Highlights from the NAIC Fall 2025 National Meeting

I. Investment-Related Initiatives and Developments

a. The Valuation of Securities (E) Task Force Holds its Final Meeting

The Valuation of Securities (E) Task Force (VOSTF) is being disbanded at year end and its responsibilities will be divided between three new working groups:

• Invested Assets (E) Working Group (InvAWG), focused primarily on portfolio level analysis
• Investment Designation Analysis (E) Working Group (IDAWG), focused primarily on analysis of individual investments for assignment of NAIC Designations by the NAIC Investment Analysis Office (IAO)
• Credit Rating Provider (E) Working Group (CRPWG), focused primarily on the administration of the Credit Rating Provider Due Diligence Framework once it has been developed by the NAIC’s third-party consultant, PwC, and adopted by regulators

In its final meeting, VOSTF approved a formal amendment to the IAO Policies and Procedures Manual that delays making collateralized loan obligations (CLO) financially modeled securities to year-end 2026. The delay is intended to give the American Academy of Actuaries (Academy) time to complete its work on the CLO risk-based capital (RBC) project (see next sub-section). VOSTF also adopted a 30-day grace period for filing of a CRP’s annual rating update for privately rated securities. Finally, it was reported that, while regulators will have discretion to remove securities from the Filing Exempt (FE) process starting January 1, 2026, the Securities Valuation Office (SVO) system and staffing upgrades needed for the exercise of that discretion are not yet ready.

b. RBCIRE Working Group Receives CLO Sensitivity Test Report; Exposes Proposed RBC Reporting Requirements for CLO

Following the Fall National Meeting, the Risk-Based Capital Investment Risk and Evaluation (E) Working Group (RBCIRE WG) received an update on the CLO RBC Project that aims to update the RBC framework for CLOs and produce associated RBC factors. Individual modeling of CLOs for RBC purposes was scheduled to go into effect at year-end 2025 but was delayed to year-end 2026 for the Academy to complete its analysis. Final CLO RBC factors are expected to be exposed in Q2 2026.

During the December 15 meeting, the Academy advised that key modeling decisions were still under review, but that it anticipates providing a fulsome analysis – including residual tranche results, portfolio adjustment factors, model refinements, potential comparable attributes, and resulting RBC factors – in early 2026. The Academy also provided a summary of sensitivity tests – intended to test the impact of various attributes on a CLO model and an associated RBC charge – conducted on key modeling assumptions/parameters. The sensitivity test analysis was provided as part of a follow-on request from the RBCIRE WG regarding a September presentation of select CLO model assumptions/parameters that could be refined based on their potential impact to C-1 factors.

Sensitivity testing confirmed most baseline assumptions but indicated that a recovery related assumption may depress C 1 risk, while a reinvestment price/prepayment assumption could increase C 1 risk. The Academy outlined two paths:

1. Maintain current baseline assumptions, recognizing that the opposing effects broadly offset and preserve the current timeline; or
2. Obtain additional granular data to refine assumptions, likely pushing the Q2 2026 target back by several months.

The RBCIRE WG directed the Academy to proceed with the baseline assumptions and released the Academy’s Presentation for public comment, with particular focus on calibration of reinvestment price and prepayment. Public comments are due by January 29, 2026.

The RBCIRE WG also voted to expose Agenda Item 2025-22-IRE, which would require insurers to classify long term bonds as either “CLO” or “all other long term bonds” for RBC reporting purposes. The proposal does not change RBC factors or residual tranche structural considerations. Public comments are due by January 29, 2026.

c. RBC Model Governance Task Force Adopts RBC Principles Document

On December 10, the Risk-Based Capital Model Governance (EX) Task Force adopted Principles of Risk-Based Capital Requirements (RBC Principles Document) to establish a framework for the purpose, use and maintenance of RBC requirements. The RBC Principles Document is intended to serve as regulators “guiding North Star” and addresses several considerations, including the purpose of RBC requirements, RBC’s intended use, when regulators should consider amendments to RBC guidelines (including the concept of “emerging risk”), and the concept of “equal capital for equal risk” (ECER). An accompanying Appendix provides additional context, including with respect to secondary (noncore) considerations, a more granular discussion of ECER, and an acknowledgment that RBC usefulness extends beyond the insurance regulatory community.

