Property & Casualty News
June 2018
Welcome to our latest newsletter! As a thought leader in the Insurance Industry for over 49 years we are always excited to share the latest sampling of insurance compliance related bulletins, regulations and legislative activity. Please feel free to share this newsletter with others that may be interested. Contact Us with any questions on the items in this newsletter or with any other compliance related matter we can assist you with. Enjoy!
AGENT / PRODUCER CONTINUING EDUCATION
Rhode Island has amended regulations regarding continuing education for insurance producers. Amendments were made to approved courses as well as approved providers and course submissions. 230-RICR-20-50-2.7; 230-RICR-20-50-2.8
Texas has reduced the number of required continuing education hours for certain licensees from 30 hours per reporting period to 24 hours per reporting period. This change does not affect licensees subject to the 10 hour continuing education requirement. 28 TAC s 19.1003+
AGENT / PRODUCER LICENSING AND APPOINTMENT
New Hampshire will now require any licensed insurance company authorized to transact fire or casualty business in this state to provide 120 days' notice to its appointed agents of record in New Hampshire of the insurance company's decision to cease writing an entire line of business. HB 1308; 402:84
South Carolina amended provisions regarding fingerprinting requirements when applying for an insurance producer license. 38-43-100
AUTOMOBILE INSURANCE
Idaho has revised regulation IDAPA chapter 18.01.20 regarding automobile insurance policies. Changes include requirement for new UM/UIM form to be used by Jan.1, 2019. Documentation of UM/UIM compliance on new policies and when coverage is added or deleted is required. IDAPA 18.01.20 s 001 +
New York has amended this regulation requiring individual motor vehicle liability insurance policies, entered into on or after June 16, 2018, to provide Supplementary Uninsured/Underinsured Motorist (SUM) insurance for bodily injury. Amended language outlines new coverage requirements and provides opt out information. Emergency 11 NYCRR 60-2.0
Oklahoma is creating the new Oklahoma Compulsory Insurance Verification System (OCIVS) which will be overseen by the Oklahoma Insurance Department. The Commissioner will notify all private passenger auto insurance companies in Oklahoma that they are required to participate in OCIVS using a web service that allows access to the insurers' real-time book of business. Oklahoma Insurance Department Daily Digest Bulletin dated 06/05/18
CAPTIVES
Arizona amended its regulations concerning fees and taxes, including premium tax, paid by captive insurers. SB 1101; 20-1098.17
CERTIFICATES OF INSURANCE
New Hampshire has amended legislation to allow, with the permission of the policyholder, an insurance producer to provide any bank or lending institution with copies of insurance documents relating to the subject property. The insurance producer shall not be required to analyze or warrant any provisions of the insurance policy. 412:6-b
CLAIMS / CLAIMS ISSUES
Oklahoma has amended the Unfair Claims Settlement Act to change the time that first party claimants shall be advised of acceptance or denial of a claim by the insurer. 36 s 1250.7
COMMERCIAL LINES INSURANCE
New Hampshire amends a bill changing the definition for the term large commercial policyholder by decreasing the amount of aggregate property and casualty insurance premiums, excluding workers compensation, from $50,000 or more to $25,000 or more. HB 1389, 412:3+
Tennessee is exempting certain types of insurance coverages from filing requirements with respect to rates, supplementary rate information, policy forms and endorsements. 56-5-106, 56-5-107, 56-5-122
ARE YOUR FILES DOCUMENTED CORRECTLY FOR SCHEDULE RATING?
Documenting schedule rating in commercial lines is an important item regulators look at when they conduct Market Conduct Exams. Don’t let your Company get fined and penalized. First Consulting can help. Click here to learn more.
