Which statement about examinations is NOT correct?

• A. The expense of examination of an insurer or of any person is paid by the Department
• B. The insurer pays the examination expenses
• C. Examinations may be conducted by the Department
• D. The costs are regulated by statute

Answer: (A)

The key idea is who bears the cost of regulatory examinations. Examinations of insurers are carried out by the regulator, but the expense is charged to the entity being examined—the insurer or the person examined—not paid by the Department. Statutes set how these costs are assessed and indicate that the examined party is responsible for the expenses, with the Department authorized to conduct examinations and to assess costs within the statutory framework. So the statement that the Department pays the examination expenses isn’t correct, while it is correct that examinations may be conducted by the Department and that the costs are governed by statute.