Chapter 051 |
2019 -- H 5207 SUBSTITUTE A Enacted 06/28/2019 |
A N A C T |
RELATING TO INSURANCE -- TRAVEL INSURANCE ACT |
Introduced By: Representatives Kennedy, Abney, Azzinaro, Johnston, and Casey |
Date Introduced: January 25, 2019 |
It is enacted by the General Assembly as follows: |
SECTION 1. Chapter 27-79 of the General Laws entitled "Limited Lines Travel |
Insurance Act" is hereby repealed in its entirety. |
CHAPTER 27-79 |
Limited Lines Travel Insurance Act |
27-79-1. Short title. |
This act shall be known and may be cited as the "Limited Lines Travel Insurance Model |
Act." |
27-79-2. Definitions. |
As used in this chapter, the following terms shall mean: |
(1) "Limited lines travel insurance producer" means a licensed insurance producer |
designated by an insurer as the travel insurance supervising producer as set forth in § 27-79-6 |
below. |
(2) "Offer and disseminate" means providing general information, including a description |
of the coverage and price, as well as processing the application, collecting premiums, and |
performing other non-licensable activities permitted by the state. |
(3) "Travel insurance" means insurance coverage for personal risks incident to planned |
travel, including but not limited to: |
(i) Interruption or cancellation of trip or event; |
(ii) Loss of baggage or personal effects; |
(iii) Damages to accommodations or rental vehicles; or |
(iv) Sickness, accident, disability or death occurring during travel. |
Travel insurance does not include major medical plans, which provide comprehensive |
medical protection for travelers with trips lasting six (6) months or longer, including for example, |
those working overseas as an ex-patriot or military personnel being deployed. |
(4) "Travel retailer" means a business entity that makes, arranges or offers travel services |
and may offer and disseminate travel insurance as a service to its customers on behalf of and |
under the direction of a limited lines travel insurance producer. |
27-79-3. Requirements. |
(a) A travel retailer may offer and disseminate travel insurance only if the limited lines |
travel insurance producer complies with the following: |
(1) The limited lines travel insurance producer or travel retailer provides to purchasers of |
travel insurance: |
(i) A description of the material terms or the actual material terms of the insurance |
coverage; |
(ii) A description of the process for filing a claim; |
(iii) A description of the review or cancellation process for the travel insurance policy; |
and |
(iv) The identity and contact information of the insurer and limited lines travel insurance |
producer. |
(2) At the time of licensure, the limited lines travel insurance producer shall establish and |
maintain a register of each travel retailer that offers travel insurance on the limited lines travel |
insurance producer's behalf. The register shall be maintained and updated by the limited lines |
travel insurance producer and shall include the name, address, and contact information of the |
travel retailer and an officer or person who directs or controls the travel retailer's operations, and |
the travel retailer's federal employment identification number. The limited lines travel insurance |
producer shall submit such register to the state insurance department upon reasonable request. |
The limited lines travel insurance producer shall also certify that the travel retailer registered |
complies with applicable federal law. |
(3) The limited lines travel insurance producer is responsible for compliance with the |
travel insurance laws, rules and regulations of the state. |
(4) The limited lines travel insurance producer has paid all applicable insurance producer |
licensing fees. |
(5) The limited lines travel insurance producer requires each employee of the travel |
retailer whose duties include offering and disseminating travel insurance to receive a program of |
instruction or training, which may be subject to review by the commissioner. The training |
material shall, at a minimum, contain instructions on the types of insurance offered, ethical sales |
practices, and required disclosures to prospective customers. |
(b) Any travel retailer offering or disseminating travel insurance shall make available to |
prospective purchasers brochures or other written materials that: |
(1) Provide the identity and contact information of the insurer and the limited lines travel |
insurance producer; |
(2) Explain that the purchase of travel insurance is not required in order to purchase any |
other product or service from the travel retailer; and |
(3) Explain that an unlicensed travel retailer is permitted to provide general information |
about the insurance offered by the travel insurance producer or insurer, including a description of |
the coverage and price, but is not qualified or authorized to answer technical questions about the |
terms and conditions of the insurance offered by the travel retailer or to evaluate the adequacy of |
the customer's existing insurance coverage. |
(c) A travel retailer who is not licensed as an insurance producer may not: |
