Maryland 2023 Regular Session

Maryland Senate Bill SB725 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	WES MOORE, Governor Ch. 38
2	1
3		-	– 1 –
4		-	Chapter 38
5		-	(Senate Bill 725)
6	2
7		-	AN ACT concerning
	3	+	EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
	4	+	[Brackets] indicate matter deleted from existing law.
	5	+	Underlining indicates amendments to bill.
	6	+	Strike out indicates matter stricken from the bill by amendment or deleted from the law by
	7	+	amendment.
	8	+	sb0725
8	9
9		-	Insurance – Product and Service Offerings
	10	+	SENATE BILL 725
	11	+	J5, C4 3lr0111
	12	+	SB 556/20 – FIN
	13	+	By: Chair, Finance Committee (By Request – Departmental – Maryland Insurance
	14	+	Administration)
	15	+	Introduced and read first time: February 6, 2023
	16	+	Assigned to: Finance
	17	+	Committee Report: Favorable with amendments
	18	+	Senate action: Adopted
	19	+	Read second time: March 3, 2023
10	20
11		-	FOR the purpose of authorizing certain insurers, nonprofit health service plans, and health
12		-	maintenance organizations to offer and provide certain products or services in
13		-	conjunction with a policy at no charge or at a discounted price under certain
14		-	circumstances; prohibiting certain insurers, nonprofit health service plans, and
15		-	health maintenance organizations from increasing a premium or denying a claim
16		-	based on a certain action by a policyholder; and generally relating to programs and
17		-	services offered by insurers, nonprofit health service plans, and health maintenance
18		-	organizations.
	21	+	CHAPTER ______
19	22
20		-	BY repealing and reenacting, with amendments,
21		-	Article – Insurance
22		-	Section 27–209 and 27–212
23		-	Annotated Code of Maryland
24		-	(2017 Replacement Volume and 2022 Supplement)
	23	+	AN ACT concerning 1
25	24
26		-	BY repealing and reenacting, without amendments,
27		-	Article – Insurance
28		-	Section 27–210 and 27–211
29		-	Annotated Code of Maryland
30		-	(2017 Replacement Volume and 2022 Supplement)
	25	+	Insurance – Product and Service Offerings 2
31	26
32		-	SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
33		-	That the Laws of Maryland read as follows:
	27	+	FOR the purpose of authorizing certain insurers, nonprofit health service plans, and health 3
	28	+	maintenance organizations to offer and provide certain products or services in 4
	29	+	conjunction with a policy at no charge or at a discounted price under certain 5
	30	+	circumstances; prohibiting certain insurers, nonprofit health service plans, and 6
	31	+	health maintenance organizations from increasing a premium or denying a claim 7
	32	+	based on a certain action by a policyholder; and generally relating to programs and 8
	33	+	services offered by insurers, nonprofit health service plans, and health maintenance 9
	34	+	organizations. 10
34	35
35		-	Article – Insurance
	36	+	BY repealing and reenacting, with amendments, 11
	37	+	Article – Insurance 12
	38	+	Section 27–209 and 27–212 13
	39	+	Annotated Code of Maryland 14
	40	+	(2017 Replacement Volume and 2022 Supplement) 15
36	41
37		-	27–209.
	42	+	BY repealing and reenacting, without amendments, 16
	43	+	Article – Insurance 17
	44	+	Section 27–210 and 27–211 18
	45	+	Annotated Code of Maryland 19
	46	+	(2017 Replacement Volume and 2022 Supplement) 20
	47	+	2 SENATE BILL 725
38	48
39		-	(a) Except as otherwise expressly provided by law, a person, including a health
40		-	maintenance organization, may not knowingly:
41	49
42		-	(1) allow, make, or offer to make a contract of life insurance or health
43		-	insurance or an annuity contract or an agreement as to the contract other than as plainly
44		-	expressed in the contract;
	50	+	SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 1
	51	+	That the Laws of Maryland read as follows: 2
45	52
46		-	(2) pay, allow, give, or offer to pay, allow, or give directly or indirectly as
47		-	an inducement to the insurance or annuity:
	53	+	Article – Insurance 3
48	54
49		-	~~(i) a rebate of premiums payable on the contract; Ch~~. ~~38 2023 LAWS OF MARYLAND~~
	55	+	27–209. 4
50	56
51		-	– 2 –
	57	+	(a) Except as otherwise expressly provided by law, a person, including a health 5
	58	+	maintenance organization, may not knowingly: 6
52	59
53		-	(ii) a special favor or advantage in the dividends or other benefits
54		-	under the contract;
	60	+	(1) allow, make, or offer to make a contract of life insurance or health 7
	61	+	insurance or an annuity contract or an agreement as to the contract other than as plainly 8
	62	+	expressed in the contract; 9
55	63
56		-	(iii) paid employment or a contract for services of any kind; or
	64	+	(2) pay, allow, give, or offer to pay, allow, or give directly or indirectly as 10
	65	+	an inducement to the insurance or annuity: 11
57	66
58		-	(iv) any valuable consideration or other inducement not specified in
59		-	the contract;
	67	+	(i) a rebate of premiums payable on the contract; 12
60	68
61		-	(3) directly or indirectly give, sell, purchase, offer or agree to give, sell, or
62		-	purchase, or allow as inducement to the insurance or annuity or in connection with the
63		-	insurance or annuity, regardless of whether specified in the policy or contract, an
64		-	agreement that promises returns and profits, or stocks, bonds, or other securities, or a
65		-	present or contingent interest in or measured by stocks, bonds, or other securities, of an
66		-	insurer or other corporation, association, or partnership, or dividends or profits accrued or
67		-	to accrue on stocks, bonds, or other securities; or
	69	+	(ii) a special favor or advantage in the dividends or other benefits 13
	70	+	under the contract; 14
68	71
69		-	(4) offer, promise, or give any valuable consideration not specified in the
70		-	contract, except for educational materials, promotional materials, or articles of
71		-	merchandise that cost no more than $50.
