SENATE BILL 25-058
BY SENATOR(S) Snyder, Michaelson Jenet, Mullica;
also REPRESENTATIVE(S) Rydin and Gonzalez R., Bacon, Brown,
Clifford, Duran, Hamrick, Keltie, Marshall.
C
ONCERNING A MODEL ACT TO PROVIDE A FRAMEWORK THAT ALLOWS
INSURANCE COMPANIES TO GIVE REBATES THAT MEET SPECIFIED
CRITERIA TO MAINTAIN CONSUMER PROTECTIONS
.
Be it enacted by the General Assembly of the State of Colorado:
SECTION 1. In Colorado Revised Statutes, 10-3-1104, amend
(1)(g) and (2) introductory portion; and add (2)(e), (2.1), (2.2), (2.3), (2.4),
(2.5), (2.6), (2.7), and (6) as follows:
10-3-1104. Unfair methods of competition - unfair or deceptive
practices - rules - definitions. (1) The following are defined as unfair
methods of competition and unfair or deceptive acts or practices in the
business of insurance:
(g) Rebates: Except as
OTHERWISE PROVIDED IN THIS SECTION AND
AS
otherwise expressly provided by law, knowingly permitting, or offering
to make, or making any contract of insurance or agreement as to such
NOTE: This bill has been prepared for the signatures of the appropriate legislative
officers and the Governor. To determine whether the Governor has signed the bill
or taken other action on it, please consult the legislative status sheet, the legislative
history, or the Session Laws.
________
Capital letters or bold & italic numbers indicate new material added to existing law; dashes
through words or numbers indicate deletions from existing law and such material is not part of
the act. contract, other than as plainly expressed in the insurance contract issued
thereon, or paying, or allowing, or giving, or offering to pay, allow, or give,
directly or indirectly, as inducement to such insurance or annuity, any rebate
of premiums payable on the contract, or any special favor or advantage in
the dividends or other benefits thereon
ON THE CONTRACT OR ANNUITY , or
any valuable consideration or inducement whatever not specified in the
contract; or giving, or
selling, or purchasing, or offering to give, sell, or
purchase, as inducement to such insurance contract or annuity or in
connection therewith
WITH THE INSURANCE CONTRACT OR ANNUITY , any
stocks, bonds, or other securities of any insurance company or other
corporation, association, or partnership, or any dividends or profits accrued
thereon
ON THE STOCKS, BONDS, OR OTHER SECURITIES, or anything of value
whatsoever not specified in the contract;
(2) Nothing in paragraph (f) or (g) of subsection (1) SUBSECTION
(1)(f) OR (1)(g) of this section shall be construed as including within the
definition of discrimination or rebates any of the following practices:
(e) O
FFERING OR PROVIDING, BY OR THROUGH AN EMPLOYEE ,
AFFILIATE, OR THIRD-PARTY REPRESENTATIVE OF AN INSURER OR INSURANCE
PRODUCER
, A VALUE-ADDED PRODUCT OR SERVICE AT NO COST OR REDUCED
COST
, WHEN THE PRODUCT OR SERVICE IS NOT SPECIFIED IN THE INSURANCE
POLICY
, IF THE PRODUCT OR SERVICE:
(I) R
ELATES TO THE INSURANCE COVERAGE ; AND
(II) IS PRIMARILY AIMED TO ACHIEVE ONE OR MORE OF THE
FOLLOWING
:
(A) P
ROVIDE LOSS MITIGATION OR LOSS CONTROL ;
(B) R
EDUCE CLAIM COSTS OR CLAIM SETTLEMENT COSTS ;
(C) P
ROVIDE EDUCATION ABOUT LIABILITY RISK OR RISK OF LOSS TO
INDIVIDUALS OR PROPERTY
;
(D) M
ONITOR OR ASSESS RISK, IDENTIFY SOURCES OF RISK, OR
DEVELOP STRATEGIES FOR ELIMINATING OR REDUCING RISK
;
(E) E
NHANCE HEALTH;
PAGE 2-SENATE BILL 25-058 (F) PROMOTE FINANCIAL WELLNESS THROUGH ITEMS SUCH AS
EDUCATIONAL OR FINANCIAL PLANNING SERVICES
;
(G) P
ROVIDE POST-LOSS SERVICES;
(H) E
NCOURAGE BEHAVIORAL CHANGES TO IMPROVE THE HEALTH OR
REDUCE THE RISK OF DEATH OR DISABILITY OF A CUSTOMER
; OR
(I) ASSIST IN THE ADMINISTRATION OF EMPLOYEE OR RETIREE
BENEFIT INSURANCE COVERAGE
.