The Task Force then received an update on the broader RBC Governance Framework workplan, which, in addition to the RBC Principles Document, includes the development of a process document for analyzing RBC adjustments and the compilation of an investment inventory for purposes of conducting an RBC-related gap analysis, which, when finalized, will be considered by the Academy for purposes of recommending asset classes that should receive prioritized review. A timeline is expected to be provided in early 2026.

d. Macroprudential (E) Working Group Extends Comment Period on FABN Reporting Proposal

The Macroprudential (E) Working Group extended the public comment period on a proposal to expand financial statement reporting requirements for funding agreement backed notes (FABNs) to January 26, 2026. The Working Group was expected to refer the proposal to the Financial Stability (E) Task Force and Blanks (E) Working Group, but the referral was delayed while the Working Group considers whether the reporting requirement will extend to funding agreement backed loans. If adopted as proposed, insurers would be required to disclose the total number of funding agreements that support FABN, with more granular reporting of foreign currency denominated funding agreements that support FABN, funding agreements that support repurchase agreements (FABR) and funding agreements that support putable FABN.

The Financial Stability (E) Task Force and the Working Group also exposed the proposed 2025 Liquidity Stress Testing Framework for a 45-day public comment period ending Jan. 26, 2026.

II. Innovation and Technology Initiatives and Developments

a. Ongoing Revisions to AI Systems Evaluation Tool and 2026 Pilot

The Big Data and Artificial Intelligence (H) Working Group conducted a four-hour drafting session focused on revising the second version of its AI Systems Evaluation Tool and discussing the process for piloting the resource as part of select states’ market conduct and financial exams in 2026. The Working Group sought to engage in granular discussions at a line-by-line level to respond to industry feedback and facilitate deliberate and intentional revisions to the Tool’s introduction and instructional guidance, as well as to the four exhibits currently included as part of the Tool. Only the Introduction and Exhibit A were considered during the session, and Commissioner Doug Ommen (IA), who chaired the meeting, indicated that the Working Group would continue progressing a draft and consider holding another meeting in the process of developing the next draft of the Tool. Industry stakeholders sought revisions and changes to clarify key terms and align the concepts and systems evaluated by the Tool with the NAIC Model AI Bulletin, but regulators were reluctant to make sweeping changes to key terms and the structure of the Tool.

There appears to be a push to get the Tool into the field as part of a pilot process, which is expected to involve voluntary participation from a dozen states, with ongoing coordination between those states participating in the Pilot. Commissioner Ommen indicated that Iowa will permit participation on a voluntary basis, but that might not be the case in other states. During the meeting, Commissioner Ommen also reiterated the view of the NAIC that federal efforts to preempt state AI laws would not displace insurance regulators’ authority and jurisdiction to regulate how insurers are using AI. The comments preceded an executive order issued by President Trump on December 11, 2025 that seeks to leverage executive branch agencies in various ways to push back against states’ efforts to put in place cumbersome regulations and onerous obligations on companies innovating with and developing AI.

b. Cybersecurity Event Notification Portal

The Cybersecurity (H) Working Group met to discuss public comments on a project proposal request form that would permit the Working Group to begin building a centralized cybersecurity event notification portal. Working Group Chair, Michael Peterson (VA), framed the conversation by expressing his view that the portal represents the final piece of the Working Group’s larger efforts to support state adoption and implementation of the Insurance Data Security Model Law (IDSM) (#668). These efforts have included the development and adoption of the Cybersecurity Event Response Plan and the IDSM Compliance & Enforcement Guide. The proposal contemplates a push system under which licensed insurers reporting a cybersecurity event would fill out a notification form and select which state insurance departments would receive the notification.

Per the Working Group, use of the portal would be strictly limited to those states that have adopted the notification provisions substantially as provided in Model 668. Chair Peterson rejected commenters’ suggestion to include states that have adopted other cybersecurity event notification laws, citing security and governance concerns where other government agencies would be the recipient of notifications (e.g., the state attorney general) and the added complexity of developing a shared notification form. 