(1) Evaluate or interpret the technical terms, benefits, and conditions of the offered travel |
insurance coverage; |
(2) Evaluate or provide advice concerning a prospective purchaser's existing insurance |
coverage; or |
(3) Hold himself/herself or itself out as a licensed insurer, licensed producer, or insurance |
expert. |
27-79-4. Compensation. |
A travel retailer whose insurance-related activities, and those of its employees, are |
limited to offering and disseminating travel insurance on behalf of and under the direction of a |
limited lines travel insurance producer meeting the conditions stated in this chapter, is authorized |
to do so and receive related compensation. |
27-79-5. Policy. |
Travel insurance may be provided under an individual policy or under a group or master |
policy. |
27-79-6. Responsibility. |
As the insurer designee, the limited lines travel insurance producer is responsible for the |
acts of the travel retailer and shall use reasonable means to ensure compliance by the travel |
retailer with this chapter. |
27-79-7. Enforcement. |
The limited lines travel insurance producer and any travel retailer offering and |
disseminating travel insurance under the limited lines travel insurance producer license shall be |
subject to the penalties for violations of this chapter pursuant to § 42-14-16. |
SECTION 2. Title 27 of the General Laws entitled "INSURANCE" is hereby amended |
by adding thereto the following chapter: |
CHAPTER 79.1 |
TRAVEL INSURANCE ACT |
27-79.1-1. Short title. |
This chapter shall be known and may be cited as the "Travel Insurance Act." |
27-79.1-2. Scope and purposes. |
(a) The purpose of this chapter is to promote the public welfare by creating a |
comprehensive legal framework within which travel insurance may be sold in this state. |
(b) The requirements of this chapter shall apply to travel insurance policies and |
certificates which that are delivered or issued for delivery in this state. It shall not apply to |
cancellation fee waivers and travel assistance services, except as expressly provided herein. |
(c) All other applicable provisions of the state's insurance laws shall continue to apply to |
travel insurance; provided, that, the specific provisions of this chapter shall supersede any other |
provisions of the general or public laws that would otherwise be applicable to travel insurance. |
27-79.1-3. Definitions. |
As used in this chapter, the following terms shall have the following meanings: |
(1) "Aggregator site" means a website that provides access to information regarding |
insurance products from more than one insurer, including product and insurer information, for use |
in comparison shopping. |
(2) "Blanket travel insurance" means a policy of travel insurance issued to any eligible |
group providing coverage for specific classes of persons defined in the policy, with coverage |
provided to all members of the eligible group without a separate charge to individual members of |
the eligible group. |
(3) "Cancellation fee waiver" means a contractual agreement between a supplier of travel |
services and its customer to waive some or all of the non-refundable cancellation fee provisions |
of the supplier's underlying travel contract, with or without regard to the reason for the |
cancellation or form of reimbursement. A cancellation fee waiver is not insurance. |
(4) "Eligible group," for the purposes of travel insurance, means two (2) or more persons |
who are engaged in a common enterprise, or have an economic, educational, or social affinity or |
relationship, including, but not limited to, any of the following: |
(i) Any entity engaged in the business of providing travel or travel services, including, |
but not limited to, tour operators, lodging providers, vacation property owners, hotels and resorts, |
travel clubs, travel agencies, property managers, cultural exchange programs, and common |
carriers or the operator, owner, or lessor of a means of transportation of passengers, including, but |
not limited to, airlines, cruise lines, railroads, steamship companies, and public bus carriers, |
wherein, with regard to any particular travel or type of travel or travelers, all members or |
customers of the group must have a common exposure to risk attendant to the travel; |
(ii) Any college, school, or other institution of learning covering students, teachers, or |
employees or volunteers; |
(iii) Any employer covering any group of employees, volunteers, contractors, board of |
directors, dependents, or guests; |
(iv) Any sports team, camp, or sponsor thereof covering participants, members, campers, |
employees, officials, supervisors, or volunteers; |
(v) Any religious, charitable, recreational, educational, or civic organization or branch |
thereof covering any group of members, participants, or volunteers; |
(vi) Any financial institution or financial institution vendor, or parent holding company, |
trustee, or agent of, or designated by, one or more financial institutions or financial institution |
vendors, including accountholders, credit card holders, debtors, guarantors, or purchasers; |
