A coalition of Democratic mayors, liberal advocates and physicians are suing the Trump administration over new rules designed to “undermine” the Affordable Care Act.

A Maryland judge announced a hasty briefing schedule Wednesday to hear the case in advance of the new rules’ Aug. 25 effective date.

The Centers for Medicare & Medicaid Services rolled out the changes last month, which include a shortened enrollment period, more stringent income verification checks, and a $5 fee for some people who automatically re-enroll in a free plan.

Insurers will also be able to deny coverage to people who have not paid their premiums on past plans. The rules also bar roughly 100,000 immigrants who were brought to the United States as children from signing up for the coverage.

The “Marketplace Integrity and Affordability” rule would result in more than 2.2 million Americans losing their health coverage, claimed Democracy Forward, the liberal advocacy group leading the litigation.

Plaintiffs include the mayors of Baltimore, Chicago and Columbus, Ohio and a pair of liberal groups — Doctors for America and Main Street Alliance.

“Paying more for less is always a bad deal, but that’s exactly what the president is proposing for health care coverage—a bad deal for working people, families, and cities that rely on the Affordable Care Act to decrease costs and increase accessibility,” said Columbus City Attorney Zach Klein.

The CMS did not respond to a message seeking comment on the lawsuit. In finalizing the rule, CMS officials said it will lower individual health insurance premiums by about 5% on average. It is also projected to save taxpayers up to $12 billion in 2026 by “combating the surge of improper enrollments in the [ACA],” the CMS said in a news release.

Liberal groups allege APA violations

Filed in U.S. District Court for the District of Maryland, the lawsuit alleges violations of the Administrative Procedure Act. That is an important distinction as the plaintiffs seek a nationwide injunction preventing the rule from taking effect.

In a June ruling, the Supreme Court declared that lower-court universal injunctions “likely exceed the equitable authority that Congress has granted to federal courts.” However, that decision left an exception in place for APA challenges.

The CMS rule limits ACA enrollment to Nov. 1 to Dec. 15 in 2026, a reversal of the Biden administration’s approach. The previous administration expanded the enrollment window, which led to record enrollment of more than 24 million.

Plaintiffs say that the new policies were introduced without an adequate public comment period on the proposals.

CMS published a proposed version of the rule on March 19, 2025, and received more than 26,000 comments, despite a shortened 23-day (rather than 30-day) formal comment period, the lawsuit said.

“This unlawful rule will force families off their health insurance and raise costs on millions of Americans. This does nothing to help people – and instead harms Americans’ health and safety across our country,” said Skye Perryman, president and CEO of Democracy Forward. “Americans deserve a government that protects their health, not one that puts it at risk.”

Accelerated timeline

Judge Brendan Abell Hurson ordered CMS and related co-defendants to respond to the motion for an injunction by July 16 and plaintiffs to reply by July 30.

The Trump administration claims that the ACA marketplace is riddled with fraud due to expanded subsidies, or tax credits that keep Americans’ monthly premiums low. Millions of Americans are enrolling in those low-cost plans even if their income makes them ineligible for heavily subsidized plans, according to conservative think tank Paragon Health Institute.

Congress expanded those subsidies in 2021 during the COVID-19 pandemic, but the temporary tax credits are set to expire at the end of 2025.

Plaintiffs counter by pointing out that the rule raises the cost of coverage by manipulating formulas that will raise premiums and out-of-pocket costs for millions, while reducing benefits. It adds up to people paying more for less, the liberal groups say, and allows insurers to refuse to enroll people over old debts as low as $10, without notice.

“This rushed ACA Marketplace rule claims to fix enrollment abuses, but instead of cracking down on predatory brokers, it punishes families,” said Dr. Janet Krommes, Doctors for America.

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Tariffs have impacted Morningstar’s third-quarter economic outlook, with predictions that they will push gross domestic product forecasts downward while increasing inflation.

Preston Caldwell, Morningstar Investment Management chief U.S. economist, discussed the impact that tariffs will have on the U.S. economy in the near-term during a recent webinar.

Morningstar’s economists continue to expect that the U.S. will avoid a recession while the annual inflation rate reaches the Federal Reserve’s target of 2%.

Caldwell predicted GDP for 2025 will grow by 1.7% and dip to 1.1% growth in 2026. In comparison, GDP growth for 2021 was 6%. Inflation is expected to be 2.7% in 2025 and rise to 3.2% for 2026, compared to a high of 6.6% in 2022.

