Alert Edition January 2021

Welcome to the January 2021 edition of the FORC Alert. If you have any colleagues that may be interested in this publication, please forward it on. There is a link on the Alerts main page where they can subscribe to receive FORC Alerts automatically.

Regards,
C. Ignacio Matos, Esq., FORC Alert Co-Editor
Ryan Smart, Esq., FORC Alert Co-Editor
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Category(s): Alabama - 01/25/2021

The Alabama Department of Insurance (ALDOI) Releases Survey Results Taken to Understand the Private Flood Insurance Market

The Alabama Department of Insurance (ALDOI) released results of a survey taken to understand the private flood insurance market in the state. The ALDOI commissioned Milliman, Inc. (Milliman), a premier global consulting and actuarial firm, to survey flood insurance industry stakeholders and understand their concerns and perspectives around writing private flood insurance in Alabama, and ways to overcome regulatory, technical, and consumer-focused challenges.

The survey results have prompted the ALDOI to take action to encourage the private flood market. This includes supporting draft legislation that exempts flood insurance from Alabama’s rating laws, allowing insurers to avoid regulations that may be appropriate for other residential property yet onerous for the unique peril of flood.

“The Milliman survey will go a long way toward helping us identify ways to facilitate a viable private flood market in Alabama that offers coverage at an affordable price and protects Alabamians from expensive flood losses,” explained Insurance Commissioner Jim Ridling. “We want to create an opportunity to encourage insurers to write affordable flood policies that protect our citizens, facilitating a healthy, competitive market for insurance companies.”

As noted in Milliman’s report, Alabama consumers currently have limited choice to purchase flood insurance, especially in the admitted market. In Alabama, as in most other states, the private flood insurance market is relatively undeveloped and does not bridge much of the flood protection gap.

Commissioner Ridling said, “Creating a private flood market will increase options for Alabama homeowners to have a flood policy at a competitive rate. Adding flood coverage will close the gap of insurability and better protect Alabamians from losses.”

Milliman principal Nancy Watkins, a co-author of the report, says, “Through this survey, the ALDOI has demonstrated great leadership in their efforts to reduce the roadblocks to private flood insurance through improvements in regulation, communication and education.”  Download a copy of the survey report by clicking here.

Stephen W. Still, Esq. - BALCH & BINGHAM LLP, (205) 488-5512 , sstill@balch.com

Category(s): Alabama - 01/26/2021

The Alabama Department of Insurance has issued/updated the following Bulletin and Legal Regulations

Bulletin No. 2020-21
Producer, Adjuster, & Title Ins. Agent Licensing Issues in light of the COVID-19 Emergency - Modification of Bulletins No. 2020-03, 2020-10, 2020-12, 2020-15, 2020-16, & 2020-19

Regulation Number: 166
Corporate Governance Annual Disclosure (Section 3 [Rule 482-1-166-.03] revised effective December 18, 2020)

Regulation Number: 161
Adoption of Valuation Manual (revised effective January 1, 2021) [adoption of new Section 7 (Rule 482-1-161-.07)]

Stephen W. Still, Esq. - BALCH & BINGHAM LLP, (205) 488-5512 , sstill@balch.com

Category(s): Florida - 01/25/2021

Cabinet Approves FHCF Amended Insurer Reporting Requirements and Responsibilities

The Florida Hurricane Catastrophe Fund (FHCF) held a rule development workshop on October 27, 2020 to discuss proposed amendments to Rule 19-8.029, F.A.C., Insurer Reporting Requirements and Responsibilities. Specifically, the amendments address insurer exposure and loss reporting requirements for the 2021-2022 contract year and insurer responsibilities. On December 15, 2020, the Governor and Cabinet approved a request for approval of a Notice of Proposed Rule and to file this rule for adoption, if no member of the public timely requests a rule hearing, or if a hearing is requested and no notice of change is needed. The Notice of Proposed Rule was published on December 16, 2020, and comments are being accepted until January 6, 2021. If timely requested, a rule hearing will be held on January 7, 2021. Further details of Rule 19-8.029 can be found here.

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 592-5530 , rifiman@bellsouth.net

Category(s): Florida - 01/25/2021

Commissioner David Altmaier Elected as 2021 NAIC President

The National Association of Insurance Commissioners (NAIC) recently held its Fall 2020 National Meeting in early December.  During the meeting, members elected officers for 2021, which included Florida Insurance Commissioner David Altmaier as NAIC President.  Commissioner Altmaier assumes his one-year term on January 1, 2021.  The NAIC press release announcing its 2021 NAIC officers can be found here.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 01/25/2021

DWC Releases Updated Report on Effects of COVID-19 on Florida’s Workers’ Compensation System

In December, the Florida Division of Workers’ Compensation (DWC) released an updated data summary report outlining the effects of COVID-19 on Florida’s workers’ compensation system. The DWC intends to continually update this report as new data is reported and analyzed. The 2020 report, as of November 30, 2020, can be found here.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 01/25/2021

Governor Extends Emergency Declaration for COVID-19

On November 3, 2020, Governor Ron DeSantis issued Executive Order 20-276 to extend the state of emergency declared for the entire state due to COVID-19. The order extends the state of emergency declared in Executive Order 20-52, as extended by Executive Orders 20-144, 20-166, 20-192, and 20-213, for another 60 days, until January 2, 2021. Additionally, Governor DeSantis issued Executive Order 20-297 on November 24, 2020 establishing the state will remain in Phase 3 of the Safe. Smart. Step-by-Step. Plan for Florida’s Recovery through the duration of the declared emergency.

