MONTPELIER, Vt. - Governor Phil Scott signed legislation (S.131) yesterday that will help encourage the development of new, innovative insurance products, services, and technologies that benefit consumers, according to the American Property Casualty Insurance Association (APCIA).
Senate Bill 131 creates what is known as a “regulatory sandbox” which gives the Department of Financial Regulation the authority to grant targeted regulatory waivers to enable innovative financial products and services to be developed, tested, and introduced into the marketplace more quickly and efficiently. The new law, supported by APCIA, also includes several surplus lines related provisions including the authorization of domestic surplus lines insurers, repealing SLIMPACT and standardizing the premium tax rate for multistate risks.
“We commend the Governor, Commissioner Pieciak and state lawmakers for their leadership and actions to encourage innovation within the state’s insurance marketplace, which will help to deliver new financial services products to businesses and consumers,” said Alison Cooper, APCIA vice president, northeast region. “The regulatory sandbox concept provides the best of two worlds. It creates a climate where new and innovative ideas can be tested in the marketplace, while ensuring that consumer protections are not compromised. It also ensures that a level playing field is maintained for insurers both inside and outside of the sandbox.”
The traditional regulatory environment is often unable to fully meet the rapidly evolving and ever-changing needs of consumers and businesses in today’s modern technological world, which can have the unintended consequence of stifling innovations. “This new law enables insurers and regulators to create an environment for the pilot testing of new and innovative ways to deliver financial services products to business and consumers, which could include, for example, new ways to improve the claims process or other techniques to increase efficiencies and improve overall customer satisfaction,” said Cooper.