This is the 34th year the NAIC has published its annual Insurance Department Resources Report
The National Association of Insurance Commissioners (“NAIC”) has published its annual Insurance Department Resources Report (IDRR). The Report, released in two separate volumes each year, has been published annually for the past 34 years.
The first of the two-volume report focuses on the resources and regulatory activities of the 56 NAIC-member jurisdictions including the 50 states, in addition to U.S. territories like Guam and Puerto Rico. The report is organized into five different sections:
- Staffing;
- Budget and Funding;
- Examination and Oversight;
- Insurance Producers; and
- Consumer Services and Antifraud.
The following are some of the highlights from the report as it relates to Massachusetts and the rest of the New England insurance marketplaces. The full report which contains many more data points can be obtained from the NAIC.
A snapshot of 2020
The major take-aways from Volume One of the NAIC’s IDRR Report include the following:
- There were 5,929 domestic insurers in 2020, a decrease from the 5,947 companies in 2019.
- The total number of company examinations completed throughout the country was 1,588 in 2020.
- There were 195 liquidations in process by the year-end, alongside 37 rehabilitations in progress.
- Licensed resident insurance producers top 2.3 million individuals and 239,585 entities.
- Non-resident producers totalled nearly 7.9 million individuals and 506,159 entities.
- Revenues increased in 2020, with the total amount collected surging 7.27% to to $29 billion.
- As for consumer complaints and inquiries, state insurance departments received over 246,900 official complaints and 1.3 million inquiries.
Number of Domestic Insurers & Regulated Entities in Mass.
The chart below shows how many Domestic Insurers there are in each state. In 2020, Massachusetts had a total of 78 Domestic Insurers, one less than in 2019. Overall, New England had a total of 400 Domestic Insurers.
Domestic Insurers in both Massachusetts & New England by type:
The following graphs break down the numbers between domestic and foreign insurance in each of the New England states.
| TYPE OF DOMESTIC INSURER | MASSACHUSETTS | VT | NH | ME | CT | RI |
|---|---|---|---|---|---|---|
| Life/Annuities | 16 | 1 | 1 | 3 | 26 | 1 |
| Property/Casualty | 46 | 11 | 49 | 11 | 65 | 20 |
| Health | 13 | 5 | 10 | 8 | 9 | 7 |
| Fraternal | 2 | 0 | 0 | 0 | 1 | 0 |
| Title | 1 | 1 | 0 | 0 | 0 | 0 |
| Risk Retention Group | 0 | 84 | 0 | 0 | 1 | 0 |
| Other | 0 | 7 | 0 | 0 | 0 | 1 |
Foreign Insurers in both Massachusetts & New England by type:
| TYPE OF FOREIGN INSURER | MASSACHUSETTS | VT | NH | ME | CT | RI |
|---|---|---|---|---|---|---|
| Life/Annuities | 342 | 334 | 344 | 355 | 381 | |
| Property/Casualty: | 720 | 757 | 737 | 762 | 766 | |
| Health | 25 | 33 | 4 | 2 | 9 | |
| Fraternal | 15 | 12 | 12 | 35 | 26 | |
| Title | 15 | 17 | 19 | 22 | 19 | |
| Risk Retention Group | 42 | 84 | 81 | 95 | 81 | |
| Other | 38 | 0 | 0 | 0 | 53 |
Trend of Domestic Insurers over the years
Another interesting and informative graph from the report shows the overall trend in the number of domestic insurers across the country since 2012.
2021/2022 Insurance Department Budgets
The Massachusetts Division of Insurance is funded 100 percent by a combination of fees and assessments. For the upcoming year, the projected 2022 budget for the Division is $14,575,751, placing it as the 36th largest state budget, three spots lower than the 33rd position last year.
