Property and Casualty News
March 2015
We are celebrating over 25 years of providing selected items of current interest to our clients and friends. The items contained in this newsletter are derived from bulletins, regulations and legislative activity affecting the insurance industry. Please feel free to share this newsletter with others that may be interested. Contact our office for further details about any of the items contained in the newsletter.
Are you ready for TRIA 2015 Renewal?
Many entities and compliance professionals have now dealt with the drafting and filing needs related to the Terrorism Risk Insurance Program Reauthorization Act of 2015 signed by President Obama on January 12, 2015. There will be more activity in the upcoming weeks and months. First Consulting has set up a web page to keep you apprised of the various activities by the insurance regulators. You can access the information here.
ADJUSTERS
Kentucky issued a notice to companies sending unlicensed adjusters to assist with claims from the winter storm event February 16-22. Form 8307 must be completed to register the adjusters with the Department of Insurance. The form should be submitted by the insurer, not the adjuster or other entity. Adjuster Notice 2015 Catastrophe Serial No. 68
AGENT / PRODUCER COMPENSATION
New Hampshire issued a bulletin specifying permissible forms of insurance producer compensation. Bulletin of February 18, 2015
AGENT / PRODUCER LICENSING AND APPOINTMENT
Alaska released a bulletin regarding changes in processing and fees for producer licensing through the National Insurance Producer Registry (NIPR). The division is streamlining its processes to be more efficient and more conforming with national standards. Bulletin B 15-03
AGENT / PRODUCER LICENSING AND APPOINTMENT; FEES
Colorado issued a bulletin extending time for continuing education requirements for producers licensed to write and post bail bonds. If the license of a producer expires in 2015, the satisfaction of the continuing education requirements is extended to 2016. Bulletin B-1.31
Rhode Island issued a bulletin announcing that, through the NIPR, it is offering an electronic system for insurance producers, adjusters, motor vehicle damage appraisers and surplus lines brokers to submit changes to their address, email, telephone and fax information. Bulletin 2015-4
AUTOMOBILE INSURANCE
Arizona released a bulletin correcting the annual update of the threshold amount of property damages insurers may use to nonrenew private passenger automobile policies, which had been published under Bulletin 2015-01. Bulletin 2015-01A
California posted a notice to all property and casualty broker-agents, personal lines broker-agents, limited lines automobile insurance agents and other interested parties concerning automobile insurance for license holders qualifying under Assembly Bill 60 (non-citizen licensure). It states that such license holders may be less familiar with some insurance products, so it is extremely critical for them to be treated fairly and ethically. Notice dated February 12, 2015
New York issued a circular letter to provide guidance to no-fault insurers in view of recent court cases. Circular Letter 2015-1
Vermont issued a bulletin providing updated guidance to insurers settling total losses using a price guide. It supersedes Bulletin 162 only as it relates to Section 8(b)3 of Regulation 79-2 and the use of a published price guide. Bulletin 182
Virginia revised its statutes to address transportation network companies, with a licensing process and required screening of drivers for various safety issues. SB 1025
CANCELLATION / NON-RENEWAL / PREMIUM OR COVERAGE CHANGES
Iowa published a bulletin regarding delivery of cancellation, nonrenewal and termination notices by electronic means. After review, the Division concluded that satisfactory proof of delivery could not be provided electronically, so mailed notices must continue to be delivered. Bulletin 15-01
Virginia amended its provisions to authorize insurers to send notices, including nonrenewal and cancellation notices, pertaining to a motor vehicle or homeowners' policy, by a first-class mail tracking method used or approved by the U.S. Postal Service. Provisions providing more restrictive options have been removed. SB 697
DATA CALLS / REGULATORY REPORTING
Pennsylvania issued a notice announcing that it is conducting a medical malpractice data call. Carriers are to respond no later than April 1, 2015. Notice of February 7, 2015
DEPARTMENT OF INSURANCE
Arkansas released a bulletin announcing the Commissioner's intent to adopt the amendments, revisions or modifications to the Accounting Practices and Procedures Manual as of March 2014, published by the National Association of Insurance Commissioners. Bulletin 4-2015
ELECTRONIC TRANSACTIONS
Alaska issued an order regarding use of electronic transactions and communications for conducting the business of insurance. The stated purpose is to identify circumstances where regulated parties may use electronic communications or transactions/records instead of written versions. Order R15-03
INDUCEMENTS
Tennessee issued a bulletin addressing gifts to consumers as marketing promotions to solicit additional business, citing the Unfair Trade Practices and Claims Settlement Act, which prohibits rebating. Bulletin of February 13, 2015
MISCELLANEOUS PROPERTY/CASUALTY
