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For Immediate Release
November 6, 2020
Contact: Tess Badenhausen
(732) 201-4133

FORMER NCOIL PRESIDENT, NY SENATOR JOHN DUNNE, DIES AT AGE 90

Manasquan, NJ – NCOIL responded today to the passing of former NCOIL President, Senator John Dunne of NY. “We at NCOIL are saddened by the loss of Senator Dunne and invite you to keep him and his family in your thoughts and prayers at this time,” said NCOIL CEO, Commissioner Tom Considine.

Dunne served as a New York State Senator for 23 years, then went on to serve as Assistant U.S. Attorney General for Civil Rights during the George H.W. Bush administration.

After graduating from Georgetown University and Yale Law School, Dunne served in private practice for several years as a partner in the law firm of Rivkin, Radler, Dunne & Bayh. He later worked as senior counsel to the firm of Whiteman Osterman & Hanna LLP in Albany.

During the 1971 Attica riots, Dunne, then chairman of the Corrections Committee, entered the prison with Asm. Arthur Eve to negotiate with inmates and seek a peaceful resolution for them and their hostages. Dunne later became instrumental in addressing prisoner reform issues.

Senator Dunne served as NCOIL President in 1982, where he told the NAIC that model laws would have a better chance of passage if legislators were involved earlier with the development of their “exposure draft.”

Current NCOIL President Matt Lehman, IN, says, “We are lucky to have someone like Dunne as a part of NCOIL’s history. He made a large and lasting impact during his life and we know he will be missed by all who knew him.”

Senator Dunne was 90 years old and passed away in his home. Dunne was married to his wife, Denise for 62 years and they have 4 children together.

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy four years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.

 

For Immediate Release
November 4, 2020
Contact: Tess Badenhausen
(732) 201-4133

NCOIL STAFF TO PARTICIPATE IN “NO-SHAVE NOVEMBER” FOR FIFTH CONSECUTIVE YEAR
Effort Raises Funds & Awareness for Cancer Research

 

Manasquan, NJ – NCOIL CEO Commissioner Tom Considine, General Counsel Will Melofchik, and Intern Patrick Gilbert have begun NCOIL’s fifth consecutive participation in “No-Shave November”.

“For these past five years, the NCOIL staff has tossed aside their razors for the month of November, and this year, we are right back at it. As some of you know, I am a cancer survivor and sadly lost my mom to this disease. The fight against cancer has always been personally important, now more than ever” said Considine.

No-Shave November’s mission is to raise funds for cancer research and treatment, and to educate the population about preventive measures. Starting with the surviving children of one father who died of cancer in November 2007, the movement has since spread around the globe. Participants put down their razors for 30 days each year to join the fight against cancer. This year, NCOIL Support Services will make contributions to the Melanoma Research Foundation (MRF) and the Prostate Cancer Foundation (PCF).

The MRF is the leading melanoma community to transform melanoma from one of the deadliest cancers to one of the most treatable. Melanoma diagnoses are increasing at epidemic rates, claiming more 7,000 American lives every year. It is the deadliest form of skin cancer. However, nine out of ten cases are considered to be preventable. The MCF’s mission is to eradicate melanoma by accelerating medical research while educating to and advocating for the melanoma community.

The PCF funds the world’s most promising research to improve the prevention, detection, and treatment of prostate cancer and ultimately save patients’ lives. Right now, one man dies every 17 minutes from prostate cancer in the United States. PCF’s goal is to end all deaths from prostate cancer by raising awareness and funding urgent cutting-edge research.

NCOIL General Counsel, Will Melofchik, said, “I am proud to say this is the fifth year that I will be participating in No-Shave November to benefit a very worthy cause. I am happy to do my part to help fight this disease that affects so many.”

The No-Shave November campaign has successfully raised over millions of dollars to combat this disease. Every dollar raised brings us one step closer in our efforts to fund cancer research and education, help prevent the disease, and aid those fighting the battle. Each whisker grown allows us to embrace our hair, which many cancer patients lose during treatment.

More information on No-Shave November can be found at:
https://no-shave.org/

More information on the Melanoma Research Foundation can be found here:

Home

More information on the Prostate Cancer Foundation can be found here:

Homepage

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy four years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.

 

For Immediate Release
October 22, 2020
Contact: Tess Badenhausen
(732) 201-4133

NCOIL TO DEVELOP BUSINESS LIABILITY PROTECTION MODEL ACT
Discussions to Start at NCOIL Annual Meeting in December; Property & Casualty Insurance Committee Will Analyze Efforts States Have Taken to Protect Conscientious Businesses from COVID-19 Litigation

Manasquan, NJ – At the upcoming NCOIL Annual Meeting in Tampa, FL from December 9th–12th, the organization will begin discussing the development of an NCOIL Business Liability Protection Model Act (Model). The Model will be sponsored by Kentucky Representative Bart
Rowland, Chair of the NCOIL Property & Casualty Insurance Committee, and co-sponsored by Indiana Representative Matt Lehman, NCOIL President.

The Model will be placed before the Property & Casualty Insurance Committee and introductory draft language will be included in the 30-day materials for the Annual Meeting which will be distributed and posted on the NCOIL website on November 10th.

Rep. Rowland said, “I am proud to sponsor this Model for states to consider. Unfortunately, the country will be living with this virus for quite some time. However, conscientious businesses still must be able to function in this era of our ‘new normal’ without the cloud of potential litigation hanging over their heads. Of course, if a business acts in a reckless or willful manner, liability can attach, but the businesses who want to re-open in a safe manner should be provided a certain level of immunity from COVID-related lawsuits.”

Various states, including but not limited to Idaho, Iowa, Michigan, North Carolina, Oklahoma, Utah, Wyoming, Louisiana and Kansas have already adopted state legislation providing businesses with some type of limited civil liability immunity from defendants who are seeking damages related to contraction of COVID-19 at the premises in question.

“I applaud Representative Rowland for introducing this measure and I am proud to serve as cosponsor,” said Rep. Lehman. “The economy simply cannot function if businesses can’t get back to the everyday service of providing a product or service to consumers. Having a law in place that would provide a certain level of immunity to responsible businesses will encourage them to re-open, and protect them and their insurers from any unnecessary litigation.”

NCOIL CEO, Commissioner Tom Considine, stated, “We at NCOIL are proud to continue developing model legislation to offer assistance to states as they adapt during these challenging times. With this model, we’re really trying to prevent frivolous lawsuits against businesses that operate using the proper standard of care, and avoid insurance policies having to pay for something that ultimately could be impossible for a litigant to prove in certain instances. We’ll take a look at the legislation that has already been enacted in several states and go from there.”

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy-five years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.

