AITC Submits Comment Letter on NAIC Model Unfair Trade Practices Act (“Rebates”)
August 28, 2020
Commissioner Jon Godfread
National Association of Insurance Commissioners
444 North Capitol Street NW, Suite 700
Washington, DC 20001
Attention: Denise Matthews, Director, Data Coordination and Statistical Analysis
Commissioner Godfread:
Thank you for the opportunity to provide public comments on the NAIC’s Section 4(H) of NAIC Model Unfair Trade Practices Act (“Rebates”). This comment letter is submitted on behalf of the American InsurTech Council (“AITC”). AITC is the independent voice for insurtechs, traditional insurance companies and agencies, and other stakeholders sharing common goals and objectives before state insurance regulators and the National Association of Insurance Commissioners, federal and state legislators, other policymakers, the media and the general public.
While AITC remains generally supportive of the changes to section 4(H) of the model concerning Rebates, we write to voice our concern with the proposed change in Section H(2)(e)(1) that would replace “value-added services” with “non-cash products or services.”
These concepts are not interchangeable. “Value added services” relate to products or services provided by an insurance company or producer at no cost, or at a reduced cost, that adds value to the relationship with the insured. The criteria listed in subsection (e)(1) describe what are commonly recognized by the industry and regulators alike as “value-added services.” Such services are different from “non-cash products or services,” which are described in Section H.(2)(f)(1) as “non-cash promotional or advertising items or meals to or charitable donations on behalf of a client. . . .”
Moreover, “value-added services” is an accepted term that is understood by the industry and regulators alike. Replacing the concept of “value added” with “non-cash” is an unnecessary change that detracts from the goal of modernizing regulatory policy regarding rebates and is likely to create unnecessary confusion. We respectfully suggest therefore that this change be rejected and the term “value added services” restored to the model.
Thank you for the opportunity to provide public comments on this important document. We look forward to working with you. If you have any questions please do not hesitate to contact us at the email addresses below.
Respectfully Submitted,
Scott Harrison (sharrison@americaninsurtech.com)
Jack Friou (jfriou@americaninsurtech.com)
The Hon. Thomas Mays (tmays@americaninsurtech.com
JP Wieske (jpwieske@americaninsurtech.com)
Teri Hernandez (thernandez@americaninsurtech.com)
Co-Founders, American InsurTech Council