Hurricane Ian and Climate Change Dominate Insurance Conversation

State by state variations of laws, compliance protocols, industry transparency, and general regulatory cultures can lend one the impression that keeping up with industry changes is a little bit like herding cats. So, what better way to wrangle some of the more localized insurance news than in a Regulatory Roundup?

On an ongoing basis, in no particular order or rank, we’re wrestling the various regulatory changes, compliance actions, and commissioner decisions into our roundup. As a disclaimer: There’s a lot going on at any given time in these here United States, so this isn’t a comprehensive picture of state-level action by any means. Think of it as, instead, a sample platter of regulation. 

Also important to note: If we’re recapping interpretations of legal decisions, this is some armchair insurance speculation and not at all legal advice. If you need legal advice, get a lawyer. 

Florida and South Carolina face down Ian

Frankly, these states will likely dominate headlines for months to come as Hurricane Ian is projected to be the most expensive hurricane to date.

After landfall as a Category 4 hurricane in Florida on Sept. 28, 2022, the storm flooded numerous counties, tore through public, personal, and private properties alike, dumping buckets of water on anyone who hadn’t evacuated, and then made landfall again in South Carolina.

The number of dead – more than 100 and still climbing as rescuers find bodies – is record setting, and heartbreaking.

As recovery efforts begin, Florida homeowners insurance companies and other P&C insurers in the region have launched their services to process claims and get adjusters to the affected properties as quickly as possible.

Insurance Commissioner David Altmaier followed Gov. Ron DeSantis’s emergency declaration with an emergency order outlining expectations and announcing emergency measures, such as suspending insurance contract terminations and non-renewals for the time being.

Through the first week of October, insurers had to file daily simplified claims reports from the hurricane, even if they had no properties affected. And the state activated its emergency adjuster licensing processes in order to get insurers’ claims payouts moving as quickly as possible.

Undoubtedly, this catastrophe will worsen Florida’s already-troubled property insurance market, though to what degree remains to be seen.

South Carolina, which suffered its own Hurricane Ian devastation, also issued a bulletin to confirm the state entered an “unusual circumstance/catastrophe insurance declaration.” The bulletin activated emergency adjuster licensing protocols, again aimed at helping the insurance industry move quickly to address the losses of homeowners and businesses in the affected areas.

Washington Office of the Insurance Commissioner hosts Climate Summit Series

The Washington OIC hosted the Climate Summit Series, which started Sept. 26, 2022. This is their third annual series, and the 2021 Climate Summit and 2020 Climate Summit programs are still online for viewing.

The Climate Summit 2022 is a digital summit with videos from insurance regulators, politicians, insurance industry professionals, and climate scientists. With interviews and webinars, the conversation takes aim at not only the human realities of climate change but also its general effect on the insurance industry both for insurance insiders and for consumers overall.

As the commissioners at the NAIC noted, particularly people in coastal states must confront mitigating climate change’s effects with new technologies and building techniques, adapting to it with changes to codes and regulations for zoning and building, and migrate away from areas that have chronic effects. So it’s not a surprise that Washington’s OIC – often on the leading edge of insurance regulatory trends – is pushing debate and education about the effects of climate change on their population and on how various trends connect to certain insurance outcomes, particularly in the personal or property and casualty realm.

To watch Washington’s Climate Summit 2022, click here.

Colorado announced its insurance consumer protection services recovered more than $19 million from insurance carriers for Colorado consumers. Most recoveries come from additional claims payments, overturn of previously denied benefits, or other policyholder refunds or payments. The amount represents a 93 percent increase from the previous year, which the Colorado Division of Insurance attributes to examining claims payouts for homeowners in the wake of the Marshall fires. Improperly denied benefits erode trust in the industry – to be part of the solution, learn how AgentSync can help you quickly onboard adjusters in times of need.

Louisiana Commissioner James Donelon thanked his colleagues in the legislature for passing his reform package designed to prepare the state’s insurance market for future catastrophic incidents.

Maryland, effective Oct. 1, 2022, now requires all carriers (and health maintenance organizations, dental plan organizations, non-profit health service plans, managed care organizations, and third-party administrators) to report data breaches to the state. The rule covers cybersecurity incidents that could improperly expose consumer data to nefarious actors, but will not require reporting for incidental, accidental data breaches where the organization believes the data has been protected, returned, or destroyed – initial cyber event reports can be filed here. This rule seems to follow a similar thread as the federal cyber reporting requirements that became law at the beginning of the year.

Michigan issued a bulletin to notify health care providers and no-fault auto insurers that a recent state appeals court decision, Andary vs. USAA Cas Ins Co, applies certain laws regarding insurance claims for auto accidents retroactively, meaning providers may soon resubmit claims for services they provided in accidents prior to June 11, 2019, to auto insurers.

Washington approved a new rider for medical malpractice insurance at the request of Physicians Insurance A Mutual of Seattle. The rider will allow doctors to use insurance coverage to pay for criminal prosecutions as a result of direct patient care. Specifically, according to Commissioner Mike Kreidler, the rider is designed for doctors who perform abortions on patients from out of state, aiming to pay up to $200,000 to protect the doctors from criminal liability in other states where the procedure is illegal.

While these points of interest aren’t comprehensive, our knowledge of producer license and compliance maintenance is. See how AgentSync can help make you look smarter today.