A02842
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
660
Session of
2023
INTRODUCED BY SCHLOSSBERG, BURGOS, CERRATO, CIRESI, DEASY,
GIRAL, HADDOCK, HILL-EVANS, HOHENSTEIN, HOWARD, KHAN,
KINKEAD, MADDEN, McNEILL, NEILSON, PARKER, PISCIOTTANO,
PROBST, SAMUELSON, SANCHEZ, STURLA AND WEBSTER,
MARCH 21, 2023
REFERRED TO COMMITTEE ON INSURANCE, MARCH 21, 2023
AN ACT
Amending Title 40 (Insurance) of the Pennsylvania Consolidated
Statutes, in regulation of insurers and related persons
generally, providing for pet insurance; and imposing
penalties.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Part II of Title 40 of the Pennsylvania
Consolidated Statutes is amended by adding a chapter to read:
CHAPTER 45 47
PET INSURANCE
Sec.
4501 4701 . Purpose and scope of chapter.
4502 4702 . Definitions.
4503 4703 . Use of definitions in pet insurance policy.
4504 4704 . Right to examine and return pet insurance policy.
4505 4705 . Policy disclosures.
4506 4706 . Policy conditions.
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4507 4707 . Sales practices for pet insurance policies.
4508 4708 . Sales practices for wellness programs.
4509 4709 . Insurance producer training.
4510 4710 . Violations.
4511 4711 . Rules and regulations.
§ 4501 4701 . Purpose and scope of chapter.
(a) Purpose.--The purpose of this chapter is to create a
comprehensive legal framework for the sale, solicitation and
negotiation of pet insurance policies in this Commonwealth.
(b) Applicability.--This chapter applies to a pet insurance
policy that is:
(1) sold, solicited or negotiated in this Commonwealth
and issued to a resident of this Commonwealth; or
(2) delivered or issued for delivery in this
Commonwealth.
§ 4502 4702 . Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Chronic condition." A condition that can be treated or
managed, but not cured.
"Commissioner." The Insurance Commissioner of the
Commonwealth.
"Congenital anomaly or disorder." A condition that is
present from birth, whether inherited or caused by the
environment, which may cause or contribute to illness or
disease.
"Hereditary disorder." An abnormality that is genetically
transmitted from parent to offspring and may cause illness or
disease.
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"Insurance producer." As defined in section 601-A of the act
of May 17, 1921 (P.L.789, No.285), known as The Insurance
Department Act of 1921 .
"Insured." A person on whose behalf a pet insurer is
obligated to pay or reimburse covered veterinary expenses under
a pet insurance policy.
"Orthopedic condition." As follows:
(1) A condition affecting the bones, skeletal muscle,
cartilage, tendons, ligaments or joints.
(2) The term includes elbow dysplasia, hip dysplasia,
intervertebral disc degeneration, patellar luxation and
ruptured cranial cruciate ligaments.
(3) The term does not include cancer or a metabolic,
hemopoietic or autoimmune disease.
"Pet insurance policy." A property insurance policy,
certificate or rider that provides coverage for accidents and
illnesses of pets.
"Pet insurer." An insurer that issues a pet insurance
policy.
"Practice of veterinary medicine." As defined in section 3
of the act of December 27, 1974 (P.L.995, No.326), known as the
Veterinary Medicine Practice Act.
"Preexisting condition." A condition for which any of the
following apply regarding a pet prior to the effective date of a
pet insurance policy for the pet or during any waiting period:
(1) A veterinarian provided medical advice regarding the
pet.
(2) The pet received previous treatment.
(3) Based on information from verifiable sources, the
pet had signs or symptoms directly related to the condition
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for which a claim is being made.
"Renewal." The issuance and delivery of a pet insurance
policy, at the end of a pet insurance policy period, which:
(1) supersedes the pet insurance policy previously
issued and delivered by the same pet insurer or an affiliated
pet insurer; and
(2) provides types and limits of coverage substantially
similar to those contained in the pet insurance policy being
superseded.
"Renewal." As defined in section 3 of the act of July 22,
1974 (P.L.589, No.205), known as the Unfair Insurance Practices
Act.
"Veterinarian." An individual who holds a valid license to
engage in the practice of veterinary medicine from the
appropriate licensing entity of the jurisdiction in which the
individual engages in the practice of veterinary medicine.
