2017 -- H 5631 | |
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LC001798 | |
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STATE OF RHODE ISLAND | |
IN GENERAL ASSEMBLY | |
JANUARY SESSION, A.D. 2017 | |
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A N A C T | |
RELATING TO INSURANCE - INSURANCE CONSUMER PROTECTION SALES ACT | |
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Introduced By: Representatives Marshall, and Costantino | |
Date Introduced: March 01, 2017 | |
Referred To: House Corporations | |
It is enacted by the General Assembly as follows: | |
1 | SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended |
2 | by adding thereto the following chapter: |
3 | CHAPTER 82 |
4 | INSURANCE CONSUMER PROTECTION SALES ACT |
5 | 27-82-1. Short title. |
6 | This chapter shall be known and may be cited as the "Insurance Consumer Protection |
7 | Sales Act." |
8 | 27-82-2. Purpose. |
9 | The purpose of this chapter is to regulate noninsurance business entities in the disclosure |
10 | of personal identifiable information for insurance sales. |
11 | 27-82-3. Definitions. |
12 | For the purposes of this chapter: |
13 | (1) "Business entity" means an individual, firm, corporation, business trust, association, |
14 | partnership, limited liability company, limited liability partnership or any legal entity, its affiliates |
15 | or subsidiaries and any of its officers, agents, representatives or employees; provided, however, |
16 | "business entity" shall not include financial institutions as defined and subject to the provisions of |
17 | chapter 58 of title 27. |
18 | (2) "Commissioner" means the director of the department of business regulation or their |
19 | designee. |
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1 | (3) "Insurance" includes all products defined or regulated as insurance by the department |
2 | of business regulation except those products offered as follows: |
3 | (i) Portable electronics insurance as defined in §27-2.7-1; |
4 | (ii) Credit life, credit accident and health, credit involuntary unemployment insurance; |
5 | group credit insurance, forced, placed or voluntary credit personal property insurance; group |
6 | mortgage cancellation life insurance, or group mortgage accident and health insurance and |
7 | annuities; |
8 | (iii) Insurance placed by a financial institution in connection with collateral pledged as |
9 | security for a loan when the debtor breaches the contractual obligation to provide that insurance; |
10 | and |
11 | (iv) Private mortgage insurance. |
12 | 27-82-4. Authorization for implementing regulations. |
13 | The commissioner may promulgate administrative regulations to effectuate the purposes |
14 | of this chapter. |
15 | 27-82-5. Anti-tying provisions. |
16 | (a) No person or business entity may offer any tangible personal property for sale or |
17 | lease, or fix or vary the conditions of an offer, on a condition or requirement that the customer |
18 | obtains insurance from the business entity, or any particular insurance producer or insurer. |
19 | (b) No business entity shall require or imply that the purchase of an insurance product |
20 | from a business entity or any particular insurance producer or insurer, by a customer or |
21 | prospective customer is required as a condition of, or is in any way related to the purchase or |
22 | lease of any tangible personal property, the lending of money or extension of credit or the |
23 | provision of services related to an of these activities. |
24 | (c) No business entity shall impose any requirement on any insurance producer or insurer |
25 | who is not associated with the business entity that is not imposed on any insurance producer or |
26 | insurer who is associated with that business entity. |
27 | 27-82-6. Sales force. |
28 | Solicitation for the purchase or sale of insurance by a business entity shall be conducted |
29 | only by persons licensed in accordance with chapter 2.4 of title 27 whose responsibilities do not |
30 | include the sale of a noninsurance related tangible personal property, including, but not limited to, |
31 | salespersons, persons whose responsibilities include a determination of credit qualification, |
32 | financing, or persons assisting those individuals in the sale or lease of any tangible personal |
33 | property. |
34 | 27-82-7. Confidential customer information. |
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1 | (a) As used in this section, unless the context requires otherwise: |
2 | (1) "Customer" means a person seeking to purchase or lease a product. |
3 | (2) "Nonpublic customer information" means personally identifiable financial |
4 | information regarding a person that has been derived from a record of a business entity, |
5 | including, information on the product to be purchased or leased, information concerning the terms |
6 | and conditions of insurance coverage, insurance expirations, insurance claims, or insurance |
7 | history of an individual. Nonpublic customer information does not include customer names, |
8 | addresses or telephone numbers. |
9 | (b) No business entity shall use any nonpublic customer information for the purpose of |
10 | selling or soliciting the purchase of insurance or provide the nonpublic customer information to a |
11 | third party for the purpose of another's sale or solicitation of the purchase of insurance. |
12 | 27-82-8. Insurance in connection with the sale or lease of a tangible personal |
13 | property. |
14 | The transaction of a sale or lease of any tangible personal property and insurance |
15 | transactions shall be completed independently and through separate documents. |
16 | 27-82-9. Physical location of insurance activities. |
17 | The place of solicitation or sale of insurance by any insurance company or any insurance |
18 | producer affiliated with a business entity shall be from an office physically separated from the |
19 | activities associated with the sale or lease of any tangible personal property. Physical separation |
20 | shall not be defined as a separate building. The commissioner shall have the authority to |
21 | promulgate rules and regulations to implement this section pursuant to §27-82-4. |
22 | 27-82-10. Penalties. |
23 | Any business entity or person who violates the provisions of this chapter, who fails to |
24 | perform any duties imposed by this chapter, or who violates any administrative regulation |
25 | promulgated pursuant to this chapter shall be liable for a civil penalty not to exceed the sum of |
26 | one hundred dollars ($100) for each day which the violation continues, and may be concurrently |
27 | enjoined from any further violations by the superior court upon petition of the insurance |
28 | commissioner. |
29 | SECTION 2. This act shall take effect January 1, 2018. |
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EXPLANATION | |
BY THE LEGISLATIVE COUNCIL | |
OF | |
A N A C T | |
RELATING TO INSURANCE - INSURANCE CONSUMER PROTECTION SALES ACT | |
*** | |
1 | This act would create a system of consumer protection for regulation by DBR of |
2 | noninsurance business entities using or disclosing personal identifiable financial information for |
3 | insurance sales. |
4 | This act would take effect on January 1, 2018. |
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