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 592-5530 , rifiman@bellsouth.net

Category(s): Florida - 01/25/2021

The Florida Department of Financial Services Division of Workers’ Compensation (DWC) Announces Maximum Workers’ Comp Rate

On November 30, 2020, the Florida Department of Financial Services Division of Workers’ Compensation (DWC) issued an Informational Bulletin establishing the maximum workers’ compensation rate, effective January 1, 2021.  Specifically, the maximum weekly compensation rate for work-related injuries and illnesses, occurring on or after January 1, 2021, shall be $1,011.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 01/25/2021

The Florida Office of Insurance Regulation (OIR) Approves a Decrease in Workers’ Comp Rates

The OIR issued a Final Order in early November granting approval to the National Council on Compensation Insurance (NCCI) for an overall statewide decrease of 6.6% for Florida workers’ compensation insurance rates. The approved amended rate filing met the stipulations set forth by the OIR’s Order on Rate Filing issued on October 30, 2020. The new rate applies to both new and renewal workers’ compensation insurance policies effective in Florida as of January 1, 2021. Further information about the NCCI public hearing and rate filing can be found here.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 01/25/2021

The Florida Office of Insurance Regulation (OIR) Issues Multiple Hurricane Data Calls

In late October, the OIR issued data calls to collect additional claims and other relevant information from insurers related to a natural disaster causing catastrophic damage in the state of Florida.  Specifically, data call notices were issued for Hurricane Sally, Hurricane Michael, and Hurricane Irma.  The OIR previously provided a notice to insurers to file a Catastrophe Reporting Form (CRF) through the Insurance Regulation Filing System (IRFS) for these hurricanes.  Information regarding catastrophe claims reporting can be found here.

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 592-5530 , rifiman@bellsouth.net

Category(s): Georgia - 01/25/2021

Georgia Insurance Commissioner’s Directive 20-EX-9 for Suspension of Pre-Authorization Waiting Periods for Post-Acute Placements of COVID-19 Patients

On December 3, 2020, Georgia Insurance Commissioner issued Directive 20-EX-9, which advised health insurance issuers that they should suspend for 60 days preauthorization requirements for post-acute placements of COVID-19 patients in skilled nursing facilities, home healthcare services, acute rehabilitation services and long-term acute care hospitals following inpatient hospitalization. The purpose of this directive is to facilitate quicker post-acute placements to relieve the pandemic’s straining on hospital bed capacity for Georgia hospitals.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com

Category(s): Georgia - 01/25/2021

Georgia’s ACA Second Section 1332 Waiver for Reinsurance Facility Approved

On November 1, 2020, the Centers for Medicare & Medicaid Services and the Department of Treasury approved Georgia’s request to implement a second Section 1332 State Relief and Empowerment and Waiver for the individual health insurance market.  Under this waiver, Georgia will create a reinsurance program and substitute a new online platform in lieu of the healthcare.gov enrollment system.  The new reinsurance facility will commence in 2022, and the new state online health insurance enrollment portal will debut in 2023.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com

Category(s): Montana - 01/25/2021

Injunction Issued Against MT DOI

FORC member Bruce Spencer and Sean Slanger from FORC member Jacqueline Lenmark’s office, obtained a permanent injunction against the Montana Commissioner of Securities and Insurance prohibiting CSI from demanding confidential and proprietary documents as part of PBM licensure.  The court in a preliminary injunction order which is incorporated into the party’s stipulation indicated that CSI’s actions were “administrative extortion”.

Bruce M. Spencer, Esq. - Law Offices of Bruce M. Spencer PLLC, (406) 459-2122 , bruce@brucespencerlaw.com

Category(s): Montana - 01/25/2021

Montana Advisory Memo Rescinded

On November 2nd, 2020, the Commissioner of Securities & Insurance (CSI) rescinded an advisory memorandum restricting use of defense within limits polices. Click here to read.

Bruce M. Spencer, Esq. - Law Offices of Bruce M. Spencer PLLC, (406) 459-2122 , bruce@brucespencerlaw.com

Category(s): Montana - 01/25/2021

Montana Elects a New Insurance Commissioner

Montana elected a new insurance commissioner, Troy Downing. Commissioner-elect Downing is a Republican from the Bozeman – Big Sky area who is a tech and insurance entrepreneur. Commissioner-elect Downing founded a storage insurance captive company and has experience in securities as well.

Bruce M. Spencer, Esq. - Law Offices of Bruce M. Spencer PLLC, (406) 459-2122 , bruce@brucespencerlaw.com

Category(s): New York - 01/26/2021

NAIC Amends Anti-Rebating Laws – A Win For Agents/Brokers, Insuretech, and Policyholders?

