In Eastbridge’s recent Frontline™ Report, Situs State Regulation Practices of Voluntary Carriers, 93 percent of the participating carriers are pleased with their company’s situs practices. This compares to 83 percent in 2012. One contributor to this more optimistic view is more carriers today believing that sales are impacted positively by their situs states policies (40 percent compared to 27 percent in 2012). The seven percent who are not satisfied prefer a more liberal stance (e.g.: using an employer situs state definition more often). Of those carriers participating in the most recent study, two-thirds are using the employer’s situs state as their governing state for multi-state groups compared to 47 percent in the 2012 study. While most companies try to use the employer situs state to govern the issuance of coverage, the survey showed that product differences, platform differences, and differences in the impact of extraterritorial regulations in various states can make managing multi-state accounts (or those accounts on the border of more than one state) a challenge.
Although there is a trend towards using employer situs state more often and a higher percentage of carriers are satisfied with their company’s current situs policies, most respondents have not substantially changed their practices in the last five years. Fifty-nine (59) percent of the respondents said the topic is rarely discussed internally, with 38 percent acknowledging that the topic does come up occasionally.
Situs State Regulation Practices of Voluntary Carriers is an Eastbridge Frontline™ Report. Frontline Reports provide timely data on hot or new topics. Copies of the report are only available to participants and Eastbridge Information Partners™.
Eastbridge Consulting Group, Inc. is a marketing advisory firm serving insurance and financial services organizations in the United States and Canada.