A02803
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1679
Session of
2021
INTRODUCED BY PICKETT, JUNE 23, 2021
REFERRED TO COMMITTEE ON INSURANCE, JUNE 23, 2021
AN ACT
Amending the act of May 17, 1921 (P.L.682, No.284), entitled "An
act relating to insurance; amending, revising, and
consolidating the law providing for the incorporation of
insurance companies, and the regulation, supervision, and
protection of home and foreign insurance companies, Lloyds
associations, reciprocal and inter-insurance exchanges, and
fire insurance rating bureaus, and the regulation and
supervision of insurance carried by such companies,
associations, and exchanges, including insurance carried by
the State Workmen's Insurance Fund; providing penalties; and
repealing existing laws," in automobile insurance issuance,
renewal, cancellation and refusal, providing for policy
changes.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of May 17, 1921 (P.L.682, No.284), known
as The Insurance Company Law of 1921, is amended by adding a
section to read:
Section 2006.1. Policy Changes.--(a) Notwithstanding the
definition of "renewal" or "to renew" in section 2001, an
insurer may change the types and limits of coverage at renewal
that reduce those contained in the policy being superseded if
the insurer has met the requirements of this section.
(b) An insurer may change the types and limits of coverage
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at renewal that reduce those contained in the policy being
superseded if the insurer has filed with the commissioner a
request for the proposed policy changes no fewer than ninety
(90) days prior to the effective date of the proposed changes.
The request shall, at a minimum, include the following:
(1) The proposed effective date of the proposed changes.
(2) The number of insureds within this Commonwealth who will
be affected by the proposed changes.
(3) The number of claims, evaluated on an annual basis, that
the insurer anticipates might be impacted by the proposed
changes.
(4) The total dollar value of the losses and expenses
associated with the claims identified in paragraph (3).
(5) The overall average premium increase or decrease caused
by the proposed changes.
(6) The reasons for requesting the changes.
(7) A copy of the notice of policy changes "Notice of Policy
Changes" that will be issued to the affected policyholders.
(c) The commissioner shall approve or deny the proposed
changes. In reviewing filings made under this section, the
commissioner may shall consider whether the renewal policy
provides types and limits of coverage that are substantially
equivalent to those contained in the policy being superseded and
whether the proposed changes are in the public interest. In
determining whether the proposed changes are in the public
interest, making this determination, the commissioner may
consider, but shall not be limited to, the following:
(1) The impact on the premiums and rates of the policy, with
and without the proposed changes.
(2) The number of insureds within this Commonwealth who will
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be affected by the proposed changes.
(3) The number of claims, evaluated on an annual basis, that
the insurer anticipates might be impacted by the proposed
changes.
(4) The total dollar value of the losses and expenses
associated with the claims identified in paragraph (3).
(5) Whether the proposed changes are consistent with policy
language found in the insurance market.
(6) Whether the proposed changes are sought to reflect
changes in the insurer's reinsurance coverage.
(7) Whether the proposed changes are in response to a change
in the laws of this Commonwealth.
(8) Whether the proposed notice of policy changes "Notice of
Policy Changes" meets the requirements of the notice under
subsection (d).
(9) Whether and to what extent the benefits to be provided
under the new policy are lesser in quantity and quality than the
benefits provided in the policy being superseded.
(d) No changes made in accordance with this section shall be
effective until the insurer provides the first named insured
with notice of the changes at least sixty (60) days prior to the
effective date of the changes. The notice shall be on a form
prescribed and approved by the Insurance Department and shall,
at a minimum, meet the following standards:
(1) The notice shall be in 12-point font and labeled
"Attention: Your Coverage is Changing." "Notice of Policy
Changes."
(2) The notice shall prominently state "Attention: your
coverage is changing" immediat ely below the label.
(2) (3) The notice shall include the name of the insurance
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company that issued the policy.
(3) (4) The notice shall include the policy number that is
being changed.
(4) (5) The notice shall clearly describe, in narrative
form, the changes being made to the policy . , including, but not
limited to, specifying how the change decreases coverage and to
what extent.
(5) (6) The notice shall advise the insured of possible
eligibility for insurance through the automobile assigned risk
plan.
(6) (7) The notice shall advise of the change in premium, if
any, caused by the changes made to the policy.
(7) (8) The notice shall provide a telephone number and
email address that the insured may use to contact the insurer to
obtain further information on the changes in terms and
conditions of the policy or reduction in coverage.
(e) An insurer who has filed a proposed change request may
request an administrative hearing if the commissioner denies the
filing. The hearing shall be conducted in accordance with 2
Pa.C.S. (relating to administrative law and procedure).
(f) Any filing approved by the Insurance Department under
this section shall be posted on the publicly accessible Internet
website of the Insurance Department no later than seven (7) days
after approval and shall remain available on that we bsite for
one (1) year after the renewal effective date of the filing.
Section 2. This act shall take effect in 60 days.
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