Guides
Life insurance laws and regulations that changed in 2026
Dated list of enacted or adopted 2026 changes for life insurance buyers: estate tax, DOL fiduciary rule, IUL illustrations, lapse notices and AI laws.
This list covers only changes that have been enacted, adopted or made final, each with a date and a source. It leaves out pending bills and proposals, because a bill is not a law until it is signed. The ones most likely to touch a life insurance buyer in 2026: a permanent $15 million federal estate tax exclusion, the end of the DOL's 2024 fiduciary rule, tighter NAIC illustration rules for indexed universal life policies sold on or after April 1, 2026, and a Washington law requiring third-party lapse notices from 2027.
Status as of October 4, 2026. This is a selective list, not a complete catalog of every state's changes, and it is not legal advice.
At a glance
| Change | Level | Adopted | Effective | What it does |
|---|---|---|---|---|
| Federal estate tax exclusion | Federal (Public Law 119-21) | Signed July 4, 2025 | 2026 | $15,000,000 per person, indexed to inflation |
| DOL 2024 fiduciary rule removed | Federal (DOL) | Federal Register notice March 20, 2026 | April 20, 2026 | 1975 five-part test restored |
| AG 49-A amendment (IUL illustrations) | NAIC guideline | Nov. 13 and 21, 2025 | Policies sold on or after April 1, 2026 | Alternate scale shown alongside the illustrated scale |
| Washington HB 2428 | State | Signed March 16, 2026 (Chapter 62, 2026 Laws) | January 1, 2027 | Lapse notice to policyholder and designated third party |
| Colorado SB 26-189 | State | Signed May 14, 2026 | Core duties January 1, 2027 | Replaces the 2024 Colorado AI Act with a narrower notice framework |
| Colorado Regulation 10-1-1 amendment | State regulation | 2025 | Compliance by July 1, 2026 | Extends AI and data governance rules beyond life insurers |
| NAIC 2027 Valuation Manual amendments | NAIC | Aug. 2026 | 2027 | Insurer reserving rules |
Federal changes
Estate tax exclusion (Public Law 119-21)
According to the IRS, the basic exclusion amount for estates of people dying in 2026 is $15,000,000 per person, up from $13,990,000 in 2025, under the 2025 tax law known as the One Big Beautiful Bill Act (Public Law 119-21, signed July 4, 2025), and it is indexed for inflation with no scheduled sunset. The 2026 annual gift tax exclusion is $19,000. See the IRS's What's new for estate and gift tax page. This means most families owe no federal estate tax, and an ILIT is a smaller concern than it was when the exclusion was scheduled to fall; see life insurance and the federal estate tax. State estate taxes can still apply at much lower thresholds (state estate and inheritance taxes and life insurance).
DOL fiduciary rule removed
The 2024 Retirement Security Rule never took effect. After the Fifth Circuit dismissed the DOL's appeal on November 28, 2025, the DOL published a Federal Register notice on March 20, 2026, effective April 20, 2026, that removed it from the Code of Federal Regulations and restored the 1975 test. Details and what it means for annuity rollovers are in The DOL fiduciary rule and annuity sales: where it stands in 2026.
NAIC changes
Indexed universal life illustrations (AG 49-A)
The NAIC's Life Actuarial Task Force adopted an amendment to Actuarial Guideline 49-A on November 13, 2025, and the Life Insurance and Annuities (A) Committee adopted it on November 21, 2025. According to NAIC committee records, the amendment addresses illustrations that cite historical averages above the maximum illustrated rate and backcasted performance. For policies sold on or after April 1, 2026, the illustration must show a ledger using an alternate scale next to the ledger using the illustrated scale with equal prominence, and a table for the benchmark index account showing the minimum and maximum geometric average annual credited rates. Carriers may apply it from January 1, 2026. An actuarial guideline is applied by states through their insurance departments, so check how your state treats it. For what to look for in an illustration, see IUL illustrations and Actuarial Guideline 49 and Indexed universal life (IUL) explained.
Valuation Manual
The NAIC Life Actuarial Task Force adopted the 2027 Valuation Manual amendments, and the NAIC reports Executive Committee and Plenary adoption on August 14, 2026. This governs how insurers calculate reserves rather than anything on your policy.
Where the NAIC has started, not finished
At its August 12, 2026 meeting the Life Insurance and Annuities (A) Committee reported that a Task Force had approved a request to develop revisions to the Annuity Disclosure Model Regulation (#245). A request to start drafting is not an adopted model, and no state has law from it; this is noted only so readers do not confuse it with enacted changes.
State changes
Washington lapse notice law (HB 2428)
Substitute House Bill 2428, "Preventing unintentional lapses and cancellations of life insurance policies," passed the House 94-0 and the Senate 48-0, and was signed on March 16, 2026 (Chapter 62, 2026 Laws), per the Washington Legislature. Per trade press (Insurance Business), it takes effect January 1, 2027 and applies to individual life policies issued on or after that date. Insurers must send written notice at least 30 days before a policy lapses for nonpayment to both the policyholder and a third party the owner designates, and must be able to prove the notice was sent. Applicants must be told of the right to name a designee. Exceptions reported include group policies, policies with monthly or more frequent premium payments, and term policies of one year or less. Other states have similar protections; California's designee rule is in life insurance grace periods and lapses.
Colorado AI laws
Colorado's governor signed Senate Bill 26-189 on May 14, 2026. It repealed and replaced the 2024 Colorado AI Act with a framework centered on notice and explanation for automated decision-making technology, with core duties starting January 1, 2027 (bill page). Separately, the Division of Insurance's amended Regulation 10-1-1 required compliance by July 1, 2026, according to law-firm summaries. See AI regulation in insurance: Colorado, the NAIC bulletin and New York.
Washington estate tax
According to the state revenue department, Washington's estate tax exclusion is $3,000,000 for deaths from July 1, 2026 (it was $3,076,000 for deaths in January to June 2026). See Washington.
What to do with this list
- Check the effective date and policy issue date. Several changes apply only to policies sold after a set date, not to coverage you already own.
- Look up your state. State changes vary; the insurance department's website lists new rules and bulletins (state insurance departments: what they do for you).
- Use the new protections. If you buy in Washington after January 1, 2027, name a lapse-notice designee. If you are shown an IUL illustration, ask for the alternate scale ledger.
- Do not rely on proposals. Treat anything described as "proposed," "introduced" or "under study" as not yet law.
Key takeaways
- The 2026 federal estate tax exclusion is $15,000,000 per person under Public Law 119-21, and the DOL's 2024 fiduciary rule was removed from the CFR effective April 20, 2026.
- NAIC's AG 49-A amendment changes IUL illustrations for policies sold on or after April 1, 2026.
- Washington's HB 2428 (signed March 16, 2026) requires third-party lapse notices on policies issued from January 1, 2027.
- Colorado replaced its AI Act with SB 26-189 on May 14, 2026; insurers face separate Division of Insurance rules.