(2.1) T
HE COST TO AN INSURER OR INSURANCE PRODUCER OFFERING
A PRODUCT OR SERVICE TO A CUSTOMER PURSUANT TO SUBSECTION
(2)(e)
OF THIS SECTION MUST BE REASONABLE IN COMPARISON TO THAT
CUSTOMER
'S PREMIUMS OR INSURANCE COVERAGE .
(2.2) I
F AN INSURER OR INSURANCE PRODUCER IS OFFERING A
PRODUCT OR SERVICE PURSUANT TO SUBSECTION
(2)(e) OF THIS SECTION,
THE INSURER OR INSURANCE PRODUCER SHALL PROVIDE A CUSTOMER WITH
CONTACT INFORMATION TO ASSIST THE CUSTOMER WITH QUESTIONS
REGARDING THE PRODUCT OR SERVICE
.
(2.3) T
O ENSURE CONSUMER PROTECTION WHILE IMPLEMENTING THE
PERMITTED PRACTICES SET FORTH IN SUBSECTION
(2) OF THIS SECTION, THE
COMMISSIONER MAY ADOPT RULES TO IMPLEMENT AND ENFORCE
SUBSECTIONS
(2) TO (2.7) OF THIS SECTION.
(2.4) T
HE AVAILABILITY OF A PRODUCT OR SERVICE OFFERED
PURSUANT TO SUBSECTION
(2)(e) OF THIS SECTION MUST BE:
(a) B
ASED ON DOCUMENTED , OBJECTIVE CRITERIA THAT IS
MAINTAINED BY THE INSURER OR INSURANCE PRODUCER AND MUST BE
PRODUCED UPON REQUEST BY THE DIVISION
; AND
(b) OFFERED IN A MANNER THAT IS NOT UNFAIRLY DISCRIMINATORY .
(2.5) (a) I
F AN INSURER OR INSURANCE PRODUCER DOES NOT HAVE
SUFFICIENT EVIDENCE BUT HAS A GOOD FAITH BELIEF THAT A PR ODUCT OR
SERVICE MEETS THE CRITERIA SET FORTH IN SUBSECTIONS
(2)(e)(II)(A) TO
(2)(e)(II)(I) OF THIS SECTION, THE INSURER OR INSURANCE PRODUCER SHALL
PAGE 3-SENATE BILL 25-058 PROVIDE THE PRODUCT OR SERVICE IN A MANNER THAT IS NOT UNFAIRLY
DISCRIMINATORY AS PART OF A PILOT OR TESTING PROGRAM FOR NO MORE
THAN ONE YEAR
.
(b) (I) A
N INSURER OR INSURANCE PRODUCER SHALL NOTIFY AND
RECEIVE APPROVAL FROM THE DIVISION FOR A PILOT OR TESTING PROGRAM
PRIOR TO LAUNCHING THE PROGRAM
.
(II) T
HE DIVISION SHALL APPROVE OR DENY A PILOT OR TESTING
PROGRAM NO LATER THAN THIRTY DAYS AFTER RECEIVING NOTIFICATION
PURSUANT TO SUBSECTION
(2.5)(b)(I) OF THIS SECTION.