“I think tariffs will ultimately cause an upward shift in prices, peaking in 2026,” he said. “After that, GDP growth will push inflation down, beginning in 2028.”

As for interest rates, Caldwell said he expects to see substantial further monetary policy loosening, with two interest rate cuts before the end of 2025, three in 2026 and another three in 2027.

Morningstar research showed a half-percentage point decline in GDP annualized quarter over quarter in the first quarter of 2025, Caldwell said. But he said that doesn’t foreshadow an economic slowdown “because the bulk of the decline was driven by a surge in imports, which subtracts from net exports, and in theory that should have been fully offset by higher accumulation of inventories,” he said. “Because all this surge of imports was coming into the country to beat the tariffs. Those goods have to be stored somewhere in inventories, but it just didn’t show up in the data because of measurement error, which is not an unusual thing with the quarterly data.”

Taking that data out of the equation, first-quarter GDP was up on a quarter-over-quarter basis, he said. GDP is likely to rebound in the second quarter, although there are signs that consumers are more cautious about spending. Weaker consumer consumption combined with the tariff impact will lead to decelerating GDP growth later in the year.

Tariffs impact supply and demand

Tariffs bring both supply shocks and demand shocks, Caldwell said. From the supply side, tariffs put a drag on economic efficiency. On the demand side, they lead to fiscal contraction and uncertainty. Together, they pull down GDP.

So far, foreign companies have not paid the tariffs, he said. Right now, U.S. importing firms are paying for most of the tariffs, but not for long.

“I don’t think that’s sustainable,” he said. “Ultimately, the bulk of that cost will have to be passed on to consumers.”

Dave Sekera, Morningstar Research Services’ chief U.S. market strategist, said he believes there is still a lot of potential market volatility ahead in the next two months.

Markets often act like a pendulum, he said. Stocks began the year at a rare premium, plummeted to a rare discount and rallied back. Trade negotiations, the upcoming earnings season and the slowing rate of economic growth may lead to summer volatility.

“This is a great time to take a fresh look at your portfolio, look at your allocations and make sure they are balanced going forward,” he said.

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From dusting off their resumes to going off-grid, Americans are bracing themselves for a possible recession this year.

A report from Howdy reveals that 67% of Americans are already changing their day-to-day habits in anticipation of an economic downturn. More than 3 in 4 (76%) are changing their financial habits due to the current economic climate: 61% are cutting back on spending, 52% are increasing savings, and 38% are paying off existing debts.

These steps may reflect growing concerns about job security as well: more than 1 in 4 Americans say they’re not confident they could find another job within three months of losing their current one.

More than half of Americans (52%) said they believe a recession will come within a year, and they are speaking out about their fears. Twenty percent have discussed a potential recession with their children, and 11% brought up recession anxiety with their therapists.

Others are preparing less for a recession and more for what feels like the end of the world. Nearly 1 in 3 (29%) are considering homesteading. Another 1 in 3 are considering buying an off-grid property. 16% claim to have built a bunker in anticipation of a recession.

Recession-proofing jobs

The majority of Americans (79%) are optimistic about the chances of their jobs surviving a recession. However, 1 in 4 are not confident they’d be able to find another job within three months of losing their current one.

But those who fear their jobs could be in danger aren’t sitting around waiting for the worst to happen. The study showed many Americans are taking steps to recession-proof their jobs, including:

• Expanding skillset to include technology such as artificial intelligence (51%)
• Networking (48%)
• Updating and enhancing resumes (45%)
• Obtaining technical certifications (41%)
• Working freelance jobs on top of their primary job (36%)

Making positive financial changes

More than one-third of Americans (37%) are making positive changes to recession-proof their finances. Top financial moves include transferring stocks to more stable investments like bonds or cash (47%) and paying off high-interest debt (39%).

Tech workers are less likely to fear recession rumors. Only 47% think that a recession will happen within 12 months, and 82% think their jobs would survive a recession.

However, tech workers are taking action in case a recession occurs. More than half (58%) are currently pursuing professional certifications or classes while 78% have adjusted their household budgets to prepare for a recession. Half are considering investing in off-grid property, and 37% are thinking about homesteading. Additionally, 1 in 4 has a bunker for their family.

