Substitute Senate Bill No. 841
Public Act No. 21-137
AN ACT CONCERNING THE INSURANCE DEPARTMENT'S
RECOMMENDED CHANGES TO THE INSURANCE STATUTES.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 38a-1 of the general statutes is repealed and the
following is substituted in lieu thereof (Effective October 1, 2021):
Terms used in this title and sections 2 and 4 of this act, unless it
appears from the context to the contrary, shall have a scope and
meaning as set forth in this section.
(1) "Affiliate" or "affiliated" means a person that directly, or indirectly
through one or more intermediaries, controls, is controlled by or is
under common control with another person.
(2) "Alien insurer" means any insurer that has been chartered by or
organized or constituted within or under the laws of any jurisdiction or
country without the United States.
(3) "Annuities" means all agreements to make periodical payments
where the making or continuance of all or some of the series of the
payments, or the amount of the payment, is dependent upon the
continuance of human life or is for a specified term of years. This
definition does not apply to payments made under a policy of life Substitute Senate Bill No. 841
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insurance.
(4) "Commissioner" means the Insurance Commissioner.
(5) "Control", "controlled by" or "under common control with" means
the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a person, whether through
the ownership of voting securities, by contract other than a commercial
contract for goods or nonmanagement services, or otherwise, unless the
power is the result of an official position with the person.
(6) "Domestic insurer" means any insurer that has been chartered by,
incorporated, organized or constituted within or under the laws of this
state.
(7) "Domestic surplus lines insurer" means any domestic insurer that
has been authorized by the commissioner to write surplus lines
insurance.
(8) "Foreign country" means any jurisdiction not in any state, district
or territory of the United States.
(9) "Foreign insurer" means any insurer that has been chartered by or
organized or constituted within or under the laws of another state or a
territory of the United States.
(10) "Insolvency" or "insolvent" means, for any insurer, that it is
unable to pay its obligations when they are due, or when its admitted
assets do not exceed its liabilities plus the greater of: (A) Capital and
surplus required by law for its organization and continued operation;
or (B) the total par or stated value of its authorized and issued capital
stock. For purposes of this subdivision "liabilities" shall include but not
be limited to reserves required by statute or by regulations adopted by
the commissioner in accordance with the provisions of chapter 54 or
specific requirements imposed by the commissioner upon a subject Substitute Senate Bill No. 841
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company at the time of admission or subsequent thereto.
(11) "Insurance" means any agreement to pay a sum of money,
provide services or any other thing of value on the happening of a
particular event or contingency or to provide indemnity for loss in
respect to a specified subject by specified perils in return for a
consideration. In any contract of insurance, an insured shall have an
interest which is subject to a risk of loss through destruction or
impairment of that interest, which risk is assumed by the insurer and
such assumption shall be part of a general scheme to distribute losses
among a large group of persons bearing similar risks in return for a
ratable contribution or other consideration.
(12) "Insurer" or "insurance company" includes any person or
combination of persons doing any kind or form of insurance business
other than a fraternal benefit society, and shall include a receiver of any
insurer when the context reasonably permits.
(13) "Insured" means a person to whom or for whose benefit an
insurer makes a promise in an insurance policy. The term includes
policyholders, subscribers, members and beneficiaries. This definition
applies only to the provisions of this title and does not define the
meaning of this word as used in insurance policies or certificates.
(14) "Life insurance" means insurance on human lives and insurances
pertaining to or connected with human life. The business of life
insurance includes granting endowment benefits, granting additional
benefits in the event of death by accident or accidental means, granting
additional benefits in the event of the total and permanent disability of
the insured, and providing optional methods of settlement of proceeds.
Life insurance includes burial contracts to the extent provided by
section 38a-464.
(15) "Mutual insurer" means any insurer without capital stock, the Substitute Senate Bill No. 841
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managing directors or officers of which are elected by its members.
(16) "Person" means an individual, a corporation, a partnership, a
limited liability company, an association, a joint stock company, a
business trust, an unincorporated organization or other legal entity.
(17) "Policy" means any document, including attached endorsements
and riders, purporting to be an enforceable contract, which
memorializes in writing some or all of the terms of an insurance
contract.
(18) "State" means any state, district, or territory of the United States.