	72	+	(iii) paid employment or a contract for services of any kind; or 15
72	73
73		-	(b) A person may not make receipt of any educational materials, promotional
74		-	materials, or articles of merchandise under subsection (a)(4) of this section contingent on
75		-	the sale or purchase of insurance.
	74	+	(iv) any valuable consideration or other inducement not specified in 16
	75	+	the contract; 17
76	76
77		-	(C) (1) THIS SECTION DOES NOT PROHIBIT AN INSURER , A NONPROFIT
78		-	HEALTH SERVICE PLAN , OR A HEALTH MAINTENA NCE ORGANIZATION FRO M
79		-	OFFERING OR PROVIDIN G PRODUCTS OR SERVIC ES IN CONJUNCTION WI TH A POLICY
80		-	AT NO CHARGE OR AT A DISCOUNTED PRICE IF :
	77	+	(3) directly or indirectly give, sell, purchase, offer or agree to give, sell, or 18
	78	+	purchase, or allow as inducement to the insurance or annuity or in connection with the 19
	79	+	insurance or annuity, regardless of whether specified in the policy or contract, an 20
	80	+	agreement that promises returns and profits, or stocks, bonds, or other securities, or a 21
	81	+	present or contingent interest in or measured by stocks, bonds, or other securities, of an 22
	82	+	insurer or other corporation, association, or partnership, or dividends or profits accrued or 23
	83	+	to accrue on stocks, bonds, or other securities; or 24
81	84
82		-	(I) ~~1. A.~~ THE ~~PRODUCTS OR SERVICES ARE OFFERED OR~~
83		-	~~PROVIDED TO EDUCATE PERSONS REGARDING~~ , OR ~~TO ASSESS,~~ ~~MONITOR, CONTROL,~~
84		-	~~OR PREVENT,~~ ~~RISK OF LOSS TO PERS ONS;~~ ~~AND~~
	85	+	(4) offer, promise, or give any valuable consideration not specified in the 25
	86	+	contract, except for educational materials, promotional materials, or articles of 26
	87	+	merchandise that cost no more than $50. 27
85	88
86		-	B. THE RISK OF LOSS TO PERSONS IS ASSOCIATE D WITH
87		-	RISKS INSURED AGAINS T BY THE POLICY OR I NSURANCE OR ANNUITY CONTRACT ; OR
	89	+	(b) A person may not make receipt of any educational materials, promotional 28
	90	+	materials, or articles of merchandise under subsection (a)(4) of this section contingent on 29
	91	+	the sale or purchase of insurance. 30
88	92
89		-	2. THE PRODUCTS OR SERV ICES ARE:
	93	+	(C) (1) THIS SECTION DOES NOT PROHIBIT AN INSURER , A NONPROFIT 31
	94	+	HEALTH SERVICE PLAN , OR A HEALTH MAINTENA NCE ORGANIZATION FRO M 32
	95	+	OFFERING OR PROVIDIN G PRODUCTS OR SERVIC ES IN CONJUNCTION WI TH A POLICY 33
	96	+	AT NO CHARGE OR AT A DISCOUNTED PRICE IF : 34 SENATE BILL 725 3
90	97
91		-	A. SUBSTANTIALLY RELATE D TO THE INSURANCE
92		-	PROVIDED UNDER THE P OLICY OR CONTRACT ; OR
93	98
94		-	B. OFFERED OR PROVIDED TO ENHANCE THE HEALT H OF
95		-	THE INSURED OR BENEF ICIARY; AND
96		-	WES MOORE, Governor Ch. 38
97	99
98		-	– 3 –
99		-	(II) THE OFFER OR P ROVISION OF PRODUCTS OR SERVICES IS
100		-	AVAILABLE TO ALL POL ICYHOLDERS THAT HAVE PURCHASED THE POLICY OR
101		-	CONTRACT ASSOCIATED WITH THE OFFER OR PR OVISION.