 

For Immediate Release
October 19, 2020
Contact: Tess Badenhausen
(732) 201-4133

NCOIL CONCLUDES VIRTUAL DC FLY-IN TO EDUCATE MEMBERS OF CONGRESS ABOUT THE IMPORTANCE OF STATE-BASED INSURANCE REGULATION
Fifth Consecutive Fly-in – First Time Using Virtual Format; National Cross Section of State Legislators Met with More Than 50 Senators, Representatives, Committee Staff and Member Staff to Further Education Process

Manasquan, NJ – On October 15th, a bi-partisan group of NCOIL legislators from State Senates and State Houses of Representatives around the country participated in Zoom meetings and phone calls to educate Members of Congress and their staffs about the vital importance of state-based regulation of insurance and its success for more than 70 years. This was NCOIL’s fifth-consecutive DC fly-in – the first using a virtual format.

Participating legislators included IN Rep. Matt Lehman, NCOIL President; CA Asm. Ken Cooley, NCOIL Vice President; NY Asm. Kevin Cahill, NCOIL Treasurer; KY Rep. Joe Fischer, NCOIL Secretary; IN Sen. Travis Holdman, NCOIL Immediate Past President; AR Sen. Jason Rapert, NCOIL Immediate Past President; KY Rep. Bart Rowland, Chair of the NCOIL Property & Casualty Insurance Committee; LA Rep. Edmond Jordan, Chair of the NCOIL Financial Services & Multi-Lines Issues Committee; NC Sen. Vickie Sawyer, Vice Chair of the NCOIL Property & Casualty Insurance Committee; MN Sen. Paul Utke, Vice Chair of the NCOIL Workers’ Compensation Insurance Committee; NY Asw. Pam Hunter, Chair of the
NCOIL Health Insurance & Long Term Care Issues Committee; OH Sen. Bob Hackett, Chair of the NCOIL Joint State-Federal Relations & International Insurance Issues Committee; AZ Sen. David Livingston, Chair of the NCOIL Articles of Organization & Bylaws Revision Committee;
and TX Rep. Tom Oliverson, M.D., Chair of the NCOIL Workers’ Compensation Insurance Committee.

They, together with NCOIL CEO Commissioner Tom Considine and staff, participated in more than 60 meetings with Senators, Congressman, and committee and congressional staff, including significant numbers of both the House Financial Services Committee and Senate Banking Committee, to highlight the need to protect the state-based system of insurance regulation.

Meetings included more than 40 meetings overall and numerous Member meetings including Rep. Maxine Waters, Chair of the House Financial Service Committee, and senior staff to Senate Majority Leader Mitch McConnell.

“Members of Congress and their staff need to remember the importance of state-based regulation of insurance to their states and the country” said IN Rep. Matt Lehman, NCOIL President. “During these unprecedented times, the efforts of NCOIL legislators to educate our federal colleagues and have a continuous dialogue is more important than ever before.”

Legislators discussed protection of the state-based regulation of insurance; pandemic business interruption coverage issues; the Prohibit Auto Insurance Discrimination (PAID) Act, which would insert the federal government into insurance rating by prohibiting private passenger automobile insurers from using certain underwriting factors to determine insurance rates and eligibility; the need for a long-term reauthorization and modernization of the National Flood Insurance Program; amending the Employee Retirement Income Security Act of 1975 (ERISA) to add a statutory waiver provision so that states could pilot health insurance reforms and also so the protections set forth in state balance billing laws apply to all health insurance plans – including self-insured plans; and maintaining the recent expansion and utilization of telemedicine.

“This year has been challenging for everyone, but NCOIL has remained committed to ensuring its voice is heard on protecting the state-based the state-based system of insurance regulation and other important issues. Switching to a virtual format enabled us, for the fifth year in a row, to have a successful and beneficial educational fly-in where state legislators and their federal colleagues could discuss these issues of mutual issues. State legislators have worked to affirm the state-based system of insurance that promotes growth and solvency in the market while protecting consumers. This approach has worked for nearly three quarters of a century since the passage of McCarran-Ferguson Act” said NCOIL CEO Tom Considine, former NJ Banking and Insurance Commissioner. “This year we had a record high of participating legislators and they all deserve praise for remaining committed to NCOIL during this unprecedented year. Our meetings with Members of Congress and staff were once again extremely productive and our vigilant education efforts are paying dividends in terms of the recognition of the success of the state-based system from our federal counterparts.”

For the four previous years, NCOIL hosted an Education Fly-In where more than a half dozen NCOIL legislators traveled to Washington DC and participated in more than 50 meetings to educate Members of Congress and their staff about the well-established state-based regulation of insurance in the United States. This year represents the highest number of participating legislators.

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy-five years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.

For Immediate Release
October 5, 2020
Contact: Cmsr. Tom Considine, NCOIL CEO
(732) 201-4133

NCOIL ADOPTS SHORT TERM LIMITED DURATION INSURANCE MODEL ACT
Provides Framework for States that Permit Sale of Short-Term Plans; Based on Indiana Law Enacted in 2019

Manasquan, NJ – At the NCOIL “Summer” Meeting in Alexandria, VA on September 26, the organization adopted the NCOIL Short Term Limited Duration Insurance Model Act (Model) sponsored by IN Representative Martin Carbaugh. The measure passed on a voice vote by both the NCOIL Health Insurance & Long Term Care Issues Committee and NCOIL Executive Committee.

Short-term limited-duration insurance (STLDI) is a type of health insurance that provides coverage to policyholders for a period of as little as a month to as long as three years. This type of coverage is exempt from the definition of individual health insurance coverage under the Patient Protection and Affordable Care Act (PPACA) and is therefore not subject to the PPACA provisions that apply to the individual market. States regulate STLDI in varying ways.

The Model was introduced at the NCOIL 2019 Summer Meeting in Newport Beach, California and is based on Indiana HB 1631 which was also sponsored by Rep. Carbaugh and signed into law in 2019. The Model provides a framework for those states that permit the sale of STLDI. Importantly, the Model includes a drafting note that makes clear that states are not required to offer STLDI, and notes that “for states that choose to offer such plans, this Model is intended to serve as a framework that can be adjusted accordingly to meet each state’s needs.”

Rep. Carbaugh said, “Thank you to everyone who worked on this Model. When comparing the first draft of the Model to the version that was adopted, it is clear that we made sure to hear from those with differing views on short-term plans and make necessary changes. I am a strong supporter of short-term plans and firmly believe that they can help people meet their healthcare needs. Immediately after sponsoring similar legislation in Indiana, I proposed to develop this Model at NCOIL knowing that it was the perfect forum to provide states guidance who are looking to foster a short-term plan marketplace.”

