�鶹��ý

On Monday, Aug. 11, �鶹��ý President and North Dakota Insurance Commissioner Jon Godfread delivered the keynote address at the �鶹��ý’s 2025 Summer National Meeting in Minneapolis, Minnesota.

Said Commissioner Godfread:

We’ve now passed the halfway point of our �鶹��ý year. The pace has been brisk. The progress is real and, most importantly, impactful. It has been driven by your expertise, your collaboration, and your commitment to strengthen and modernize our regulatory system. Our theme this year is Securing Tomorrow, and that’s exactly what we’re doing. Not just reacting to challenges but anticipating them. 

****

Good afternoon, and thank you, Commissioner Arnold, for that warm, and very Minnesotan, welcome. Between the lakes, the hotdish recipe, and the crash course in "ope," I think you've ensured this will be one of our most memorable host state greetings. 

And thank you to all of you for being here today. Your collaboration, your commitment to consumer protection, and your tireless work to maintain strong, stable, insurance markets are the foundation of everything we do. This room reflects the best of state-based regulation: local, pragmatic, and grounded in real-world service to real people.

Now, I know what you’re thinking: “Minneapolis? Why not North Dakota?” Believe me, I tried. But a national meeting in Bismarck in August may have been a little too exciting for some. So, here we are, as close to North Dakota as we’re likely to get on an �鶹��ý calendar. We’ll take it!

That said, allow me a rare plug for the Peace Garden State. We may not have a pro sports team or a coastline, and direct flights are more aspirational than reliable, but we do have one of the most fiscally sound insurance departments in the country. We are also the only state with a state-owned bank and a state-owned grain mill: proof that in North Dakota, we believe in free markets... and the occasional government-owned enterprise, if it gets the job done.

We are honored to be in Minnesota, a state with a deep bench of insurance leadership and innovation. Minneapolis is home to some of the country’s most influential insurers, and their partnership is essential as we meet the evolving needs of consumers.

But I would be remiss if I didn’t mention Minnesota’s most meaningful export to North Dakota: my lovely wife, Amanda, who grew up right here in the Minneapolis area.

A special thanks to Commissioner Arnold for being a gracious host and a trusted leader at our table.

We’ve now passed the halfway point of our �鶹��ý year.

The pace has been brisk. The progress is real and, most importantly, impactful.

It has been driven by your expertise, your collaboration, and your commitment to strengthen and modernize our regulatory system.

Our theme this year is “Securing Tomorrow,” and that’s exactly what we’re doing.

Not just reacting to challenges but anticipating them.

Already in 2025:

• We’ve sharpened our communications to better reach consumers, media, and lawmakers. Not for PR’s sake, but to make sure the public understands the real protections our departments deliver every day.
• Across outlets like The Wall Street Journal, The Washington Post, NPR, and Fox Business, commissioners are speaking out: on disaster recovery, mitigation, and consumer protection. Together, we’re making it clear: State-based regulation isn’t just responsive. It’s relevant and essential.
• For example, last month, I had the opportunity to speak with NewsNation about the devastating floods in Texas. And I want to commend Commissioner Brown and her team for their steady leadership in that crisis. In moments like this, we’re not just talking about insurance; we’re giving people tools for resilience.

That is what securing tomorrow looks like: meeting the moment with clarity, coordination, and courage. And we’re bringing that same mindset to the very core of our financial oversight.

Let’s turn to one of the most significant initiatives of the year: the work of the Risk-Based Capital (RBC) Model Governance Task Force.

When we launched this effort, it wasn’t about tweaking a formula. It was about asking a bigger question: Are we governing one of our most important regulatory tools in a way that reflects the reality of how it’s being used and what it’s becoming?

Because the truth is: RBC has evolved.

It was created more than 40 years ago as a blunt but necessary tool to flag undercapitalized companies. And that core function still matters. But today, RBC is doing much more. Not just for us as regulators but across the entire industry.

RBC isn’t a once-a-year number anymore. It’s a year-round lens into solvency. It informs stress testing, shapes conversations with company leadership, lives within ORSA, the Group Capital Calculation, interstate analysis, liquidity reviews, and global supervisory colleges.

For many companies, RBC has become a core part of how they run their business. It’s embedded in capital planning, product strategy, reinsurance design, and pricing models. It’s not just a compliance metric. It’s part of how they manage risk and run their business.

That shift is already happening. Quietly. Consistently. In boardrooms, risk committees, and actuarial models. So, the real question isn’t whether RBC has changed. It’s whether our governance has kept up.

This review isn’t mission creep. It’s model maturity.

The RBC Model Governance Task Force, led by Commissioners Houdek and Ommen and Directors French and Wise, is delivering the framework to match that maturity. Together, we are building a governance structure that brings clarity, transparency, and discipline to a tool that underpins our entire solvency system.

We’re on track to adopt guiding principles by the end of this year. To ensure accountability and to make sure RBC is governed with the same rigor it demands from the companies we regulate.

As we shape these principles, we need to be clear about what RBC is and what it’s not.

Some have argued that RBC should be used to drive product availability or boost global competitiveness. Those are worthy goals, but they are outcomes, not principles.

