How often must a Commissioner examine each domestic insurance company?

The requirement for a Commissioner to examine each domestic insurance company every five years is based on the need to ensure financial solvency, compliance with regulatory standards, and to protect policyholders. Regular examinations allow the Commissioner to assess the financial health of insurance companies, review their business practices, and ensure they are adhering to applicable laws and regulations.

Conducting these examinations at five-year intervals strikes a balance between maintaining oversight and allowing insurance companies sufficient time to stabilize and implement any necessary changes after previous evaluations. This frequency is designed to ensure a thorough review without imposing an excessive burden on both the regulator and the companies being examined.

The other timeframes of annual, three-year, or ten-year examinations do not align with the regulatory standards set in many jurisdictions, which often specify the five-year interval to maintain effective oversight and consumer protection.