(19) "Subsidiary" of a specified person means an affiliate controlled
by the person directly, or indirectly through one or more intermediaries.
(20) "Unauthorized insurer" or "nonadmitted insurer" means an
insurer that has not been granted a certificate of authority by the
commissioner to transact the business of insurance in this state or an
insurer transacting business not authorized by a valid certificate.
(21) "United States" means the United States of America, its territories
and possessions, the Commonwealth of Puerto Rico and the District of
Columbia.
Sec. 2. (NEW) (Effective October 1, 2021) No insurer, health care center
or fraternal benefit society doing business in this state shall:
(1) In connection with the issuance, withholding, extension or
renewal of an annuity or an insurance policy for life, credit life,
disability, long-term care, accidental injury, specified disease, hospital
indemnity or credit accident insurance, request, require, purchase or use
information obtained from an entity providing direct-to-consumer
genetic testing without the informed written consent of the individual
who has been tested; or Substitute Senate Bill No. 841
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(2) Condition insurance rates, the provision or renewal of insurance
coverage or benefit or other conditions of insurance for an individual
on:
(A) Any requirement or agreement that the individual undergo
genetic testing; or
(B) The results of any genetic testing of a member of the individual's
family unless the results are contained in the individual's medical
record.
Sec. 3. Section 38a-816 of the general statutes is repealed and the
following is substituted in lieu thereof (Effective October 1, 2021):
The following are defined as unfair methods of competition and
unfair and deceptive acts or practices in the business of insurance:
(1) Misrepresentations and false advertising of insurance policies.
Making, issuing or circulating, or causing to be made, issued or
circulated, any estimate, illustration, circular or statement, sales
presentation, omission or comparison which: (A) Misrepresents the
benefits, advantages, conditions or terms of any insurance policy; (B)
misrepresents the dividends or share of the surplus to be received, on
any insurance policy; (C) makes any false or misleading statements as
to the dividends or share of surplus previously paid on any insurance
policy; (D) is misleading or is a misrepresentation as to the financial
condition of any person, or as to the legal reserve system upon which
any life insurer operates; (E) uses any name or title of any insurance
policy or class of insurance policies misrepresenting the true nature
thereof; (F) is a misrepresentation, including, but not limited to, an
intentional misquote of a premium rate, for the purpose of inducing or
tending to induce to the purchase, lapse, forfeiture, exchange,
conversion or surrender of any insurance policy; (G) is a
misrepresentation for the purpose of effecting a pledge or assignment of Substitute Senate Bill No. 841
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or effecting a loan against any insurance policy; or (H) misrepresents
any insurance policy as being shares of stock.
(2) False information and advertising generally. Making, publishing,
disseminating, circulating or placing before the public, or causing,
directly or indirectly, to be made, published, disseminated, circulated or
placed before the public, in a newspaper, magazine or other publication,
or in the form of a notice, circular, pamphlet, letter or poster, or over any
radio or television station, or in any other way, an advertisement,
announcement or statement containing any assertion, representation or
statement with respect to the business of insurance or with respect to
any person in the conduct of his insurance business, which is untrue,
deceptive or misleading.
(3) Defamation. Making, publishing, disseminating or circulating,
directly or indirectly, or aiding, abetting or encouraging the making,
publishing, disseminating or circulating of, any oral or written
statement or any pamphlet, circular, article or literature which is false
or maliciously critical of or derogatory to the financial condition of an
insurer, and which is calculated to injure any person engaged in the
business of insurance.
(4) Boycott, coercion and intimidation. Entering into any agreement
to commit, or by any concerted action committing, any act of boycott,
coercion or intimidation resulting in or tending to result in unreasonable
restraint of, or monopoly in, the business of insurance.
(5) False financial statements. Filing with any supervisory or other
public official, or making, publishing, disseminating, circulating or
delivering to any person, or placing before the public, or causing,
directly or indirectly, to be made, published, disseminated, circulated or
delivered to any person, or placed before the public, any false statement
of financial condition of an insurer with intent to deceive; or making any
false entry in any book, report or statement of any insurer with intent to Substitute Senate Bill No. 841
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deceive any agent or examiner lawfully appointed to examine into its
condition or into any of its affairs, or any public official to whom such
insurer is required by law to report, or who has authority by law to
examine into its condition or into any of its affairs, or, with like intent,
wilfully omitting to make a true entry of any material fact pertaining to
the business of such insurer in any book, report or statement of such
insurer.
