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MARYLAND INSURANCE ADMINISTRATION

ORIGIN & FUNCTIONS

The Maryland Insurance Administration began in 1872 as the Insurance Department under the Comptroller of the Treasury (Chapter 388, Acts of 1872). Renamed the State Insurance Department, it became an independent agency in 1878 (Chapter 106, Acts of 1878). As the Insurance Division, it moved to the Department of Licensing and Regulation in 1970 (Chapter 402, Acts of 1970). It was reorganized as the Maryland Insurance Administration, an independent agency, in 1993 (Chapter 538, Acts of 1993).

[photo, St. Paul Plaza, 200 St. Paul Place, Baltimore, Maryland] Periodically, the Administration examines all companies organized under the laws of Maryland and scrutinizes nonresident companies doing business in the State. The Administration also investigates consumer complaints and questions concerning insurance companies operating in Maryland, and resolves insurance appeals and grievances concerning coverage decisions or claims denials.

St. Paul Plaza, 200 St. Paul Place, Baltimore, Maryland, January 2001. Photo by Diane F. Evartt.

MARYLAND INSURANCE COMMISSIONER

The Maryland Insurance Administration is directed by the Maryland Insurance Commissioner who ensures that all insurance laws of the State are faithfully executed, and counsels and advises the Governor on all matters assigned to the Administration. The Commissioner authorizes and licenses insurance companies, producers, adjusters, and advisors for fire, casualty, life, accident, health, title, bail bonds and other insurance and annuities. The Commissioner also approves all insurance policies offered for sale in Maryland by authorized companies, authorizes rating bureaus and advisory organizations, and approves or rejects the rates for most lines of insurance.

The Commissioner is appointed to a four-year term by the Governor with Senate advice and consent. Subject to the Governor's approval, the Commissioner appoints the Deputy Commissioner (Code Insurance Article, secs. 2-101 through 2-408).

Under the Commissioner, the Administration is organized into eight sections: Administration; Compliance and Enforcement; Consumer Education and Advocacy; Examination and Auditing; Insurance Fraud Division; Life and Health; Producer Licensing; and Property and Casualty.

ADMINISTRATION

Administration originated as Administrative Services and reformed as Administration in 2001. Abolished in 2009, it reorganized under its present name in 2011.

Administration includes three units: Fiscal Services; Human Resources; and Management Information Systems.

HUMAN RESOURCES
Human Resources started as Professional and Consumer Services and adopted its present name in 2000. The office conducts administrative services, including personnel management, training, and facility support services.

COMPLIANCE & ENFORCEMENT SECTION

In 2002, the Compliance and Enforcement Section was formed when the Agent Enforcement and Market Conduct Examination units of the Life and Health Section merged with those of the Property and Casualty Section.

The Compliance and Enforcement Section oversees the regulation of insurance companies in Maryland, insurance producers, title agents, public adjusters, and issuers of bail bonds. It conducts general and target market-conduct examinations, which include a review of sales practices, advertising and materials, underwriting practices, and claims handling practices. The Section also investigates insurance producers and other unauthorized entities for compliance with insurance laws and regulations.

CONSUMER EDUCATION & ADVOCACY SECTION

Origins of the Consumer Education and Advocacy Section trace to September 1997, when the Inquiry and Investigation units of the Life and Health Section and the Property and Casualty Section merged to form the Consumer Complaint Investigation Section. The Section received its present name in September 2004.

The Section investigates and resolves complaints made by insurance policyholders, claimants, beneficiaries, and providers of health care. It also provides insurance information to the public.

EXAMINATION & AUDITING SECTION

The Examination and Auditing Section licenses all insurance companies conducting business in Maryland. It conducts financial analyses and examinations of licensed insurers as often as the Commissioner deems advisable, but at least every five years. In addition, the Section performs audits of the annual statements and quarterly and annual premium tax reports of insurers.

Under the Section are Company Licensing, Financial Analysis, Financial Examination, and Premium Tax.

INSURANCE FRAUD DIVISION

The Insurance Fraud Division was established by the Governor as a unit within the Department of Licensing and Regulation in 1992 (Executive Order 01.01.1992.24). The unit transferred to the Office of the Governor in 1993 (Chapter 538, Acts of 1993; Executive Order 01.01.1994.16). In July 1995, the unit joined the Maryland Insurance Administration.

In cooperation with the Department of State Police and the Office of the Attorney General, the Division investigates and prosecutes individuals and companies who commit insurance fraud. In addition, the Division reviews anti-fraud plans and annual fraud statistics submitted by insurance companies.

LIFE & HEALTH SECTION

The Life and Health Section reviews the life, health and dental insurance policies used by Maryland insurance providers. Each annuity contract and each health maintenance organization (HMO) subscriber and provider contract used in Maryland is reviewed by the Section. To ensure that premium rates are not excessive, inadequate, or discriminatory, the Section also reviews initial rate filings by insurers.

Under the Section are four units: Appeals and Grievances; Life and Health Complaint Investigations; Managed Care; and Medical Director and Private Review Agent Oversight.

PRODUCER LICENSING SECTION

Created as Licensing in 1997, the Producer Licensing Section was renamed in 2001.

The Section licenses insurance producers and other professionals (including bail bondsmen), and reviews and approves continuing education courses. It conducts background investigations of applicants for agent and broker certificates of qualification, as well as of officers, directors, and major stockholders of insurance companies licensed in Maryland. The Section also verifies that agents and brokers meet continuing education requirements. For Maryland residents applying for licenses in other states, the Section issues letters of certification or clearance.

PRODUCER LICENSING UNIT
The Producer Licensing Unit began as the Agent and Broker Licensing Unit and adopted its present name in July 2001.

The Unit administers qualifying examinations for insurance producers, advisors, and public adjusters. To those who qualify, it issues certificates. The Unit also renews certificates of qualification, and processes insurance company requests for agent appointments and terminations.

PROPERTY & CASUALTY SECTION

For property, casualty, surety, mortgage guaranty and title insurance used in Maryland, the Property and Casualty Section reviews policy forms. To ensure the fairness of premium rates, the Section also reviews rate filings. In addition, the Section reviews nonfinancial activities of property and casualty insurers.

The Section oversees two units: Property and Casualty Complaint Investigations; and Property and Casualty Rates and Forms Review.

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