1 September 2021ArticleAnalysis

The regulator’s role

“People seeking a career that involves helping others may want to consider positions such as the insurance communication specialist.” Debbie Walker, North Carolina

Insurance companies in the US are subject to regulation under the laws of the individual states in which the insurance companies are granted authority to operate. As such, each of the state’s laws and regulations provide the legislative framework by which insurers must abide.Each state has a department or a section of its government, headed by an insurance commissioner or similar position, who is responsible for the regulation of insurance through the enforcement of the state’s laws.For instance, in the state of North Carolina, insurance companies and agents and other related entities are regulated by the North Carolina Department of Insurance (Department), which is headed by Commissioner Mike Causey.The purpose of the state insurance regulator is to protect insurance consumers. This is accomplished in part through the regulation of the financial solvency of insurers to make sure they are compliant with the state’s financial requirements and can pay claims and meet policyholder obligations.Additionally, the regulator regulates the market conduct of the insurers to ascertain the insurers’ compliance with laws addressing the products issued and the fairness of actions in the marketplace by the insurers.This regulation includes but is not limited to the licensing of insurers and producers; the ongoing financial monitoring of the licensed insurers; review and approval of the insurers’ insurance products, including the forms and rates; the ongoing evaluation of the insurers in the marketplace; consumer services, including assistance regarding complaints and inquiries; and investigations of the criminal conduct of insurers, producers, policyholders, and others.For the regulator to meet its responsibility, employees with a wide range of education, experience, skills, and abilities are needed to effectively carry out various functions.Regulatory positions include financial analysts and examiners, actuaries, producer licensing and communication specialists, producer investigators, consumer service representatives, market analysts and examiners, policy and rate analysts, attorneys, criminal investigators, and others.Non-regulatory positions including administrative assistants, accountants, human resource personnel, IT personnel, accounting and budgetary personnel, public information officers, writers and graphic designers, and legislative liaisons.Analysts, examiners and actuaries
Positions such as financial analysts and examiners are utilised by the regulator to regulate the financial health and compliance of licensed insurance companies.The regulator determines whether an insurance company’s licence application is acceptable and if a licence will be issued to the insurer.Following licensure, on an ongoing basis, the analysts and examiners monitor the insurer’s financial solvency and compliance. The analysts and examiners conduct their responsibilities through the financial analysis, audit, and evaluation of documents filed with or obtained by the regulator.These reports include annual and quarterly financial reports, audit reports, actuarial opinions, and other supplemental filings. Other information is provided by insurers upon direction by the regulator during its analysis or examination. This information is evaluated to determine if the insurer is operating in accordance with licensing requirements and the insurance laws of the state.If financial or compliance issues are noted, the regulator determines the next regulatory action that is necessary. This could range from the monitoring of issues noted or obtaining more information to stronger actions such as the placement of restrictions on the operations of the insurer or even the suspension of an insurer’s licence.Typically, financial analyst and examiner positions require a bachelor’s degree with an accounting concentration with experience in auditing, analysis, or accounting. Professional designations, such as the Certified Public Accountant, Certified Financial Examiner, and/or Associate in Captive Insurance designations are preferred.The job outlook in the regulatory environment for persons with these qualifications is positive as the hiring environment is currently very competitive among employers.Actuaries have several regulatory roles, but they are primarily responsible for determining the insurers’ compliance with actuarial-related statutes, assessing proposed rates, forms and statistical filings, and assisting in financial examinations and financial analyses to determine if insurers will be able to meet their obligations.Actuarial regulatory positions require a bachelor’s degree, typically in math, actuarial science, or some other analytical field. To become certified, actuarial candidates must pass a series of actuarial exams that generally take at least 10 years to finish.Regulators typically hire actuarial students who have passed a few exams, and then allow study time at work so that they can pass the exams necessary to become certified. There is a positive outlook for persons seeking a profession in the actuarial science field as the need for qualified actuaries is growing.The regulation of licensed insurance agents, brokers, appraisers, adjusters, and other related entities is an important function of the regulator.This may include pre-licensing education and continuing education for producers, conducting agency investigations, and