Bill Text: WV SB506 | 2019 | Regular Session | Comm Sub
Bill Title: Relating to guaranty associations
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2019-02-22 - Referred to Rules on 2nd reading [SB506 Detail]
Download: West_Virginia-2019-SB506-Comm_Sub.html
WEST virginia legislature
2019 regular session
Committee Substitute
for
Senate Bill 506
Senator Azinger, original sponsor
[Originating in the Committee on Banking and Insurance; Reported on February 20, 2019]
A BILL to amend and reenact §33-26A-19 of the Code of West Virginia, 1931, as amended, relating to guaranty associations; and updating language to increase consistency with the Life and Health Insurance Guaranty Association Model Act of the National Association of Insurance Commissioners.
Be it enacted by the Legislature of West Virginia:
ARTICLE 26A. WEST VIRGINIA LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION ACT.
§33-26A-19. Prohibited advertisement of insurance guaranty association act in insurance sales; notice to policyholders.
(a) A person, including a member insurer, agent, or affiliate of a member insurer, shall not make, publish, disseminate, circulate, or place before the public, or cause, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public, in any newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter, or poster, or over any radio station or television station, or in any other way, any advertisement, announcement, or statement, written or oral, which uses the existence of the insurance guaranty association of this state for the purpose of sales, solicitation, or inducement to purchase any form of insurance or other coverage covered by the West Virginia Life and Health Insurance Guaranty Association Act: Provided, That this section shall not apply to the association or any other entity which does not sell or solicit insurance or coverage by a health maintenance organization.
(b) Within 180 days of the
effective date of this article, the association shall prepare a summary
document describing the general purposes and current limitations of the act and
complying with §33-26A-19(c) of this code. This document should
shall be submitted to the commissioner for approval. Sixty days
after receiving such approval, no member insurer may deliver a policy or
contract described in §33-26A-3(b)(1) of this code to a policy owner, contract
owner, certificate holder, or enrollee unless the summary document is delivered
to the policy owner, contract owner, certificate holder, or enrollee prior to
or at the time of delivery of the policy or contract. except if
§33-26A-19(d) of this code applies The document should shall also
be available upon request by a policy owner, contract owner, certificate
holder, or enrollee. The distribution, delivery, or contents or interpretation
of this document, shall not guarantee that either the policy or the contract or
the policy owner, contract owner, certificate holder, or enrollee is covered in
the event of the impairment or insolvency of a member insurer. The description
document shall be revised by the association as amendments to the article may
require. Failure to receive this document does not give the policy owner,
contract owner, certificate holder, enrollee, or insured any greater rights
than those stated in this article.
(c) The document prepared
under §33-26A-19(b) of this code shall contain a clear and conspicuous
disclaimer on its face. The commissioner shall propose rules for legislative
approval in accordance with the provisions of §29A-3-1 et seq. of this code
establishing the form and content of the disclaimer. The commissioner
shall establish the form and content of the disclaimer. The disclaimer
shall:
(1) State the name and address of the association and insurance department;
(2) Prominently warn the policy owner, contract owner, certificate holder, or enrollee that the association may not cover the policy or contract or, if coverage is available, it will be subject to substantial limitations and exclusions and conditioned on continued residence in the state;
(3) State the types of policies or contracts for which guaranty funds will provide coverage;
(4) State that the member insurer and its agents are prohibited by law from using the existence of the association for the purpose of sales, solicitation, or inducement to purchase any form of insurance or health maintenance organization coverage;
(5) Emphasize that the policy owner, contract owner, certificate holder, or enrollee should not rely on coverage under the association when selecting an insurer or health maintenance organization;
(6) Explain rights available and procedures for filing a complaint to allege a violation of any provisions of this article; and
(7) Provide other information as directed by the commissioner.
(d) An insurer or agent
may not deliver a policy or contract described in §33-26A-3(b)(1) of this code
and excluded under §33-26A-3(b)(2)(A) of this code from coverage under this
article unless the insurer or agent, prior to or at the time of delivery, gives
the policy owner, contract owner, certificate holder, or enrollee a separate
written notice which clearly and conspicuously discloses that the policy or
contract is not covered by the association. The commissioner shall propose
rules for legislative approval in accordance with the provisions of §29A-3-1 et
seq. of this code specifying the form and content of the notice. A
member insurer shall retain evidence of compliance with §33-26A-19(b) of this
code for so long as the policy or contract for which the notice is given
remains in effect.
NOTE: The purpose of this bill is to update article 26A to maintain consistency with the National Association of Insurance Commissioners’ Life and Health Insurance Guaranty Association Model Act.
Strike-throughs indicate language that would be stricken from a heading or the present law and underscoring indicates new language that would be added.
