2023 -- S 0697 SUBSTITUTE A
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LC002296/SUB A
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S TATE OF RHODE IS LAND
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2023
____________
A N A C T
RELATING TO INSURANCE -- PRODUCER LICENSING ACT
Introduced By: Senator V. Susan Sosnowski
Date Introduced: March 22, 2023
Referred To: Senate Commerce
(Dept. of Business Regulation)
It is enacted by the General Assembly as follows:
SECTION 1. Sections 27-2.4-2 and 27-2.4-16 of the General Laws in Chapter 27-2.4 1
entitled "Producer Licensing Act" are hereby amended to read as follows: 2
27-2.4-2. Definitions. 3
The following definitions apply to this chapter: 4
(1) "Business entity” means a corporation, association, partnership, limited liability 5
company, limited liability partnership, or other legal entity; 6
(2) "Contracted producer report” means the annual report that all insurers contracting with 7
insurance producers must provide to the department on or by March 1 listing each insurance 8
producer to whom the insurer paid one hundred dollars ($100) or more in commissions for the 9
preceding calendar year of January 1 to December 31. The department shall prescribe the form and 10
manner of reporting. 11
(3) "Department” means the department of business regulation; 12
(4) "Home state” means any state or territory of the United States, or the District of 13
Columbia, in which an insurance producer maintains his or her principal place of residence or 14
principal place of business and is licensed to act as an insurance producer; 15
(5) "Insurance” means any of the lines of authority set forth in this title; 16
(6) "Insurance commissioner” means the director of the department of business regulation 17
or his or her designee; 18
(7) "Insurance producer” means a person required to be licensed under the laws of this state 19
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to sell, solicit or negotiate insurance; 1
(8) "Insurer” means: (i) any person, reciprocal exchange, interinsurer, Lloyds insurer, 2
fraternal benefit society, and any other legal entity engaged in the business of insurance, including 3
insurance producers; (ii) notwithstanding §§ 27-19-2, 27-20-2, 27-20.1-2, 27-20.2-2, 27-20.3-2, 4
and 27-41-22, all of whom shall be engaged in the business of insurance for the purpose of this 5
chapter, nonprofit hospital and/or medical service corporation, a nonprofit dental service 6
corporation, a nonprofit optometric service corporation, a nonprofit legal service corporation, a 7
health maintenance organization as defined in chapter 41 of this title or as defined in chapter 62 of 8
title 42, or any other entity providing a plan of health benefits subject to state insurance regulation; 9
and (iii) an organization that for consideration assumes certain risks for an insured. Insurer 10
organizations may include corporations, stock companies, mutual companies, risk retention groups, 11
reciprocals, captives, Lloyds associations, and government residual plans. 12
(9) "License” means a document issued by this state's insurance commissioner authorizing 13
a person to act as an insurance producer for the lines of authority specified in the document. The 14
license itself does not create any authority, actual, apparent or inherent, in the holder to represent 15
or commit an insurance carrier; 16
(10) "Limited line credit insurance” includes credit life, credit disability, credit property, 17
credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage 18
disability, guaranteed automobile protection (gap) insurance, and any other form of insurance 19
offered in connection with an extension of credit that is limited to partially or wholly extinguishing 20
that credit obligation that the insurance commissioner determines should be designated a form of 21
limited line credit insurance; 22
(11) "Limited line credit insurance producer” means a person who sells, solicits or 23
negotiates one or more forms of limited line credit insurance coverage to individuals through a 24
master, corporate, group or individual policy; 25
(12) "Limited lines insurance” means those lines of insurance that the insurance 26
commissioner deems necessary to recognize for purposes of complying with subsection 27-2.4-27
10(e); 28
(13) "Limited lines producer” means a person authorized by the insurance commissioner 29
to sell, solicit or negotiate limited lines insurance; 30
(14) "NAIC” means National Association of Insurance Commissioners; 31
(15) "Negotiate” means the act of conferring directly with or offering advice directly to a 32
purchaser or prospective purchaser of a particular contract of insurance concerning any of the 33
substantive benefits, terms or conditions of the contract, provided that the person engaged in that 34
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act either sells insurance or obtains insurance from insurers for purchasers; 1
(16) "Person” means an individual; 2
(17) "Resident” means a person who either resides in Rhode Island or maintains an office 3
in Rhode Island where the business of producing insurance is transacted and designates Rhode 4
Island as the residence for purposes of licensure; 5
