Workgroup on the Affordability of Private Passenger Automobile Insurance – Extension and Alteration of Membership and Duties
Summary
SB865 extends and expands the existing Workgroup on the Affordability of Private Passenger Automobile Insurance. The bill keeps the Maryland Insurance Administration’s workgroup in place for an additional year and broadens its membership to include additional industry, actuarial, and consumer-research voices. It also changes the workgroup’s charge from primarily studying affordability and reporting findings to producing more concrete, data-driven legislative recommendations.
The bill specifically directs the workgroup to develop recommendations to reduce auto insurance premiums, including recommendations on territorial rating and other rating factors that may create disparate impacts. It also requires the workgroup to consider how any proposed changes would affect rates across the state and to submit an updated report by January 1, 2027. The measure amends the prior 2025 law to extend the workgroup’s sunset date from June 30, 2026 to June 30, 2027 and updates the reporting deadline accordingly.
Impact
SB865 does not directly change insurance rating law or premium-setting rules, but it extends the statutory life of the existing workgroup and expands its mandate to generate specific policy proposals. It amends Chapter 395 of the Acts of 2025 by revising the workgroup’s membership, adding representatives from the National Association of Mutual Insurance Companies, an actuary, and two nonprofit research or consumer-advocacy representatives with expertise in automobile insurance rating and affordability. It also changes the House member’s committee affiliation from Economic Matters to Judiciary. The bill keeps the workgroup active longer so it can produce an updated report with concrete legislative recommendations that may later inform changes to the Insurance Article or related state insurance policy.
Sentiment
The overall sentiment appears supportive and pragmatic. The bill passed the Senate unanimously and the House with strong bipartisan support, indicating broad agreement that more work is needed on auto insurance affordability. The bill’s findings frame the issue as one of premium affordability, geographic disparity, and the need for actionable recommendations rather than further general study. The committee report was favorable with amendments, suggesting the legislature wanted to refine the workgroup’s composition and duties rather than oppose the concept.
Contention
The main point of contention underlying the bill is the use of territorial rating and other nondriving rating factors in auto insurance pricing. The bill’s findings note that the prior workgroup identified disparities in majority-minority and lower-income zip codes, but did not reach consensus on reforms or provide specific legislative recommendations. Supporters appear to want the workgroup to move beyond study and produce concrete proposals to reduce premiums and address racial and geographic disparities. Potentially affected stakeholders include insurers, insurance producers, consumer advocates, the reinsurance industry, and communities facing higher premiums; the bill’s expanded membership reflects an effort to balance those interests while still pushing toward reform.