During the drafting discussions, NCOIL legislators and staff heard from a wide array of interested parties including Jim Parker, Senior Advisor to the Secretary of Health and Human Services (HHS) for Health Reform; Jan Dubauskas, VP, Senior Counsel at Health Insurance Innovations (HII); Jeff Smedsrud, President of Pivot Health; Michelle Lilienfeld, Sr. Attorney at the National Health Law Program (NHLP); The Honorable Glen Mulready, Commissioner of the Oklahoma Department of Insurance; Brian Blase, President & CEO of Blase Policy Strategies; the National Association of Insurance and Financial Advisors (NAIFA); the American Medical Association (AMA); the Health Benefits Institute; and the BlueCross BlueShield Association.

“This Model is a great example of how NCOIL can examine an issue and develop policy in a fair and efficient manner,” said NY Assemblywoman Pam Hunter, Chair of the NCOIL Health Committee. “Opinions differ on the value of short-term plans, but nonetheless the Model represents a solid framework for states to utilize when offering such plans.”

“It is great to see that NCOIL is still being productive and offering states guidance in the form of model legislation even during these unprecedented times”, said IN Representative Matt Lehman, NCOIL President. “I am also proud to see my colleague and fellow Hoosier guide this Model through towards final adoption. We’ve seen positive results in Indiana following enactment of our short-term plan law, and I am confident that the states that choose to adopt the Model will see the same.”

The purpose of the Model is to establish standards for the regulation of short-term plans that may be sold in a State.

Highlights of the Model include requiring that a short-term plan have an annual limit of at least two million dollars ($2,000,000) and requiring that short-term plans provide coverage for ambulatory patient services, hospitalization, emergency services, and laboratory services.

The Model also requires that an insurer that issues a short-term plan to disclose to an applicant, in bold, 12 point type: that the short term insurance plan is not required to include coverage for all ten (10) of the essential health benefits required under the PPACA and specify the essential health benefits where no coverage is offered; that the short term insurance plan does not necessarily provide the full coverage that is required under PPACA; and that the full coverage required by the PPACA may be secured during the next PPACA annual open enrollment, which typically commences on November 1 and can be found at https://www.healthcare.gov/quickguide/dates-and-deadlines/. An insurer is also required to obtain the signature of an applicant to whom those disclosures are made.

NCOIL CEO, Commissioner Tom Considine, stated, “Thank you both to Rep. Carbaugh for sponsoring this Model and to Chairwoman Hunter for holding productive hearings that resulted in significant changes, and thank you also to the Committee for deliberating on the Model in a careful but efficient manner. I think short-term plans can really provide help to consumers, particularly when Exchange programs may be unaffordable. For example, in instances where a consumer is close to Medicare age and wants to put as much money as possible into their business, a short-term plan can be a great, cost-effective option that still provides robust coverage.”

A fully copy of the Model is below

National Council of Insurance Legislators (NCOIL)

Short Term Limited Duration Insurance Model Act

*Sponsored by Rep. Martin Carbaugh (IN)
*Adopted by the NCOIL Health Insurance & Long Term Care Issues Committee and NCOIL Executive Committee on September 26, 2020.

Table of Contents

Section 1. Title
Section 2. Purpose
Section 3. Applicability
Section 4. Definitions
Section 5. Renewal and Underwriting
Section 6. Coverage Requirements
Section 7. Network Based Plan Requirements
Section 8. Disclosure Requirements
Section 9. Tiering/Rating
Section 10. Discounts/Rebates/Out-of-Pocket Payment Modifications
Section 11. Rescission
Section 12. Rules
Section 13. Effective Date

Section 1. Title

This Act shall be known as the “[State] Short Term Limited Duration Insurance Model Act.”

Section 2. Purpose

The purpose of this Act is to establish standards for the regulation of short term limited duration insurance plans that may be sold in [State].

Drafting Note: States are not required to offer short term limited duration insurance plans. For states that choose to offer such plans, this Model is intended to serve as a framework that can be adjusted accordingly to meet each state’s needs.

Section 3. Applicability

This Act shall apply to short term insurance plans delivered or issued for delivery to residents of this state, regardless of the situs of the contract or policy; however, nothing in this Section shall invalidate a plan validly delivered in another state.

Section 4. Definitions

For purposes of this Act:

(a) “Covered Individual” means an individual entitled to coverage under a short term insurance plan

(b) “PPACA” means the federal Patient Protection and Affordable Care Act (P.L. 111-148), as amended by the federal Health Care and Education Reconciliation Act of 2010 (P.L. 111-152)

(c) “Network based plan” means a type of health plan that contracts with healthcare providers to create a network of participating providers to provide healthcare services at a discounted cost to covered persons.

(d) “Short Term Insurance Plan” means a policy of health insurance that:

(1) may be renewed for the greater of:

(i) thirty-six (36) months; or

(ii) the maximum period permitted under federal law;

(2) has a term of not more than three hundred sixty-four (364) days; and

(3) has an annual limit of at least two million dollars ($2,000,000).

Section 5. Renewal and Underwriting

(a) An insurer may require an applicant for coverage under a short term insurance plan to specify, before issuance of the short term insurance plan, the number of renewals the applicant elects.

(b) After issuance of a short term insurance plan, the insurer may not require underwriting of the short term insurance plan until:

(1) all renewal periods elected under subsection (a) have ended; and

(2) the covered individual enrolls in a new short term insurance plan beyond the periods described in subdivision (1).

Section 6. Coverage Requirements

A short term insurance plan must include coverage for the following:

(1) Ambulatory patient services;

(2) Hospitalization;

(3) Emergency services; and

(4) Laboratory services

Section 7. Network Based Plan Requirements

(a) This section applies to an insurer that issues a short term insurance plan and undertakes a network based plan to render health care services to covered individuals under the short term insurance plan.

(b) An insurer described in subsection (a) shall ensure that the network based plan meets the following requirements:

(1) The network based plan includes essential community providers in accordance with PPACA.

(2) The network based plan is sufficient in number and types of providers (other than mental health and substance abuse treatment providers) to assure covered individuals’ access to all health care services without unreasonable delay.

(3) The network based plan is consistent with the network adequacy requirements that:

(i) apply to qualified health plan issuers under 45 C.F.R. § 156.230(a) and 45 C.F.R. § 156.230(b); and

(ii) are consistent with subdivisions (1) and (2).

Section 8. Disclosure Requirements

(a) An insurer that issues a short term insurance plan shall disclose to an applicant, in bold, 12 point type, the following:

(1) That the short term insurance plan is not required to include coverage for all ten (10) of the essential health benefits required under the PPACA and specify the essential health benefits where no coverage is offered.

(2) That the short term insurance plan does not necessarily provide the full coverage that is required under PPACA.

