Property & Casualty News January 2011

The following is a brief review of selected items that may be of current interest to First Consulting & Administration, Inc. 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.  Please call our office.


AUTOMOBILE INSURANCE
New York issued a Circular Letter regarding no-fault coverage changes.     Circular Letter 2011-4


CERTIFICATES OF INSURANCE
Louisiana has adopted new regulations pertaining to the use of Certificates of Insurance.   Among the changes, LAC 37:XIII.13913 includes a requirement that certificate of insurance forms be approved by the commissioner and provides that the LDI number assigned to the certificate and approval date shall be placed on the certificate of insurance, and that the certificate must then be resubmitted for placement on the LDI certificate of insurance website.   LAC 37:XIII.13915 provides a procedure for resubmission of certificates of insurance approved prior to 1-1-2011.     LAC 37:XIII.13901 - LAC 37:XIII.13925


FILING REQUIREMENT - AUTOMOBILE INSURANCE
Pennsylvania issued a Notice regarding an increase in the accident surcharge dollar threshold (cap) to $1,450 effective 7/1/2011.  The Notice states that individual insurers (as well as ISO, AIPSO and MSO) should file this change for prior approval by 4/1/2011 with an effective date of no later than 7/1/2011.  To expedite the review process, companies are advised to limit their rate/rule filings to the required threshold revision only.     Notice 2011-1


FRAUD
Louisiana issued an Advisory Letter to announce that all authorized insurers are required to file an initial anti-fraud plan between 1/1/2011 and 4/1/2011.  If an insurer has already filed its anti-fraud plan in Louisiana prior to 1/1/2011, the insurer is required to re-file in the format described in the Advisory Letter.  The letter also describes annual reports that will be required in future years.     Advisory Letter No. 2010-02


MEDICAL MALPRACTICE INSURANCE
New Hampshire issued a Bulletin to announce that the Commissioner has determined that a competitive market for medical malpractice insurance covering physicians, surgeons and hospitals does not exist in New Hampshire and that rate filing procedures and standards specific to a noncompetitive market continue to apply.     Bulletin 12-9-2010


MISCELLANEOUS
California issued a bulletin regarding the transaction of insurance in other States and Territories.   The bulletin lists the 28 states and territories that are recognized as 'reciprocal States' and asks that the DOIs of the reciprocal states inform California of violations by California insurers that occur in their jurisdictions.     Bulletin 2010-3


Georgia issued a directive informing domestic insurers that all annual insurance company renewal fees must be paid electronically.     Directive 10-EX-3


Maryland issued a Bulletin to remind insurers that all claims made policies must include the option of purchasing an unlimited extended reporting period subject to the underwriting standards of the company.   The bulletin notes that in addition to the unlimited extended reporting period, an insurer may offer its insureds the option of purchasing an extended reporting period for a lesser amount of time.  The bulletin also discusses filing requirements associated with offers of less than an unlimited extended reporting period.     Bulletin 10-36 - Amended

New York issued an OGC opinion discussing requirements for an insurer writing in the Free Trade Zone to provide an insured with notice of conditional renewal prior to amending a policy.     OGC Opinion No. 10-11-06

Oregon adopted rules that require certain property and casualty insurers or their appointed producers of record to provide loss runs on a timely basis to current and prior commercial policyholders, upon the request of the policyholder.     OAR 836-080-0800, 836-080-0805 and 836-080-0810

The District of Columbia issued a bulletin providing guidance for insurers regarding the implementation of the Religious Freedom and Civil Marriage Equality Amendment Act of 2009.     Bulletin 10-IB-02-12/17


PERSONAL LINES INSURANCE
Missouri issued a bulletin regarding the use of personal lines premium stabilization within rating plans to moderate the transition between renewals for existing customers.   The bulletin provides operating guidelines for insurers implementing premium stabilization plans.     Bulletin 2011-02

Rhode Island has enacted new legislation regarding the use of insurance scores in underwriting and rating homeowners or private passenger automobile insurance when a consumer experiences an extraordinary life event.  Insurers are required to bring their existing filings into compliance with the new regulations, and any revised filings must be submitted to the DOI by 4-1-2011.      R27-116-001 through R27-116-008


PREMIUM TAX
The Texas Insurance Commissioner issued an Order setting the rates for maintenance taxes and fees assessed on  gross premiums for calendar year 2010.     Commissioner's Order No. 10-1069


PRODUCERS
California approved new and amended regulations regarding the Standards and Training for Estimating Replacement Value on Homeowners' Insurance.  Effective June 27, 2011, every California resident fire and casualty broker-agent and personal lines broker-agent who has not already taken a homeowners' insurance valuation training course must complete one three-hour training course on homeowners' insurance valuation meeting the requirements specified in the regulations.     Regulation File REG-2010-00001

Michigan issued a Bulletin to emphasize the responsibilities of resident and non-resident insurance producers to safeguard customers’ nonpublic personal information.      Bulletin 2010-21-INS

North Carolina issued a Memorandum regarding the requirement that licensees maintain current email addresses with the North Carolina Department of Insurance.  The bulletin notes that the requirement was effective 1-1-2010; however, there are still several thousand licensees without an email address.  The bulletin also notes that the Department plans to impose an administrative fee of $50 for failure to provide an email address in 2011.     Memorandum 1-3-2011

Ohio amended its regulations concerning agent licensing and continuing education.     Rule 3901-5-01 +

Oregon adopted and amended its rules regarding the process for applying for an insurance producer license.  The applicant must now complete all other steps in the licensing process before submitting the application to the Insurance Division.  The rules also amend the fee schedule for examinations.     Adopted OAR 836-071-0118; Amended OAR 836-009-0007, 836-071-0110 and 836-071-0120


REPORTING REQUIREMENT
New Jersey issued a bulletin to advise insurers that they are not required to file Homeowners Comparison Survey data for the year 2010.  The rule requiring that this data be submitted annually is expected to be repealed in the near future.     Bulletin No. 10-38

New Jersey issued a bulletin to clarify the annual premium survey requirements applicable to private passenger automobile insurance.     Bulletin No. 10-37

Puerto Rico issued a Circular Letter asking that all domestic insurers, licensed to transact property, maritime and transportation risk, agricultural, motor vehicle, accident, warranty and title insurance provide the Commissioner with a detailed list of their use of reinsurance, in terms of ceded premiums and recovered losses.  The circular letter includes a form to be used in providing the required information.     Circular Letter AF-1813-2010

Puerto Rico issued a Ruling Letter to advise all property and casualty insurers authorized to do business in Puerto Rico that they must provide information regarding compensation of general agents by 2/26/2011.  The Ruling Letter describes how the information is to be submitted.     Ruling Letter No. 2010-119-AP


SURPLUS LINES
New Jersey issued an order regarding changes to the surplus lines exportable list.     Order A10-121


TITLE INSURANCE
Utah issued a Bulletin clarifying the intent and application of rules pertaining to title industry self-promotional novelty items given to customers and members of the general public.     Bulletin 2010-10

 


Does your Company have compliance questions?  
Do you want to survey the state insurance departments? 

Insurance products are subject to complex, ever-changing laws and regulations.  Keeping up with these requirements is time-consuming. 

 

First Consulting & Administration, Inc. can help.

First Consulting can assist you by researching and compiling laws and regulations on topics of concern to your Company.  We also conduct surveys without revealing your Company’s identity.  We have assisted our clients with their product form, rate and rule filings, regulatory research, and other compliance related tasks since 1969.

Call John Palmer, Sheila Lawrence, or any First Consulting associate for more information. Visit our website at www.firstconsulting.com.