Financial Services, Banking, Insurance
Financial services legislation focused on consumer protection, privacy, regulatory modernization, and emerging financial products. Banks and insurers were especially engaged on data privacy, data broker regulation, coerced debt protections, workers’ compensation, merchant cash advances, and insurance coverage mandates, with several broader insurance proposals left unresolved.
H.385 – Coerced Debt
This bill creates protections and legal remedies for victims of coerced debt, including survivors of domestic violence, human trafficking, and abuse of vulnerable adults. Victims may challenge debts incurred through coercion, seek removal of related negative credit information, and access additional protections in debt collection and court proceedings. The coerced debt provisions take effect July 1, 2028.
The bill also authorizes financial institutions to temporarily delay transactions and take other protective actions when they reasonably suspect a customer is being financially exploited.
Institutions acting in good faith under the law receive liability protections, and the Department of Financial Regulation is required to collect data and report on implementation of both provisions. Governor Scott signed the bill on May 20, 2026.
S.71 – Consumer Data Privacy Act
While discussed in greater detail elsewhere in this report, S.71 was closely monitored by banks and insurers because lawmakers ultimately preserved important exemptions for entities and information regulated under the federal Gramm-Leach-Bliley Act (GLBA). As a result, most customer information collected and maintained as part of traditional banking and insurance activities remains outside the scope of the new law, avoiding duplicative privacy and compliance requirements.
H.211 – Data Broker Regulation
H.211 was also closely watched by banks, insurers, and other financial-service providers due to concerns that the bill could inadvertently capture activities related to underwriting, lending, fraud prevention, claims administration, and risk assessment. The final legislation retained exemptions for GLBA-regulated entities and information, helping ensure that financial institutions already subject to comprehensive privacy and security requirements would not face overlapping regulation.
H.648 – Banking, Insurance, and Securities – DFR Housekeeping Bill
H.648 makes a series of technical updates to Vermont financial services laws. The bill updates financial privacy requirements governing the disclosure of customer information, strengthens restrictions on misleading loan and mortgage solicitations, revises lending discrimination and adverse-action notice requirements, and updates reverse mortgage and mortgage escrow account provisions. The legislation also requires submission of certain Community Reinvestment Act reports to DFR, prohibits certain returned-check fees, eliminates cryptocurrency ATMs in Vermont, and establishes a regulatory framework for merchant cash advances, factoring transactions, and other forms of commercial financing.
S.173 (Act 107) – Workers’ Compensation and Vocational Rehabilitation
S.173 addresses workers’ compensation vocational rehabilitation programs and related administrative processes. The bill seeks to improve return-to-work outcomes for injured employees while updating aspects of the vocational rehabilitation system. Workers’ compensation carriers and employers closely monitored the legislation due to its potential impact on claim administration and program costs.
Several Insurance-related Proposals That Did Not Pass
The Legislature also considered several insurance-related proposals that did not pass, including S.7 (underinsured motorist coverage reform), H.525 (mandatory no-deductible auto glass coverage), and H.526 (insurance discounts for drivers completing approved driver safety courses). These can all be reviewed under Other Significant Legislative Actions.
