AITC Congratulates Enactment of West Virginia HB 2221 Insurance Innovation Regulatory Process
The Honorable Steve Westfall
Chairman
West Virginia House of Delegates Banking and Insurance Committee
P.O. Box 249
Ripley, WV 25305
June 4, 2021
Re: Enactment of House Bill 2221
Chairman Westfall,
On behalf of the American InsurTech Council (www.americaninsurtech.com), congratulations for the enactment of House Bill 2221 establishing an insurance innovation regulatory process during the 2021 regular legislative session. AITC is the independent voice for insurtechs, traditional insurance companies and agencies, and other stakeholders sharing common goals and objectives before the National Association of Insurance Commissioners, federal and state legislators, other policymakers, the media and the general public.
As you know, it is almost impossible to overstate the impact of insurtech on the insurance industry. Each year the insurance industry makes billions of dollars of investments in insurtech companies. It is estimated that there was at least $5 billion in insurtech investment in 2019 and despite the pandemic, insurtech investment in 2020 was estimated to be over $3 billion. Investment in 2021 is expected to increase. However, these numbers obscure the larger impact of insurtech on consumers.
Insurtech is changing the way consumers interact with their insurance companies. Insurtech, following in the footsteps of banks and fintech, is making policies easier to buy and in some cases easier to understand. It has expanded consumer choices by moving toward customized, on demand coverage. It is making the claims process easier, faster and more cost efficient. In short, insurtech is in the process of revolutionizing insurance, in a good way.
House Bill 2221 formally establishes an insurance innovation regulatory process in West Virginia thereby embracing the insurtech industry and providing a predictable way forward. In particular, it is important that the innovators in the insurance industry be able to interact with state regulatory authorities so that innovation can flourish while at the same time there are regulatory guardrails put in place to insure consumer protection and appealing products.
Thank you as well for your leadership in creating an outline for the West Virginia Insurance Commissioner to use as the more granular rules and regulations are established around who may qualify to enter the “sandbox”, requirements for moving through the process and significant review and appraisal analysis on the back end. It was also wise, we believe, to have included a requirement that the Commissioner report annually to the Legislature, in writing, with specific metrics.
House Bill 2221 puts West Virginia in an elite group of states that have recognized the need for new and different regulatory approaches to the burgeoning insurtech market. This will no doubt result in modern coverages made available to West Virginians, with consumer protections, with industry given certainty in navigating the regulatory process, and the state economy benefiting from an increase in jobs and economic activity.
Finally, we are aware that you and other West Virginia legislators are active in the National Conference of Insurance Legislators. House Bill 2221 could perhaps be used as a springboard for a national discussion about insurtech regulation, including uniformity.
Again, thank you for your leadership. The AITC wants to formally congratulate you and the other House Bill 222 sponsors for a job well done.
Please feel free to contact me or anyone at AITC if there is any need for follow up.
Sincerely,
Scott Harrison (sharrison@americaninsurtech.com), Jack Friou (jfriou@americaninsurtech.com), The Hon. Thomas Mays (tmays@americaninsurtech.com, JP Wieske (jpwieske@americaninsurtech.com), Teri Hernandez (thernandez@americaninsurtech.com) Co-Founders, American InsurTech Council