You don’t build a bridge to sell more cars. You build it to carry the load. To stand strong under pressure. Commerce follows because the structure holds.

When RBC is governed with clarity, it enables smarter product development and stronger global alignment. But if we put the cart before the horse, if we design only based on outcomes and not structure, we risk eroding the very solvency RBC is intended to protect.

Solvency in 2025 is a far cry from solvency in 1985. It’s moving faster, more complex, and deeply interwoven with enterprise capital strategies.

Consider this: Just last week, President Trump signed an executive order directing federal agencies to modernize retirement plan rules and expand access to alternative assets within 401(k) plans.

That move represents a broader market shift. It confirms the growing interest in the types of products insurers are uniquely positioned to offer. But it also raises the stakes for how we evaluate and oversee capital strength. If insurers are going to meet the rising demand responsibly, they will need to refine their capital strategies. And we, as regulators, must ensure the solvency tools we use are equally modern, adaptable, and aligned.

To govern RBC like nothing has changed would be to govern in denial. We have a responsibility to govern RBC as a modern tool. It has become:

• A continuous gauge of capital strength
• A signal to regulators and markets
• A reference point for international coordination, and
• A core element of how insurers manage risks.

If our governance fails to reflect that, we risk fragmentation and irrelevance.

This initiative is about more than solvency. It’s about trust: earned from consumers, companies, and our global peers. And with this work, we’re reinforcing that trust and proving that state-based regulation isn’t just keeping up. It’s leading the way.

Eyes wide open. Principles in place. That’s how we lead.  That’s how we secure tomorrow.

The credibility that strong RBC governance creates doesn’t stop at our borders. It extends to the global stage.

In May, we hosted the International Insurance Forum in Washington, D.C., bringing together global regulators, industry leaders, and policymakers. It was an opportunity to highlight our leadership on tackling resiliency, tech disruption, capital modernization, and investment strategies. 

Our message was clear: The U.S. isn’t reacting to global pressures. We’re defining the path forward. 

As we do that, we’re also advancing our 2025 legislative and regulatory priorities, with real, tangible progress across key areas that I look forward to highlighting throughout this National Meeting.

Mitigation and resilience remain top priorities, because they protect homes, reduce long-term costs, and, most importantly, save lives. Our visit to California was a sobering reminder of what’s at stake. Thank you to Commissioner Lara for convening that discussion and for your leadership on the ground.

Across the country, states are delivering proven programs like Safer From Wildfires, Strengthen Alabama Homes, and MySafe Florida Homes. These aren’t concepts. They are proven to reduce losses, preserve availability, and make communities safer. And we are strongly advocating for the federal support they deserve. Because risk is local, and prevention starts in the states.

This year, we’ve made meaningful strides in Washington, reinforcing the value of state-based regulation while leading on innovation and oversight. A key example: 24 states have already adopted our AI Model Bulletin. 

That progress reflects active leadership and a commitment to putting real guardrails around emerging technologies.

When that leadership was threatened by a proposed moratorium on AI regulation, we acted. Together, we helped remove a provision that would have created confusion and undermined state authority. That’s the power of a coordinated, unified voice.

But we also have to acknowledge the setbacks. Despite strong, bipartisan advocacy, the recent federal budget package came up short, especially on health care. Congress failed to extend enhanced premium tax credits and left reinsurance funding and innovation waiver support in limbo. These gaps will have real consequences, especially for those in the individual and small group markets heading into the next rate cycle.

Even so, we remain committed to advancing policies that protect both affordability and access, from mental health parity enforcement to oversight of Medicare Advantage marketing practices. Because this isn’t just about policy. It’s about people. And the closer regulation is to the consumer, the better that protection will be.

That same clarity of purpose underpins our call to eliminate the Federal Insurance Office (FIO).

Let me be clear: we value federal engagement. Our partnership with the Federal Reserve, which holds true regulatory authority over holding companies and systemic risk, is vital. But we also recognize the U.S. Treasury’s role in international financial diplomacy and market oversight.

But FIO is different. It has no regulatory authority, and it creates confusion, especially overseas. Many of our global counterparts aren’t sure if FIO speaks for U.S. insurance regulation or simply about it. That uncertainty weakens our voice.

Eliminating FIO would not diminish U.S. engagement. It will clarify it. It will reinforce the constitutional, time-tested model of state-based regulation. And it will send a unified message, one grounded in expertise, accountability, and 150 years of success.

That clarity matters, especially as we confront growing pressure points across the system.

Which brings us to one of the most critical, and increasingly complex, areas of our work: reinsurance.

Reinsurance has gone from an occasional topic to a top priority for nearly every department and market. And for good reason. It’s the silent engine of our industry, enabling insurers to write policies in high-risk areas, absorb major shocks, and manage volatility in an increasingly complex world.

That’s why the �鶹��ý has made reinsurance a major focus, across both life and property/casualty, because it sits at the intersection of solvency oversight, market stability, and consumer protection.