Michigan amended its laws to provide certain conditions under which a person is not entitled to be paid personal protection insurance benefits for accidental bodily injury. SB 1140
Oklahoma published a bulletin regarding Earthquake insurance, excluded loss, inspection of insured property and adjuster training. Bulletin PC 2015-02
ORSA: OWN RISK AND SOLVENCY ASSESSMENT
Illinois issued a bulletin notifying all insurers with Illinois as their lead state regulator that the first Enterprise Risk Filing required by Section 5/131.14b of the Insurance Code must be submitted in 2015. Regulation is not yet completed, but Form B is to be prepared and submitted by May 1, 2015 with a $200 filing fee and Form F (no additional fee) is due the same date. Bulletin 2015-4
PERSONAL LINES INSURANCE
District of Columbia issued a bulletin directing that insurers opting to use credit scores as factors to rate policies without reviewing credit scores at least annually must afford every policyholder the right, annually at any renewal, to request and receive a rate determination that considers the most recent credit score and must notify policyholders of these rights. Notification is to be done by a disclosure in the initial policy document and all subsequent renewal letters. The disclosure is also to be included in the form filing submitted to the Department for approval. Bulletin 15-IB-01-02/03
PROFESSIONAL LIABILITY INSURANCE
Indiana released a bulletin notifying physicians and hospitals of a surcharge for qualification under the Medical Malpractice Act. Rates are effective for coverage beginning April 1, 2015. Bulletin 213
PROPERTY INSURANCE
Mississippi issued a bulletin announcing that, effective May 1, 2015, insurance companies required to complete and submit the Fire Loss Registry Form will do so electronically, no later than 45 days after the event. Bulletin 2015-1
RATEMAKING
California posted a notice regarding unfair discrimination in rating, specifically, the practice of Price Optimization. It states that any insurer currently using price optimization to adjust rates in California shall cease the practice. It also directs that any insurer that has a factor or factors based on price optimization in its rating plan shall remove the factor(s) in its next filing, which is to be submitted no later than 6 months from the date of the notice. Notice date February 18, 2015
Ohio issued a bulletin regarding Price Optimization, declaring it unfairly discriminatory and requiring rate filings to replace any using price optimization. Filings are due no later than March 31, 2015 with proposed effective dates no later than May 31, 2015 for new business and June 30 for renewal business. Bulletin 2015-01
SURPLUS LINES
Alaska issued an order regarding the surplus lines placement list. The order replaced Order R 14-01 and states that the list for 2015 will be the same as the 2014 list. Order R15-02
New Mexico published a bulletin providing a list of coverages the Superintendent determined to be generally unavailable in the authorized market currently and are therefore exportable. Bulletin 2015-007
TITLE INSURANCE / AGENTS
Maryland published a memo to owners and designated responsible producers of title insurance agencies regarding the Maryland Affordable Housing Trust (MAHT) and interest on Trust transactions payable at least quarterly to MAHT. Reporting of accurate and complete information for the previous year is required to be filed by March 31. Memorandum dated March 2, 2015
TRAVEL INSURANCE
Florida issued an informational memorandum reminding insurers that automatically charging consumers for ancillary travel insurance without consumers' informed consent is prohibited as an unfair trade practice. Informational Memorandum OIR-15-01M
DRAFTING AND PRODUCT DEVELOPMENT HELP
First Consulting can help you in your drafting and product development needs. Whether it is developing a new program from scratch or making changes to an existing program, we can help.
We have knowledge and expertise of drafting policies, state amendatory endorsements and endorsements for all product lines. You can provide us your concept for us to draft the various forms or we can be another set of eyes in reviewing your work. First Consulting can help with individual products or with modifications agents or companies feel are necessary if you are using bureau policies. We can also assist in drafting forms if you are converting either to or from ISO and AAIS forms.
Please click on the following link for a brief overview of our Product Development and Drafting service http://www.firstconsulting.com/services/product-development.
Call me to discuss your needs.
Joe Bieniek
816.512.2832
Joe.Bieniek@FirstConsulting.com
FIRST CONSULTING NOW OFFERING EMPLOYEE ANTI-FRAUD TRAINING
First Consulting is committed to helping insurance companies with state anti-fraud training requirements for underwriters, call center personnel, claims handlers and other integral anti-fraud personnel. Training is available for companies selling life and annuity, health and accident, as well as life settlement companies, all of which are held to training standards by most state regulators. A version for property-casualty insurers will be available soon.
Visit our Anti-Fraud Training webpage or contact me to learn how we can assist you with Anti-Fraud Training or to schedule a demo!
Carol Stern, FLMI, AIRC, ACS
816.391.2746
Carol.Stern@FirstConsulting.com
