed areas include the following:

• Market Conduct Data
• Collection
• Analysis
• Interstate Collaboration
• Analysis
• Examinations
• Examination of Handbook and Approaches
• NAIC Support and Systems
• Training
• Other Entity Oversight

Gillespie stressed that the initial list was just the first set based on commissioner observations and that more could be added. She further explained that 2026 will be used for early-stage review and input gathering, with the hope that 2027 will be used for implementing the techniques identified in 2026.

Commissioner Doug Ommen of Iowa inquired as to the group’s plans regarding lines of business, as a parallel effort is currently in development within the A Committee. Gillespie replied with a unique plan to first investigate particular topic areas and then zero in on how those topic areas apply to a particular line of business.

Initial Operations

Following the committee’s meeting at the Spring National Meeting, the working group had its first meeting in April, where it fleshed out the project timeline, along with the overall plan of action. Gillespie explained that the goal moving forward is to have meetings with a biweekly cadence, with the majority of these meetings being for regulators only. However, interspersed with these regulator-only meetings, the working group would provide periodic reports to apprise the public about what progress is being made behind the curtain. The initial timeline of events is as follows:

• April/May: Overview of NAIC Data Analytics Tools and Resources (Regulator Only)
• May/June: Industry Group Input of Initial Areas of Exploration, specifically Property and Casualty, Health, Life, Insurtech, and Specialty Lines
• May/June: Consumer Board and Liaisons Input on Initial Areas of Exploration
• June/July: Interstate Collaboration (Regulator Only)
• June/July: Market Regulation Handbook (Regulator Only)
• July/August: Training (Regulator Only)
• July/August: Third-Party Oversight (Regulator Only)

The working group has planned its initial three meetings for April 22, May 11, and May 26. Gillespie also indicated that consumer advocates would have an opportunity to present information as well, so that regulators could get a clinical readout from all participating stakeholders. Some regulators questioned how much support the NAIC would provide for this endeavor, indicating that the working group would need support similar to what financial condition examiners get to ensure the project gets off the ground.

The group hopes to have final recommendations on the additional work needed for implementation by the NAIC Fall National Meeting, with the expectation that specific detailed changes will occur beginning in 2027 as the working group moves toward full operational readiness.

This article was co-authored by Carlton Fields law clerk Jake Heiges.