(6) Unfair claim settlement practices. Committing or performing with
such frequency as to indicate a general business practice any of the
following: (A) Misrepresenting pertinent facts or insurance policy
provisions relating to coverages at issue; (B) failing to acknowledge and
act with reasonable promptness upon communications with respect to
claims arising under insurance policies; (C) failing to adopt and
implement reasonable standards for the prompt investigation of claims
arising under insurance policies; (D) refusing to pay claims without
conducting a reasonable investigation based upon all available
information; (E) failing to affirm or deny coverage of claims within a
reasonable time after proof of loss statements have been completed; (F)
not attempting in good faith to effectuate prompt, fair and equitable
settlements of claims in which liability has become reasonably clear; (G)
compelling insureds to institute litigation to recover amounts due under
an insurance policy by offering substantially less than the amounts
ultimately recovered in actions brought by such insureds; (H)
attempting to settle a claim for less than the amount to which a
reasonable man would have believed he was entitled by reference to
written or printed advertising material accompanying or made part of
an application; (I) attempting to settle claims on the basis of an
application which was altered without notice to, or knowledge or
consent of the insured; (J) making claims payments to insureds or
beneficiaries not accompanied by statements setting forth the coverage
under which the payments are being made; (K) making known to
insureds or claimants a policy of appealing from arbitration awards in Substitute Senate Bill No. 841
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favor of insureds or claimants for the purpose of compelling them to
accept settlements or compromises less than the amount awarded in
arbitration; (L) delaying the investigation or payment of claims by
requiring an insured, claimant, or the physician of either to submit a
preliminary claim report and then requiring the subsequent submission
of formal proof of loss forms, both of which submissions contain
substantially the same information; (M) failing to promptly settle claims,
where liability has become reasonably clear, under one portion of the
insurance policy coverage in order to influence settlements under other
portions of the insurance policy coverage; (N) failing to promptly
provide a reasonable explanation of the basis in the insurance policy in
relation to the facts or applicable law for denial of a claim or for the offer
of a compromise settlement; (O) using as a basis for cash settlement with
a first party automobile insurance claimant an amount which is less than
the amount which the insurer would pay if repairs were made unless
such amount is agreed to by the insured or provided for by the
insurance policy.
(7) Failure to maintain complaint handling procedures. Failure of any
person to maintain complete record of all the complaints which it has
received since the date of its last examination. This record shall indicate
the total number of complaints, their classification by line of insurance,
the nature of each complaint, the disposition of these complaints, and
the time it took to process each complaint. For purposes of this
subsection "complaint" means any written communication primarily
expressing a grievance.
(8) Misrepresentation in insurance applications. Making false or
fraudulent statements or representations on or relative to an application
for an insurance policy for the purpose of obtaining a fee, commission,
money or other benefit from any insurer, producer or individual.
(9) Any violation of any one of sections 38a-358, 38a-446, 38a-447, 38a-
488, 38a-825, 38a-826, 38a-828 and 38a-829. None of the following Substitute Senate Bill No. 841
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practices shall be considered discrimination within the meaning of
section 38a-446 or 38a-488 or a rebate within the meaning of section 38a-
825: (A) Paying bonuses to policyholders or otherwise abating their
premiums in whole or in part out of surplus accumulated from
nonparticipating insurance, provided any such bonuses or abatement of
premiums shall be fair and equitable to policyholders and for the best
interests of the company and its policyholders; (B) in the case of policies
issued on the industrial debit plan, making allowance to policyholders
who have continuously for a specified period made premium payments
directly to an office of the insurer in an amount which fairly represents
the saving in collection expense; (C) readjustment of the rate of premium
for a group insurance policy based on loss or expense experience, or
both, at the end of the first or any subsequent policy year, which may be
made retroactive for such policy year.
(10) Notwithstanding any provision of any policy of insurance,
certificate or service contract, whenever such insurance policy or
certificate or service contract provides for reimbursement for any
services which may be legally performed by any practitioner of the
healing arts licensed to practice in this state, reimbursement under such
insurance policy, certificate or service contract shall not be denied
because of race, color or creed nor shall any insurer make or permit any
unfair discrimination against particular individuals or persons so
licensed.
