Health Insurers File 2024 Rates, Annuity Best Interest Model Becomes Majority Rule, Vermont Adopts Primary Name Change Protocol 

State by state variations of laws, compliance protocols, industry transparency, and general regulatory culture 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 sampler 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. 

Health insurance carrier rate filing season setting premiums for 2024

It’s rate filing season in the insurance industry of America. For some states, like Wyoming, that largely means business as usual, as the Department of Insurance in those states don’t have rate setting authority. But for states that maintain rate-setting authority, DOI employees are staying on their toes reviewing health carriers’ proposed rates.

States such as Colorado have specific goals for insurance carriers to reduce health insurance premiums (relative to inflation) over time, which may make the process more difficult as carriers and the state wrangle consumer expectations and the realities of a harder, more expensive market. The rate-setting process in these instances may include public hearings in addition to a typical back-and-forth negotiation of numbers, data, and commentary.

In Maryland, regulators’ rate-filing reviews are underway as the state examines coverage levels against its mandatory coverage requirements and pricing guidelines. A release from the Maryland Insurance Administration said filings from health and dental carriers in individual, non-Medigap, and small group markets could impact about 471,000 Marylanders. 

Connecticut, too, is reviewing 10 rate filings from nine health insurance carriers, and opened the 30-day period for public commentary on June 9, 2023.

“The review process will delve deeply into each submission, requiring insurers to provide justifications and supporting evidence. As always, the rate reviews will be comprehensive, continuing our ongoing efforts to promote transparency and accountability,” said a news release from the Connecticut DOI. “By utilizing various tools, such as benchmarking and other industry best practices, we strive to maintain a fair and competitive insurance market while prioritizing the interests of consumers.”

Annuity best interest adoption sweeps majority of states

At this point, a comfortable majority of states and jurisdictions have embraced some iteration of the annuity best interest model from the National Association of Insurance Commissioners. As Florida rolls out new regulations around annuity sales, fewer than 20 jurisdictions remain without some regulation or proposed bill to require increased annuity training and best interest oversight for producers and brokers. See here for our previous coverage on the different types of standards including suitability, best interest, and fiduciary. 

We’ve covered what the NAIC model does through one of the earlier-adopting states, but the highlights for carriers under the law are that they are responsible for:

1. Verifying suitability. An insurance carrier is bound to not issue an annuity unless they have reasonable information to believe it fits the client’s circumstances and fills their needs.
2. Supervisory system. Insurers must establish and maintain a system for ensuring producers are fully trained, complying with procedures, and documenting their sales information and justifications.
3. Taking corrective action. While the law clarifies this doesn’t prevent insurers from contracting with anyone, it does obligate insurers to do something about it in the case that they discover a producer or agency is acting out of compliance with state law.
4. Insurers aren’t responsible for products that aren’t theirs.

More states adopt simpler process for primary name changes

For people adopting new identities in new phases of their lives, a handful of states have worked to make the process simpler, at least for those who maintain insurance licenses. 

Recently, Vermont joined Connecticut, Rhode Island, and Missouri in offering a simplified process to submit primary name changes, something that’s of particular note for transgender producers and adjusters as well as anyone else who’s ever considered changing their legal identity to match their personal one. The new process will allow anyone who’s changed their first name to update their records through the National Insurance Producer Registry, minimizing the amount of legal hoop-jumping required.

Other state changes

Alabama held a hearing and comment period for revised laws that remove their current prelicensing course requirements. If adopted, the proposed laws would mean those looking to procure insurance producer licenses need only pass an examination, not attend a prelicensing class.

Colorado’s DOI has directed health insurance carriers and third-party administrators to adjust their internal policies and procedures for helping insureds find mental health services. The state anticipates an uptick in people seeking mental health services with the sunset of the COVID-19 health emergency orders. Colorado is also revising its processes to reflect that the state doesn’t require producers to prove whether they’re in the U.S. legally.

Florida is hearing from the Citizens Property Insurance Corporation, its state-backed insurer of last resort for home insurance, as the CPIC requests to raise rates for various homeowners pools. Ranging from 9.2 percent to 24.2 percent, the rate increases CPIC’s requesting are only a small piece of the story of Florida’s homeowner’s insurance woes.

Georgia has released a bulletin to clarify the role and proper use of certificates of insurance, answering questions about when producers should issue certificates and how to handle revisions to coverage and certificates.

Idaho Department of Insurance officials welcomed Gynna Loper as the new Financial Officer, with nearly 23 years of state experience.

Indiana announced the state will now require pharmacy benefits managers  to register and procure a license from the state.

Maryland Senate Bill 725 was signed into law by Gov. Wes Moore in April and went into effect July 1, 2023. Among other things, the bill restricts the ways that a carrier can incentivize a policy sale by banning inducements and rebating. A proposed regulatory update in the state would change title agent regulations to be friendlier to digital-first reviews and reporting.

Nevada has announced the state’s appointment renewal period. The state is issuing appointment renewal invoices on July 1, 2023. Carriers will have from then to Sept. 1, 2023, to pay their invoices.

North Dakota regulatory updates have nullified provisions requiring surplus lines producers to file affidavits that testify they completed their diligent search requirements in the admitted market before pursuing nonadmitted coverage. While the law still requires that surplus lines producers seek admitted coverage before turning to surplus coverage, they don’t have to file an affidavit.  

Oklahoma is hosting monthly “Medicare Mondays” webinars to educate the public about fraud prevention, Medicare Open Enrollment, and the various parts of Medicare. The state also announced it’s put a health insurance carrier into receivership under control of the state because the carrier’s become insolvent. The insolvency – and the special enrollment period it triggers – will affect 8,200 Oklahomans. (If you’re curious about receivership, check out this blog.)

Washington Commissioner Mike Kreidler announced he’s holding sessions to hear the public’s thoughts on what’s driving a historic uptick in consumer complaints around auto insurance. The state has also issued a reminder that, effective July 23, 2023, the state will no longer require producers to have prelicensing certificates to take an insurance exam.

While these points of interest aren’t comprehensive, our knowledge of insurance producer and variable lines broker license and compliance maintenance is. See how AgentSync can help make you look smarter today; head over to the Compliance Library and wrastle up some state-by-state regulation and more jurisdictional updates.