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What are the NAIC and the SVO?
The NAIC is the National Association of Insurance
Commissioners, a U.S. trade organization located in Kansas City, Missouri.
NAIC provides a forum for the state insurance commissioners to discuss
regulatory issues, recommed model legislation. The organization has no
regulatory powers of its own. Both NAIC and the accreditation process
have come under attack recently because many states have viewed the accreditation
process as a usurpation of legislative powers in each state. Vermont has
been instrumental in seeking a review of the NAIC and the accreditation
process. The model acts are intended to create a more uniform basis for
state regulation. NAIC has recently implemented a state insurance department
accreditation process.
The SVO is the Securities Valuation
Office, a division of the NAIC, located in New York City. The SVO
prepares ratings for all investments that U.S. insurers own for their
portfolios. The ratings are used by the individual insurance departments
when they audit the respective insurance companies. Insurance companies
must pay to have the SVO review and rate each of their securities.
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