"Veterinary expenses." The costs associated with medical
advice, diagnosis, care or treatment provided by a veterinarian,
including the cost of drugs prescribed by a veterinarian.
"Waiting period." As follows:
(1) The period of time specified in a pet insurance
policy that is required to transpire before some or all of
the coverage in the policy can begin.
(2) A waiting period may not be applied to a renewal of
existing coverage.
"Wellness program." As follows:
(1) A subscription or reimbursement-based program that
is separate from a pet insurance policy that provides goods
and services to promote the general health, safety or well-
being of the pet.
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(2) A wellness program does not assume or transfer any
risk of loss.
§ 4503 4703 . Use of definitions in pet insurance policy.
(a) Terms.--If a pet insurer uses any of the terms in
section 4502 4702 (relating to definitions) in a pet insurance
policy, the definition under section 4502 4702 shall apply and
the pet insurer shall include the definition of the term in the
pet insurance policy.
(b) Website.--A pet insurer shall make each definition
described in subsection (a) available through a clear and
conspicuous link on the main page of the publicly accessible
Internet website of the pet insurer or pet insurer's program
administrator.
(c) Construction.--Nothing in this chapter shall:
(1) prohibit or limit the types of exclusions that a pet
insurer may use in a pet insurance policy; or
(2) require a pet insurer to have any of the limitations
or exclusions described in this chapter.
§ 4504 4704 . Right to examine and return pet insurance policy.
(a) General rule.--Except as provided in subsection (b), an
individual who applies for a pet insurance policy may examine
the pet insurance policy and, if not satisfied with the pet
insurance policy for any reason, may return the pet insurance
policy to the company that produced the pet insurance policy, or
an agent or insurance producer of the company, within 15 30 days
of receipt of the pet insurance policy. The following apply:
(1) The company that produced the pet insurance policy
shall refund any premium paid by the individual regarding the
pet insurance policy within 30 days after receiving the
returned pet insurance policy.
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(2) A refunded premium shall be sent directly to the
person who paid the premium.
(3) If a pet insurance policy is returned in accordance
with this subsection, the pet insurance policy shall be void
as if it had never been issued.
(b) Exception.--Subsection (a) shall not apply if the
individual is an insured who has filed a claim under the pet
insurance policy.
(c) Notice.--Each pet insurance policy shall have the
following notice printed in at least 12-point type, which shall
be included on the first page of the pet insurance policy or
attached to the pet insurance policy:
You have 15 30 days from the day you receive this policy,
certificate or rider to review it and return it to the
company if you decide not to keep it. You do not have to
tell the company why you are returning it. If you decide
not to keep it, simply return it to the company at its
administrative office or you may return it to the agent
or insurance producer that you bought it from as long as
you have not filed a claim. You must return it within 15
30 days of the day you first received it. The company
will refund the full amount of any premium paid within 30
days after it receives the returned policy, certificate
or rider. The premium refund will be sent directly to the
person who paid it. The policy, certificate or rider will
be void as if it had never been issued.
§ 4505 4705 . Policy disclosures.
(a) Information.--A pet insurer shall clearly and
conspicuously disclose, in accordance with subsection (b), the
following information to an insured or a prospective insured in
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a pet insurance policy:
(1) Whether the pet insurance policy excludes coverage
due to any of the following:
(i) A preexisting condition.
(ii) A hereditary disorder.
(iii) A congenital anomaly or disorder.
(iv) A chronic condition.
(2) If the pet insurance policy includes any other
exclusions, the following statement: "Other exclusions may
apply. Please refer to the exclusions section of the policy
for more information."
(3) Any limitation of coverage through a waiting period
or affiliation period.
(4) Any deductible or coinsurance.
(5) The annual or lifetime policy limit of the pet
insurance policy, if any.
(6) Whether the pet insurer will reduce coverage or
increase premiums based on the insured's claim history, the
age of the covered pet or a change in the geographic location
of the insured.
(7) The name of the underwriting company if it differs
from the brand name used to market and sell the product.
(8) A summary description of the basis or formula on
which the pet insurer determines claim payments under the pet
insurance policy.
(9) If a pet insurer uses a benefit schedule to
determine claim payment under the pet insurance policy:
(i) The applicable benefit schedule in the pet
insurance policy.
(ii) All benefit schedules used by the pet insurer
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under its pet insurance policies.
