National Conference of Insurance Legislators (NCOIL) to Review Cyber Security, International Advocacy During 2015 Spring Meeting Opener Tomorrow
Feb 26, 2015
South Carolina Insurance Director Ray Farmer will serve as keynote speaker for the opening day of the National Conference of Insurance Legislators (“NCOIL”) 2015 Spring meeting tomorrow, February 27, 2015.
A timely reminder of New York Financial Regulator Ben Lawsky’s dire warning today on large-scale computer system hacks, NCOIL is hosting a general forum tomorrow on cyber loss and insurance, in which legislators will explore how cyber-risk affects the insurance industry and discuss efforts to address emerging concerns in both the public and private sector. The session will examine the types of events about which insurers should be concerned, as well as why and how breaches of security are possible. This will include information on how regulators are addressing cyber-liability concerns and how cyber-insurance issues are playing out in the larger financial services sector. Along with a state regulator, representatives from the United States Department of Homeland Security, the Department of Defense, the American Banker’s Insurance Association and Zurich Insurance will be on hand to provide their perspectives.
Also tomorrow, NCOIL’s International Issues Task Force will meet jointly with its International Insurance Issues Committee to continue its discussion on a legislative toolkit for state advocacy. The 40-page toolkit is designed to be a resource to state legislators when speaking with federal and international officials and addresses seven key areas: (1) the success and strength of state-based regulation, (2) capital standards, (3) group supervision, (4) market conduct, (5) corporate governance, (6) covered agreements, and (7) trade agreements.
To view the toolkit, click here.
NCOIL’s Property-Casualty Insurance Committee (“Committee”) meets on Sunday, March 1 during which it will consider a proposed Model Act entitled “Regulating Insurance Requirements for Transportation Network Companies and Transportation Network Drivers” sponsored by Ohio State Representative Michael Stinziano. The proposed Model, which would pre-empt local ordinances and laws, would establish that Transportation Network Companies (“TNCs”) must provide primary liability coverage—beginning when a TNC driver is logged into the TNC’s online system and is waiting to be matched with a passenger, until the passenger is out of the vehicle at his or her destination. The proposed model calls for various disclosures to TNC drivers, as well as to passengers. It would not require private passenger auto insurance policies to cover a driver’s TNC activity.
The Committee will also consider a proposed Roofing Contractor Licensure Model Act co-sponsored by Arizona Senator Jason Rapert and Georgia State Representative Rich Golick that would establish minimum standards for roofing contracts, and would endeavor to promote fair and honest practices in the roofing services business. Among other provisions, the proposal would (1) require various disclosures, including an approximate cost estimate; (2) allow a consumer to cancel the contract, if the consumer’s insurer denies all or part of the claim; (3) require a contractor to return any payments or deposits that the consumer made to the contractor, except for cost of providing emergency services, if the consumer cancels the contract; (4) require contractors to maintain certain insurance coverages; (5) establish contractor prohibitions, penalties, and licensing requirements; and (6) allow certain exemptions.
Pursuant to NCOIL bylaws, which require NCOIL committees to review their model laws every five years for sunset or re-adoption, the Committee will consider the following at the Spring Meeting:
- Originally adopted in 2002, the NCOIL Model Act relating to the Use of Credit Information in Personal Insurance would (1) prohibit an insurer from denying, canceling, or non-renewing a policy based solely on credit information; (2) require an insurer to re-underwrite and re-rate an insured whose credit report was corrected; (3) require an insurer to notify an applicant that credit information would be used, as well as notify when an adverse action was based on credit info and what the four primary credit-related factors were; (4) indemnify insurance producers obtaining credit information/insurance scores according to an insurer’s procedures and according to applicable law and regulation; and (5) restrict a consumer reporting agency’s ability to provide or sell data submitted in conjunction with an insurance inquiry. The Model also would require insurers to give rating/underwriting relief to consumers whose credit has suffered from an extraordinary life circumstance (“ELC”), as well as prevent an insurer from considering a lack of credit experience as a negative factor. It would also address methods and timeframes for requesting and granting ELC exemptions. To date, 29 states have based their legislation and/or regulation in whole or in part on the NCOIL model.
- Adopted in 2007, the NCOIL Post-Assessment Property and Liability Insurance Guaranty Association Model Act would establish a comprehensive framework for the protection of claimants when a property casualty insurer becomes insolvent. Proposed amendments to the Model, which is similar to the National Association of Insurance Commissioners’ version, would (1) further limit how much a guaranty fund will pay for a claim and (2) more closely align the Model’s claim-filing deadline requirement to a typical 24-month state statute of limitations.
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