The Delaware Department of Insurance published a bulletin asking that all insurance carriers doing business in the state submit a letter of intent when withdrawing a line of business from the market. The Department is concerned about carriers quietly exiting lines of business and aims to minimize potential disruptions in the marketplace. The Department is asking for transparency from carriers and aims to protect consumers from unfair or discriminatory practices.
A letter of intent is requested in scenarios where: a carrier intends to discontinue an entire book of business at the end of the policy term; a carrier intends to transition all business from its company to an affiliated or non-affiliated insurer; or a carrier doesn't intend to renew a block of business.
The letter of intent should include these details:
- The reason for withdrawal
- Whether the withdrawal is specific to Delaware or if other areas are impacted
- The effective date or withdrawal
- The total annual premium loss
- The number of Delaware insureds that will be affected by line of insurance and by location
Carriers should submit letters via SERFF at least 90 days before they issue the mandated notices for withdrawal for a specific line.
The Bulletin can be found here.