Are All Texas Insurance Consultants Properly Licensed?

How many Texas insurance consultants have acted beyond the scope of their insurance license/s ?

Some stop loss policies are casualty products. That’s why fee based insurance consultants in Texas must have a Risk Manager licensed issued by the Texas Department of Insurance when reviewing, recommending and placing medical stop loss insurance issued through a casualty company.
Further, certain stop loss policies are surplus lines. Placing surplus lines policies for a commission requires a Surplus Lines license. Acting as a fee based insurance consultant in Texas on the same assignment requires a Risk Managers license and written notice of dual compensation.
Some states may define all medical stop loss insurance as a casualty product. New Mexico, for example, recently considered doing so.
Will Texas be next?

New Mexico Legislature Passes SB 108 Allowing Stop-loss to be issued by A&H or P&C Carriers — Loss Ratio Requirements Still An Issue

MyHealthGuide Source: The Self-Insurance Institute of America, 2/22/2016,

When introduced, SB 108 would have required stop loss insurance to be issued by carriers with a property/casualty (P&C) license. As many SIIA members reported their company issues stop loss through an accident/health (A&H) licensed carrier, the original bill language could have been extremely disruptive. In order to continue operating in the state, most stop loss carriers would have been required to apply for a P&C license or rent a P&C license and re-file all products and rates for approval.

After being amended, the final version of SB 108 will allow stop loss to be issued by A&H or P&C carriers. There is an outstanding question about the regulation of A&H-issued stop loss:

  • Will the Office of the Superintendent of Insurance (OSI) continue to require product and rate filings to meet an 85 percent loss ratio? 

SIIA believes that the stop loss task force, convening shortly, should address and hopefully resolve this question. On a related note, SIIA does not believe that stop loss insurance issued by a P&C-licensed carrier would be subject to loss ratios.

SIIA has also obtained a copy of a draft bulletin that the OSI may issue. The bulletin appears to allow existing policies to apply for rate increases and not be subject to the loss ratio requirement. OSI staff is reportedly discussing the bulletin this week, and we may know shortly if the bulletin will be issued. SIIA is urging the OSI to issue the bulletin and allow carriers to file for adequate rates.

In general, SIIA is pleased that we are making incremental progress. First, the passage of SB 108 has deleted a provision in New Mexico law that defines stop loss as a form of health insurance. Second, we were able to avoid widespread marketplace disruption if state law suddenly recognized stop loss as a casualty product rather than accident/life. Finally, we believe the OSI’s stop loss task force will deal with some outstanding issues that SIIA members face, including the inability to file a new stop loss policy.

About SIIA

The Self-Insurance Institute of America, Inc. (SIIA) is a dynamic, member-based association dedicated to protecting and promoting the business interests of companies involved in the self-insurance/alternative risk transfer (ART) industry, both domestically and internationally. Contact Adam Brackemyre, Vice President of State Government Relations directly at 202-595-0641, and visit