(18) "Sell” means to exchange a contract of insurance by any means, for money or its 6
equivalent, on behalf of an insurance company; 7
(19) "Solicit” means attempting to sell insurance or asking or urging a person to apply for 8
a particular kind of insurance from a particular company; 9
(20) "Terminate” means the cancellation of the relationship between an insurance producer 10
and the insurer or the termination of an insurance producer's authority to transact insurance; 11
(21) "Uniform application” means the current version of the NAIC uniform application for 12
resident and nonresident insurance producer licensing. 13
27-2.4-16. Notification to insurance commissioner of termination. 14
(a) Termination for cause. An insurer or authorized representative of the insurer that 15
terminates the appointment, employment contract or other insurance business relationship with an 16
insurance producer shall notify the insurance commissioner within thirty (30) days following the 17
effective date of the termination, using a format prescribed by the insurance commissioner, if the 18
reason for termination is one of the reasons set forth in § 27-2.4-14 or the insurer has knowledge 19
the insurance producer was found by a court, government body, or self-regulatory organization 20
authorized by law to have engaged in any of the activities in § 27-2.4-14. Upon the written request 21
of the insurance commissioner, the insurer shall provide additional information, documents, records 22
or other data pertaining to the termination or activity of the insurance producer. 23
(b) Termination without cause. An insurer or authorized representative of the insurer that 24
terminates the appointment, employment, or contract with a producer for any reason not set forth 25
in § 27-2.4-14, shall notify the insurance commissioner within thirty (30) days following the 26
effective date of the termination, using a format prescribed by the insurance commissioner. Upon 27
written request of the insurance commissioner, the insurer shall provide additional information, 28
documents, records or other data pertaining to the termination. 29
(b)(c) Ongoing notification requirement. The insurer or the authorized representative of 30
the insurer shall promptly notify the insurance commissioner in a format acceptable to the insurance 31
commissioner if, upon further review or investigation, the insurer discovers additional information 32
that would have been reportable to the insurance commissioner in accordance with subsection (a) 33
of this section had the insurer then known of its existence. 34
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(c)(d) Copy of notification to be provided to the insurance producer. 1
(1) Within fifteen (15) days after making the notification required by subsections (a) and 2
(b)(c) of this section, the insurer shall mail a copy of the notification to the insurance producer at 3
his or her last known address. If the insurance producer is terminated for cause for any of the 4
reasons listed in § 27-2.4-14, the insurer shall provide a copy of the notification to the insurance 5
producer at his or her last known address by certified mail, return receipt requested, postage prepaid 6
or by overnight delivery using a nationally recognized carrier. 7
(2) Within thirty (30) days after the insurance producer has received the original or 8
additional notification, the insurance producer may file written comments concerning the substance 9
of the notification with the insurance commissioner. The insurance producer shall, by the same 10
means, simultaneously send a copy of the comments to the reporting insurer, and the comments 11
shall become a part of the insurance commissioner's file and accompany every copy of a report 12
distributed or disclosed for any reason about the insurance producer as permitted under subsection 13
(e)(f) of this section. 14
(d)(e) Immunities. 15
(1) In the absence of actual malice, an insurer, the authorized representative of the insurer, 16
an insurance producer, the insurance commissioner, or an organization of which the insurance 17
commissioner is a member and that compiles the information and makes it available to other 18
insurance commissioners or regulatory or law enforcement agencies shall not be subject to civil 19
liability, except as provided in this section, and a civil cause of action of any nature shall not arise 20
against these entities or their respective agents or employees, except as provided in this section, as 21
a result of any statement or information required by or provided pursuant to this section or any 22
information relating to any statement that may be requested in writing by the insurance 23
commissioner, from an insurer or insurance producer; or a statement by a terminating insurer or 24
insurance producer to an insurer or insurance producer limited solely and exclusively to whether a 25
termination for cause under subsection (a) of this section was reported to the insurance 26
commissioner, provided that the propriety of any termination for cause under subsection (a) of this 27
section is certified in writing by an officer or authorized representative of the insurer or insurance 28
producer terminating the relationship. 29
