Property and Casualty Insurance - Parametric Insurance - Regulation

SB 95 regulates parametric insurance policies in Maryland, requiring insurers to provide clear disclosures about how payouts work and potential mismatches with actual losses (called "basis risk"). It mandates annual reports to the Insurance Commissioner on policy details, trigger events, and disputes, and requires policies to use objectively measurable triggers (like floods or hurricanes) verified by independent sources. The law directly affects insurers selling these policies in Maryland and policyholders - especially low- and moderate-income households - by ensuring transparency through plain-language fact sheets and requiring two numerical examples of basis risk. Key provisions include banning vague triggers, requiring written explanations of coverage at application and renewal, and prohibiting insurers from changing underwriting rules without prior approval.