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- The NAIC expects expenses to increase 5.5% to $204.1 mn in 2027, against projected operating revenue of $191.5 mn.
- Investment income of $7.7 mn will help fund operations, although the proposed budget still anticipates a $4.9 mn shortfall.
- Spending priorities include regulatory data systems, cybersecurity, financial examination training and technology modernization.
The National Association of Insurance Commissioners (NAIC) has proposed a $204.1 mn budget for 2027, representing a 5.5% increase from the previous year, as insurance regulators face greater demands associated with artificial intelligence, increasingly complex insurer investments and expanding technology requirements.
Operating revenue is projected to grow 3.7% to $191.5 mn, according to the NAIC’s budget proposal. The organization expects an additional $7.7 mn in investment income, leaving a projected budget shortfall of $4.9 mn.
Personnel expenses, including salaries, payroll taxes and employee benefits, account for the largest share of planned spending. The NAIC employed 583 people as of August 31.
The association attributed rising costs to growing regulatory data requirements, cybersecurity risks, more frequent natural catastrophes and insurance markets operating increasingly across state and international borders.
NAIC prioritizes financial regulation and technology upgrades
The proposed budget includes investments in regulatory infrastructure and data management, including developing a more authoritative source of insurer and contact information to support the Financial Data Repository.
The NAIC also plans to modernize the System for Electronic Rate and Form Filing (SERFF), which supports regulatory reviews of insurance rates and policy forms.
Another initiative involves collaboration with the Society of Financial Examiners to expand online training and professional credentials for financial examiners and insurance regulatory specialists.
Additional funding would strengthen financial regulation, technology and platform support, member services, education and business operations.
According to the NAIC, these investments are intended to address increasing workloads, improve service delivery, support technology implementation and develop specialized capabilities for state insurance regulators.
The NAIC invests thoughtfully in shared resources, technology, and expertise as we support state insurance regulators. This budget focuses on modernizing critical systems, strengthening capabilities, and delivering practical value to our members, all with a commitment to financial discipline.
Jeff Johnston, NAIC CEO
The proposed spending increase reflects the additional technical and operational resources the NAIC expects to require in 2027, with investments concentrated on shared regulatory systems, financial supervision and professional training.
