HLS 10RS-979 ORIGINAL
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Regular Session, 2010
HOUSE BILL NO. 447
BY REPRESENTATIVE PEARSON
INSURANCE/POLICIES: Provides relative to certificates of insurance
AN ACT1
To amend and reenact R.S. 22:881.1, relative to certificates of insurance; to define such2
certificates and otherwise provide with respect to their issuance and effect; to3
provide for the responsibilities of the commissioner of insurance relative to such4
certificates, including approval of forms and enforcement; to provide for prohibitions5
and penalties; and to provide for related matters.6
Be it enacted by the Legislature of Louisiana:7
Section 1. R.S. 22:881.1 is hereby amended and reenacted to read as follows: 8
ยง881.1. Certificates of insurance9
A. For the purposes of this Section:10
(1) "Certificate of insurance", as used by property and casualty insurers, shall11
mean any document issued by or on behalf of an insurer to a third party who has not12
contracted with the insurer to purchase an insurance policy and is provided for13
informational purposes only to advise a third party of the existence and limits of14
insurance coverage issued to the named insured.15
(1) "Certificate" or "certificate of insurance" means any document,16
instrument, or record, including an electronic record, no matter how titled or17
described, which is prepared or issued as evidence of insurance coverage.18
(2) "Certificate holder" means any person, other than a policyholder, that19
requests, obtains, or possesses a certificate of insurance.20 HLS 10RS-979 ORIGINAL
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(3) "Electronic record" shall have the meaning defined in R.S. 9:2602(7). 1
(4) "Insurance" shall have the meaning defined in R.S. 22:46(9).2
(2) (5) "Insurance producer" shall have the same definition as set forth in3
R.S. 22:1542.4
(6) "Insurer" means an insurer as defined in R.S. 22:46(10) and any other5
person engaged in the business of making insurance contracts, including but not6
limited to self-insurers, syndicates, risk purchasing groups, and similar risk transfer7
entities.8
(7) "Person" means any individual, company, insurer, organization,9
reciprocal or inter-insurance exchange, business, partnership, corporation, limited10
liability company, association, trust, or other legal entity, including any government11
or governmental subdivision or agency.12
(8) "Policyholder" means a person who has contracted with a property or13
casualty insurer for insurance coverage.14
(9) "Record" shall have the meaning defined in R.S. 9:2602(13).15
(10) "Self-insurer" means any individual business or group of businesses16
which have created a risk purchasing group, risk retention plan, syndicate, or other17
form of self-insurance covering property or casualty risk exposures.18
B. No property or casualty insurer or insurance producer may issue a19
certificate of insurance or any other type of document purporting to be a certificate20
of insurance that will affirmatively or negatively alter, amend, or extend the21
coverage provided by the referenced insurance policy. A certificate of insurance22
shall also not convey any contractual rights to the certificate holder.23
C. Any insurer or insurance producer acting on behalf of the insurer issuing24
a certificate of insurance shall be authorized to use only the standard ACORD or ISO25
Form "Certificate of Insurance" or other form filed with and approved by the26
commissioner of insurance. No person, wherever located, may prepare, issue, or27
request the issuance of a certificate of insurance unless the form has been filed with28
and approved by the commissioner of insurance. No person, wherever located, may29 HLS 10RS-979 ORIGINAL
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alter or modify an approved certificate of insurance form unless the alteration or1
modification has been approved by the commissioner of insurance.2
D. The commissioner of insurance shall disapprove a form filed under this3
Section or withdraw approval of a form if the form meets any of the following4
qualifications:5
(1) Is unfair, misleading, or deceptive, or violates public policy.6
(2) Fails to comply with the requirements of Subsection E of this Section.7
(3) Violates any law, including any regulation adopted by the commissioner8
of insurance.9
(4) Requires certification of insurance coverages that are not reasonably10
available.11
E. Each certificate of insurance shall contain the following or similar12
statement: "This certificate of insurance is issued as a matter of information only13
and confers no rights upon the certificate holder. This certificate does not amend,14
extend, or alter the coverage afforded by the policies referenced herein."15
F. Standard certificate of insurance forms promulgated by the Association16
for Cooperative Operations Research and Development (ACORD), the American17
Association of Insurance Services (AAIS), or the Insurance Services Office (ISO)18
are deemed approved by the commissioner of insurance and are not required to be19
filed.20
G. No person, wherever located, shall demand or request the issuance of a21
certificate of insurance from an insurer, insurance producer, or policyholder that22
contains any false or misleading information concerning the policy of insurance to23
which the certificate makes reference.24
