Regulatory Roundup: Florida CE Extension, Washington Jurisdiction Dispute, Bomb Cyclones

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 postpones CE deadlines

With a shifting insurance market, tragic hurricane season, and an unexpected rash of winter storms, as well, Florida’s insurance agents have had a lot on their plates. To lighten their loads, the Florida Office of Insurance Regulation (OIR) announced agents with continuing education (CE) credits due September through December, 2022, would have an additional three months to complete their CE.

• Sept. 30 compliance dates extended until Dec. 31, 2022
• Oct. 31, 2022, compliance dates extended until Jan. 31, 2023
• Nov. 30, 2022, compliance dates extended until Feb. 28, 2023
• Dec. 31, 2022, compliance dates extended until March 31, 2023

This is particularly relevant given that Florida issues perpetual licenses, meaning that licenses never expire. Instead of applying for renewal, insurance producers’ gauge of whether their license is up to date is based on whether or not they have completed their required CE.

This extension effectively lengthens the affected producers’ license periods for this cycle, as well. If you’d like to learn more about the wackiness of state-by-state licensing nuances, check out our Compliance Library.

Washington Department of Insurance orders Sovereign Nations Insurance to stop sales

In a fascinating case of jurisdiction, the Washington Department of Insurance ordered Sovereign Nations Insurance to stop selling policies in that state. 

The Washington DOI asserts that the state has the authority to regulate insurance sales, and that Sovereign Nations Insurance sales aren’t legal in the state. 

A Sovereign Nations Insurance (SNI) webpage said the company is an inter-tribal association that provides insurance to tribe members and non-tribal people who become members of the Native American Restoration Association (NARA). 

According to a FAQ page on the Sovereign Nations Insurance site, the company answered the question “How is this legal?” by invoking tribal sovereignty: “… Federally recognized Tribes have inherent sovereignty, which means they have the right to make their own laws and govern themselves. The Federal government has enforceable legal obligations to encourage and facilitate Tribal self-sufficiency through economic development. The Tribes participating in SNHC [the Sovereign Nations Health Consortium] have exercised that sovereignty to create and operate SNHC, SNI and NARA.”

The webpage included logos representing the Shivwits Band of Paiutes, Goshute Indian Reservation, and Kanosh Band of Paiute Indians, and said it has offices in Utah.

A notice from Commissioner Mike Kreidler invoked the McCarran-Ferguson Act in establishing the state’s right to order SNI to desist, and said the Washington DOI prided itself in working with state tribes. Kreidler said after determining SNI plans don’t meet Affordable Care Act standards and violate state law regarding waiting periods, he met with representatives from the tribes in Washington in order to gain input from them on SNI’s business.

“We had thorough, productive discussions with tribal representatives before making any decisions,” Kreidler said. “After those meetings, I’m confident in the action we’re taking.”

SNI has 90 days from Dec. 22, 2022, when Kreidler’s office issued the order, to respond to the DOI and request a formal hearing.

Winter Storm Elliot wreaks havoc on U.S. infrastructure 

Winter Storm Elliot (Dec. 21-26, 2022) caused more than $5 billion in insurance losses across 42 states, according to Karen Clark & Co.’s modeling, as reported by PropertyCasualty360. While each seasonal cycle sees states brace for hurricane and tornado season, this year’s winter serves as a grim reminder that disasters aren’t limited by calendar dates.

In Buffalo, New York, more than three dozen people died as snow drifts trapped people in cars, caused auto crashes, and pushed people into cardiac arrest while shoveling snow. In New York, New York, police conducted more than 500 snow rescues of people trapped in buildings or cars, piled in by snow.

In addition to the tragic cost of human life, the storm, dubbed a “bomb cyclone” by weather people who apparently aren’t satisfied with the scale of drama Mother Nature brings all on her own, brought freezing temperatures and blizzard conditions to areas that historically don’t drop below freezing, or that only get an inch of snow in any given year (like Florida).

And, where there’s abnormal weather conditions, there’s often insurance claims. Likely, the estimated $5.4 billion in insurance losses will be due to paying for the fallout of burst pipes and failing infrastructure.

Other state regulatory changes

Delaware passed a law that will, beginning in 2024, require individual and group health insurance coverage to limit costs to consumers at $35 per month per individual for diabetes-related treatment beyond insulin. This includes deductibles and cost-sharing, but won’t apply to high deductible health plans.

Washington has adopted amendments to the state’s health insurance consumer protection laws to bring them in line with the federal No Surprises Act, which took effect in 2022. The new Washington implementation rules attempt to make rights and responsibilities more explicit to all parties, from providers to patients to insurers.

Michigan’s Department of Insurance and Financial Services under Director Anita Fox announced the Freedom of Information Act allowable copy charge, a charge which also applies to home and auto insurance companies requested to provide rate and eligibility documentation: 10 cents per sheet through Dec. 31, 2023. The Michigan DIFS allows insurance applicants who believe they were improperly denied insurance or charged unfair premiums to request insurers for copies of relevant documentation the insurers used to determine the rate or eligibility. The state also passed solvency reforms that put its capital calculations in line with those recommended by the National Association of Insurance Commissioners (NAIC).

California reminded everyone that, with the new year, the California Department of Insurance under Commissioner Ricardo Lara now requires all digital communication, including emails, to include the license number of the associated insurance producer as well as an agency number if relevant.

Louisiana has issued a handbook designed to help insurance adjusters and insurance carriers that employ them in the state to understand Louisiana laws about filing catastrophe and emergency claims. Adjuster laws are notoriously varied across the states. One example: Louisiana doesn’t require staff adjusters (adjusters employed by an insurance carrier) to have a license in the state for emergency claims reporting, but does require insurance carriers to register the staff adjuster with the state DOI. Adjusters may not register themselves for catastrophic or emergency claims.

Colorado issued an emergency rule directing insurance companies to continue coverage of additional living expense (ALE) benefits in cases where returning victims of catastrophes to their residences was due to supply chain shortages or delays on the part of the insurance carriers.

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.