	100	+	(I) 1. A. THE PRODUCTS OR SERV ICES ARE OFFERED OR 1
	101	+	PROVIDED TO EDUCATE PERSONS REGARDING , OR TO ASSESS, MONITOR, CONTROL, 2
	102	+	OR PREVENT, RISK OF LOSS TO PERS ONS; AND 3
102	103
103		-	(2) AN INSURER, A NONPROFIT HEALTH S ERVICE PLAN, OR A HEALTH
104		-	MAINTENANCE ORGANIZA TION MAY INCLUDE AN OFFER OR A PROVISION OF
105		-	PRODUCTS OR SERVICES UNDER THIS SUBSECTIO N IN AN APPLICABLE C ONTRACT
106		-	OR FORM OR RATE FILI NG.
	104	+	B. THE RISK OF LOSS TO PERSONS IS ASSOCIATE D WITH 4
	105	+	RISKS INSURED AGAINS T BY THE POLICY OR I NSURANCE OR ANNUITY CONTRACT ; OR 5
107	106
108		-	(3) (I) IF THE OFFER OR PROVI SION OF SPECIFIC PRO DUCTS OR
109		-	SERVICES UNDER THIS SUBSECTION IS INCLUD ED IN ANY POLICY OF INSURANCE,
110		-	HEALTH MAINTENANCE ORGANIZA TION CONTRACT , NONPROFIT HEALTH SER VICE
111		-	PLAN, OR ANNUITY CONTRACT , THE PRODUCTS OR SERV ICES MAY NOT BE
112		-	DISCONTINUED DURING THE TERM OF THE POLI CY OR CONTRACT UNLES S
113		-	DISCONTINUATION OF T HE PRODUCT OR SERVIC ES IS:
	107	+	2. THE PRODUCTS OR SERV ICES ARE: 6
114	108
115		-	1. ~~CONSENTED~~ TO ~~IN WRITING BY~~ THE ~~POLIC YHOLDER;~~
116		-	OR
	109	+	A. SUBSTANTIALLY RELATE D TO THE INSURANCE 7
	110	+	PROVIDED UNDER THE P OLICY OR CONTRACT ; OR 8
117	111
118		-	2. THE ~~RESULT~~ OF ~~A UNIF ORM MODIFICATION UND ER §~~
119		-	~~15–1212, § 15–1309,~~ OR ~~§ 15–1409 OF THIS ARTICLE.~~
	112	+	B. OFFERED OR PROVIDED TO ENHANCE THE HEALT H OF 9
	113	+	THE INSURED OR BENEF ICIARY; AND 10
120	114
121		-	(II) THIS PARAGRAPH DOES N OT PROHIBIT A CARRIE R FROM
122		-	TERMINATING A CONTRA CT AS OTHERWISE AUTH ORIZED UNDER THIS AR TICLE.
	115	+	(II) THE OFFER OR PROVISI ON OF PRODUCTS OR SE RVICES IS 11
	116	+	AVAILABLE TO ALL POL ICYHOLDERS THAT HAVE PURCHASED THE POLICY OR 12
	117	+	CONTRACT ASSOCIATED WITH THE OFFER OR PR OVISION. 13
123	118
124		-	(4) AN INSURER, A NONPROFIT HEALTH S ERVICE PLAN, OR A HEALTH
125		-	MAINTENANCE ORGANIZA TION MAY ~~NOT INCREAS E THE PREMIUM OR DEN Y~~ A ~~CLAIM~~
126		-	~~OF A POLICYHOLDER IF THE POLICYHOLDER ACC EPTS, REJECTS, USES,~~ OR ~~FAILS TO~~
127		-	~~USE A PRODUCT~~ OR ~~SER VICE UNDER THIS SUBS ECTION~~.
	119	+	(2) AN INSURER, A NONPROFIT HEALTH S ERVICE PLAN, OR A HEALTH 14
	120	+	MAINTENANCE ORGANIZA TION MAY INCLUDE AN OFFER O R A PROVISION OF 15
	121	+	PRODUCTS OR SERVICES UNDER THIS SUBSECTIO N IN AN APPLICABLE C ONTRACT 16
	122	+	OR FORM OR RATE FILI NG. 17
128	123
129		-	(5) THE (I) SUBJECT TO SUBPARAGRA PH (II) OF THIS
130		-	PARAGRAPH , THE COMMISSIONER MAY DETE RMINE BY REGULATION THE TYPES OF
131		-	PRODUCTS OR SERVICES THAT MEET THE CRITER IA IN PARAGRAPH (1) OF THIS
132		-	SUBSECTION.
