BUSINESS, BANKING AND INSURANCE

SENATE FILE 119 - Certified Real Estate Appraisers
SENATE FILE 180 - Abandoned Property and Property Presumed Abandoned
SENATE FILE 236 - Insurance Company Demutualization or Reorganization - Unclaimed Property
SENATE FILE 340 - Business Entities - Miscellaneous Provisions
SENATE FILE 372 - Uniform Money Services Act
SENATE FILE 375 - Tobacco Products Regulation - Miscellaneous Provisions - Appropriations
SENATE FILE 376 - Dishonored Checks, Drafts, or Orders - Surcharge
SENATE FILE 379 - Agricultural Liens
SENATE FILE 401 - Regulation of Tobacco Retailers
HOUSE FILE 215 - State Banks - Disclosure of Officer, Director, and Shareholder List
HOUSE FILE 319 - Uniform Commercial Code - Dishonored Checks - Written Demand for Payment
HOUSE FILE 339 - Snowmobile Franchises - Termination - Franchisee Payment Rights
HOUSE FILE 395 - Consumer Credit Transactions - Extensions of Credit
HOUSE FILE 446 - Equipment Dealership Agreements
HOUSE FILE 456 - Electronic Transactions - Computer Information Agreements - Choice of Law
HOUSE FILE 502 - Motor Vehicle Damage Disclosure Statements
HOUSE FILE 543 - Insurance - Mammography Exam Coverage
HOUSE FILE 599 - Property Insurance Access Regulation
HOUSE FILE 647 - Insurance - Miscellaneous Provisions

RELATED LEGISLATION

SENATE FILE 97 - Transportation and Transportation-Related Regulation

SEE TRANSPORTATION. This Act contains provisions relating to the perfection and recording of security interests in motor vehicles, titling of foreign registered motor vehicles acquired by dealers, and motor vehicle installment contracts. The Act amends Code language affecting the establishment and applicability of motor carrier safety rules and weight limits for vehicles transporting construction machinery. New Code sections are enacted relating to tariffs charged by motor carriers of household goods and agency tariffs.

SENATE FILE 155 - Substantive Code Corrections

SEE STATE GOVERNMENT. This Act contains statutory corrections that include changes relating to public funds deposits in financial institutions, employee training and retraining programs, various economic development programs, competition by government with private enterprise, regulation of farmers markets, the organization and activities of business corporations, viatical settlement contracts and viatical settlement investment contracts, the Consumer Credit Code, licensed or certified public accountants, secured transactions under the Uniform Commercial Code, electronic transactions, cooperatives, and the Uniform Principal and Income Act.

SENATE FILE 386 - School Health Insurance - Study

SEE EDUCATION. This Act requires the Insurance Division of the Department of Commerce to conduct a study to review health insurance coverage for school districts and their employees, including availability, ratings practices, continuity of coverage, and the fairness and efficiency of the marketplace as it relates to such insurance. The Commissioner of Insurance is directed to select members of a School Health Insurance Reform Team and to submit a report to the General Assembly on or before January 15, 2004, regarding the team's findings and recommendations.

SENATE FILE 453 - State and Local Government Financial and Regulatory Matters - Miscellaneous Provisions

SEE APPROPRIATIONS. This Act addresses state and local government financial and regulatory matters. Legislators referred to this legislation as the "Government Reinvention Bill" during debate and discussion. Provisions establishing a State Employee Health Insurance Incentive Program and Medicaid Program changes are included.

SENATE FILE 458 - Miscellaneous Appropriations, Reductions, Revenue Adjustments, and Other Matters

SEE APPROPRIATIONS. Division VII of this Act provides that if the Treasurer of State determines that a bank fails to comply with certain collateral pledged requirements, the Treasurer of State may restrict the bank from accepting uninsured public funds.

HOUSE FILE 450 - Rule Against Perpetuities Exception - VETOED BY THE GOVERNOR

SEE CIVIL LAW, PROCEDURE & COURT ADMINISTRATION. This bill would have created an exception to the statutory rule against perpetuities codified in Code Section 558.68. The bill would have allowed a creator of a trust to suspend application of the rule, but only if the trustee had the power to sell all trust assets or if one or more persons had the power to terminate the trust. The bill allowed suspension of the rule in situations where an employer created a stock bonus plan, pension plan, disability or death benefit plan, or profit sharing plan for the benefit of the employer's employees.

HOUSE FILE 504 - Fraudulent Use of Credit Cards and Payment Card Scanning Devices or Reencoders

SEE CRIMINAL LAW, PROCEDURE & CORRECTIONS. This Act relates to the criminal offense of fraudulent use of a credit card, scanning device, or reencoder.

HOUSE FILE 616 - Cemetery or Funeral Merchandise and Funeral Services - Cancellation or Purchase Agreements

SEE STATE GOVERNMENT. This Act prohibits a cancellation penalty upon cancellation of a purchase agreement for cemetery merchandise, funeral merchandise, funeral services, or a combination thereof.

