North Carolina 2025-2026 Regular Session

North Carolina House Bill H356 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		GENERAL ASSEMBLY OF NORTH CAROLINA
2	2		SESSION 2025
3		-	H 1
4		-	HOUSE BILL 356
	3	+	H D
	4	+	HOUSE BILL DRH10163-NE-99
	5	+
5	6
6	7
7	8		Short Title: Permitted Trade Practices/Insurance Rebates.-AB (Public)
8	9		Sponsors: Representative Humphrey.
9		-	For a complete list of sponsors, refer to the North Carolina General Assembly web site.
10		-	Referred to: Insurance, if favorable, Finance, if favorable, Rules, Calendar, and Operations of
11		-	the House
12		-	March 12, 2025
13		-	H356 -v-1
	10	+	Referred to:
	11	+
	12	+	DRH10163 -NE-99
14	13		A BILL TO BE ENTITLED 1
15	14		AN ACT CLARIFYING PERMITTED TRADE PRACTICES WITH RESPECT TO 2
16	15		INSURANCE REBATES, AS RECOMMENDED BY THE DEPARTMENT OF 3
17	16		INSURANCE. 4
18	17		The General Assembly of North Carolina enacts: 5
19	18		SECTION 1. G.S. 58-63-15(8)b.4. and G.S. 58-63-16 are repealed. 6
20	19		SECTION 2. G.S. 58-63-15 reads as rewritten: 7
21	20		"§ 58-63-15. Unfair methods of competition and unfair or deceptive acts or practices 8
22	21		defined. 9
23	22		The following are hereby defined as unfair methods of competition and unfair and deceptive 10
24	23		acts or practices in the business of insurance: 11
25	24		… 12
26	25		(8) Rebates. – 13
27	26		… 14
28	27		b. Nothing in subdivision (7) or paragraph a of subdivision (8) of this 15
29	28		section shall be construed as including within the definition of 16
30	29		discrimination or rebates any of the following practices: 17
31	30		… 18
32	31		5. Engaging in an arrangement that would not violate section 106 19
33	32		of the Bank Holding Company Act Amendments of 1972 (12 20
34	33		U.S.C. § 1972), as interpreted by the Board of Governors of 21
35	34		the Federal Reserve System, or section 5(q) of the Home 22
36	35		Owners' Loan Act, 12 U.S.C. § 1464(q). 23
37	36		6. The offer or provision by insurers or producers, by or through 24
38	37		employees, affiliates, or third-party representatives, of 25
39	38		value-added products or services at no or reduced cost when 26
40	39		such products or services are not specified in the policy of 27
41	40		insurance if all of the following criteria are met: 28
42	41		I. Relates to the insurance coverage and is primarily 29
43	42		designed to satisfy one or more of the following: 30
44	43		A. Providing loss mitigation or loss control. 31
45	44		B. Reducing claim costs or claim settlement costs. 32
46	45		C. Providing education about liability risks or risk 33
47		-	of loss to persons or property. 34 General Assembly Of North Carolina Session 2025
48		-	Page 2 House Bill 356-First Edition
	46	+	of loss to persons or property. 34
	47	+	H.B. 356
	48	+	Mar 10, 2025
	49	+	HOUSE PRINCIPAL CLERK General Assembly Of North Carolina Session 2025
	50	+	Page 2 DRH10163-NE-99
49	51		D. Monitoring or assessing risk, identifying 1
50	52		sources of risk, or developing strategies for 2
51	53		eliminating or reducing risk. 3
52	54		E. Enhancing health. 4
53	55		F. Enhancing financial wellness through items 5
54	56		such as education or financial planning 6
55	57		services. 7
56	58		G. Providing post-loss services. 8
57	59		H. Incentivizing behavioral changes to improve 9
58	60		the health or reduce the risk of death or 10
59	61		disability of a customer. For purposes of this 11
60	62		sub-sub-sub-sub-subdivision, "customer" 12
61	63		means a policyholder, potential policyholder, 13
62	64		certificate holder, potential certificate holder, 14
63	65		insured, potential insured, or applicant. 15
64	66		I. Assisting in the administration of the employee 16
65	67		or retiree benefit insurance coverage. 17
66	68		II. The cost to the insurer or producer offering the product 18
67	69		or service to any given customer must be reasonable in 19
68	70		comparison to that customer's premiums or insurance 20
69	71		coverage for the policy class. 21
70	72		III. If the insurer or producer is providing the product or 22
71	73		service offered, the insurer or producer must ensure 23
72	74		that the customer is provided with contact information 24
73	75		to assist the customer with questions regarding the 25
74	76		product or service. 26
75	77		IV. The availability of the value-added product or service 27
76	78		must be based on documented objective criteria and 28
77	79		offered in a manner that is not unfairly discriminatory. 29
78	80		The documented criteria must be maintained by the 30
79	81		insurer or producer and produced upon request by the 31
80	82		Department. 32
81	83		7. The offer or provision of products or services that otherwise 33
82	84		meet the criteria of sub-sub-subdivision 6. of this 34
83	85		sub-subdivision, where the insurer or producer does not have 35
84	86		sufficient evidence to demonstrate but has a good-faith belief 36
85	87		that the products or service satisfies one or more of the 37
86	88		conditions listed in sub-sub-sub-sub-subdivisions A. through I. 38
87	89		of sub-sub-sub-subdivision I. of sub-sub-subdivision 6. of this 39
88	90		sub-subdivision. The products and services shall be offered or 40
89	91		provided in a manner that is not unfairly discriminatory as part 41
90	92		of a pilot or testing program for no more than one year. An 42
91	93		insurer or producer offering or providing products or services 43
92	94		pursuant to this sub-sub-subdivision must notify the 44
93	95		Department of the pilot or testing program prior to 45
94	96		implementation and may proceed with the program unless the 46
95	97		Department objects within 21 days of notice. 47
