Annual Statements & Financial Reporting
    Utah is proposing a new financial accounting rule, R590-254. It would require insurers to provide an annual audit of financial statements by independent certified public accountants, communication of internal control related matters noted in an audit and management’s report of internal control over financial reporting. A hear will be held June 23 and the comment period ends July 1.
 
    West Virginia has filed new rule, 114-41-1 to -6, for actuarial opinions and memorandum.
 
 
Automobile Insurance
    Indiana SB 142 provides that if any named insured rejects in writing the uninsured or underinsured coverage, the rejection applies to every other named insured and insured; specifies that an insurer is required to offer only uninsured or underinsured commercial vehicle coverage; provides that an insurer is not required to offer uninsured or underinsured coverage in connection with the issuance of a commercial umbrella or excess liability policy.
 
    Louisiana Regulation 97 permits insurers to offer a premium discount for motor vehicles equipped with a tracking system that assists in the recovery of stolen vehicles.
 
    New Jersey Bulletin 09-15 discloses the statewide distribution of voluntary market written exposures by primary classification.
    The American Insurance Association, the National Association of Mutual Insurance Companies and the Property Casualty Insurers Association of America are urging Oklahoma Gov. Brad Henry to sign HB 1021. The legislation, commonly referred to as the “no- pay/no-play” bill, provides incentives for uninsured motorists to comply with Oklahoma law and purchase insurance. If adopted, an uninsured motorist who sues for damages caused by an automobile accident would not be able to recover non-economic damages. Uninsured motorists would still be able to recover economic damages.  In addition, the bill contains provisions that protect motorists who inadvertently allow their insurance to lapse and does not apply to innocent passengers of an uninsured motorist.
 
 
Credit Scores
    Iowa will hold the first of three public hearings Saturday, May 30, to review insurers’ use of credit scores. Going into the hearings, insurance consumer advocate Angel Robinson said she will be investigating to determine if the state needs to change its rules about the use of credit scores. “I have many questions about the use of credit in insurance ... [and it is] difficult to see a true correlation between credit scores and a person’s home or the ability to drive a car,” she said. Robinson will be publishing a report of her findings to the insurance commissioner that will include her findings as well as policy recommendations. “While we are not seeing sweeping problems, this is a good time to be reviewing its use based upon current Iowa law,” said insurance commissioner Susan Voss.
 
 
Health Insurance
    Colorado has a data call for health insurance costs that’s due by June 1. Read the call letter and preparation notes before completing the survey.
 
    New Jersey has two bulletins of interest to health insurers:
    • Bulletin 09-17 provides guidance about the requirement to provide benefits for medically necessary expenses incurred in the purchase of a hearing aid for a covered person 15 years of age or younger. Benefits are to be provided to the same extent as for any other conditions covered under the plan, but may be limited to $1,000 per hearing aid for each hearing-impaired ear every 24 months. A Q&A discussion provides more clarity about the issue.
    • Bulletin 09-18 gives health insurers more time to notify the Insurance Department of actions it may be taking in the individual health insurance market. The affected companies are those which have elected to offer at least three, but not all, of the standard individual plans after Jan. 4. The rules permitted them, as one option, to make a one-time election to continue to renew the in-force business in the plan(s) it chooses to no longer offer. They had to notify regulators by March 1, but the rule didn’t go into effect until April 20. Bulletin 09-18 corrects that oversight, giving those carriers until July 1 to provide notice.
 
    Oregon is proposing amendments to rule 836-052-0900, physician credentialing. They would adopt the use of applications that collect uniform information needed by health care service contractors to credential physicians seeking designation as participating providers for health plans. The proposed changes would have Oregon conform with national and federal credentialing standards.
 
    Wisconsin is looking at legislation that’s intended to help consumers obtain and keep health insurance. AB 108 would require insurers to have clear guidelines about when and why they can rescind policies. The bill also gives insureds the ability to challenge rescissions.
 
 
Insurance Fraud
    The New Jersey Assembly may expand the state’s immunity law to give insurers more ability to exchange info during fraud investigations without fear of being sued for defamation by targets of the probes. AB 3984 and SB 248 would give broad immunity to insurers when they meet with state law enforcement, prosecutors, the NAIC and the National Insurance Crime Bureau.
 
 
Life Insurance
    Last week, we reported Nebraska was considering changes to rules in Chapter 85, Group Health, Dental, Accident and Life Insurance Under the Intergovernmental Risk Management Act. Those change went into effect May 9.
 
    West Virginia has filed two new rules dealing with life insurance:
    • 114-80-1 to -12 covers viatical settlements; and
    • 114-86-1 to -6 addresses preneed life insurance minimum standards for determining reserve liabilities and nonforfeiture values.
 
