SB 51 - Insurance - policy cancel- lation, penalties
Georgia Senate - 1995/1996 Sessions
SB 51 - Insurance - policy cancel- lation, penalties
Page Numbers - 1/ 2/ 3/ 4/ 5/ 6/ 7/ 8
1. Langford 29th 2. Madden 47th
Senate Comm: I&L / House Comm: Ins /
Senate Vote: Yeas 51 Nays 3
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Senate Action House
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1/11/95 Read 1st time 1/31/95
1/26/95 Favorably Reported 2/8/95
Am Committee Amend/Sub
1/27/95 Read 2nd Time 2/1/95
1/30/95 Read 3rd Time 3/8/95
1/30/95 Passed/Adopted 3/8/95
CAs Comm/Floor Amend/Sub FS/FA
3/9/95 Amend/Sub Agreed To
3/24/95 Sent To Governor
4/20/95 Signed by Governor
449 Act/Veto Number
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Code Sections amended: 33-24-1, 33-24-44, 33-24-46
SB 51 SB51/AP
SENATE BILL 51
By: Senators Langford of the 29th and Madden of the 47th
A BILL TO BE ENTITLED
AN ACT
1- 1 To amend Title 33 of the Official Code of Georgia Annotated,
1- 2 relating to insurance generally, so as to provide that the
1- 3 term "adjuster" does not include a salaried employee of an
1- 4 insurer who adjusts claims; to provide that a regular
1- 5 salaried officer or employee of an insurer or of an agent or
1- 6 subagent who performs only clerical or administrative
1- 7 services in connection with any insurance transaction and
1- 8 who is not involved in soliciting insurance or signing or
1- 9 countersigning contracts shall not be considered an agent,
1-10 subagent, counselor, or adjuster; to revise the definition
1-11 of premium; to authorize the charging of a penalty on the
1-12 refund of unearned premium with regard to the cancellation
1-13 of policies under certain conditions; to clarify what shall
1-14 be considered a nonrenewal with regard to certain property
1-15 insurance policies; to provide that individual accident and
1-16 sickness insurance policies and group or blanket accident
1-17 and sickness insurance policies shall be required to provide
1-18 basic coverage for child wellness services for any insured
1-19 child from birth through the age of five years; to authorize
1-20 the Commissioner of Insurance to define child wellness
1-21 services by regulation; to authorize certain limitations in
1-22 such coverage; to provide that such coverage shall not be
1-23 subject to deductibles; to provide for construction; to
1-24 provide for applicability; to provide for information
1-25 concerning the cost of such coverage to be supplied to the
1-26 members of the General Assembly; to provide that when a
1-27 check or money order issued in payment of certain types of
1-28 motor vehicle insurance policies is dishonored, the coverage
1-29 may be cancelled as provided in Code Section 33-24-44; to
1-30 provide that acceptance of an instrument which is so
1-31 dishonored shall constitute compliance with prepayment
1-32 requirements; to provide for matters relative to the
1-33 foregoing; to provide effective dates; to repeal conflicting
1-34 laws; and for other purposes.
1-35 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
S. B. 51
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SECTION 1.
2- 1 Title 33 of the Official Code of Georgia Annotated, relating
2- 2 to insurance, is amended by striking paragraph (1) of
2- 3 subsection (a) of Code Section 33-23-1, relating to
2- 4 definitions of terms applicable to licensing of insurance
2- 5 agents, subagents, counselors, and adjusters, and inserting
2- 6 in lieu thereof a new paragraph (1) of subsection (a) to
2- 7 read as follows:
2- 8 "(1) 'Adjuster' means any person who for a fee,
2- 9 commission, salary, or other compensation investigates,
2-10 settles, or adjusts and reports to his or her employer
2-11 or principal with respect to claims arising under
2-12 insurance contracts on behalf of the insurer or the
2-13 insured or a person who directly supervises or manages
2-14 such person. The term 'adjuster' does not include:
2-15 (A) Persons who adjust claims arising under contracts
2-16 of life or marine insurance or annuities; or
2-17 (B) An agent or a salaried employee of an agent or a
2-18 salaried employee of an insurer who adjusts or assists
2-19 in adjusting losses under policies issued by such
2-20 agent or insurer."