(vii) Any incorporated or unincorporated association, including labor unions, having a |
common interest, constitution, and bylaws, and organized and maintained in good faith for |
purposes other than obtaining insurance for members or participants of such association covering |
its members; |
(viii) Any trust or the trustees of a fund established, created, or maintained for the benefit |
of and covering members, employees, or customers, subject to the insurance commissioner |
permitting the use of a trust and the state's premium tax provisions in § 27-79.1-6 of one or more |
associations meeting the requirements of subsection (4)(vii) of this section; |
(ix) Any entertainment production company covering any group of participants, |
volunteers, audience members, contestants, or workers; |
(x) Any volunteer fire department, ambulance, rescue, police, court or any first aid, civil |
defense, or other such volunteer group; |
(xi) Preschools, daycare institutions for children or adults, and senior citizen clubs; |
(xii) Any automobile or truck rental or leasing company covering a group of individuals |
who may become renters, lessees, or passengers defined by their travel status on the rented or |
leased vehicles. The common carrier, the operator, owner, or lessor of a means of transportation, |
or the automobile or truck rental or leasing company, is the policyholder under a policy to which |
this section applies; or |
(xiii) Any other group where the commissioner has determined that the members are |
engaged in a common enterprise, or have an economic, educational, or social affinity or |
relationship, and that issuance of the policy would not be contrary to the public interest. |
(5) "Fulfillment materials" means documentation sent to the purchaser of a travel |
protection plan confirming the purchase and providing the travel protection plan's coverage and |
assistance details. |
(6) "Group travel insurance" means travel insurance issued to any eligible group. |
(7) "Limited lines travel insurance producer" means: |
(i) Licensed managing general agent or third-party administrator; |
(ii) Licensed insurance producer, including a limited lines producer; or |
(iii) Travel administrator. |
(8) "Offer and disseminate" means providing general information, including a description |
of the coverage and price, as well as processing the application, and collecting premiums. |
(9) "Primary certificate holder" means an individual person who elects and purchases |
travel insurance under a group policy. |
(10) "Primary policyholder" means an individual person who elects and purchases |
individual travel insurance. |
(11) "Travel administrator" means a person who directly or indirectly underwrites, |
collects charges, collateral, or premiums from, or adjusts or settles claims on residents of this |
state, in connection with travel insurance, except that a person shall not be considered a travel |
administrator if that person's only actions that would otherwise cause it to be considered a travel |
administrator are among the following: |
(i) A person working for a travel administrator to the extent that the person's activities are |
subject to the supervision and control of the travel administrator; |
(ii) An insurance producer selling insurance or engaged in administrative and claims- |
related activities within the scope of the producer's license; |
(iii) A travel retailer offering and disseminating travel insurance, and registered under the |
license of a limited lines travel insurance producer in accordance with this chapter; |
(iv) An individual adjusting or settling claims in the normal course of that individual's |
practice or employment as an attorney at law and who does not collect charges or premiums in |
connection with insurance coverage; or |
(v) A business entity that is affiliated with a licensed insurer while acting as a travel |
administrator for the direct and assumed insurance business of an affiliated insurer. |
(12) "Travel assistance services" means non-insurance services for which the consumer is |
not indemnified based on a fortuitous event, and where providing the service does not result in |
transfer or shifting of risk that would constitute the business of insurance. Travel assistance |
services include, but are not limited to: security advisories; destination information; vaccination |
and immunization information services; travel reservation services; entertainment; activity and |
event planning; translation assistance; emergency messaging; international legal and medical |
referrals; medical case monitoring; coordination of transportation arrangements; emergency cash |
transfer assistance; medical prescription replacement assistance; passport and travel document |
replacement assistance; lost luggage assistance; concierge services; and any other service that is |
furnished in connection with planned travel. Travel assistance services are not insurance and not |
related to insurance. |
(13) "Travel insurance" means insurance coverage for personal risks incident to planned |
travel, including: |
(i) Interruption or cancellation of trip or event; |
(ii) Loss of baggage or personal effects; |
