Text: HSB00275 Text: HSB00277 Text: HSB00200 - HSB00299 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. NEW SECTION. 515F.30 SHORT TITLE. 1 2 This division may be cited as the "Fair Access to Insurance 1 3 Requirements Plan Act", or the "FAIR Plan Act". 1 4 Sec. 2. NEW SECTION. 515F.31 PURPOSE. 1 5 The purposes of this division include all of the following: 1 6 1. To make basic property insurance available to qualified 1 7 applicants with the least possible administrative detail and 1 8 expense. 1 9 2. To establish a plan, an industry placement facility and 1 10 a joint reinsurance association for the equitable distribution 1 11 and placement of risks among insurers. 1 12 3. To utilize fully the voluntary insurance market as a 1 13 source of essential property insurance. 1 14 4. To encourage the delivery of basic property insurance 1 15 at the most reasonable cost possible, provided that insurance 1 16 pricing by the FAIR plan is actuarially self-supporting and 1 17 does not actively compete with insurance pricing in the 1 18 voluntary insurance market. 1 19 Sec. 3. NEW SECTION. 515F.32 DEFINITIONS. 1 20 1. "Basic property insurance" means insurance against 1 21 direct loss to property as defined in the standard fire policy 1 22 and extended coverage, vandalism, and malicious mischief 1 23 endorsements; homeowners insurance; and such other classes of 1 24 insurance as may be added to the FAIR plan by the 1 25 commissioner. "Basic property insurance" does not include any 1 26 of the following: 1 27 a. Automobile insurance. 1 28 b. Inland marine insurance. 1 29 2. "Insurer" includes all companies or associations 1 30 licensed to transact insurance business in this state under 1 31 chapters 515, 518, and 518A, and companies or associations 1 32 admitted or seeking to be admitted to do business in this 1 33 state under any of those chapters, notwithstanding any 1 34 provision of the Code to the contrary. 1 35 3. "Plan" means the FAIR plan to assure fair access to 2 1 insurance requirements established pursuant to section 2 2 515F.33. 2 3 Sec. 4. NEW SECTION. 515F.33 FAIR PLAN ESTABLISHED. The 2 4 FAIR plan to assure fair access to insurance requirements is 2 5 established. The plan shall operate subject to the provisions 2 6 and conditions of this division. 2 7 Sec. 5. NEW SECTION. 515F.34 MEMBERSHIP. 2 8 1. Eligibility for membership in the FAIR plan and its 2 9 underwriting association requires all of the following: 2 10 a. The insurer must be licensed to write property 2 11 insurance in this state. 2 12 b. The insurer is engaged in writing property insurance in 2 13 this state, including the property insurance components of 2 14 multiperil on a direct basis. 2 15 2. Each insurer that meets the eligibility requirements in 2 16 subsection 1 shall be required to do all of the following: 2 17 a. Automatically subscribe to the articles of agreement 2 18 for the FAIR plan and the underwriting association as a 2 19 prerequisite to authority to transact property insurance 2 20 business in this state. 2 21 b. Become and remain a member both of the FAIR plan and 2 22 the underwriting association. 2 23 c. Comply with the requirements of the FAIR plan and the 2 24 underwriting association as a condition of the insurer's 2 25 authority to transact property insurance business in this 2 26 state. 2 27 Sec. 6. NEW SECTION. 515F.35 STATUS OF PLAN. 2 28 1. The FAIR plan is not and shall not be deemed a 2 29 department, unit, agency, or instrumentality of the state. 2 30 2. All debts, claims, obligations, and liabilities 2 31 incurred by the FAIR plan shall be the debts, claims, 2 32 obligations, and liabilities of the FAIR plan only, and are 2 33 not the debts or pledges of credit of the state, or the 2 34 state's agencies, instrumentalities, officers, or employees. 2 35 3. The moneys of the FAIR plan are not part of the general 3 1 fund of the state, and the state shall not budget for or 3 2 provide general fund appropriations to the plan. 3 3 4. The records, reports, and communications of the FAIR 3 4 plan, the governing committee, the committees of the FAIR 3 5 plan, and their representatives, producers, and employees are 3 6 not public records. 