(3) That the full coverage required by the PPACA may be secured during the next PPACA annual open enrollment, which typically commences on November 1 and can be found at https://www.healthcare.gov/quick-guide/dates-and-deadlines/

(b) An insurer shall obtain the signature of an applicant to whom the disclosures required by subsection (a) are made.

Section 9. Tiering/Rating

An insurer shall not, as a condition of enrollment or continued enrollment in a short term insurance plan, require an individual to pay a premium or contribution greater than the premium or contribution for a similarly situated individual enrolled in the short term insurance plan on the basis of a health status related factor in relation to the individual or a dependent of the individual.

Section 10. Discounts/Rebates/Out-of-Pocket Payment Modifications

This Act does not prevent an insurer from establishing a premium discount, a rebate, or out-ofpocket payment modifications in return for adherence to programs of health promotion and disease prevention.

Section 11. Rescission

An insurer that issues a short term insurance plan shall not rescind such plan or coverage with respect to an enrollee once the enrollee is covered under such plan involved, except for an act or practice that constitutes fraud or intentional misrepresentation of material fact consistent with the requirements in Public Health Service Act § 2712 (42 U.S.C. § 300gg-12) and 45 C.F.R. § 147.128 or their successors.

Section 12. Rules

The Insurance Commissioner may adopt rules regulating short term limited duration plans that are consistent with this Act.

Section 13. Effective Date

This Act shall take effect [_____].

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy-five years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.

 

For Immediate Release
October 1, 2020
Contact: Tom Considine
(732) 201-4133

NCOIL CONCLUDES SUCCESSFUL HYBRID 2020 “SUMMER” MEETING IN ALEXANDRIA
Three New Model Laws Adopted, Continued Timely Policy Discussion

Manasquan, NJ – The National Council of Insurance Legislators (NCOIL) concluded a successful 2020 “Summer” Meeting at the Hilton Alexandria Old Town in Alexandria, Virginia. This meeting was the first ever hybrid meeting – allowing both in-person and virtual participation. There were 219 total registered attendees – 91 in-person and 128 virtual – consisting of 30 legislators from 16 states, one first-time legislator, 5 Insurance Commissioners (or equivalent), and 9 insurance departments represented. The seven policy committees all met, as well as the Special Committee on Natural Disaster Recovery.

NCOIL President Matt Lehman (Rep. – IN) stated, “I am very pleased with the high attendance of both in-person and virtual participants, all things considered. Although different, this meeting was as successful as any other NCOIL meeting. Thank you to everyone for their continued dedication to NCOIL.”

Participants at the Welcome Breakfast were greeted by VA Insurance Commissioner Scott White, followed by remarks from Steve Livengood – Director of Public Programs and Chief Guide at the Capitol Historical Society. Additionally, during the all-attendee breakfast, President Lehman announced the creation of a Special Committee on Race and Insurance Underwriting to be chaired by NCOIL Past President Neil Breslin (Sen. – NY). Frank Donnatelli – who served in various positions in the Reagan administration including Assistant to the President for Political and Intergovernmental Affairs Deputy Assistant to the President for Public Liaison – delivered the Keynote address during the luncheon.

The agenda was highlighted by the adoption of four NCOIL Model Laws – the NCOIL Private Primary Residential Flood Insurance Model Act by the Special Committee on Natural Disaster Recovery, sponsored by NC Sen. Vickie Sawyer and FL Rep. David Santiago; the NCOIL Model Act Concerning Statutory Thresholds for Settlements Involving Minors by the Financial Services & Multi-Lines Issues Committee, sponsored by TX Rep. Tom Oliverson, M.D. and KY Rep. Joe Fischer – NCOIL Secretary; and the NCOIL Short Term Limited Duration Insurance Model Act by the Health Insurance & Long-Term Care Issues Committee, sponsored by IN Rep. Martin Carbaugh.

There were two fascinating and timely general sessions: “COVID-19: Testing, Treatment, and Vaccination”; and “Future Pandemics: Approaches to Dealing with Business Interruptions”.

“I was very pleased to moderate the general session on COVID-19 testing, treatment and vaccination developments,” said Rep. Oliverson, Chair of the NCOIL Workers’ Compensation Insurance Committee. “It was very beneficial to hear the latest on where we are at in terms of getting a vaccine ready for widespread distribution, as well as what has and hasn’t worked best in testing for and treating the virus.”

“Business interruption coverage has been one of the most important issues facing the economy throughout the past several months,” said MN Sen. Paul Utke – Vice Chair of the NCOIL Workers’ Compensation Insurance Committee and moderator of the business interruption general session. “There is still a lot of work to be done to ensure that both consumers and the industry are better protected in any future pandemics, but the general session made clear that everyone is working tirelessly to develop solutions.”

“Thank you to Commissioner White for being a wonderful host to us in Old Town,” NCOIL CEO, Commissioner Tom Considine said. “There was a great deal of business we were able to conduct by making this a hybrid conference. Although we are still operating far from normal, NCOIL has remained very active since we last convened in Charlotte for the Spring Meeting. I believe ours was the last in-person national meeting before the COVID shutdown, and I am proud that NCOIL was the first large organization to host a national meeting with significant inperson participation as the nation returns to normal,” he continued.

“I am very happy that I could see so many familiar faces safe and healthy in Alexandria. Hopefully, we will be fully back together in Tampa for the December meeting,” Considine concluded.

The Joint State-Federal Relations met to discuss Europe’s Insurance Regulatory Response to COVID-19 with Matt Brewis, Director of General Insurance and Conduct Specialists at the Financial Conduct Authority (FCA) speaking to the attendees via Zoom from the U.K. The Committee also heard a presentation on “Federal Response to Dynamex: Discussion on U.S. Department of Labor Employee Classification Regulation” by James Paretti, Jr., Shareholder at Littler Mendelson P.C., and Joe Capurro, President of the California Applicants Attorneys Association (CAAA).

The Workers’ Compensation Insurance Committee heard a presentation titled “State of the Line” – An Update on the Status of and Trends in the Workers’ Compensation Insurance Marketplace with Jeff Eddinger, Senior Division Executive of Regulatory Business Management for the National Council on Compensation Insurance (NCCI). Dr. Richard Victor, Sedgwick Fellow at the Sedgwick Institute, gave a presentation titled “Scenarios for the 2030s: Threats and Opportunities for Workers’ Compensation Systems.”

The Committee also received an update on State COVID-19 Workers’ Compensation Presumption Executive Orders/Statutes/Regulations from Jason Marcus, Legislative Chair for CAAA; Erin Collins, Vice President of State Affairs for the National Association of Mutual Insurance Companies (NAMIC); and Frank O’Brien, Vice President of State Government Relations for the American Property Casualty Insurance Association (APCIA).