(2.6) (a) A
N INSURER OR INSURANCE PRODUCER MAY :
(I) O
FFER OR GIVE A NONCASH GIFT, ITEM, OR SERVICE, INCLUDING
A MEAL OR CHARITABLE DONATION
, TO OR ON BEHALF OF A CUSTOMER IN
CONNECTION WITH THE MARKETING
, SALE, PURCHASE, OR RETENTION OF AN
INSURANCE CONTRACT IF THE COST DOES NOT EXCEED AN AMOUNT
DETERMINED TO BE REASONABLE BY THE COMMISSIONER PER POLICY YEAR
PER TERM
; OR
(II) OFFER OR GIVE A NONCASH GIFT, ITEM, OR SERVICE, INCLUDING
A MEAL OR CHARITABLE DONATION
, TO OR ON BEHALF OF A CUSTOMER ,
INCLUDING A COMMERCIAL OR INSTITUTIONAL CUSTOMER , IN CONNECTION
WITH THE MARKETING
, SALE, PURCHASE, OR RETENTION OF AN INSURANCE
CONTRACT IF
:
(A) T
HE COST IS REASONABLE IN COMPARISON TO THE PREMIUM OR
PROPOSED PREMIUM
; AND
(B) THE COST OF THE GIFT, ITEM, OR SERVICE IS NOT INCLUDED IN
ANY AMOUNT CHARGED TO ANOTHER PERSON OR ENTITY
.
(b) (I) A
NY OFFER OR GIFT MADE PURSUANT TO THIS SUBSECTION
(2.6) MUST BE OFFERED IN A MANNER THAT IS NOT UNFAIRLY
DISCRIMINATORY
.
(II) A
N INSURER OR INSURANCE PRODUCER SHALL NOT REQUIRE A
CUSTOMER TO PURCHASE
, CONTINUE, OR RENEW AN INSURANCE POLICY IN
EXCHANGE FOR A GIFT
, ITEM, OR SERVICE RECEIVED PURSUANT TO THIS
PAGE 4-SENATE BILL 25-058 SUBSECTION (2.6).
(2.7) E
XCEPT AS APPLIED TO AN INSURER OR INSURANCE PRODUCER 'S
OFFER OF A VALUE
-ADDED PRODUCT OR SERVICE , AN INSURER OR INSURANCE
PRODUCER SHALL NOT
:
(a) O
FFER OR PROVIDE INSURANCE AS AN INDUCEMENT TO THE
PURCHASE OF ANOTHER POLICY
; OR
(b) USE THE WORDS "FREE" OR "NO COST" OR WORDS OF SIMILAR
IMPORT IN AN ADVERTISEMENT
.
(6) A
S USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE
REQUIRES
:
(a) "C
USTOMER" INCLUDES A POLICYHOLDER , POTENTIAL
POLICYHOLDER
, CERTIFICATE HOLDER, POTENTIAL CERTIFICATE HOLDER ,
INSURED, POTENTIAL INSURED, OR APPLICANT.
(b) "I
NSURANCE PRODUCER " HAS THE MEANING SET FORTH IN
SECTION
10-2-103 (6).
SECTION 2. Act subject to petition - effective date -
applicability. (1) This act takes effect at 12:01 a.m. on the day following
the expiration of the ninety-day period after final adjournment of the
general assembly; except that, if a referendum petition is filed pursuant to
section 1 (3) of article V of the state constitution against this act or an item,
section, or part of this act within such period, then the act, item, section, or
part will not take effect unless approved by the people at the general
election to be held in November 2026 and, in such case, will take effect on
the date of the official declaration of the vote thereon by the governor.
PAGE 5-SENATE BILL 25-058 (2) This act applies to conduct occurring on or after the applicable
effective date of this act.
____________________________ ____________________________
James Rashad Coleman, Sr. Julie McCluskie
PRESIDENT OF SPEAKER OF THE HOUSE
THE SENATE OF REPRESENTATIVES
____________________________ ____________________________
Esther van Mourik Vanessa Reilly
SECRETARY OF CHIEF CLERK OF THE HOUSE
THE SENATE OF REPRESENTATIVES
APPROVED________________________________________
(Date and Time)
_________________________________________
Jared S. Polis
GOVERNOR OF THE STATE OF COLORADO
PAGE 6-SENATE BILL 25-058