HOUSE FILE 634 - Regulation of Cooperative Associations

SEE AGRICULTURE. This Act provides that an existing cooperative association originally organized under Code Chapter 490 or 491 as a business corporation may reorganize under Code Chapter 499, which is the modern chapter governing the organization and administration of cooperative associations.

HOUSE FILE 654 - Sales and Use Taxes - Sand Handling and Core and Mold Making Equipment

SEE TAXATION. This Act exempts core and mold making equipment and sand handling equipment used by a foundry in the mold making process from the sales and use taxes. The exemption applies retroactively to July 1, 1997. Refund claims are limited and paid over five fiscal years.

HOUSE FILE 683 - Miscellaneous Appropriations and Revisions, Sales and Use Tax Revisions, Criminal Code Revisions, and Other Changes

SEE APPROPRIATIONS. This Act relates to economic development, financial, and taxation matters, revises previously enacted appropriations, and includes funding for business development, and provisions relating to issuance of funding agreements by life insurance companies and liens on manufactured housing.

HOUSE FILE 692 - Taxation, Economic Growth and Development, and Other Changes - Liability Reform, Workers' and Unemployment Compensation, and Financing Charges

SEE TAXATION. Division XVII of the Act modifies several Code provisions relating to financial transactions.

BUSINESS, BANKING AND INSURANCE

SENATE FILE 119 - Certified Real Estate Appraisers (full text of bill)
BY COMMITTEE ON COMMERCE. This Act relates to Code requirements applicable to certified real estate appraisers. The Act provides that a certified real estate appraiser shall retain original or true copies of all written contracts, reports, and supporting data in connection with the retention of the appraiser's services for a period of five rather than three years, and shall retain all work files for a period of at least five years after preparation, or at least two years after final disposition of any judicial proceeding in which testimony was given, whichever period expires last, and additionally must either maintain custody of the appraiser's work file or make appropriate work file retention, access and retrieval arrangements with a party having custody of the work file. The Act also deletes an outdated process for issuing interim annual certifications.

SENATE FILE 180 - Abandoned Property and Property Presumed Abandoned (full text of bill)
BY COMMITTEE ON COMMERCE. This Act makes changes to Code Chapter 556 relating to the procedures for handling property that is presumed abandoned, including the following:

• Increases from $25 to $50 the value of presumed abandoned property for which a report must be submitted to the Treasurer of State and for which the treasurer must publish notice.
• Provides that the reporting requirements and the notice requirements do not apply to cashier's checks, official checks, and similar instruments.
• Specifies that a holder of presumed abandoned property is not required to use due diligence to notify owners of such property if the aggregate value is less than $50. The Treasurer of State is authorized to charge the holder a fee for failure to exercise due diligence in notifying the owners if 35 percent or more of the owner accounts are claimed within 24 months following the filing of the holder report.
• Requires that a person attempting to collect or collecting a fee or compensation for discovering presumed abandoned property be licensed as a private investigator.
• Provides that information provided in reports is confidential except for that used pursuant to the notice requirements or if consent is obtained from the owner of the property.
• Strikes obsolete language relating to publication and mailing of notices.
• Authorizes the Treasurer of State to destroy or otherwise dispose of presumed abandoned property at any time if the property has no commercial value.
• Reduces from three years to one year the time period that the Treasurer of State has to wait before selling stocks and other intangible interests in business associations that are presumed abandoned.

SENATE FILE 236 - Insurance Company Demutualization or Reorganization - Unclaimed Property (full text of bill)
BY COMMITTEE ON COMMERCE. This Act specifies that in the case of demutualization or related reorganization of an insurance company occurring on or after January 1, 2003, unclaimed insurance company demutualization proceeds are deemed abandoned the earlier of two years after the first distribution date or two years after the last contact date with the policyholder. In the case where the demutualization or related reorganization occurred prior to January 1, 2003, unclaimed insurance company demutualization proceeds are deemed abandoned two years after the first distribution date. The insurance company must submit its report on these presumed abandoned proceeds by May 1 instead of November 1.

The Act also sets the period for presuming the abandonment of unpaid wages at one year.

The provisions relating to unclaimed demutualization proceeds take effect April 21, 2003.

SENATE FILE 340 - Business Entities - Miscellaneous Provisions (full text of bill)
BY COMMITTEE ON COMMERCE. This Act applies changes made to provisions in Code Chapter 490, the Iowa Business Corporation Act, regarding director and officer duties, liability and indemnification during the 2002 Legislative Session to similar provisions in Code Chapter 491, which is the older corporation law under which Iowa mutual insurance companies and mutual insurance holding companies are organized; Code Chapter 490A, Limited Liability Companies; Code Chapter 496C, Professional Corporations; and Code Chapters 497, 498, 499, and 501, regarding various types of cooperatives.