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After five years, many advisors and brokers remain divided on the Securities and Exchange Commission’s Regulation Best Interest.

Known colloquially as Reg BI, the rule was developed under the first Trump administration and left to stand by the Biden-era Securities and Exchange Commission leadership. It commits the industry to its preferred best-interest standard.

But some industry experts consider it a work in progress, even after five years. The SEC has brought only a handful of headline Reg BI cases and most discipline sits with the Financial Industry Regulatory Authority, said Lawrence Klayman, founding partner at Klayman & Toskes, a securities law firm.

Those FINRA penalties rarely exceed six figures, Klayman added, calling the fines “hardly a deterrent for large broker-dealers.”

“Reg BI is a glass-half-full,” Klayman said. “It pushed brokers to produce cleaner disclosure and collect mountains of documentation, yet the rule’s bite still feels more like a questionnaire than a guard dog.”

But advisors who have long been fiduciaries, like Richard E. Craft, CEO of Wealth Advisory Group, are happy to see standards rising for non-fiduciaries in the business.

“I think it serves as a reminder to people in your day to day business and you’re making recommendations, you trust that people are ethical and they do have the best interests of clients,” Craft said. “But having a regulation which you could violate and get yourself in trouble I think is a lot more formalized than simply not having anything that particularly shines a spotlight on it.”

Four conditions to be met

Proposed in 2018 and adopted a year later, Reg BI took effect on June 30, 2020. It falls under the Securities Exchange Act of 1934 and requires four conditions:

Disclosure. Broker-dealers must provide certain disclosures to clients before making investment recommendations or when the recommendation is made. This disclosure must include all material facts about the investment products or services being recommended.

Care. The care obligation requires broker-dealers to exercise reasonable diligence, care and skill when making investment recommendations.

Conflict of interest. Broker-dealers must establish, maintain and enforce written policies and procedures to prevent conflicts of interest and address them when they occur.

Compliance. The SEC also requires broker-dealers to establish policies that ensure compliance with the regulation, including record-making and recordkeeping requirements.

“Some advisors still wrestle with fuzzy concepts like ‘reasonably available alternatives,’ and recent surveys show compliance teams debating what documentation is truly required,” Klayman noted.

After five years, those “core components” of disclosures, avoiding conflicts and doing due diligence are areas of focus for both regulators and firms, said A. Valerie Mirko, partner and leader of Armstrong Teasdale’s Securities Regulation and Litigation practice.

A new industry around compliance technology continues to mature as firms ponder strategies.

This “can lead to trouble spots when comparing firms that have optimized technology for Reg BI compliance versus firms that have not,” Mirko explained. “Both types of firms are complying, but the firms that are leveraging technology less may not be able to track certain items at the same level of granularity than more technology-forward firms.”

There are a number of Reg BI-related technology solutions including, tracking reasonably available alternatives, cataloguing conflicts, or managing the flow of information to individual financial advisors as part of meeting and documenting compliance, Mirko noted.

The SEC set its 2025 examination goals to focus on the use of artificial intelligence and other emerging technologies. “Examinations relating to Reg BI may focus on recommendations using automated tools or other DEPs [digital engagement practices]” the agency announced in November.

‘Derisked the business’

Despite ongoing challenges and critics, Reg BI has changed the business, Mirko said.

“There is generally a sense about industry firms that Reg BI has derisked the business,” she explained. “For example, securities that may have in the past be the reason for arbitration complaints now are simply no longer on the product shelf.”

The critic’s corner includes former SEC commissioner Robert Jackson, Jr., who cast the lone vote against Reg BI. In comments made last year, he repeated comments made in 2019 that the rule is “muddled” and “vague.”

“The rule never defines what it requires firms to do to meet a best interest standard,” Jackson said during a panel hosted by the Institute for the Fiduciary Standard. “It doesn’t say what kinds of harmful conflicts firms are prohibited from engaging in. It’s not clear to me whether enough has been done to give firms direction on that.”

Klayman advocates for two fixes to “move the needle” on Reg BI.

“First, give investors a private right of action so the rule isn’t enforced solely by regulators’ bandwidth,” he said. “Second, require firms to show a client-level cost–benefit analysis for complex or high-fee products, not just a comparison checklist. Until those changes arrive, Reg BI feels more like a well-intentioned disclosure upgrade than a full fiduciary standard. It’s progress, but not yet the safety net the SEC envisioned.”