(2) In any action brought against a person that may have immunity under this chapter for 30
making any statement required by this section or providing any information relating to any 31
statement that may be requested by the insurance commissioner, the party bringing the action shall 32
plead specifically in any allegation that subdivision (d)(e)(1) of this section does not apply because 33
the person making the statement or providing the information did so with actual malice. 34
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(3) This chapter shall not abrogate or modify any existing statutory or common law 1
privileges or immunities. 2
(e)(f) Confidentiality. 3
(1) Any documents, materials or other information in the control or possession of the 4
department that is furnished by an insurer, insurance producer or an employee or agent of the 5
insurer or insurance producer acting on behalf of the insurer or insurance producer, or obtained by 6
the insurance commissioner in an investigation pursuant to this section, shall be confidential by law 7
and privileged, shall not be subject to chapter 2 of title 38, shall not be subject to subpoena, and 8
shall not be subject to discovery or admissible in evidence in any private civil action. The insurance 9
commissioner is authorized to use the documents, materials or other information in the furtherance 10
of any regulatory or legal action brought as a part of the insurance commissioner's duties. 11
(2) Neither the insurance commissioner nor any person who received documents, materials 12
or other information while acting under the authority of the insurance commissioner shall be 13
permitted or required to testify in any private civil action concerning any confidential documents, 14
materials, or information subject to this chapter. 15
(3) In order to assist in the performance of the insurance commissioner's duties under this 16
chapter, the insurance commissioner: 17
(i) May share documents, materials or other information, including the confidential and 18
privileged documents, materials or information subject to this chapter, with other state, federal, and 19
international regulatory agencies, with the NAIC, its affiliates or subsidiaries, and with state, 20
federal, and international law enforcement authorities, provided that the recipient agrees to 21
maintain the confidentiality and privileged status of the document, material or other information; 22
(ii) May receive documents, materials or information, including confidential and privileged 23
documents, materials or information, from the NAIC, its affiliates or subsidiaries and from 24
regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall 25
maintain as confidential or privileged any document, material or information received with notice 26
or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the 27
source of the document, material or information; 28
(iii) May enter into agreements governing sharing and use of information consistent with 29
this subsection; 30
(iv) No waiver of any applicable privilege or claim of confidentiality in the documents, 31
materials, or information shall occur as a result of disclosure to the commissioner under this section 32
or as a result of sharing as authorized in this chapter; 33
(v) Nothing in this chapter shall prohibit the insurance commissioner from releasing final, 34
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adjudicated actions including for cause terminations that are open to public inspection pursuant to 1
chapter 2 of title 38 to a database or other clearinghouse service maintained by the NAIC, its 2
affiliates or subsidiaries; and 3
(vi) If the department releases to an unauthorized third party any documents, materials or 4
other information provided to the department pursuant to this section, then the department shall be 5
subject to a fine not to exceed one thousand dollars ($1,000) after a hearing on this violation brought 6
in the Superior Court. 7
(f)(g) Penalties for failing to report. An insurer, the authorized representative of the 8
insurer, or insurance producer that fails to report as required under the provisions of this section or 9
that is found to have reported with actual malice by a court of competent jurisdiction may, after 10
notice and hearing, have its license or certificate of authority suspended or revoked and may be 11
fined in accordance with § 42-14-16. 12
SECTION 2. Section 27-13.1-7 of the General Laws in Chapter 27-13.1 entitled 13
"Examinations" is hereby amended to read as follows: 14
27-13.1-7. Cost of examinations. 15
(a) The total cost of the examinations shall be borne by the examined companies and shall 16
include the following expenses: 17
(1) One hundred fifty percent (150%) of the total salaries and benefits paid to the examining 18
personnel of the banking and insurance division engaged in those examinations less any salary 19
reimbursements; 20
(2) All reasonable technology costs related to the examination process. Technology costs 21
shall include the actual cost of software and hardware utilized in the examination process and the 22
cost of training examination insurance personnel in the proper use of the software or hardware; 23
