Property & Casualty News September 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

AUTOMOBILE INSURANCE
New York added a new section to its law permitting insurers to make available multiple rating programs for private passenger motor vehicle insurance within the same company.     NY INS § 2352

New York amended existing law to provide that no insurer shall refuse to issue or renew a covered individually-owned private passenger policy solely on the ground that the motor vehicle to be insured under such policy will be used for volunteer firefighting.     NY INS § 3425 (s)

Rhode Island issued a bulletin regarding an insurer’s obligation to properly inform an insured or claimant of his or her free choice in the selection of an auto body repair shop when a claim is reported.     Bulletin 2004-2 (Amended August 23, 2011)

Texas issued a bulletin regarding the Automobile Burglary and Theft Prevention Authority fee which has increased from $1.00 to $2.00 per motor vehicle.   The bulletin states that the fee may be recouped from policyholders, that an insurer who wishes to recoup the $2.00 per motor vehicle fee must first file the fee in a rate filing, and that insurers who have previously filed and received approval for forms that specified the $1.00 per motor vehicle fee will need to file and receive approval for the revised forms before they are used.  The bulletin also provides notice language regarding the recoupment of the fee.     Commissioner's Bulletin B-0035-11


DISASTER AND EMERGENCY OPERATIONS
Connecticut issued a bulletin regarding Hurricane Irene and encouraging insurers to work with policyholders to arrange premium payment plans in consideration of policyholder hardships.     Insurance Commissioner Bulletin IC-32

Maryland issued the following hurricane-related bulletins: Bulletin 11-24 (Corrected) regarding Emergency Regulation on Claims Information Hurricane/Tropical Storm, and Bulletin 11-25 regarding Hurricane Irene Percentage Deductible Under § 19-209.     Bulletin 11-24 (Corrected) and Bulletin 11-25

New Jersey issued bulletin 11-13 advising insurers of their obligations in the event of a disaster or catastrophic event.   The bulletin also notes that ‘deemer‘ timeframes within which the Department is required to act on a filing from an insurer may be suspended for the duration of the disaster or catastrophic event.  Bulletin 11-16 pertains to the use of hurricane deductibles.  Bulletin 11-17 pertains to disruption and dislocation resulting from Hurricane Irene.     Bulletins 11-13, 11-16, 11-17

North Carolina issued a bulletin directing insurers to N.C. Gen. Stat. § 58-2-46 for guidance pertaining to extensions, deferrals, and other extra requirements applicable as a result of Hurricane Irene.     Number 11-B-09

Rhode Island issued a bulletin concerning insurer obligations following a catastrophic event.   The bulletin discusses adjuster licensing and hurricane deductibles.     Bulletin 2011-5


FILING REQUIREMENTS
Connecticut issued a bulletin regarding the sunset date for flex-rate filings.  The sunset date for all voluntary market personal risk flex-rate filings is extended until 7-1-2013.     Property/Casualty Bulletin PC-70

New York approved changes to its laws concerning rate and policy form filing and approval requirements permitting certain exemptions for policies issued to large commercial insureds and for certain inland marine policies.     SB 5811

South Carolina issued Bulletin Number 2011-09 on 8-31-2011 advising that, effective 12-1-2011, paper filings will no longer be accepted.  This applies to all lines of insurance.  All fees are to be paid by electronic funds transfer.     Bulletin Number 2011-09


HOMEOWNERS' INSURANCE
Alabama issued a bulletin concerning confidentiality of rate filing information and exhibits required with homeowners' rate filings.     Bulletin No. 2011-02

Maryland issued a bulletin pertaining to homeowners' insurance deductibles.  The bulletin reminds insurers of certain requirements applicable when policies are issued with a deductible equal to a percentage of Coverage A - Dwelling Unit for a hurricane or other storm.   Insurers are to provide policyholders with an annual statement concerning the manner in which the deductible is applied, and the form the insurer will use to provide the annual summary to policyholders must be submitted to the Insurance Commissioner prior to the form’s use.  The bulletin provides a due date of 9-30-2011 for policyholder summaries and submission of the form to the Commissioner.     Bulletin 11-20


