Category(s): Florida - 05/23/2017

Prior to the 2017 legislative session, Florida Chief Financial Officer Jeff Atwater announced that he would be leaving his post when the session ended.  Atwater was approaching the end of his tenure as Chief Financial Officer and was rumored as a potential candidate for future elected positions including Governor and U.S. Senate.  Ultimately, however, Atwater decided to take a Vice President position at Florida Atlantic University.  Governor Rick Scott appoints a successor for the balance of Atwater’s term.

Travis L. Miller, Esq. - RADEY LAW FIRM, (850) 425-6654 , tmiller@radeylaw.com

Category(s): Florida - 05/23/2017

Citizens Property Insurance Corporation (“Citizens”) recently announced they will begin offering two new programs in an effort to mitigate rapidly rising claims costs due to water losses. Citizens will now offer consumers emergency water removal services and add a managed repair contractor program to their claims services.  Citizen notes that the two services are optional and only offered at the time of actual loss, which are limited to those water losses not caused by weather.
 
The optional services would cover losses such as accidental discharge or overflow of water or steam from plumbing, heating, air conditioning, automatic fire-protective sprinkler systems or household appliances.  The services will become available for new business and renewals effective on or after July 1, 2017, for Citizens Homeowners 3 - Special Form (CIT HO-3) and Dwelling Property 3 - Special Form (CIT DP-3) policy types.  The services will be offered when policy holders or their agents call Citizens to report and loss and a representative deems they are eligible to participate.

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 592-5530

Category(s): Florida - 05/23/2017

Recently, the Florida Cabinet State Board of Administration (“SBA”) unanimously approved the 2017-2018 Florida Hurricane Catastrophe Fund (“CAT Fund”) Reimbursement Premium Formula.  The SBA also adopted a proposed rule for Rule 19-8.028, F.A.C., Reimbursement Premium Formula (the “Rule”), which implements the formula.  The formula follows statutory criteria that has been in place since the inception of the CAT Fund.  Two key statutory requirements mandate that the formula must be actuarially sound and must also be developed by a third-party actuary under contract with the SBA.
 
The formula has been considered twice in public proceedings and was recommended for adoption by the CAT Fund Advisory Council during those proceedings.  It was also discussed during a Rule Development Workshop on March 24, 2017, during which no objections were made.  It was slated for another public hearing on May 9, 2017, however, no timely request for a hearing was made.  The Rule will be filed for adoption, as authorized by vote of the SBA Trustees at the April 11, 2017 Cabinet meeting.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 05/23/2017

HB 805, sponsored by Rep. Blaise Ingoglia (R-Spring Hill), recently passed the Florida Legislature.  This bill allows an insurer to transfer a personal lines or commercial residential policy to an affiliated insurer or holding company upon renewal.  Under the measure, insurers may transfer a personal lines residential or commercial residential policy to another authorized insurer that is a member of the same group or owned by the same holding company if the following conditions are met:

•The insurer transferring the policy must be admitted in Florida and other states and must write residential property insurance in multiple states;
•The policy may not include conversion to a surplus lines policy;
•The transfer must results in substantially similar coverage;
•The insurer to which the policy is being transferred must provide the policyholder with notice of the transfer, change in any terms, the renewal premium and the new insurer’s financial rating at least 60 days in advance;
•There can be no discrimination in the selection of the policy being transferred; and
•The Office of Insurance Regulation (“OIR”) must determine that the insurer receiving the policy has the same or better financial strength as the transferring insurer, and OIR approves the transfer.

Governor Rick Scott signed the bill into law on May 9, 2017.  It will take effect on July 1, 2017.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 05/23/2017

The Florida legislature concluded its 2017 legislative session without adopting “assignment of benefits” reforms.  The Florida residential property insurance market has seen an increase in lawsuits brought by third party vendors who have received assignments of policyholders’ one-way rights of attorneys’ fees against their insurers.  Despite substantial testimony from the Office of Insurance Regulation and Citizens Property Insurance Corporation, the legislature did not address the issue this year.

Travis L. Miller, Esq. - RADEY LAW FIRM, (850) 425-6654 , tmiller@radeylaw.com

Category(s): Georgia - 05/23/2017

Senate Bill 219 was signed into law by Governor Deal on May 8th.  SB 219 permits and regulates the operation of self-driving cars on Georgia roads.  The law does not require a driver’s license for the vehicle itself with its automated driving system engaged and clarifies specific accident reporting requirements for autonomous vehicles.  A fully autonomous vehicle may operate on Georgia roads if it is certified by the manufacturer as being in compliance with the applicable federal motor vehicle safety standards and can automatically be safely brought to a stop in the event of failure of the automated driving system.  Until December 31, 2019 autonomous vehicles must be covered by motor vehicle liability insurance coverage equivalent to 250% of the requirement for commercial vehicles (100/300/50).  On and after January 1, 2020, autonomous vehicles must be covered by the minimum commercial limits.  SB 219 is effective on July 1, 2017.

Tony Roehl, Esq. - BAKER HOSTETLER LLP, (404) 256-8419 , troehl@bakerlaw.com

Category(s): Georgia - 05/24/2017

The following are summaries some of the key legislative bills that the Georgia General Assembly adopted in its 2017 legislative regular session that affect the insurance industry.  The 2017 legislative session, which ended on March 30, 2017, was the first year of the state’s two year regular legislative session, and thus bills that did not pass will be carried over to next year’s session.  Unless a passed bill has a specific effective date, passed bills become effective on July 1, 2017.