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Dr. Emmanuel Hostin, husband of TV personality Sunny Hostin, settled with American Transit Insurance Co., and the insurer dropped him from its medical fraud lawsuit.

American Transit filed a stipulation of voluntary dismissal Tuesday for Hostin and Hostin Orthopaedics & Sports Medicine.

Hostin’s attorney, Daniel Thwaites, did not return a message left with his office on Wednesday. Thwaites steadfastly proclaimed Hostin’s innocence for months.

American Transit, which insures taxi companies and Uber and Lyft drivers, filed a civil lawsuit Dec. 17. The lawsuit lists dozens of surgical centers, orthopedic services, and doctors and is reported to be one of the largest Racketeer Influenced and Corrupt Organizations Act cases ever filed in New York.

American Transit seeks to recover compensatory damages in excess of $153 million and treble damages in excess of $459 million. It has now settled with 161 of 180 initial defendants, according to court documents.

The insurer alleges that Hostin, who owns Hostin Orthopaedics, performed surgeries at other ambulatory surgical centers and billed American Transit through each of those entities “in exchange for kickbacks and/or other compensation which were disguised as dividends or other cash distributions” for an investment Hostin has in Empire State ASC, the lawsuit claims.

No-fault law blamed

American Transit traces its complaint to New York’s no-fault law, which states that plaintiffs are required to pay for health service expenses that are “reasonably incurred as a result of injuries suffered by occupants of their insureds’ motor vehicles, pedestrians, and bicyclists,” the lawsuit said.

Enacted in 1974, the no-fault law requires insurers to compensate covered persons for “basic economic loss,” which includes medical costs, incidental costs, and lost earnings. Across the country, officials are taking a closer look at no-fault laws enacted during the 1970s.

Personal line auto insurers that insure personal or private passenger vehicles are required to provide benefits up to $50,000 per person. Commercial auto insurers are required to provide up to $200,000 per person.

The alleged fraud was led by a group of ambulatory surgical centers from 2009 to the present, the lawsuit claims. Injured people were first treated at clinic, then transferred to an ASCs for “orthopedic and/or pain management evaluations,” the lawsuit said.

American Transit names 5,800 people who received such treatment “as part of the predetermined fraudulent protocol of treatment.”

The goal of the alleged fraud was always “to maximize reimbursement from insurers in general, and Plaintiff in particular, for No-Fault benefits for medically unnecessary services,” the lawsuit said.

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UnitedHealth Group is facing another round of shareholder lawsuits citing the alleged Medicare fraud investigation reported by The Wall Street Journal in May.

Steve Silverman, a UHG shareholder since 2003, filed a second shareholder derivative lawsuit last week in U.S. District Court for the District of Minnesota.

A shareholder derivative suit is a lawsuit filed by a shareholder on behalf of a corporation against its own directors, officers or even third parties, with the litigant alleging that the corporation has been harmed by their actions.

Silverman alleges breaches of fiduciary duties, insider trading, unjust enrichment and violations of the Securities Exchange Act of 1934. Defendants include returning CEO Stephen J. Hemsley, former CEO Andrew Witty, and several current and former board members.

Silverman’s lawsuit cites several media reports on UnitedHealth’s “questionable billing tactics,” culminating with a May 14 Wall Street Journal scoop that the Department of Justice was preparing to initiate a criminal investigation into the insurer.

“Despite repeated warnings, UnitedHealth’s reliance on inflated coding practices continued through at least 2023 and apparently into 2024,” Silverman’s lawsuit claimed. “These tactics yielded billions of dollars in excessive reimbursements, a sum so large that it vastly inflated the Company’s financial results and stock price.”

UnitedHealth did not respond to a request for comment.

The Department of Justice began investigating the health insurer last summer, The Wall Street Journal reported, citing unnamed people familiar with the matter. In a widely distributed statement following the WSJ May story, UnitedHealth said the DOJ has not notified it of any investigation.

“We stand by the integrity of our Medicare Advantage program,” the statement added.

Other shareholder lawsuits

Shareholder Joseph Crognale filed a similar lawsuit June 30 against the same 14 defendants named in the Silverman complaint. Likewise, shareholder Merry Kogut filed a June 14 shareholder derivative lawsuit alleging ongoing fiduciary lapses by Hemsley, Witty and seven board members.

