Georgia House of Representatives - 1995/1996 Sessions

HB 405 - Insurance; adverse underwriting decision; redefine

Page Numbers - 1/ 2

1. Culbreth  132nd        2. Lord  121st


House Comm: Ins        /                Senate Comm: I&L        /               
House Vote: Yeas 159   Nays 7           Senate Vote: Yeas 45  Nays 0            
              ----------------------------------------                          
               House          Action         Senate                             
              ----------------------------------------                          
              1/26/95  Read 1st Time         2/6/95                             
              1/27/95  Read 2nd Time         2/17/95                            
              2/1/95   Favorably Reported    2/16/95                            
              2/3/95   Read 3rd Time         3/10/95                            
              2/3/95   Passed/Adopted        3/10/95                            
              3/22/95  Sent to Governor                                         
              4/20/95  Signed by Governor                                       
              471      Act/Veto Number                                          
              7/1/95   Effective Date                                           
              ----------------------------------------                          
                                                                                
Code Sections amended: 33-39-3                                                  


HB 405                                            LC 15 4030






                        A BILL TO BE ENTITLED
                               AN ACT


  1- 1  To amend Chapter 39 of Title 33 of the Official Code of
  1- 2  Georgia Annotated, relating to the collection, use, and
  1- 3  disclosure of information gathered by insurance
  1- 4  institutions, so as to revise the definition of adverse
  1- 5  underwriting decision; to provide that the placement of
  1- 6  insurance with a residual market mechanism, insurer, or
  1- 7  unauthorized insurer shall not be considered an adverse
  1- 8  underwriting decision under certain circumstances; to
  1- 9  provide for other matters relative to the foregoing; to
  1-10  repeal conflicting laws; and for other purposes.

  1-11       BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:

                         SECTION 1.

  1-12  Chapter 39 of Title 33 of the Official Code of Georgia
  1-13  Annotated, relating to the collection, use, and disclosure
  1-14  of information gathered by insurance institutions, is
  1-15  amended by striking paragraph (1) of Code Section 33-39-3,
  1-16  relating to definitions, and inserting in lieu thereof a new
  1-17  paragraph (1) to read as follows:

  1-18      "(1) 'Adverse underwriting decision' means:

  1-19        (A) Any of the following actions with respect to
  1-20        insurance transactions involving insurance coverage
  1-21        which is individually underwritten:

  1-22          (i) A declination of insurance coverage;

  1-23          (ii) A termination of insurance coverage;

  1-24          (iii) Failure of an agent to apply for insurance
  1-25          coverage with a specific insurance institution which
  1-26          the agent represents and which is requested by an
  1-27          applicant;

  1-28          (iv) In the case of a property or casualty insurance
  1-29          coverage:

  1-30            (I) Placement by an insurance institution or agent
  1-31            of a risk with a residual market mechanism, or an


                                 -1- (Index)

                                                  LC 15 4030

  2- 1            unauthorized insurer, or an insurance institution
  2- 2            which specializes in substandard risks; or

  2- 3            (II) The charging of a higher rate on the basis of
  2- 4            information which differs from that which the
  2- 5            applicant or policyholder furnished;

  2- 6          (v) In the case of a life, health, or disability
  2- 7          insurance coverage, an offer to insure at higher
  2- 8          than standard rates; or

  2- 9        (B) Notwithstanding subparagraph (A) of this
  2-10        paragraph, the following actions shall not be
  2-11        considered adverse underwriting decisions but the
  2-12        insurance institution or agent responsible for their
  2-13        occurrence shall nevertheless provide the applicant or
  2-14        policyholder with the specific reason or reasons for
  2-15        their occurrence:

  2-16          (i) The termination of an individual policy form on
  2-17          a class or state-wide basis;

  2-18          (ii) A declination of insurance coverage solely
  2-19          because such coverage is not available on a class or
  2-20          state-wide basis; or

  2-21          (iii) The rescission of a policy; or

  2-22          (iv) The accommodation of an insured by an agent who
  2-23          places insurance for such insured with any insurer,
  2-24          residual market mechanism, or unauthorized insurer
  2-25          which is satisfactory to such insured when such
  2-26          insured has been canceled, nonrenewed, declined, or
  2-27          otherwise unable to obtain coverage for any reason."

                         SECTION 2.

  2-28  All laws and parts of laws in conflict with this Act are
  2-29  repealed.














                                 -2- (Index)