CHAPTER 378
SB 500-FN – FINAL VERSION
03/13/08 0827s
16Apr2008… 1291h
06/05/08 2122eba
2008 SESSION
01/10
SENATE BILL 500-FN
AN ACT relative to certain insurance fraud and establishing a task force on employee misclassification.
SPONSORS: Sen. Hassan, Dist 23; Sen. Barnes, Dist 17; Sen. DeVries, Dist 18; Rep. Goley, Hills 8; Rep. Holden, Hills 7
COMMITTEE: Commerce, Labor and Consumer Protection
This bill:
I. Increases the penalties for insurance fraud. This bill also increases the penalty for employers who fail to secure workers’ compensation.
II. Establishes a task force on employee misclassification.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03/13/08 0827s
16Apr2008… 1291h
06/05/08 2122eba
08-2706
01/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eight
AN ACT relative to certain insurance fraud and establishing a task force on employee misclassification.
Be it Enacted by the Senate and House of Representatives in General Court convened:
378:1 New Paragraph; Administrative Services; Duties of the Commissioner. Amend RSA 21-I:13 by inserting after paragraph XIV the following new paragraph:
XV. Maintain a list of persons who have been prohibited from participating in public works projects under RSA 638:20. Such list shall be a public record under RSA 91-A.
378:2 Workers’ Compensation; Liability of Employer Failing to Comply. Amend RSA 281-A:7, VI to read as follows:
VI. Any employer, individual, or corporate officer required to secure payment of compensation under this chapter who purposely, as defined in RSA 626:2, II(a), fails to secure such payment shall be guilty of a [misdemeanor] class B felony.
378:3 Insurance; Claim Forms. Amend RSA 402:82 to read as follows:
402:82 [Warning Notice on] Claim Forms and Applications.
I. All insurance claim forms shall contain a statement that clearly states in substance the following: “Any person who, with a purpose to injure, defraud, or deceive any insurance company, files a statement of claim containing any false, incomplete, or misleading information is subject to prosecution and punishment for insurance fraud, as provided in RSA 638:20.” [However, the lack of such a statement shall not constitute a defense against prosecution under RSA 638:20.]
II. No insurance company or producer shall accept an application for workers’ compensation or property or casualty insurance, unless the application includes:
(a) A written or electronic signature of the producer, unless the transaction does not involve a producer; and
(b) A written or electronic signature of the applicant.
III. The lack of the information required by paragraphs I and II shall not constitute a defense against prosecution under RSA 638:20 or any other criminal statute.
IV. “Electronic signature” shall have the same definition as under RSA 294-E:2.
V. “Written signature” means an original signature or a duplicate copy made by photocopying, facsimile, or other means similar and does not include stamped signatures.
378:4 New Section; Workers’ Compensation; Certificates of Insurance. Amend RSA 412 by inserting after section 37 the following new section:
412:37-a Certificates of Insurance. Every certificate of insurance issued or presented in this state pursuant to a workers’ compensation insurance policy shall contain the following information:
I. All states for which such statutory coverage is provided;
II. Names of all executive officers or members who are excluded, if any, pursuant to RSA 281-A:18-a, or a notation that no executive officers or members are excluded; and
III. Names of all sole proprietors or partners who have elected to be covered under the policy or a notation that no sole proprietors or partners are covered.
378:5 Insurance Fraud; Definitions Added. RSA 638:20, I and I-a are repealed and reenacted to read as follows:
I. In this section:
(a) “Bidding” includes a bid made as any contractor, general contractor, or subcontractor.
(b) “Financial interest” means any direct or indirect interest in the entity, whether as an owner, partner, officer, manager, employee, agent, consultant, advisor, or representative, but does not include an employee who does not participate in management of the entity and ownership in a mutual or common investment fund that holds securities unless the person participates in the management of the fund.
(c) “Insurance policy” includes an actual or purported insurance policy.
(d) “Insurer’‘ includes any insurance company, health maintenance organization, or reinsurance company, or broker or agent thereof, or insurance claims adjuster.
(e) “Participating in public works projects” means bidding or working on any public works project or holding any financial interest in any entity bidding or working on any public works project.
(f) “Public works project” means any construction project financed by public funds.
(g) “Statement’‘ includes, but is not limited to, any notice, statement, proof of loss, bill of lading, receipt of payment, invoice, account, estimate of property damages, bill for service, diagnosis, prescription, hospital or doctor records, x-rays, test results, or other evidence of loss, injury, or expense.
378:6 New Paragraphs; Insurance Fraud; Penalties. Amend RSA 638:20 by inserting after paragraph V the following new paragraphs:
VI. In addition to any other penalty authorized by law, any person convicted of violating subparagraphs II(a), (b), or (d) relative to a workers’ compensation insurance policy shall, as a condition of his or her sentence, be prohibited from participating in any public works projects for a period of no less than one year and no more than 3 years and shall be ordered to pay restitution to its workers’ compensation carrier, as determined by the sentencing court. Any person convicted of a third or subsequent violation may, as a condition of his or her sentence, be permanently banned from participating in any public works projects. For the purposes of this paragraph, “restitution” means the difference between the premium actually charged and the premium amount that would have been charged if accurate information had been provided to the carrier, provided that the carrier is not compensated by the offender more than once.
VII. The commissioner of the department of administrative services shall maintain a list of persons who have been banned from participating in public works projects under this section. Such list shall be a public record under 91-A.
378:7 Task Force Established. There is established a task force to study employee misclassification.
378:8 Membership and Compensation.
I. The members of the task force shall be as follows:
(a) One member of the senate, appointed by the president of the senate.
(b) Two members of the house of representatives, appointed by the speaker of the house of representatives.
(c) The commissioner of the department of labor, or designee.
(d) The commissioner of the department of employment security, or designee.
(e) The commissioner of the department of insurance, or designee.
(f) The commissioner of the department of revenue administration, or designee.
(g) The attorney general, or designee.
(h) A member of each of 2 labor unions representing building trades, appointed by the governor.
(i) A member of an organization representing contractors in the residential construction industry, appointed by the governor.
(j) A member of an organization representing contractors in the non-residential construction industry, appointed by the governor.
(k) A small business owner from outside the construction industry, appointed by the governor.
(l) A large business owner from outside the construction industry, appointed by the governor.
(m) Two representatives of insurance carriers, appointed by the governor.
II. Legislative members of the task force shall receive mileage at the legislative rate when attending to the duties of the task force.
378:9 Duties. The task force shall study employee misclassification.
378:10 Chairperson; Quorum. The members of the task force shall elect a chairperson from among the members. The first meeting of the task force shall be called by the first-named senate member. The first meeting of the task force shall be held within 45 days of the effective date of this section. Six members of the task force shall constitute a quorum.
378:11 Report. The task force shall make interim reports of its findings and any recommendations for proposed legislation on or before December 1, 2008, October 1, 2009, and June 1, 2010, and a final report of its findings and any recommendations for proposed legislation on or before December 1, 2010 to the president of the senate, the speaker of the house of representatives, the senate clerk, the house clerk, the governor, and the state library.
378:12 Contingency. If HB 1367 of the 2008 regular legislative session becomes law, then RSA 21-I:13, XV as inserted by section 1 of this act shall be renumbered as RSA 21-I:13, XVII.
378:13 Effective Date.
I. Sections 7-12 of this act shall take effect upon its passage.
II. The remainder of this act shall take effect January 1, 2009.
Approved: July 11, 2008
Effective Date: I. Sections 7-12 shall take effect July 11, 2008
II. Remainder shall take effect January 1, 2009.