Revision: March 18, 2011, midnight
HB 419-FN – AS AMENDED BY THE HOUSE
15Mar2011… 0709h
2011 SESSION
01/09
HOUSE BILL 419-FN
AN ACT relative to language in insurance certificates.
SPONSORS: Rep. Infantine, Hills 13
COMMITTEE: Commerce and Consumer Affairs
This bill establishes the law relative to content and form of certificates of insurance.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
15Mar2011… 0709h
11-0747
01/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eleven
AN ACT relative to language in insurance certificates.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Section; Certificates of Insurance. Amend RSA 412 by inserting after section 6-a the following new section:
412:6-b Certificates of Insurance.
I. In this section:
(a) “Certificate” or “certificate of insurance” means any document or instrument, no matter how titled or described, which is issued by an insurer or insurance producer as evidence of property or casualty insurance coverage. “Certificate” or “certificate of insurance” shall not include a policy of insurance or insurance binder.
(b) “Certificate holder” means any person, other than a policyholder, who possesses a certificate of insurance or is identified as the certificate holder on the certificate.
(c) “Insurance producer” means an insurance producer licensed under RSA 402-J.
(d) “Insurer” means an entity established to conduct the kinds of insurance business as provided in RSA 401 and licensed in accordance with the provisions of RSA 402 or RSA 405.
(e) “Person” means any individual, partnership, corporation, association, or other legal entity, including any government or governmental subdivision or agency.
(f) “Policyholder” means a person who has contracted with a property or casualty insurer for insurance coverage.
II.(a) No person shall issue a certificate of insurance that:
(1) Does not comply with the requirements of subparagraph (b).
(2) Is not in the public interest.
(3) Is contrary to public policy.
(4) Is misleading, deceptive, or encourages misrepresentation.
(5) Violates any law.
(b) The following are requirements for the content, purpose, issuance, and use of certificates of insurance:
(1) Each certificate shall contain the following statement, in sufficient font and size and located on the certificate to be readily identifiable:
“This certificate of insurance is issued as a matter of information only and confers no rights upon the certificate holder. This certificate does not amend, extend, or alter the coverage, terms, exclusions, and conditions afforded by the policy or policies referenced herein.”
(2) No person shall demand or require the issuance of a certificate of insurance from an insurer, insurance producer, or policyholder that contains any false or misleading information concerning any policy of insurance to which the certificate makes reference.
(3) No person shall knowingly prepare or issue a certificate of insurance that contains any false or misleading information.
(4) No person shall prepare or issue a certificate of insurance that purports to affirmatively or negatively alter, amend, or extend the coverage provided by any policy of insurance referenced in the certificate.
(5) The requirements of this section shall apply to certificates of insurance issued as evidence of insurance policies and coverage on property, operations, or any risk located in this state, regardless of where the certificate holder, policyholder, insurer, or insurance producer is located.
(6) No certificate of insurance shall contain references to contracts, including construction or service contracts, other than the referenced contract of insurance.
(7) A certificate holder shall only have a contractual right to notice of cancellation, nonrenewal, or any similar notice concerning a policy of insurance if the person is identified and designated within the policy or any endorsement to that policy as an additional insured and that policy or endorsement requires notice to be provided.
(c) The commissioner may publish sample certificates of insurance which provide templates as to form and content, which, in his or her opinion, meet the requirements of subparagraph (b) and are acceptable for use by insurers and insurance producers. In addition to templates developed by the commissioner, insurance industry trade organizations, and supporting entities, may submit templates for consideration and inclusion in the set of sample certificates so published.
(d) An insurer or insurance producer may prepare or issue an addendum to a certificate that clarifies and explains the coverage provided by any policy of insurance referenced in the certificate and otherwise complies with the requirements of this section.
(e) An insurance producer may charge a reasonable fee to the policyholder or to a certificate holder on behalf of the policyholder in order to cover costs associated with issuing the certificate which are not otherwise provided for in commissions or expense reimbursements that the insurer has contractually agreed to pay that insurance producer.
2 Effective Date. This act shall take effect January 1, 2012.
LBAO
11-0747
Revised 01/27/11
HB 419 FISCAL NOTE
AN ACT relative to language in insurance certificates.
FISCAL IMPACT:
The Insurance Department states this bill will increase state expenditures and may increase state general fund revenue by an indeterminable amount in FY 2012 and each year thereafter. The Department states this bill may have an indeterminable fiscal impact on county and local expenditures. There is no fiscal impact on county and local revenue.
METHODOLOGY:
The Insurance Department states this bill establishes the model law relative to content and form of certificates of insurance, including the possibility that insurers would need to file certificates with the Department. The Department states certificates of insurance are not directly regulated by the Department. This bill will result in the Department dedicating resources to appropriately regulate the use of certificates that will increase costs. The Department does not anticipate the costs to be materially significant but is not able to forecast what the costs might be. The Department states any increased costs to the Department are borne by the insurance industry which may result in higher premiums. An increase in premiums would result in an increase in premium tax revenue. The Department is not able to determine the fiscal impact this bill will have on other state agencies, county agencies or local agencies that may require certificates of insurance from contractors and others that engage in work on their behalf.