Insurance - Third Party Administrators - Enforcement

New fines and stricter rules for insurance administrators

Beginning October 1, 2026, the Insurance Commissioner can deny, not renew, suspend, or revoke a third-party administrator’s registration for misconduct. Misconduct includes lying on the application, fraud, certain crimes, illegal or dishonest acts in plan work or for a life insurer, breaking state insurance laws, or ignoring the Commissioner’s orders or rules. The Commissioner can fine an administrator up to $10,000 for each violation of insurance law. The Commissioner can also fine up to $1,000 for each day someone stays in violation of § 8-303(a). These changes raise compliance and penalty risk for administrators and aim to better protect plans and consumers.