Rhode Island 2023 Regular Session

Rhode Island House Bill H5659 Compare Versions

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55 2023 -- H 5659
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99 S TATE OF RHODE IS LAND
1010 IN GENERAL ASSEMBLY
1111 JANUARY SESSION, A.D. 2023
1212 ____________
1313
1414 A N A C T
1515 RELATING TO INSURANCE - CASUALTY INSURANCE RATING
1616 Introduced By: Representatives Morales, Henries, Giraldo, Biah, Sanchez, DeSimone,
1717 Cruz, Felix, Alzate, and Stewart
1818 Date Introduced: February 17, 2023
1919 Referred To: House Corporations
2020
2121
2222 It is enacted by the General Assembly as follows:
2323 SECTION 1. Section 27-9-4 of the General Laws in Chapter 27-9 entitled "Casualty 1
2424 Insurance Rating" is hereby amended to read as follows: 2
2525 27-9-4. Considerations in making of rates — Cancellation of policy. 3
2626 (a) All rates shall be made in accordance with the following provisions: 4
2727 (1)(i) Due consideration shall be given to past and prospective loss experience within and 5
2828 outside this state, to catastrophe hazards, if any, to a reasonable margin for underwriting profit and 6
2929 contingencies, to dividends, savings, or unabsorbed premium deposits allowed or returned by 7
3030 insurers to their policyholders, members, or subscribers, to past and prospective expenses both 8
3131 countrywide and those specially applicable to this state, and to all other relevant factors within and 9
3232 outside this state; provided, that no consideration shall be given to: 10
3333 (A) Any loss or incident involving a bus driver, while in the course of his or her 11
3434 employment for the Rhode Island public transit authority or private or municipal school bus 12
3535 companies, in establishing or maintaining that driver’s rate respecting the operation of a personal 13
3636 motor vehicle or vehicles; 14
3737 (B) Any loss or incident involving a law enforcement officer, while in the course of his or 15
3838 her employment for the state, city, town police departments, or federal law enforcement agency, in 16
3939 establishing or maintaining that driver’s rate respecting the operation of a personal motor vehicle 17
4040 or vehicles; and 18
4141 (C) Any loss or incident involving a commercial vehicle driver, while in the course of his 19
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4545 or her employment, in establishing or maintaining that driver’s rate respecting the operation of a 1
4646 personal motor vehicle(s); 2
4747 (ii) It shall be the responsibility of a commercial vehicle driver to provide his or her 3
4848 insurance company with proof that the loss or incident took place in the course of employment 4
4949 while operating a commercial vehicle. For the purposes of this section, a “commercial vehicle” 5
5050 shall be a motor vehicle with a gross weight in excess of ten thousand pounds (10,000 lbs.) or a 6
5151 motor vehicle used for public livery; 7
5252 (2) The systems of expense provisions included in the rates for use by any insurer or group 8
5353 of insurers may differ from those of other insurers or groups of insurers to reflect the requirements 9
5454 of the operating methods of any insurer or group with respect to any kind of insurance, or with 10
5555 respect to any subdivision or combination of insurance for which subdivision or combination 11
5656 separate expense provisions are applicable; 12
5757 (3) Risks may be grouped by classifications for the establishment of rates and minimum 13
5858 premiums; 14
5959 (4) Rates shall not be excessive, inadequate, or unfairly discriminatory; and 15
6060 (5) In establishing or maintaining an insured’s rate or classification respecting the operation 16
6161 of a personal motor vehicle, any insured sixty-five (65) years of age or older, who meets the criteria 17
6262 set forth in this section and has not had any chargeable accidents or moving violations within three 18
6363 (3) years preceding the establishment of the rate of insurance or classification, shall not be penalized 19
6464 solely by reason of his or her age. 20
6565 (b)(1) No insurance company organized to do business within this state shall make any 21
6666 distinction or discrimination as to the premiums or rates charged for automobile insurance policies, 22
6767 and determination of the rate class of the individual, on the basis of education level, race, ethnicity, 23
6868 disability, occupation, income, gender, zip code or adjacent zip code, census tract, nor insert in the 24
6969 policy any condition nor make any stipulation where the person insured shall bind himself or 25
7070 herself, his or her heirs, executors, administrators and assigners, to accept any less sum than the 26
7171 full value or amount of the policy in case of a claim accruing on the policy by reason of the claim 27
7272 of the person insured, other than those stipulations or conditions as are imposed upon all persons 28