CONFIDENTIALITY / PRIVACY
Arizona amended its regulations relating to personal information and data security breaches. HB 2154, 18-551 +
Oklahoma issued a bulletin to clarify that a licensee of the Oklahoma Insurance Department, subject to the privacy notice requirements under the Gramm-Leach-Bliley Act (GLBA), does not need to provide the annual privacy notice under GLBA under certain conditions. Bulletin No. EX 2018-01
Rhode Island amended its regulation regarding privacy of consumer information. 230-RICR-20-60-7
South Dakota enacted legislation requiring notice to consumers and the Attorney General regarding any breach of system security where a resident's personal or protected information was, or is reasonably believed to have been, acquired by an unauthorized person. Notice must be given within 60 days from the discovery of the breach. Uncodified SB 62 s 2
CORPORATE GOVERNANCE
Nevada added provisions that allows for insurers to customize the format of the corporate governance annual disclosure along with other new regulations for filing procedures. NAC 692C (LCB File No. R094-17) Dated 09/06/17
Oklahoma enacted the Insurance Business Transfer Act (IBTA). This act establishes the requirements for notice, disclosure, standards and procedures for the approval of the transfer and novation by the Oklahoma Insurance Commissioner and the District Court of Oklahoma County pursuant to an Insurance Business Transfer Plan. SB 1101/36 s 1681-1688
Tennessee enacted legislation to create the Corporate Governance Annual Disclosure Act. The purpose of the Act is to outline requirements for completion of a corporate governance annual disclosure and provide for the confidential treatment of the disclosure and related information. HB 1808; 56-2-901 +
CREDIT FOR REINSURANCE
Nebraska adopted updates to the NAIC's credit for reinsurance model law, effective July 19, 2018. LB 815; 44-416.06; 44-416.07; 44-416.09
CYBERSECURITY
South Carolina's governor has signed the South Carolina Insurance Data Security Act. The purpose of the act is to establish standards for data security and standards for the investigation of and notification to the director of a cybersecurity event. HB 4655, 38-99-20 thru 38-99-100
DISASTER / CATASTROPHIC EVENT
Maryland's governor declared a State of Emergency due to severe storm and flooding. Maryland Insurance Administration encourages insurers to provide reasonable accommodations, including a grace period for premium payment, to policyholders that reside in and the businesses located in several zip codes to prevent and avoid cancellation of insurance. Bulletin 18-09 and Bulletin 18-07
North Carolina's governor has issued an executive order declaring a state of emergency in many counties in response to the flooding, road closures, and landslides from sustained rains due to Subtropical Storm Alberto. This declaration will remain in effect until rescinded. Executive Order No. 44
DISASTER PREPAREDNESS
New Jersey released a bulletin to provide guidance to insurers regarding pre- and post-disaster regulatory activity. Bulletin 18-05
New York released a circular letter setting the standards expected of many authorized insurers in planning, preparing for, and responding to disasters occurring anywhere in the world that could affect the ability to continue doing business and servicing the people of New York. Circular Letter 3 (2018)
North Carolina issued a bulletin for all licensed property/liability insurance companies regarding procedures catastrophic adjusters will need to follow if a catastrophic event were to occur in the state. Bulletin 18-B-5
North Carolina issued a bulletin for all licensed property/liability insurance companies regarding procedures catastrophic motor vehicle damage appraisers will need to follow if a catastrophic event were to occur in the state. Bulletin 18-B-6
DISCLOSURE REQUIREMENTS
Michigan has issued a bulletin warning against "insurance sliding" by insurance producers. "Sliding" is failure to disclose all products and services included in an insurance transaction, resulting in excessive charges to the customer. Bulletin No. 2018-12-INS
FILING REQUIREMENTS / PROCEDURES
Kentucky has revised regulations regarding P&C, title, surety, and mortgage guaranty insurance form filings. Changes include definitions, requirements for electronic submission, and disapproval of previously exempt forms. 806 KAR 14:006
FRAUD / ANTI-FRAUD
Oklahoma sent out a special notice about the Anti-Fraud Assessment Annual Fee that is due by July 1, 2018. It must be paid electronically through OPTins. Special Notice Regarding 2018 Anti-Fraud Assessment Fee
HALF-TIME FOR 2018 COMPLIANCE TRAINING
2018 is almost halfway over! Have your staff training goals been met? Click here to learn how First Consulting can help you.
INDUCEMENTS
Pennsylvania amended the code adding an exception to the restrictions to inducements that an insurance producer may offer. An insurance producer may not make receipt of anything of value contingent on the purchase of insurance. 40-25-1245; 40-25-1246
ADVERTISING COMPLIANCE EVENT and SOCIAL MEDIA MINI-BOOTCAMP
Don’t be left out. This seminar will share advertising and social media compliance expertise and insight to help you maintain regulatory and ethical compliance. Click here to learn more!