The NCOIL-NAIC Dialogue consisted of an update on State Adoption of Amended NAIC Credit for Reinsurance Models, a discussion on NAIC’s Casualty Actuarial and Statistical Task Force (CASTF), a discussion on NAIC Climate and Resiliency (EX) Task Force, a discussion on the NAIC’s position on pandemic business interruption issues and the NAIC’s business interruption COVID-19 data call, and a discussion on proposed changes to SSAP No. 71.

In addition to the adoption of the NCOIL Model Act Concerning Statutory Thresholds for Settlements Involving Minors, the Financial Services & Multi-Lines Issues Committee discussed the introduction of the NCOIL Insurer Division Model Act, sponsored by CT Sen. Matt Lesser.

The Life Insurance & Financial Planning Committee heard a presentation from Kweilin Ellingrud, Leader of Life and Annuities Practice in North America & Senior Partner at McKinsey & Company on “COVID-19 and the Insurance Industry – Not Just a P&C Issue”. The Committee also heard an educational presentation on life insurance settlements.

In addition to the adoption of the NCOIL Short Term Limited Duration Insurance Model Act, the Health Insurance & Long-Term Care Issues Committee discussed the introduction of the NCOIL Telemedicine Authorization and Reimbursement Model Act, sponsored by NY Asw. Pam Hunter, Chair of the Committee. The Committee continued discussion on the NCOIL Transparency in Dental Benefits Contracting Model Act, sponsored by AR Rep. Deborah Ferguson, Vice Chair of the Committee, and ND Rep. George Keiser; and the NCOIL Vision Care Services Model Act, sponsored by OH Sen. Bob Hackett.

Committee minutes will be posted within the next week at www.ncoil.org. Discussions on model laws will continue during the 2020 Annual Meeting in Tampa, Florida, and possible interim committee calls beforehand. The NCOIL Annual Meeting will take place from December 9th – 12th.

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy-five years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.

 

For Immediate Release
September 26, 2020
Contact: Tom Considine
(732) 201-4133

NCOIL ADOPTS MODEL ACT CONCERNING STATUTORY THRESHOLDS FOR SETTLEMENTS INVOLVING MINORS
Allows for More Efficient and Swifter Process in Minor Settlements

Manasquan, NJ – During the 2020 NCOIL “Summer” Meeting in Alexandria, VA, the organization adopted the NCOIL Model Act Concerning Statutory Thresholds for Settlement Involving Minors (Minors Settlement Model), sponsored by Kentucky Representative Joe Fischer, NCOIL Secretary, and Texas Representative Tom Oliverson, M.D. The measure passed on a voice vote by both the NCOIL Financial Services and Multi-Lines Issues Committee and the NCOIL Executive Committee.

The Minors Settlement Model was introduced at the NCOIL 2020 Spring Meeting in Charlotte, North Carolina. The Model would apply mostly to situations where minimal amounts are involved, and the parties engaged want to settle without incurring additional costs for going into court and obtaining approval. It is similar to many laws in states that allow for settling small estates through affidavits. There are certain security measures in place to ensure that the settlement would be preserved for the minor.

NCOIL Secretary Joe Fischer (Rep. – KY) stated, “The objective of the Model is to save costs associated with settling small claims in order to preserve the minor’s assets. Thank you to the Committee and interested parties for coming forward with an interest to make the process more efficient and help protect settlement funds.”

Dr. Tom Oliverson (Rep. -TX) said, “I agree with Rep. Fischer that this Model creates more efficiencies in minor settlements. By settling through an affidavit, the Model would allow both parties in the matter to settle more quickly and allow the people who are injured to get their money faster. The insurance companies can then resolve the claims promptly and all parties can save costs.”

During the drafting discussion, NCOIL legislators and staff heard from interested parties including National Association of Mutual Insurance Companies (NAMIC), the American Property Casualty Insurance Association (APCIA), and Shelter Insurance.

The purpose of the Model is “to set forth standards and procedures for settling claims involving minors.”

Highlights of the Model include setting forth a procedure that allows a person having legal custody of a minor to enter into a settlement agreement with a person against whom the minor has a claim if: a [conservator or guardian ad litem] has not been appointed for a minor; the total amount of the claim, not including reimbursement of medical expenses, liens, reasonable attorney fees and costs of suit, is $25,000 or less if paid in cash or if paid by the purchase of a premium for an annuity; the moneys paid under the settlement agreement will be paid pursuant to certain guidelines; and the person entering into the settlement agreement on behalf of the minor completes an affidavit or verified statement that attests that the person has made a reasonable inquiry and that: to the best of the person’s knowledge, the minor will be fully compensated by the settlement, or, there is no practical way to obtain additional amounts from the party entering into the settlement agreement with the minor.

If a settlement agreement is entered into in compliance with the provisions of the Model, the signature of the person entering into the settlement agreement on behalf of the minor is binding on the minor without the need for further court approval or review and has the same force and effect as if the minor were a competent adult entering into the settlement agreement.

The Model also sets forth guidelines as to how the moneys payable under the settlement agreement must be paid, and states that the moneys in a minor’s savings account, trust account or trust subaccount may not be withdrawn, removed, paid out or transferred to any person, including the minor, except pursuant to court order, upon the minor’s attainment of 18 years of age, or upon the minor’s death.

NCOIL CEO, Commissioner Tom Considine, stated, “Thanks to the Committee, and a special thanks to Rep. Fischer and Rep. Oliverson for sponsoring this and getting the Model to a good place in such a timely manner to be ready to send to the states. The need for this Model caught me a bit by surprise because I thought that parents & guardians always had the right to settle disputes for their children without going to court. Little did I know it’s not always that simple.”

A full copy of the model is below.

 

National Council of Insurance Legislators (NCOIL)

Model Act Concerning Statutory Thresholds for Settlements Involving Minors

*Sponsored by Rep. Joe Fischer (KY) and Rep. Tom Oliverson, M.D. (TX)
*Adopted by the Financial Services & Multi-Lines Issues Committee on September 26th, 2020. Adopted by the Executive Committee on September 26, 2020.

Table of Contents

Section 1. Title
Section 2. Purpose
Section 3. Procedures for Settling Claims Involving Minors
Section 4. Effective Date

Section 1. Title

This Act shall be known and cited as the “[State] Statutory Thresholds for Settlements Involving Minors Act.”

Section 2. Purpose

The purpose of this Act is to set forth standards and procedures for settling claims involving minors.

Section 3. Procedures for Settling Claims Involving Minors

(1) A person having legal custody of a minor may enter into a settlement agreement with a person against whom the minor has a claim if:

(a) A [conservator or guardian ad litem] has not been appointed for a minor;

(b) The total amount of the claim, not including reimbursement of medical expenses, liens, reasonable attorney fees and costs of suit, is $25,000 or less if paid in cash or if paid by the purchase of a premium for an annuity;

(c) The moneys paid under the settlement agreement will be paid as set forth in subsections (3) and (4) of this section; and

(d) The person entering into the settlement agreement on behalf of the minor completes an affidavit or verified statement that attests that the person has made a reasonable inquiry and that:

(i) To the best of the person’s knowledge, the minor will be fully compensated by the settlement; or

(ii) There is no practical way to obtain additional amounts from the party entering into the settlement agreement with the minor.

