Wyoming insurance law is in Title 26 of the Wyoming Statutes, with rules adopted by the Department of Insurance in numbered chapters (for example, Ch. 20 on CE and Ch. 46 on trust accounts). Auto financial responsibility is in Title 31 and workers compensation in Title 27. This guide covers the Wyoming rules on the regulator, licensing, appointments, CE, trust accounts, inducements, unfair practices, penalties, claim payment and the guaranty associations. The general concepts are in the national Insurance Regulation guide.

About the exam

Wyoming's exams are given by Pearson VUE. You must answer 70% of the questions correctly to pass.

• No partial passes: if you fail part of a combination exam, you retake the whole exam.
• The exam tests the lines of authority, a producer's duties and Wyoming insurance law (26-9-205(a)). Exam fees are paid to the testing service.
• Crop authority is included in the Property line.
• Variable life and annuity applicants show FINRA registration and must have passed the Series 6 or 7 and the Series 63.
• Applicants provide fingerprints for a criminal history check, at their own cost (26-9-206(a)(v)).

The regulator

• The Department of Insurance is headed by the Insurance Commissioner, who is appointed by the Governor. The Governor may also remove the Commissioner and fills vacancies (26-2-102).
• The Commissioner adopts rules under the Wyoming Administrative Procedure Act. A rule may not extend or conflict with a statute. Anyone may petition for a rule.
• Every insurer is examined at least every five years, and each new applicant for a certificate of authority is examined too (26-2-116). Producers' and adjusters' records may be examined whenever advisable (26-2-117).
• Orders are effective only in writing, signed by the Commissioner or someone with authority, and state their grounds. A mailed order is given when mailed (26-2-111).
• Hearings (26-2-125 to 26-2-128):
  • A hearing request is filed within 90 days of learning of the act or order.
  • The hearing is held within 30 days, with at least 10 days' notice.
  • The order follows within 30 days after the hearing (60 if transcribed).
• Emergency cease and desist orders require significant, imminent and irreparable harm. An emergency order lapses after the second business day unless a TRO is obtained or the person agrees. A cease and desist order becomes final 11 days after receipt if no hearing is requested within 10 days (26-2-130).
• Insurers:
  • An insurer needs a certificate of authority (26-3-101).
  • A new foreign insurer generally must have issued its own policies as an authorized insurer for two years (26-3-105).
  • No foreign insurer owned or controlled by a government may be authorized (26-3-104).
• Types of insurers (26-1-102):
  • domestic: formed in Wyoming
  • foreign: formed elsewhere
  • alien: formed outside the U.S.
  • reciprocal: subscribers operating through an attorney-in-fact
  • fraternal benefit society: works on a lodge system
• Premium includes any fee charged for the insurance, whatever it is called.

Producer licensing (Title 26, ch. 9)

Definitions (26-9-202):

• Sell means exchanging a contract of insurance for money on an insurer's behalf.
• Solicit means attempting to sell, or urging a person to apply for a particular kind of insurance from a particular insurer.
• Negotiate means conferring with or advising a purchaser about a contract's terms.
• The license gives no authority to bind an insurer. That comes from an appointment.

Lines of authority (26-9-207(a)):

• life
• accident and health
• property
• casualty
• variable life and variable annuity
• personal lines

Applicants (26-9-206):

• An individual must be at least 18.
• A business entity designates a licensed producer responsible for compliance.

Not required to be licensed (26-9-204) include:

• non-commissioned employees doing clerical work or underwriting, loss control or claims
• a nonresident selling commercial coverage to a multistate insured headquartered in the producer's home state

Nonresidents and movers:

• Nonresidents are licensed by reciprocity (26-9-208). Accepting a nonresident license appoints the Commissioner to receive service of process.
• A resident moving away files within 30 days.
• A producer moving to Wyoming applies within 90 days, with no exam for lines held (26-9-209).

Temporary licenses last up to 180 days (26-9-210). They can go to:

• a surviving spouse or representative
• an entity member after its designee dies or becomes disabled
• the designee of a producer entering active military service

The Commissioner may require a sponsor.

Brokers and consultants:

• A producer acting as a broker isn't the insurer's agent and can't bind it (26-9-224). With an insurer that has appointed them, the producer is that insurer's agent (26-9-225).
• A consultant gives advice for a fee and isn't paid by insurers or producers for it. A consultant license lasts up to 24 months. A dual licensee can't act as both producer and consultant in the same transaction. Attorneys are exempt (26-9-220).

Other licensing rules:

• Assumed names must be reported to the Commissioner before use (26-9-233).
• A resident producer keeps a place of business in Wyoming open to the public, which may be in the home (26-9-228).
• No city or county may require any further permit (26-9-227).

Renewal and CE

Continuation (26-9-207(b)):

• An individual license continues if, by the last day of the licensee's birth month in the second year, the fee is paid and CE is done.
• It may be reinstated within 12 months without an exam by paying a penalty equal to the continuation fee.
• Licensees in military service may ask for a waiver.