Kogut repeats claims that UnitedHealth executives and board members failed to disclose a DOL investigation into the insurer in late 2023. In the four-month interim, defendants “breached their fiduciary duties by causing UnitedHealth to repurchase its own stock at prices that were artificially inflated due to the foregoing misrepresentations,” Kogut’s complaint said.

“Between April 2022 and February 2024, UnitedHealth repurchased approximately 14 million shares of UnitedHealth common stock, costing the Company approximately $7.3 billion,” the lawsuit stated.

Kogut alleges that Hemsley reaped $211.5 million from UHG shares sold while the DOJ investigation remained unknown to the public. Witty made $11 million from share sales, Kogut claimed.

Payment practices questioned

All three lawsuits focus on investigations into UnitedHealth’s Medicare billing practices and the associated reporting. The insurer’s Medicare business proved lucrative but also generated negative publicity that damaged share prices, plaintiffs said.

For example, in an Aug. 4, 2024, article titled, “The One-Hour Nurse Visits That Let Insurers Collect $15 Billion From Medicare,” The Wall Street Journal detailed how UnitedHealth’s software frequently suggested obscure, high-reimbursement conditions, the Silverman lawsuit said.

A former nurse recalled being prompted to diagnose hyperaldosteronism, a rare condition seldom found in Medicare Advantage patients. Between 2019 and 2021, this diagnosis was logged 246,000 times through in-home assessments, Silverman noted, producing $450 million in added payments.

Since 2016, UnitedHealth Group has been a defendant in a False Claims Act lawsuit related to a whistleblower complaint of improper coding, Silverman noted. The False Claims Act permits private parties to sue on behalf of the United States for false claims for government funds, and to receive a share of any recovery. The False Claims Act permits the government to intervene.

UHG repeatedly acknowledged the FCA lawsuit, beginning with a 2017 Form 8K filing, Silverman noted, “making it a consistent point of disclosure and an unmistakable red flag to its Board.”

“The ongoing FCA litigation should have prompted the Board to curb the Company’s upcoding practices,” Silverman’s lawsuit stated. “However, the Individual Defendants allowed these behaviors to persist well after they came under public and legal scrutiny.”

UnitedHealth is reeling from a tsunami of bad news. The insurer is expected to report second-quarter earnings on July 29, along with a revised earnings guidance for investors. Witty resigned May 12 and UHG abandoned the earnings guidance it issued less than four weeks earlier.

Hemsley, who led UHG from 2006 to 2017, emphasized the discipline he is bringing back, along with “a fresh perspective.”

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While there has been a dip in deal volume for the first half of the year, sustained interest in insurance and a “unique” surge in megadeals reflect a trend of “the consolidation of consolidators,” according to Mark Friedman, lead, U.S. insurance deals practice, PwC.

He spoke with InsuranceNewsNet on the heels of PwC releasing its US Deals 2025 Midyear Outlook report.

“Brokerage is still very attractive. I would say, historically, the buyers of those were private equity. We’ve seen a bit more focus in some of the larger strategics looking to grow or accelerate their growth trajectory by doing megadeals. But if you include the one announced [recently], which is not included in the publication, you have four of the five largest public brokers having announced megadeals in excess of $5 billion, which is a bit unique,” Friedman said.

He explained that brokers likely saw an opportunity to act, with the cost of funds for private equities having increased over the last few years and interest rates reaching a favorable point. This presented an opportunity for them to start buying larger assets that had been private-equity backed.

“That’s an iteration of a trend that we’ve been talking about for years now in the consolidation of the brokerage space. This is more consolidation of the consolidators. And, if you notice, deal volumes are down — there were less small deals in the six-month period — but a lot more bigger deals. So, it’s a bit of a catch up, if you will,” Friedman said.

Factors impacting activity, consolidation

Friedman suggested that one of the main reasons why deal volume has lulled somewhat is because “when the consolidators are consolidating, a lot of their attention is not focused on doing some of those smaller deals.”

“I think that could contribute somewhat to it. The other thing is, a lot of brokers are PE-backed and highly levered, and with rates where they are, it’s put a bit of a strain. So, insurance brokers have been spending a lot of time looking at their back office functions and trying to figure out ways to extract costs,” he added.

As such, while there is still interest and benefits of scale, Friedman said brokers have generally been “focused on other things” other than acquisition and consolidation while hoping rates will come down and the cost of financing will go up.