At our recent Commissioners’ Mid-Year Round Table, we dedicated a day and a half to examining the growing role of offshore life reinsurance, especially the movement of assets into jurisdictions with differing regulatory frameworks. We heard from regulators, actuaries, and industry leaders about what’s driving this activity, and while some of it is due to regulatory flexibility, much of it is driven by federal tax policy. As state regulators, we don’t control those levers, but the impacts of those tax-driven decisions ultimately land in our markets.

What we do control is solvency regulation. And that’s why we are at the finish line on our Asset Adequacy Testing (AAT), an absolutely critical component of our life regulatory framework. AAT ensures that liabilities are properly supported by assets under a range of stress scenarios and economic conditions. It’s our frontline tool for preventing imbalance, misaligned incentives, and long-term risk to policyholders.

We cannot allow AAT to become a check-the-box exercise. It must be applied rigorously, transparently, and consistently, because trust in our system depends on it.

And that brings a necessary word of caution.

We’re seeing more assets move to offshore jurisdictions that don’t offer the same transparency or oversight as our reciprocal counterparts. That opens the door to regulatory arbitrage, draws increased scrutiny, and weakens the trust that underpins our financial system.

Let me be clear: We are not anti-capital. We welcome innovation and capital formation. But it must be responsible, transparent, and accountable. Trust is the bedrock of our system, and trust is earned through open dialogue and honest oversight.

Unfortunately, not every jurisdiction receiving these assets has earned that level of trust.

We will continue to learn, monitor, and, if necessary, take action to protect the long-term solvency of our system and the interests of consumers. We cannot and will not stand for a lack of transparency or regulatory misdirection.

On the property and casualty side, just a few weeks ago, more than 40 states participated in our P&C Reinsurance Roundtable in Pasadena, co-hosted with Commissioner Lara and the California Department of Insurance.

This was a direct response to the shifting catastrophe landscape, where $40 billion wildfire events, weekly convective storms, and tightening global reinsurance markets are becoming the norm.

The discussions were timely, substantive, and essential. We explored capital trends, catastrophe modeling, market capacity, and the evolving appetite of global reinsurers. We shared insights from frontline communities and wrestled with the growing connection between solvency and affordability.

Here’s the takeaway: That’s what modern regulation looks like.

Showing up, asking tough questions, collaborating across jurisdictions, and strengthening our regulatory tools: This is the work. It’s fundamental to what it means to be a modern regulator. Our meeting in California wasn’t just symbolic. It ensured our decisions on rates, capacity, and market stability are anchored in reality, not theory.

Whether in life or P&C, reinsurance is no longer in the background; it’s central to solvency, affordability, and access. The work we’re doing today will define market resilience for decades to come.

Our responsibility is to meet the market where it is and guide it toward a future that is accountable, sustainable, and worthy of public trust.

Now, to reflect on the progress we've made this year, and what is still ahead, one truth is clear: The strength of our system lies in our unity and shared commitment to serving the public.

From mitigation to AI, from reinsurance to solvency and international engagement, we’ve demonstrated time and time again that state-based regulation is not only effective but essential. 

But let’s be honest: The insurance industry is facing a moment of reflection. Some might call it an identity crisis.

Public perception is strained. Confidence has wavered. Whether it’s consumers, policymakers, or the media—across parties, across platforms—there’s a growing disconnect between what this industry actually does and what people think it does.

And yet, at its core, this industry delivers extraordinary value every single day.

Insurance gives people the confidence to build, to grow, to recover, and to dream again after loss. It protects homes, supports businesses, safeguards incomes, and secures futures. In life’s hardest moments, it offers not just financial support, but dignity. Insurance isn’t just protection. It’s a foundation for our economy, our communities, and the lives we live every day.

But here’s the challenge: When the system works well, it’s invisible.

You won’t see headlines about the widow who got her life insurance check on time, or the small business that reopened after a storm. Those are quiet victories: expected and often unseen.

When success goes unseen, trust wears thin. And in moments of public pressure, you need a reserve of credibility to draw from. If you haven’t built it up over time, there’s nothing to fall back on when it matters most.

That has to change.

We don’t need another mascot or catchy jingle. What we need is the truth, told plainly, confidently, and often.

Because insurance isn’t a pitch. It’s a promise. It’s the quiet force that helps people rebuild when everything falls apart. It’s the safety net beneath tragedy. It’s what lets life move forward, even after loss.

But somewhere along the way, we let entertainment replace explanation. People remember the commercials but not the coverage. They know the jingle but not the value. And when trust is put to the test, that gap becomes a real problem.

That’s why this cannot just be on regulators. Our industry partners must show up, too. Not with slogans but with substance. 

Speak clearly. Own the good work. Correct the record when it’s wrong. And help the public understand the true value of the products that protect them every single day.

Because I see it from my seat. I see the checks that arrive when tragedy hits. I see businesses reopening, families finding their footing again, and futures being rebuilt. I see the good, and I know you do, too.

So, let’s lead with clarity.

Let’s act with integrity.

Let’s speak with purpose.

Because when we do, when we stand together in our mission, we don’t just preserve markets. 

We protect people. We create possibility. We secure tomorrow.

Thank you again for being here. For showing up, for leaning in, and for doing the hard work.

Now, let’s get to it.