2007 SUMMARY OF NEW STATE LAWS - RHODE ISLAND

BILL #

CHAPTER #

ISSUE

BILL DESCRIPTION

HB 5023

513

Motor vehicle insurance – financial responsibility

Requires law enforcement agencies who issue tickets to motorists for lack of evidence of financial responsibility to withhold submission of the traffic citation to the traffic tribunal for one business day in order to allow the motorist the opportunity to submit evidence of financial responsibility to the issuing police department, who shall then withdraw the citation; clarifies that the motorist would not have to appear at the traffic tribunal if valid evidence of financial responsibility is submitted. Effective: October 30, 2007. (See also SB 335).

HB 5372

57

Motor vehicle insurance – auto coverage issue

Requires when an insurance carrier cancels or terminates a certified policy, notice of cancellation or termination of the insurance so certified would be filed with the division of motor vehicles. Effective: June 20, 2007.

HB 5404

341

Guaranty fund

Removes the termination date of the Rhode Island Insurers' Insolvency Fund's ability to shift money into under-funded accounts. Effective: July 6, 2007.

HB 5543

88

Guaranty fund

Increases the covered claim amount under the Rhode Island Insurers' Insolvency Fund. T1, 2008. Effective: January 1, 2008.

HB 5547

526

Motor vehicle insurance – auto body shops

Allows claimants as well as insured to choose the rental car company of their choice; clarifies the insurance card notice relating to free choice of auto body shops; provides that engaging in any act or practice of intimidation, coercion, threat or misrepresentation of consumers rights against a claimant or refusing to honor a direction to pay executed by a claimant with regards to choosing a rental car company constitutes an unfair claims practice. Effective: January 1, 2008.

HB 5549

527

Unfair Claims Practices

Makes it an unfair practice for an insurance company not to follow all components of a repair manual when appraising a damaged vehicle or refusing to compensate an auto body shop for charges as identified through industry recognized software for paint in auto body repair claims; provides that if the insured or claimant has the vehicle repaired at a shop of his choice, the insurer shall not limit the repair costs based upon the charges had the vehicle been repaired by the insurer's chosen shop. Effective: October 30, 2007.

HB 5557

291

Building codes

Allows local building inspectors that perform plan reviews and inspections for the installation of monoxide detectors to charge a specified fee for one, two, or three family units for the plan review together with any subsequent inspections. Effective: July 6, 2007.

HB 5735

142

Property insurance

Creates penalties for unlicensed individuals or entities who perform radon screening, diagnostic sampling, testing or mitigation. Effective: June 28, 2007.

HB 5740

156

Financial regulation

Expands the definition of commercial run-off insurer to include a Rhode Island domestic insurance company formed or re-activated for the purpose of entering into a voluntary restructuring whose liabilities consist of commercial liabilities transferred to the company with the approval of the commissioner. Effective: June 30, 2007.

HB 5741

85

Producer licensure – licensing requirements

Eliminates the requirement that a business entity obtain a separate insurance producers license in addition to the license obtained by the individual insurance producer; the department of business regulation may grant a written exemption to any producer who shows that he/she is not engaged in the sale, solicitation or negotiation of insurance. Such exemption shall only be valid while the insurance producer is not engaged in the sale, solicitation or negotiation of insurance. Effective: June 22, 2007.

HB 5799

313

Motor vehicle insurance – auto body shops

Requires insurers and auto body repair shops to provide written notice to a vehicle owner that he/she is entitled to either original equipment manufacturer parts (OEM parts), or non-original equipment manufacturer parts (non-OEM parts) in the repair of a motor vehicle body replacement parts. Effective: January 1, 2008.

HB 5961

46

Motor vehicle insurance – traffic offenses

Would amend the current statute conferring exclusive original jurisdiction for first offenses over the adjudication of charges of Refusal to submit to a chemical test with the Rhode Island traffic tribunal and the district court with jurisdiction over second, third and subsequent offenses. Effective: June 15, 2007.

