IT IS A PROHIBITED UNFAIR CLAIMS PRACTICE FOR PROPERTY OR HOMEOWNER’S INSURERS AND PRODUCERS TO TREAT AN APPLICANT’S OR INSURED’S INQUIRY RELATING TO DAMAGE OR LOSS AS A CLAIM WHEN THE FACTS OF THE INQUIRY ARE NOT COVERED BY THE POLICY WHERE CERTAIN ELEMENTS ARE MET

STATE OF NEW MEXICO OFFICE OF SUPERINTENDENT OF INSURANCE SUPERINTENDENT OF INSURANCE Alice T. Kane DEPUTY SUPERINTENDENT Timothy Vigil SANTA FE LOCATION (MAIN OFFICE) (OVERNIGHT/SECOND DAY MAIL ONLY) 1120 Paseo De Peralta, 4th Floor Santa Fe, New Mexico 87501 (USPS MAIL ONLY) P O Box 1689 Santa Fe, New Mexico 87504 Main Phone: (505) 827-4601 | Toll Free: (855) 4 - ASK - OSI www.osi.state.nm.us BULLETIN 2025-010 OCTOBER 21, 2025 TO: ALL PROPERTY AND HOMEOWNER'S INSURANCE CARRIERS COVERING RISKS LOCATED IN THE STATE OF NEW MEXICO RE: IT IS A PROHIBITED UNFAIR CLAIMS PRACTICE FOR PROPERTY OR HOMEOWNER'S INSURERS AND PRODUCERS TO TREAT AN APPLICANT'S OR INSURED'S INQUIRY RELATING TO DAMAGE OR LOSS AS A CLAIM WHEN THE FACTS OF THE INQUIRY ARE NOT COVERED BY THE POLICY WHERE CERTAIN ELEMENTS ARE MET THIS BULLETIN is effective immediately and is issued pursuant to Sections 59A-2-8, 59A-2-10, and 59A-4-3 NMSA 1978 and 13.1.2.9 NMAC. The Office of Superintendent of Insurance expects all property and casualty insurance companies to act in good faith and to use fair claims practices that comply with state law. The purpose of this Bulletin is to advise insurers that the Insurance Code's Unfair Claims Practices law, Section 59A-16-20 NMSA 1978, was amended in 2025 with an effective date of June 20, 2025. Article 16 of the Insurance Code [NMSA 1978, Sections 59A-16-1 to 59A-16-30 (2025)] regulates trade practices in the insurance business and related businesses by defining practices in this state which constitute unfair methods of competition or unfair or deceptive acts or practices. See NMSA 1978, Section 59A-16-2. Effective on June 30, 2025, Subsection P was added as a new prohibited unfair claims practice. Bulletin No. 2025-010 P a g e | 2 SANTA FE LOCATION (MAIN OFFICE) (OVERNIGHT/SECOND DAY MAIL ONLY) 1120 Paseo De Peralta, 4th Floor Santa Fe, New Mexico 87501 (USPS MAIL ONLY) P O Box 1689 Santa Fe, New Mexico 87504 Main Phone: (505) 827-4601 | Toll Free: (855) 4 - ASK - OSI www.osi.state.nm.us 59A-16-20. Unfair claims practices defined and prohibited. Any of the following practices with respect to claims, by an insurer or other person, knowingly committed or performed with such frequency as to indicate a general business practice are defined as unfair and deceptive practices and are prohibited: * * * P. treating an insured's inquiry relating to damage or loss as a claim when the facts of the inquiry are not covered in the policy, the insurer makes no payment to or on behalf of the insured and the claim does not involve deceptive practices on the part of the insured[.] It has come to the attention of the Superintendent that property and casualty Insurers may be treating applicants for property insurance coverage differently than their insureds with respect to claims under an insurance policy for which zero payments were made. Specifically, Insurers may be treating a property insurance applicant's zero payment inquiry as a prior loss during the application process. The prohibited unfair claims practice defined in 59A-16-20(P) applies to all persons including insureds and applicants for a property insurance policy, in line with the spirit of the unfair trade practice law that prohibits treating applicants and insureds differently under NMSA 1978, §59A-16-12(B). Under the new law, Insurers are prohibited from categorizing as claims any inquiries made by any policy applicant or insured relating to damage or loss when the facts of the property insurance inquiry are not covered in the Insurer policy, when no payment is made by the Insurer on behalf of the applicant or the insured, and the inquiry does not involve deceptive claim practices on the part of the applicant or the insured. For example, it is an unfair claims practice for an Insurer to penalize an applicant or insured who makes an inquiry about property insurance coverage or who seeks to obtain a denial letter from any property Insurer for any reason, including as a requirement to claim federal or state benefits after a declared catastrophe. In such situations, the Insurer is prohibited from treating the inquiry or request as a claim or as an applicant's prior loss, is prohibited from raising a policyholder's premiums or denying an applicant or a policyholder coverage or penalizing an applicant or insured in any other way because of the inquiry or request addressed by 59A-16-20(P). Should you have any questions relating to this bulletin, please contact Melissa Robertson by emailing Melissa.Robertson@osi.nm.gov or by calling (505) 670-2704. Bulletin No. 2025-010 P a g e | 3 SANTA FE LOCATION (MAIN OFFICE) (OVERNIGHT/SECOND DAY MAIL ONLY) 1120 Paseo De Peralta, 4th Floor Santa Fe, New Mexico 87501 (USPS MAIL ONLY) P O Box 1689 Santa Fe, New Mexico 87504 Main Phone: (505) 827-4601 | Toll Free: (855) 4 - ASK - OSI www.osi.state.nm.us ISSUED this 21st day of October, 2025. _________________________________ ALICE T. KANE Superintendent of Insurance