Property & Casualty News
September 2017
Welcome to our latest newsletter! As a thought leader in the Insurance Industry for over 48 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!
ADVERTISING / SALES & MARKETING
Arizona enacted legislation to exempt certain items from classification as advertising/sales material requiring filing. House Bill 2386; 20-1110
Nevada issued a bulletin advising that certain insurers are allowed to provide to an insured or prospective insured prizes and gifts, goods, wares, merchandise, gift certificates, charitable donations, raffle entries, meals, event tickets and other items not to exceed $100 in aggregate value in a calendar year. It provides notice of the withdrawal of Bulletin 10-005A. Bulletin 17-003-W
AGENT / PRODUCER LICENSING AND APPOINTMENT
Connecticut published a notice to all Certified Insurance Consultants (CICs) stating that renewal notifications were emailed to all active licensees the last week of July. If a licensee did not receive the notification, they may email the Department at cid.licensing@ct.gov to request a copy. Other instructions are noted as well. Notice dated August 1, 2017
Illinois amended provisions concerning financial institutions transacting insurance business to stipulate that producer licensing is not required under specified circumstances. HB 759; 215 ILCS 5/1403
New Mexico issued a bulletin to all resident and non-resident license applicants. All applicants are now required to apply using the National Insurance Producer Registry (NIPR) online application process. Paper applications may only be used by applicants who are unable to apply online. Bulletin 2017-010
AUTOMOBILE INSURANCE
Connecticut issued a bulletin to all companies licensed to write automobile liability insurance in the state regarding an increase in the minimum amount of insurance coverage required to issue a motor vehicle operator's license or certificate of motor vehicle registration. Bulletin PC-86
Delaware amended sections of the Delaware Motorist Protection Act, effective December 13, 2017. Included in the changes is an increase in the minimum bodily injury and property damage limits for automobile insurance policies. 603 Form A; 603 s 11.0; 603 s 13.0; 603 s 14.0; 603 s 15.0; 603 s 3.0; 603 s 5.0; 603 s 7.0
CERTIFICATE OF AUTHORITY FILINGS
California issued a notice to all insurers that corporate applications and similar filings needing Department approval by year-end 2017 must be submitted no later than September 15, or, in the case of a holding company application, no later than October 20, 2017. Only "perfected" applications (those filed electronically via Oasis or in duplicate to the Corporate Affairs Bureau with specified inclusions) will receive expedited review. Notice of Year-End Review Procedures dated August 10, 2017
INCLUDE FIRST CONSULTING IN YOUR 2018 BUDGET
Including First Consulting in your 2018 Compliance budget will allow you to accomplish more!
Click here to see just a few ways that First Consulting can help.
CLAIMS / CLAIMS ISSUES
Tennessee promulgated a new regulation addressing Unfair Claims Settlement Practices. 0780-01-05-.01+
CORPORATE GOVERNANCE
Delaware enacted legislation to expand its Code to include Chapter 85, the "Corporate Governance Annual Disclosure Act." The first filing of the CGAD will be in 2018. Senate Bill 40; Chapter 85
CREDIT INFORMATION
Delaware amended its code regarding the use of credit information in personal insurance, effective May 1, 2018. The changes apply to all policies of automobile, motorcycle, boat and personal watercraft, recreational vehicle, homeowners, mobile-homeowners, manufactured homeowners insurance, and noncommercial dwelling fire insurance issued by an insurer for personal or family protection. HB 80; 18 s 2503; 18 s 8301 - 18 s 8304; 18 s 8305 - 18 s 8312
DISASTER / CATASTROPHIC EVENT
New York issued a circular letter regarding claims arising out of flooding of Lake Ontario. The letter reminds all carriers covering homes or businesses in the areas affected by the flooding of their obligations. Circular Letter 2017-10
Texas Bulletin B-00018-17 encourages insurers who deny coverage for wind losses to inform policyholders of potential coverage under the Texas Windstorm Insurance Association (TWIA) if the loss occurred in the TWIA coverage area. Bulletin B-00018-17
Texas Bulletin B-0009-17 regarding Hurricane Harvey asks carriers to provide relief to policyholders in counties covered in the governor's proclamations, including the suspension of premium payments to allow continuing insurance coverage. Bulletin B-0009-17
Texas Bulletin B-0015-17 stating that it is the opinion of the Department that it is inappropriate for insurers to re-rate, cancel, nonrenew, or refuse to provide coverage due solely to a policyholder's status as a victim or evacuee of Hurricane Harvey. Bulletin B-0015-17
