Connecticut Senate Bill SB00041

Connecticut 2019 Regular Session

• Introduced: 1/15/19
• Refer: 1/15/19

Caption

An Act Prohibiting Discretionary Clauses In Health Insurance And Disability Income Policies.

Impact

If enacted, this bill will significantly alter the landscape of health insurance and disability income policies in the state. By eliminating discretionary clauses, the legislation seeks to ensure that insurance companies cannot unilaterally determine what constitutes compliance with their own policy terms. This move is expected to foster fairer practices within the industry and increase accountability among insurance providers, ensuring that policyholders are treated consistently and justly under the terms of their agreements.

Summary

SB00041 is a proposed bill that seeks to prohibit the inclusion of discretionary clauses in health insurance and disability income policies. Specifically, the bill aims to prevent insurance companies, fraternal benefit societies, and health care centers operating within the state from including provisions in their policies that reserve excessive discretion for interpreting policy terms. This change is intended to establish clearer guidelines for how insurance claims are handled and to enhance consumer protections within the insurance sector.

Contention

However, the proposed bill may face opposition from insurance industry stakeholders who argue that discretionary clauses are necessary for providing flexibility in the interpretation of complex medical and legal terminology in policies. Critics of the bill may express concerns that removing such clauses could lead to unintended consequences, such as increased litigation or a reluctance from insurance companies to offer comprehensive coverage. Thus, discussions surrounding SB00041 are likely to address both the benefits of protecting consumers and the potential drawbacks for insurance providers.