Insurance Regulatory Roundup | July-August 2026

The convergence of AI governance and insurance oversight gained further momentum in July as several jurisdictions issued guidance or enacted requirements:

• Puerto Rico issued a June 11, 2026 ruling letter aligned with the NAIC AI Model Bulletin, making clear that AI-supported decisions affecting consumers, insureds, claimants, applicants, vendors, or third parties remain subject to the Puerto Rico Insurance Code. The ruling letter applies across the insurance life cycle, including product development, marketing, distribution, underwriting, risk rating, pricing, policy servicing, consumer services, fraud detection, claims management, investigations, and other regulated activities.
• Rhode Island enacted the Use of Artificial Intelligence by Healthcare Providers Notification Act. The bill was signed by the governor on June 22, 2026, and requires healthcare providers and healthcare facilities to inform patients when AI is used to memorialize patient visits.
• South Carolina’s Workers’ Compensation Commission issued a bench order setting an interim policy on generative AI use. The policy applies to Commission employees, lawyers appearing before the Commission, and parties to proceedings, and requires litigants to ensure the accuracy of AI-assisted work product. Memoranda of law submitted at a commissioner’s request must include a signed statement disclosing whether AI was used.

State CE activity moved in both directions this month, expanding opportunities in some jurisdictions while eliminating requirements in others:

• Michigan — Effective July 27, 2026, insurance producers may receive up to four hours toward their CE requirement by completing a qualifying course offered through a professional insurance association of which they are a member. The credit is not automatic, and certain conditions must be met.
• New Mexico — The Producer Licensing Bureau is in the preliminary stages of evaluating potential CE amendments prompted by catastrophic events and wildfires that have challenged consumers’ ability to obtain or maintain homeowners insurance. The state is weighing whether producer education on property insurance availability, wildfire-related risks, and the New Mexico FAIR Plan would better equip producers to assist consumers. External FAIR Plan consumer materials reinforce the operational relevance: the New Mexico FAIR Plan is a market of last resort for eligible properties when coverage cannot be obtained in the voluntary market, and applications must be submitted by a licensed producer.
• Oklahoma — Effective July 25, 2026, the Long-Term Care training requirement was eliminated.

All states now have a best interest standard and training requirement in place except the District of Columbia, which remains pending. DC’s revised proposal was published in June and entered a 30-day comment period, with adoption possible as early as August 7, 2026. While near-universal adoption is well established, the compliance obligation is ongoing:

• Every producer selling annuities must complete the required best interest training before making sales.
• Firms must track compliance across all active jurisdictions, with DC poised to add to that obligation once it finalizes its rule.

Health remained among the most active insurance lines, with several states enacting significant coverage requirements:

• California added Insurance Code Section 10123.861, requiring health insurance policies with outpatient prescription drug benefits to cover FDA-approved treatments used to treat menopausal symptoms, as medically necessary. Policies issued, amended, or renewed on or after January 1, 2027, must also include a program to ensure insured individuals have access to current menopause information and covered items and services.
• Louisiana enacted coverage requirements for mobile crisis response and behavioral health crisis care services. The law requires coverage for those services by eligible providers, states that prior authorization shall not be required for covered mobile crisis response and behavioral health crisis care services, and becomes effective July 1, 2027. Louisiana also enacted coverage requirements for genetic testing and medically necessary treatment of SCN2A-associated medical conditions for plans delivered, issued for delivery, renewed, or otherwise contracted for in the state on or after January 1, 2027.
• Rhode Island approved legislation requiring state-regulated insurers to cover vaccines recommended by the Rhode Island Department of Health without cost-sharing barriers. Rhode Island law also requires coverage for mobile response and stabilization services for children and youth experiencing an acute mental health crisis, for policies delivered, issued, or renewed on or after January 1, 2026, subject to specified exclusions.

Continued regulatory attention on property and casualty markets was evident in two developments:

• Illinois enacted requirements related to participation in the NAIC Climate Risk Disclosure Survey.
• Nevada issued underwriting guidance regarding property inspection practices for new homeowners policies.

Numerous states amended operational and consumer-protection requirements, reinforcing the ongoing need for process controls, workflow management, and documentation retention:

• Unclaimed property administration — Connecticut, Vermont, and Florida.
• Life insurance benefit administration and Death Master File procedures — Illinois.
• Consumer complaint handling — Arkansas (SBS Complaint Portal).
• Application fraud enforcement — Delaware.
• External review procedures — Connecticut.
• Salvage vehicle ownership transfers following total-loss settlements — Hawaii.

Several regulators issued guidance emphasizing governance and oversight obligations:

• New York DFS issued guidance regarding life insurance and annuity compensation limitations and sales-expense practices.
• Pennsylvania updated its schedules for both market conduct examinations and financial examinations.
• Delaware reminded workers’ compensation insurers of their workplace safety inspection responsibilities.