Property & Casualty News April 2011

First Consulting is pleased to provide this brief review of selected items that may be of current interest to clients and friends.  Please feel free to copy it for distribution to your staff.  Contact us for more details about any item.  We welcome your comments and suggestions on this letter.  To contact us call 800-927-2730 or email us at Inquiry@firstconsulting.com.

APPLICATIONS
South Dakota amended its Code regarding statements made in insurance applications.     Senate Bill 44


AUTOMOBILE INSURANCE

California adopted and amended regulations concerning‘‘good driver’’ insurance policy discounts.     Cal. Code Regs., tit. 10, sections 2632.13 and 2632.13.1.

Michigan issued a bulletin to make insurers and consumers aware of the availability of “pay as you drive” or mileage based insurance rates.     Bulletin No. 2011-10-INS

Montana revised its motor vehicle law 61-3-205 pertaining to transfer of ownership of vehicles by insurance companies with electronic signatures.     House Bill No. 399

Montana revised its motor vehicle law 61-3-211 pertaining to salvage certificates to require that an insurer surrender to the DMV the certificate of title to a salvage vehicle that is less than 15 years of age, rather than less than 5 years of age.     Senate Bill No. 211

Montana revised its motor vehicle law to delay implementation of the motor vehicle liability insurance verification program to 1-1-2013.     House Bill No. 367
 
South Dakota issued a bulletin announcing the repeal of requirements that insurers provide discounts to certain insureds age 55 and over who have completed accident prevention courses.  The bulletin notes that because such discounts are included in an insurers’ rating rules, it will be necessary to amend the rating rules in order to discontinue providing the discount to qualified insureds.  Also, if the discounts were included in a policy or endorsement, any amendments to those forms would need to be filed and approved.     Bulletin 2011-3



CAPTIVE INSURANCE COMPANIES

Kentucky issued a bulletin to clarify the expectations for Risk Retention Group Captives with respect to compliance with the NAIC's new accreditation requirements.     Bulletin 2011-2

Montana made several changes to its Code pertaining to captive insurance companies.     House Bill No. 419

West Virginia approved changes to its Code pertaining to captive insurance companies.  Included in the changes is a provision subjecting any captive insurance company organized as a risk retention group to certain insurance code provisions.     Senate Bill No. 356


CERTIFICATES OF INSURANCE

Massachusetts issued a bulletin to clarify the proper use of Certificates of Insurance.     Bulletin B-2011-7

Utah enacted legislation to address issues related to certificates of insurance.     House Bill 79


COMMERCIAL LIABILITY INSURANCE

Arkansas enacted legislation providing requirements concerning the definition of “occurrence” that must appear in commercial liability insurance policies and providing a requirement that commercial liability policies not be sold unless the DOI has approved the commercial liability policy or endorsement that complies with this section.     House Bill 1439


CREDIT SCORING

Connecticut issued a bulletin describing requirements for the written disclosure an insurer must provide pertaining to consumer protections when the insurer uses credit information in underwriting and pricing.     Property/Casualty Bulletin PC-69

Rhode Island enacted legislation to provide guidelines for insurers using credit history in underwriting and rating  homeowners and/or private passenger automobile insurance when an insured or applicant experiences an extraordinary life event or has insufficient credit history.     R27-116-001 through R27-116-009


HOMEOWNERS' INSURANCE

New Jersey adopted new rules pertaining to homeowners' insurance hurricane deductibles, the process for making homeowners' insurance rate changes and related reporting requirements.     NJAC 11:2-42.9 and -42.10, NJAC 11:2-42 Exhibit E


LARGE COMMERCIAL RISKS

Virginia amended its Code pertaining to large commercial risks.  Provisions relating to professional liability policies and reporting of exempted policyholders were deleted.     House Bill 1586


MEDICAL MALPRACTICE INSURANCE

New Jersey adopted new regulations pertaining to filings for medical malpractice liability rate changes.     NJAC 11:27-14.1 +


MISCELLANEOUS

Arkansas approved legislation to establish the Arkansas Arbitration Act by amending the previous Act in its entirety.     House Bill 1438

Florida issued a memorandum to notify all Assessable Insurers and Surplus Lines Insurers that Citizens Property Insurance Corporation reduced the Emergency Assessment for the 2005 Plan Year within the High Risk Account from 1.4% to 1.0% effective July 1, 2011.     Informational Memorandum OIR-11-03M

Florida issued a memorandum to inform property and casualty insurers of Partners in Recovery.  This not-for-profit organization provides year-round insurance disaster preparation and response  communications among the Department of Financial Services (DFS), the Office of Insurance Regulation (OIR), and emergency management and insurance communities.     Informational Memorandum OIR-11-02M

Kansas revoked regulation 40-3-33 pertaining to fire and casualty insurance, the FAIR Plan and the all-industry placement facility.     40-3-33

New Jersey enacted the Reinsurance and Surplus Lines Stimulus and Enhancement Act to provide incentives for surplus lines insurers and reinsurers to do business in the state.     Assembly Bill 2670