On December 9, 2020, the Executive Committee of the National Association of Insurance Commissioners (NAIC) unanimously adopted amendments to the NAIC Unfair Trade Practices Act (#880) (UTPA) that would allow brokers/agents and insurers to offer “rebates” to insurance consumers and would allow insuretech to bring new and innovative technologies to policyholders much faster than under the previous version of the UTPA. 

The amendments come after two-years of review by the NAIC Innovation and Technology Task Force and, among other things, would allow an insurer or producer to “offer or give non-cash gifts, items, or services, including meals to or charitable donations on behalf of a customer, in connection with the marketing, sale, purchase, or retention of contracts of insurance.”  Moreover, the amendment codifies certain value added services that can be provided by carriers without having to go through the often slow regulatory approval process.  

The amendments permit agents/brokers and/or insurers to conduct raffles and drawing as long as there is no financial cost imposed on consumers to participate in the raffle or drawing and the drawing or raffle does not obligate a participant to purchase insurance from the agent/broker or insurer.  The amendments also codify what value added services or products an insurer or agent/broker can offer an insured at no or reduced costs, and include products or services that are primarily designed to satisfy one of the following:

(I) Provide loss mitigation or loss control; 
(II) Reduce claim costs or claim settlement costs; 
(III) Provide education about liability risks or risk of loss to persons or property;
(IV) Monitor or assess risk, identify sources of risk, or develop strategies for eliminating or reducing risk;
(V) Enhance health; 
(VI) Enhance financial wellness through items such as education or financial planning services; 
(VII) Provide post-loss services; 
(VIII) Incent behavioral changes to improve the health or reduce the risk of death or disability of a customer (defined for purposes of this subsection as policyholder, potential policyholder, certificate holder, potential certificate holder, insured, potential insured or applicant); or 
(IX) Assist in the administration of the employee or retiree benefit insurance coverage. 

The adoption of these amendments to the UTPA could have a significant impact on the insurance industry, however, the impact will depend largely on how and when the individual states adopt the amendments, and how consistently the laws are adopted and interpreted by regulators.

JillAllison Opell, Esq. - Foley & Lardner LLP, (212) 338-3520 , jaopell@foley.com
Nicholas R. Paquette, Esq. - FOLEY & LARDNER LLP, (850) 513-3365 , npaquette@foley.com
Kevin G. Fitzgerald, Esq. - FOLEY & LARDNER LLP, (414) 297-5841 , kfitzgerald@foley.com

Category(s): New York - 01/25/2021

New York State (NYS) COVID-19 and Vaccine Updates

For updates on the schedule of vaccinations from New York click here.

Frederick J. Pomerantz, Esq. - INSURANCE LEGAL & REGULATORY CONSULTING, PLLC, (516) 297-3101 , PomerantzF35@gmail.com

Category(s): Oklahoma - 01/25/2021

OK Insurance Department Accreditation Renewed

The Oklahoma Insurance Department received a renewal of its 5-year accreditation from the National Association of Insurance Commissioners (NAIC) at the virtual NAIC meeting on December 3, 2020.

Angela Ables, Esq. - KERR, IRVINE, RHODES & ABLES, P.C., (405) 272-9221 , aables@kiralaw.com

Category(s): Oklahoma - 01/25/2021

Second Oklahoma Insurance Business Transfer (IBT)

Oklahoma Commissioner Glen Mulready has approved the second Insurance Business Transfer in the State of Oklahoma and the second one will now go before the District Court of Oklahoma County for a hearing on the proposed plan submitted by Sentry Insurance a Mutual Company to transfer reinsurance to National Legacy Insurance Company.

Angela Ables, Esq. - KERR, IRVINE, RHODES & ABLES, P.C., (405) 272-9221 , aables@kiralaw.com

Category(s): Tennessee - 01/25/2021

Bill Huddleston Promoted to Assistant Commissioner for Insurance

Bill Huddleston has been promoted to the position of Assistant Commissioner for Insurance at the Tennessee Department of Commerce and Insurance (TDCI).  An experienced regulator and CPA, Huddleston most recently served as Director of Insurance of TDCI’s Insurance Division and succeeds Rachel Jrade-Rice, who left TDCI in December for a private sector role at a fintech insurance company.

T. Stephen C. Taylor, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-7758 , staylor@bassberry.com
Robins H. Ledyard, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-6259 , rledyard@bassberry.com

Category(s): Tennessee - 01/25/2021

Carter Lawrence Appointed as Tennessee Commissioner of Commerce and Insurance

Governor Bill Lee has appointed Carter Lawrence as the new Commissioner of Commerce and Insurance of the Tennessee Department of Commerce and Insurance (TDCI), succeeding Hodgen Mainda, who resigned to return to the private sector.  Commissioner Lawrence served as Interim Commissioner prior to Mainda’s appointment, and most recent served as Chief Deputy Commissioner and Chief Operating Officer of TDCI.

T. Stephen C. Taylor, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-7758 , staylor@bassberry.com
Robins H. Ledyard, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-6259 , rledyard@bassberry.com

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