On Jul. 9, PEN LEG passed bill to enjoin unfair policy incentives.
PEN LEG passed SB 1092 to prohibit unfair insurance policy rebates and inducements.
Statute and Law Revisions
Add Chapter 47, PEN INS 40-47-4701 through 4706, regarding rebates, inducements.
Repeal Section 346 of The insurance company law of 1921, (PEN INS PL 682 No. 284).
Sections 645-A, 646-A of The insurance department act,(PEN INS PL 789 No. 285).
Also, Section 5(b) of the Unfair insurance practices act (PEN INS PL 589 No. 205).
Key Bill Provisions
To directly or indirectly pay, offer, or allow an inducement or rebate of premiums as part of an insurance policy agreement is deemed an unfair or deceptive legal practice.
Offer, sale, or purchase of stocks, bonds, or other securities of a company as an inducement to an insurance policy agreement is deemed to be unfair or deceptive.
Special favor or advantage in the dividends or benefits of a policy are also prohibited.
Non-cash items, pilot programs for ad campaigns, and certain tying arrangements in accordance with US Code are exempt and permitted, (12 USC 1972, 12 USC 1464(q)).
Legislative History
On Mar. 11, 2024, bill introduced in Senate; on Apr. 29, 2024, bill passed in Senate. On Apr. 30, 2024, bill introduced in the House; on Jul. 3, 2024, bill passed in House.
On Jul. 9, 2024, bill was presented to the governor for its approval and enactment.
Effectiveness
Act shall take effect in 180 days from approval by the governor.
Jul. 2024 PEN LEG Governor Approval
On Jul. 15, 2024, PEN LEG reported bill approval by governor, became Act 62 of 2024.
Act to prohibit unfair policy rebates/inducements will become effective Jan. 11, 2025.
