Regulatory Roundup: NAIC Leadership, Kentucky Cybersecurity, Colorado’s Marshall Fires

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. 

Lindley-Myers to head NAIC, Mais president-elect in 2023

Missouri Department of Commerce and Insurance Director Chlora Lindley-Myers has assumed the lead of the National Association of Insurance Commissioners for 2023. Lindley-Myers succeeded Dean Cameron, Director of the Idaho Department of Insurance.

Lindley-Myers took the lead of Missouri’s insurance department in 2017, and brought with her experience from Tennessee and Kentucky’s insurance departments, and experience working for the NAIC office in Kansas City.

NAIC members also elected Connecticut Insurance Commissioner Andrew Mais to serve as president-elect, assuming he will take the position of president in 2024. Mais was first appointed to his role as the 33rd commissioner of Connecticut in 2019, and was reappointed by Gov. Ned Lamont in December 2022.

Prior to his role as president-elect, Mais served as NAIC vice president. Congratulations to Lindley-Myers and Mais, we’re excited to see what 2023 brings!

Kentucky guidelines for new cybersecurity regulation

Cybersecurity made headlines throughout 2022, partly thanks to high-profile hacks and eye-popping insurance filings, and partly because the federal government passed some fledgling regulation of how entities that provide critical infrastructure (including insurance carriers!) must be transparent about cyberattacks.

Accordingly, many states have passed their own take on reporting requirements for insurance entities; the Kentucky legislature got in on the action, too, passing reporting requirements for anyone with an insurance license. Yet, as time goes on and cybersecurity incidents rise, moving past broad strokes and hypotheticals is critical.

To that end, the Kentucky Insurance Department issued a bulletin giving more specific guidelines on the 19 data points that licensees must report when alerting the state to a cyberattack. Fortunately, there’s quite a bit of overlap between the state and federal regulations, but, in a 50-state regulatory environment, there’s still some danger that sending one report for insurance entities will mean sending a million similar reports across numerous jurisdictions.

In the case of cyber incidents, the best defense against having to file a million reports is having an offensive approach to cybersecurity. Zero trust architecture is just one way AgentSync helps protect its users and strategic partners. Hint. Hint. 

Carriers extending coverage for Marshall Fire survivors 

Colorado’s been busy. After asking insurance carriers to extend coverage for consumers who are still receiving assistance with living expenses (ALE) benefits in the aftermath of the Marshall Fires, the Colorado Division of Insurance has received responses from all carriers whose policyholders only had 12 months of coverage agreeing to extend that coverage to 24 months.

A department news release said that, of 57 carriers, 47 reported having zero policyholders with less than two years of coverage, and the 10 remaining carriers contacted the DOI after the division made the request to agree to extend the coverage for affected policyholders.

Apart from Marshall Fire coverage, the state also adopted an amendment to its minimum reserve requirements for individual and group health insurance contracts to bring state regulations in line with the National Association of Insurance Commissioners’ model regulations on the subject. Similarly, officials adopted regulations effective March 2, 2023, to set reserve standards for term and universal life insurance contracts, which may have “non-level benefits” and include securities components. 

The state insurance commissioner also issued a bulletin setting the maximum benefit for early intervention services on grandfathered individual and group benefit plans at $9,101. 

Other state changes

Michigan announced Joe Garcia as the insurance department’s new general counsel.

Washington continues its removal of language that would have prohibited carriers from using credit histories as part of underwriting policies after Commissioner Mike Kreidler’s initial prohibition was ruled an overstep by the courts in August 2022.

U.S. Virgin Islands, Puerto Rico, Delaware, and Maryland appointments and terminations will no longer require carriers to submit Social Security numbers as part of the information starting Feb. 10, 2023, and will rely on the national producer number (NPN) instead.

New York legislation signed by the governor at the end of the session simplifies the state’s surplus lines reporting requirements, which the Excess Line Association of New York (ELANY) explains further here.

Oklahoma Insurance Department officials announced the OID has awarded its insurance licensing examinations contract to PSI, moving from Prometric’s services Feb. 1, 2023. 

Florida’s property insurers are subject to a data call on personal and commercial residential property claims litigation for all of 2022, which they must submit by March 1, 2023.

Nebraska Department of Insurance officials announced the NDOI has awarded this year’s insurance licensing examinations contract to PSI, moving from Prometric, effective Feb. 1, 2023. 

North Carolina announced carrier appointment renewal deadlines, with terminations that were due Jan. 22, 2023, and an invoice payment open from Feb. 3 – March 31, 2023. For those that miss the renewal, the state also has a renewal grace period from April 1 to May 14, 2023.

California has revised an hour of the three required continuing education hours on ethics for insurance producers, effective March 1, 2023.

Also worth noting, as states update their appointment fee lists, other states update their roles with the applicable retaliatory appointment fee for carriers domiciled in other states. For a reminder on why this is an exhaustive practice that just makes it more irritating for insurance carriers to do business across the U.S., check out our blog.

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.