With the evolving nature of proposed federal regulatory initiatives, coupled with the high level of state regulatory activity this year, insurance companies need to make sure their compliance-related investment dollars are focused on tools and solutions that will meet or exceed existing requirements, as well as the types of new standards of transparency and reporting being discussed. Technology should enhance the probability of successful identification of compliance risks, which in turn minimizes the costs associated with noncompliance.
Insurers need tools that not only help them identify and understand compliance content that affects their business but also manage the process of implementing regulatory change. These tools should also provide insurers the ability to document to regulators that they have systems and controls in place to ensure compliance with requirements. Key technologies to consider for obtaining solid yields on compliance investments and meeting these challenges are those that inherently provide insurers consistent and timely monitoring of proposed and effective regulatory data, as well as accurate control of the transparency and reporting requirements that could become effective in federal initiatives.
Monitoring and tracking tools -- key elements of a system permitting required transparency and reporting -- can easily be positioned to address other compliance requirements at state and federal levels, including policy replacement and claims processes. Additionally these tools can be successfully used in the implementation of operational changes that are unrelated to current or future mandatory requirements, such as establishing best practices solutions for underwriting.