Who primarily regulates the insurance industry?

The insurance industry in the United States is primarily regulated at the state level. Each state has its own insurance department responsible for overseeing the insurance market, ensuring that insurers comply with state laws, and protecting consumers by maintaining fair practices. This state-based regulation allows for tailored approaches that can accommodate the unique needs of different local markets.

While the National Association of Insurance Commissioners (NAIC) does play a significant role in providing a framework for insurance regulation and helping to harmonize regulations across states, it does not have regulatory authority itself. The NAIC serves as a support organization that facilitates cooperation among the states but does not regulate insurance directly. Similarly, while the federal government has taken steps to regulate certain aspects of the insurance industry (such as in the case of health insurance) and can influence insurance policies, the fundamental regulatory framework rests with the individual states. Private insurers, on the other hand, are the entities providing insurance products and do not have regulatory authority over the industry as a whole.