J J Silverstein, a Partner with Foley & Lardner, LLP presented at the June 2026 Summer Membership Meeting on ethical issues and standards in dealings with insurance regulatory agencies. There are all sorts of interactions with regulators: written, informal, formal, emails, product filings, and financial and other required disclosures. Navigating the tension between reporting obligations and communications with insurance regulators and an attorney’s confidentiality obligations to the client not to disclose protected, privileged information was a focal point of the presentation, as well as the applicable ABA Model Rules that would apply to such regulatory interactions. A replay of this presentation is available to members through the AIRROC On Demand platform.
Below are some of the key takeaways from the presentation:
- The main ABA Model Rules that apply to interactions with insurance regulators include: 3.9 advocate in non-adjudicated proceedings; 1.6 confidentiality; 3.4 fairness to opposing party and counsel; 3.5 impartiality and decorum of the tribunal; and 4.1 truthfulness in statements to other.
- While the NAIC has a code of conduct for behavior at NAIC meetings, there are no known individual state departments of insurance codes of conduct for ethical practice before them.
- Most of the ABA Model Rules tend to contemplate the presentation of information to a tribunal in the context of an adjudicated proceeding and do not align with the day-to-day interactions with insurance regulators. Application of some rules are straightforward while others are not so clear as to their practical application in less formalized interactions with regulators, such as in the case of negotiations, a bilateral transaction, application for a license, investigation or examination of a client’s affairs and general compliance requirements.
- If the agency is acting in a rulemaking or policy capacity, there is an obligation to incorporate formalized adjudicative proceeding Model Rules. For example, a submission of a comment letter on the promulgation of a rule would fall within the scope of the more formalized ABA Model Rules.
- Real world scenarios were examined to connect abstract concepts to concrete application of the ethical requirements and to illustrate some of the imprecise language of the ABA Model Rules when applied to an insurance regulatory context.
