The reenacted Maryland Insurance Article set to take effect on Saturday, Oct. 1, is expected to lift the administrative burden and lack of clarity caused by mandatory notification of minor premium increases, according to a press release issued by the Insurance Agents & Brokers of Maryland (IA&B), the statewide agents’ association that championed the legislation.
Signed by Governor Larry Hogan in April, House Bill 1408 amends the notice requirement for commercial policies to those with increases of at least 15 percent.
“We’re proud of this bill’s ability to strike a balance between simplifying the notice requirement for insurance producers and retaining the necessary protections for policyholders,” said Rick Russell, president of IA&B.
HB 1408 restores a single notification threshold for commercial renewal premium increases of 15 percent, removes the current formula and clarifies that insurers may comply with the law by sending a complete renewal policy 45 days in advance.
The introduction of HB 1408 came after insurance producers expressed concerns that the 2012 legislation did not go far enough to alleviate the administrative burden and consumer confusion caused by notices sent for de minimis increases.
This legislation follows a string of changes.
In 2009, the Maryland General Assembly eliminated the 20 percent threshold for notices, therefore prompting policyholder notification in the case of any commercial premium increase.
In 2012, IA&B successfully pushed for legislation that exempted certain premium increases from the notification requirement.
Source: Insurance Agents & Brokers of Maryland
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