How often is the commissioner required to examine the books and records of an insurer?

The requirement for the commissioner to examine the books and records of an insurer at least once every five years is grounded in the need for regulatory oversight to ensure the financial solvency and compliance of insurance companies. This periodic examination serves several crucial purposes: it verifies that insurers are operating within the laws and regulations set forth by the state, assesses their financial health, and protects policyholders' interests by ensuring that the insurer is able to meet its obligations.

Five years is a reasonable timeframe that balances the need for oversight with the operational realities of insurance companies. Conducting examinations too frequently could impose a significant administrative burden on both the insurer and the regulatory body, while allowing longer intervals could risk allowing financial or compliance issues to develop unchecked. Therefore, the five-year requirement supports a system of checks and balances that promotes stability in the insurance market.