What Is "Insurance Law"?
Insurance law is the area of law that regulates sale of insurance, ensures fairness of insurance contracts--usually referred to as insurance policies--enforces their terms and otherwise pertains to the insurance industry.
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Sources of Insurance Law
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Insurance law is state specific. Activities of insurance companies within a state are regulated by state agencies usually named Department, Division or Bureau of Insurance. These agencies are responsible for enforcing certain standards known as "fair claims practices" and "fair trade practices."
What is Covered?
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State insurance laws may limit the ability of insurance companies to cancel or suspend converge under a policy. They regulate insurance companies' marketing practices, policy underwriting and claims handling. Another aspect of insurance regulation is enforcing certain liquidity standards to ensure a company's ability to meet its obligation to the policy holders.
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Other
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While the term "insurance law" normally refers to protection and enforcement of rights and obligation of policy holders and insurance companies, other insurance-related legal requirements exist. Some states, for example, prohibit operating a vehicle without auto insurance or make it mandatory for mortgage holders to purchase home owner's insurance.
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