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Regulatory News

ARIZONA
Department of Insurance says p-c insurers contribute $1.2 trillion to the state’s economy, more than 37,000 jobs, and $181.5 million in premium tax receipts. >> Legislature votes to privatize state workers compensation insurer beginning Jan. 1, 2013. The bill makes the State Compensation Fund a mutual, owning all of its assets and liabilities and subject to laws governing mutuals in the state. It awaits the governor’s signature.
www.id.state.az.us

ARKANSAS
Lowell Nicholas named special projects director. He will advise commissioner on topics including implementation of portions of federal healthcare reform. >> John Morris named deputy commissioner and general counsel. He was with the Tennessee Department of Commerce and Insurance.
www.insurance.arkansas.gov

COLORADO
Statehouse passes HB 10-1012, mandating a reasonable basis to suspect fraud or material misstatement to justify surveillance of a workers comp claimant. >> SB 10-012, which increases penalties for violations of medical prompt-pay statute and changes the language from “willingly” to “knowingly” violate, passes Senate and moves to House for consideration. >> Both houses pass HB 10-1394, which requires “the work of a construction professional that results in property damage, including damage to the work itself or other work, is an accident unless the property damage is intended and expected by the insured.” Opponents say the language would require a GL policy to function as a bond or warranty policy, covering the quality of the work instead of just consequential damage resulting from the work.
www.dora.state.co.us/insurance

CONNECTICUT
State Superior Court has found that Acordia, now owned by Wells Fargo, violated its fiduciary duties by not disclosing contingent commissions. This is the first case to go to trial on the issue of a brokerage having a duty to disclose such arrangements. The court also said in its decision that the brokerage didn’t alter its fees based on the contingent commissions and no harm was done to customers in Connecticut.
www.ct.gov/cid/site

FLORIDA
Gov. Crist signs bill allowing parents to sign waivers for “inherent risks” to children at theme parks, previously under a moratorium because the state didn’t have a law permitting them. Move offers some limited liability protection for the parks. >> Legislature passes omnibus insurance bill, SB 2004, that raises minimum capital requirements for insurers, allows more flexibility in passing reinsurance costs on to policyholders, protects independent agent commissions from state regulators, places a three-year limit on claim filing time after a hurricane, and allows the Office of Insurance Regulation to examine MGAs affiliated with insurers it regulates. The bill, which also addresses public adjusters, policy cancellations and other insurance concerns, awaits Gov. Crist’s signature. >> Legislature also passes SB 2176, a commercial lines deregulation bill, that exempts excess and umbrella, surety and fidelity, commercial auto, and D&O from the rate filing and approval process. They still, however, must develop rates that are not excessive, inadequate or unfairly discriminatory under legal standards. The bill is with the governor.
www.floir.com

GEORGIA
Statehouse passes bill allowing employers with injured workers whose workers comp insurer, Southeastern U.S. Insurance, went belly up before paying claims to join Georgia Insurers Insolvency Pool for claims coverage. The state Senate has a similar bill with higher employer buy-in fees: $20,000 per claim for employers with $25 million or less net worth, and $100,000 per claim for larger companies (compared to the House bill’s $5,000 for smaller and $20,000 for larger employers). The bills must be reconciled before going to the governor for signature.
www.inscomm.state.ga.us

LOUISIANA
State Senate passes SB 595, which prohibits insurers from increasing premiums or canceling/non-renewing policies because of Chinese drywall. >> HB 285, which exempts authorized surplus lines from filing rates and forms, passes House on unanimous vote. Surplus lines insurers must meet eligibility and financial requirements to be approved in the state.
www.ldi.state.la.us

MASSACHUSETTS
State Supreme Court rules that state law that voids lease provisions that require tenants to indemnify or exonerate landlords from liability for their own negligence doesn’t apply in a case when a commercial lease requires the tenant to provide liability coverage for the landlord. A requirement to buy insurance protection for a landlord isn’t the same as indemnifying or holding harmless, says judge.
http://www.mass.gov

MICHIGAN
Newly passed legislation requires any hostile takeover of small insurer be approved by two thirds of shareholders of target company rather than simple majority.
http://www.michigan.gov/dleg/0,1607,7-154-10555—-,00.html

MISSOURI
Gov. Jay Nixon has signed into law a requirement that health insurers pay or deny claims to doctors, hospital and other providers within 45 days of receipt. Suspension of claims no longer allowed. Overdue payments assessed daily penalty of 1% of the outstanding claim, payable to the healthcare provider.
www.insurance.mo.gov

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