(iii) Damages to accommodations or rental vehicles; |
(iv) Sickness, accident, disability, or death occurring during travel; |
(v) Emergency evacuation; |
(vi) Repatriation of remains; or |
(vii) Any other contractual obligations to indemnify or pay a specified amount to the |
traveler upon determinable contingencies related to travel as approved by the commissioner. |
Travel insurance does not include major medical plans, that provide comprehensive |
medical protection for travelers with trips lasting longer than six (6) months, including, for |
example, those working or residing overseas as an expatriate, or any other product that requires a |
specific insurance producer license. |
(14) "Travel protection plans" means plans that provide one or more of the following: |
(i) Travel insurance,; |
(ii) Travel assistance services,; and |
(iii) Cancellation fee waivers. |
(15) "Travel retailer" means a business entity that makes, arranges, or offers planned |
travel services, and may offer and disseminate travel insurance as a service to its customers on |
behalf of, and under the direction of, a limited lines travel insurance producer. |
27-79.1-4. Licensing and registration requirements. |
(a) The commissioner may issue to an individual or business entity that has filed with the |
commissioner an application for a limited lines travel insurance producer license in a form and |
manner prescribed by the commissioner, a limited lines travel insurance producer license, which |
that authorizes the limited lines travel insurance producer to sell, solicit, or negotiate travel |
insurance through a licensed insurer. No person may act as a limited lines travel insurance |
producer or travel insurance retailer unless properly licensed or registered. |
(b) A travel retailer may offer and disseminate travel insurance under a limited lines |
travel insurance producer business entity license only if the following conditions are met: |
(1) The limited lines travel insurance producer or travel retailer provides to purchasers of |
travel insurance: |
(i) A description of the material terms or the actual material terms of the insurance |
coverage; |
(ii) A description of the process for filing a claim; |
(iii) A description of the review or cancellation process for the travel insurance policy; |
and |
(iv) The identity and contact information of the insurer and limited lines travel insurance |
producer.; |
(2) At the time of licensure, the limited lines travel insurance producer shall establish and |
maintain a register, on a form prescribed by the commissioner, of each travel retailer, that offers |
travel insurance on the limited lines travel insurance producer's behalf. The register shall be |
maintained and updated by the limited lines travel insurance producer, and shall include the |
name, address, and contact information of the travel retailer, and an officer or person who directs |
or controls the travel retailer's operations, and the travel retailer's federal tax identification |
number. The limited lines travel insurance producer shall submit the register to the commissioner |
upon reasonable request. The limited lines travel insurance producer shall also certify that the |
travel retailer registered complies with 18 U.S.C. § 1033. The grounds for the suspension, |
revocation, and the penalties applicable to resident insurance producers shall be applicable to the |
limited lines travel insurance producers and travel retailers.; |
(3) The limited lines travel insurance producer has designated one of its employees who |
is a licensed individual producer as the person (a "designated responsible producer" or "DRP") |
responsible for the compliance with the travel insurance laws and regulations applicable to the |
limited lines travel insurance producer and its registrants.; |
(4) The DRP, president, secretary, treasurer, and any other officer or person who directs |
or controls the limited lines travel insurance producer's insurance operations shall comply with |
the fingerprinting requirements applicable to insurance producers in the resident state of the |
limited lines travel insurance producer.; |
(5) The limited lines travel insurance producer has paid all applicable licensing fees as set |
forth in applicable state law.; |
(6) The limited lines travel insurance producer must require each employee and |
authorized representative of the travel retailer whose duties include offering and disseminating |
travel insurance, to receive a program of instruction or training, which is subject at the discretion |
of the commissioner for review and approval. The training material shall, at a minimum, contain |
adequate instructions on the types of insurance offered, ethical sales practices, and required |
disclosures to prospective customers. |
(c) Any travel retailer offering or disseminating travel insurance shall make available to |
prospective purchasers brochures or other written materials that have been approved by the travel |
insurer. Such materials shall include information which, at a minimum: |
(1) Provides the identity and contact information of the insurer and the limited lines travel |
