The Office of General Counsel issued the following opinion on August 27, 2007 representing the position of the New York State Insurance Department.
NAIC Model Audit Rule
Has the Department adopted the NAIC Model Audit Rule?
No. As of the date of this letter, the Department has not adopted the NAIC Model Audit Rule.
The question is of a general nature, without reference to particular facts.
New York Insurance Law § 307 (a)(1) (McKinney 2006) and NYCRR, Title 11, Part 83 (Regulation 172) govern the filing of annual statements by insurers with the Insurance Department. 11 NYCRR § 83.2 specifically refers to the use of NAIC - adopted and - published manuals to assist insurers with their required filings.
The Superintendent has broad latitude in establishing the elements of a required annual statement filing. The Department’s practice requires insurers to file the form of annual statement established by the NAIC, along with a New York Supplement. See Office of General Counsel (“O.G.C.”) Opinion No. 99-111 (August 19, 1999).
As of 2010, the NAIC has established new requirements within the Annual Financial Reporting Model Regulation related to auditor independence, corporate governance and internal control over financial reporting.
The Insurance Department has not adopted the new Model Audit Rule as of the date of this letter, and such adoption is not imminent. An adoption would require the promulgation of new regulations, and possibly the enactment of new laws, due to the nature of the new requirements, in the, Model Audit Rule
For further information you may contact Associate Counsel Alexander Tisch at the New York City Office.