(11) Favored agent or insurer: Coercion of debtors. (A) No person
may (i) require, as a condition precedent to the lending of money or
extension of credit, or any renewal thereof, that the person to whom
such money or credit is extended or whose obligation the creditor is to
acquire or finance, negotiate any policy or contract of insurance through
a particular insurer or group of insurers or producer or group of
producers; (ii) unreasonably disapprove the insurance policy provided
by a borrower for the protection of the property securing the credit or Substitute Senate Bill No. 841
Public Act No. 21-137 10 of 20
lien; (iii) require directly or indirectly that any borrower, mortgagor,
purchaser, insurer or producer pay a separate charge, in connection
with the handling of any insurance policy required as security for a loan
on real estate or pay a separate charge to substitute the insurance policy
of one insurer for that of another; or (iv) use or disclose information
resulting from a requirement that a borrower, mortgagor or purchaser
furnish insurance of any kind on real property being conveyed or used
as collateral security to a loan, when such information is to the
advantage of the mortgagee, vendor or lender, or is to the detriment of
the borrower, mortgagor, purchaser, insurer or the producer complying
with such a requirement.
(B) (i) Subparagraph (A)(iii) of this subdivision shall not include the
interest which may be charged on premium loans or premium
advancements in accordance with the security instrument. (ii) For
purposes of subparagraph (A)(ii) of this subdivision, such disapproval
shall be deemed unreasonable if it is not based solely on reasonable
standards uniformly applied, relating to the extent of coverage required
and the financial soundness and the services of an insurer. Such
standards shall not discriminate against any particular type of insurer,
nor shall such standards call for the disapproval of an insurance policy
because such policy contains coverage in addition to that required. (iii)
The commissioner may investigate the affairs of any person to whom
this subdivision applies to determine whether such person has violated
this subdivision. If a violation of this subdivision is found, the person in
violation shall be subject to the same procedures and penalties as are
applicable to other provisions of section 38a-815, subsections (b) and (e)
of section 38a-817 and this section. (iv) For purposes of this section,
"person" includes any individual, corporation, limited liability
company, association, partnership or other legal entity.
(12) Refusing to insure, refusing to continue to insure or limiting the
amount, extent or kind of coverage available to an individual or Substitute Senate Bill No. 841
Public Act No. 21-137 11 of 20
charging an individual a different rate for the same coverage because of
physical disability, mental or nervous condition as set forth in section
38a-488a or intellectual disability, except where the refusal, limitation or
rate differential is based on sound actuarial principles or is related to
actual or reasonably anticipated experience.
(13) Refusing to insure, refusing to continue to insure or limiting the
amount, extent or kind of coverage available to an individual or
charging an individual a different rate for the same coverage solely
because of blindness or partial blindness. For purposes of this
subdivision, "refusal to insure" includes the denial by an insurer of
disability insurance coverage on the grounds that the policy defines
"disability" as being presumed in the event that the insured is blind or
partially blind, except that an insurer may exclude from coverage any
disability, consisting solely of blindness or partial blindness, when such
condition existed at the time the policy was issued. Any individual who
is blind or partially blind shall be subject to the same standards of sound
actuarial principles or actual or reasonably anticipated experience as are
sighted persons with respect to all other conditions, including the
underlying cause of the blindness or partial blindness.
(14) Refusing to insure, refusing to continue to insure or limiting the
amount, extent or kind of coverage available to an individual or
charging an individual a different rate for the same coverage because of
exposure to diethylstilbestrol through the female parent.