MISCELLANEOUS
Arkansas issued a Directive concerning gifts provided as an inducement to make an inquiry about or to purchase or renew insurance.     Directive 2-2011

Hawaii enacted legislation pertaining to legal service plans.     Senate Bill 1277

New Jersey issued an Order concerning the imposition of a surcharge for recoupment of the New Jersey Property-Liability Insurance Guaranty Association Assessment.     Order No. A11-109

New York issued a Circular Letter advising domestic insurers who are exempt from Insurance Law Article 15 to furnish a copy of the National Association of Insurance Commissioners' insurance holding company system annual registration statement if the insurer or its parent authorized insurer filed the statement in another state.  Such insurers are also asked to report in advance of engaging in any activity that results in the insurer acquiring control or in advance of engaging in certain other transactions.     Circular Letter 2010-10 (Supplement) (#1)


PORTABLE ELECTRONICS INSURANCE
California has amended laws pertaining to the sale or offer of insurance covering communications equipment and the sale or provision of services for communications equipment.     AB 690

Illinois enacted legislation to establish the Portable Electronics Insurance Act.     House Bill 1284

North Carolina enacted legislation pertaining to portable electronics insurance.     H.B. No. 617


PRODUCERS
Maine issued a bulletin to explain the impact of the repeal of the Independent Producer license authority.     Bulletin 380


SURPLUS LINES
Arkansas issued a bulletin concerning implementation of the Federal Nonadmitted & Reinsurance Reform Act.     Bulletin 5-2011

Arkansas issued a bulletin regarding the licensing of domestic surplus lines insurers.  The bulletin notes that upon written approval of the Commissioner, a licensed domestic insurer possessing policyholder surplus of $20,000,000 or more may write surplus lines insurance.  The bulletin also provides disclosure language for use with surplus lines policies.     Bulletin 8-2011

Delaware issued a bulletin concerning implementation of the Federal Nonadmitted and Reinsurance Reform Act.     Surplus Lines Bulletin 9

New Hampshire issued a bulletin concerning implementation of the Federal Nonadmitted and Reinsurance Reform Act.     Bulletin 11-011-AB

New York amended its regulations to implement the requirements of the Federal Nonadmitted and Reinsurance Reform Act of 2010 (NRRA) and the requirements of New York law pertaining to the NRRA.     11 NYCRR 27.0 +

Utah issued a bulletin concerning implementation of the Federal Nonadmitted and Reinsurance Reform Act.     Bulletin 2011-4


TRAVEL INSURANCE
Michigan issued an Order recognizing Travel Insurance as a limited line of authority, and adopting the NAIC definition of Travel Insurance as described in the Order.  The order also provides that the prelicensure education and examination for applicants applying for a producer license to sell Travel Insurance is waived.     Order No. 11-040-M


 2012 Budgeting

Have you anticipated all your compliance needs, while making your plans and budgets for 2012? 

Whether the need is for a quick answer to a question, assistance in developing a new product, expanding insurance operations (UCAA filings), or operational compliance review, First Consulting can be the solution. Put its knowledge, experience and reputation to work for you and your Company.   

With our Co-Sourcing approach, we can assist in the manner best suited for your company’s unique requirements.  Your staff maintains a role in the process at whatever level is most appropriate for your specific company and project.

Get more information about First Consulting and our services on our website at www.firstconsulting.com.

 Or contact John Palmer
john.palmer@firstconsulting.com
816-391-2744 or 800-927-2730
Or any First Consulting Associate


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Since 1969, First Consulting has been tracking and researching some of the insurance industry’s most important compliance issues.  Now you can put that experience to work for you! 

Our Fraud Compliance Service provides clear and concise summaries on the fraud related topics that are the most important to the insurance industry.  You will find information on fraud warnings, definitions of "fraudulent insurance activities," mandatory fraud reporting requirements, fraud plans and fraud investigation responsibilities.  These summaries include the laws and regulations in all 50 states plus D.C., Guam, Puerto Rico and Virgin Islands.

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 Sean Cox
First Consulting & Administration, Inc.
1020 Central, Suite 201, Kansas City, Missouri 64105
800-927-2730, ext. 2737 or 816-391-2743

sean.cox@firstconsulting.com


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