HB 6014

193

Motor vehicle insurance – traffic offenses

Creates a new section in the general laws which specifically criminalizes the "street racing" of motor vehicles; increases the penalties for reckless driving and driving to endanger by including license suspension. Effective: July 2, 2007.

HB 6161

191

Motor vehicle insurance – traffic offenses

Increases the penalties for unlawful drinking and misrepresentation of under age persons; includes mandatory community service for all offenses and include a mandatory loss of license for thirty days for a second offense and a mandatory loss of license for three months for a third offense. Effective: July 2, 2007.

HB 6185

386

Motor vehicle insurance – traffic offenses

Provides that any person who was issued a traffic violation who seeks dismissal of the violation based on a good driving record would pay a mandatory twenty-five dollar administrative fee for court costs associated with the dismissal. Effective: July 7, 2007.

HB 6203

385

Motor vehicle insurance -- salvage title

Mandates that if the cost to repair a vehicle exceeds 75% of the fair market value before the accident and the vehicle is less than 7 years beyond the date of manufacture, the owner would return the title within 10 days to the registry to obtain a salvage title; provides that Fair market value means the retail value published in any nationally recognized publication; includes automatic databases recognized by the automobile industry to establish value of motor vehicles. Effective: July 6, 2007.

HB 6468

169

Property insurance

Requires certain notices to insurance purchasers and policyholders regarding deductibles and/or mitigation pertaining to insurance for an owner of an occupied dwelling; specifies the conditions under which an insurer may offer deductibles that are tied in to damages caused by hurricanes. Effective: July 2, 2007.

HB 6503

131

Catastrophe-related legislation

Creates the Rhode Island commission on hurricane loss projection methodology and hurricane catastrophe fund for purposes of achieving reasonable property insurance rates in light of potential hurricane disasters. Effective: January 1, 2007.

HB 6522

363

Rate regulation

Would require insurers to indicate the rate models used in their rate request filings. Effective: July 7, 2007

SB 102

430

Property insurance

Would amend various sections relative to the regulation of vicious dogs. Effective: July 6, 2007.

SB 103

431

Guaranty fund

Would remove the December 31, 2007 termination date of the Rhode Island Insurers Insolvency Fund's ability to shift money into under-funded accounts. Effective: July 6, 2007.

SB 131

267

Property insurance

Creates penalties for unlicensed individuals or entities that perform radon screening, diagnostic sampling, testing or mitigation. Effective: July 6, 2007.

SB 235

443

Producer licensure – licensing requirements

Would clarify the necessity for a surplus line broker to hold an insurance producer license, and would amend the date of filing of the tax certification to allow biennial renewals of surplus line broker licenses. Effective: July 7, 2007.

SB 241

75

Motor vehicle insurance – watercraft issues

Requires any person on water skis, a surfboard or similar device that is being towed behind a vessel and any person operating or onboard a canoe, kayak or vessel less than 14 feet in length, would be required to wear a life jacket approved by the U.S. Coast Guard. Effective: June 19, 2007.

SB 299

130

Guaranty fund

Increases the covered claim amount under the Rhode Island Insurers' Insolvency Fund from three hundred thousand dollars ($300,000) to five hundred thousand dollars ($500,000). Effective: January 1, 2008.

SB 300

31

Tort reform -- miscellaneous

Concerns commercial law; eliminates the provision of law permitting the use of a photocopy or other reasonable facsimile of an original sales slip when redeeming a rebate. Effective: June 14, 2007.

SB 302

69

Motor vehicle insurance – auto coverage issue

Requires that when an insurance carrier cancels or terminates a certified policy, notice of cancellation or termination of the insurance so certified would be filed with the division of motor vehicles. Effective: June 20, 2007.

SB 367

269

Corporate governance – company rules

Would expand the definition of commercial run-off insurer to include a Rhode Island domestic insurance company formed or re-activated for the purpose of entering into a voluntary restructuring whose liabilities consist of commercial liabilities transferred to the company with the approval of the commissioner. Effective: July 6, 2007.