7373 in similar cases, and any stipulation or condition made in this manner shall be void. 29
7474 (2) The insurance company shall solely rely on the driving record of the individual with 30
7575 regard to the premiums or rates charged for automobile insurance policies and the acceptance or 31
7676 rejection of the application of the individual for insurance coverage. 32
7777 (b)(c) No insurance company shall fail to renew a private passenger automobile policy 33
7878 because of a loss of occurrence only, unless a chargeable loss occurrence of three thousand dollars 34
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8282 ($3,000) or more than two (2) nonchargeable loss occurrences, involving the insured, have taken 1
8383 place within the annual policy year. 2
8484 (c)(d)(1) No insurance company shall fail to renew a private passenger automobile policy 3
8585 solely because the insured has attained the age of sixty-five (65) years or older; 4
8686 (2) Whenever the commissioner of insurance shall have reason to believe that any 5
8787 insurance company has refused to renew a private passenger automobile policy solely because the 6
8888 applicant has reached the age of sixty-five (65) years or older, the commissioner shall notify the 7
8989 company that it may be in violation of this section and in his or her discretion he or she may require 8
9090 a hearing to determine whether or not the company has actually been engaged in the practice stated 9
9191 in this subsection. Any hearing held under this section shall in all respects comply with the hearing 10
9292 procedure provided in the Administrative Procedures Act, chapter 35 of title 42; 11
9393 (3) If after the hearing the commissioner shall determine that the company has engaged in 12
9494 the practice of systematically failing to renew private passenger automobile policies because of the 13
9595 advanced age of the insured, he or she shall reduce his or her findings to writing and shall issue and 14
9696 cause to be served upon the company an order to cease and desist from engaging in those practices. 15
9797 After the issuance of the cease and desist order, if the commissioner finds that the company has 16
9898 continued to engage in those practices, he or she shall impose upon the company a fine not to 17
9999 exceed the amount of one thousand dollars ($1,000) for each separate violation. 18
100100 (4) Any company aggrieved by any order or decision of the commissioner of insurance 19
101101 may appeal the order and decision to the superior court of Providence in accordance with the 20
102102 Administrative Procedures Act, chapter 35 of title 42. 21
103103 (d)(e) No insurance group, carrier, or company in establishing any premium surcharge or 22
104104 penalty relative to a specific motor vehicle policy, shall consider any accident or any claim where 23
105105 any insured covered by that policy is fifty percent (50%) or less at fault. 24
106106 (e)(f) No insurance group, carrier, or company shall assess any premium surcharge against 25
107107 any insured covered by a motor vehicle policy where a property damage claim payment is less than 26
108108 three thousand dollars ($3,000). 27
109109 (f)(g) No insurance group, carrier, or company shall refuse to issue motor vehicle liability 28
110110 insurance, impose a surcharge, or otherwise increase the rate for a motor vehicle policy solely 29
111111 because the applicant is a volunteer driver. Volunteer driver is defined as a person who provides 30
112112 services without compensation to a nonprofit agency or charitable organization. 31
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116116 SECTION 2. This act shall take effect on January 1, 2024 and apply prospectively to any 1
117117 policy for automobile insurance coverage issued or renewed on or after January 1, 2024. 2
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124124 EXPLANATION
125125 BY THE LEGISLATIVE COUNCIL
126126 OF
127127 A N A C T
128128 RELATING TO INSURANCE - CASUALTY INSURANCE R ATING
129129 ***
130130 This act would prohibit automobile insurance companies from utilizing education level, 1
131131 race, ethnicity, disability, occupation, income, gender, zip code or adjacent zip code, or census tract 2
132132 to determine automobile insurance rates, premiums, and/or eligibility for coverage. This act would 3
133133 also restrict the insurance companies to rely solely on the driving record of the individual with 4
134134 regard to premiums or rates changed for insurance policies or rejection of the individua l's 5
135135 application for coverage. The department of business regulation would enforce the provisions of 6
136136 this act. 7
137137 This act would take effect on January 1, 2024 and apply prospectively to any policy for 8
138138 automobile insurance coverage issued or renewed on or after January 1, 2024. 9
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