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The Insurance Compact has received several inquiries about how it is addressing Maryland Senate Bill 168/House Bill 27, now codified at §16-119 of the Insurance Article, Annotated Code of Maryland, effective Jan. 1, 2019. The new statute establishes requirements for the content and underwriting of applications for insurance on the life of a minor. This advisory was developed in collaboration with the Maryland Insurance Administration and is dedicated to helping you navigate the new statute and how it applies to application forms filed with the Insurance Compact pursuant to the Individual Life Insurance Application Standards (IIPRC-L-I-APP).
Provisions of §16-119 that are not specific to the product or form content apply to Compact-approved products. Specifically, parts (B), (C) and (D) pertain to the administration of applications for life insurance on the life of a minor. These provisions apply to child insurance issued in Maryland regardless of whether Maryland or the Insurance Compact approved the application or coverage forms.
With the exception of Compact-approved application forms being used with Maryland-approved life insurance policies under Mix and Match, the provisions of §16-119 that create specific content requirements for application forms do not apply to application forms submitted to the Compact for approval under IIPRC-L-I-APP. Because the Uniform Standards constitute “the exclusive provisions applicable to the content” of products and forms filed with the Insurance Compact, per Art. XVI, 1b of the Compact Statute, the application form requirements established by §16-119(A) do not apply to the content of application forms filed with the Insurance Compact.
The combination of a Compact-approved application or child application supplement with a Maryland-approved insurance policy issued on the life of a child being used or filed on a Mix and Match basis may result in ambiguous or inconsistent clauses, because the child insurance coverage in this scenario is subject to Maryland product content requirements, including §16-119. Therefore, applications and child application supplements for insurance on the life of a minor filed with the Compact should be used only with insurance policy or rider forms approved by the Compact or must satisfy the provisions of §16-119 (see below on options).
The Maryland Insurance Administration has advised us they would prefer filers to include the information required in §16-119 in a Compact-approved application for insurance on the life of a minor even though not required when the application is being used with a Compact-approved product. Please note the Maryland Insurance Administration will require, in the market conduct setting, compliance with §16-119 in Mix and Match situations when a filer is using a Compact-approved application with a Maryland-approved life insurance product. Here are ways to utilize provisions within the IIPRC-L-I-APP to satisfy the provisions of §16-119 while maintaining uniformity across all the Compacting States on the filing: 

1. Add acknowledgement of receiving the prescribed statement in §16-119(A)(3) to an application form or child application supplement pursuant to §1B(1)(d) and §3K(2)(b) of IIPRC-L-I-APP. This method uses variability and permits the form to reference the specific state(s) for which a disclosure statement was provided. In other words, the application form may show the prescribed statement, or an acknowledgement that the prescribed statement was received, in brackets. Under this option, the Statement of Variability must provide that the prescribed statement or acknowledgement will appear only when the application form is used in Maryland.
    
2. IIPRC-L-I-APP permits a signature line for the parent or legal guardian of an unemancipated or unmarried minor as required under §16-119(A)(2). See IIPRC-L-I-APP, §3N(1). As a reminder, outside of the variability referenced in item 1 above, specific Compact states should not be referenced in Compact-approved forms because a key purpose of the Compact is to promote uniformity of insurance products across the Compact states. Likewise, under §16-119(B) and (C), the Uniform Standards permit questions about other in-force or applied-for insurance on the life of a minor, provided specific Compact states are not referenced in the form.

Filers wishing to update forms previously approved by the Compact for compliance with §16-119 should consult Filing Information Notice 2017-1 for the parameters applicable to revising previously approved forms. Please note applicable state fees are due for all states included in a filing. If you have any questions about this filing guidance, or filing with the Compact in general, please contact the Insurance Compact Office.