In conjunction with the Locke Lord COVID-19 task force, we are reviewing, analyzing, and compiling regulatory updates to provide clients easy access to information during this unprecedented time. If you have any questions on the subject matter below, do not hesitate to reach out. The information below relates to state and federal bulletins, emergency orders, pending/enacted legislation, and other related actions taken in response to the COVID-19 pandemic.
All Lines of Insurance
Colorado: On April 2nd, the Colorado Division of Insurance adopted Emergency Regulation 20-E-04 waiving the proctoring requirements for continuing education exams and allowing for the continuation of license and registration renewal deadlines and associated procedures for license and registration continuation, including continuing education requirements and licensing fees, during the outbreak of COVID-19. The Regulation applies to all current resident and nonresident insurance producers and resident and nonresident insurance agencies authorized to conduct insurance business in the state of Colorado.
Connecticut: On April 1st, Governor Ned Lamont issued Executive Order No.7S, instituting a 60-day grace period for premium payments, policy cancellations, and non-renewals of insurance policies. The Order states, “[b]eginning on April 1, 2020, for a period of 60 calendar days, ending on June 1, 2020, no insurer may without a court order, lapse, terminate or cause to be forfeited a covered insurance policy because a covered policyholder does not pay a premium or interest or indebtedness on a premium under the policy that is due except as provided hereunder.” The grace period applies to entities licensed or regulated by the Insurance Department including admitted and non-admitted insurance companies that provide any insurance coverage in Connecticut including, life, health, auto, property, casualty and other types of insurance as detailed in the Order.
Delaware: On April 1st, Governor John Carney issued the Ninth Modification of the Declaration of the State of Emergency, clarifying that policyholders are obligated to make premium payments and to comply with other obligations pursuant to a covered insurance policy. The Modification clarifies provisions from the Sixth Modification of the Declaration of the State of Emergency which stated that insurers must cease cancellations or non-renewals of insurance policies due to nonpayment.
Mississippi: On April 1st, Governor Tate Reeves issued Executive Order No. 1466 ordering all individuals currently living in Mississippi to stay at home or in their place of residence. The Order is effective at 5:00 p.m. Friday, April 3, 2020 until 8:00 a.m. on Monday, April 20, 2020. Non-essential Business and Operations must cease. Essential Business or Operations identified in Executive Order 1463 remain open. Insurance services are defined as Essential under Executive Order 1463.
Mississippi: On March 25, the Mississippi Department of Insurance (“MID”) issued Bulletin 2020-3, which imposed a 60 day moratorium on the cancellation or non-renewal of policies based on non-payment of premiums, retroactively effective to March 24, 2020. On April 1, MID issued Bulletin 2020-4, which clarifies that under Bulletin 2020-3, insurers may issue cancellation/non-renewal notices for non-payment of premiums during the 60 day moratorium period. However, when such notices are issued during the 60 day moratorium, notice periods required by statute or the policy may begin to run, but no cancellation or non-renewal for non-payment may be effective until after the 60 day moratorium period expires.
Mississippi: On April 1st, the Mississippi Insurance Department issued Bulletin 2020-5, stating that Mississippi insurance producers, adjusters and bail bondsmen whose CE compliance periods end in March, April, May, or June 2020, should timely contact the MID requesting an extension for completing CE requirements in order to meet license requirement for renewals. This includes Mississippi nonresident adjuster with Mississippi as the Designated Home State.
Nevada: On April 1st, Governor Steve Sisolak issued Emergency Declaration – Directive 010, ordering all Nevadans to stay in their residences. Individuals may leave to provider services or perform work necessary to the operations of Essential Infrastructure operations. Insurance is deemed to be Essential Infrastructure operations in accordance with Nevada Emergency Regulations- Directive 003 issued on March 20, 2020. The Directive remains in effect until April 30, 2020, unless renewed by a subsequent Directive.