(3) All necessary and reasonable education and training costs incurred by the state to 24
maintain the proficiency and competence of the examining insurance personnel. All these costs 25
shall be incurred in accordance with appropriate state of Rhode Island regulations, guidelines and 26
procedures. 27
(b) Expenses incurred pursuant to subsections (a)(2) and (a)(3) of this section shall be 28
allocated equally to each company domiciled in Rhode Island no more frequently than annually 29
and shall not exceed an annual average assessment of three thousand five hundred dollars ($3,500) 30
five thousand dollars ($5,000) per company for any given three (3) calendar year period. All 31
revenues collected pursuant to this section shall be deposited as general revenues. That assessment 32
shall be in addition to any taxes and fees payable to the state. 33
SECTION 3. Chapter 27-2.4 of the General Laws entitled "Producer Licensing Act" is 34
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hereby amended by adding thereto the following section: 1
27-2.4-14.1. Appointments. 2
(a) An insurance producer shall not act as an agent of an insurer unless the insurance 3
producer becomes an appointed agent of that insurer. An insurance producer who is not acting as 4
an agent of an insurer is not required to become appointed. 5
(b) To appoint a producer as its agent, the appointing insurer shall file, in a format approved 6
by the insurance commissioner, a notice of appointment within fifteen (15) days from the date the 7
first insurance application is submitted. An insurer may also elect to appoint a producer to all or 8
some insurers within the insurer's holding company system or group by the filing of a single 9
appointment request. 10
(c) An insurer shall pay an appointment fee, in the amount and method of payment set forth 11
in a regulation promulgated for that purpose, for each insurance producer appointed by the insurer. 12
(d) An insurer shall remit, in a manner prescribed by the insurance commissioner, a renewal 13
appointment fee in the amount set forth in a regulation promulgated for that purpose. 14
SECTION 4. Chapter 27-9 of the General Laws entitled "Casualty Insurance Rating" is 15
hereby amended by adding thereto the following section: 16
27-9-57. Unfair discrimination. 17
(a) No individual or entity subject to this chapter shall, because of race, color, creed, 18
national origin, or disability: 19
(1) Make any distinction or discrimination between persons as to the premiums or rates 20
charged for insurance policies. 21
(2) Demand or require a greater premium from any persons than it requires at that time 22
from others in similar cases. 23
(3) Insert in the policy any condition, or make any stipulation, whereby the insured binds 24
themselves, or their heirs, executors, administrators, or assigns, to accept any sum or service less 25
than the full value or amount of such policy in case of a claim thereon except such conditions and 26
stipulations as are imposed upon others in similar cases; and any such stipulation or condition so 27
made or inserted shall be void. 28
SECTION 5. Title 27 of the General Laws entitled "INSURANCE" is hereby amended by 29
adding thereto the following chapter: 30
CHAPTER 82 31
PET INSURANCE ACT 32
27-82-1. Short Title. 33
This act shall be known and may be cited as the "Pet Insurance Act." 34
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27-82-2. Scope and Purpose. 1
(a) The purpose of this act is to promote the public welfare by creating a comprehensive 2
legal framework within which pet insurance may be sold in this state. 3
(b) The requirements of this act shall apply to pet insurance policies that are issued to any 4
resident of this state and are sold, solicited, negotiated, or offered in this state, and policies or 5
certificates that are delivered or issued for delivery in this state. 6
(c) All other applicable provisions of this state's insurance laws shall continue to apply to 7
pet insurance except that the specific provisions of this act shall supersede any general provisions 8
of law that would otherwise be applicable to pet insurance. 9
27-82-3. Definitions. 10
(a) If a pet insurer uses any of the terms in this chapter in a policy of pet insurance, the pet 11
insurer shall use the definition of each of those terms as set forth herein and include the definition 12
of the term(s) in the policy. The pet insurer shall also make the definition available through a clear 13
and conspicuous link on the main page of the pet insurer or pet insurer's program administrator's 14
website. 15
(b) Nothing in this chapter shall in any way prohibit or limit the types of exclusions pet 16
insurers may use in their policies or require pet insurers to have any of the limitations or exclusions 17
defined below. 18
(c) As used in this chapter: 19
(1) "Chronic condition" means a condition that can be treated or managed, but not cured. 20
(2) "Congenital anomaly or disorder" means a condition that is present from birth, whether 21
inherited or caused by the environment, which may cause or contribute to illness or disease. 22
(3) "Hereditary disorder" means an abnormality that is genetically transmitted from parent 23
to offspring and may cause illness or disease. 24
