Tennessee Insurance Practice Exam

Which organization typically oversees the regulation of insurance companies at the state level?

1. National Association of Insurance Commissioners

2. Consumer Financial Protection Bureau

3. Federal Trade Commission

4. Department of Commerce

The correct answer is: National Association of Insurance Commissioners

The National Association of Insurance Commissioners (NAIC) is the correct organization overseeing the regulation of insurance companies at the state level. This non-profit organization is made up of state insurance regulators from each state, as well as the District of Columbia and U.S. territories. The NAIC develops model laws and regulations that states can adopt to ensure consistent standards across the country, though each state has the authority to enact and enforce its own insurance laws. The other organizations mentioned play different roles. The Consumer Financial Protection Bureau focuses primarily on protecting consumers in the financial sector but does not regulate insurance. The Federal Trade Commission is concerned with consumer protection and antitrust issues, but it does not regulate insurance companies directly. The Department of Commerce, while involved in various economic activities, does not typically oversee the specific regulation of insurance, which is more closely managed by state regulatory bodies through the framework established by the NAIC.