	124	+	(3) (I) IF THE OFFER OR PROVI SION OF SPECIFIC PRO DUCTS OR 18
	125	+	SERVICES UNDER THIS SUBSECTION IS INCLUD ED IN ANY POLICY OF INSURANCE, 19
	126	+	HEALTH MAINTENANCE O RGANIZATION CONTRACT , NONPROFIT HEALTH SER VICE 20
	127	+	PLAN, OR ANNUITY CONTRACT , THE PRODUCTS OR SERV ICES MAY NOT BE 21
	128	+	DISCONTINUED DURING THE TERM OF THE POLI CY OR CONTRACT UNLES S 22
	129	+	DISCONTINUATION OF T HE PRODUCT OR SERVIC ES IS: 23
133	130
134		-	(II) A PRODUCT OR SERVICE O FFERED OR PROVIDED IN
135		-	CONJUNCTION WITH AN INSURANCE POLICY OR ANNUITY CONTRACT THA T IS
136		-	PRIMARILY DESIGNED T O ENHANCE FINANCIAL WELLNESS SHALL BE AL LOWED IF
137		-	THE COMMISSIONER DETERMIN ES THAT THE PRODUCT OR SERVICE INCLUDES AN
138		-	ENHANCEMENT TO THE F INANCIAL PROTECTION COMPONENT OF THE INSUR ANCE
139		-	POLICY OR ANNUITY CO NTRACT.
	131	+	1. CONSENTED TO IN WRITIN G BY THE POLICYHOLDE R; 24
	132	+	OR 25
140	133
141		-	~~27–210~~.
142		-	~~Ch.~~ 38 ~~2023 LAWS~~ OF ~~MARYLAND~~
	134	+	2. THE RESULT OF A UNIF ORM MODIFICATION UND ER § 26
	135	+	15–1212, § 15–1309, OR § 15–1409 OF THIS ARTICLE. 27
143	136
144		-	– 4 –
145		-	(a) Sections 27–208 and 27–209 of this subtitle may not be construed to include
146		-	within the definition of discrimination or rebates any of the practices set forth in this
147		-	section.
	137	+	(II) THIS PARAGRAPH DOES N OT PROHIBIT A CARRIE R FROM 28
	138	+	TERMINATING A CONTRA CT AS OTHERWISE AUTH ORIZED UND ER THIS ARTICLE. 29
148	139
149		-	(b) For a contract of life insurance or an annuity contract, it is not discrimination
150		-	or a rebate to pay bonuses to policyholders or otherwise abate their premiums wholly or
151		-	partly out of the surplus accumulated from nonparticipating insurance, if the bonuses or
152		-	abatement of premiums is fair, equitable to, and in the best interest of policyholders.
	140	+	(4) AN INSURER, A NONPROFIT HEALTH S ERVICE PLAN, OR A HEALTH 30
	141	+	MAINTENANCE ORGANIZA TION MAY NOT INCREAS E THE PREMIUM OR DEN Y A CLAIM 31 4 SENATE BILL 725
153	142
154		-	(c) For policies of life insurance or health insurance issued on the industrial debit,
155		-	preauthorized check, bank draft, or similar plans, it is not discrimination or a rebate to
156		-	make an allowance to policyholders who have continuously for a specified period made
157		-	premium payments directly to an office of the insurer or by preauthorized check, bank draft,
158		-	or similar plans in an amount that fairly represents the savings in collection expense.
159	143
160		-	(d) It is not discrimination or a rebate to readjust the rate of premium for a group
161		-	policy based on the loss or expense experience under the policy, at the end of any policy
162		-	year, retroactive only for that policy year.
	144	+	OF A POLICYHOLDER IF THE POLICYHOLDER ACC EPTS, REJECTS, USES, OR FAILS TO 1
	145	+	USE A PRODUCT OR SER VICE UNDER THIS SUBSECTION . 2
163	146
164		-	(e) ~~It is not discrimination or a rebate~~ to ~~reduce the premium rate for policies~~ of
165		-	~~large amount~~, if the ~~reduction does not exceed savings in issuance and administrative~~
166		-	~~expenses reasonably attributable to policies~~ of ~~large amount as compared with policies of~~
167		-	~~similar plan issued in smaller amounts~~.
	147	+	(5) THE (I) SUBJECT TO SUBPARAGRA PH (II) OF THIS 3
	148	+	PARAGRAPH , THE COMMISSIONER MAY DETE RMINE BY REGULATION THE TYPES OF 4
	149	+	PRODUCTS OR SERVICES THAT MEET THE CRITER IA IN PARAGRAPH (1) OF THIS 5
	150	+	SUBSECTION. 6
168	151
169		-	(f) It is not discrimination or a rebate to issue policies of life insurance or health
170		-	insurance or annuity contracts on a salary savings or payroll deduction plan or other
171		-	distribution plan at a reduced rate reasonably commensurate with the savings made by use
172		-	of the plan.
