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Insurance “Innovation Sandbox” Bill Passed by 2019 General Assembly
The Kentucky General Assembly passed a bill during the 2019 legislative session that will establish an “insurance sandbox” to allow companies to test innovations in the insurance marketplace. HB 386 was sponsored by House Banking and Insurance Chair Bart Rowland (R-Tompkinsville) and it will become law on June 27.
The bill allows companies to make an application to the Insurance Commissioner to bring an innovation to consumers which would otherwise be barred by an existing statute or regulation. However, the innovation would not allow companies to operate outside of solvency, licensing, or guaranty fund requirements. If the Commissioner approves the application, the applicant would have a limited ability to bring the innovation to the marketplace in Kentucky.
After the completion of the “beta” period of innovation, the Commissioner would be able to allow others to engage in the same innovation for up to three years. The General Assembly or DOI must act on the statute or regulation that impeded the innovation during that time, or the innovation will cease.
IIK, along with other stakeholders, was integrally involved in shaping this legislation. We were pleased to be able to work with the sponsor and the Department of Insurance to satisfy member concerns with the original version of the bill.