But one of the main points to come out of the budget conference call was that hard economic times are whittling away at staff in the industry as well as the budgets of state insurance departments.

Insurers are hoping to limit the NAIC's budget given the fact that "the insurance industry is facing revenue constraints," noted Deirdre Manna, vice president-industry, regulatory and political affairs with the Property Casualty Insurers Association of America (PCI), Des Plaines, Ill.

Insurers have to "service their customers and clients with less," she continued. And, with industry layoffs, employees are being forced to do more than one job, according to Ms. Manna.

The issue of multitasking is being raised by insurers as the NAIC considers a budget line item of $540,000 for an international liaison director.

Commissioner Sevigny argued that the position is needed so the United States will have daily representation as new global insurance and financial services laws are shaped.

And Jane Cline, NAIC vice president and West Virginia insurance commissioner, referred to major projects that the United States needs to participate in including Solvency II, a global solvency regulation system that is being created. Some travel costs currently incurred by the NAIC could be limited by establishing this international liaison position, said Sandy Praeger, NAIC president and Kansas insurance commissioner.

The NAIC should be involved in policymaking of insurance regulation on an international level, agreed Phil Carson, assistant general counsel with the American Insurance Association, Washington. But he added that the benefits received also have to be compared with the costs in that budget item.

"Is the person a reporter and gadfly, or an advocate for the NAIC?" asked Bill Boyd, financial regulation manager with the National Association of Mutual Insurance Companies, Indianapolis.

Mr. Boyd said NAMIC favors state regulation and realizes that the NAIC needs the resources to continue to regulate so regulation does not pass to the federal government. But he asked that resources also be deployed economically.

A discussion of $168,000 in travel expenses set aside for insurance commissioners and their departments in the NAIC budget also raised questions among industry representatives and underscored the new reality of tight state budgets which are prompting some governors to order severe limits on any travel by state employees.

Tom Sullivan, Connecticut insurance commissioner, said that in his state, Gov. Jodi Rell, R, had instituted a travel ban for all public officials and that he had to "beg, borrow and steal" in order so that he and four Connecticut Insurance Department regulators could attend the fall NAIC meeting.

Utah Commissioner Kent Michie noted that "states are really hurting." He said that he had just had a big session with Utah's budget director, "and we're going to be cut short on travel."

There is a need for a budget line in the NAIC budget, he added, because "one of the beauties of the NAIC is the depth of professional [state] staff." The NAIC depends on state insurance departments' staffs to help complete its work, Mr. Michie said.

Other issues raised during the budget hearing included a discussion of a national catastrophe model that is being considered. Trade group representatives said that although the current line item is small, there is concern that because the project is a potentially huge one, the budget for it could increase dramatically in future years.