(15) (A) Failure by an insurer, or any other entity responsible for
providing payment to a health care provider pursuant to an insurance
policy, to pay accident and health claims, including, but not limited to,
claims for payment or reimbursement to health care providers, within
the time periods set forth in subparagraph (B) of this subdivision, unless
the Insurance Commissioner determines that a legitimate dispute exists
as to coverage, liability or damages or that the claimant has fraudulently
caused or contributed to the loss. Any insurer, or any other entity Substitute Senate Bill No. 841
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responsible for providing payment to a health care provider pursuant
to an insurance policy, who fails to pay such a claim or request within
the time periods set forth in subparagraph (B) of this subdivision shall
pay the claimant or health care provider the amount of such claim plus
interest at the rate of fifteen per cent per annum, in addition to any other
penalties which may be imposed pursuant to sections 38a-11, 38a-25,
38a-41 to 38a-53, inclusive, 38a-57 to 38a-60, inclusive, 38a-62 to 38a-64,
inclusive, 38a-76, 38a-83, 38a-84, 38a-117 to 38a-124, inclusive, 38a-129
to 38a-140, inclusive, 38a-146 to 38a-155, inclusive, 38a-283, 38a-288 to
38a-290, inclusive, 38a-319, 38a-320, 38a-459, 38a-464, 38a-815 to 38a-819,
inclusive, 38a-824 to 38a-826, inclusive, and 38a-828 to 38a-830,
inclusive. Whenever the interest due a claimant or health care provider
pursuant to this section is less than one dollar, the insurer shall deposit
such amount in a separate interest-bearing account in which all such
amounts shall be deposited. At the end of each calendar year each such
insurer shall donate such amount to The University of Connecticut
Health Center.
(B) Each insurer or other entity responsible for providing payment to
a health care provider pursuant to an insurance policy subject to this
section, shall pay claims not later than:
(i) For claims filed in paper format, sixty days after receipt by the
insurer of the claimant's proof of loss form or the health care provider's
request for payment filed in accordance with the insurer's practices or
procedures, except that when there is a deficiency in the information
needed for processing a claim, as determined in accordance with section
38a-477, the insurer shall (I) send written notice to the claimant or health
care provider, as the case may be, of all alleged deficiencies in
information needed for processing a claim not later than thirty days
after the insurer receives a claim for payment or reimbursement under
the contract, and (II) pay claims for payment or reimbursement under
the contract not later than thirty days after the insurer receives the Substitute Senate Bill No. 841
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information requested; and
(ii) For claims filed in electronic format, twenty days after receipt by
the insurer of the claimant's proof of loss form or the health care
provider's request for payment filed in accordance with the insurer's
practices or procedures, except that when there is a deficiency in the
information needed for processing a claim, as determined in accordance
with section 38a-477, the insurer shall (I) notify the claimant or health
care provider, as the case may be, of all alleged deficiencies in
information needed for processing a claim not later than ten days after
the insurer receives a claim for payment or reimbursement under the
contract, and (II) pay claims for payment or reimbursement under the
contract not later than ten days after the insurer receives the information
requested.
(C) As used in this subdivision, "health care provider" means a person
licensed to provide health care services under chapter 368d, chapter
368v, chapters 370 to 373, inclusive, 375 to 383c, inclusive, 384a to 384c,
inclusive, or chapter 400j.
(16) Failure to pay, as part of any claim for a damaged motor vehicle
under any automobile insurance policy where the vehicle has been
declared to be a constructive total loss, an amount equal to the sum of
(A) the settlement amount on such vehicle plus, whenever the insurer
takes title to such vehicle, (B) an amount determined by multiplying
such settlement amount by a percentage equivalent to the current sales
tax rate established in section 12-408. For purposes of this subdivision,
"constructive total loss" means the cost to repair or salvage damaged
property, or the cost to both repair and salvage such property, equals or
exceeds the total value of the property at the time of the loss.
(17) Any violation of section 42-260, by an extended warranty
provider subject to the provisions of said section, including, but not
limited to: (A) Failure to include all statements required in subsections Substitute Senate Bill No. 841
Public Act No. 21-137 14 of 20
(c) and (f) of section 42-260 in an issued extended warranty; (B) offering
an extended warranty without being (i) insured under an adequate
extended warranty reimbursement insurance policy or (ii) able to
demonstrate that reserves for claims contained in the provider's
financial statements are not in excess of one-half the provider's audited
net worth; (C) failure to submit a copy of an issued extended warranty
form or a copy of such provider's extended warranty reimbursement
policy form to the Insurance Commissioner.
(18) With respect to an insurance company, hospital service
corporation, health care center or fraternal benefit society providing
individual or group health insurance coverage of the types specified in
subdivisions (1), (2), (4), (6), (10), (11) and (12) of section 38a-469,
refusing to insure, refusing to continue to insure or limiting the amount,
extent or kind of coverage available to an individual or charging an
individual a different rate for the same coverage because such
individual has been a victim of family violence.