(2) The attorney representing the person entering into the settlement agreement on behalf of the minor, if any, shall maintain the affidavit or verified statement completed under subsection (1)(d) of this section in the attorney’s file for two years after the minor attains the age of 21 years.

(3) The moneys payable under the settlement agreement must be paid as follows:

(a) If the minor or person entering into the settlement agreement on behalf of the minor is represented by an attorney and the settlement is paid in cash, by draft, by direct deposit into the attorney’s trust account maintained pursuant to rules of professional conduct adopted under [State Attorney Trust Accounting Rules] to be held for the benefit of the minor. The attorney shall deposit the moneys received on behalf of the minor directly into a federally insured savings account that earns interest in the sole name of the minor, and provide notice of the deposit to the minor and the person entering into the settlement agreement on behalf of the minor. Notice shall be delivered by personal service or first-class mail.

(b) If the minor or person entering into the settlement agreement on behalf of the minor is not represented by an attorney and the settlement is paid in cash or by draft, directly into a federally insured savings account that earns interest in the sole name of the minor. Notice of the deposit to the minor shall be delivered by personal service or first-class mail. The minor or person entering into the settlement agreement on behalf of the minor shall open the federally insured savings account and provide the person or entity with whom the minor has settled the claim with information sufficient to complete an electronic transfer of settlement funds within 10 business days of the settlement;

(c) If paid by purchase of an annuity, by direct payment to the provider of the annuity with the minor designated as the sole beneficiary of the annuity.

(d) If the minor is a [ward of the state] and the settlement is paid in cash, directly into a trust account, or subaccount of a trust account, established by the [department responsible for wards of the state, or similar state mechanism] for the purpose of receiving moneys  payable to the ward under the settlement agreement and that earns interest for the benefit of the ward.

(4) The moneys in the minor’s savings account, trust account or trust subaccount established under subsection (3) of this section may not be withdrawn, removed, paid out or transferred to any person, including the minor, except as follows:

(a) Pursuant to court order;

(b) Upon the minor’s attainment of 18 years of age; or

(c) Upon the minor’s death.

(5) If a settlement agreement is entered into in compliance with subsection (1) of this section, the signature of the person entering into the settlement agreement on behalf of the minor is binding on the minor without the need for further court approval or review and has the same force and effect as if the minor were a competent adult entering into the settlement agreement.

(6) A person acting in good faith on behalf of a minor under this section is not liable to the minor for the moneys paid in settlement or for any other claim arising out of the settlement.

(7) Any person or entity against whom a minor has a claim that settles the claim with a minor in good faith under this section shall not be liable to the minor for any claims arising from the settlement of the claim.

Section 4. Effective Date

This Act shall take effect [xxx days] following enactment.

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy-five years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.

For Immediate Release
September 25, 2020
Contact: Cmsr. Tom Considine
(732) 201-4133

NCOIL ANNOUNCES CREATION OF SPECIAL COMMITTEE ON RACE ININSURANCE UNDERWRITING
Committee to be Chaired by NY Senator Neil Breslin – former NCOIL President; Will Focus on Defining “Proxy Discrimination” and Discussing Use of Certain Rating Factors

Manasquan, NJ – Indiana Representative Matt Lehman, NCOIL President, announced the creation of an NCOIL Special Committee on Race in Insurance Underwriting today during the 2020 NCOIL “Summer” Meeting in Alexandria, Virginia. New York Senator Neil Breslin, former NCOIL President, will Chair the Committee.

Rep. Lehman said, “After careful deliberations with my fellow officers, we all determined that NCOIL needs to take a more active role in framing the discussions around race and insurance underwriting that can have a huge impact on both policyholders and the insurance industry as a whole. I am pleased to say that each of my fellow officers has agreed to serve on the Committee. By no means have we sat idly by on the sidelines as society has confronted these issues, but we all agreed that as an organization comprised of state insurance legislators who are charged with developing and making law, NCOIL’s voice needs to be heard.”

Senator Breslin stated, “I am honored to Chair this Committee. The insurance industry has been among those industries that has taken steps to review and, in some instances, change, certain established ways of doing business in an effort to address systemic bias and racism. The thoughts and views of state insurance legislators are extremely valuable as these important decisions occur which is why forming this Committee is so vital.

“The Committee will study race-related issues in insurance underwriting and work to maintain the proper constitutional jurisdiction of State legislatures over the significant public policy issues related to regulating the business of insurance,” continued Breslin. “We want to make sure that any decisions made on such issues are made with input by state insurance legislators – those with the proper authority to make such decision as set forth in the McCarran-Ferguson Act seventy-five years ago.”

“I commend Senator Breslin for his leadership in Chairing the Committee,” said Rep. Lehman. “Neil is someone who is greatly respected not only at NCOIL, but by the constituents he serves and the insurance industry. As Chair of the Senate Insurance Committee in one of the most diverse states in our country, he is certainly the right man for the job.”

The Committee will hold hearings at the NCOIL Annual Meeting in Tampa, Florida – still scheduled for December 9-12. The Committee is tentatively charged with: taking testimony, discussing, and defining the term “proxy discrimination” – an undefined term that has been used by many when discussing insurance rating, and has even been included in regulatory-related documents; and discussing the wisdom of certain rating factors being used in insurance underwriting, such as zip code, and level of education.

“I look forward to hearing from experts on these important issues,” said Rep. Lehman. “We’re going to make sure that the hearings are guided by actuarial and data-driven presentations, not by opinion testimony from non-experts.”

NCOIL CEO, Commissioner Tom Considine said, “Representative Lehman, his fellow officers, and Senator Breslin, have really shown tremendous leadership in forming this Committee and asserting NCOIL in the important conversations that have been taking place around race in insurance underwriting. Forming this Committee shows commitment to reviewing the insurance legislative and regulatory system in order to determine whether current practices exist in our system that disadvantage minorities because of their status, while recognizing that changes to the system, including determinations regarding rating variables, must ultimately be made in a legislative forum.”

“The United States’ state-based regulatory system has effectively protected consumers and helped create the largest, most competitive and innovative insurance market in the world. As both a former state insurance commissioner and now as CEO of NCOIL, I know firsthand from two perspectives that now is certainly not the time for Congress to wade into insurance underwriting. Our state-based system is a model to be held up and supported by the federal government. NCOIL will continue to be vigilant in guarding against any efforts to encroach upon said system,” concluded Considine.