“As deals start to get announced with healthy valuations, a couple of IPOs announced, we’re starting to see more insurance companies look internally at their businesses and assess whether there are businesses that are subscale, non-core or that we could get a better return for our shareholders or investors by selling versus holding and continuing to invest in those businesses,” he said.

More interest in P&C

Despite the overall lull in activity, PwC noted sustained strategic interest in P&C driven by record-high profitability.

“With rates up where they are now, and coupled with a pretty strong rate market, just given inflation and some of the losses insurance companies took over the last couple of years, we’re seeing record profitability on the P&C insurance side. That’s piqued the interest of investors… So, we’re now seeing, I’d say, firing at all cylinders,” Friedman said.

He said brokers and MGAs continue to be “very hot,” and life and annuity continue to be strong, although the structure of those deals has shifted somewhat.

“There’s a lot more alternative capital vehicles coming into play versus straight buyouts of platforms or operating companies, and that’s where capital is getting deployed. And now we’re starting to see a fair amount of interest on the PNC side, and that’s driving deal activity,” Friedman said.

Projections

Looking forward, PwC expects to see broker M&A activity take off in terms of both size and scale, putting pressure on those who have not done deals yet.

“If you’re not growing in this environment, you’re essentially contracting because everyone else is growing at a much more rapid pace. We saw that there was a deal announced last week that was almost out of necessity because these brokers are all very mindful of their positioning in the market,” Friedman said.

In his view, no one will restrict acquisitions but rather the next tier of brokers looking to potentially be sold will start focusing more attention on some of the corporate strategic buyers and private equity investors that have historically acquired them.

At the same time, Friedman said he expects to see a fair amount of IPO activity, including “at least a couple” in 2026, as a “high-quality, sizable” backlog already exists and brokers are simply waiting for favorable market conditions.

“The IPO markets have been sporadic. We’ve seen a couple of IPOs, particularly in the insurance sector. But I think brokers with such high valuations are waiting for the market to really come back… I do expect to see a significant increase in uptick in IPO activity once the markets come back,” Friedman said.

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Connecticut Insurance Commissioner Andrew Mais is asking a judge to loosen the moratorium on PHL Variable policies to allow for more flexible distributions for universal life and fixed index annuity owners.

Mais, serving as the official rehabilitator for the financially troubled PHL, hinted at the possibility of adjusting the moratorium in a May 20 status report. But first, regulators wanted to analyze “the options and the impact of a moratorium modification on PHL’s liquidity and prospects for rehabilitation.”

That analysis supported allowing policyholders to access more options and benefits with their policies, Mais said in a July 1 report to the court. Mais informed the court he intends to file a motion for modification of the moratorium “before the end of July.”

Court approval of the modification is not expected to occur until the third quarter of 2025, he added.

“Until the Court has entered an order modifying the Moratorium, policyholders and annuity owners will continue to be subject to the Moratorium as currently in effect,” Mais stressed.

The troubled PHL and its subsidiaries, Concord Re and Palisado Re, were put in Mais’s control after a May 20, 2024 court order. Rehabilitators released a second “Accounting and Status Report” Tuesday.

In his May 20, 2025 status report, Mais outlined efforts to sell or reinsure PHL books of business. Thirteen companies signed non-disclosure agreements and have access to a “virtual data room” with an actuarial appraisal report, a summary of existing reinsurance arrangements, and details regarding the PHL companies’ arrangements with third-party administrative and investment providers.

Another dozen companies were in discussions with Connecticut counsel to resolve concerns about the NDA, Mais said in the report.

The commissioner, “continues to believe that a sale of some or all of PHL’s lines of business will provide the best outcome for policyholders,” Mais said in the report. “The sales process has launched, but it is still at a relatively early stage. The Rehabilitator expects to have expressions of interest from potential buyers in the third quarter of 2025.”

Modification details

PHL issued life insurance and annuity products and related supplemental contracts to policyholders nationwide. Concord and Palisado are captive insurers whose only business is the reinsurance of PHL’s liabilities.

As part of his rehabilitation effort, Mais introduced the moratorium on benefits payments until a Connecticut court approves a final plan. Several policyholders filed objections to the moratorium.

