Property & Casualty News May 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.


ASSESSMENTS
Oklahoma issued a bulletin regarding the Oklahoma Market Assistance Program.  The Code allows the program to collect an assessment from all insurers authorized to write property and casualty insurance in Oklahoma.   The bulletin states that the amount of the assessment is $100, and all member insurers will receive an invoice.  The assessment is due on September 1, 2011.     Bulletin PC 2011-02


AUTOMOBILE INSURANCE

Arizona enacted new insurance law regarding auto glass repair and a third party administrator's role in recommending or providing information about a glass repair facility to a customer.     Senate Bill 1238

Arkansas enacted a new law to authorize the agent of an insurance company to move a total-loss vehicle from a storage facility.     House Bill 1559

Hawaii enacted legislation regarding the replacement of a motor vehicle insurance policy through an insurer's affiliate or subsidiary.     Senate Bill No. 124

Maryland enacted legislation establishing that a conviction for driving while impaired by alcohol is included among the standards that may be applied by a private passenger motor vehicle insurer for purposes of canceling or refusing to underwrite or renew a particular insurance risk or class of risk.     Senate Bill 885

Montana approved changes to its Code regarding special risk classifications for private passenger or commercial automobile policies.     Senate Bill No. 352
 
Montana approved several changes to its laws pertaining to the use of golf carts on public streets or highways.     House Bill No. 277

New Mexico amended a regulation concerning public liability insurance for motor carriers by changing the required public liability insurance policy limits based on vehicle seating capacities.     18.3.3.10 NMAC

New York amended regulations pertaining to the Comprehensive Motor Vehicle Insurance Reparations Act making permanent the text of emergency regulations that were effective March 21, 2011.     Title 11, § § 65-1.1, 65-1.3, 65-1.4, 65-2.3

North Dakota amended and reenacted section 26.1–40–17 of the North Dakota Century Code, relating to establishment of primary and excess automobile liability coverages for rental vehicles.     House Bill 1308

South Carolina enacted legislation to amend its Code concerning certain reductions in premium charges for private passenger automobile insurance and credit for driver training courses.     House Bill No. 3332

South Carolina enacted legislation to amend its Code concerning the exemption of an automobile insurer from the requirement to write automobile insurance coverage for an applicant or existing policyholder.      House Bill No. 3373

South Dakota enacted a new law to clarify the definition of motor vehicle for the purpose of supplemental automobile liability insurance.     House Bill 1058

Utah modified its Code to clarify that if the driver license of a person excluded from coverage has been denied, suspended, revoked, or disqualified and the person excluded from coverage subsequently operates a motor vehicle, the exclusion shall proportionately reduce any benefits to any named insured for benefits payable under uninsured motorist coverage, underinsured motorist coverage, personal injury protection coverage, and first party medical coverage to the extent the person excluded from coverage was comparatively at fault.     Senate Bill 99
 
Utah modified its Insurance Code by amending provisions relating to arbitration for motor vehicle insurance coverage.  The bill clarifies that certain caps on the amount of an arbitration award and the award of fees and costs apply only in certain circumstances.     Senate Bill 174

Washington enacted new legislation pertaining to for-hire vehicles and for-hire vehicle operators.     Substitute House Bill No. 1367

West Virginia adopted amendments to rules related to the standards for approval of motor vehicle accident prevention courses and which refer to eligibility for an insurance premium discount for course completion.     91-19-4 and 91-19-5

Wisconsin amended, created and repealed statutes relating to automobile insurance coverage limits, permissible policy provisions, and proof of financial responsibility.     2011 Wisconsin Act 14, 2011 Assembly Bill 4

 


CANCELLATION, NON-RENEWAL, PREMIUM OR COVERAGE CHANGES

Arizona amended certain notice requirements applicable to Commercial Insurance.     Senate Bill 1567

Colorado issued a bulletin to provide guidance to insurers issuing cancellation, non-renewal, increase in premium, or reduction in coverage notices.   This bulletin is intended for all regulated insurance entities marketing private passenger automobile insurance policies.     Bulletin No. B-5.29

Maryland enacted legislation authorizing the delivery of specified notices to an insured or policyholder by certain electronic means.     Senate Bill No. 571

 


CERTIFICATES OF INSURANCE

Georgia enacted legislation to require that certificate of insurance forms be approved by the commissioner and addressing the proper use of such certificates.     House Bill 66