	152	+	(II) A PRODUCT OR SERVICE OFFERED OR PROVIDED IN 7
	153	+	CONJUNCTION WITH AN INSURANCE POLICY OR ANNUITY CONTRACT THA T IS 8
	154	+	PRIMARILY DESIGNED T O ENHANCE FINANCIAL WELLNESS SHALL BE AL LOWED IF 9
	155	+	THE COMMISSIONER DETERMIN ES THAT THE PRODUCT OR SERVICE INCLUDES AN 10
	156	+	ENHANCEMENT TO THE F INANCIAL PROTECTION COMPONENT O F THE INSURANCE 11
	157	+	POLICY OR ANNUITY CO NTRACT. 12
173	158
174		-	(g) It is not discrimination or a rebate to issue policies of health insurance that
175		-	provide for increases in benefits to policyholders who maintain their policies continuously
176		-	in force without lapse for specified periods.
	159	+	27–210. 13
177	160
178		-	(h) (1) In this subsection, “wellness program” means a program that:
	161	+	(a) Sections 27–208 and 27–209 of this subtitle may not be construed to include 14
	162	+	within the definition of discrimination or rebates any of the practices set forth in this 15
	163	+	section. 16
179	164
180		-	(i) meets the requirements of a participatory wellness program or a
181		-	health–contingent wellness program under § 15–509 of this article; and
	165	+	(b) For a contract of life insurance or an annuity contract, it is not discrimination 17
	166	+	or a rebate to pay bonuses to policyholders or otherwise abate their premiums wholly or 18
	167	+	partly out of the surplus accumulated from nonparticipating insurance, if the bonuses or 19
	168	+	abatement of premiums is fair, equitable to, and in the best interest of policyholders. 20
182	169
183		-	(ii) is provided as a benefit outside of the health insurance or health
184		-	maintenance organization contract.
	170	+	(c) For policies of life insurance or health insurance issued on the industrial debit, 21
	171	+	preauthorized check, bank draft, or similar plans, it is not discrimination or a rebate to 22
	172	+	make an allowance to policyholders who have continuously for a specified period made 23
	173	+	premium payments directly to an office of the insurer or by preauthorized check, bank draft, 24
	174	+	or similar plans in an amount that fairly represents the savings in collection expense. 25
185	175
186		-	(2) It is not discrimination or a rebate for a ~~carrier to provide reasonable~~
187		-	~~incentives to an individual who is an insured, a subscriber,~~ or ~~a member for participation~~
188		-	~~in a wellness program offered by the carrier~~.
	176	+	(d) It is not discrimination or a rebate to readjust the rate of premium for a group 26
	177	+	policy based on the loss or expense experience under the policy, at the end of any policy 27
	178	+	year, retroactive only for that policy year. 28
189	179
190		-	(3) Any incentive offered for participation in a wellness program: WES MOORE, Governor Ch. 38
	180	+	(e) It is not discrimination or a rebate to reduce the premium rate for policies of 29
	181	+	large amount, if the reduction does not exceed savings in issuance and administrative 30
	182	+	expenses reasonably attributable to policies of large amount as compared with policies of 31
	183	+	similar plan issued in smaller amounts. 32
191	184
192		-	– 5 –
	185	+	(f) It is not discrimination or a rebate to issue policies of life insurance or health 33
	186	+	insurance or annuity contracts on a salary savings or payroll deduction plan or other 34
	187	+	distribution plan at a reduced rate reasonably commensurate with the savings made by use 35
	188	+	of the plan. 36
	189	+	SENATE BILL 725 5
193	190
194		-	(i) shall be reasonably related to the wellness program; and
195	191
196		-	(ii) may not have a value that exceeds any limit established in
197		-	regulations adopted by the Commissioner.
	192	+	(g) It is not discrimination or a rebate to issue policies of health insurance that 1
	193	+	provide for increases in benefits to policyholders who maintain their policies continuously 2
	194	+	in force without lapse for specified periods. 3
198	195
199		-	(4) The Commissioner shall adopt regulations to implement the provisions
200		-	of this subsection.
	196	+	(h) (1) In this subsection, “wellness program” means a program that: 4
201	197
202		-	27–211.