Interested parties expressed concern about the security risks that establishing a central repository of sensitive cybersecurity event related information stored by a third party would pose. Questions were raised about the level of detail that should be provided in response to the notification form and the internal data security controls that the NAIC would have in place to protect sensitive information. The Working Group agreed to revise the proposal to include more detailed technical information related to security (e.g., the intent for SOC 3 reporting) before seeking project approval.

c. Regulatory Oversight of Third-Party Data and Models

The Third-Party Data and Models (H) Working Group met to discuss a draft regulatory framework for third-party data and model vendors which has been exposed for a 60-day public comment period ending on February 6, 2026. The draft framework aims to ensure regulators have timely access to third-party data and models and that third-party vendors have strong governance practices in place to protect both consumers and insurers. The draft framework would apply across all lines of insurance and would implement a third-party data and model vendor registration process. If a third-party data or model vendor is not registered, its data or models would not be eligible for use by licensed insurers in insurance functions with “direct consumer impact” such as pricing, underwriting, claims, utilization review, marketing and fraud detection. The proposed registration process would require a vendor to provide information about its governance program, annually attest that the governance program has been effectively implemented, and provide regulators with access to its data and models on request of the regulator. Notwithstanding the registration process, insurers would remain fully responsible for compliance with applicable regulatory standards (e.g., validating the suitability of a model for its intended purpose, data security). 

d. Privacy Model Law

The Privacy Protections (H) Working Group did not meet at the 2025 Fall National Meeting, but did request—and the Innovation, Cybersecurity, and Technology (H) Committee granted—an extension of time to the 2026 Fall National Meeting to complete its ongoing work to develop an updated privacy model law based on the Privacy of Consumer Financial and Health Information Model Regulation (#672). The Working Group has continued its piecemeal approach to drafting the new model, exposing individual articles of the revised model for public comment. Although significant revisions have been released addressing, among other things, third-party service provider arrangements, consumer rights to access, correct, and delete nonpublic personal information, limits on the sale of personal information, and limits on the use and disclosure of sensitive personal information, several key sections have yet to be fully revised or exposed for comment, including the definitions of key terms. The Working Group has indicated it will seek comments on a fully revised draft after all articles have been exposed separately.

III. Life Insurance-Related Initiatives and Developments

a. Executive and Plenary Adopts Co-YRT Proposal to Address Overstated Reserve Credit Concerns

The Executive (EX) Committee and Plenary voted to adopt a proposal (Proposal) to update the risk transfer rules (i.e., SSAP No. 61 – Life, Deposit-Type and Accident and Health Reinsurance; Appendix A-791, Life and Health Reinsurance Agreements (Q&A)) for reinsurance transactions that combine both coinsurance and yearly renewable term that have interdependent features, including, for example, aggregate experience refund and recapture provisions that only permit recapture by the cedant if both components are recaptured simultaneously. The change is intended to address instances where companies are reporting overstated reserve credit due to a bifurcated risk transfer analysis of the interdependent contracts.

Final approval comes after several meetings to consider an industry proposal that would have secured exceptions for existing contracts, and which ultimately resulted in the Committee slightly modifying the proposal. The amendments contemplated by the Proposal take immediate effect for new/newly amended contracts, with a December 31, 2026, effective date for other existing contracts. Regulators expect to spend time over the next year educating interested parties on how the changes contemplated by the Proposal are to be disclosed and handled.

b. Life Insurance and Annuities (A) Committee Adopts Annuity Best Interest Regulatory Guidance

The Life Insurance and Annuities (A) Committee unanimously adopted an Annuity Best Interest Regulatory Guidance and Considerations document (Guidance) during the Fall National Meeting. The Guidance clarifies supervisory obligations for insurers that issue annuities sold under the best interest safe harbor provided under the Suitability in Annuity Transactions Model Regulation. The Guidance is effective immediately.

c. NAIC Adopts Revisions to AG 49-A

The Executive (EX) Committee and Plenary adopted revisions to Actuarial Guideline 49-A (regarding the application of the Life Illustrations Model Regulation to policies with index-based interest sold on or after December 14, 2020) (AG 49-A). AG 49-A is a regulation that governs the illustrations of Indexed Universal Life (IUL) insurance products. The Guideline aims to provide consistency and transparency in customer illustrations for IUL products by imposing limits on how products with index-linked interest rate enhancements are illustrated. The revisions to AG 49-A include limiting illustrations of index-linked life insurance policies to a table showing actual historical index changes and corresponding hypothetical annual rates of indexed credits using current index account parameters for only the most recent 25-year period (if the historical period is less than 25 years but at least 10 years, the table is limited to the historical period; if the historical period is less than ten years no table can be provided).