(4) "Orthopedic" refers to conditions affecting the bones, skeletal muscle, cartilage, 25
tendons, ligaments, and joints. It includes, but is not limited to, elbow dysplasia, hip dysplasia, 26
intervertebral disc degeneration, patellar luxation, and ruptured cranial cruciate ligaments. It does 27
not include cancers or metabolic, hemopoietic, or autoimmune diseases. 28
(5) "Pet insurance" means a property insurance policy that provides coverage for accidents 29
and illnesses of pets. 30
(6) "Preexisting condition" means any condition for which any of the following are true 31
prior to the effective date of a pet insurance policy or during any waiting period: 32
(i) A veterinarian provided medical advice; 33
(ii) The pet received previous treatment; or 34
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(iii) Based on information from verifiable sources, the pet had signs or symptoms directly 1
related to the condition for which a claim is being made. 2
(iv) A condition for which coverage is afforded on a policy cannot be considered a 3
preexisting condition on any renewal of the policy. 4
(7) "Renewal" means to issue and deliver at the end of an insurance policy period a policy 5
which supersedes a policy previously issued and delivered by the same pet insurer or affiliated pet 6
insurer and which provides types and limits of coverage substantially similar to those contained in 7
the policy being superseded. 8
(8) "Veterinarian" means an individual who holds a valid license to practice veterinary 9
medicine from the appropriate licensing entity in the jurisdiction in which he or she practices. 10
(9) "Veterinary expenses" means the costs associated with medical advice, diagnosis, care, 11
or treatment provided by a veterinarian, including, but not limited to, the cost of drugs prescribed 12
by a veterinarian. 13
(10) "Waiting period" means the period of time specified in a pet insurance policy that is 14
required to transpire before some or all of the coverage in the policy can begin. Waiting periods 15
may not be applied to renewals of existing coverage. 16
(11) "Wellness program" means a subscription or reimbursement-based program that is 17
separate from an insurance policy that provides goods and services to promote the general health, 18
safety, or wellbeing of the pet. If any wellness program: 19
(i) Pays or indemnifies another as to loss from certain contingencies called "risks," 20
including through reinsurance; 21
(ii) Pays or grants a specified amount or determinable benefit to another in connection with 22
ascertainable risk contingencies; or 23
(iii) Acts as a surety, it is transacting in the business of insurance and is subject to the 24
insurance code, as defined in § 27-54.1-1. This definition is not intended to classify a contract 25
directly between a service provider and a pet owner that only involves the two (2) parties as being 26
"the business of insurance," unless other indications of insurance also exist. 27
27-82-4. Disclosures. 28
(a) A pet insurer transacting pet insurance shall disclose the following to consumers: 29
(1) If the policy excludes coverage due to any of the following: 30
(i) A preexisting condition; 31
(ii) A hereditary disorder; 32
(iii) A congenital anomaly or disorder; or 33
(iv) A chronic condition. 34
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(2) If the policy includes any other exclusions, the following statement: "Other exclusions 1
may apply. Please refer to the exclusions section of the policy for more information." 2
(3) Any policy provision that limits coverage through a waiting or affiliation period, a 3
deductible, coinsurance, or an annual or lifetime policy limit. 4
(4) Whether the pet insurer reduces coverage or increases premiums based on the insured's 5
claim history, the age of the covered pet or a change in the geographic location of the insured. 6
(5) If the underwriting company differs from the brand name used to market and sell the 7
product. 8
(b) Right to examine and return the policy. 9
(1) Unless the insured has filed a claim under the pet insurance policy, pet insurance 10
applicants shall have the right to examine and return the policy, certificate or rider to the company 11
or an agent/insurance producer of the company within fifteen (15) days of its receipt and to have 12
the premium refunded if, after examination of the policy, certificate or rider, the applicant is not 13
satisfied for any reason. 14
(2) Pet insurance policies, certificates and riders shall have a notice prominently printed on 15
the first page or attached thereto including specific instructions to accomplish a return. The 16
following free look statement or language substantially similar shall be included: 17
"You have fifteen (15) days from the day you receive this policy, certificate, or rider to 18
review it, and return it to the company if you decide not to keep it. You do not have to tell the 19
company why you are returning it. If you decide not to keep it, simply return it to the company at 20
its administrative office, or you may return it to the agent/insurance producer that you bought it 21
from as long as you have not filed a claim. You must return it within fifteen (15) days of the day 22