Any legislator who has been active in NCOIL is eligible to join the Committee.

Legislators interested in joining the Committee can reach out to [email protected].

More information on the Committee’s hearings will be posted on www.ncoil.org when announced.

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy-five years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.

 

For Immediate Release
September 24, 2020
Contact: Cmsr. Tom Considine, NCOIL CEO
(732) 201-4133

NCOIL ADOPTS PRIVATE PRIMARY RESIDENTIAL FLOOD INSURANCE MODEL ACT
Provides Protection of Lives and Property from the Peril of Flood and Encourages Expansion of Private Flood Insurance Market

Manasquan, NJ – At the NCOIL “Summer” Meeting in Alexandria, VA, the organization adopted the NCOIL Private Primary Residential Flood Insurance Model Act sponsored by FL Representative David Santiago and NC Senator Vickie Sawyer. The measure passed on a voice vote by the NCOIL Special Committee on Natural Disaster Recovery and is expected to be affirmed by the Executive Committee when it convenes in two days.

NCOIL President Matt Lehman (Rep. – IN) stated, “This Model is extremely critical and timely as the nation is amid hurricane season. As of September 14th, just last week, the National Hurricane Center has named 20 storms in just over three months. The Hurricane Center literally just recently ran out of traditional names for storms and had to use the Greek alphabet to name subtropical storm Alpha. With several weeks to go in the 2020 hurricane season, it is our responsibility as state legislators and for those of us insurance agents to make more options available and be transparent with consumers on their financial plan. Many homeowners do not realize that flood insurance is not already part of their policy. Natural disasters cannot be controlled, but there is control over protection for the potential immense destruction and loss.”

The NCOIL Special Committee for Natural Disaster Recovery first met at the 2019 Spring Meeting in Nashville, TN. Over a dozen legislators from 13 states serve on the Committee representing coastal and inland states that have suffered flooding, hurricanes, tornadoes, and wildfires in the past few years. NCOIL 2019 President, LA Senator Dan “Blade” Morrish appointed NC Senator Vickie Sawyer as the Committee Chair during an interim call of the Committee in June 2019. Additionally, during that interim call, the Committee heard from legislators and interested parties on the best course of action regarding the private flood insurance market.

NC Sen. Vickie Sawyer stated, “I greatly appreciate the opportunity to join the NCOIL leadership team and to work with the committee on an issue where I have personally seen such devastating effects in my home state. As an insurance agent, state Senator, and resident of a coastal state, I see all too often that we need solutions to help communities after a natural disaster. I am honored to have been able to chair the committee and sponsor the Private Primary Residential Flood Insurance Model Act.”

The initial drafting discussion for the NCOIL Private Primary Residential Flood Insurance Model began at the 2019 Spring Meeting, previously taking the form of proposed amendments to an existing NCOIL Model Act – the NCOIL State Flood Disaster Mitigation and Relief Model Act. The Committee then decided to develop a standalone Model Act, initially titled the NCOIL Private Flood Insurance Model Act. The Model is based partly on existing Florida legislation that has proven to be very successful in facilitating expansion of the private flood insurance
market.

During the drafting discussions, NCOIL legislators and staff heard from a wide array of interested parties including: Federal Emergency Management Association (FEMA), National Association of Mutual Insurance Companies (NAMIC), American Property Casualty Insurance Association (APCIA), National Association of Realtors (NAR), Lisa Miller & Associates, Independent Insurance Agents and Brokers of America (IIABA), Reinsurance Association of America (RAA), State Farm Insurance Company, United Policyholders (UP), National Association of Insurance Commissioners (NAIC), Farmers Insurance Group, Center for Economic Justice (CEJ), National Association for Professional Insurance Agents (NAPIA), Wholesale and Specialty Insurance Association (WSIA), and others.

The purpose of the Model is “to provide protection of lives and property from the peril of flood,” and is “designed to encourage a robust private primary residential flood insurance market to provide consumer choices and alternatives to the existing National Flood Insurance Program (NFIP).

Highlights of the Model include: a recommendation that states utilize a “use and file” or “file and use” rate filing system for private flood insurance coverage; a requirement that an insurer must attest that the rates are based on actuarial data, methodologies, standards, and guidelines relating to flood that are not excessive, inadequate, or unfairly discriminatory; and a recommendation that states do not impose greater filing requirements for private flood insurance form filings than the State requires for other property lines of insurance.

The Model also requires important disclosures to be made to consumers such as: a requirement that if a consumer currently has no coverage under the NFIP, the consumer must be informed of the existence of the NFIP before placing the consumer application with private flood insurance; and that all consumers, including those that currently have coverage under the NFIP, must be informed that the coverage under the NFIP may be provided at a subsidized rate and that the full-risk rate for flood insurance may apply to the property if the applicant later seeks to reinstate coverage under the program.

The Model also sets forth that a state’s diligent effort law shall not apply to flood coverage under an insurance policy issued by an eligible surplus lines insurer unless and until the Commissioner certifies in a bulletin or order that the admitted private flood insurance market is adequate; and states that writing private flood insurance does not constitute participation in the property insurance market for purposes of determining participation in the state’s residual market program.

NCOIL CEO, Commissioner Tom Considine, stated, “2020 has been a record-breaking year in many distressing ways, hurricanes just one of them. With regard to natural disasters, we know all too well that not enough people are insured when a catastrophic event occurs. I am pleased with the hard work of the Special Committee and the outcome of the NCOIL Private Primary Residential Flood Insurance Model which is the result of much discussion and compromise between several legislators and interested parties.”

A full copy of the model is below.

 

National Council of Insurance Legislators (NCOIL)

Private Primary Residential Flood Insurance Model Act

*Sponsored by Rep. David Santiago (FL) and Sen. Vickie Sawyer (NC)
*Adopted by the NCOIL Special Committee on Natural Disaster Recovery on September 24, 2020. To be considered by the NCOIL Executive Committee on September 26, 2020.

Table of Contents

Section 1. Title
Section 2. Purpose
Section 3. Definitions
Section 4. Rates
Section 5. Forms
Section 6. Duties of Insurer to Provide Regulatory Notice of Intent to Transact Residential Primary Flood Insurance
Section 7. Notice to Consumers
Section 8. Cancellation and Nonrenewal Notice
Section 9. Surplus Lines Placements
Section 10. Other Provisions
Section 11. Rules
Section 12. Effective Date

Section 1. Title

This Act shall be known as the Private Primary Residential Flood Insurance Model Act.

Section 2. Purpose

To provide protection of lives and property from the peril of flood, this legislation is designed to encourage a robust private primary residential flood insurance market to provide consumer choices and alternatives to the existing National Flood Insurance Program (NFIP).