H. No person, wherever located, may knowingly prepare or issue a25
certificate of insurance that contains any false or misleading information or that26
purports to affirmatively or negatively alter, amend, or extend the coverage provided27
by the policy of insurance to which the certificate makes reference.28 HLS 10RS-979 ORIGINAL
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I. No person may prepare, issue, or request, either in addition to or in lieu of1
a certificate of insurance, an opinion letter or other document or correspondence,2
instrument, or record, including an electronic record, that is inconsistent with this3
Section; however, an insurer, insurance producer, or policyholder may prepare or4
issue an addendum to a certificate that clarifies and explains the coverages provided5
by a policy of insurance and otherwise complies with the requirements of this6
Section.7
J. The provisions of this Section shall apply to all certificate holders,8
policyholders, insurers, insurance producers, and certificate of insurance forms9
issued as evidence of insurance coverages on property, operations, or risks located10
in this state, regardless of where the certificate holder, policyholder, insurer, or11
insurance producer is located.12
K. A certificate of insurance is not a policy of insurance and does not13
affirmatively or negatively amend, extend, or alter the coverage afforded by the14
policy to which the certificate of insurance makes reference. A certificate of15
insurance shall not confer to a certificate holder new or additional rights beyond16
what the referenced policy of insurance provides.17
L. No certificate of insurance shall contain references to legal or insurance18
requirements contained in any contracts other than the underlying contracts of19
insurance, including construction or service contracts. Notwithstanding any20
requirement, term, or condition of any contract or other document with respect to21
which a certificate of insurance may be issued or may pertain, the insurance afforded22
by the referenced policy of insurance is subject to all the terms, exclusions, and23
conditions of the policy itself.24
M. A certificate holder shall only have a legal right to notice of cancellation,25
nonrenewal, or any material change, or any similar notice concerning a policy of26
insurance if the person is named within the policy or any endorsement as an27
additional insured, and the policy or endorsement requires notice to be provided.28
The terms and conditions of the notice, including the required timing of the notice,29 HLS 10RS-979 ORIGINAL
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are governed by the policy of insurance and cannot be altered by a certificate of1
insurance.2
N. Any certificate of insurance and any attached addendum prepared, issued,3
or requested in violation of this Section shall be null and void and of no force and4
effect and shall not be discoverable or admissible as evidence in any private civil5
action or administrative proceeding.6
O. Any certificate holder, policyholder, insurer, or insurance producer who7
violates this Section shall be fined not more than one thousand dollars per violation.8
P. The commissioner of insurance shall have the power to examine and9
investigate the affairs of any person in order to determine whether such person has10
been or is engaged in an act or practice prohibited by this Section. The11
commissioner of insurance shall have the power to enforce the provisions of this12
Section and impose any authorized penalty or remedy against any person who13
violates this Section.14
D.Q. Pursuant to the Administrative Procedure Act, the commissioner of15
insurance may adopt reasonable rules and regulations as are necessary or proper to16
carry out the purposes of this Section.17
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Pearson HB No. 447
Abstract: Provides relative to certificates of insurance.
Proposed law provides relative to certificates of insurance as follows:
(1)Present law defines a certificate of insurance, as used by property and casualty
insurers, as a document issued on or behalf of an insurer to a third party who has not
contracted with the insurer to purchase an insurance policy, and is provided for
informational purposes only to advise a third party of the existence and limits of
insurance coverage issued to the named insured.
Proposed law instead defines a certificate of insurance as any document, instrument,
or record, including an electronic record, no matter how titled or described, which
is prepared or issued as evidence of insurance coverage. HLS 10RS-979 ORIGINAL
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(2)Retains definition of "insurance producer" from present law and additionally
provides for definitions of "electronic record", "insurance", "insurer", "person",
"policyholder", "record", and "self-insurer".
(3)Present law prohibits any property or casualty insurer or insurance producer from
issuing a certificate of insurance or any other type of document purporting to be a
certificate of insurance that will affirmatively or negatively alter, amend, or extend
the coverage provided by the referenced insurance policy. Also specifies that a
certificate of insurance shall not convey any contractual rights to the certificate
holder.
Proposed law retains present law.
