Iowa Senate Bill SF409

Iowa 2023-2024 Regular Session

• Introduced: 2/23/23

Caption

A bill for an act relating to value-added products or services offered by insurers or producers.(Formerly SSB 1150.)

Impact

The introduction of SF409 brings about significant implications on state insurance laws by amending the existing language in Code section 507B.4. It sets forth a legal framework that allows insurers to incorporate additional services while maintaining certain standards and nondiscrimination principles. This shift is poised to provide customers with expanded options while ensuring that offerings are fair and reasonably priced in relation to policy premiums.

Summary

Senate File 409 addresses the scope of value-added products or services that insurers and producers can offer. The bill aims to clarify the parameters under which these products or services may be considered as unfair discrimination or rebates, specifically excluding those provided at little to no cost from such definitions. It establishes that these additions must relate to the respective insurance policy and primarily serve functions such as risk mitigation, cost reduction, health enhancement, and customer education regarding liability.

Contention

During discussions surrounding the bill, there were notable debates regarding the potential for insurers to exploit this change. Advocates argued that SF409 would empower consumers by providing added value and support, especially during the claims process. Conversely, critics expressed concern that without stringent oversight, these value-added services could lead to increased premiums or a lack of adequate coverage if insurers opt for cost-saving measures instead of enhancing service quality.