SENATE BILL 1270
By Johnson
HOUSE BILL 1304
By Lamberth
HB1304
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AN ACT to amend Tennessee Code Annotated, Title 56
and Section 68-1-115, relative to insurance.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Title 56, Chapter 2, Part 1, is amended by
adding the following as a new section:
56-2-1__. Claims experience report.
(a) As used in this section, unless the context otherwise requires:
(1) "Group health plan" or "plan" means an employee welfare benefit
plan, as that term is defined in § 3(1) of the Employee Retirement Income and
Security Act of 1974 (ERISA), 29 U.S.C. § 1002(1), including insured and self-
insured plans, to the extent that the plan provides medical care, as that term is
defined in § 2791(a)(2) of the Public Health Service Act (PHS Act), 42 U.S.C.
300gg–91(a)(2), including items and services paid for as medical care, to
employees or their dependents directly or through insurance, reimbursement, or
otherwise, that:
(A) Has twenty-five (25) or more participants as defined in section
3(7) of ERISA, 29 U.S.C. § 1002(7); or
(B) Is administered by an entity other than the employer that
established and maintains the plan;
(2) "Health benefit plan issuer" means a company or insurance company,
as those terms are defined in § 56-1-102, or a health maintenance organization,
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as that term is defined in § 56-32-102, that qualifies as a health insurance entity
as that term is defined in § 56-7-109;
(3) "Plan administrator" means an administrator, as that term is defined in
29 U.S.C. § 1002(16)(A); and
(4) "Plan sponsor" has the same meaning as defined in 29 U.S.C. §
1002(16)(B).
(b) No later than thirty (30) days after a health benefit plan issuer receives a
written request for a claims experience report from a plan, plan sponsor, or plan
administrator, the health benefit plan issuer shall provide the report to the requesting
party.
(c) To the extent such information is available to the health benefit plan issuer
and is relevant to the request made under subsection (b), a report provided pursuant to
subsection (b) must include the following information for the thirty-six-month period
preceding the date of the request or for the entire period of coverage, whichever is
shorter:
(1) Aggregate paid claims experience by month, including claims
experience for medical, dental, and pharmacy benefits, as applicable;
(2) Total premiums paid by month;
(3) Total number of covered employees on a monthly basis by coverage
tier, including whether coverage was for:
(A) An employee only;
(B) An employee with dependents only;
(C) An employee with a spouse only; or
(D) An employee with spouse and dependents;
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(4) An aggregate report of all claims exceeding ten thousand dollars
($10,000); and
(5) Total dollar amount of claims pending as of the date of the request for
the report.
(d) In the case of a request made under subsection (b) after the date of
termination of coverage, the report provided under subsection (b) must contain the
information outlined in subsection (c) that is available to the health benefit plan issuer as
of the date of the request and is relevant to the request for the thirty-six-month period
preceding the date of termination of coverage or for the entire policy period, whichever
period is shorter.
(e) No later than thirty (30) days after the date of termination of coverage under
a group health plan, a health benefit plan issuer shall provide to a plan, plan sponsor, or
plan administrator who made a request under subsection (b) before the date of
termination of coverage a supplemental written report of the information described in
subsection (c) to update the claims experience report with information that was not
included in the original report.
(f) A plan, plan sponsor, or plan administrator may use information in a written
claims experience report provided under this section only as necessary to perform
treatment, payment, or health care operations as those activities are described by 45
C.F.R. § 164.501.
(g) Except where the release of information is otherwise prohibited by law, a
health benefit plan issuer that releases information in accordance with this section has
not violated a standard of care and is not liable for civil damages resulting from, and is
not subject to criminal prosecution for, releasing such information.
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SECTION 2. Tennessee Code Annotated, Section 56-2-208(b)(6)(F)(vi)(c), is amended
by deleting the language "active" and substituting "inactive".
SECTION 3. Tennessee Code Annotated, Section 56-2-208(b)(8)(C)(iii), is amended by
adding the language "; provided, that the commissioner shall not remove from the list a
reciprocal jurisdiction as defined under subdivisions (b)(8)(A)(ii)(a) or (b)" immediately preceding
the period of the first sentence.
SECTION 4. Tennessee Code Annotated, Section 56-2-208(b)(8)(D), is amended by
deleting the language "subdivision (b)(8)(B)(iv)" and substituting "subdivision (b)(8)(B)(i)(d)".
SECTION 5. Tennessee Code Annotated, Section 56-2-208(b)(10), is amended by
deleting the language "subdivision (b)(2), (b)(3), or (b)(4)" and substituting "subdivision (b)(2),
(b)(3), (b)(4), or (b)(8)".
SECTION 6. Tennessee Code Annotated, Section 56-2-208(b)(11)(B)(ii), is amended by
deleting "subdivision (b)(6)(F)" and substituting "subdivision (b)(6)(G)".
SECTION 7. Tennessee Code Annotated, Section 56-2-208(b)(11)(C), is amended by
deleting "subdivision (b)(6)(E)" and substituting "subdivision (b)(6)(F)".