3 7 Sec. 7. NEW SECTION. 515F.36 ADMINISTRATION. 3 8 1. A governing committee shall administer the FAIR plan, 3 9 subject to the supervision of the commissioner, and operated 3 10 by a manager appointed by the committee. 3 11 2. The committee shall consist of seven members, one of 3 12 whom shall be elected by the committee from each of the 3 13 following: 3 14 a. American insurance association. 3 15 b. Alliance of American insurers. 3 16 c. National association of independent insurers. 3 17 d. Iowa insurance institute. 3 18 e. Mutual insurance association of Iowa. 3 19 f. Independent insurance agents of Iowa. 3 20 g. All other insurers. 3 21 3. Not more than one insurer in a group under the same 3 22 management or ownership shall serve on the committee at the 3 23 same time. 3 24 4. The plan of operation and articles of association shall 3 25 make provision for an underwriting association having 3 26 authority on behalf of its members to cause to be issued 3 27 property insurance policies, to reinsure in whole or in part 3 28 any such policies, and to cede any such reinsurance. The plan 3 29 of operation and articles of association shall provide, among 3 30 other things, for the perils to be covered, limits of 3 31 coverage, geographical area of coverage, compensation and 3 32 commissions, assessments of members, the sharing of expenses, 3 33 income, and losses on an equitable basis, cumulative weighted 3 34 voting for the governing committee of the association, the 3 35 administration of the FAIR plan, and any other matter 4 1 necessary or convenient for the purpose of assuring fair 4 2 access to insurance requirements. 4 3 Sec. 8. NEW SECTION. 515F.37 RULES. 4 4 The commissioner shall adopt rules necessary to administer 4 5 this division. 4 6 Sec. 9. NEW SECTION. 515F.38 RETROACTIVE APPLICABILITY. 4 7 This division applies retroactively to October 7, 1968, to 4 8 validate action taken under the Iowa basic property insurance 4 9 inspection and placement program adopted by the commissioner 4 10 of insurance. 4 11 Sec. 10. Section 515F.3, unnumbered paragraph 2, Code 4 12 2003, is amended to read as follows: 4 13ThisExcept as otherwise provided in specific divisions of 4 14 this chapter, this chapter does not apply to: 4 15 Sec. 11. EFFECTIVE DATE. This Act, being deemed of 4 16 immediate importance, takes effect upon enactment. 4 17 EXPLANATION 4 18 This bill adds a new division to Code chapter 515F 4 19 regarding casualty property insurance, called the "FAIR Plan 4 20 Act", pertaining to "Fair Access to Insurance Requirements". 4 21 The bill sets forth a short title for the new division, as 4 22 well as a section detailing the purpose, and another section 4 23 for definitions. 4 24 New Code section 515F.34 provides that insurers writing 4 25 property insurance business in Iowa will be required to become 4 26 members of the new plan. 4 27 New Code section 515F.35 provides that the plan is not an 4 28 instrumentality of the state, and that the moneys of the plan 4 29 are not part of and do not come from the general fund. The 4 30 documents of the plan are not public records. The plan is 4 31 administered by a committee of seven insurance 4 32 representatives, and operated by a manager. An underwriting 4 33 association for the FAIR plan may reinsure policies as 4 34 necessary. The commissioner is empowered to adopt necessary 4 35 rules to administer the division. The bill is effective 5 1 immediately, and the division is made retroactively applicable 5 2 to October 7, 1968, in order to validate action taken under 5 3 the Iowa basic property insurance inspection and placement 5 4 program adopted by the commissioner of insurance. 5 5 An amendment is also made to Code section 515F.3 to 5 6 coordinate language within Code chapter 515F. 5 7 LSB 1191DP 80 5 8 jj/sh/8.1
Text: HSB00275 Text: HSB00277 Text: HSB00200 - HSB00299 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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