Oklahoma issued a bulletin regarding coverage including defense expenses within the limits of liability of certain insurance policies.     Bulletin PC 2011-01

Virginia enacted legislation relating to portable electronics insurance.     House Bill 2480

West Virginia enacted legislation relating to an exemption from insurance licensing requirements for vendors of portable electronics when offering portable electronics insurance.     Senate Bill No. 472


OMNIBUS LEGISLATION

Arkansas enacted the state insurance department's general omnibus bill.  Changes are made to many provisions.     House Bill 1806


PERSONAL LINES INSURANCE

Arkansas amended its Code concerning liability insurance requirements for watercraft to require an out-of-state motorboat or personal watercraft to have liability insurance in Arkansas.     Senate Bill 560

Texas issued a bulletin requesting rate information for the Helpinsure.com website.  Property and casualty insurers who are currently writing new personal auto and/or residential property business and meet certain criteria explained in the bulletin will be required to submit information.  All other P&C insurers have the option to report the requested information, and TDI strongly encourages participation.     Commissioner's Bulletin B-0016-11


PREMIUM TAX

Kentucky issued a bulletin regarding the 2011-2012 local government premium tax schedule.  The bulletin explains policyholder disclosure requirements and contains information regarding changes to the annual reconciliation filing requirements, legislative changes that impact local government premium tax laws and changes to various tax rates.     Bulletin 2011-1


PRODUCERS

Arkansas issued a bulletin notifying insurers of the requirements and procedures for producer appointments,  renewals, terminations and payment of fees. This Bulletin  rescinds prior Bulletin 2-2010.     Bulletin 2-2011

New Jersey issued a bulletin to clarify producer appointment procedures.     Bulletin 11-06

Utah revised its Code regarding errors and omission coverage of certain insurance producers.     House Bill 43


READABILITY

Wisconsin adopted an emergency rule related to insurance policy language simplification.     Ins 6.07


REPORTING REQUIREMENTS

New Mexico issued a bulletin to clarify and expand upon the Catastrophe Declaration issued on February 8, 2011.  The bulletin explains reporting requirements associated with this Catastrophe Declaration.     Supplemental Insurance Division Bulletin No. 2011-002


STOP LOSS

Arkansas enacted the state insurance department's general omnibus bill, which includes changes to employee benefit stop-loss provisions.     House Bill 1806


SURPLUS LINES

Kentucky enacted a new law pertaining to the Surplus Lines Insurance Multi-State Compliance Compact.     House Bill 167

Mississippi made several changes to its Code pertaining to surplus lines insurance.   Included in the changes are a provision permitting the Commissioner of Insurance to enter into a compact to allocate among states the premium taxes paid to an insured's home state according to the Nonadmitted and Reinsurance Reform Act of 2010 and provisions regarding the eligibility of nonadmitted insurers to write business in the state.     House Bill No. 785

Ohio enacted a new law and amended existing laws concerning surplus lines insurance.     Amended Substitute House Bill Number 122

Virginia amended, reenacted and added  sections to its Code relating to surplus lines insurance, licensing of surplus lines brokers and premium tax liability.     House Bill No. 2286


TITLE INSURANCE

Arkansas amended its Code concerning title insurance to regulate the issuance of closing protection letters.     Senate Bill 309

Idaho amended existing law relating to title insurance to revise and to provide additional provisions pertaining to the filing of escrow fees of title insurers and title insurance agents, and to remove provisions relating to the filing of certain fees by a title insurer or agent.     Senate Bill 1087


WORKERS' COMPENSATION

Montana enacted legislation revising workers' compensation law pertaining to settlements and lump-sum payments.     House Bill No. 359

North Dakota enacted legislation to increase the maximum dollar amount that may be paid for real estate modifications for an injured employee.     House Bill No. 1453

Pennsylvania issued a notice stating that insurers will not be required to submit contributions to the Workers' Compensation Security Fund in 2011.     Notice 2011-2

Texas announced that the following manuals have been updated on the TDI website:  The Texas Basic Manual of Rules, Classifications and Experience Rating Plan for Workers’ Compensation and Employers’ Liability Insurance (the Manual) The Texas Workers’ Compensation Retrospective Rating Plan Manual (Retro Manual)  The Workers’ Compensation Rate Guide     TDI eNews Update of 4-5-2011

West Virginia enacted legislation regarding workers' compensation insurance premium payments made by volunteer fire departments.     House Bill 3271


 Complimentary Research Services -
Updates for Week of 4-18-2011


First Consulting & Administration, Inc. recently announced the addition of the following complimentary research charts to our existing On-Line Research Services:

     Signature Page Requirements - Commercial Lines Property & Casualty
     Signature Page Requirements - Personal Lines Property & Casualty

The information on the charts was provided by state insurance departments in response to questions asked by First Consulting.  We added Delaware, Idaho and New York responses just this week.  We will continue to add additional information to these charts when it becomes available. 

For more information click here or contact John Palmer, Sheila Lawrence or any First Consulting associate.



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