d. Life Actuarial (A) Task Force Adopts Revisions to the AG-55 Templates

The Life Actuarial (A) Task Force (LATF) adopted the revised AG-55 Templates during its November 6, 2025 meeting. The AG-55 Templates are a follow-on workstream of Actuarial Guideline 55 that was adopted this summer and requires asset adequacy testing (AAT) for certain designated life and annuity reinsurance transactions beginning as of year-end 2025. The purpose of AG-55 is to enhance reserve adequacy requirements for life insurance companies by requiring asset adequacy analysis use a cash flow testing methodology that evaluates ceded reinsurance as an integral component of asset-intensive business. 

e. Valuation Manual-22 Subgroup Considers Applying VM-22 Framework to In-Force Annuities

In advance of the NAIC Fall National Meeting, the Valuation Manual (VM)-22 (A) Subgroup held five regulator-only calls to discuss company-specific results and perspectives on potential VM-22 application to non-variable annuity contracts that are currently in force. In general, VM-22 is intended to establish a standardized framework for determining reserves for non-variable annuities and represents a significant shift towards a more dynamic approach that integrated actuarial judgement and asset-liability management modeling, moving away from prescriptive formulas. The new framework was initially adopted to apply prospectively, i.e., to new business effective January 1, 2026 (with an option for covered insurers to delay implementation until January 1, 2029). 

As a result of the most recent discussions, the Subgroup developed a draft “VM-22 Inforce Application- Menu of Approaches” (see Attachment Nine) offering seven potential approaches to integrating currently in-force business, ranging from “mandatory application” to “no in-force application.” During the Fall National Meeting, the Task Force agreed to remove the two most extreme options (“mandatory application” to “no in-force application”) and, after additional discussion, agreed to simplify the menu further to propose three or four options, which are expected to be exposed for a 75-day comment period shortly after the conclusion of the Fall National Meeting.

IV. Property & Casualty Insurance-Related Initiatives and Developments.

a. Executive Committee Authorizes Amendments to Model Holding Company Law to Address Reciprocal/Attorney-in-Fact Relationships

The Executive (EX) Committee unanimously voted on December 10 to approve a Request for Model Law Development authorizing the Insurance Holding Company System Regulatory Act (#440) and/or the Insurance Holding Company System Model Regulation with Reporting Forms and Instructions (#450) to be reopened for purposes of clarifying that, “regardless of definitions of control and affiliation, fees charged insurers from the attorney-in-fact are subject to fair and reasonable standards and subject to approval by the Commissioner and under no circumstances should they exceed the cost of such services plus a modest profit” (emphasis added). Use of the term “modest profit” was the subject of a November Financial Condition (E) Committee meeting that ultimately resulted in a vote to replace “modest profit” with “reasonable profit” for purposes of the newly formed Reciprocal Exchanges (E) Working Group’s 2026 charges. However, no corresponding change was made to the Request for Model Law Development, which was approved by E Committee in August. The measure was approved by the Executive (EX) Committee without substantive discussion.

The Request for Model Law Development notes that, if adopted, the contemplated measures will “require all … transactions between reciprocal exchanges and similar affiliated organizations to meet fair and reasonable standards as it pertains to fees charged the insurer for services.” Regulators proposing the measure noted that updates are necessary “to prevent insurers from sidestepping these provisions which could be considered to be excessive if they failed to meet such standards.” Substantive discussion regarding any proposed amendment is expected to begin in earnest shortly after the Reciprocal Exchanges (E) Working Group is constituted and staffed (typically occurring in late January or February).

b. Homeowners Market Data Call Template and Definitions Adopted by Executive and Plenary

The NAIC Executive (EX) Committee and Plenary voted on December 11 to adopt the Homeowners Market Data Call Template and Definitions (2026 Homeowners Data Call), marking a significant step toward implementation. The 2026 Homeowners Data Call is an overhaul of the Property and Casualty Insurance Market Intelligence (PCMI) Data Call that the NAIC issued in 2024 in collaboration with the Federal Insurance Office. While the 2026 Homeowners Data Call is based on the PCMI Data Call, it expands upon it in several significant ways, such as adding and clarifying policy types and requesting additional, more granular, information. 

