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Bill

Bill

A 3284

Requires 90 days' notice of cancellation or nonrenewal of stop loss insurance for small employer health benefits plans.

2026-2027 Regular Session

Requires insurers to give small employers 90 days' notice before canceling or refusing to renew stop loss health insurance coverage, protecting employment-based health benefits from abrupt disruption.

Introduced, Referred to Assembly Financial Institutions and Insurance Committee
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WeVote Research Nonpartisan
Bill Summary · A 3284

Legislative bill overview

Bill A 3284 mandates that insurers provide small employers with 90 days' advance notice before canceling or refusing to renew stop loss insurance policies covering their health benefits plans. Stop loss insurance protects employers from catastrophic healthcare costs by covering claims that exceed specified thresholds. This notice requirement aims to give small employers adequate time to secure alternative coverage.

Why is this important

Small employers rely on stop loss insurance to manage financial risk and maintain stable health benefit offerings to employees. A sudden cancellation or non-renewal without sufficient notice can leave employers unable to pay employee claims or forced to drastically alter coverage, destabilizing employee benefits and potentially harming recruitment and retention. The 90-day window provides employers a realistic timeframe to find replacement coverage or adjust their health plan structure.

Potential points of contention

  • Insurer flexibility concerns: Insurers may argue that strict notice requirements limit their ability to exit unprofitable markets quickly or respond to emerging risk factors, potentially reducing market participation or increasing premiums.
  • Definition ambiguity: The bill may need clarification on what constitutes a "small employer" and whether different thresholds apply, as this affects how many businesses are protected.
  • Market impacts: Extended notice periods could increase insurers' losses on policies they want to exit, potentially raising costs for remaining policyholders or discouraging new entrants to the small employer stop loss market.

Compiled from official sources — confirm details with the bill’s official record.

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