SECTION 2.
2-21 Said title is further amended by striking in its entirety
2-22 paragraph (1) of subsection (b) of said Code section and
2-23 inserting in lieu thereof a new paragraph (1) of subsection
2-24 (b) to read as follows:
2-25 "(1) Any regular salaried officer or employee of an
2-26 insurer or of an agent or subagent who performs only
2-27 clerical or administrative services in connection with
2-28 any insurance transaction so long as such person is not
2-29 involved in soliciting insurance, or signing or
2-30 countersigning contracts, or receiving premiums;".
SECTION 3.
2-31 Said title is further amended by striking paragraph (2) of
2-32 Code Section 33-24-1, relating to definitions, and inserting
2-33 in lieu thereof the following:
2-34 "(2) 'Premium' means the consideration for insurance, by
2-35 whatever name called. Any assessment, or any membership,
2-36 policy, survey, inspection, service, or similar fee or
2-37 charge in consideration for an insurance contract is
2-38 deemed part of the premium. The term 'premium' shall
S. B. 51
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SB 51/AP
3- 1 not include any amount deposited and held for the
3- 2 account of the insured which is returnable upon
3- 3 cancellation of the insurance contract and upon which no
3- 4 commission has been paid."
SECTION 4.
3- 5 Said title is further amended by adding a new subsection (g)
3- 6 to Code Section 33-24-44, relating to cancellation of
3- 7 insurance policies generally, to read as follows:
3- 8 "(g) Any unearned premium which has been paid by the
3- 9 insured may be refunded to the insured on other than a pro
3-10 rata basis if:
3-11 (1) The cancellation results from failure of the insured
3-12 to pay, when due, any premium to the insurer or any
3-13 amount, when due, under a premium finance agreement;
3-14 (2) The policy contains language which specifies that a
3-15 penalty may be charged on unearned premium; and
3-16 (3) The method of computing such penalty is filed with
3-17 the Commissioner in accordance with Chapter 9 of this
3-18 title."
SECTION 5.
3-19 Said title is further amended by striking paragraph (1) of
3-20 subsection (b) of Code Section 33-24-46, relating to the
3-21 cancellation or nonrenewal of certain property insurance
3-22 policies, and inserting in lieu thereof a new paragraph (1)
3-23 to read as follows:
3-24 "(1) 'Nonrenewal' or 'nonrenewed' means a refusal by a
3-25 insurer or an affiliate of an insurer to renew. Failure
3-26 of an insured to pay the premium as required of the
3-27 insured for renewal after the insurer has manifested a
3-28 willingness to renew by delivering a renewal policy,
3-29 renewal certificate, or other evidence of renewal to the
3-30 named insured or his or her representative or has
3-31 offered to issue a renewal policy, certificate, or other
3-32 evidence of renewal or has manifested such intention by
3-33 any other means shall not be construed to be a
3-34 nonrenewal."
SECTION 6.
3-35 Said title is further amended by adding immediately
3-36 following Code Section 33-29-3.2, relating to coverage for
3-37 mammograms, Pap smears, and prostate specific antigen tests
S. B. 51
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SB 51/AP
4- 1 in individual policies of accident and sickness insurance, a
4- 2 new Code Section 33-29-3.3 to read as follows:
4- 3 "33-29-3.3. (Index)
4- 4 (a) As used in this Code section, the term:
4- 5 (1) 'Child wellness services' means the periodic review
4- 6 of a child's physical and emotional status conducted by
4- 7 a physician or conducted pursuant to a physician's
4- 8 supervision, but shall not include periodic dental
4- 9 examinations or other dental services. The review shall
4-10 include a medical history, complete physical
4-11 examination, developmental assessment, appropriate
4-12 immunizations, anticipatory guidance for the parent or
4-13 parents, and laboratory testing in keeping with
4-14 prevailing medical standards.
