Connecticut Seal

General Assembly

Amendment

 

February Session, 2018

LCO No. 3405

   
 

*SB0037703405SDO*

Offered by:

 

SEN. LARSON, 3rd Dist.

 

To: Subst. Senate Bill No. 377

File No. 336

Cal. No. 208

"AN ACT AUTHORIZING AGENCY CAPTIVE INSURANCE COMPANIES."

After the last section, add the following and renumber sections and internal references accordingly:

"Sec. 501. (NEW) (Effective July 1, 2018) (a) For the purposes of this section:

(1) "Mortgage loan" means a loan secured by a mortgage on one, two, three or four family residential real property located in this state, including, but not limited to, a residential unit in any (A) common interest community, as defined in section 47-202 of the general statutes, or (B) condominium, as defined in section 47-68a of the general statutes;

(2) "Mortgagee" means a mortgage lender authorized to originate mortgage loans in this state that is the grantee of a mortgage as part of a mortgage loan; and

(3) "Mortgagor" means the grantor of a mortgage as part of a mortgage loan.

(b) Each mortgagee that makes a mortgage loan shall collect a surcharge of ten dollars per mortgage loan from the mortgagor at closing. The mortgagee shall remit to the Banking Commissioner, not later than March fifteenth annually, all such surcharges collected during the calendar year next preceding and shall include with such remittance, in a form and manner prescribed by the commissioner, documentation to substantiate the surcharge amount remitted.

(c) All such remittances collected shall be deposited in the Crumbling Foundations Assistance Fund established pursuant to section 8-441 of the general statutes.

(d) The Banking Commissioner may adopt regulations, in accordance with the provisions of chapter 54 of the general statutes, to carry out the purposes of this section.

(e) The surcharge required under subsection (b) of this section shall terminate on June 30, 2025.

Sec. 502. (NEW) (Effective July 1, 2018) (a) Each admitted and nonadmitted insurer that delivers, issues for delivery, renews, amends or endorses a homeowners insurance policy, a renter's insurance policy, a condominium unit owners insurance policy or a master policy that is required to be purchased by a condominium association pursuant to section 47-83 of the general statutes or by a unit owners' association pursuant to section 47-255 of the general statutes on or after July 1, 2018, on any property or risks located or resident in this state, shall: (1) Pay a fee of ten dollars per policy; and (2) collect a surcharge of ten dollars per policy from the named insured. Such insurer shall state the surcharge separately on a billing notice or policy declaration or in a document provided to the named insured under such policy. In no event shall the surcharge be considered premium for the issuance of such insurance policy.

(b) (1) For each insurance policy subject to subsection (a) of this section delivered, issued for delivery, renewed, amended or endorsed by an admitted insurer, the admitted insurer shall remit to the Insurance Commissioner, not later than March fifteenth annually, all such fees and surcharges collected during the calendar year next preceding and shall include with such remittance, in a form and manner prescribed by the commissioner, documentation to substantiate the fee and surcharge amount remitted.

(2) For each insurance policy subject to subsection (a) of this section delivered, issued for delivery, renewed, amended or endorsed by a nonadmitted insurer, the licensee who procured, continued or renewed such coverage shall remit to the Insurance Commissioner, on or before February fifteenth annually, all such fees and surcharges collected during the calendar year next preceding and shall include with such remittance, in a form and manner prescribed by the commissioner, documentation to substantiate the fee and surcharge amount remitted. For purposes of this subdivision, "licensee" has the same meaning as provided in subsection (b) of section 38a-743 of the general statutes.

(c) All such remittances collected shall be deposited in the Crumbling Foundations Assistance Fund established pursuant to section 8-441 of the general statutes.

(d) The Insurance Commissioner may adopt regulations, in accordance with the provisions of chapter 54 of the general statutes, to carry out the purposes of this section.

(e) The fee and surcharge required under subsection (a) of this section shall terminate on June 30, 2025.

Sec. 503. Subsection (c) of section 38a-743 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(c) (1) (A) With respect to nonadmitted insurance, where such coverage is procured, continued or renewed for an insured by a licensee on or after July 1, 2011, and where this state is an insured's home state, such licensee shall pay a tax equal to the sum of four per cent of the gross premiums charged such insureds by nonadmitted insurers, irrespective of the fact that the insurance policy may cover properties, risks or exposures located or to be performed both within and without this state.

