News & Insights

Louisiana Department of Insurance Orders Moratorium on Cancellation and Nonrenewal of Insurance and Suspension of Credentialing by Health Plans

March 30, 2020

Louisiana Department of Insurance Orders Moratorium on Cancellation and Nonrenewal of Insurance and Suspension of Credentialing by Health Plans

Louisiana Department of Insurance has issued Emergency Rule 40 placing a moratorium on cancellation and nonrenewal of insurance. This applies to your LAMMICO insurance coverage, subject to certain exceptions as set forth below. 

Emergency Rule 40 in summary:

  • Defines the insurance carriers and the kinds of insurance coverage governed by this order as well as the Louisiana policyholders entitled to the benefits and protections of this rule. (The Rule applies to your LAMMICO insurance coverage.)
  • Suspends cancellation, non-renewal and non-reinstatement by insurers, or premium finance companies acting on behalf of insurers retroactively to March 12, 2020
  • Cannot cancel or non-renew a policy due to a claim filed during the emergency period
  • Allows exceptions for policy cancellation due to fraud and material misrepresentation or upon written request by the consumer
  • Insureds remain obligated to pay all premiums. Any property and casualty claims during this period are subject to a premium offset prior to payment.
  • Health and accident claims related to a delinquent policy may be pended during the moratorium and will be paid in accordance with procedures established therein
  • Rule does not apply to new policies issued after the effective date of the rule - March 12, 2020
  • Suspends physician credentialing requirements applicable to health insurers as of the effective date
  • Emergency Rule 40 is effective on March 12, 2020 and shall continue in full force and effect until expiration on May 12, 2020 or on the date the Governor lifts the State of Emergency presently in effect, inclusive of any renewal thereof
  • The Commissioner of Insurance has not extended Emergency Rule 40

For questions or additional information, please contact the LAMMICO Underwriting Department 800.452.2120.

Article updated May 15, 2020 at 10:43 a.m.

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