(10) If a pet insurer determines claim payments under a
pet insurance policy based on usual and customary fees, or
any other reimbursement limitation based on prevailing
veterinary service provider charges:
(i) The usual and customary fee limitation provision
in the pet insurance policy that clearly describes the
pet insurer's basis for determining usual and customary
fees and how that basis is applied in calculating claim
payments.
(ii) The pet insurer's basis for determining usual
and customary fees.
(11) If any medical examination by a veterinarian is
required to effectuate coverage, the required aspects of the
examination and a statement that the examination
documentation may result in a preexisting condition
exclusion.
(12) Clear and prominent disclosure of waiting periods,
if any, and requirements applicable to them.
(b) Methods of disclosure.--
(1) A pet insurer shall prepare a separate document in
at least 12-point type that contains the information
specified under subsection (a) and in section 4504 4704
(relating to right to examine and return pet insurance
policy), which shall be titled "Insurer Disclosure of
Important Policy Provisions." The following apply:
(i) The pet insurer shall post the document through
a clear and conspicuous link on the main page of the
publicly accessible Internet website of the pet insurer
or pet insurer's program administrator.
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(ii) The pet insurer shall provide the insured a
copy of the document upon issuance or delivery of the pet
insurance policy.
(2) A pet insurer shall disclose the information
required under subsection (a)(8), (9) and (10) in the
language of the pet insurance policy itself.
(3) A pet insurer shall disclose the information
required under subsection (a)(8), (11) and (12) prior to the
issuance of the pet insurance policy.
(4) The information specified under subsection (a)(8),
(9) and (10) shall be posted through a clear and conspicuous
link on the main page of the publicly accessible Internet
website of the pet insurer or pet insurer's program
administrator.
(c) Additional information.--At the time that a pet
insurance policy is issued or delivered to an insured, the pet
insurer shall include a written disclosure with the following
information, printed in 12-point boldface type:
(1) The department's mailing address, toll-free
telephone number and website address.
(2) The address and customer service telephone number of
the pet insurer or the agent or broker of record.
(3) If the pet insurance policy was issued or delivered
by an agent or broker, a statement advising the insured to
contact the broker or agent for assistance.
(d) Other requirements.--The disclosures required in this
section shall be in addition to any other disclosure
requirements required by law or regulation.
§ 4506 4706 . Policy conditions.
(a) Preexisting conditions.--
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(1) A pet insurer may issue pet insurance policies that
exclude coverage on the basis of one or more preexisting
conditions if the pet insurer follows the disclosure
requirements of section 4505 4705 (relating to policy
disclosures).
(2) A pet insurer has the burden of proving that the
preexisting condition exclusion under paragraph (1) applies
to the condition for which a claim is being made.
(3) A condition for which coverage is afforded on a pet
insurance policy may not be considered a preexisting
condition upon any renewal of the pet insurance policy.
(b) Waiting periods.--
(1) A waiting period under a pet insurance policy for an
accident is prohibited.
(2) A waiting period under a pet insurance policy for an
illness or orthopedic condition not resulting from an
accident is permitted in accordance with the following:
(i) The waiting period may not exceed 30 days.
(ii) The waiting period, and the requirements
applicable to any waiting period, must be clearly and
prominently disclosed to a prospective insured prior to
the purchase of the pet insurance policy.
(iii) The pet insurance policy must contain a
provision that allows for the waiver of a waiting period
upon completion of a medical examination in accordance
with the following:
(A) The pet insurer may require the medical
examination to be conducted by a veterinarian.
(B) The medical examination shall be paid for by
the insured, unless the pet insurance policy
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specifies that the pet insurer will pay for the
medical examination.
(C) The pet insurer may specify elements to be
included as part of the medical examination and
require documentation regarding the medical
examination, provided that the specifications do not
unreasonably restrict the waiver.
(c) Examination not required upon renewal.--A pet insurer
may not require a veterinary examination of a pet covered under
a pet insurance policy when the insured seeks a renewal of the
pet insurance policy.
(d) Wellness benefits.--
(1) If a pet insurer includes any prescriptive, wellness
or noninsurance benefits in the pet insurance policy form,
those benefits become part of the policy contract and must
follow all applicable insurance laws and regulations.
(2) An insured's eligibility to purchase a pet insurance
policy may not be based on participation, or lack of
participation, in a separate wellness program.