Kentucky issued an Advisory Opinion regarding the proper use of certificates of insurance and to remind insurers and insurance producers of the certificate/form approval requirements in the Kentucky Insurance Code.     Advisory Opinion 2011-02

North Dakota enacted new legislation relating to property and casualty certificates of insurance.   A new chapter addresses filing requirements, notice requirements and limitations pertaining to the issuance and use of such certificates.     Senate Bill 2062

Utah modifies its Code to address issues related to certificates of insurance including form filing, required language and appropriate use of certificates of insurance.     House Bill 79

Virginia issued an Administrative Letter regarding the proper use of certificates of insurance.  The letter is directed to "All Insurers Licensed To Write Property and Casualty Insurance In Virginia" and states that "Each insurer receiving this Administrative Letter is instructed to provide a copy to each of its currently appointed agents and to each newly appointed agent".     Administrative Letter 2011-2


CONDOMINIUM OWNERS INSURANCE

Maryland enacted legislation concerning condominium insurance and references to such insurance in condominium association bylaws.     House Bill 679


DISASTER AND EMERGENCY OPERATIONS

Alabama issued a bulletin advising that a state of emergency has been declared and directing all insurers to extend a grace period to affected insureds.     Bulletin 2011-01

Arkansas issued a 60-day moratorium on the cancellation and non-renewal of policies for the non-payment of premiums for policyholders residing in areas impacted by the storms of April 14, 2011 through April 27, 2011.     Bulletin 4-2011 Amendment
 
Georgia advises insurers to use leniency when dealing with individuals whose premium payments appear to be late due to mail service disruption and property loss caused by severe weather in April 2011.     Directive 11-EX-5, Directive 11-EX-5A

Mississippi issued a bulletin to provide for a 60-day moratorium on the cancellation/non-renewal of policies for non-payment of premium for Mississippians residing in storm impacted areas.  The bulletin explains how the moratorium extension becomes effective and that the moratorium applies to commercial property, homeowners, dwelling fire and commercial and personal automobile policies.     Bulletin 2011-3

North Carolina issued a bulletin reminding all insurers of the compliance requirements in effect following a disaster or emergency.     Bulletin 11-B-03

Tennessee issued a memorandum asking that "Tennessee licensed property and casualty insurers make every reasonable effort to assist policyholders who have experienced losses as a result of or have otherwise been affected by the floods or storms of this April or May."  The memorandum provides a process for suspending cancellations or non-renewals of policies for the non-payment of premium.     Memorandum dated May 6, 2011


DISASTER PLAN SURVEY

The Texas Commissioner issued a bulletin regarding the Texas State Disaster Coalition Catastrophe Plan.  The plan calls for an annual survey of all insurers doing business in Texas.  The survey includes questions about two types of plans: a catastrophe plan for paying large numbers of claims following a disaster, and a business continuity plan should the company experience a significant business interruption.   The bulletin asks insurers to complete the survey on the TDI website.     Commissioner's Bulletin B-0017-11


FILING REQUIREMENTS

Kansas amended its Code pertaining to rate filing requirements to provide that “disclosure shall not be required for any information contained in a filing or in any supporting documentation for the filing when such information is either a trade secret or copyrighted”.     House Bill No. 2074

New Mexico issued a bulletin to advise property and casualty insurers of the instructions for completing the Maximum % Change and Minimum % Change fields in the Property & Casualty Rate/Rule Filing Schedule.     Insurance Division Bulletin No. 2011-007

Vermont issued a bulletin regarding rate and form filing procedures.     Insurance Bulletin No. 160


HOMEOWNERS INSURANCE

California adopted changes to regulations pertaining to estimating replacement value on homeowners' insurance to exclude certain policies from the meaning of "homeowners' insurance policy".     Title 10 s 2188.65 and 2695.180

Florida enacted legislation amending insurance statute 627.0629 to delete obsolete provisions pertaining to the Citizens Property Insurance Corporation residential property structural soundness evaluation grant program.     House Bill No. 4129

The Louisiana House approved a resolution to urge the Department of Insurance to study the feasibility of prohibiting insurers from imposing more than a 2% deductible, including but not limited to a named-storm or hurricane deductible on any homeowner's insurance policy.     House Resolution No. 18


MISCELLANEOUS

Arkansas amended requirements for annual filings to require that insurers include market conduct annual statements.     House Bill 1813