(19) With respect to an insurance company, hospital service
corporation, health care center or fraternal benefit society providing
individual or group health insurance coverage of the types specified in
subdivisions (1), (2), (3), (4), (6), (9), (10), (11) and (12) of section 38a-469,
refusing to insure, refusing to continue to insure or limiting the amount,
extent or kind of coverage available to an individual or charging an
individual a different rate for the same coverage because of genetic
information. Genetic information indicating a predisposition to a
disease or condition shall not be deemed a preexisting condition in the
absence of a diagnosis of such disease or condition that is based on other
medical information. An insurance company, hospital service
corporation, health care center or fraternal benefit society providing
individual health coverage of the types specified in subdivisions (1), (2),
(3), (4), (6), (9), (10), (11) and (12) of section 38a-469, shall not be
prohibited from refusing to insure or applying a preexisting condition Substitute Senate Bill No. 841
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limitation, to the extent permitted by law, to an individual who has been
diagnosed with a disease or condition based on medical information
other than genetic information and has exhibited symptoms of such
disease or condition. For the purposes of this subsection, "genetic
information" means the information about genes, gene products or
inherited characteristics that may derive from an individual or family
member.
(20) Any violation of sections 38a-465 to 38a-465q, inclusive.
(21) With respect to a managed care organization, as defined in
section 38a-478, failing to establish a confidentiality procedure for
medical record information, as required by section 38a-999.
(22) Any violation of sections 38a-591d to 38a-591f, inclusive.
(23) Any violation of section 38a-472j.
(24) Any violation of section 2 of this act.
Sec. 4. (NEW) (Effective July 1, 2021) (a) (1) Except as provided in
subsection (b) of this section, no insurer that delivers, issues for delivery,
renews, amends or endorses a homeowners insurance policy in this
state on or after July 1, 2021, that is subject to the requirements of
sections 38a-663 to 38a-696, inclusive, of the general statutes shall cancel
such policy unless:
(A) If such policy is not a renewal policy and has been in effect for
fewer than sixty days, such insurer sends a written cancellation notice
to the named insured:
(i) At least ten days before the effective date of such cancellation for
nonpayment of premium disclosing:
(I) Such cancellation; Substitute Senate Bill No. 841
Public Act No. 21-137 16 of 20
(II) That the named insured may avoid such cancellation and
continue coverage under such policy by paying, before the effective date
of such cancellation, such unpaid premium; and
(III) That any excess premium, if not tendered by the insurer, shall be
refunded to the named insured upon demand by the named insured; or
(ii) At least thirty days before the effective date of such cancellation
for any reason other than nonpayment of premium disclosing:
(I) Such cancellation;
(II) The reason for such cancellation;
(III) The effective date of such cancellation; and
(IV) That any excess premium, if not tendered by the insurer, shall be
refunded to the named insured upon demand by the named insured; or
(B) If such policy is not a renewal policy and has been in effect for at
least sixty days, or if such policy is an effective renewal policy, such
insurer sends a written cancellation notice to the named insured:
(i) At least ten days before the effective date of such cancellation for
nonpayment of premium disclosing:
(I) Such cancellation;
(II) That the named insured may avoid such cancellation and
continue coverage under such policy by paying, before the effective date
of such cancellation, such unpaid premium; and
(III) That any excess premium, if not tendered by the insurer, shall be
refunded to the named insured upon demand by the named insured; or
(ii) At least thirty days before the effective date of such cancellation
for fraud or misrepresentation of any material fact made by the named Substitute Senate Bill No. 841
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insured in obtaining coverage under such policy that, if discovered by
such insurer, would have caused such insurer not to issue or renew such
policy, as applicable, or any physical change in the covered property
that materially increases a hazard insured against under such policy
disclosing:
(I) The effective date of such cancellation; and
(II) That any excess premium, if not tendered by the insurer, shall be
refunded to the named insured upon demand by the named insured.
