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Committee approves update to insurance holding company rules to align with NAIC model
Summary
The committee agreed to a committee substitute for Senate Bill 800, updating West Virginia's insurance holding company system regulation to reflect recent National Association of Insurance Commissioners (NAIC) Model Law revisions and voted to report the substitute to the full Senate with a recommendation that it pass.
The Senate Banking and Insurance Committee agreed by voice vote to a committee substitute for Senate Bill 800, an insurance-commissioner-sponsored bill that updates six sections of the insurance code implementing the NAIC Insurance Holding Company System Regulatory Act (Model #440) revisions adopted in 2021.
Counsel said the changes adopt model-led requirements for group capital calculations, filing requirements and liquidity stress tests. The committee substitute primarily incorporates the NAIC model language into state law and makes technical drafting adjustments to fit West Virginia's code.
Insurance Commissioner Alan McVay, sworn in to testify, told the committee both the life-and-health and property-and-casualty guarantee funds are "in very good condition, actuarially very sound," and said the amendments are intended to help the department prevent insolvency and to maintain NAIC accreditation. Counsel said approximately six domestic holding companies might be subject to the stress-test provisions under current conditions.
The bill's changes add definitions, set standards for related-party transactions within insurance holding company systems, require filings of group capital calculations and, where applicable, liquidity stress testing. Counsel said the changes are largely technical and aimed at preserving West Virginia's accreditation with the NAIC so multistate insurers and regulators can rely on the state's solvency regulation.
After brief questions and no amendments, the committee agreed to the committee substitute and voted to report it to the full Senate with the recommendation that it pass. Committee action was by voice vote; no roll-call tally was provided.