Section 3. Definitions

For purposes of this Act:

(a) “Authorized Insurer” means an insurer that is authorized by the [State entity for regulating insurance] to write insurance under a certificate of authority issued by the [State entity for regulating insurance] to transact insurance in this State.

(b) “National Flood Insurance Program” means the program of flood insurance coverage and floodplain management administered under the National Flood Insurance Act of 1968 (42 U.S.C. 4001 et. seq) and applicable federal regulations promulgated in Title 44 of the Code of Federal
Regulations.

(c) “Primary residential flood insurance” means an insurance policy covering losses from flood to residential property, other than commercial property, written in this State by any insurer authorized to do business that is not written to apply coverage in excess of the coverage provided under another flood insurance policy, whether issued by a private insurer or the National Flood Insurance Program.

Section 4. Rates

(a) Rates for flood insurance coverage established pursuant to this paragraph are not subject to prior approval by the [State entity for regulation of insurance]. An insurer must attest that the rates are based on actuarial data, methodologies, standards, and guidelines relating to flood that are not excessive, inadequate, or unfairly discriminatory. The [State entity for regulation of insurance] may audit an insurer’s flood rates to ensure compliance with State laws and regulations.

(b) An insurer shall file with the [State entity for regulation of insurance] all rates and any change to such rates within 30 days after the effective date. The notice of a rate change must include the name of the insurer and the average statewide percentage change in rates. Actuarial data with regard to such rates for flood coverage must be maintained by the insurer for 2 years after the effective date of such rate change.

Drafting Note: A “use and file” rate filing is used in this section. A State may choose to apply a “file and use” standard instead.

Section 5. Forms

The [State entity for regulating insurance] may require, through the application of the State’s existing regulatory system:

(a) that an insurer file the forms for primary residential flood insurance coverage;

(b) that an authorized insurer may issue an insurance policy, contract, or endorsement; and,

(c) for residential properties required to have flood insurance that are in a Special Flood Hazard Area designated by the Federal Emergency Management Agency, that the coverage at least meets the private flood insurance requirements as specified in 42 U.S.C. § 4012a(b) and applicable federal regulations in document 84 FR 4953, effective July 1, 2019.

Drafting Note: In the interest of facilitating the growth of the private flood market, the intent of this section is to ensure that States do not impose greater filing requirements for private flood insurance form filings than the State requires for other property lines of insurance. Further, States may also wish to consider further streamlining the filing requirements for commercial flood insurance to enhance insurers’ ability to develop private flood policies and endorsements that would provide consumers with choices when compared to the protection provided by the National Flood Insurance Program.

Section 6. Duties of Insurer to Provide Regulatory Notice of Intent to Transact Residential Primary Flood Insurance

(a) Authorized insurers must notify the [State entity for regulating insurance] of plans to sell primary residential flood insurance products in accordance with the State’s rate filing laws but at least 30 days before writing such flood insurance in this State; and

(b) File a plan of operation and financial projections or material revisions to such plan.

Section 7. Notice to Consumers

(a) If a consumer currently has no coverage under the NFIP, before placing the consumer applicant with private flood insurance, the consumer must be informed of the existence of the NFIP.

(b) All consumers covered by subsection 7(a) as well as consumers who currently have coverage under the NFIP must be informed that the coverage under the NFIP may be provided at a subsidized rate and that the full-risk rate for flood insurance may apply to the property if the applicant later seeks to reinstate coverage under the program. The insurance producer, surplus lines broker, or the insurer upon its election or if there is no producer or broker must provide such notice.

(c) This section (7) only applies if the applicant lives in a Special Flood Hazard Area. This section automatically sunsets if federal legislation is enacted allowing the insured to switch between private flood insurance and NFIP coverage without risk of penalty.

Section 8. Cancellation and Nonrenewal Notice

(a) Notice of cancellation or nonrenewal, other than for nonpayment of premium, as allowed by State statute, shall be made and provided in compliance with [applicable State law] but at least 45 days before the cancellation or nonrenewal of private flood insurance coverage to the insured.

(b) Notwithstanding (a) above, notice of cancellation for nonpayment of premium, or fraud or misrepresentation in the application, shall be made and provided in compliance with [applicable State law].

Drafting Note – The notice described must meet the delivery and other requirements established under [insert reference to the provisions of the State code addressing cancellation and nonrenewal notice requirements]. This section is intended for States that have cancellation and nonrenewal notice requirements, for other than nonpayment of premiums, that mandate the delivery of such notices fewer than 45 days before cancellation or nonrenewal of a policy but is not necessary in other States.

Section 9. Surplus Lines Placements

[Applicable State diligent effort law] shall not apply to flood coverage under an insurance policy issued by an eligible surplus lines insurer unless and until the Commissioner certifies in a bulletin or order that the admitted private flood insurance market is adequate.

Drafting Note – States may wish to consider sunsetting this section after a specified period of time.

Section 10. Other Provisions.

(a) [Residual Market Mechanism] Participation. Writing private flood insurance does not constitute participation in the property insurance market for purposes of determining participation in the [insert name of State residual market program] under [insert citations of State law requiring insurers writing property insurance in the State to participate in the residual risk pool].

Drafting Note: Appropriate reference should be made to FAIR plans, wind and beach pools, and related entities.

(b) Filings Open to Inspection. All rates, supplementary rate information, and any supporting information filed under this Act shall be open to public inspection upon disposition, except information marked and accepted by the Commissioner as  confidential, Trade Secret, or proprietary by the insurer or filer in accordance with (statutory reference for confidentiality requirements). Copies may be obtained from the commissioner upon request and upon payment of a reasonable fee.

(c) With respect to the regulation of flood coverage written in this state by authorized insurers, this section supersedes any other provision in the State Insurance Code in the event of a conflict.

(d) An insurer may certify that the insurance policy meets the definition of “private flood insurance,” as specified in 42 U.S.C. § 4012a(b)(7) and applicable federal regulations.

(e) It is the intent of the legislature that nothing in this law is intended to restrict the use of existing filings by an insurer or limit ability of private insurers to provide flood insurance coverage of any type not addressed herein.

Section 11. Rules

The [State entity for regulation of insurance] may adopt rules to implement this law.

Section 12. Effective Date

This Act shall take effect ______________.

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NCOIL is a national legislative organization with the nation’s 50 states as members, represented principally by legislators serving on their states’ insurance and financial institutions committees. NCOIL writes Model Laws in insurance and financial services, works to preserve the State jurisdiction over insurance as established by the McCarran-Ferguson Act seventy-five years ago, and to serve as an educational forum for public policymakers and interested parties. Founded in 1969, NCOIL works to assert the prerogative of legislators in making State policy when it comes to insurance and educate State legislators on current and longstanding insurance issues.