Michael McRaith, the Director of the Federal Insurance Office, has offered useful information regarding the TRIA disclosure notices to supplement the February 6 interim guidance. The interim guidance called for an April 13, 2015 deadline for insurance companies to deliver certain TRIA-related notices to policyholders. During a March 19 conference call with PCI, AIA and NAMIC, McRaith addressed a request made by the three trade organizations for an extension to the April 13, 2015 deadline.
While McRaith refused to issue new guidance that would change this deadline, he told the industry groups that April 13 was not a concrete deadline. He assured them, however, that as long as insurers demonstrate good faith in attempting to meet the requirements of the guidelines, there would be no penalties if the April 13 deadline is not strictly met. McRaith indicated that if a loss does occur and the insurer had missed the deadline, the insurer would be expected to show the Treasury the good faith efforts that it had made to comply with the deadline. He expressed that the Treasury would not require extremely detailed proof, but would likely want to see the types of procedures that the company is using to dispense the disclosure notices as quickly as possible.
All three trade associations indicated that a substantial number of its members had concerns about meeting the deadline. While revised guidance would have been preferable, they noted that McRaith’s clarification regarding the deadline helped to ease some of the worries.
McRaith also addressed a question that was raised regarding Guidance One of the February 6 interim guidance. Specifically, he advised the deadline in Guidance One, April 13, means that updated policyholder disclosure notices are required to be supplied only for coverage offers made on or after this date. As it had previously been understood that this requirement applied as of January 12, this clarification will help take some of the burden off of insurers.
Visit our Insurance & Reinsurance Blog for the latest news and developments.Visit the blog
Sign up for our newsletter and get the latest to your inbox.