insurance producer; |
(2) Explains that the purchase of travel insurance is not required in order to purchase any |
other product or service from the travel retailer; and |
(3) Explains that an unlicensed travel retailer is permitted to provide only general |
information about the insurance offered by the travel retailer, including a description of the |
coverage and price, but is not qualified or authorized to answer technical questions about the |
terms and conditions of the insurance offered by the travel retailer or to evaluate the adequacy of |
the customer's existing insurance coverage. |
(d) A travel retailer employee or authorized representative, who is not licensed as an |
insurance producer, may not: |
(1) Evaluate or interpret the technical terms, benefits, and conditions of the offered travel |
insurance coverage; |
(2) Evaluate or provide advice concerning a prospective purchaser's existing insurance |
coverage; or |
(3) Hold themselves out as a licensed insurer, licensed producer, or insurance expert. |
(e) Any person licensed in a major line of authority as an insurance producer is |
authorized to sell, solicit, and negotiate travel insurance. A property and casualty insurance |
producer is not required to become appointed by an insurer in order to sell, solicit, or negotiate |
travel insurance. |
27-79.1-5. Compensation. |
A travel retailer whose insurance-related activities, and those of its employees, are |
limited to offering and disseminating travel insurance on behalf of and under the direction of a |
limited lines travel insurance producer meeting the conditions stated in this chapter, is authorized |
to do so and receive related compensation. |
27-79.1-6. Premium tax. |
(a) A travel insurer shall pay a gross premiums tax, as provided in § 44-17-2, on travel |
insurance premiums paid by any of the following: |
(1) An individual primary policyholder who is a resident of this state; |
(2) A primary certificate holder who is a resident of this state who elects coverage under |
a group travel insurance policy; or |
(3) A blanket travel insurance policyholder that is resident in, or has its principal place of |
business or the principal place of an affiliate or subsidiary that has purchased blanket travel |
insurance in this state for eligible blanket group members, subject to any apportionment rules |
which that apply to the insurer across multiple taxing jurisdictions, or that permits the insurer to |
allocate premiums on an apportioned basis in a reasonable and equitable manner in those |
jurisdictions. |
(b) A travel insurer shall: |
(1) Document the state of residence or principal place of business of the policyholder or |
certificate holder, as required in this chapter; and |
(2) Report as premium only the amount allocable to travel insurance, and not any |
amounts received for travel assistance services or cancellation fee waivers. |
27-79.1-7. Travel protection plans. |
(a) Travel protection plans may be offered for one price for the combined features that |
the travel protection plan offers in this state if: |
(1) The travel protection plan clearly discloses to the consumer at, or prior to the time of |
purchase, that it includes travel insurance, travel assistance services, and cancellation fee waivers, |
as applicable, and provides information and an opportunity at, or prior to the time of purchase, for |
the consumer to obtain additional information regarding the features and pricing of each; and |
(2) The fulfillment materials: |
(i) Describe and delineate the travel insurance, travel assistance services, and cancellation |
fee waivers in the travel protection plan; and |
(ii) Include the travel insurance disclosures and the contact information for persons |
providing travel assistance services and cancellation fee waivers, as applicable. |
27-79.1-8. Sales practices. |
(a) All persons offering travel insurance to residents of this state are subject to the unfair |
trade practices provided in chapter 29 of title 27, except as otherwise provided in this section. In |
the event of a conflict between this chapter, and other provisions of this title regarding the sale |
and marketing of travel insurance and travel protection plans, the provisions of this chapter shall |
control. |
(b) Offering or selling a travel insurance policy that could never result in the payment of |
any claims for any insured under the policy is an unfair trade practice under chapter 29 of title 27. |
(c)(1) All documents provided to consumers prior to the purchase of travel insurance, |
including, but not limited to, sales materials, advertising materials, and marketing materials, shall |
be consistent with the travel insurance policy itself, including, but not limited to, forms, |
endorsements, policies, rate filings, and certificates of insurance. |
(2) For travel insurance policies or certificates that contain pre-existing condition |
exclusions, information and an opportunity to learn more about the pre-existing condition |
exclusions shall be provided any time prior to the time of purchase, and in the coverage's |
fulfillment materials. |