In comparison, the ten states with the largest insurance department budgets are as follows (in descending order of their 2022 Budget):
| STATES | 2022 BUDGET |
|---|---|
| 1. California | $239,569,000 |
| 2. New York | $159,923,000 |
| 3. Texas | $126,507,580 |
| 4. Florida | $91,234,311 |
| 5. New Jersey | $76,299,000 |
| 6. Alabama | $63,904,890 |
| 7. Illinois | $52,212,700 |
| 8. North Carolina | $51,941,378 |
| 9. Ohio | $43,464,160 |
| 10. Michigan | $41,592,900 |
Revenues for Massachusetts and the other New England states
The Massachusetts Division of Insurance had revenues totaling $630,154,890 in 2020. The breakdown of the Division’s funding and expenses is 80% for Administration and Regulation expenses and the remaining 20% covering Operational expenses. The following is a look at the most recent revenue numbers for both Massachusetts and the other New England states:
| REVENUES | MA | VT | NH | ME | CT | RI |
|---|---|---|---|---|---|---|
| Total Revenues | $630,154,890 | $90,843,265 | $133,910,398 | $105,450,427 | $239,556,927 | $164,290,161 |
| Total Taxes | $420,076,062 | $58,893,907 | $114,966,219 | $87,449,589 | $83,956,216 | $118,454,634 |
| Fees & Assessments Collected | $209,960,633 | $29,707,438 | $18,734,679 | $17,964,022 | $153,868,835 | $2,016,915 |
| Fines & Penalties | $118,195 | $2,241,920 | $209,500 | $36,816 | $153,868,835 | $433,028 |
| Other Revenue | $0 | $0 | $0 | $0 | $0 | $43,385,584 |
Financial, Market Conduct Exams and Formal Hearings
The Massachusetts Division of Insurance completed 129 examinations in 2019; in 2020 it conducted 21 Financial Exams and three Market Conduct Exams for a grand total of 24. The following chart takes a look at Massachusetts as compared to the rest of the New England region.
| STATE | FINANCIAL EXAMS | MARKET CONDUCT EXAMS | TOTAL |
|---|---|---|---|
| Massachusetts | 21 | 3 | 24 |
| New Hampshire | 19 | 10 | 29 |
| Maine | 4 | 0 | 4 |
| Connecticut | 6 | 57 | 63 |
| Rhode Island | 5 | 0 | 5 |
| Vermont | 18 | 1 | 19 |
Insurance Producers
The following charts take a look at the percentage of Resident versus Non-Resident Producers, Licensed Producers/Adjusters, and Actions Against Producers as of 2020, for both Massachusetts as well as for the rest of the New England region.
Resident v. Non-Resident Producers
| STATE | INDIVIDUAL RESIDENT | INDIVIDUAL NON-RESIDENT | BUSINESS ENTITY RESIDENT | BUSINESS ENTITY NON-RESIDENT |
|---|---|---|---|---|
| Massachusetts | 32,615 | 126,627 | 2,346 | 5,312 |
| New Hampshire | 6,501 | 90,947 | 574 | 6,289 |
| Maine | 7,492 | 169,815 | 840 | 6,765 |
| Connecticut | 20,812 | 128,975 | 1,905 | 9,003 |
| Rhode Island | 5,269 | 81,551 | 319 | 3,047 |
| Vermont | 3,055 | 86,293 | 194 | 4,356 |
Licensed Producers/Adjusters
| STATE | PRODUCERS | SURPLUS LINE BROKERS | BAIL BONDS | ADJUSTERS | OTHER |
|---|---|---|---|---|---|
| Massachusetts | 159,242 | 2,357 | 0 | 274 | 6,447 |
| New Hampshire | 97,448 | 2,985 | 0 | 76,655 | 0 |
| Maine | 177,307 | 2,125 | 0 | 16,389 | 45 |
| Connecticut | 159,630 | 2,984 | 332 | 97,903 | 1,483 |
| Rhode Island | 87,444 | 1,826 | 0 | 72,484 | 2,325 |
| Vermont | 87,765 | 1,489 | 17 | 71,124 | 102 |
Actions Against Producers
| STATE | NUMBER OF FINES | AMOUNT OF FINES | NUMBER OF RESTITUTIONS | AMOUNT OF RESTITUTION | OTHER |
|---|---|---|---|---|---|
| Massachusetts | 12 | $12,900 | 0 | $0 | 0 |
| New Hampshire | 10 | $81,000 | 9 | $107,271 | 2 |
| Rhode Island | 0 | $0 | 0 | $0 | 1 |
| Connecticut | 12 | $13,300 | 0 | $0 | 6 |
| Maine | 3 | $52,250 | 0 | $0 | 1 |
| Vermont | 1 | $500 | 1 | $318,250 | 0 |
Consumer Complaints & Inquiries
In addition to the above information, the NAIC also tracks the number of consumer complaints and inquiries state insurance departments have received over the course of the year. The following is a breakdown of the complaints for Massachusetts as well as for the rest of New England in 2020:
| STATE | CONSUMER COMPLAINTS | CONSUMER INQUIRIES |
|---|---|---|
| Massachusetts | 2,005 | 5,000 |
| New Hampshire | 744 | 3,961 |
| Rhode Island | 427 | 214 |
| Connecticut | 4,372 | 13,781 |
| Maine | 450 | 4,820 |
| Vermont | 290 | 2,366 |
