Regulatory Roundup: CMS Cap Rates, Producer Licensing, Auto Insurance Reform Legislation

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, instead, as 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. 

CMS announces final cap rate changes for Medicare Advantage

The Centers for Medicare and Medicaid Services (CMS) announced its changes to rates for plan year 2026.

Capitation rates are the rates CMS pays to Medicare Advantage and private Part D insurers on a per-enrollee basis. In 2026, CMS will adjust capitation rates up by 5.06 percent. The formula for how CMS factors the adjustment has changed, and carriers will note that the program’s anticipated “change in revenue” number went from 2.23 percent overall when CMS released its first projection to the new 5.06 percent final announcement.

For Medicare Advantage, Part D, or Medicare Supplement distributors looking to get ahead of the game for the next AEP, see one AgentSync customer’s blueprint to do just that.

Licensing is important. Who knew?

What do you get if you’re a business based in Florida with your principal agent licensed in Louisiana and you try to sell business in Michigan?

Fined. The answer is, you get fined. To the tune of $2,500.

Another person became the focus of a state cease-and-desist after advertising no-fault and full coverage policies for a prominent auto insurer. Drawing business from a series of posts on Facebook, this person submitted more than 320 policies for auto insurance, generating between $48,000 and $80,000 in premium payments. Unfortunately, they didn’t have an insurance license. 

Undoubtedly, the information-gathering process to prove these unlicensed sales was painful for the insurance carrier. If only there were a way to validate that a salesperson had an insurance license before binding coverage! (There is.)

Auto reforms are on state legislative agendas

This will certainly be a year for auto insurers to invest in their legislative liaisons and in any tech that helps keep changing state regulations built into their systems.

In Louisiana, the legislative priority list includes bills that get prescriptive about how attorneys engage with insureds when it comes to suing for claims. There are also many bills that have to do with pricing transparency for auto insurance carriers. 

Virginia’s Commissioner of Insurance Scott White issued a bulletin to alert the market about how auto insurance carriers can comply with the state’s code. The regulations of note in the bulletin limit how auto insurers can account for car crashes in policy pricing and premium increases.

Connecticut is already flagging the potential for insureds to face higher premiums thanks to the will-we-won’t-we tariff policy at the federal level. According to a state alert, the Labor Department has measured a 27 percent increase in the last three years to the cost of repairing a motor vehicle. Tariffs and international retaliations will only serve to increase those inflation rates, so consumers should be aware and prepare.

Other state regulatory changes

California officials at the Surplus Lines Association put out a news release announcing they had updated the list of approved surplus line insurers.

Colorado adopted several amendments and a new regulation:

• Amended Regulation 4-2-27 Procedures for Reasonable Modifications to Individual and Small Group Health Benefit Plans
• Amended Regulation 4-2-58 Non-Discriminatory Cost-Sharing and Tiering Requirements for Prescription Drugs
• Amended Regulation 4-2-72 Concerning Strategies to Enhance Health Insurance Affordability
• Amended Regulation 4-2-82 Concerning Carrier Notices to Policyholders for Reasonable Modifications, Discontinuances, Market Exits, Drug Formulary Modifications and Carrier Renewal for Small Group Plans and Off-Exchange Plans
• New Regulation 4-2-104 Concerning Disclosures of Prescription Drug Contract Terms to Policyholders by Carriers and Pharmacy Benefit Managers

Connecticut Insurance Commissioner Andrew Mais announced the state’s new Severe Weather Mitigation & Resiliency Advisory Council has issued its first progress report as it recommends infrastructural supports to get ahead of weather disasters. 

Florida Insurance Commissioner Mike Yaworsky issued an announcement in April that he’ll direct the Office of Insurance Regulation to seek ways to give regulators and consumers more transparency in the claims process, specifically when it comes to claims denials. The state also announced an insurer will settle $6.5 million for filing fraudulent hurricane claims in 2022. Also, a 12th property insurer has entered the state market since the state’s market reforms.

Georgia has a conundrum, with a trucking company that’s been ordered to pay $22 million for an auto collision, an insurer that refuses to pay on behalf of the client, and a tort reform bill that’s wending its way through the legislature.

Iowa requires state and federal background checks, including fingerprinting, for all resident license applicants starting May 1, 2025. 

Michigan revoked five agency licenses in early April for failing to register a DRLP, and revoked a sixth for having a DRLP who ghosted clients and regulators alike. An individual producer lost their license in the state thanks to allegedly selling policies to people who didn’t actually ask for them. 

New York officials updated the state’s list of approved excess and surplus lines insurers, which is maintained by the Excess Line Association of New York.

Ohio producer appointment renewals are coming up. Carriers have until June 30, 2025, to submit terminations. Renewal invoices will be open for all of August. The state has also made changes to rules for resident and nonresident licensees about surrendering their licenses or making changes to their name, address, or other key data.

Pennsylvania Insurance Department officials updated the state’s list of coverage that isn’t available in the admitted market and is therefore eligible for brokers to find from excess and surplus insurers.

Utah Insurance Commissioner Jonathan Pike issued Bulletin 2025-4 to remind title producers and agencies to keep their information up to date with the state.

Washington has amended its state securities rules to reflect recent changes to FINRA and NASAA guidelines as well as other federal regulations. The state also put out a release noting the legislature ended the bill the commissioner supported that would have granted the Office of the Insurance Commissioner to order restitutions from insurance offenders.

Wyoming won’t take paper forms for letters of clearance, voluntary surrenders, name changes, or address changes beginning June 1,  2025. 

SILA announced a new class of SILA Designation recipients: Katie Meyer earned the SILA Fellow (SILA-F) Designation. SILA Associate (SILA-A) Designation recipients include: Joshua Bishop-Lopes, LaQuita Flowers, Dana-Lyn Gonzales, Kendra McCoy, Jonathan Miles Stevens, Gerome Kian Suniega, Nicole Thomas. Congratulations!

Stay on top of regulatory changes with AgentSync

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. If you’re looking for a solution that builds regulations like these into your distribution channel management workflows automatically, AgentSync can help. See us in action or talk to one of our experts today.