When Do You Need to Request a Hearing After an MIA Administrative Order

Insurance companies, agents, brokers and consumers have broad rights to request hearings on actions that the Maryland Insurance Administration (MIA) takes – and doesn’t take.  The MIA is required to hold a hearing when properly requested by any person that is “aggrieved”, or harmed, by an action of the Insurance Commissioner or by the Commissioner’s “failure to act”.  See Section 2-210(a)(2)(ii) of the Insurance Article (“Article”) of the Maryland Annotated Code.

The timing of these requests for hearings is critical and can seriously impact important rights.  As a general rule, the MIA’s regulations require that requests for a hearing be submitted to the Commissioner within thirty (30) days of the date of the MIA’s letter notifying the party of “the Commissioner’s action, intention to act, or failure to act.” COMAR 31.02.01.03.C(1).  The Administration has created an exception to this 30-day rule for proposed reports on market conduct examinations.  COMAR 31.02.01.03.A.  

The Commissioner’s action is not, however, stopped by the filing of a valid hearing request within thirty (30) days, even when the MIA agrees to hold a hearing.  Instead, the Commissioner must receive the hearing request before the effective date of the order or within ten (10) days of the date that the order is served (subject to some exceptions).  Section 2-212(a) of the Article.  This means that while the MIA should grant a hearing on any proper request that is submitted within thirty (30) days, the request for the hearing does not stop the Commissioner’s action from taking effect while the hearing is pending unless the hearing request is submitted before the order takes effect or within ten (10) days.  

Halting the Commissioner’s action while the hearing is pending can make all the difference.  By way of example, take the case of an insurance agent or broker who receives an MIA order revoking their license to sell insurance in Maryland.  That agent or broker will typically want to halt, or “stay”, the revocation while the hearing is pending.  If the revocation order is “stayed”, then the agent or broker’s license remains in effect while the hearing is pending.

By contrast, if this hypothetical agent or broker does not file a hearing request on the revocation in time to stay the revocation, but files the request before the thirtieth day, then the agent/broker is entitled to a hearing, but the revocation will likely go into effect while the hearing is pending (depending on the language of the MIA’s revocation determination).  The agent/broker will get their hearing, but their license will be revoked unless and until they prevail at a hearing, which can take months, or the agent or broker convinces the MIA to resolve the revocation case in a manner that permits the agent/broker to keep their license.

There is one important exception in this hypothetical. A professional must still timely renew the revoked license when the renewal period arises, even if the revocation is stayed. If the renewal application is denied, that denial becomes a separate administrative determination that is subject to separate hearing rights – and deadlines.  There are a lot of moving parts here.

Brown & Bullock routinely helps insurance companies and professionals, as well as policyholders, address the many difficult interlocking issues that arise from actions and inactions of the Maryland Insurance Administration and Commissioner. If you have questions or would like to speak with a knowledgeable attorney about your situation, we would appreciate the opportunity to speak with you.