you first received it. The company will refund the full amount of any premium paid within thirty 23
(30) days after it receives the returned policy, certificate, or rider. The premium refund will be sent 24
directly to the person who paid it. The policy, certificate, or rider will be void as if it had never 25
been issued." 26
(c) A pet insurer shall clearly disclose a summary description of the basis or formula on 27
which the pet insurer determines claim payments under a pet insurance policy within the policy, 28
prior to policy issuance, and through a clear and conspicuous link on the main page of the pet 29
insurer's or pet insurer's program administrator's website. 30
(d) A pet insurer that uses a benefit schedule to determine claim payment under a pet 31
insurance policy shall do both of the following: 32
(1) Clearly disclose the applicable benefit schedule in the policy. 33
(2) Disclose all benefit schedules used by the pet insurer under its pet insurance policies 34
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through a clear and conspicuous link on the main page of the pet insurer's or pet insurer's program 1
administrator's website. 2
(e) A pet insurer that determines claim payments under a pet insurance policy based on 3
usual and customary fees, or any other reimbursement limitation based on prevailing veterinary 4
service provider charges, shall do both of the following: 5
(1) Include a usual and customary fee limitation provision in the policy that clearly 6
describes the pet insurer's basis for determining usual and customary fees and how that basis is 7
applied in calculating claim payments. 8
(2) Disclose the pet insurer's basis for determining usual and customary fees through a clear 9
and conspicuous link on the main page of the pet insurer's or pet insurer's program administrator's 10
website. 11
(f) If any medical examination by a licensed veterinarian is required to effectuate coverage, 12
the pet insurer shall clearly and conspicuously disclose the required aspects of the examination 13
prior to purchase and disclose that examination documentation may result in a preexisting condition 14
exclusion. 15
(g) Waiting periods and the requirements applicable to them, must be clearly and 16
prominently disclosed to consumers prior to the policy purchase. 17
(h) The pet insurer shall include a summary of all policy provisions required in subsections 18
(a) through (g) of this section, inclusive, in a separate document titled "insurer disclosure of 19
important policy provisions." 20
(i) The pet insurer shall post the "insurer disclosure of important policy provisions" 21
document required in subsection (h) of this section through a clear and conspicuous link on the 22
main page of the pet insurer's or pet insurer's program administrator's website. 23
(j) In connection with the issuance of a new pet insurance policy, the pet insurer shall 24
provide the consumer with a copy of the "insurer disclosure of important policy provisions" 25
document required pursuant to subsection (h) of this section in at least twelve-point (12-point) type 26
when the policy is delivered. 27
(k) At the time a pet insurance policy is issued or delivered to a policyholder, the pet insurer 28
shall include a written disclosure with the following information, printed in twelve-point (12-point) 29
boldface type: 30
(1) The address and customer service telephone number of the pet insurer or the agent or 31
broker of record. 32
(2) If the policy was issued or delivered by an agent or broker, a statement advising the 33
policyholder to contact the broker or agent for assistance. 34
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(l) The disclosures required in this section shall be in addition to any other disclosures 1
required by law or regulation. 2
27-82-5. Policy Conditions. 3
(a) A pet insurer may issue policies that exclude coverage on the basis of one or more 4
preexisting conditions with appropriate disclosure to the consumer. The pet insurer has the burden 5
of proving that the preexisting condition exclusion applies to the condition for which a claim is 6
being made. 7
(b) A pet insurer may issue policies that impose waiting periods upon effectuation of the 8
policy that do not exceed thirty (30) days for illnesses or orthopedic conditions not resulting from 9
an accident. Waiting periods for accidents are prohibited. However, an insurer may issue coverage 10
to be effective at 12:01 a.m. on the second calendar day after the purchase, subject only to the 11
following exceptions. 12
(1) If an insurer elects to conduct individualized underwriting on a specific pet, then 13
coverage must be effective by 12:01 a.m. on the second calendar day after the insurer has 14
determined such pet is eligible for coverage. 15
(2) An insurer may delay coverage from becoming effective to establish a method for the 16
consumer or group administrator to pay the premium. 17
(3) For pet insurance coverage acquired by an individual through an employer or 18
organization, the coverage effective date of such pet insurance may be delayed to align with the 19
eligibility and effective date requirements of the employer's or organization's benefit plan. 20
(4) A pet insurer utilizing a waiting period permitted in subsection (b) of this section shall 21