taking administrative and regulatory actions as required so that insureds and those seeking insurance are provided accurate information and guidance by producers. Positions that conduct these responsibilities include licensing and communication specialists and agency investigators.Additionally, complaint analysts are utilised to address complaints and enquires received regarding producers and others. These positions require professionals skilled in analysis, research, and documentation with an understanding of the relevant state laws and rules. These positions require good communication, customer service, and decision-making skills with the ability to work independently.The education and work experience requirements generally include a bachelor’s degree in business, economics or a related programme and minimal experience in policy and rate examinations, underwriting, claims adjusting work, or financial/marketing analysis; or an equivalent combination of education and experience.Additional coursework such as the Chartered Property and Casualty Underwriter or the Fellows of Life and/or Health Management is recommended for people in this position.Additional opportunities
Consumer services is a key function of the regulator. The professionals providing these services receive complaints and enquiries from the public about insurance companies and other regulated entries. Insurance communication specialists assist and respond to questions and concerns about insurance products and educate, advise, and acquaint consumers with the proper course of action they should take to pursue resolution of an insurance problem.Insurance complaint analysts review and analyse complaints relating to myriad issues such as premiums, policy cancellations, claims and issues relating to coverage to determine adherence to applicable statutes, regulations, and policy provisions.This functional area of the regulator may produce and disseminate consumer information to educate and empower consumers with respect to their insurance products and transactions. For instance, consumers may contact the Department’s consumer services division for assistance with locating a lost life insurance policy.People seeking a career that involves helping others may want to consider positions such as the insurance communication specialist and the insurance complaint analyst. The general educational and work experience requirements are a bachelor’s degree (preferred) with insurance industry experience.The regulator also employs market analysts and examiners to monitor the market conduct activities of licensed insurance companies according to state laws.The purpose of these positions is to determine whether the insurers are conducting themselves properly in the marketplace. For instance, are the premiums charged by insurers fair and reasonable? Also, these analysts and examiners assess the actions of insurers to determine if the insurers are acting fairly and in accordance with the insurance laws of the state other than those that relate to financial solvency.Policy and rate analysts review policy form and premium rate filings to determine if those filings meet the requirements of the insurance laws and, if so, approve them for use so that they can be marketed and made available to the state’s consumers.For positions such as market analysts and examiners, as well as policy and rate analysts, persons hired for those positions will likely possess a bachelor’s degree and experience in policy and rate examinations, underwriting, claims adjusting, or financial/marketing analysis or an equivalent combination of training and experience. Knowledge of life and health, property and casualty, and/or managed care products is also helpful.Regulatory attorneys assist other operational areas of the regulator to determine the appropriate regulatory actions to take against insurers, producers, and other regulated entities; provide guidance on the statutes and rules to be enforced; and represent the regulatory body at hearings regarding insurance rates and other matters.Another interesting and important area of state insurance regulation involves criminal investigations. The regulator may have criminal investigators on staff who conduct investigations of insurance-related crimes or fraud committed by policyholders, claimants, insurance producers, insurance companies, and others. Those interested in seeking a career in criminal investigations need a combination of a bachelor’s degree and law enforcement experience.The operations of the regulator are supported by staff from other professional areas as well. Persons educated in the fields of information technology, law, human resources, accounting and budgeting, public information, graphic design, and other areas are important to the regulator’s day-to-day operations.The ability of the state insurance regulator to meet its regulatory responsibilities hinges on its ability to hire and maintain a full staff of experienced, qualified employees from a diverse range of professional fields.Today many regulators are experiencing an ageing workforce that is approaching retirement. As a result, the job prospects for younger talent in the coming years look very positive.Benefits of working for a state insurance regulator include job security—especially during economically trying times—work/life balance; and benefits such as retirement and health insurance.Those interested in providing service to others, protecting policyholders, and assisting others with their insurance concerns should consider a career with a state insurance regulator.