Tennessee: NAMIC Comments on Model Audit Rule

NAMIC submitted comments Aug. 5 to Tennessee Department of Commerce and Insurance on its regulatory adoption of the Model Audit Rule.

In February 2004, the NAIC released model regulation for conduct of annual audits of insurers – more commonly known as the Model Audit Rule. That original proposal included provisions drawn from the federal Sarbanes-Oxley Act of 2002 that were not intended by the Congress for non-public entities including mutual insurers, and that were irrationally expensive, especially for smaller insurers.

Although the original proposal was mitigated by NAMIC and company input and many concerns were abated, there still exists provisions in the model regulation that are SOX- driven and should not be the burden of mutual insurers.

NAMIC’s letter makes several proposals to revise the MAR in Tennessee’s adoption to alleviate concerns about SOX provisions, including management’s report of internal control over financial reporting, implementation timelines, requirements for audit committees, and the year-end date set forth in the Tennessee version.

Direct questions to NAMIC State Affairs Manager Erin Collins.

Posted: Tuesday, August 12, 2008 12:00:00 AM. Modified: Tuesday, August 12, 2008 9:53:40 AM.

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We are 1,400 property/casualty insurance companies serving more than 135 million auto, home and business policyholders, with more than $196 billion in premiums accounting for 50 percent of the automobile/homeowners market and 31 percent of the business insurance market. We are the largest and most diverse property/casualty trade association in the country, with regional and local mutual insurance companies on main streets across America joining many of the country’s largest national insurers who also call NAMIC their home. More than 200,000 people are employed by NAMIC members.