Insurance Regulatory Information System

Updated: 09 June 2023

What Does Insurance Regulatory Information System Mean?

The Insurance Regulatory Information System (IRIS) is a mechanism the National Association of Insurance Commissioners (NAIC) developed to help states assess the financial condition of insurance companies. Regulators primarily use it to keep tabs on insurance companies to make sure they are not in danger of becoming insolvent and thus cause large numbers of people to lose insurance coverage.

Insuranceopedia Explains Insurance Regulatory Information System

Improving the efficiency of insurance regulation, IRIS is largely comprised of databases and analysis tools. It goes through the financial information insurance companies are required to submit and calculates various ratios designed to assess liquidity and solvency. It establishes acceptable ranges, and companies who fall out of that range may be placed under their local regulator's supervision. Nevertheless, an insurance company may fall outside of the acceptable ranges for one or more ratios without being in financial trouble because some factors are outside of their control. Overall, IRIS reports supplement each state's database and indicates how insurance companies fare against one another.

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