PREMIUM ISSUES
Alabama issued a bulletin rescinding a Bulletin dated July 17, 2000, regarding Installment Fee Plan filing requirements. Questions about premium installment plans should be directed to the DOI Rate and Forms Division. Notice 05-09-18 Installment Fee Plan
PROPERTY INSURANCE
Colorado issued a bulletin stating that lender-placed insurance on residential property is considered commercial insurance rather than personal homeowners insurance. Bulletin B-5.34
PUBLIC RECORDS
New Hampshire added a subsection to its Code stating forms and rates that are filed for review in accordance with Title XXXVII shall be confidential pending approval. An approved filing and any supporting information that is not otherwise exempt from disclosure will be open to public inspection on or after the date the filing is approved or its effective date, whichever is later. HB 1379; 400-A:15-e
RATEMAKING
Texas issued a bulletin to remind insurers to use the new, revised tax rate and to update the tax assumptions in their ratemaking methodologies. Insurers subject to filing requirements must update relevant calculations and exhibits demonstrating use of the updated tax provisions in their rate filings. Bulletin B-0009-18
REPORTS - DATA CALLS & OTHER REPORTS
Delaware issued notice regarding adoption of an Indemnity Data Call. The Data Call will mirror the NCCI Indemnity Data Call, which requires two separate reporting records. Testing and optional reporting will begin in mid-year 2019, with the first Data Call occurring in the second quarter 2020. DCRB Circular No. 950
Kentucky has issued a data call to certain P&C insurers requiring submission of updated premium rates for private passenger automobile and homeowner insurance. The data call is due by July 9, 2018 (45 days from the effective date of the Order). Order of May 25, 2018
Texas issued a data call applying to property and casualty insurers currently writing new personal automobile or residential property business. The Texas Department of Insurance will notify insurers by email if they meet the criteria and must report. Data is due to TDI on 07/06/18, for rates effective 06/01/18. Bulletin B-0012-18
TITLE INSURANCE / AGENTS
Florida revised a regulation concerning unlawful rebates and inducements related to title insurance transactions. FAC Rule 69B-186.010
Idaho amended regulations regarding title insurance. Uncollected cancellation fees for issuance of title commitments has been removed from the definition of "things of value", and previously listed prohibited practices have been removed. IDAPA 18.01.56 s 010
South Carolina amended provisions concerning fees and taxes pertaining to the title insurers' portion of the premium in the retaliatory tax computation. This subsection is effective for all premiums collected after the effective date of this act. HB 4962; 38-7-90
TRAVEL INSURANCE
Pennsylvania created the Travel Insurance Modernization Act to provide for the licensure of limited lines travel insurance producers and to establish requirements for sale of travel insurance. SB 630; Uncodified SB 630 s 1 +
WORKERS' COMPENSATION
Arizona issued a notice regarding medical-only claims. Form 104 (Notice of Claims Status), must be used. The change is effective August 20, 2018. Notice of May 18, 2018
Colorado adopted amendments regarding workers' compensation insurance premium and payroll surcharges. Revisions include forms for surcharge returns, and semiannual payroll reporting to the Workers' Compensation Division, and deadlines for reports. 7 CCR 1101-3 Rule 2
Georgia revised the Georgia EDI Claims Release 3.0. Changes include replacing Social Security Numbers with a jurisdiction assigned number, and acceptance of medical-only claims. Revisions are effective December 1, 2018. EDI Claim Release 3.0 Updates
Indiana issued notice that Public Law 204 will go into effect July 1, 2018 and Public Law 206 will go into effect January 1, 2019. Public Law 204 relates to timeframes and penalties for failing to maintain coverage. Public Law 206 relates to prescription drug formularies. Notice of May 2, 2018
New Jersey's governor has established the Task Force on Employee Misclassification to combat the misclassification of employees as independent contractors to deprive them of legal rights and protections. Executive Order 25
Texas' Division of Worker's Compensation is releasing new research that could help reduce costs for insurance carriers. The full report can be found at http://www.tdi.texas.gov/reports/wcreg/documents/multinj.pdf Division of Workers Compensation Notice Dated 06/04/18
HALF-TIME FOR 2018 COMPLIANCE TRAINING
2018 is almost halfway over! Have your staff training goals been met?
First Consulting offers:
• Anti-Fraud – L&H and P&C
• Privacy
• OFAC (Office of Foreign Asset Control)
Which one(s) does your staff still need this year? Click here to learn more, or contact me today for a free Preview and see what you’ve been missing!
C. J. Rathbun, FLMI, CCEP, HIA, AIRC
816.391.2740
CJ.Rathbun@FirstConsulting.com
ARE YOUR FILES DOCUMENTED CORRECTLY FOR SCHEDULE RATING?
Documenting schedule rating in commercial lines is an important item regulators look at when they conduct Market Conduct Exams. Schedule rating documentation has been a problem in the industry for a long period of time and we see companies being assessed fines and penalties annually.
1. Do you know how your underwriters are documenting files?
2. Would a webinar on learning the documentation techniques of schedule rating be of interest?
3. Would you like to learn more about correct documentation for schedule rating?
Please let me know.
We can perform a mock target exam on your schedule rating documentation. With our Compliance Risk Management service, we have the expertise to assess your risk.
Joe Bieniek
816.512.2832
Joe.Bieniek@FirstConsulting.com