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.
SCOTUS overturn of Roe vs. Wade abortion precedent
The Supreme Court closed June 2022 by overturning the precedential Roe vs. Wade decision in the case of Dobbs vs. Jackson Women’s Health. While insurer coverage of abortion procedures has long been sporadic and uneven despite nationwide legality, this decision means state protections or bans of abortion access will likely be as splintered.
Four state commissioners sent out notices promising protections for reproductive rights following the decision:
Washington: “Washington state led the country in protecting peoples’ rights to terminate a pregnancy and we will not reverse that promise now,” said Insurance Commissioner Mike Kreidler. “Today’s decision by six justices on the Supreme Court reverses the progress we’ve made in preserving the rights of pregnant people in our country to make the most difficult decisions that only they and their families should make. I will do everything I can to maintain access to this critical service for all Washington individuals and their families.”
California: “California law is clear that we protect reproductive freedom and insurance coverage for abortion. Defending all people’s right to healthcare is a top priority for me and the Department of Insurance,” said Insurance Commissioner Ricardo Lara. “That’s why we have assembled the facts about Californians’ rights on insurance coverage for reproductive health care. We want to help cut through the clutter and make sure consumers know that California law and the Department of Insurance are there to protect them.”
Connecticut: “In the face of the U.S. Supreme Court decision overturning Roe v. Wade, the Connecticut Insurance Department under the leadership of Governor Ned Lamont and Lt. Governor Susan Bysiewicz will continue to ensure every Connecticut citizen has access to safe and appropriate health care.”
Colorado: “Reproductive health care is an important part of the health care services that every person deserves to achieve their own, self-determined reproductive well-being, and it is not a one-size-fits-all medical solution. There are many protections in place, in Colorado and federally, that ensure consumers have access to the care they need. … The Reproductive Health Equity Act (House Bill 22-1279), signed by Governor Polis on April 4, 2022, codifies the legal right to abortion services services in Colorado law. All Coloradans will continue to have access to abortion services, despite the Supreme Court ruling in Dobbs v. Jackson Women’s Health.”
For more on the interplay of health insurance regulation and evolving abortion laws, see our other coverage.
South Dakota does producers with incomplete applications a solid
July 1, 2022, a law went into effect that would allow the South Dakota Department of Labor and Regulation to close incomplete insurance producer applications without flat-out denying them. As a department newsletter says, when incomplete applications require a formal denial, simple blank fields could trigger national reporting requirements that could complicate a producer’s licensure in other states, a complication that is unfounded and unnecessary.
South Dakota has also moved to put its state annuity regulations in line with the NAIC Annuity Best Interest Standards and the Department of Labor standards. A news release outlines basic responsibilities for a standard of care, disclosure, conflict of interest resolution, and documentation for insurance companies as well as producers.
The state is hardly the first to update its annuity suitability and best interest standards, and won’t be the last. (If you doubt us, keep reading and see what Wisconsin is getting up to.)
What’s up in other states?
Hawaii recognized that its property and casualty line of authority includes marine and transportation, personal lines, surety, and vehicle licensing, yet each was listed separately on licenses. So the state is coordinating with NIPR to change all resident and nonresident producer licenses and resident and nonresident surplus lines broker licenses that carry these LOAs to merely reflect a P&C LOA, period.
Louisiana Insurance Commissioner James Donelon announced an extension of the Hurricane Ida Mediation Program through Dec. 31, 2022. The mediation is aimed at policyholders for residential insurance claims up to $50,000, and the mediators are providing these services for a flat $600 fee.
Alabama Insurance Commissioner Jim Ridling retired at the end of June after almost 14 years of service. Effective July 1, 2022, Alabama Department of Insurance Deputy Commissioner Mark Fowler will serve in the capacity of commissioner.
Vermont passed an overhaul of its insurance laws, adding definitions and requirements for travel insurance agents, expanding the regulation of captives, clarifying annual reporting requirements, and adding an entire section for data security. New regulations will take effect in August 2022.
Michigan announced action against an agent who sold surplus lines outside of licensure and used a business name not reported to the secretary of state. Another agent faced action from the state after allegedly enrolling a family in a Health Insurance Marketplace plan without their consent, which messed up their health insurance. When confronted, the agent never responded to the Michigan Department of Insurance and Financial Services. Seriously, go read the enforcement orders if you need some schadenfreude. Or, if you’re looking to stay out of trouble yourself, get AgentSync and stop licensing violations before they happen.
California Insurance Commissioner Ricardo Lara has released the state’s export list of coverages people and businesses can look for outside of the admitted market.
Florida announced new rates for policies from Citizens Property Insurance Corporation following a public comment hearing. Citizens got most of their requested rate increases, with a few exceptions such as Homeowners Multi-Peril, which Florida only allowed a 6.4 percent increase instead of 10.7 percent.
Washington released the insurer statistics for medical malpractice claims from 2021, and they’re worth a read, if just to find out that the average indemnity payment for the year was $535,896.
Pennsylvania has added optional non-uniform background questions for new applicants for reporting and outreach. Questions include those regarding military background, race, and whether an applicant identifies as LGBT+.
West Virginia has added background questions for new applicants for company adjuster or independent adjusters to ensure they are up-to-date on continuing education.
NIPR has announced a two-year phase out for the Company Specific Report, a small-data point-in-time report some insurance companies still use for manual compliance processes. Remember, if you want to get out of spreadsheets and leave manual processes behind, you should get AgentSync.
FINRA has made some changes to investment advisor representative continuing education requirements that are worth checking out. If you’re thinking “but that’s not insurance,” we hear you, but thought it was worth mentioning because so many insurance producers are dually licensed to do financial advisor stuffs.
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.