Texas Bulletin B-0021-17 asks insurers responding to flood loss inquiries and claims to provide additional information to their insureds about potential Federal Emergency Management Agency (FEMA) assistance and FEMA contact information including the disasterassistance.gov website. Bulletin B-0021-17
Texas issued a bulletin concerning the use of credit information and credit scoring following Hurricane Harvey. Carriers are reminded of their obligations under §559.103, which allows an insurer to grant an exception to an insurer's rates, rating classifications, or underwriting rules for an applicant for insurance coverage or an insured for an extraordinary event. Bulletin B-0016-17
Texas issued a bulletin regarding Hurricane Harvey claims adjusting. The Department encourages carriers to use all available means to provide prompt and immediate relief to residents and policyholders. Bulletin B-0011-17
Texas issued a bulletin regarding Hurricane Harvey relief efforts to provide guidance for insurers. The bulletin states that The Texas Department of Insurance is of the opinion that in instances where insureds or potential insureds are temporary participants in the relief effort of Hurricane Harvey, it is inappropriate for insurers to re-rate, cancel, nonrenew, or refuse to provide coverage due solely to that participation. Bulletin B-0013-17
Texas issued a bulletin reminding adjusters, building and repair contractors, and insurers, that an insurer or its representative, or any other person, may not misrepresent the terms and provisions of a policy. In addition, under §5.9970 persons insured under a homeowners or dwelling policy are entitled to have their home repaired by the person of their choice. Bulletin B-0017-17
FINANCIAL EXAMINATIONS
Florida promulgated a rule adopting the National Association of Insurance Commissioners Financial Condition Examiners Handbooks 2017 and 2016, incorporating them by reference. FAC 69O-138.001
FLOOD INSURANCE / NFIP
Hawaii enacted legislation concerning the state's participation in the National Flood Insurance Program. HB 1418
GUARANTY ASSOCIATION
New Jersey published an order regarding the imposition of a surcharge for recoupment of the New Jersey Property-Liability Insurance Guaranty Association assessment due September 15, 2017. Order No. A17-110 Dated August 3, 2017
HOLDING COMPANIES
The U.S. Virgin Islands enacted legislation to repeal title 22 Virgin Islands Code section 1251(a) and add chapter 14 entitled "The Virgin Islands Insurance Holding Company System Regulatory Act" to meet accreditation standards of the National Association of Insurance Commissioners. House Bill 42
LIABILITY INSURANCE
Louisiana issued an opinion stating that a combined single limit policy of liability insurance with a single limit of $3 million satisfies the minimum liability insurance requirement of LA R.S. 9:2795.6(F), which is stated in terms of split policy limits. Attorney General Opinion 17-0108
Are you considering a change with your products?
These changes involve many steps – from the concept of a new product, or change to an existing product, to implementation.
Click here to learn how First Consulting can help.
MARKET CONDUCT EXAMINATIONS
Missouri enacted legislation providing that if an insurance company is required to pay interest on any claims, refunds, penalties, or payments under a market conduct examination, or any other legal or remedial action and the interest rate is not provided for by law, interest will be at the annual adjusted prime rate of interest, but under no circumstance shall such interest rate exceed 9% per annum. House Bill 292, 374.191
Pennsylvania issued a notice providing the new per diem charges for market conduct examinations of insurance companies. Notice 2017-08
MARRIAGE EQUALITY / CIVIL UNIONS / DOMESTIC PARTNERS
Rhode Island amended its law entitled "Unfair Competition and Practices" by adding a definition of domestic partnership and listing among such practices any unfair discrimination by treating domestic partners differently than marriage partners for purposes of premiums, policy fees or rates charged for policies of casualty, fire, homeowners, marine or automobile insurance. House Bill 5951A; 27-29-2, 27-29-4
MISCELLANEOUS
New York issued a circular letter to all insurers regarding the insurance industry's position to influence the economic effects of climate change. It urges all insurers to complete the annual Climate Risk Disclosure Survey and provides examples of day-to-day operations that can have a positive effect on the environment. Circular Letter 2017-9
OMNIBUS LEGISLATION
Arkansas issued a bulletin regarding the amendment of several property and casualty regulations including the Motor Vehicle Service Contract Act, Captive Insurance Companies, and the depreciation applicable when determining the value of damaged property. Bulletin 13-2017
PREMIUM TAX
Alaska issued a regulatory order requiring use of Online Premium Tax for Insurance portal (OPTins) for reporting and payment of premium tax, effective with the 2017 reporting year (due March 1, 2018). Regulatory Order No. R 17-05
