2019 -- H 6184

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LC002568

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2019

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A N   A C T

RELATING TO INSURANCE -- LIFE INSURANCE POLICIES AND RESERVES

     

     Introduced By: Representatives Caldwell, Speakman, Mendez, Vella-Wilkinson, and
Ackerman

     Date Introduced: June 05, 2019

     Referred To: House Health, Education & Welfare

     It is enacted by the General Assembly as follows:

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     SECTION 1. Chapter 27-4 of the General Laws entitled "Life Insurance Policies and

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Reserves" is hereby amended by adding thereto the following section:

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     27-4-1.1. Denial of applicant based on naloxone prescription.

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     No life insurance company organized or doing business within this state shall deny the

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application of an individual seeking coverage for any life insurance products pursuant to this

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chapter solely on the basis that the applicant has a prescription to carry or possess the drug

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naloxone.

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     SECTION 2. Section 27-4.8-1 of the General Laws in Chapter 27-4.8 entitled "Group

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Life Insurance" is hereby amended to read as follows:

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     27-4.8-1. Group life insurance definitions.

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     Except as provided in 27-4.8-2, no policy of group life insurance shall be delivered in this

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state unless it conforms to one of the following descriptions:

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     (1) A policy issued to an employer, or to the trustees of a fund established by an

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employer, which employer or trustees shall be deemed the policyholder, to insure employees of

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the employer for the benefit of persons other than the employer, subject to the following

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requirements:

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     (i) The employees eligible for insurance under the policy shall be all of the employees of

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the employer, or all of any class or classes thereof. The policy may provide that the term

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"employees" shall include the employees of one or more subsidiary corporations, and the

 

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employees, individual proprietors, and partners of one or more affiliated corporations,

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proprietorships or partnerships if the business of the employer and of the affiliated corporations,

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proprietorships or partnerships is under common control. The policy may provide that the term

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"employees" shall include the individual proprietor or partners if the employer is an individual

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proprietorship or partnership. The policy may provide that the term "employees" may include

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retired employees, former employees and directors of a corporate employer. A policy issued to

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insure the employees of a public body may provide that the term "employees" shall include

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elected or appointed officials.

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     (ii) The premium for the policy shall be paid either from the employer's funds or from

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funds contributed by the insured employees, or from both. Except as provided in paragraph (iii), a

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policy on which no part of the premium is to be derived from funds contributed by the insured

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employees shall insure all eligible employees, except those who reject the coverage in writing.

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     (iii) An insurer may exclude or limit the coverage on any person as to whom evidence of

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individual insurability is not satisfactory to the insurer; provided, however, that any exclusion or

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limitation shall not be based solely on the fact that the person has a prescription to carry or

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possess the drug naloxone.

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     (2) A policy issued to a creditor or its parent holding company or to a trustee or trustees

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or agent designated by two (2) or more creditors, which creditor, holding company, affiliate,

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trustee, trustees or agent shall be deemed the policyholder, to insure debtors of the creditor or

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creditors subject to the following requirements:

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     (i) The debtors eligible for insurance under the policy shall be all of the debtors of the

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creditor or creditors, or all of any class or classes thereof. The policy may provide that the term

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"debtors" shall include:

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     (A) Borrowers of money or purchasers or lessees of goods, services or property for which

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payment is arranged through a credit transaction;

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     (B) The debtors of one or more subsidiary corporations; and

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     (C) The debtors of one or more affiliated corporations, proprietorships or partnerships if

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the business of the policyholder and of the affiliated corporations, proprietorships or partnerships

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is under common control.

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     (ii) The premium for the policy shall be paid either from the creditor's finds, or from

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charges collected from the insured debtors, or from both. Except as provided in paragraph (3), a

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policy on which no part of the premium is to be derived from the funds contributed by insured

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debtors specifically for their insurance shall insure all eligible debtors.

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     (iii) An insurer may exclude any debtors as to whom evidence of individual insurability is

 

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not satisfactory to the insurer; provided, however, that any exclusion shall not be based solely on

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the fact that the person has a prescription to carry or possess the drug naloxone.

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     (iv) The amount of the insurance on the life of any debtor shall at no time exceed the

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greater of the scheduled or actual amount of unpaid indebtedness to the creditor, except that

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insurance written in connection with open-end credit having a credit limit exceeding ten-thousand

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dollars ($10,000) may be in an amount not exceeding the credit limit.

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     (v) The insurance may be payable to the creditor or any successor to the right, title, and

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interest of the creditor. The payment shall reduce or extinguish the unpaid indebtedness of the

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debtor to the extent of the payment and any excess of the insurance shall be payable to the estate

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of the insured.

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     (vi) Notwithstanding the provisions of the above subsections, insurance on agricultural

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credit transaction commitments may be written up to the amount of the loan commitment on a

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non-decreasing or level term plan. Insurance on educational credit transaction commitments may

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be written up to the amount of the loan commitment less the amount of any repayments made on

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the loan.

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     (3) A policy issued to a labor union, or similar employee organization, which shall be

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deemed to be the policyholder, to insure members of the union or organization for the benefit of

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persons other than the union or organization or any of its officials, representatives or agents,

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subject to the following requirements:

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     (i) The members eligible for insurance under the policy shall be all of the members of the

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union or organization, or all of any class or classes thereof.