While sales talks are ongoing, Mais explained how policyholders can access more of their benefits. Universal life policyholders have two options under the moratorium modification:

• Reduction in the face amount of death benefits with downward premium adjustment prospectively.
• Convert policy to a claim for a fixed amount (to be determined based on adjusted surrender value) with no ongoing premium obligation.

The modification is expected to offer fixed indexed annuity owners who have not activated their income rider or are currently receiving systematic withdrawals two alternatives:

• Activate the income rider (to the extent available under the contract).
• Receive a one-time surrender-charge free distribution of the “Free Withdrawal Amount” under the contract (typically this is approximately 10% of the contract’s account value).

The motion will be posted on the PHL Rehabilitation Website at when it is filed, Mais said, and notice will be provided to affected policyholders as directed by the court.

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A recent Supreme Court ruling pertaining to birthright citizenship could also shut down a key strategy for financial services to block unwelcome federal rules.

The 6-3 ruling in the Trump vs. CASA case saw the SCOTUS side with the Trump administration in a case involving an executive order that seeks to eliminate birthright citizenship.

The high court was not asked to rule on the details of the executive order, but rather the constitutionality of a lower-court injunction preventing the order from being enforced.

In the ruling, written by Justice Amy Coney Barrett, the justices argued that universal injunctions “likely exceed the equitable authority that Congress has granted to federal courts.”

A universal injunction is a court order that prohibits the government from enforcing a law, regulation or policy against anyone, not just the plaintiffs in a case. It applies nationwide regardless of the issuing court’s jurisdiction.

Universal injunctions have been used to great effect by opponents of both Republican and Democratic administrations in the past. Particularly involving rules that affect insurance and financial services.

For example, on March 30, 2023, Judge Reed O’Connor of the Northern District of Texas issued an injunction blocking a requirement that non‑grandfathered health plans must cover preventive services such as HIV PrEP and various screenings.

That ruling came about four years after Judge Wendy Beetlestone of the Eastern District of Pennsylvania issued an injunction blocking enforcement of rules expanding religious/moral exemptions allowing employers to opt out of Obamacare’s contraceptive coverage mandate.

According to one source cited by the SCOTUS, 75 percent of all universal injunctions occurred during the past 25 years, noted Ashley L. Taylor, Jr., partner at the law firm Troutman Pepper Locke.

“What’s been increasingly common is for groups of states of one political persuasion to sue presidents of the other political persuasion,” Taylor added. “Although the Court does not end that practice, any injunctions would run only to those states.”

Fiduciary rule injunction

The SCOTUS ruling is not absolute. It does not apply to actions brought under the Administrative Procedure Act, a crucial carve-out that leaves in place nationwide stays issued by Texas courts delaying the Biden administration’s Retirement Security Rule.

“Nothing we say today resolves the distinct question whether the Administrative Procedure Act authorizes federal courts to vacate federal agency action,” the SCOTUS ruling states.

Several industry trade groups – the American Council of Life Insurers, the National Association of Insurance and Financial Advisors, Finseca, the Insured Retirement Institute and the National Association for Fixed Annuities – argued that the Department of Labor exceeded its authority with the RSR.

In a 2024 lawsuit that led to the nationwide stay from two Texas courts, the trade groups claim the DOL’s rule redefines “investment advice fiduciary” to include one-time rollovers and sales interactions, moving beyond Congress’s intent.

With Donald Trump’s return to office, it is expected that the RSR will eventually disappear. For now, that would pause the DOL’s lengthy attempt to bring most sales of financial products under a fiduciary umbrella.

“We are aware of the Supreme Court decision. Our counsel is reviewing the potential impact, if any, on the fiduciary rule case,” the five trade associations said in a joint statement. “It is noteworthy that the Supreme Court explicitly said its decision doesn’t address cases, like our fiduciary-only rule litigation, brought under the Administrative Procedures Act.”

More litigation?

Rather than dampen the litigious instincts of many trade groups, states and other aggrieved parties, the SCOTUS decision could increase the number of lawsuits filed, explained Zachary Busey, shareholder with the law firm Baker Donelson.

With the national injunction option going away, any group or company or person who wants the benefit of stopping an action must file their own lawsuit, he noted.

“Where one lawsuit was filed now, we’ll have 50,” Busey said. “They’ll be filed all around the country, and it will have to filter up to the Supreme Court to settle what will be undeniable lower-court splits at the end of the day.”