SECTION 8. Tennessee Code Annotated, Section 56-2-209(a)(2), is amended by
adding the language ", as defined in subsection (d)" immediately preceding the period of the first
sentence.
SECTION 9. Tennessee Code Annotated, Section 56-2-209(a)(2)(C), is amended by
deleting the subdivision and substituting:
(C) Clean, irrevocable, unconditional letters of credit, issued or confirmed by a
qualified United States financial institution no later than December 31 of the year for
which filing is being made, and in the possession of, or in trust for, the ceding company
on or before the filing date of its annual statement; or
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SECTION 10. Tennessee Code Annotated, Section 56-2-209(b), is amended by
deleting the subsection and substituting:
(b) Letters of credit meeting applicable standards of issuer acceptability as of the
dates of their issuance, or confirmation, must, notwithstanding the issuing or confirming
qualified United States financial institution's subsequent failure to meet applicable
standards of issuer acceptability, continue to be acceptable as security until their
expiration, extension, renewal, modification, or amendment, whichever first occurs.
SECTION 11. Tennessee Code Annotated, Section 56-2-209(c), is amended by
deleting the language "subdivision (a)(3)" and substituting "subdivision (a)(2)(C) and subsection
(b)".
SECTION 12. Tennessee Code Annotated, Section 56-2-209(g)(4), is amended by
adding the following as a new subdivision (A) and redesignating the existing subdivisions
accordingly:
(A) Meets the conditions set forth in § 56-2-208(b)(8);
SECTION 13. Tennessee Code Annotated, Section 56-5-102(7), is amended by
deleting the subdivision and substituting:
(7) "Personal risk insurance" means property and casualty insurance that
provides:
(A) Insurance on one (1) to four (4) family dwelling units, including mobile
homes;
(B) Individual insurance on household goods in dwellings, mobile homes,
apartments, or other residential facilities;
(C) Insurance on private passenger nonfleet motor-driven vehicles, not
used for hire, that are used for personal or family needs, including pickups,
station wagons, vans, and vehicles with fewer than four (4) wheels;
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(D) Insurance on pleasure watercraft that are used for personal or family
needs; and
(E) Insurance sold in connection with and incidental to rental agreements
for a period not to exceed ninety (90) days;
SECTION 14. Tennessee Code Annotated, Title 56, Chapter 5, Part 1, is amended by
adding the following new section:
56-5-1__. Coverage of farm risks and property used in farming.
Coverage by a commercial risk insurance policy of farm risks or real or personal
property used in farming must not be considered in determining whether property is
classified as farm or agricultural property under another law or rule in this state.
SECTION 15. Tennessee Code Annotated, Section 56-7-1605(a), is amended by
deleting the subsection and substituting:
(a) In addition to any other requirements of law, policy forms, except as stated in
§ 56-7-1604, must not be delivered or issued for delivery in this state on or after the
dates the forms are subject to this part, unless:
(1) The text achieves a minimum score of forty (40) on the Flesch
reading ease test or an equivalent score on another comparable test as provided
in subsection (d);
(2) The style, arrangement, and overall appearance of the policy give no
undue prominence to any portion of the text of the policy or to any endorsements
or riders; and
(3) The policy form contains a table of contents or an index of the
principal sections of the policy, if the policy has more than three thousand (3,000)
words.
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SECTION 16. Tennessee Code Annotated, Section 56-7-1605(b)(1), is amended by
deleting the language "printed".
SECTION 17. Tennessee Code Annotated, Section 56-7-1605(c), is amended by
deleting the subsection and substituting:
(c) As used in this section, "text" includes all matter contained in a policy form
except the following:
(1) The name and address of the insurer; the name, number, or title of
the policy; the table of contents or index; captions and subcaptions; specification
pages, schedules, or tables; and
(2) Any policy language that is drafted to conform to the requirements of
any federal law, regulation, or agency interpretation; any policy language
required by any collectively bargained agreement; any medical terminology; any
words which are defined in the policy; and any policy language required by law
or regulation; provided, that the insurer identifies the language or terminology
excepted by this subsection (c) and certifies, in writing, that the language or
terminology is entitled to be excepted by this subsection (c).
SECTION 18. Tennessee Code Annotated, Title 56, Chapter 7, Part 23, is amended by
deleting Sections 56-7-2312 – 56-7-2322.
SECTION 19. Tennessee Code Annotated, Section 68-1-115, is amended by deleting
the language ", § 56-7-2312,".
SECTION 20. The headings in this act are for reference purposes only and do not
constitute a part of the law enacted by this act. However, the Tennessee Code Commission is
requested to include the headings in any compilation or publication containing this act.
SECTION 21. Section 1 and Sections 15 through 19 take effect upon becoming law, the
public welfare requiring it. Sections 2 through 12 take effect July 1, 2025, the public welfare
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requiring it. Sections 13 and 14 take effect January 1, 2026, and apply to plans, policies, and
agreements issued, delivered, amended, or renewed to take effect on or after January 1, 2026,
the public welfare requiring it.