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From time to time, the Insurance Compact Office hears from Compacting State regulators or even company filers about issues that are coming up in a state review of an insurance product. In some cases, a Compacting State contacts the Insurance Compact Office about a form or product filed with the Compacting State for review. The filing company informs the Compacting State that the product filed with the state is the same as a product already approved by the Compact, implying that it should not be questioned by the Compacting State.

While the filing company might think the fact of prior Compact approval is helpful or influential to the Compacting State, it might also raise these concerns for the Compacting State:

1)      Why is Compact approval relevant? State filing requirements apply to state filings. Compact Uniform Standards do not apply to state filings.

2)      Why is the same product or form being filed with the Compact and the Compacting State? Is there a loophole or difference in the state filing less favorable   to the consumer? In other words, is the filer filing through the Compact for other states and filing state-by-state in their state because of differences between the standards and state law?

The Insurance Compact Office provides assistance to Compacting States who bring questions and concerns when a filer is pushing state approval relying on the Compact?s previous or contemporaneous approval. There are instances where the Insurance Compact Office or the state may follow up with the filing company to better understand its filing strategy.

The takeaway for filing companies is:

1)      do not assume a state will accept a Compact-approved product?only state filing requirements apply to state filings;

2)      look critically at whether a state companion to a Compact-approved product is necessary; and

3)      plan for responding to questions about the filing strategy and compliance with state filing requirements.

If you have any questions about whether the filing can be made through the Compact, please contact the Insurance Compact Office or utilize the pre-filing communication process.