(B) With respect to nonadmitted insurance of the type specified under subsection (a) of section 502 of this act, where such coverage is procured, continued or renewed for an insured by a licensee on or after July 1, 2018, such licensee shall pay, in accordance with subdivision (3) of this subsection, the fee and surcharge required under subsection (a) of section 502 of this act.

(2) (A) For the period beginning on July 1, 2011, and ending September 30, 2011, each licensee shall pay to the Insurance Commissioner, on or before November 15, 2011, in accordance with procedures established and on forms provided by said commissioner, a tax on nonadmitted insurance equal to the sum of four per cent of the gross premiums charged insureds by nonadmitted insurers during such period.

(B) For the period beginning on October 1, 2011, and ending December 31, 2011, each licensee shall pay to the Insurance Commissioner, on or before February 15, 2012, in accordance with procedures established and on forms provided by said commissioner, a tax on nonadmitted insurance equal to the sum of four per cent of the gross premiums charged insureds by nonadmitted insurers during such period.

(3) For calendar years beginning on or after January 1, 2012, each licensee shall pay to the Insurance Commissioner, in accordance with procedures established and on forms provided by said commissioner, (A) on or before May fifteenth of each year in which nonadmitted insurance was procured, continued or renewed, a tax on such insurance equal to the sum of four per cent of the gross premiums charged insureds by nonadmitted insurers during the period from January first to March thirty-first of that year; (B) on or before August fifteenth of each year in which nonadmitted insurance was procured, continued or renewed, a tax on such insurance equal to the sum of four per cent of the gross premiums charged insureds by nonadmitted insurers during the period from April first to June thirtieth of that year; (C) on or before November fifteenth of each year in which nonadmitted insurance was procured, continued or renewed, a tax on such insurance equal to the sum of four per cent of the gross premiums charged insureds by nonadmitted insurers during the period from July first to September thirtieth of that year; and (D) (i) on or before February fifteenth of each year succeeding a year in which nonadmitted insurance was procured, continued or renewed, a tax on such insurance equal to the sum of four per cent of the gross premiums charged insureds by nonadmitted insurers during the period from October first to December thirty-first of the preceding year, and (ii) beginning July 1, 2018, on or before February fifteenth of each year succeeding a year in which nonadmitted insurance of the type specified under subsection (a) of section 502 of this act was procured, continued or renewed, the fee and surcharge required under said subsection.

(4) In the event of cancellation and rewriting of any nonadmitted insurance contract, the premium for purposes of this subsection shall be the premium in excess of the unearned premium of the cancelled insurance contract.

(5) If, pursuant to subsection (g) of this section, the Insurance Commissioner enters into a cooperative or reciprocal agreement with another state or states, and if the provisions set forth in such agreement are different from provisions prescribed by this subsection, then the provisions set forth in such agreement shall prevail.

Sec. 504. Section 38a-307 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018, and applicable to policies delivered, issued for delivery, renewed, amended or endorsed on or after said date):

Except as provided in section 38a-307a, the standard form of fire insurance policy of the state of Connecticut, with permission to substitute for the word "Company" a more accurate descriptive term of the type of insurer, shall be as follows:

[Space for insertion of name of company or companies issuing the policy and other matter permitted to be stated at the head of the policy.]

[Space for listing amounts of insurance, rates and premiums for the basic coverages insured under the standard form of policy and for additional coverages or perils insured under endorsements attached.]

T1

In Consideration of the Provisions and Stipulations

T2

Herein or Added Hereto

T3

AND OF ................................................................. DOLLARS PREMIUM

T4

this company, for the term

}

from the .... day of .... 20..

{

at noon,

T5

   

Standard Time, at

T6

   

location of

T7

of ....

to the .... day of .... 20..

property involved

T8

to an amount not exceeding .................................................................................................. Dollars,

T9

does insure ..............................................................................................................................................

and legal representatives, to the extent of the actual cash value of the property at the time of loss, but not exceeding the amount which it would cost to repair or replace the property with material of [like kind and] quality sufficient to fulfill their intended purposes within a reasonable time after such loss, without allowance for any increased cost of repair or reconstruction by reason of any ordinance or law regulating construction or repair, and without compensation for loss resulting from interruption of business or manufacture, nor in any event for more than the interest of the insured, against all DIRECT LOSS BY FIRE, LIGHTNING AND BY REMOVAL FROM PREMISES ENDANGERED BY THE PERILS INSURED AGAINST IN THIS POLICY, EXCEPT AS HEREINAFTER PROVIDED, to the property described hereinafter while located or contained as described in this policy, or pro rata for five days at each proper place to which any of the property shall necessarily be removed for preservation from the perils insured against in this policy, but not elsewhere. The actual cash value at the time of loss for a building described herein shall be the amount which it would cost to repair or replace such building with material of [like kind and] quality sufficient to fulfill their intended purposes, minus reasonable depreciation. As used herein, "depreciation" means a decrease in value of real property over a period of time due to wear and tear.

