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Insurance regulator defends Salesforce-based tracking system as costs rise; hearings probe Maryland Auto affordability options
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Summary
The Maryland Insurance Administration told the subcommittee an insurance-tracking system replacement using Salesforce will cost an estimated $29.8M through FY27 (outer bounds to ~$33.8M through FY28), up from earlier $18.1M estimates; the agency pledged not to seek FY26 or FY27 budget amendments and said it will provide updated reporting, while members pushed for detail on audit repeat findings and solutions for Maryland Auto.
Department of Legislative Services summarized the Maryland Insurance Administration budget and a major IT initiative to replace the insurance tracking system, prompting extensive questioning about cost growth and program performance.
DLS analyst Kelly Norton reported the MIA FY27 operating allowance is $59.3 million (a 3.2% increase). Norton highlighted the insurance tracking system project (MITDP), noting earlier estimates of $18.1 million have grown and that DLS now expects project costs to be in a $30–$40 million outer bound without more precise closeout estimates. DLS recommended committee narrative asking MIA for updated reporting on actual and estimated project costs.
Maryland Insurance Commissioner Marie Grant told the committee MIA moved the project to a DoIT master contract implementation using Salesforce after a former vendor defaulted. Grant said the agency has finalized data-migration design, contracted a document-management vendor to address Salesforce document-capability gaps, and reorganized scope (descoping certain areas such as hearings). Grant provided an estimated total of $29.8 million through FY27 and a projected final budget of about $33.8 million if FY28 closeout projections are included, while characterizing the $30–$40M figure as an outer bound.
Commissioner Grant said the agency has strengthened staffing and oversight (new IT director, contractual project manager, Salesforce developer and other hires), committed to monthly reports with DoIT, and publicly promised no FY26 or FY27 budget amendments for the project. "I can promise," Grant said when asked about additional budget amendments.
Members questioned the MIA about repeat audit findings and whether the new system will resolve them; Grant said some audit findings (for example premium-tax collection processes) depend on financial/accounting systems and may not be fully solved by Salesforce alone but that many process improvements and staffing increases should help reduce repeat issues. Committee members also probed the work group on automobile affordability and policy options for Maryland Auto, the state's high-risk auto insurer. MIA staff described alternatives used by other states (assigned risk pools, low-cost "skinny" products and other mechanisms) and said further study and legislative decisions would be needed to change Maryland's structure.
The subcommittee asked MIA for a detailed breakdown of the cost drivers moving the project toward the outer-bound estimates, as well as follow-ups on audit remediation status and fraud/complaint metrics; the administration agreed to provide written detail and ongoing reporting.
