The Massachusetts Division of Insurance (DOI) has released a report detailing the state of credit insurance in 2022, as mandated by M.G.L. c. 175, 117C(b). The report indicates a significant decline in credit insurance business over the past decade, with the market reaching approximately $2.5 million in 2022. This decrease is attributed to the rise of debt cancellation and suspension products offered by banking organizations, which are not classified as insurance and are regulated federally. The report outlines the various types of credit insurance, including credit life, credit disability income, and credit involuntary unemployment insurance, each with specific regulatory standards and loss ratio requirements.

In 2022, only three companies were actively writing credit insurance, while thirteen others were managing closed blocks of coverage. The DOI requires insurers to report claims experience and loss ratio data annually, and this year, the reported data did not meet the statutory credibility thresholds due to low premiums, meaning companies were not required to adjust rates. The report highlights the ongoing challenges in the credit insurance market, including the expectation of continued declines in premium levels and credible claims information. The DOI's oversight aims to ensure compliance with statutory minimum loss ratios, which are set at 50% for credit life insurance, 55% for credit disability income insurance, and 60% for credit involuntary unemployment insurance.