Assignment of this policy shall not be valid except with the written consent of this Company.

This policy is made and accepted subject to the foregoing provisions and stipulations and those hereinafter stated, which are hereby made a part of this policy, together with such other provisions, stipulations and agreements as may be added hereto, as provided in this policy.

In Witness Whereof, this Company has executed and attested these presents.

.... (Secretary).

.... (President).

Concealment, fraud. This entire policy shall be void if, whether before or after a loss, the insured has wilfully concealed or misrepresented any material fact or circumstance concerning this insurance or the subject thereof, or the interest of the insured therein, or in case of any fraud or false swearing by the insured relating thereto.

Uninsurable and excepted property. This policy shall not cover accounts, bills, currency, deeds, evidences of debt, money or securities; nor, unless specifically named hereon in writing, bullion or manuscripts.

Perils not included. This Company shall not be liable for loss by fire or other perils insured against in this policy caused, directly or indirectly, by: (a) Enemy attack by armed forces, including action taken by military, naval or air forces in resisting an actual or an immediately impending enemy attack; (b) invasion; (c) insurrection; (d) rebellion; (e) revolution; (f) civil war; (g) usurped power; (h) order of any civil authority except acts of destruction at the time of and for the purpose of preventing the spread of fire, provided that such fire did not originate from any of the perils excluded by this policy; (i) neglect of the insured to use all reasonable means to save and preserve the property at and after a loss, or when the property is endangered by fire in neighboring premises; (j) nor shall this Company be liable for loss by theft.

Other Insurance. Other insurance may be prohibited or the amount of insurance may be limited by endorsement attached hereto.

Conditions suspending or restricting insurance. Unless otherwise provided in writing added hereto this Company shall not be liable for loss occurring (a) while the hazard is increased by any means within the control or knowledge of the insured; or (b) while a described building, whether intended for occupancy by owner or tenant, is vacant or unoccupied beyond a period of sixty consecutive days; or (c) as a result of explosion or riot, unless fire ensue, and in that event for loss by fire only.

Other perils or subjects. Any other peril to be insured against or subject of insurance to be covered in this policy shall be by endorsement in writing hereon or added hereto.

Added provisions. The extent of the application of insurance under this policy and of the contribution to be made by this Company in case of loss, and any other provision or agreement not inconsistent with the provisions of this policy, may be provided for in writing added hereto, but no provision may be waived except such as by the terms of this policy is subject to change.

Waiver provisions. No permission affecting this insurance shall exist, or waiver of any provision be valid, unless granted herein or expressed in writing added hereto. No provision, stipulation or forfeiture shall be held to be waived by any requirement or proceeding on the part of this Company relating to appraisal or to any examination provided for herein.

Cancellation of policy. This policy shall be cancelled at any time at the request of the insured, in which case this Company shall, upon demand and surrender of this policy, refund the excess of paid premium above the customary short rates for the expired time. This policy may be cancelled at any time by this Company by giving to the insured and any third party designated pursuant to section 38a-323a, a thirty days' written notice of cancellation accompanied by the reason therefor with or without tender of the excess of paid premium above the pro rata premium for the expired time, which excess, if not tendered, shall be refunded on demand. Notice of cancellation shall state that said excess premium (if not tendered) will be refunded on demand. Where cancellation is for nonpayment of premium at least ten days' written notice of cancellation accompanied by the reason therefor shall be given.

Mortgagee interests and obligations. If loss hereunder is made payable, in whole or in part, to a designated mortgagee not named herein as the insured, such interest in this policy may be cancelled by giving to such mortgagee a ten days' written notice of cancellation.

If the insured fails to render proof of loss such mortgagee, upon notice, shall render proof of loss in the form herein specified within [sixty (60)] one hundred twenty (120) days thereafter and shall be subject to the provisions hereof relating to appraisal and time of payment and of bringing suit. If this Company shall claim that no liability existed as the mortgagor or owner, it shall, to the extent of payment of loss to the mortgagee, be subrogated to all the mortgagee's rights of recovery, but without impairing mortgagee's right to sue; or it may pay off the mortgage debt and require an assignment thereof and of the mortgage. Other provisions relating to the interests and obligations of such mortgagee may be added hereto by agreement in writing.

