Insurance laws
Insurance laws define the statutory rules and regulations governing insurance contracts, insurers, and insured parties in the United States. State governments create most insurance laws, as confirmed by the McCarran-Ferguson Act of 1945.
Each state’s Department of Insurance enforces licensing requirements for insurers and agents; for example, California requires all insurance producers to pass a state exam and complete background checks. Insurance laws mandate policyholder protections through solvency regulations, such as risk-based capital standards exemplified by NAIC’s model acts.
Regulators require companies to maintain reserve funds, with New York mandating that life insurers hold reserves at least equal to their policy liabilities. Laws set standards for claims handling timelines; Texas law obligates insurers to acknowledge claims within 15 days.
Insurance statutes prohibit unfair trade practices, including misrepresentation and discrimination; Florida Statutes § 626.9541 specifically lists over a dozen prohibited practices. States approve or regulate premium rate changes–for instance, Massachusetts mandates prior approval before auto or homeowners’ rates can increase, the Insurance Information Database reports.
Insurers must provide specified disclosures to consumers under law; for example, federal law (Gramm-Leach-Bliley Act) compels privacy notices regarding personal data sharing. Insurance fraud statutes criminalize actions like falsifying claims–California reported prosecuting 6,750 felony fraud cases in 2022.
Consumer complaint mechanisms are required by law; Pennsylvania’s Department of Insurance resolves approximately 4,000 consumer complaints per year relating to insurance companies’ compliance with legal obligations. Federal anti-discrimination laws like the Affordable Care Act prohibit health insurers from denying coverage based on preexisting conditions effective since 2014.
Can I choose to not have car insurance?
Yes, you can choose to not have car insurance. However, depending on your state’s laws, there may be consequences associated with driving without car insurance. You may be held financially responsible for any damages resulting from an accident if you do not have car insurance coverage. Ultimately, it is up to you whether or not…
Can I change insurance companies at any time?
Yes, you can change insurance companies at any time. Insurance companies must follow state and federal laws that allow policyholders to switch providers if they have a valid reason for doing so. Depending on the specifics of your policy, there may be certain times when changes cannot be made or may incur additional fees. However,…
Who regulates car insurance companies?
Car insurance companies are regulated by the state Department of Insurance. Each state has its own set of laws and regulations, which must be followed by any company operating within the respective state’s jurisdiction. Companies that operate in multiple states need to comply with all applicable rules and regulations from each individual jurisdiction. The Department…
Does car insurance depend on your credit score?
Yes, car insurance providers may use an individual’s credit score to help determine their premium. Insurance companies often view individuals with higher credit scores as less risky and more likely to pay their premiums in a timely fashion. As such, those with lower scores may end up paying higher rates or be denied coverage completely.…
Can I drive my car without insurance?
No, you cannot drive your car without insurance. Driving a vehicle without insurance is illegal in most states and jurisdictions, and can result in various penalties, such as fines or license suspension. If you are found to be at fault in an accident that occurs while driving uninsured, you may be held liable for the…
Do I have to buy car insurance?
No, car insurance is not mandatory in most states. However, it is recommended to purchase car insurance as it can help cover the costs associated with potential losses due to an accident or other covered event. Some states may require drivers to have a minimum amount of car insurance coverage if they want to legally…
Can unmarried couples be on the same health insurance?
Yes, unmarried couples can be on the same health insurance. In fact, many insurance companies allow individuals to add a partner or spouse who is not legally married to their plan. Certain states have laws that allow for domestic partners to register and receive benefits as if they were married. This includes access to health…
Can I switch car insurance?
Yes, you can switch car insurance. Many insurance companies offer policies that you can switch between, allowing you to find the best policy for your needs. Many states have laws that regulate how and when you can cancel or change your current insurance policy. These laws are designed to protect consumers from being taken advantage…
Are you legally required to have homeowners insurance?
Yes, most homeowners are required to have insurance by their lender or mortgage provider. Generally, the minimum amount of coverage is usually enough to pay off the outstanding balance of a loan should something happen to the property. Many states require homeowners to purchase certain types of coverage and may even have specific laws in…
Is it illegal to not have insurance?
It depends on where you live. In the United States, each state has different laws about auto insurance coverage. Generally, it is illegal to drive without any form of motor vehicle insurance in most states. Some states may have different requirements for minimum insurance coverage and/or types of insurance that are required such as liability…
How do I deal with a car accident if I don’t have insurance?
1. The first step to dealing with a car accident if you do not have insurance is to contact the other driver’s insurance company to see if they are willing to cover some or all of the cost associated with damages and repairs. You can also check your state laws to find out what forms…
When do you lose your parents’ health insurance?
When you turn 26, you will lose your parents’ health insurance. This is due to the federal law that states you can no longer be covered by a parent’s plan once you reach the age of 26. It is possible, however, to remain on their plan if they have extended coverage through their employer or…
See also Insurance laws and regulations.