Minnesota’s Commerce Department, which regulates carriers and agents,1 has proposed loosening Minnesota law to allow insurance companies the unusual freedom to skip state approval of new, or amended, consumer policies.
Insurers would be able to sell most consumer policies simply by certifying to the Commerce Department that they comply with state law under legislation pending in the state Senate and House.
Insurers also would be able to raise and lower rates 7 percent annually without state approval.
The new rules would apply to most personal insurance including life, health, auto and homeowners policies, Commerce Department spokesman Bruce Gordon said.
Few states give insurers such a free hand. Only seven allow the sale of policies without some form of prior approval and only two don’t require insurers to file copies of policies and other forms at all, said Cheye Calvo, an insurance expert with the National Conference of State Legislatures.
About half the states give insurers similar freedom to set premiums.
The Commerce Department proposed the changes, which fit with Gov. Tim Pawlenty’s philosophy of easing state oversight of financial businesses.
Pawlenty has instructed his new Commerce Commissioner Glenn Wilson to make the state friendlier to such businesses to encourage investment and job growth while still protecting consumers.
Was this article valuable?
Here are more articles you may enjoy.