(e) Acceptance.--A pet insurer shall accept a claim
submitted by an insured electronically or through physical mail.
§ 4507 4707 . Sales practices for pet insurance policies.
A pet insurer:
(1) May not make any false, deceptive or misleading
statement in the advertisement of a pet insurance policy.
(2) Shall disclose in any advertisement regarding a pet
insurance policy a statement as to whether the pet insurer
will reduce coverage or increase premiums based on:
(i) the insured's claim history;
(ii) the species or breed of the pet covered under
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the pet insurance policy;
(iii) the age of the pet covered under the pet
insurance policy; or
(iv) a change in the geographic location of the
insured.
§ 4508 4708 . Sales practices for wellness programs.
(a) Prohibitions.--A pet insurer or insurance producer may
not :
(1) Characterize a wellness program as pet insurance.
(2) Offer a wellness program at the same time as the
sale, solicitation or negotiation of a pet insurance policy.
characterize a wellness program as pet insurance.
(b) Conditions.--The sale, solicitation or negotiation of a
wellness program by a pet insurer or insurance producer shall be
in accordance with the following requirements:
(1) The purchase of the wellness program shall not be
required for the purchase of a pet insurance policy.
(2) The costs of the wellness program shall be separate
and identifiable from any pet insurance policy sold by a pet
insurer or insurance producer.
(3) The terms and conditions of the wellness program
must be separate from any pet insurance policy sold by a pet
insurer or insurance producer.
(4) The products or coverages available through the
wellness program shall not duplicate products or coverages
available through the pet insurance policy.
(5) The advertising of the wellness program shall not be
misleading and shall be in accordance with this subsection.
(6) The insured or prospective insured shall be provided
a notice containing the following information in 12-point
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boldface type:
(i) A statement that a wellness program is not
insurance.
(ii) The address and customer service telephone
number of the pet insurer or insurance producer or broker
of record.
(iii) The department's mailing address, toll-free
telephone number and website address.
(c) Construction.--If a pet insurance policy contains
coverage for benefits described as "wellness benefits," the
benefits shall be considered insurance for purposes of this
chapter.
§ 4509 4709 . Insurance producer training.
(a) Prohibitions.--An insurance producer may not sell,
solicit or negotiate a pet insurance policy or related product
unless the insurance producer is appropriately licensed in this
Commonwealth and has completed the training requirements of
subsection (c).
(b) Requirement.-- An A pet insurer shall ensure that its
insurance producers are trained under subsection (c) and have
been appropriately trained on the coverages and conditions of
its pet insurance policies and related products.
(c) Training requirements.--The training required under this
section shall include the following topics:
(1) Pets' preexisting conditions and waiting periods.
(2) The differences between pet insurance and
noninsurance wellness programs.
(3) Pets' hereditary disorders, congenital anomalies or
disorders and chronic conditions and how pet insurance
policies interact with these conditions or disorders.
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(4) Rating, underwriting, renewal and other related
administrative topics.
(d) Training in other states.--The satisfaction of the
training requirements of another state that are substantially
similar to the provisions of subsection (c) shall be deemed to
satisfy the training requirements in this Commonwealth.
§ 4510 4710 . Violations.
(a) Penalties and remedies.--Upon a determination by hearing
that this chapter has been violated, the commissioner may pursue
one or more of the following courses of action:
(1) Issue an order requiring the person in violation to
cease and desist from engaging in the violation.
(2) Suspend or revoke or refuse to issue or renew the
certificate or license of the person in violation.
(3) Impose a civil penalty of not more than $5,000 for
each violation.
(4) Impose any other penalty or remedy deemed
appropriate by the commissioner, including restitution.
(b) Other remedies.--
(1) The enforcement remedies imposed under this section
are in addition to any other remedies or penalties that may
be imposed by any other applicable statute, including the act
of July 22, 1974 (P.L.589, No.205), known as the Unfair
Insurance Practices Act.
(2) A violation of this chapter is deemed and defined by
the commissioner to be an unfair method of competition and an
unfair or deceptive act or practice in accordance with the
Unfair Insurance Practices Act.
§ 4511 4711 . Rules and regulations.
The commissioner may promulgate rules and regulations to
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administer and enforce this chapter.
Section 2. This act shall take effect in 180 days.
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