Idaho approved changes to its Code pertaining to rebates and Illegal inducements, and also replaced references to agents, solicitors, or brokers with the word "producers".     House Bill 283

Iowa eliminated the transfer tax imposed on insurers organized in other states who elect to become domestic insurers in Iowa.     Senate Bill 260

New York issued a memorandum clarifying electronic fingerprint procedures for adjusters, brokers, and insurance company officers and directors.     Memorandum 5-3-2011

Tennessee enacted legislation which, among other things, clarifies the Commissioner's investigatory authority and provides a system of due process for producer investigations.     House Bill 1845


PORTABLE ELECTRONICS INSURANCE

Arkansas enacted new legislation regarding insurance on portable electronics.     Senate Bill 938

New Mexico amended its Code to provide for insurance for portable electronic devices.     Senate Bill No. 393

Oklahoma enacted new laws regarding regulation of the sale of insurance on portable electronics.     Senate Bill No. 801


PREMIUM RATES

Indiana enacted legislation amending its Code concerning excessive, inadequate, or unfairly discriminatory rates.  A statement is added regarding "a rating difference that results from application of a rating plan that is intended to control rate changes applicable to a current policyholder upon renewal of the policy or the transfer of a policy in force among insurers".  Such difference "is not unfairly discriminatory, is not an unfair or deceptive act or practice in the business of insurance . . .."      IN ST 27–1–22–3


PRODUCERS

Idaho issued a bulletin reminding producers of their fiduciary responsibilities including reporting and accounting for premiums and handling of funds.     Bulletin No. 11-01

Ohio issued a memorandum applicable to license renewal requirements and electronic licensing.     Memorandum Dated May 6, 2011


SURPLUS LINES

Arizona enacted legislation to amend its statutes pertaining to Surplus Lines Insurance.     House Bill 2112

Arkansas enacted laws to conform to the federal Nonadmitted and Reinsurance Reform Act.     House Bill 2143

Idaho amended laws pertaining to unauthorized insurers and surplus lines.     House Bill 179

Nebraska revised its Code to conform to the requirements of the federal Nonadmitted and Reinsurance Reform Act.     Legislative Bill 70

New Mexico enacted laws to conform to the federal Nonadmitted and Reinsurance Reform Act.     Senate Bill No. 250

North Dakota enacted new legislation and amended its Code pertaining to surplus lines insurance and enactment of the surplus lines insurance multistate compliance compact.     House Bill 1123

Pennsylvania issued a Notice listing exportable coverages.     Notice 5-7-2011

Washington made several changes pertaining to surplus lines insurance.  Included in the changes were revisions made to provisions pertaining to diligent efforts.     House Bill No. 1694


TRADE PRACTICES

North Dakota enacted legislation relating to limitations on insurance rebates.     House Bill No. 1175

Utah modified its Code to address what constitutes unfair inducements related to insurance.     House Bill 333


WORKERS COMPENSATION

Arizona enacted legislation to amend certain criteria for presenting a claim for a condition, infection, disease or disability involving or related to methicillin-resistant staphylococcus aureus, spinal meningitis or tuberculosis.     House Bill 2476

Kansas approved several changes to the Workers Compensation Act.  New sections were added to the Act, and other existing sections were amended.     House Bill 2134

Montana amended two workers' compensation laws.  Included in the changes is a requirement that managers of manager-managed limited liability companies working in the construction industry be covered by workers' compensation or obtain an independent contractor exemption certificate.     Senate Bill 287

Montana revised the definition of "employee" with respect to agriculture employment.     Senate Bill No. 242

Utah modified its Code to establish procedures for workers' compensation insurance tiered rate filings.     House Bill 27

Utah modified its Code to revise the limits on the amount of the workers' compensation premium assessment.     House Bill 209

Utah modified the Workers' Compensation Act to address the issuance of workers' compensation coverage waivers.     Senate Bill 191

 


  Regulatory and Compliance Services

First Consulting knows how important it is for insurers to complete regulatory and compliance functions effectively and efficiently.  We have assisted our clients with their product forms, rates and rules filings, regulatory research, and other compliance related tasks since 1969.

With CO-SOURCING, you decide exactly what aspects of your project you want us to handle.  No matter how large or small our role, we pride ourselves on meeting your specific needs with our expertise and knowledge.

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

John Palmer
816-391-2744
John.Palmer@firstconsulting.com

 

Sheila Lawrence
816-391-2751
Sheila.Lawrence@firstconsulting.com
 

 



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