	198	+	(i) meets the requirements of a participatory wellness program or a 5
	199	+	health–contingent wellness program under § 15–509 of this article; and 6
203	200
204		-	(a) This section does not apply to:
	201	+	(ii) is provided as a benefit outside of the health insurance or health 7
	202	+	maintenance organization contract. 8
205	203
206		-	(1) insurance on the life of a debtor in connection with a specific loan or
207		-	other credit transaction;
	204	+	(2) It is not discrimination or a rebate for a carrier to provide reasonable 9
	205	+	incentives to an individual who is an insured, a subscriber, or a member for participation 10
	206	+	in a wellness program offered by the carrier. 11
208	207
209		-	(2) insurance on a debtor that provides indemnity for payments that are
210		-	due on a specific loan or other credit transaction while the debtor is disabled as defined in
211		-	the policy; or
	208	+	(3) Any incentive offered for participation in a wellness program: 12
212	209
213		-	(3) life insurance or an annuity used to fund a pre–need contract as defined
214		-	in § 7–101 of the Health Occupations Article or a preneed burial contract as defined in §
215		-	5–701 of the Business Regulation Article.
	210	+	(i) shall be reasonably related to the wellness program; and 13
216	211
217		-	(b) An insurer may not directly or indirectly, or by an insurance producer or
218		-	representative of the insurer, participate in a plan to offer or effect a kind or kinds of life
219		-	insurance, health insurance, or annuities in the State as an inducement to, or in
220		-	combination with, the purchase by the public of goods, securities, commodities, services or
221		-	subscriptions to periodicals.
	212	+	(ii) may not have a value that exceeds any limit established in 14
	213	+	regulations adopted by the Commissioner. 15
222	214
223		-	27–212.
	215	+	(4) The Commissioner shall adopt regulations to implement the provisions 16
	216	+	of this subsection. 17
224	217
225		-	~~(a) This section does not apply to life insurance, health insurance, and annuities~~.
	218	+	27–211. 18
226	219
227		-	(b) Except to the extent provided for in an applicable filing with the
228		-	Commissioner as provided by law, an insurer, employee or representative of an insurer or
229		-	insurance producer may not pay, allow, give, or offer to pay, allow, or give directly or
230		-	indirectly as an inducement to insurance or after insurance has become effective:
	220	+	(a) This section does not apply to: 19
231	221
232		-	(1) a ~~rebate, discount,~~ ~~abatement, credit,~~ or ~~reduction of the premium~~
233		-	~~stated in the policy~~;
	222	+	(1) insurance on the life of a debtor in connection with a specific loan or 20
	223	+	other credit transaction; 21
234	224
235		-	(2) a ~~special favor or advantage in the dividends or other benefits to accrue~~
236		-	on the ~~policy; or~~
237		-	~~Ch.~~ ~~38 2023 LAWS OF MARYLAND~~
	225	+	(2) insurance on a debtor that provides indemnity for payments that are 22
	226	+	due on a specific loan or other credit transaction while the debtor is disabled as defined in 23
	227	+	the policy; or 24
238	228
239		-	– ~~6 –~~
240		-	~~(3) any valuable consideration~~ or ~~other inducement not specified~~ in ~~the~~
241		-	~~policy~~.
	229	+	(3) life insurance or an annuity used to fund a pre–need contract as defined 25
	230	+	in § 7–101 of the Health Occupations Article or a preneed burial contract as defined in § 26
	231	+	5–701 of the Business Regulation Article. 27
242	232
243		-	(c) An insured named in a policy or an employee of the insured may not knowingly
244		-	receive or accept directly or indirectly a rebate, discount, abatement, credit, reduction of
245		-	premium, special favor, advantage, valuable consideration, or inducement described in
246		-	subsection (b) of this section.
	233	+	(b) An insurer may not directly or indirectly, or by an insurance producer or 28
	234	+	representative of the insurer, participate in a plan to offer or effect a kind or kinds of life 29
	235	+	insurance, health insurance, or annuities in the State as an inducement to, or in 30
	236	+	combination with, the purchase by the public of goods, securities, commodities, services or 31
	237	+	subscriptions to periodicals. 32
	238	+	6 SENATE BILL 725
247	239
248		-	(d) (1) Except as otherwise provided by law, a person may not knowingly offer,
249		-	promise, or give any valuable consideration not specified in the policy, except for
250		-	educational materials, promotional materials, or articles of merchandise that cost no more
251		-	than $50.
252	240
253		-	(2) A person may not make receipt of any educational materials,
254		-	promotional materials, or articles of merchandise under this subsection contingent on the
255		-	sale or purchase of insurance.
	241	+	27–212. 1
256	242
257		-	(e) (1) An insurer may not make or allow unfair discrimination between
258		-	insureds or properties having like insuring or risk characteristics in:
	243	+	(a) This section does not apply to life insurance, health insurance, and annuities. 2
259	244
260		-	(i) the premium or rates charged for insurance;
	245	+	(b) Except to the extent provided for in an applicable filing with the 3
	246	+	Commissioner as provided by law, an insurer, employee or representative of an insurer or 4
	247	+	insurance producer may not pay, allow, give, or offer to pay, allow, or give directly or 5
	248	+	indirectly as an inducement to insurance or after insurance has become effective: 6
261	249
262		-	(ii) the dividends or other benefits payable on the insurance; or
	250	+	(1) a rebate, discount, abatement, credit, or reduction of the premium 7
	251	+	stated in the policy; 8
263	252
264		-	(iii) any of the other terms or conditions of the insurance.
