House of Representatives
File No. 836
January Session, 2011
(Reprint of File No. 152)
As Amended by House
Amendment Schedule "A"
Approved by the Legislative Commissioner
May 23, 2011
Be it enacted by the Senate and House of Representatives in General Assembly convened:
Section 1. Section 38a-326 of the general statutes is repealed and the following is substituted in lieu thereof (Effective January 1, 2012):
(a) Whenever a policy for commercial [automobile insurance or general liability] risk insurance, as defined in section 38a-663, is nonrenewed or cancelled for [whatever] any reason by the insured or by the insurer, the insurer shall furnish the insured with written reports for the insured portion of the period beginning four years prior to the nonrenewal or cancellation date and ending six months prior to that date. Such reports shall include the following: (1) Each policy number; (2) each period of coverage provided; (3) evidence that the reports are furnished by the insurer; (4) written premiums; (5) pricing information as specified by regulations adopted pursuant to subsection (c) of this section and modifications used if requested by the insured; and (6) a detailed listing of incurred losses. If the policy is nonrenewed or cancelled by the insurer for reasons other than those permitting cancellation upon ten days' notice under section 38a-324, such reports shall be provided to the insured first named in the policy or the insured's authorized producer, not later than the date of notice of nonrenewal or cancellation. If the policy is nonrenewed or cancelled by the insured or cancelled by the insurer for any reason for which ten days' notice of cancellation is required under section 38a-324, such reports shall be provided [within sixty] not later than thirty days [of] after receipt of the written request from the insured first named in the policy or the insured's authorized producer. If subsequent reports updating the required information are needed to properly rate or to obtain insurance coverage with a different insurer, such reports shall be furnished by the prior insurer [within sixty] not later than thirty days [of] after receipt of a written request from the insured first named in the policy or the insured's authorized producer.
(b) An insurer shall provide, [upon] not later than thirty days after receipt of a written request by the principal named insured, a summary of policy claim information on a policy for commercial insurance for a period commencing not more than four years prior to the date of the request. Such information shall include the following: (1) Each policy number; (2) each period of coverage; (3) the number of claims; (4) the paid losses of all loss information; and (5) the date of each loss. For purposes of this subsection, "principal named insured" shall not include any additional named insured.
(c) The Insurance Commissioner may adopt regulations, in accordance with the provisions of chapter 54, as deemed necessary to implement the provisions of this section.
This act shall take effect as follows and shall amend the following sections:
October 1, 2011
The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.
OFA Fiscal Note
There is no fiscal impact to the state or municipalities as this bill relates only to loss run reporting requirements of private insurers.
House “A” changed the effective date of the underlying bill and changed the reporting requirements for commercial risk policies. There was no fiscal impact.
The Out Years
OLR Bill Analysis
By law, when insurers or insureds cancel or do not renew a commercial auto or general liability insurance policy, the insurer must provide their insureds with written reports that include a history of the policy's pricing and premium information, along with a detailed list of incurred losses (i.e., loss reports). This bill extends the reporting requirement to all types of commercial risk insurance, instead of just commercial auto or general liability, and decreases the timeframe for providing certain reports from 60 days to 30 days.
Additionally, under current law, commercial auto and general liability insurers must provide to principal insureds who request it, a summary of claims information for a period of up to four years before the date of the request. The bill (1) expands the requirement to all commercial risk insurers, (2) specifies that the request must be made in writing, and (3) requires the insurer to report within 30 days after receiving the request. By law, the summary report must include each policy number, each coverage period, the number of claims, the amount of paid losses, and the date of each loss.
*House Amendment “A” changes the original file (File 152) by (1) increasing the timeframe for providing claim loss reports from 10 days to 30 days, (2) eliminating a requirement that permitted an insured's authorized producer to submit a request for a claims summary report, and (3) changes the effective date from October 1, 2011 to January 1, 2012.
EFFECTIVE DATE: January 1, 2012
TIMEFRAME TO FURNISH LOSS REPORT
Under current law, when the cancellation or nonrenewal of a policy is due to specified circumstances (e.g., nonpayment of premium, fraud or material misrepresentation, or willful or reckless acts that increase the hazard insured against), the insurer must provide the loss report, or an updated report needed to properly rate or obtain coverage from a different insurer, to the insured within 60 days of receiving a written request from the insured or the insured's authorized producer. The bill decreases the timeframe to report from 60 days to 30 days.
An insurer that cancels or does not renew a policy for any other reason than those specified must provide the insured or authorized producer with the loss report no later than the date notice of nonrenewal or cancellation is furnished.
Insurance and Real Estate Committee