2014 -- S 2307

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LC004380

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO INSURANCE - CASUALTY INSURANCE GENERALLY

     Introduced By: Senator Roger Picard

     Date Introduced: February 12, 2014

     Referred To: Senate Commerce

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 27-8-11 of the General Laws in Chapter 27-8 entitled "Casualty

Insurance Generally" is hereby amended to read as follows:

     27-8-11. Regulations on cancellation and renewal. -- (a) In addition to and not in lieu

of any other power the commissioner has to issue rules and regulations, the commissioner of

insurance may promulgate, in accordance with the procedure established in chapter 35 of title 42,

reasonable rules and regulations concerning cancellation and renewal of liability and property

damage insurance for automobiles rated as private passenger automobiles. Those regulations may

require that the insurer shall furnish to the named insured the reason or reasons for cancellation or

nonrenewal. Those regulations shall also require that the insurer furnish, at least thirty (30) days

prior to renewal, written notice of material coverage modifications any coverage elimination,

reduction, diminution or increased deductible not at the request of the insured; and in this case the

notice shall itemize and describe the coverage changes and shall be separate from the renewal

policy and the notice shall be captioned "INSURANCE COVERAGE REDUCTION NOTICE".

If the insurer fails to provide such notice, the coverage provided to the named insured shall

remain in effect until notice is provided or until the effective date of replacement coverage

obtained by the named insured, whichever occurs first. For the purpose of this section, notice is

considered given thirty (30) days following the date of giving of the notice. These coverage

changes must be approved by the insurance division with respect to those types of insurance

defined in section 27-8-1(1) -- (8), issued to non-business insured and bodily injury and property

damage liability coverage issued to non-business insured. There shall be no liability on the part

of, and no cause of action of any nature shall arise against, the commissioner of insurance or any

insurer, their authorized representatives, agents, or employees, or any firm, person, or corporation

furnishing to the insurer or commissioner information as to the reasons for cancellation or

nonrenewal, for any statement made by any of them in any written notice of cancellation or

nonrenewal, or in any other communication oral or written specifying the reasons for cancellation

or nonrenewal, or for the providing of information pertaining to the cancellation or nonrenewal,

or for statements made or evidence submitted at any hearing conducted in connection with the

cancellation or nonrenewal.

      (b) The commissioner shall promulgate regulations with respect to personal motor

vehicle insurance, homeowners insurance, and residential fire insurance, or any components of

that insurance requiring notification to policyholders upon renewal of any material changes in

policy deductibles, limits, coverage, conditions or definitions, unless the change was requested by

the policyholder. coverage elimination, reduction, diminution or increased deductible not at the

request of the insured.

     SECTION 2. This act shall take effect on January 1, 2015.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE - CASUALTY INSURANCE GENERALLY

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     This act would require insurers to send insureds a notice captioned "Insurance Coverage

Reduction Notice" itemizing and describing any coverage elimination, reduction, diminution or

increased deductible not at the request of the insureds. This act would also provide that failure of

the insurers to provide the notice would void any coverage changes until the notice were provided

or until the effective date of replacement coverage were obtained by the insureds, whichever

occurs first.

     This act would take effect on January 1, 2015.

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