(4)Present law provides that any insurer or insurance producer acting on behalf of the
insurer issuing a certificate of insurance shall be authorized to use only the standard
ACORD or ISO Form "Certificate of Insurance" or other form filed with and
approved by the commissioner of insurance.
Proposed law instead prohibits any person from preparing, issuing, or requesting the
issuance of a certificate of insurance unless the form has been filed with and
approved by the commissioner of insurance. Also prohibits alteration or
modification of an approved certificate of insurance form unless the alteration or
modification has been approved by the commissioner of insurance; however,
provides that standard certificate of insurance forms promulgated by the Association
for Cooperative Operations Research and Development (ACORD), the American
Association of Insurance Services (AAIS), or the Insurance Services Office (ISO)
are deemed approved by the commissioner of insurance and are not required to be
filed.
Additionally requires the commissioner to disapprove a form filed or withdraw
approval of a form if the form:
(a)Is unfair, misleading, or deceptive, or violates public policy.
(b)Fails to contain the following or similar statement: "This certificate of insurance is
issued as a matter of information only and confers no rights upon the certificate
holder. This certificate does not amend, extend, or alter the coverage afforded by the
policies referenced herein."
(c)Violates any law, including any regulation adopted by the commissioner of
insurance.
(d)Requires certification of insurance coverages that are not reasonably available.
(5)Prohibits any person from demanding or requesting the issuance of a certificate of
insurance from an insurer, insurance producer, or policyholder that contains any false
or misleading information concerning the policy of insurance to which the certificate
makes reference. Also prohibits any person from knowingly preparing or issuing
a certificate of insurance that contains any false or misleading information or that
purports to affirmatively or negatively alter, amend, or extend the coverage provided
by the policy of insurance to which the certificate makes reference. Further prohibits
any person from preparing, issuing, or requesting, either in addition to or in lieu of
a certificate of insurance, an opinion letter or other document or correspondence,
instrument, or record, including an electronic record, that is inconsistent with
proposed law; however, allows an insurer, insurance producer, or policyholder to
prepare or issue an addendum to a certificate that clarifies and explains the coverages
provided by a policy of insurance and otherwise complies with the requirements of
proposed law. HLS 10RS-979 ORIGINAL
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(6)Provides that proposed law shall apply to all certificate holders, policyholders,
insurers, insurance producers, and certificate of insurance forms issued as evidence
of insurance coverages on property, operations, or risks located in this state,
regardless of where any such entity is located.
(7)Provides that a certificate of insurance is not a policy of insurance and does not
affirmatively or negatively amend, extend, or alter the coverage afforded by the
policy to which the certificate of insurance makes reference. Specifies that a
certificate of insurance shall not confer to a certificate holder new or additional rights
beyond what the referenced policy of insurance provides.
(8)Provides that no certificate of insurance shall contain references to legal or insurance
requirements contained in any contracts other than the underlying contracts of
insurance, including construction or service contracts. Notwithstanding any
requirement, term, or condition of any contract or other document with respect to
which a certificate of insurance may be issued or may pertain, provides that the
insurance afforded by the referenced policy of insurance is subject to all the terms,
exclusions, and conditions of the policy itself.
(9)Provides that a certificate holder shall only have a legal right to notice of
cancellation, nonrenewal, or any material change, or any similar notice concerning
a policy of insurance if the person is named within the policy or any endorsement as
an additional insured, and the policy or endorsement requires notice to be provided.
Specifies that the terms and conditions of the notice, including the required timing
of the notice, are governed by the policy of insurance and cannot be altered by a
certificate of insurance.
(10)Provides that any certificate of insurance and any attached addendum prepared,
issued, or requested in violation of proposed law shall be null and void and of no
force and effect and shall not be discoverable or admissible as evidence in any
private civil action or administrative proceeding.
(11)Imposes a fine of not more than $1,000 per violation on any certificate holder,
policyholder, insurer, or insurance producer who violates proposed law.
(12)Authorizes the commissioner to examine and investigate the affairs of any person in
order to determine whether such person has been or is engaged in an act or practice
prohibited by proposed law. Further authorizes the commissioner to enforce the
provisions of proposed law and to impose any authorized penalty or remedy against
any person who violates proposed law.
(13)Present law authorizes the commissioner, pursuant to the Administrative Procedure
Act, to adopt reasonable and necessary rules to carry out the purposes of proposed
law.
Proposed law retains present law.
(Amends R.S. 22:881.1)