(2) No insurer may cancel a homeowners insurance policy described
in subparagraph (B) of subdivision (1) of this subsection for any reason
other than:
(A) Nonpayment of premium;
(B) Fraud or misrepresentation of any material fact made by the
named insured in obtaining coverage under such policy that, if
discovered by the insurer, would have caused the insurer not to issue or
renew such policy, as applicable; or
(C) Any physical change in the covered property that materially
increases a hazard insured against under such policy.
(3) No notice of cancellation required under subdivision (1) of this
subsection shall be effective unless such notice is sent to the named
insured by registered mail, certified mail or mail evidenced by a
certificate of mailing, or, if agreed by the insurer and the named insured,
by electronic means evidenced by a delivery receipt.
(b) No notice of cancellation is required under subsection (a) of this
section if the homeowners insurance policy is transferred from the
insurer to an affiliate of such insurer for another policy with no
interruption of coverage and the same terms, conditions and provisions, Substitute Senate Bill No. 841
Public Act No. 21-137 18 of 20
including policy limits, as the transferred policy, except that the insurer
to which the policy is transferred shall not be prohibited from applying
such insurer's rates and rating plans at the time of renewal.
(c) The named insured under a homeowners insurance policy
described in subsection (a) of this section may cancel such policy at any
time by sending to the insurer that delivered, issued for delivery,
renewed, amended or endorsed such policy a written notice disclosing
the effective date of such cancellation.
Sec. 5. Section 38a-646 of the general statutes is repealed and the
following is substituted in lieu thereof (Effective October 1, 2021):
As used in sections 38a-645 to 38a-658, inclusive, except as otherwise
provided herein:
(1) "Credit life insurance" means insurance on the life of a debtor
pursuant to or in connection with a specific loan or other credit
transaction;
(2) "Credit accident and health insurance" means insurance on a
debtor to provide indemnity for payments becoming due on a specific
loan or other credit transaction while the debtor is disabled as defined
in the policy;
(3) "Creditor" means the lender of money or vendor or lessor of
goods, services, property, rights or privileges for which payment is
arranged through a credit transaction or any successor to the right, title
or interest of any such lender, vendor or lessor, and an affiliate, associate
or subsidiary of any of them or any director, officer or employee of any
of them or any other person in any way associated with any of them;
(4) "Debtor" means a borrower of money or a purchaser or lessee of
goods, services, property, rights or privileges for which payment is
arranged through a credit transaction; Substitute Senate Bill No. 841
Public Act No. 21-137 19 of 20
(5) "Indebtedness" means the total amount payable by a debtor to a
creditor in connection with a loan or other credit transaction; [.] and
(6) "Loss ratio" means annual incurred claims divided by earned
premiums.
Sec. 6. Subsection (b) of section 38a-651 of the general statutes is
repealed and the following is substituted in lieu thereof (Effective October
1, 2021):
(b) The commissioner shall adopt regulations in accordance with the
provisions of chapter 54, establishing a procedure for review of such
policies, certificates of insurance, notices of proposed insurance,
applications for insurance, endorsements and riders, and shall
disapprove any such form at any time if: [the]
(1) The schedule of premium rates charged or to be charged is, by
reasonable assumptions and as determined according to benchmark
loss ratio calculations, excessive in relation to the benefits provided; or
[if it contains]
(2) Such form:
(A) Has a prima facie loss ratio of less than fifty per cent for any single
or joint credit life insurance or credit accident and health insurance
policy unless the commissioner approves a premium rate deviation for
such policy; or
(B) Contains provisions which (i) are unjust, unfair, inequitable,
misleading, deceptive, [or which] (ii) encourage misrepresentation of
the coverage, or [which] (iii) are contrary to any provision of the
insurance laws or of any rule or regulation promulgated thereunder.
Sec. 7. Subsection (e) of section 38a-702e of the general statutes is
repealed and the following is substituted in lieu thereof (Effective October Substitute Senate Bill No. 841
Public Act No. 21-137 20 of 20
1, 2021):
(e) Each applicant for an insurance producer license shall, before
being admitted to an examination under subsection (a) of this section,
prove to the satisfaction of the commissioner that such applicant meets
one of the following prerequisites: (1) Successful completion of a course
approved by the commissioner requiring not less than [forty] twenty
hours for each line of insurance for which the applicant is applying to
be licensed; or (2) equivalent experience or training as determined by
the commissioner.