The NAIC anticipates issuing the data call in early 2026, with submissions due in June. Once finalized, regulators expect to collect data annually and may consider future enhancements to the template. Additional details regarding confidentiality, data sharing and other procedural aspects will be addressed as part of the rollout. Insurers writing at least $50,000 in direct written premium in any year from 2018 through 2025 are expected to receive a request for information.

c. Climate and Resiliency (EX) Task Force Discusses Reorganization and Flood Insurance Blueprint

The Climate and Resiliency (EX) Task Force met on December 9 where it received an update on an ongoing plan to restructure the Task Force to include new charges, a new name (the Natural Catastrophe Risk and Resilience (EX) Task Force), and the addition of two new working groups (the Pre-Disaster Mitigation & Risk Modeling Working Group and the Severe Peril Working Group). 2026 Proposed Charges for the restructured Task Force and subordinate working groups were exposed for a 30-day public comment period ending January 12, 2026.

The Task Force also advised that it is in the process of drafting a Flood Insurance Blueprint intended to achieve several objective related to increasing flood risk awareness, growing private flood insurance options and expanding advocacy for state and federal funding. An initial Blueprint is expected to be developed and finalized in 2026.

V. Other Notable Initiatives and Developments

a. Aggregation Method (G) Working Group Discusses ICS/AM Comparability “Gap Analysis” and Next Steps

The Aggregation Method (G) Working Group met on December 9, where it discussed a timeline for its 2026 deliverables. These deliverables include the review and finalization of the Aggregation Method, ongoing analysis of life insurer sensitivity to interest rate changes, and the upcoming review of US group solvency regulation. These measures are intended to ensure that state insurance regulators’ approach to calculating group capital for internationally active insurance groups (referred to as the Aggregation Method, or AM) provides “comparable outcomes” to the Insurance Capital Standard (ICS) developed by the International Association of Insurance Supervisors (IAIS). A November 2024 IAIS report concluded that the AM provides comparable outcomes to ICS, but identified certain areas – including changes in interest rates and triggers for supervisory intervention on group capital adequacy grounds – where more should be done to ensure convergence of outcomes for US life Internationally Active Insurance Groups (IAIGs).

The Working Group is expected to assess whether there are gaps in the US insurance regulatory framework for purposes of ensuring consistency with the solvency standards outlined during the 2024 AM/ICS comparability assessment. In particular, the assessment will include (i) an analysis of sensitivity to changes in interest rates and their impact on the solvency of the US life groups, (ii) regulatory intervention of US groups on group capital grounds, (iii) the use of scalars and choice of regulatory intervention points, and (iv) reporting and disclosure requirements related to the foregoing issues. The gap analysis will be conducted in the first quarter of 2026 and, to the extent gaps are identified, referrals to relevant committees of jurisdiction are expected to occur during the third quarter of 2026.

b. Statutory Accounting Principles (E) Working Group Releases IMR-Related Proposals for Comment

The Statutory Accounting Principles (E) Working Group exposed two proposals related to interest maintenance reserves (IMR) for a public comment period ending January 26, 2026. The first proposal (Ref #2025-22) requests guidance on whether derecognized net negative IMR should reduce required reinsurance collateral (i.e., be treated symmetrically with positive IMR). The second proposal (Ref #2025-23) is a calculation template to determine (i) whether reporting entities are sufficiently acquiring fixed-income instruments in comparison to their investable premium and sold fixed-income investments, and (ii) if the weighted average yield on the investments acquired is greater than the weighted average yield of the investments sold. Under the proposal, a reporting entity would be required to complete and pass both tests in order to move to a net negative IMR balance (from a prior positive IMR position) and/or increase a prior year net negative IMR balance.

c. Updated Tracker for PE Considerations List

The Macroprudential (E) Working Group released an updated tracker of NAIC initiatives related to the Regulatory Considerations Applicable (But Not Exclusive) to Private Equity (PE) Owned Insurers. The updated tracker indicates that work has been completed for 12 of 22 workstreams. The remaining ten workstreams relate to identifying affiliated/related party transactions, privately structured securities, reliance on credit agencies, pension risk transfer (PRT) transactions and offshore reinsurance.

d. NAIC Elects 2026 Officers

NAIC members elected the 2026 officers during the Executive and Plenary Session. The 2026 NAIC officers are:

• President: Virginia Insurance Commissioner Scott A. White
• President-Elect: Rhode Island Department of Business Regulation Director Elizabeth (Beth) Kelleher Dwyer
• Vice President: Utah Insurance Department Commissioner Jon Pike
• Secretary-Treasurer: South Carolina Department of Insurance Director Michael Wise

The newly elected officers will assume their respective roles effective January 1, 2026.

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