Pro rata liability. This Company shall not be liable for a greater proportion of any loss than the amount hereby insured shall bear to the whole insurance covering the property against the peril involved, whether collectible or not.

Requirements in case loss occurs. The insured shall give immediate written notice to this Company of any loss, protect the property from further damage, forthwith separate the damaged and undamaged personal property, put it in the best possible order, furnish a complete inventory of the destroyed, damaged and undamaged property, showing in detail quantities, costs, actual cash value and amount of loss claims; AND WITHIN [SIXTY] ONE HUNDRED TWENTY DAYS AFTER THE LOSS, UNLESS SUCH TIME IS EXTENDED IN WRITING BY THIS COMPANY, THE INSURED SHALL RENDER TO THIS COMPANY A PROOF OF LOSS, signed and sworn to by the insured, stating the knowledge and belief of the insured as to the following: The time and origin of the loss, the interest of the insured and of all others in the property, the actual cash value of each item thereof and the amount of loss thereto, all encumbrances thereon, all other contracts of insurance, whether valid or not, covering any of said property, any changes in the title, use, occupation, location, possession or exposures of said property since the issuing of this policy, by whom and for what purpose any building herein described and the several parts thereof were occupied at the time of loss and whether or not it then stood on leased ground, and shall furnish a copy of all the descriptions and schedules in all policies and, if required, verified plans and specification of any building, fixtures or machinery destroyed or damaged. The insured, as often as may be reasonably required, shall exhibit to any person designated by this Company all that remains of any property herein described, and submit to examinations under oath by any person named by this Company, and subscribe the same; and, as often as may be reasonably required, shall produce for examination all books of account, bills, invoices and other vouchers, or certified copies thereof if originals be lost, at such reasonable time and place as may be designated by this Company or its representative, and shall permit extracts and copies thereof to be made.

Appraisal. In case the insured and this Company shall fail to agree as to the actual cash value or the amount of loss, then, on the written demand of either, each shall select a competent and disinterested appraiser and notify the other of the appraiser selected within twenty days of such demand. The appraisers shall first select a competent and disinterested umpire; and failing for fifteen days to agree upon such umpire, then, on request of the insured or this Company, such umpire shall be selected by a judge of a court of record in this state in which the property covered is located. The appraisers shall then appraise the loss, stating separately actual cash value and loss to each item; and, failing to agree, shall submit their differences, only, to the umpire. An award in writing, so itemized, of any two when filed with this Company shall determine the amount of actual cash value and loss. Each appraiser shall be paid by the party selecting him and the expenses of appraisal and umpire shall be paid by the parties equally.

Company's options. It shall be optional with this Company to take all, or any part, of the property at the agreed or appraised value, and also to repair, rebuild or replace the property destroyed or damaged with other of [like kind and] quality sufficient to fulfill their intended purposes within a reasonable time, on giving notice of its intention so to do within thirty days after the receipt of the proof of loss herein required.

Abandonment. There can be no abandonment to this Company of any property.

When loss payable. The amount of loss for which this Company may be liable shall be payable thirty days after proof of loss, as herein provided, is received by this Company and ascertainment of the loss is made either by agreement between the insured and this Company expressed in writing or by the filing with this Company of an award as herein provided. This Company and the insured may agree in writing to a partial payment of the amount of loss as an advance payment. Any advance payment shall be credited against the total amount of loss due to the insured. An advance payment shall not affect the requirement of this Company to pay the total amount of loss not later than thirty days after proof of loss.

Suit. No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or equity unless all the requirements of this policy shall have been complied with, and unless commenced within [twenty-four] forty-eight months next after [inception of the loss] denial of the claim.

Subrogation. This Company may require from the insured an assignment of all right of recovery against any party for loss to the extent that payment therefor is made by this Company."

This act shall take effect as follows and shall amend the following sections:

Sec. 501

July 1, 2018

New section

Sec. 502

July 1, 2018

New section

Sec. 503

July 1, 2018

38a-743(c)

Sec. 504

July 1, 2018, and applicable to policies delivered, issued for delivery, renewed, amended or endorsed on or after said date

38a-307