CE (26-9-231; Ch. 20):

• 24 hours every two years, including 3 hours of ethics.
• Up to 12 carry-over hours, earned in the 120 days before the continuation date, may count toward the next period. Carry-over hours never count as ethics.
• The same course can't be credited more than once every 48 months.
• Sales, motivation, prospecting and exam-prep courses don't count.
• Each credit hour requires at least 50 minutes of instruction. Self-study requires passing a monitored exam with 70%.
• Instructors earn hour-for-hour credit.
• The Commissioner may grant an extension of up to one year for good cause. A license isn't renewed until CE is done.
• Exempt: nonresidents and licenses that require no exam.

Reporting and appointments

• Contact changes (name, address, phone, email): within 30 days (26-9-207(f)).
• Administrative action elsewhere: within 30 days of final disposition (26-9-216(a)).
• Criminal prosecution: within 30 days of the initial pretrial hearing (26-9-216(b)).
• Appointments (26-9-213):
  • Filed within 15 days of the agency contract or first application.
  • A producer not acting as an insurer's agent needs no appointment.
  • Insurers pay continuation of appointment fees by March 31, or the appointments terminate.
• Terminations (26-9-214): the insurer notifies the Commissioner within 30 days and mails the producer a copy within 15 days. The producer has 30 days to comment.
• Commissions go only to licensed persons. Renewal commissions may go to someone licensed at the time of sale (26-9-212).

Premium trust accounts (26-9-229; Ch. 46)

• Premiums and return premiums are trust funds held in a fiduciary capacity. Diverting them is embezzlement.
• Premiums go in a separate trust account:
  • at a qualified financial institution in Wyoming
  • non-interest-bearing
  • bank fees paid from the licensee's own money
  • reconciled monthly
• Funds go into the trust account by the close of the fifth business day after receipt.
• Premiums less commission are remitted by the contract due date, or within 45 days if there is none.
• Return premiums are paid or credited to the insured within five business days.
• No trust account is needed if the licensee never holds funds, as with direct-billed policies.
• Transaction records are kept at least three years (26-9-228(c)).

Controlled business (26-9-226)

A license is used principally for controlled business when commissions on the producer's own, family's or employer's insurance exceed commissions on other business in 12 months. Receiving the excess commissions is an unlawful rebate. Mortgagee interests, auto dealer and finance interests, and credit life and disability are excepted.

Unfair practices (26-13)

• Misrepresentation, including misleading policy names (26-13-103).
• Twisting, including misleading comparisons to induce someone to retain a policy (26-13-105).
• False financial statements, such as advertising assets without showing liabilities (26-13-106).
• Defamation (26-13-107).
• Boycott, coercion and intimidation (26-13-108).
• Unfair discrimination (26-13-109).
• Rebating (26-13-110), with these exceptions:
  • Non-cash gifts up to $100 or 5% of the premium, capped at $1,000, per customer per calendar year. Gifts can't depend on a purchase or renewal.
  • Raffles and drawings open to the public with no purchase, worth no more than $100 each.
  • Value-added services tied to the coverage, such as loss mitigation or health enhancement. A pilot program may run up to one year after notice to the Department.
  • Insurance may not be offered as an inducement to buy another policy, and ads can't call it "free" or "no cost."
• Unfair claims practices done as a general business practice (26-13-124), for example:
  • compelling insureds to sue by offering far less than they ultimately recover
  • asking for duplicate proof of loss forms
  • not explaining a denial
• Senior designations that are self-conferred or not earned are prohibited (Ch. 62).
• Soliciting military members on duty, door to door or in captive audiences is prohibited (Ch. 60).
• Making a false statement on an application or presenting a false claim is a violation (26-13-201).

Penalties

Grounds for license action (26-9-211) include:

• false application information
• forgery
• using notes on the exam
• a felony related to insurance
• revocation in another state
• unpaid child support

Claim payment (26-15-124)

• Life and health claims are paid or denied within 45 days after proof of loss.
• P&C claims are paid or denied within 45 days after the claim and supporting bills are received.
• An unreasonable refusal lets the court award attorney fees and 10% interest.

Privacy (Ch. 54)

• A privacy notice is given when the customer relationship begins and annually afterward. Former customers don't get annual notices.
• Health information needs the consumer's authorization to be disclosed, except for listed insurance functions.

Guaranty associations

• Wyoming Life and Health Insurance Guaranty Association (26-42):

  • $300,000 life death benefit ($100,000 cash value)
  • $250,000 annuities
  • $300,000 health benefit plans, disability and LTC
  • $100,000 other health
  • $500,000 aggregate per life
  • $5,000,000 for one owner of several policies

  A disclaimer is given at or before delivery, and the association can't be used in sales.

• Wyoming Insurance Guaranty Association (26-31), for P&C:

  • $300,000 per claim
  • unearned premium up to $7,500
  • workers compensation claims paid in full
  • assessments capped at 1% of premium
  • It excludes life, title, surety, disability, credit, mortgage guaranty and ocean marine.

Common exam traps

• The Commissioner is appointed by the Governor.
• CE is 24 hours with 3 ethics. Up to 12 carry-over hours are allowed, and they never count as ethics.
• Appointment fees are due March 31.
• The trust account must be in a Wyoming institution and can't earn interest. Deposits are due within 5 business days.
• Gifts are capped at $100 or 5% of premium, up to $1,000 a year. Raffles are capped at $100.
• Claims are paid or denied within 45 days, with 10% interest if refused unreasonably.
• P&C guaranty coverage pays workers comp claims in full. Unearned premium is capped at $7,500.