96	98		8. The offer or gifting by an insurer or producer of noncash gifts, 48
97	99		items, or services, including meals to or charitable donations 49
98	100		on behalf of a customer, if all of the following criteria are met: 50 General Assembly Of North Carolina Session 2025
99		-	~~House Bill 356-First Edition~~ Page 3
	101	+	DRH10163-NE-99 Page 3
100	102		I. The noncash gifts, items, or services are made to, or on 1
101	103		behalf of, customers, including commercial or 2
102	104		institutional customers, in connection with the 3
103	105		marketing, sale, purchase, or retention of contracts of 4
104	106		insurance. 5
105	107		II. The cost of the noncash gifts, items, or services does 6
106	108		not exceed two hundred fifty dollars ($250.00) per 7
107	109		policy term. 8
108	110		III. The offer or gift is made in a manner that is not unfairly 9
109	111		discriminatory. 10
110	112		IV. The customer is not required to purchase, continue to 11
111	113		purchase, or renew a policy in exchange for the offer or 12
112	114		gift. 13
113	115		9. The conducting of drawings or raffles by an insurer or 14
114	116		producer, to the extent they are otherwise permitted by law, if 15
115	117		all of the following criteria are met: 16
116	118		I. There is no financial cost to entrants to participate in 17
117	119		the drawing or raffle. 18
118	120		II. The drawing or raffle does not obligate participants to 19
119	121		purchase insurance. 20
120	122		III. The prizes of the drawing or raffle are not valued in 21
121	123		excess of two hundred fifty dollars ($250.00). 22
122	124		IV. The drawing or raffle is open to the public and 23
123	125		conducted in a manner that is not unfairly 24
124	126		discriminatory. 25
125	127		V. The customer is not required to purchase, continue to 26
126	128		purchase, or renew a policy in exchange for 27
127	129		participation in the drawing or raffle. 28
128	130		c. No insurer or employee thereof, and no insurance producer shall pay, 29
129	131		allow, or give, or offer to pay, allow, or give, directly or indirectly, as 30
130	132		an inducement to insurance, or after insurance has been effected, any 31
131	133		rebate, discount, abatement, credit or reduction of the premium named 32
132	134		in a policy of insurance, or any special favor or advantage in the 33
133	135		dividends or other benefits to accrue thereon, or any valuable 34
134	136		consideration or inducement whatever, not specified in the policy of 35
135	137		insurance. Nothing herein contained shall be construed as prohibiting 36
136	138		prohibiting: (i) the payment of commissions or other compensation to 37
137	139		regularly appointed and licensed insurance producers duly licensed by 38
138	140		this State; nor as prohibiting State, (ii) any participating insurer from 39
139	141		distributing to its policyholders dividends, savings or the unused or 40
140	142		unabsorbed portion of premiums and premium deposits.deposits, or 41
141	143		(iii) the trade practices permitted by sub-subdivision b. of this 42
142	144		subdivision. 43
143	145		d. An insurer, producer, or representative of either may not offer or 44
144	146		provide insurance as an inducement to the purchase of another policy 45
145	147		or otherwise use the words "free," "no cost," or words of similar 46
146	148		import, in an advertisement. 47
147	149		…." 48
148	150		SECTION 3. G.S. 58-33-85 reads as rewritten: 49
149	151		"§ 58-33-85. Rebates and charges in excess of premium prohibited; exceptions. 50 General Assembly Of North Carolina Session 2025
150		-	Page 4 ~~House Bill 356-First Edition~~
	152	+	Page 4 DRH10163-NE-99
151	153		(a) No insurer, insurance producer, or limited representative shall knowingly charge, 1
152	154		demand or receive a premium for any policy of insurance except in accordance with the 2
153	155		applicable filing approved by the Commissioner. No insurer, insurance producer, or limited 3
154	156		representative shall pay, allow, or give, or offer to pay, allow, or give, directly or indirectly, as 4
155	157		an inducement to insurance, or after insurance has been effected, any rebate, discount, abatement, 5
156	158		credit, or reduction of the premium named in a policy of insurance, or any special favor or 6
157	159		advantage in the dividends or other benefits to accrue thereon, or any valuable consideration or 7
158	160		inducement whatever, not specified in the policy of insurance. No insured named in a policy of 8
159	161		insurance, nor any employee of such insured, shall knowingly receive or accept, directly or 9
160	162		indirectly, any such rebate, discount, abatement or reduction of premium, or any special favor or 10
161	163		advantage or valuable consideration or inducement. Nothing herein contained shall be construed 11
162	164		as prohibiting (i) the payment of commissions or other compensation to duly licensed insurance 12
163	165		producers and limited representatives, (ii) any participating insurer from distributing to its 13
164	166		policyholders dividends, savings or the unused or unabsorbed portion of premiums and premium 14
165	167		deposits, or (iii) the trade practices permitted by G.S. 58-63-16. sub-subdivision b. of subdivision 15
166	168		(8) of G.S. 58-63-15. As used in this section the word "insurance" includes suretyship and the 16
167	169		word "policy" includes bond. 17
168	170		…." 18
169	171		SECTION 4. This act is effective when it becomes law and applies to trade practices 19
170	172		related to insurance contracts issued, renewed, or amended on or after that date. 20