The SCOTUS decision means plaintiffs could shift their focus from seeking injunctive relief to filing class-action lawsuits. The Federal Rule of Civil Procedure 23, known colloquially as Rule 23, refers to a legal process for certifying a class action lawsuit in federal court. Busey said it is likely to be the next sticking point for the court.

“The Supreme Court has started to take a focus on Rule 23 and exactly what or who can be part of a class and whether individuals without damage can be included in the class,” Busey said. “I think this decision will accelerate the court’s substantive review of Rule 23 at some point here in the near future.”

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Digital customer service platform Glia recently launched an AI benchmarking tool it hopes will help insurers “cut through the fog” in analyzing their artificial intelligence strategy.

“There is an enormous fog of war at the moment. We are squarely in the middle of the hype cycle. Everybody’s throwing AI onto their products like a sort of bumper sticker. Our customers are like a deer in a headlights; it is very difficult to know what’s working and what’s real and what’s not,” Jake Tyler, AI strategy director, Glia, said.

Cortex AI Benchmarks is a reporting dashboard created by Glia. The AI benchmarking allows companies to assess the actual impact of their AI rollout and compare that performance with leading companies across the sector — either “patting themselves on the back” for their AI rollout or rethinking what’s not working.

“We can share the results of how other customers, how people’s peers, are using our AI products and provide some very relevant benchmarks on that performance for customers who are either evaluating if they should introduce AI tools, or have already introduced these tools and are looking to evaluate how they’re using them,” Tyler said.

He noted that many companies are already using the same or similar AI benchmarking tools, but the differentiating factor comes down to how that technology is being adopted.

“The difference between your results and someone who’s in our top quartile is really about how you’ve deployed it and how you’re using it. That was the point of our AI benchmarks. It’s really meant to cut through the hype and fog of war in AI and let people see the data for themselves,” Tyler said.

AI benchmarking: Key metrics

Glia’s benchmarks look at KPIs that are “easy to understand and easy to measure,” such as automation rates and time saved. For example, the results from an AI feature called “autocomplete” that types ahead to suggest the next word or the rest of the sentence an agent is typing.

“This is a super helpful tool as people are interacting via chat specifically. So, what we can do with autocomplete is tell people how much time they’re saving per every hundred interactions. That’s a very sort of standard benchmark,” Tyler said.

He noted that a lot of financial companies that rank in the top quartile save almost twice as much time as the average benchmark using this autocomplete feature.

“Many customers have deployed the feature, have activated it, but their service reps just aren’t using it very much. So, we do see lots of folks are below that average and looking to come up,” he said.

Similarly, another Glia tool called “interaction wrap up” helps automate post-call work. Tyler said this is another area where results vary significantly between those who use it and those who don’t — and the value realized accordingly.

“We have some key benchmarks for that feature as well. What’s the automation rate? How much of that post-call work are we able to automate? What’s the time saved for every interaction? And then again, we can share the benchmark for average and top quartile,” he said.

Capturing efficiency

Tyler acknowledged that many stakeholders are eager to measure the efficiency of AI. However, as this is a “difficult” metric to measure, he instead suggested companies analyze indicators like whether AI has helped multiply their team’s capacity.

“We talk about efficiency with AI a lot, and I think the efficiency part is a little bit challenging to actually capture in the real world. I think AI and tools like this are more of a force multiplier. So, you can do more with your existing team,” Tyler explained.

To illustrate his point, he said if a given company has a 10-minute handle time but AI automation is able to save one to two minutes, that equates to a 10% to 20% force multiplier from a feature that is very simple to use and integrate.

“Regardless of the insurance company, their size, their line of business — everybody’s feeling that pain of wanting to be more efficient. This tool really helps them solve that, and the beauty of benchmarks is that they can see that data for themselves,” Ryan Baillargeon, insurance industry lead, Glia, noted.

Insight and analysis

Glia believes this tool can benefit anyone evaluating an AI product or solution, and especially for those in financial services, which is their specialty. Additionally, they offer clients support with improving benchmarks by providing suggestions and sharing best practices from top quartile clients.

“The tool is a way for you to see that these features can deliver value and are delivering value for people like you. It can help you to build the business case; we certainly have other ways to help folks do that as well,” Tyler said.

Glia is a digital customer service platform that helps insurance companies improve customer interactions. Founded in 2012 with headquarters in New York City, Glia has partnered with over 500 financial institutions across 47 states and 12 countries.

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