4-15 (2) 'Policy' means any health benefit plan, contract, or
4-16 policy except a disability income policy, specified
4-17 disease policy, or hospital indemnity policy.
4-18 (b) Every insurer authorized to issue an individual
4-19 accident and sickness policy in this state shall include,
4-20 either as a part of or as a required endorsement to each
4-21 such policy issued, delivered, issued for delivery, or
4-22 renewed in this state on or after July 1, 1995, basic
4-23 coverage for child wellness services for an insured child
4-24 from birth through the age of five years. Any such policy
4-25 may provide that the child wellness services which are
4-26 rendered during a periodic review shall only be covered to
4-27 the extent that such services are provided by or under the
4-28 supervision of a single physician during the course of one
4-29 visit. The Commissioner shall define by regulation the
4-30 basic coverage for child wellness services and shall
4-31 consider the current recommendations for preventive
4-32 pediatric health care by the American Academy for
4-33 Pediatrics, prevailing medical standards, and any other
4-34 relevant data or information in the promulgation of such
4-35 regulation.
4-36 (c) The coverage required under subsection (b) of this
4-37 Code section may be subject to exclusions, reductions, or
4-38 other limitations as to coverages or coinsurance
4-39 provisions as may be approved by the Commissioner, but
4-40 shall not be subject to deductibles.
4-41 (d) Nothing in this Code section shall be construed to
4-42 prohibit the issuance of individual accident and sickness
S. B. 51
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SB 51/AP
5- 1 policies which provide benefits greater than those
5- 2 required by subsection (b) of this Code section or more
5- 3 favorable to the insured than those required by subsection
5- 4 (b) of this Code section.
5- 5 (e) The provisions of this Code section shall apply to
5- 6 individual basic or major medical accident and sickness
5- 7 insurance policies issued by a fraternal benefit society,
5- 8 a nonprofit hospital service corporation, a nonprofit
5- 9 medical service corporation, a health care corporation, a
5-10 health maintenance organization, or any similar entity.
5-11 (f) Nothing contained in this Code section shall be deemed
5-12 to prohibit the payment of different levels of benefits or
5-13 from having differences in coinsurance percentages
5-14 applicable to benefit levels for services provided by
5-15 preferred and nonpreferred providers as otherwise
5-16 authorized under the provisions of Article 2 of Chapter 30
5-17 of this title, relating to preferred provider
5-18 arrangements.
5-19 (g) Beginning July 1, 2000, the Commissioner shall conduct
5-20 a review of the cost associated with the coverage required
5-21 by this Code section and shall provide the members of the
5-22 General Assembly with such information not later than
5-23 December 31, 2000."
SECTION 7.
5-24 Said title is further amended by adding immediately
5-25 following Code Section 33-30-4.3, relating to utilization of
5-26 mail-order pharmaceutical distributors in policies, plans,
5-27 contracts, or funds, a new Code Section 33-30-4.4 to read as
5-28 follows:
5-29 "33-30-4.4. (Index)
5-30 (a) As used in this Code section, the term:
5-31 (1) 'Child wellness services' means the periodic review
5-32 of a child's physical and emotional status conducted by
5-33 a physician or conducted pursuant to a physician's
5-34 supervision, but shall not include periodic dental
5-35 examinations or other dental services. The review shall
5-36 include a medical history, complete physical
5-37 examination, developmental assessment, appropriate
5-38 immunizations, anticipatory guidance for the parent or
5-39 parents, and laboratory testing in keeping with
5-40 prevailing medical standards.
S. B. 51
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SB 51/AP
6- 1 (2) 'Policy' means any health benefit plan, contract, or
6- 2 policy except a disability income policy, specified
6- 3 disease policy, or hospital indemnity policy.