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     (ii) The premium for the policy shall be paid either from funds of the union or

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organization, or from funds contributed by the insured members specifically for their insurance,

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or from both. Except as provided in paragraph (iii), a policy on which no part of the premium is

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to be derived from funds contributed by the insured members specifically for their insurance shall

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insure all eligible members, except those who reject the coverage in writing.

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     (iii) An insurer may exclude or limit the coverage on any persons to whom evidence of

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individual insurability is not satisfactory to the insurer; provided, however, that any exclusion or

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limitation shall not be based solely on the fact that the person has a prescription to carry or

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possess the drug naloxone.

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     (4) A policy issued to a trust or to the trustees of a fund established or adopted by two (2)

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or more employers, or by one or more labor unions or similar employee organizations, or by one

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or more employers and one or more labor unions or similar employee organizations, which trust

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or trustees shall be deemed the policyholder, to insure employees of the employers or members of

 

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the unions or organizations for the benefit of person other than the employers or the unions or

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organizations, subject to the following requirements:

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     (i) The persons eligible for insurance shall be all of the employees of the employers or all

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of the members of the unions or organizations, or all of any class or classes thereof. The policy

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may provide that the term "employees" shall include the employees of one or more subsidiary

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corporations, and the employees, individual proprietors, and partners of one or more affiliated

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corporations, proprietorships or partnerships if the business of the employer and of the affiliated

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corporations, proprietorships or partnerships is under common control. The policy may provide

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that the term "employees" shall include the individual proprietor or partners if the employer is an

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individual proprietorship or partnership. The policy may provide that the term "employees" shall

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include retired employees, former employees and directors of a corporate employer. The policy

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may provide that the term "employees" shall include the trustees or their employees, or both, if

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their duties are principally connected with the trusteeship.

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     (ii) The premium for the policy shall be paid from funds contributed by the employer or

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employers of the insured persons, or by the union or unions or similar employee organizations, or

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by both, or from funds contributed by the insured persons or from both the insured persons and

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the employers or unions or similar employee organizations. Except as provided in paragraph (iii),

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a policy on which no part of the premium is to be derived from funds contributed by the insured

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persons specifically for their insurance shall insure all eligible persons, except those who reject

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the coverage in writing.

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     (iii) An insurer may exclude or limit the coverage on any person as to whom evidence of

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individual insurability is not satisfactory to the insurer; provided, however, that any exclusion or

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limitation shall not be based solely on the fact that the person has a prescription to carry or

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possess the drug naloxone.

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     (5) A policy issued to an association or to a trust or to the trustees of a fund established,

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created, or maintained for the benefit of members of one or more associations. The association or

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associations shall have at the outset a minimum of one hundred (100) persons; shall have been

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organized and maintained in good faith for purposes other than that obtaining insurance; shall

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have been in active existence for at least two (2) years; and shall have a constitution and by-laws

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which provides that:

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     (i) The association or associations hold regular meetings not less than annually to further

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purposes of the members,

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     (ii) Except for credit unions, the association or associations, collect dues or solicit

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contributions from members, and

 

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     (iii) The members have voting privileges and representation on the governing board and

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committees. The policy shall be subject to the following requirements:

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     (A) The policy may insure members of the association or associations, employees thereof

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or employees of members, or one or more of the preceding or all of any class or classes thereof

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for the benefit of persons other than the employee's employer.

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     (B) The premium for the policy shall be paid from funds contributed by the association or

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associations, or by employer members, or by both, or from funds contributed by the covered

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persons or from both the covered persons and the association, associations, or employer members.

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     (C) Except as provided in paragraph (D), a policy on which no part of the premium is to

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be derived from funds contributed by the covered persons specifically for the insurance shall

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insure all eligible persons, except those who reject the coverage in writing.

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     (D) An insurer may exclude or limit the coverage on any person as to whom evidence of

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individual insurability is not satisfactory to the insurer; provided, however, that any exclusion or

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limitation shall not be based solely on the fact that the person has a prescription to carry or

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possess the drug naloxone.

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     (6) A policy issued to a credit union or to a trustee or trustees or agent designated by two

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(2) or more credit unions, which credit union, trustee, trustees, or agent shall be deemed

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policyholder, to insure members of the credit union or credit unions for the benefit of persons

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other than the credit union or credit unions, trustee or trustees, or agent or any of their officials,

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subject to the following requirements:

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     (i) The members eligible for insurance shall be all of the members of the credit union or

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credit unions, or all of any class or classes thereof.

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     (ii) The premium for the policy shall be paid by the policyholder from the credit union's

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funds and, except as provided in paragraph (iii), shall insure all eligible members.

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     (iii) An insurer may exclude or limit the coverage on any member as to whom evidence

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of individual insurability is not satisfactory to the insurer; provided, however, that any exclusion

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or limitation shall not be based solely on the fact that the person has a prescription to carry or

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possess the drug naloxone.

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     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE -- LIFE INSURANCE POLICIES AND RESERVES

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     This act would prohibit an insurer from denying the application of a person or exclude or

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limit coverage for the person under a group policy for life insurance products based solely on the

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fact that the person has a prescription to carry or possess the drug naloxone.

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     This act would take effect upon passage.

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