(3) The fulfillment materials and the information described in § 27-79.1-4(b)(1)(i)-(iv) |
shall be provided to a policyholder or certificate holder as soon as practicable following the |
purchase of a travel protection plan. Unless the insured has either started a covered trip or filed a |
claim under the travel insurance coverage, a policyholder or certificate holder may cancel a |
policy or certificate for a full refund of the travel protection plan price from the date of purchase |
of a travel protection plan until at least: |
(i) Fifteen (15) days following the date of delivery of the travel protection plan's |
fulfillment materials by postal mail; or |
(ii) Ten (10) days following the date of delivery of the travel protection plan's fulfillment |
materials by means other than postal mail. For the purposes of this section, "delivery" means |
handing fulfillment materials to the policyholder or certificate holder, or sending fulfillment |
materials by postal or electronic means to the policyholder or certificate holder. |
(4) The company shall disclose in the policy documentation and fulfillment materials |
whether the travel insurance is primary or secondary to other applicable coverage. |
(5) When travel insurance is marketed directly to a consumer through an insurer's website |
or by others through an aggregator site, it shall not be an unfair trade practice or other violation of |
law where an accurate summary or short description of coverage is provided on the website, so |
long as the consumer has access to the full provisions of the policy through electronic means. |
(d) No person offering, soliciting, or negotiating travel insurance or travel protection |
plans on an individual or group basis may do so by using a negative option or opt out, which |
would require a consumer to take an affirmative action to deselect coverage such as unchecking a |
box on an electronic form when they purchase a trip. |
(e) It shall be an unfair trade practice to market blanket travel insurance coverage as free. |
(f) When a consumer's destination jurisdiction requires insurance coverage, it shall not be |
an unfair trade practice to require that a consumer choose between the following options as a |
condition of purchasing a trip or travel package: |
(1) Purchasing the coverage required by the destination jurisdiction through the travel |
retailer or limited lines travel insurance producer supplying the trip or travel package; or |
(2) Agreeing to obtain and provide proof of coverage that meets the destination |
jurisdiction's requirements prior to departure. |
27-79.1-9. Travel administrators. |
(a) Notwithstanding any other provisions of this title, no person shall act or represent |
himself, herself, or itself as a travel administrator for travel insurance in this state unless that |
person: |
(1) Is a licensed property and casualty insurance producer in this state for activities |
permitted under that producer license; or |
(2) Holds a valid managing general agent license in this state. |
(b) A travel administrator and its employees are exempt from the licensing requirements |
of chapter 10 of title 27 for travel insurance it administers. |
(c) An insurer is responsible for the acts of a travel administrator administering travel |
insurance underwritten by the insurer, and is responsible for ensuring that the travel administrator |
maintains all books and records relevant to the insurer to be made available by the travel |
administrator to the commissioner upon request. |
27-79.1-10. Policy. |
(a) Notwithstanding any other provision of this title, travel insurance; shall be classified;, |
and filed for purposes of rates and forms under an inland marine line of insurance provided;, |
however, that travel insurance that provides coverage for sickness, accident, disability, or death |
occurring during travel, either exclusively or in conjunction with related coverages of emergency |
evacuation or repatriation of remains, or incidental limited property and casualty benefits such as |
baggage or trip cancellation, may be filed by an authorized insurer under either an accident and |
health line of insurance or an inland marine line of insurance. |
(b) Travel insurance may be in the form of an individual, group, or blanket policy. |
(c) Eligibility and underwriting standards for travel insurance may be developed and |
provided based on travel protection plans designed for individual or identified marketing or |
distribution channels, provided those standards also meet the state's underwriting standards for |
inland marine. |
27-79.1-11. Responsibility. |
As the insurer designee, the limited lines travel insurance producer is responsible for the |
acts of the travel retailer and shall use reasonable means to ensure compliance by the travel |
retailer with this chapter. |
27-79.1-12. Enforcement. |
Violations of this chapter shall be subject to penalties pursuant to § 42-14-16. |
27-79.1-13. Regulations. |
The commissioner may promulgate regulations to implement the provisions of this |
chapter. |
SECTION 3. This act shall take effect on October 1, 2019. |
======== |
LC000738/SUB A |
======== |