Rules, Regs & Bulletins
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Recent Compliance Bulletins from Insurance Compliance Insight | from April 6, 2009 Prior Issues |
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Automobile Insurance
Kentucky HB 309 excludes
the cost of airbags from the calculation of damages that
determine whether a vehicle will be classified as a salvage
vehicle.
Mississippi HB 936 revises the definition
of “uninsured motor vehicle” to include a vehicle owned or
operated by a person who is protected by immunity under the
State Tort Claims Act.
Several Utah Laws deal with
automobile insurance:
• SB 93 provides that a vehicle
with a salvage certificate may be offered for sale or exchange
at an auction to an out-of-state or out-of country purchaser
under some circumstances.
• SB 172 repeals the requirement
that the Insurance Department specify how to notify an
underinsured motorist coverage carrier that all liability
insurers have tendered their liability policy
limits.
• HB 113 says that, under certain
circumstances, a seller of a salvage vehicle isn’t required to
provide written notification that a salvage certificate or
branded title has been issued for the vehicle. That’s only
true when the sale of the vehicle is the result of a total
loss settlement and when the prospective purchaser is a
licensed motor vehicle dealer whose primary business is
auctioning salvage motor vehicles to licensed salvage vehicle
buyers or an insurance company.
Virginia SB 1326 addresses situations
when an insurance company applies for a certificate of title
to a vehicle or a salvage vehicle and cannot get a certificate
of title. In those cases, it should attach an affidavit to the
application indicating that the vehicle was acquired as the
result of the claims process.
Data
Calls
New Hampshire has posted instructions and an Excel
spreadsheet that are to be used for
the 2008 Line of Business Survey. Data is due by May
15.
Health
Insurance
Several states have published
guidance about the American Recovery and Reinvestment Act and
its impact on state continuation coverage requirements. New
Hampshire Bulletin INS 09-023-AB and South Dakota rule 20:60:40
address the matter. Also, an Ohio Insurance Department
April 2 news release notes that a new state law immediately extends the
time to secure mini-COBRA continuation health coverage from
six to 12 months, and also extends eligibility for a federal
subsidy from six to nine months. Finally, Maryland Bulletin 09-06
tells insurers ab out the expected signing into law of
SB 84. The bill
will require insurers and HMOs to provide an extended election
period under ARRA, similar to that required for individuals
eligible for COBRA, for state residents who were:
• covered under small employer
contracts that are subject to the Maryland “mini COBRA”
continuation of coverage requirements; and
• involuntarily terminated from
employment from Sept. 1, 2008 to Feb. 17, 2009.
The emergency legislation will
become effective the day Maryland Gov. Martin O’Malley signs
it into law. That’s expected to be April 14.
Insurance Fraud
California Bulletin 2009-4
reports the Fraud-General Annual billing rate will be reduced
from $5,100 to $2,100, effective July 1. The reduction is due
to operational expenditures being less than originally
anticipated.
UPDATE: Last week
we reported about a March 23 District of Columbia bulletin
that updated requirements for fraud warnings on insurance
applications and claims forms (ICI, March 30, 2009). It gave insurers three options – use NAIC model
language, the District’s approved language and an alternative
version from Maryland. But the District later updated that
bulletin to eliminate the alternate option – and did so in a
way that confused readers. First, it used the same link as the
previous bulletin, so many of you were reading about the
earlier guidance and linking to the later document. Second,
the updated guidance made no reference to the March 23
version. Here’s the straight skinny, according to the March 27 bulletin: Insurers
and HMOs must use either the NAIC or the District’s wording
verbatim, but don’t have to change previous policy forms that
were already approved.
Two fraud bills pending in a Rhode
Island House committee are apparently dead for this session.
HB 5775 would
have clarified the definition of insurance fraud, required
fraud warnings on claim forms and applications, and required
insurer anti-fraud initiatives such as fraud plans or hiring
fraud investigators. Meanwhile, HB 5194 would
have allowed insurers to void the health coverage of a
scheming spouse but would have preserved the innocent spouse’s
coverage in the case of casualty insurance scams.
A Maine legislative committee will
look at legislation this week to create a fraud unit within
the state's Insurance Bureau. LD 1285 would
create the unit, and pay for it with funds the insurance
bureau already receives from the insurance industry. Similar
legislation failed in previous sessions. But LD 14, which
would have made it a crime to steal an airbag, won’t make it
out of the legislature this session.
A proposed Massachusetts bill,
HB 3599, would
set up a task force to review the state’s prescription
monitoring program and recommend ways to improve the
system.
Producers
Iowa IAC 191-11.2
redefines “CE term” as the period of time that begins either
on the date when a new producer's insurance license is issued
or on the date after the expiration date of an existing
producer's license, and that ends on the following license
expiration date.
Mississippi Bulletin 2009-2
discusses the impact of a new law, HB 777, which implements the
NAIC’s uniform standards for producer licensing. The bulletin
highlights changes in the state’s producer licensing practices
that will go into effect Nov. 1.
New Jersey Bulletin 09-09
discusses the dangers of insurance producers with limited line
bail bond authority who may be soliciting, negotiating and
selling immigration bonds without proper authorization.
Producers must have the casualty line of authority to write
immigration bonds, the state says. The casualty line of
authority can be added by completing an approved 20-hour
pre-licensing education course and passing the licensing exam
prior to requesting the addition of the casualty line of
authority to a license.
South Carolina Bulletin 2009-1
has licensing requirements for insurance producers seeking
only surety authority.
Property/Casualty Insurance
Kentucky HB 445 allows an
insurer to waive a deductible in whole or in part for an
insured who experiences food spoilage as the result of a
natural disaster in a county declared to be a federal disaster
area.
Rates,
Forms & Filings
California Bulletin 2009-5
implements increases to cost recovery rates for the filing or
approval of policy forms and other documents. They will become
effective for filings first received on or after July
1.
Colorado Bulletin B-5.18
provides companies with comprehensive guidance on filing
property/casualty insurance rates, rules, loss costs and
forms.
Maine LD 123 requires
that insurers make rate and form filings electronically in a
format required by the insurance superintendent.
Rhode Island has amended Bulletin 2002-17.
All rate and form filing records, including evidence of
approval by the Insurance Division, must be retained as long
as they are in use and for at least three years after the
carrier has told the state that the form has been withdrawn or
superseded. Insurers should refer to Regulations 67 and 73(4)
and to R.I. Gen. Laws § 27-29-4(13) for additional record
retention requirements.
State
Regulation of Insurance
Massachusetts
has posted a notice that these six bulletins from 2007 expired
April 1:
• Bulletin 2007-12; and
New York Circular Letter 7 (2009) and
Circular Letter 8 (2009)
discuss disaster planning, preparedness, and response for
accident and health insurers and HMOs, and for life insurance
companies, respectively. Disaster planning, preparedness, and
response for property/casualty companies was issued last month
in Circular Letter 6 (2009) (ICI, March 30, 2009).
(RR&B is
produced with the assistance of The
CLEAR Report and the Coalition Against Insurance
Fraud.)
Publish date Apr 06 2009
Prior Issues
Reprinted with permission from Insurance Compliance Insight.
Copyright © 2009 ProBusiness Publishing LLC
Licensed from ProBusiness Publishing LLC. All rights reserved.