 
Long-Term Care Insurance
    Iowa says in a May 21 memorandum that will soon file a Notice of Intended Action to conform current long-term care insurance rules with public law. The Insurance Division intends to file the Notice on July 10 and have the rules be effective Jan. 1, 2010. The draft rules are included in the memo. An informal hearing will be held June 4.
 
    A new Oregon rule going into effect May 29. KAR 40-4-37v requires producers who sell, solicit or negotiate a long-term care partnership program policy to have four hours of initial long-term care partnership program training, and one hour of continuing education in LTC partnership program training each two years thereafter. Those requirements start July 1, 2010. 
 
    A new West Virginia law covering long-term care insurance, 114-32-1 to -31 (and appendices), goes into effect July 1.
 
 
Medicare Supplement Insurance
    Several states are proposing new rules to have their Medicare supplement rules conform to federal statutes and an NAIC model regulation. Details are in:
    • Nebraska Chapter 36, which will also create two new Medicare supplement plans and eventually eliminate the prescription drug benefit for the Medicare supplement plans;
    • Ohio rule 3901-8-08;
    • Oregon regulation 836-052-0119; and
    • Wisconsin rule Ins. 3-39.
 
 
Producers
    Kansas amended rule KAR 40-7-20a gives new guidelines for administering online continuing education courses.
 
    Oklahoma has a significant number of rules changes going into effect July 14 and Nov. 1. They affect producers and providers of continuing education.
 
    South Carolina Bulletin 2009-05 reminds producers and other licensed entities of the need to notify the Insurance Department of a change address, and outlines procedures for doing that.
 
    West Virginia has issued new rules, 114-42-1 to -8, for continuing education for producers. 
 
 
Property/Casualty Insurance
    Alabama SB 1 provides insurance premium credits for homeowners who build a new home or rebuild, upgrade, or retrofit an existing home to better resist future harm from severe weather.
 
    Rhode Island Bulletin 2009-6 has a list of property/casualty insurers that have not complied with a requirement in Bulletin 2009-4 to provide emergency contact and placard information. Any insurer that doesn’t comply by May 29 may be subject to administrative penalties. The list is single-spaced in two-columns over four pages, so there’s a good chance your company might be on it.
 
    A proposed federal law, H.R. 2592, would grant additional pre-disaster mitigation funding to local and state authorities to provide resources for enactment and enforcement of state building codes. Under the proposed legislation, 13 states would qualify for the additional monies, while 10 additional states could qualify with minor legislative modifications. Another eight states have adopted statewide codes, but lack enforcement authorization. Two insurer groups voiced support for the bill. “Every year following a natural disaster, the federal government and the private sector invest billions of dollars in disaster relief to rebuild communities,” said Leigh Ann Pusey, president of the American Insurance Association. “Stronger, safer buildings for Americans and their families during natural disasters can save lives, and ultimately save money, reduce property loss, and reduce public disaster aid,” added Kathy Mitchell, federal affairs director for National Association of Mutual Insurance Companies. H.R. 2592 had not been posted to the Library of Congress THOMAS Web site at ICI’s publication deadline.
 
 
Rates, Forms & Filings
    Colorado Regulation 5-1-10 contains annual rate filing requirements for homeowners and private passenger automobile insurance and establishes requirements for property/casualty rate and rule filings. It goes into effect Aug. 1.
 
    New York has updated its Web page dealing with its Rate Filing Sequence Checklist. New procedures were announced in Circular Letter 5 (2009) earlier this year. The Web page was updated May 18, but it isn’t clear what has been changed and a call to the Insurance Department wasn’t returned before ICI’s publishing deadline.
 
 
State Regulation of Insurance
    A California May 15 notice tells of new vendors for EFT payments (Citibank, replacing Union Bank) and data collection services (Metavante, replacing First Data Corp.), starting July 1. “Our current bank account will only be available for payments up to June 30, for a debit date no later than July 1,” the state is advising. “For example, for a tax payment due on July 1, you will need to successfully schedule the payment by June 30, by 3 p.m. Pacific time.” The notice provides payment instructions.
 
    New Jersey Order A 09-103 reminds insurers to prepare and maintain a disaster response preparation plan to address all reasonably foreseeable risks to the continuity of their business in the event of a catastrophic event.
 
    The Vermont legislature gave final approval to SB 42 providing tax incentives for new Vermont-registered captives. It awaits action by Gov. Jim Douglas, who has indicated he will sign it. Under the bill, captive insurance companies formed in 2009 and 2010 will be eligible for one-time, nonrefundable tax credits of $7,500 to offset premium rates.
 
(RR&B is produced with the assistance of The CLEAR Report and the Coalition Against Insurance Fraud.)

Publish date May 25 2009
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Reprinted with permission from Insurance Compliance Insight.
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