6- 4 (b) Every insurer authorized to issue a group or blanket
6- 5 accident and sickness policy in this state shall include,
6- 6 either as a part of or as a required endorsement to each
6- 7 such policy issued, delivered, issued for delivery, or
6- 8 renewed in this state on or after July 1, 1995, basic
6- 9 coverage for child wellness services for an insured child
6-10 from birth through the age of five years. Any such policy
6-11 may provide that the child wellness services which are
6-12 rendered during a periodic review shall only be covered to
6-13 the extent that such services are provided by or under the
6-14 supervision of a single physician during the course of one
6-15 visit. The Commissioner shall define by regulation the
6-16 basic coverage for child wellness services and shall
6-17 consider the current recommendations for preventive
6-18 pediatric health care by the American Academy for
6-19 Pediatrics, prevailing medical standards, and any other
6-20 relevant data or information in the promulgation of such
6-21 regulation.
6-22 (c) The coverage required under subsection (b) of this
6-23 Code section may be subject to exclusions, reductions, or
6-24 other limitations as to coverages or coinsurance
6-25 provisions as may be approved by the Commissioner, but
6-26 shall not be subject to deductibles.
6-27 (d) Nothing in this Code section shall be construed to
6-28 prohibit the issuance of group or blanket accident and
6-29 sickness policies which provide benefits greater than
6-30 those required by subsection (b) of this Code section or
6-31 more favorable to the insured than those required by
6-32 subsection (b) of this Code section.
6-33 (e) The provisions of this Code section shall apply to
6-34 group or blanket accident and sickness insurance policies
6-35 issued by a fraternal benefit society, a nonprofit
6-36 hospital service corporation, a nonprofit medical service
6-37 corporation, a health care corporation, a health
6-38 maintenance organization, or any similar entity.
6-39 (f) Nothing contained in this Code section shall be deemed
6-40 to prohibit the payment of different levels of benefits or
6-41 from having differences in coinsurance percentages
6-42 applicable to benefit levels for services provided by
6-43 preferred and nonpreferred providers as otherwise
S. B. 51
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SB 51/AP
7- 1 authorized under the provisions of Article 2 of this
7- 2 chapter, relating to preferred provider arrangements.
7- 3 (g) Beginning July 1, 2000, the Commissioner shall conduct
7- 4 a review of the cost associated with the coverage required
7- 5 by this Code section and shall provide the members of the
7- 6 General Assembly with such information not later than
7- 7 December 31, 2000."
SECTION 8.
7- 8 Said title is further amended by striking paragraph (4) of
7- 9 subsection (a) of Code Section 33-34-3, relating to
7-10 requirements concerning issuance of motor vehicle insurance
7-11 policies, and inserting in its place a new paragraph (4) of
7-12 subsection (a) to read as follows:
7-13 "(4)(A) No insurer shall issue a policy of motor
7-14 vehicle liability insurance without requiring advance
7-15 payment for the first 60 days of coverage. Insurers
7-16 may rely on the insured's statements in the policy
7-17 application for the purpose of calculating the initial
7-18 payment required by this paragraph. This paragraph
7-19 shall not apply to any renewal or continuation of a
7-20 policy, to any replacement of a policy where there is
7-21 no lapse of coverage, or to any personal automobile
7-22 policy issued in connection with an employer-sponsored
7-23 payroll deduction plan. This paragraph shall apply
7-24 only to personal automobile or family-type automobile
7-25 liability insurance policies.
7-26 (B) If an insurer, agent, or premium finance company
7-27 collects such advance payment in the form of a check
7-28 or money order which is not honored upon initial
7-29 presentation, such insurer, agent, or premium finance
7-30 company shall be deemed to have complied with
7-31 subparagraph (A) of this paragraph and may,
7-32 thereafter, cancel for nonpayment of premium as
7-33 provided in Code Section 33-24-44."
SECTION 9.
7-34 (a) Except as provided in subsection (b) of this section,
7-35 this Act shall become effective upon its approval by the
7-36 Governor or upon its becoming law without such approval.
7-37 (b) Sections 1, 3, 4, 5, 6, 7, and 8 of this Act shall
7-38 become effective on July 1, 1995.
S. B. 51
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SB 51/AP
SECTION 10.
8- 1 All laws and parts of laws in conflict with this Act are
8- 2 repealed.
S. B. 51
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Office of the Secretary of the Senate
Frank Eldridge, Jr., Secretary of the Senate
Last Updated on 01/02/97