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.
State departments of insurance require carriers to disclose climate risks
Tis the season for climate risk disclosure. Washington Insurance Commissioner Mike Kreidler announced his office had sent the Climate Risk Disclosure survey to insurance carriers. The state requires carriers that have more than $100 million in written premiums in the U.S. to fill out the disclosure.
The NAIC Climate Risk & Resiliency Task Force developed the survey, and sent out a new version in April 2022 as the NAIC worked to align its survey with other regulatory bodies. Kreidler serves as vice chair to the task force, and worked intently on shaping the data reporting mechanism to give the industry guidance on identifying best practices and vulnerabilities.
“This survey is a continuation of the work my office, and my fellow insurance regulators, have done to strengthen the industry to meet the threats presented by climate change,” Kreidler said in a news release. “The information we gather in this survey will benefit both the industry and consumers in a meaningful way.”
Washington, however, isn’t the only state to get in on the climate data action. At this point, 27 state jurisdictions require their domestically based insurers to fill out the national survey. Newcomer Michigan Department of Insurance and Financial Services Director Anita Fox also released a public statement on the survey.
“Across the country, we are seeing more frequent and more severe weather events, and this is causing some insurers to exit the market in coastal states,” said Fox. “Thankfully, our weather patterns in Michigan have been more consistent, but we must be proactive to ensure that the future outlook for Michigan’s insurance market remains stable for Michigan consumers and businesses. By remaining vigilant and focusing our insurers on the risks posed by climate change, we can help ensure that Michigan remains a great place to live, work, and do business.”
As climate change continues to up the ante for storm and disaster coverage, the survey will help regulators collect data and assess the future of insurance.
Nevada law mandates health coverage for gender-affirming care
A law passed in mid-June and signed by Nevada Gov. Joe Lombardo requires health insurers that are regulated by the state to cover gender-affirming care for transgender adults and minors.
By denoting facial surgery, hormone therapy, and other gender-affirming surgeries as “medically necessary” for transgender patients, the new law will require health insurance carriers to cover these treatments instead of dismissing them as cosmetic.
Alabama repeals prelicensing requirements (trend alert!)
While the changes won’t take effect until Jan. 1, 2024, we thought it was worth noting the state will join others (like Louisiana and Washington) that have dropped the prelicensing requirement. Since producers still need to pass the insurance exam for their specific license, eliminating the prelicensing requirements is intended to lower unnecessary barriers of entry to the industry.
Simplifying insurance processes? Yes, please. If you’re interested in simplifying your own internal insurance processes, check out what AgentSync can do.
Other state regulatory changes
Colorado Division of Insurance opened a special enrollment period (SEP) for members of a health insurance network that has been placed into receivership in many states. Consumers previously covered by the organization have until Aug. 31, 2023, to find a new health insurer – no doubt other health insurance carriers in the state will absorb the attrition.
Georgia is implementing the suitability in annuity transactions rule, which will require producers who are licensed to sell annuities to take a one-hour refresher on new regulations and will require newly licensed annuity sales people to take a four-hour annuity suitability course.
Louisiana has announced the state’s carrier appointment renewal period for producer agencies (not to be confused with producer individuals). The state DOI has posted the invoices to NIPR, and payments were due Aug. 1, 2023.
Maine legislators voted for peace and solidarity by removing the provision in the state’s surplus lines tax that imposes retaliatory taxes on nonadmitted insurance from insurers based outside of Maine. The removal is retroactive to Jan. 1, 2023, meaning any nonadmitted policies sold since then will only be subject to the state’s 3 percent tax on premiums. The state also clarified regulations around pet insurance, clarifying that producers must be licensed in property, health accident and sickness, or personal lines in order to sell pet insurance.
Maryland made it mandatory for those with a property and casualty license in the state to take two hours of flood insurance education as part of their continuing education requirements.
Nevada added pandemic protection insurance to its export list of special lines surplus coverage.
Pennsylvania Department of Insurance officials posted a notice of per diem charges for those undergoing Market Conduct Examinations (including $1,064 for a Division Chief’s visit) as well as per diem charges for a Financial Examination (like $1,650 for a Chief Actuary’s time).
Texas Department of Insurance officials repealed the section of its insurance code that regulates navigator licensing. From June 19, 2023, on, the state no longer requires navigator registration, pre-licensing, or continuing education requirements. The role of insurance navigator was first established in the aftermath of the Affordable Care Act to help consumers “navigate” their options for life, health, and disability insurance coverage.
Utah issued a bulletin to remind carriers that if they terminate a producer for cause, they’re obligated to report the finer details to the state department of insurance.
Washington issued $40,863 in fines against insurance companies and producers for various insurance violations in June 2023. If only there was a way to avoid petty compliance violations with some kind of system that automatically maintained your data…
Wisconsin announced administrative actions taken by the Wisconsin Office of the Commissioner of Insurance during June 2023, and the list of actions gives us a few good industry pointers: Don’t lie on your application for an insurance license – they’ll find out and you’ll be in worse trouble than if you had just been honest; public adjusters should be sure to have surety bonds; and everyone should keep their contact information up to date with the state.
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 wrassle up some state-by-state regulation and more jurisdictional updates.