Delaware issued a bulletin informing all admitted and approved domestic and foreign insurance companies, including foreign risk retention groups, risk purchasing groups, accredited reinsurers, and surplus lines insurance companies, that premium tax reports and fees must be filed through the Online Premium Tax for Insurance portal (OPTins). The Department will not accept paper filings on or after January 1, 2018. Domestic/Foreign Insurers Bulletin No. 96
PROPERTY INSURANCE
Arkansas issued a bulletin clarifying that based on recent legislation, expense depreciation is permitted when determining loss under an insurance policy covering damaged property. "Expense Depreciation" is defined as depreciation, including but not limited to the cost of goods, materials, labor, and services necessary to replace, repair, or rebuild damaged property. Bulletin 10-2017
REPORTS - DATA CALLS & OTHER REPORTS
Texas issued a bulletin regarding the Terrorism Risk Insurance Data Call which is due September 30, 2017. The New York Department will serve as the single point of collection for this data call. Bulletin #B-0007-17
RISK RETENTION GROUPS
Colorado amended its regulation concerning the formation and/or operation of risk retention groups and purchasing groups, effective October 1, 2017. 3 CCR 702 Reg. 2-1-8
SERVICE CONTRACTS / WARRANTY INSURANCE
Illinois amended requirements concerning vehicle protection products. HB 3072
SURPLUS LINES
Alaska issued a bulletin providing an updated whitelist of eligible surplus lines insurers. Bulletin B 17-05
Alaska issued a bulletin regarding line codes to be used on the Report of Surplus Lines Transaction form. Bulletin B 17-06
TRANSPORTATION NETWORK
Alaska issued a bulletin regarding requirements for transportation network company operations. Bulletin B 17-04
TRAVEL INSURANCE
Connecticut enacted legislation regulating the offer and dissemination of travel insurance, defining terms and specifying fees for licensing, among other details. House Bill 7024
INCLUDE FIRST CONSULTING IN YOUR 2018 BUDGET
It’s hard to believe that next year’s budget process is already upon us. However, including First Consulting in your 2018 Compliance budget will allow you to accomplish more!
Here are just a few ways that First Consulting can help:
• New Product Development & State Variation Drafting – utilize our expertise to make developing a new product stress-free.
• Product Filing – overload assistance when in-house staff are stretched to the max, and we can use Your SERFF Instance!
• Research – get that research/survey project off your desk, and allow First Consulting to complete that work anonymously with each state.
• Compliance Monitoring/Oversight - Staying current on state and federal compliance updates can be difficult and time consuming. We track, analyze, summarize and forward these updates to your staff. We can also recommend any necessary changes.
• Certificate of Authority – admission in a new jurisdiction, name change, assumption, and more.
• ERM/ORSA & Corporate Governance – Our turnkey tool kits simplify the ORSA and Corporate Governance reporting.
• Compliance Risk Management – Our hands on approach can identify “gaps” in operational compliance with a review of current procedures; assess priorities for a plan of action; and provide proven alternatives and best practices.
• Anti-Fraud, AML, OFAC and Privacy Training – our online training satisfies the state requirements for underwriters, call center personnel, claims handlers and other integral personnel. Plus this research was recently updated for 2018.
Contact me for a no obligation proposal and cost estimate.
Sean Cox
816.391.2737
Sean.Cox@FirstConsulting.com
PRODUCT CHANGES MADE EASY
Are you considering a change with your products?
These changes involve many steps in the product development process – from the concept of a new product, or change to an existing product, to implementation. First Consulting can help in many ways:
Product Development - comparison of your forms or those of competitors or rating bureaus, or participation in the development of a new product. Our experts can assist in all lines of business. You can also use our experts to give your forms that second set of eyes to ensure everything has been included and “fits” properly.
State Amendatory Drafting – we can save your staff valuable time by incorporating necessary state-specific requirements or the state-specific changes marketing wants into your products.
Form and Rate Filings – our filing team can accelerate this time consuming process, allowing your staff more time to focus on the work that truly requires their expertise. Plus we can make these filings on Your SERFF Instance!
Please give me a call so we can discuss your plan to see how we can help with your ever changing product line.
Joe Bieniek
816.512.2832
Joe.Bieniek@FirstConsulting.com