	253	+	(2) a special favor or advantage in the dividends or other benefits to accrue 9
	254	+	on the policy; or 10
265	255
266		-	(2) Notwithstanding any other provision of this section, an insurer may not
267		-	make or allow a differential in ratings, premium payments, or dividends for a reason based
268		-	on the sex, physical handicap, or disability of an applicant or policyholder unless there is
269		-	actuarial justification for the differential.
	256	+	(3) any valuable consideration or other inducement not specified in the 11
	257	+	policy. 12
270	258
271		-	(f) (1) This section does not prohibit an insurer from:
	259	+	(c) An insured named in a policy or an employee of the insured may not knowingly 13
	260	+	receive or accept directly or indirectly a rebate, discount, abatement, credit, reduction of 14
	261	+	premium, special favor, advantage, valuable consideration, or inducement described in 15
	262	+	subsection (b) of this section. 16
272	263
273		-	[(1)] (I) paying commissions or other compensation to licensed insurance
274		-	producers;
	264	+	(d) (1) Except as otherwise provided by law, a person may not knowingly offer, 17
	265	+	promise, or give any valuable consideration not specified in the policy, except for 18
	266	+	educational materials, promotional materials, or articles of merchandise that cost no more 19
	267	+	than $50. 20
275	268
276		-	[(2)~~] (II) paying commissions to licensed insurance producers on~~ a
277		-	~~variable basis~~ on ~~policies issued to qualified exempt commercial policyholders, as defined~~
278		-	~~in § 11–206~~ of ~~this article,~~ ~~if:~~
	269	+	(2) A person may not make receipt of any educational materials, 21
	270	+	promotional materials, or articles of merchandise under this subsection contingent on the 22
	271	+	sale or purchase of insurance. 23
279	272
280		-	[(i)] 1. the payment of the commission to the insurance producer
281		-	on a variable basis results in a lower total cost of the policy to the qualified exempt
282		-	commercial policyholder; and
	273	+	(e) (1) An insurer may not make or allow unfair discrimination between 24
	274	+	insureds or properties having like insuring or risk characteristics in: 25
283	275
284		-	[(ii)] 2. the insurance producer receiving the commission has
285		-	agreed to the specific level of commission to be paid on the policy; [or] WES MOORE, Governor Ch. 38
	276	+	(i) the premium or rates charged for insurance; 26
286	277
287		-	~~– 7 –~~
	278	+	(ii) the dividends or other benefits payable on the insurance; or 27
288	279
289		-	[(3)] (III) allowing or returning to its participating policyholders,
290		-	members, or subscribers lawful dividends, savings, or unabsorbed premium deposits[.]; OR
	280	+	(iii) any of the other terms or conditions of the insurance. 28
291	281
292		-	(IV) ~~OFFERING OR PROVIDIN G PRODUCTS OR SERVIC ES IN~~
293		-	~~CONJUNCTION WITH~~ A ~~P OLICY AT NO CHARGE O R AT~~ A ~~DISCOUNTED PRICE TO~~
294		-	~~EDUCATE A PERSON REG ARDING~~, OR ~~TO ASSESS,~~ ~~MONITOR, CONTROL,~~ OR ~~PREVENT,~~
295		-	~~RISK OF LOSS TO PERS ONS OR PROPERTY IF :~~
	282	+	(2) Notwithstanding any other provision of this section, an insurer may not 29
	283	+	make or allow a differential in ratings, premium payments, or dividends for a reason based 30
	284	+	on the sex, physical handicap, or disability of an applicant or policyholder unless there is 31
	285	+	actuarial justification for the differential. 32
296	286
297		-	1. THE RISK OF LOSS TO PERSONS OR PROPERTY IS
298		-	ASSOCIATED WITH THE RISKS INSURED AGAINS T BY THE POLICY; AND
	287	+	(f) (1) This section does not prohibit an insurer from: 33 SENATE BILL 725 7
299	288
300		-	2. THE OFFER OR PROVISION O F PRODUCTS OR
301		-	SERVICES IS AVAILABL E TO ALL POLICYHOLDE RS THAT HAVE PURCHAS ED THE
302		-	POLICY ASSOCIATED WI TH THE OFFER OR PROV ISION.
303	289
304		-	(2) AN INSURER MAY INCLUD E IN AN APPLICABLE C ONTRACT OR
305		-	FORM OR RATE FILING AN OFFER OR A PROVIS ION OF PRODUCTS OR SERVICES
306		-	UNDER THIS SUBSECTIO N.
