As revised by the NAIC, the model would have the law follow provisions in the NAIC's Market Analysis Handbook. Insurers had argued that this would deprive them of their right to due process because changes could be made to the Handbook language that altered the law without using the usual legislative procedure.

Insurers had raised concern that NAIC models or changes to models would become defacto law if the NAIC Handbook was referenced in the model and no opportunity to respond is offered when changes were made.

According to the report from the meeting, three options were offered in the latest version of the model: public notice could be given and the opportunity for a public hearing offered; an opportunity for an informational public hearing could be offered if there is a material change to a statute or administrative rule; or, notice and the opportunity for a public hearing would be offered if any changes were necessitated to a statute or an administrative ruling or if a commissioner's actions deviated substantially from NAIC work products.

The model would establish a market conduct framework that states can adopt into law. The issue is considered important by many in the industry because of the possibility of federal oversight of insurance.

Creation of a strong market conduct system is viewed as a way to reinforce the effectiveness of state insurance regulation.