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Following
the collapse of insurance industry giant American International Group (AIG),
the National Association of Insurance Commissioners issued a statement—quoting
NAIC president Sandy Praeger—urging that the “conversation should stay focused
on the facts.” This is a laudable purpose. CEI, in forwarding its educational
mission, would like to help clarify these facts. 

In its
released statement, NAIC takes two major insurance trade associations to task
for bringing forward the idea that the AIG collapse justifies the idea of an
Optional Federal Charter (OFC).  NAIC
makes a valid point: AIG’s collapse does not prove that the United States needs federal oversight of insurance
and there’s no way to know for certain if a federal charter would have done
anything to prevent the insurance company’s collapse.  (The insurance trade associations, however,
have never definitively said that it would have.) Nonetheless, remaining
focused on the facts requires an appreciation of those facts. And NAIC, in many
cases, tells only part of the story. An analysis of many of NAIC’s key
statements follows.

Related Files: 20080926 Facts About the AIG Collapse.pdf