include a provision in its contract that allows the waiting periods to be waived upon completion of 22
a medical examination. Pet insurers may require the examination to be conducted by a licensed 23
veterinarian after the purchase of the policy. 24
(i) A medical examination under subsection (b)(1) of this section shall be paid for by the 25
policyholder, unless the policy specifies that the pet insurer will pay for the examination. 26
(ii) A pet insurer can specify elements to be included as part of the examination and require 27
documentation thereof; provided, the specifications do not unreasonably restrict a consumer's 28
ability to waive the waiting periods in subsection (b) of this section. 29
(5) Waiting periods, and the requirements applicable to them, must be clearly and 30
prominently disclosed to consumers prior to the policy purchase. 31
(6) If a policy does not include a waiting period for an illness or orthopedic condition, an 32
insurer may set a policy effectuation date that is up to fifteen (15) calendar days after purchase, so 33
long as such policy effectuation date is clearly disclosed and no premium is charged before the 34
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policy becomes effective. 1
(c) A pet insurer must not require a veterinary examination of the covered pet for the 2
insured to have their policy renewed. 3
(d) If a pet insurer includes any prescriptive, wellness, or non-insurance benefits in the 4
policy form, then it is made part of the policy contract and must follow all applicable laws and 5
regulations in the insurance code. 6
(e) An insured's eligibility to purchase a pet insurance policy must not be based on 7
participation, or lack of participation, in a separate wellness program. 8
27-82-6. Sales practices for wellness programs. 9
(a) A pet insurer and/or producer shall not do the following: 10
(1) Market a wellness program as pet insurance; 11
(2) Market a wellness program during the sale, solicitation, or negotiation of pet insurance. 12
(b) If a wellness program is sold by a pet insurer and/or producer: 13
(1) The purchase of the wellness program shall not be a requirement to the purchase of pet 14
insurance. 15
(2) The costs of the wellness program shall be separate and identifiable from any pet 16
insurance policy sold by a pet insurer and/or producer. 17
(3) The terms and conditions for the wellness program shall be separate from any pet 18
insurance policy sold by a pet insurer and/or producer. 19
(4) The products or coverages available through the wellness program shall not duplicate 20
products or coverages available through the pet insurance policy; 21
(5) The advertising of the wellness program shall not be misleading and shall be in 22
accordance with subsection (b) of this section; and 23
(6) A pet insurer and/or producer shall clearly disclose the following to consumers, printed 24
in twelve-point (12-point) boldface type: 25
(i) That wellness programs are not insurance. 26
(ii) The address and customer service telephone number of the pet insurer or producer or 27
broker of record. 28
(c) Coverages included in the pet insurance policy contract described as "wellness" benefits 29
are insurance. 30
27-82-7. Insurance producer training. 31
(a) An insurance producer shall not sell, solicit, or negotiate a pet insurance product until 32
after the producer is appropriately licensed and has completed the required training identified in 33
subsection (c) of this section. 34
LC002296/SUB A - Page 14 of 15
(b) Insurers shall ensure that its producers are trained under subsection (c) of this section 1
and that its producers have been appropriately trained on the coverages and conditions of its pet 2
insurance products. 3
(c) The training required under this subsection shall include information on the following 4
topics: 5
(1) Preexisting conditions and waiting periods; 6
(2) The differences between pet insurance and noninsurance wellness programs; 7
(3) Hereditary disorders, congenital anomalies or disorders and chronic conditions and how 8
pet insurance policies interact with those conditions or disorders; and 9
(4) Rating, underwriting, renewal, and other related administrative topics. 10
(d) The satisfaction of the training requirements of another state that are substantially 11
similar to the provisions of subsection (c) of this section shall be deemed to satisfy the training 12
requirements in this state. 13
27-82-8. Violations. 14
Violations of this chapter shall be subject to penalties pursuant to § 42-14-16. 15
SECTION 6. This act shall take effect on January 1, 2024. 16
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LC002296/SUB A - Page 15 of 15
EXPLANATION
BY THE LEGISLATIVE COUNCIL
OF
A N A C T
RELATING TO INSURANCE -- PRODUCER LICENSING ACT
***
This act would amend the statutory provisions regarding insurance producer appointments 1
to provide for an efficient electronic process clarify language relating to insurance claims adjusters, 2
add elements to unfair discrimination prohibitions and establishes the provisions of the pet 3
insurance act. 4
This act would take effect on January 1, 2024. 5
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