307	290
308		-	(3) AN INSURER MAY NOT IN CREASE THE PREMIUM O R DENY A CLAIM
309		-	OF A POLICYHOLDER IF THE POLICYHOLDER ACC EPTS, REJECTS, USES, OR FAILS TO
310		-	USE A PRODUCT OR SER VICE UNDER THIS SUBS ECTION.
	291	+	[(1)] (I) paying commissions or other compensation to licensed insurance 1
	292	+	producers; 2
311	293
312		-	(4) ~~THE COMMISSIONER MA Y DETERMINE BY REGUL ATION THE~~
313		-	~~TYPES OF PRODUCTS OR SERVICES THAT MEET T HE CRITERIA IN PARAG RAPH (1)(IV)~~
314		-	OF THIS ~~SUBSECTION .~~
	294	+	[(2)] (II) paying commissions to licensed insurance producers on a 3
	295	+	variable basis on policies issued to qualified exempt commercial policyholders, as defined 4
	296	+	in § 11–206 of this article, if: 5
315	297
316		-	SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall be construed to
317		-	apply only prospectively and may not be applied or interpreted to have any effect on or
318		-	application to any policies, contracts, and health benefit plans issued, delivered, or renewed
319		-	in the State before the effective date of this Act.
	298	+	[(i)] 1. the payment of the commission to the insurance producer 6
	299	+	on a variable basis results in a lower total cost of the policy to the qualified exempt 7
	300	+	commercial policyholder; and 8
320	301
321		-	~~SECTION 3~~. ~~AND BE IT FURTHER ENACTED,~~ ~~That this Act shall take effect July~~
322		-	~~1, 2023.~~
	302	+	[(ii)] 2. the insurance producer receiving the commission has 9
	303	+	agreed to the specific level of commission to be paid on the policy; [or] 10
323	304
324		-	Approved by the Governor, April 11, 2023.
	305	+	[(3)] (III) allowing or returning to its participating policyholders, 11
	306	+	members, or subscribers lawful dividends, savings, or unabsorbed premium deposits[.]; OR 12
	307	+
	308	+	(IV) OFFERING OR PROVIDIN G PRODUCTS OR SERVIC ES IN 13
	309	+	CONJUNCTION WITH A P OLICY AT NO CHARGE OR AT A DISCOUNTED P RICE TO 14
	310	+	EDUCATE A PERSON REG ARDING, OR TO ASSESS, MONITOR, CONTROL, OR PREVENT, 15
	311	+	RISK OF LOSS TO PERS ONS OR PROPERTY IF : 16
	312	+
	313	+	1. THE RISK OF LOSS TO PERSONS OR PROPERTY IS 17
	314	+	ASSOCIATED WITH THE RISKS INSURED AGAINS T BY THE POLICY; AND 18
	315	+
	316	+	2. THE OFFER OR PROVISI ON OF PRODUCTS OR 19
	317	+	SERVICES IS AVAILABL E TO ALL POLICYHOLDE RS THAT HAVE PURCHAS ED THE 20
	318	+	POLICY ASSOCIATED WI TH THE OFFER OR PROV ISION. 21
	319	+
	320	+	(2) AN INSURER MAY INCLUD E IN AN APPLICABLE C ONTRACT OR 22
	321	+	FORM OR RATE FILING AN OFFER OR A PROVIS ION OF PRODUCTS OR S ERVICES 23
	322	+	UNDER THIS SUBSECTIO N. 24
	323	+
	324	+	(3) AN INSURER MAY NOT IN CREASE THE PREMIUM O R DENY A CLAIM 25
	325	+	OF A POLICYHOLDER IF THE POLICYHOLDER ACC EPTS, REJECTS, USES, OR FAILS TO 26
	326	+	USE A PRODUCT OR SER VICE UNDER THIS SUBS ECTION. 27
	327	+
	328	+	(4) THE COMMISSIONER MAY DETE RMINE BY REGULATION THE 28
	329	+	TYPES OF PRODUCTS OR SERVICES THAT MEET T HE CRITERIA IN PARAG RAPH (1)(IV) 29
	330	+	OF THIS SUBSECTION . 30
	331	+
	332	+	SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall be construed to 31
	333	+	apply only prospectively and may not be applied or interpreted to have any effect on or 32 8 SENATE BILL 725
	334	+
	335	+
	336	+	application to any policies, contracts, and health benefit plans issued, delivered, or renewed 1
	337	+	in the State before the effective date of this Act. 2
	338	+
	339	+	SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect July 3
	340	+	1, 2023. 4
	341	+
	342	+
	343	+
	344	+
	345	+	Approved:
	346	+	________________________________________________________________________________
	347	+	Governor.
	348	+	________________________________________________________________________________
	349	+	President of the Senate.
	350	+	________________________________________________________________________________
	351	+	Speaker of the House of Delegates.