2013 -- S 0376 SUBSTITUTE A

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LC01162/SUB A

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2013

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A N A C T

RELATING TO INSURANCE

     Introduced By: Senators Bates, Picard, and Walaska

     Date Introduced: February 13, 2013

     Referred To: Senate Corporations

It is enacted by the General Assembly as follows:

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     SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended

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by adding thereto the following chapter:

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     CHAPTER 79

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LIMITED LINES TRAVEL INSURANCE ACT

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     27-79-1. Short title. -- This act shall be known and may be cited as the "Limited Lines

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Travel Insurance Model Act."

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     27-79-2. Definitions. -- As used in this chapter, the following terms shall mean:

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     (1) "Limited Lines Travel Insurance Producer" means a licensed insurance producer

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designated by an insurer as the travel insurance supervising producer as set forth in section 27-77-

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6 below.

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     (2) "Offer and disseminate" means providing general information, including a description

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of the coverage and price, as well as processing the application, collecting premiums, and

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performing other non-licensable activities permitted by the state.

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     (3) "Travel Insurance" means insurance coverage for personal risks incident to planned

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travel, including but not limited to:

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     (i) Interruption or cancellation of trip or event;

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     (ii) Loss of baggage or personal effects;

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     (iii) Damages to accommodations or rental vehicles; or

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     (iv) Sickness, accident, disability or death occurring during travel.

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     Travel insurance does not include major medical plans, which provide comprehensive

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medical protection for travelers with trips lasting six (6) months or longer, including for example,

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those working overseas as an ex-patriot or military personnel being deployed.

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     (4) "Travel Retailer" means a business entity that makes, arranges or offers travel

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services and may offer and disseminate travel insurance as a service to its customers on behalf of

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and under the direction of a limited lines travel insurance producer.

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     27-79-3. Requirements. -- (a) A travel retailer may offer and disseminate travel

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insurance only if the limited lines travel insurance producer complies with the following:

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     (1) The limited lines travel insurance producer or travel retailer provides to purchasers of

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travel insurance:

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     (i) A description of the material terms or the actual material terms of the insurance

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coverage;

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     (ii) A description of the process for filing a claim;

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     (iii) A description of the review or cancellation process for the travel insurance policy;

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and

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     (iv) The identity and contact information of the insurer and limited lines travel insurance

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producer.

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     (2) At the time of licensure, the limited lines travel insurance producer shall establish and

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maintain a register of each travel retailer that offers travel insurance on the limited lines travel

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insurance producer's behalf. The register shall be maintained and updated by the limited lines

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travel insurance producer and shall include the name, address, and contact information of the

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travel retailer and an officer or person who directs or controls the travel retailer's operations, and

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the travel retailer's federal employment identification number. The limited lines travel insurance

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producer shall submit such register to the state insurance department upon reasonable request.

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The limited lines travel insurance producer shall also certify that the travel retailer registered

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complies with applicable federal law.

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     (3) The limited lines travel insurance producer is responsible for compliance with the

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travel insurance laws, rules and regulations of the state.

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     (4) The limited lines travel insurance producer has paid all applicable insurance producer

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licensing fees.

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     (5) The limited lines travel insurance producer requires each employee of the travel

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retailer whose duties include offering and disseminating travel insurance to receive a program of

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instruction or training, which may be subject to review by the commissioner. The training

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material shall, at a minimum, contain instructions on the types of insurance offered, ethical sales

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practices, and required disclosures to prospective customers.

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     (b) Any travel retailer offering or disseminating travel insurance shall make available to

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prospective purchasers brochures or other written materials that:

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     (1) Provide the identity and contact information of the insurer and the limited lines travel

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insurance producer;

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     (2) Explain that the purchase of travel insurance is not required in order to purchase any

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other product or service from the travel retailer; and

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     (3) Explain that an unlicensed travel retailer is permitted to provide general information

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about the insurance offered by the travel insurance producer or insurer, including a description of

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the coverage and price, but is not qualified or authorized to answer technical questions about the

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terms and conditions of the insurance offered by the travel retailer or to evaluate the adequacy of

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the customer's existing insurance coverage.

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     (c) A travel retailer who is not licensed as an insurance producer may not:

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     (1) Evaluate or interpret the technical terms, benefits, and conditions of the offered travel

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insurance coverage;

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     (2) Evaluate or provide advice concerning a prospective purchaser's existing insurance

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coverage; or

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     (3) Hold himself/herself or itself out as a licensed insurer, licensed producer, or insurance

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expert.

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     27-79-4. Compensation. -- A travel retailer whose insurance-related activities, and those

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of its employees, are limited to offering and disseminating travel insurance on behalf of and under

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the direction of a limited lines travel insurance producer meeting the conditions stated in this

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chapter, is authorized to do so and receive related compensation.

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     27-79-5. Policy. -- Travel insurance may be provided under an individual policy or under

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a group or master policy.

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     27-79-6. Responsibility. -- As the insurer designee, the limited lines travel insurance

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producer is responsible for the acts of the travel retailer and shall use reasonable means to ensure

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compliance by the travel retailer with this chapter.

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     27-79-7. Enforcement. -- The limited lines travel insurance producer and any travel

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retailer offering and disseminating travel insurance under the limited lines travel insurance

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producer license shall be subject to the penalties for violations of this chapter pursuant to section

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42-14-16.

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SECTION 2. This act shall take effect ninety (90) days after enactment.

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LC01162/SUB A

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO INSURANCE

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     This act would create the limited lines travel insurance act to establish requirements for

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travel insurance producers and travel agents who facilitate the purchase of travel insurance.

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     This act would take effect ninety (90) days after enactment.

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LC01162/SUB A

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