SB 368

240

Corporate governance – company rules

Would set standards for insurance company boards of directors as well as certain subcommittees of the board. The proposal would also require that each insurer's corporate by- laws must not be in conflict with any of the corporate governance standards in this act and that any amendment to these by-laws must receive prior approval by the department of business regulation. Effective: July 1, 2008.

SB 386

211

Producer licensure – licensing requirements

Would eliminate the requirement that a business entity obtain a separate insurance producers license in addition to the license obtained by the individual insurance producer. This act would take effect upon passage. Effective: July 2, 2007.

SB 387

404

Adjusters

Defines "public adjusters" in accordance with the National Association of Insurance Commissioners (NAIC) Model Act; allows the insurance commissioner to set the application fees and requirements by regulation; permits licensing in accordance with national standards and allow for reciprocal licensing with other states. Effective: July 7, 2007.

SB 500

505

Civil procedure

Provides that any person, firm, or corporation which suffers damages as a result of a competitive bid for a contract not being accepted due to another person, firm, or corporation knowingly misclassifying employees as independent subcontractors may bring an action for damages. Effective: October 30, 2007.

SB 516

418

Motor vehicle insurance – auto body shops

Requires insurers and auto body repair shops to provide written notice to a vehicle owner that he or she is entitled to original equipment manufactured parts in the repair of a motor vehicle body replacement parts. Effective: January 1, 2008.

SB 665

255

Property insurance

Provides that local building inspectors would be required to conduct reviews and inspections of the installation of smoke and carbon monoxide detection in new and existing private dwellings occupied by one, two and three families. Effective: July 3, 2007.

SB 749

122

Motor vehicle insurance – traffic offenses

Would increase the penalties for unlawful drinking and misrepresentation of under age persons. This act would include mandatory community service for all offenses and include a mandatory loss of license for thirty (30) days for a second offense and a mandatory loss of license for three (3) months for a third offense. Effective: June 27, 2007.

SB 783

121

Motor vehicle insurance – traffic offenses

Would create a new section in the general laws which specifically criminalizes the "street racing" of motor vehicles. This act would also increase the penalties for reckless driving and driving to endanger by including license suspension. Effective: June 27, 2007.

SB 797

485

Motor vehicle insurance – commercial auto

Subjects Rhode Island interstate carriers to the provisions of the federal Unified Carrier Registration Act of 2005; increases the fine for non-compliance with the act; increases the application fee for new intrastate carriers to the same level currently required of other similar carriers. Effective: July 7, 2007.

SB 840

296

Motor vehicle insurance -- miscellaneous

Regulates the practice of repossessing of motor vehicles; provides a redemption provision for those who cure their default. Effective: July 7, 2007.

SB 845

42

Motor vehicle insurance – traffic offenses

Amends the current statute conferring exclusive original jurisdiction for first offenses over the adjudication of charges of refusal to submit to a chemical test with the traffic tribunal and the district court with jurisdiction over second, third and subsequent offenses. Effective: June 15, 2007.

SB 862

489

Motor vehicle insurance – salvage title

Mandates that if the cost to repair a vehicle exceeds 75% of the fair market value before the accident and the vehicle is less than 7 years beyond the date of manufacture, the owner would return the title within 10 days to the registry and obtain a salvage title. Fair market value would mean the retail value published in any nationally recognized publication including automatic databases recognized by the automobile industry to establish value of motor vehicles. Effective: July 6, 2007.

SB 1110

262

Catastrophe-related legislation

Requires hurricane insurers to provide prominent and clear notice to insurers relating to deductible details or insureds mitigation measures; provides no insurer shall non-renew an insured who has taken requested mitigating steps; provides instances when such insurer may add a deductible to windstorm coverage; provides premium credits should be applied to policies as specified in existing law; amends the State Building Code relating to hurricane, storm, and flood standards. Effective: July 3, 2007.