Firefighters’ Cancer Insurance:  HB 146 requires fire departments to buy and maintain insurance covering fire departments’ members’ cancer related health risks as defined by statute by amending [Title 21] of the Georgia Code. This bill becomes effective in January 1, 2018.  

Regulation of Pharmacy Benefit Managers:  SB 103 and HB 276 amends The Pharmacy Patient Protection Act, Chapter 64 of the Georgia Insurance Code, to provide express authority for the Georgia Insurance Commissioner to adopt regulations governing pharmacy benefit managers, prohibit pharmacy benefit managers from requiring insureds under group or individual health insurance policies to use mail order pharmacies in certain circumstances, and imposing certain prohibitions on pharmacy benefit managers in dealing with insureds, pharmacies and pharmacists.  This bill applies to group or individual health insurance policies issued on or after July 1, 2017.  

Children’s Hearing Aid Insurance Coverage:  SB 206 amends Chapter 24 of the Georgia Insurance Code to create the Hearing Aid Coverage for Children Act, which requires group and individual health insurance policies issued on or after January 1, 2018 to provide coverage for one hearing aid per impaired ear for billed charges not to exceed $3,000 per hearing aid for covered individuals of 18 years of age or younger and one replacement of a hearing aid every 48 months and various other children’s hearing aid coverage requirements.  

Life and Health Insurer Risk-Based Capital Negative Trend Trigger:  HB 74 amends Georgia Insurance Coe Section 33-56-3 to require a life or health insurer to file a risk-based capital report if the insurer’s total adjusted capital is equal to or great than its company action level RBC but less than the product of its authorized control level RBC multiplied by 3, amending the former 2.5 multiplier to conform to the NAIC’s accreditation standards.  

Medical Marijuana Expansion:  SB 16 add six new types of illnesses which can be treated with cannabis oil with a physician’s prescription: Autism, AIDS, Alzheimer’s Disease, Epidermolysis Bullosa, Peripheral Neuropathy, Tourette’s Syndrome.

Vetoed: Expansion of Insurers’ Permissible Payment Means:  The Georgia Governor vetoed HB 174 which would have amended Georgia Insurance Code Section 33-24-43 to expand the means by which insurers may pay insurance policy benefits or covered losses to include wire transfers, cashier’s checks, bank checks and drafts, electronic funds transfers and other forms of electronic payments, general us gift cards without any expiration date, dormancy or non-use fee and any other payment method that the Georgia Insurance Commissioner may approved.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com

Category(s): New Mexico - 05/23/2017

After trying for many years to amend the New Mexico Insurance Code to include the regulation of public adjusters, the Superintendent of Insurance successfully added regulatory authority over public adjusters during the 2017 Legislative Session.  Public adjusters are insurance claim adjusters who are hired by and work for claimants rather than for insurance companies.  Conflict arose in the past when roofing contractors also acted as public adjusters and encouraged extensive roof repairs while assuring homeowners that insurance companies will fully pay for repairs.   While the Insurance Code previously required all adjusters to be licensed, the Office of Superintendent of Insurance only issued licenses to insurance company adjusters and did not regulate public adjusters.  The new law (Senate Bill 88), which will become effective on June 16, 2017, defines public adjusters and specifically prohibits contractors, roofers, plumbers, or anyone else who provides building repairs or products for compensation from serving in the role of adjuster.  This new law establishes requirements for public adjusters to deposit funds received from insureds in escrow or trust accounts.  Furthermore, the new law provides for continuing education requirements and allows the Superintendent of Insurance to review public adjuster reports of insurance fraud.

Gary Kilpatric, Esq. - MONTGOMERY & ANDREWS, P.A., (505) 982-3873

Category(s): Rhode Island - 05/23/2017

The Rhode Island auto body industry continues to challenge the process of setting auto body repair labor rates.  Pursuant to R.I. Gen. Law § 27-29-4.4 and Division of Insurance Regulation 108, each insurer must survey the auto body repair shops annually; however, nothing in the statute “requires an insurer to establish the prevailing rate for each classification of full collision licensed auto body repair facilities based solely on the survey results.” § 27-29-4.4(b).  Recently, several auto body repair shops have filed complaints with the Division of Insurance against multiple insurers challenging the prevailing auto body labor rates each insurer set for 2017.  Additionally, an auto body bill has been submitted in the General Assembly to amend § 27-29-4.4 that would require insurers to execute its labor rate survey under the penalties of perjury.

John J. Partridge, Esq. - PARTRIDGE SNOW & HAHN LLP, (401) 861-8200

Category(s): Tennessee - 05/23/2017

Tennessee Department of Commerce and Insurance Commissioner Julie Mix McPeak has named her longstanding General Counsel, Lorrie Brouse, as Deputy Commissioner of TDCI.  Ms. Brouse, who will continue to serve as General Counsel, succeeds Chlora Lindley-Myers, who left TDCI earlier this year to become Director of the Missouri Department of Insurance, Financial Institutions and Professional Registration.

T. Stephen C. Taylor, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-7758 , staylor@bassberry.com
Robins H. Ledyard, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-6259