Oklahoma: On April 1st, Governor J. Kevin Stitt issued the Seventh Amended Executive Order 2020-07, ordering all non-essential business to remain closed until April 30, 2020. The Order also requires all individuals entering the state from a location that has a widespread outbreak of COVID-19 to quarantine themselves for 14 days. Insurance services and insurance personal as exempt from the Order, as they are classified as critical infrastructure.
Oregon: The Oregon Division of Financial Regulation posted FAQs to the Division’s website, related to their March 25th Order directing all admitted insurers to postpone policy cancellations and non-renewals and extend grace periods. The FAQs provide guidance to insurers on how to comply with the March 25th Order. https://dfr.oregon.gov/business/reg/Pages/coronavirus-eo.aspx#property
Pennsylvania: On March 30th, Pennsylvania Gov. Tom Wolf has issued a “stay at home” order in response to the COVID-19 pandemic. The Pennsylvania order closes all non-life-sustaining businesses in Pennsylvania, and it applies to in-person insurance sales and insurance brokerage, according to Pennsylvania Insurance Commissioner Jessica Altman. The Pennsylvania department will notify the state police about any producers who violate the stay-at-home order, and it may revoke the license of a producer who repeatedly violates the order, officials said. Continued violation of the governor’s order through in-person sales and brokerage may be considered by the Department in evaluating a licensee’s worthiness to hold a license in the Commonwealth and will result in immediate administrative prosecution by PID. Penalties under such prosecution may include revoking insurance licenses, and civil monetary penalties.
West Virginia: On April 2nd, The West Virginia Offices of the Insurance Commissioner issued Bulletin 20-04a, replacing in its entirety Bulletin 20-04, which requested that every foreign insurer currently issuing policies in West Virginia submit a response describing its plans of preparedness to manage the risk of disruption to operations and the financial risk arising from COVID-19. Bulletin 20-04a states, “[i]n lieu of requiring insurers to submit responses to the [WV]OIC directly regarding the information in this Bulletin, the [WV]OIC has elected to participate in the National Association of Insurance Commissioner’s (NAIC) All State COVID-19 Operational and Financial Impact Survey. This NAIC survey should be distributed on April 2, 2020. The OIC will be in contact with insurers for whom it is the lead state to distribute the survey as soon as possible.” Responses to the survey are to be provided as soon as possible, but in no event later than April 15, 2020. Bulletin 20-04a applies to all insurers.
Property and Casualty Insurance
Delaware: On April 1st, Commissioner Trinidad Navarro issued Auto Bulletin No. 32, strongly encouraging issuers of private passenger automobile policies to waive exclusions for an insured’s commercial use of their vehicle during the COVID-19 pandemic.
Utah: On March 26th, Insurance Commissioner Todd Kiser issued Bulletin 2020-3 to provide guidance to workers’ compensation insurers collecting premium from certain employers that have closed due to COVID-19 restrictions. The Bulletin states, “Utah law does not prohibit workers’ compensation carriers from suspending premium payments by the closed-but-paying employers. Although ‘authorized insurer[s] may not knowingly… receive a premium that departs from’ its filed rates, Utah Code Section 31A-19a-216(1), this provision does not apply where a carrier is not ‘receiving premium.’” According to the Bulletin, the statute does not bar a carrier from electing not to receive premium during the time that an employer is closed but continuing to pay employees. Commissioner Kiser expects that carriers will exercise sound business and actuarial judgment in deciding whether or not to receive premium under these circumstances.
Texas: On April 1st, the Texas Department of Insurance adopted a new regulation – 28 TAC §35.2 – on a temporary, emergency basis. 28 TAC §35.2 requires health benefit plans to cover a 90-day refill of covered medications regardless of when the prescription was last refilled, unless specifically prohibited by law (e.g.; for controlled substances). §35.2 also requires coverage of prescriptions filled at out-of-network pharmacies at no additional cost to the consumer when the drug is not readily available through mail order or at an in-network pharmacy within 30 miles. §35.2 also requires plans to make drugs available on-formulary or in the same preferred tier when an on-formulary or preferred drug is unavailable due to shortage or lack of distribution.
Visit our COVID-19 Resource Center often for up-to-date information to help you stay informed of the legal issues related to COVID-19.