The Act amends provisions governing the liability of persons acting in the capacity of a manager of a limited liability company under Code Chapter 490A or a director, officer, or interest holder of a cooperative under Code Chapter 497, 498, 499, or 501. Under current law, generally a person acting on behalf of one of these business entities is not held personally liable for actions of the business, except that a person may be personally liable for an act or omission that represents a breach of the duty of loyalty to the cooperative, is not in good faith, is intentional misconduct, or is a knowing violation of the law. The Act changes those standards to provide that personal liability attaches when the person receives an unwarranted financial benefit, intentionally inflicts harm to the cooperative, or commits a criminal violation.

The Act also makes related additional changes to Code Chapter 490, including the addition of a savings provision with regard to the 2002 amendments to the Iowa Business Corporation Act.

SENATE FILE 372 - Uniform Money Services Act (full text of bill)
BY COMMITTEE ON COMMERCE. This Act adopts the Uniform Money Services Act regulating money transmissions and currency exchange as Code Chapter 533C and repeals Code Chapter 533B effective October 1, 2003. The new chapter is regulated by the Superintendent of Banking of the Department of Commerce and is divided into nine articles as follows:

Article 1 establishes definitional terms used in the chapter and specifies that certain persons are not covered by the chapter.

Article 2 requires persons engaged in the business of money transmission to be licensed or be an authorized delegate under the chapter. A completed application, fee, and security are required prior to issuance of a license under the chapter. Licenses issued under this Article are renewed annually and a minimum net worth must be maintained.

Article 3 requires persons engaged in currency exchange to be licensed or be an authorized delegate under the chapter. A completed application and fee are required prior to issuance of a license for currency exchange. Licenses issued under this Article are renewed biennially.

Article 4 regulates the relationship between an authorized delegate and a person licensed under the chapter. Generally, the authorized delegate must act within the scope permitted under the contract executed by the authorized delegate and the licensee.

Article 5 authorizes the superintendent to conduct examinations, require reports and proper maintenance of records, and approve proposed changes in control of licensees. The records of the superintendent relating to the chapter may be disclosed under limited circumstances.

Article 6 requires licensees to maintain only permissible types of investments, based in part on a market value computed in accordance with generally accepted accounting principles. The chapter lists types of permissible investments.

Article 7 authorizes the superintendent to enforce the chapter through the suspension and revocation of licenses and designations of authorized delegates under the chapter, the issuance of orders to cease and desist, the assessment of civil penalties, and criminal prosecution. The Attorney General or a county attorney may assist in investigations of alleged violations of the chapter.

Article 8 provides for administrative proceedings and hearings prior to certain actions under the Act. The superintendent is allowed to adopt rules necessary for the enforcement of the chapter.

Article 9 creates a Financial Services Licensing Fund and directs that moneys deposited pursuant to the chapter be used to pay for staffing and other expenditures necessary under the Act. Moneys in the fund shall not revert to the General Fund of the State at the close of the fiscal year. Licenses issued under Code Chapter 533B remain in force until their expiration and the licensee must thereafter comply with this Act.

The Act takes effect and Code Chapter 533B is repealed October 1, 2003.

SENATE FILE 375 - Tobacco Products Regulation - Miscellaneous Provisions - Appropriations (full text of bill)
BY COMMITTEE ON JUDICIARY. This Act relates to requirements of tobacco product manufacturers under the Tobacco Master Settlement Agreement.

The Act requires each tobacco product manufacturer whose cigarettes are sold in this state to provide certification to the Director of Revenue and Finance and to the Attorney General no later than April 30, annually, that the manufacturer is either a participating manufacturer or is in compliance with the requirements for a nonparticipating manufacturer, and specifies the information to be included in the certification.

The Act directs the Director of Revenue and Finance to develop and publish on the department's Internet web site, by August 1, 2003, a directory listing of all tobacco product manufacturers that have provided current and accurate certification and all brand families listed in the certifications.

The Act prohibits the stamping, sale or importing of cigarettes that are not included in the directory.

The Act requires a nonresident or foreign nonparticipating manufacturer not registered to do business in this state as a foreign corporation or business entity, as a condition precedent to being included in and remaining in the directory, to appoint an agent in this state to act as agent for service of process purposes and provides procedures for changing the agent. If an agent is not appointed, the Secretary of State is deemed the manufacturer's agent only for the purpose of service of process, but this does not satisfy the condition precedent for inclusion or retention in the directory.

The Act requires that certain information be reported to the department, including amounts relating to a qualified escrow fund. The Act provides penalties and other relief for violations of the Act, including revocation of certain permits and licenses, criminal and civil penalties, and injunctive relief.

The Act appropriates $50,000 from the General Fund of the State to the Department of Revenue and Finance for FY 2003-2004 to implement the Act. The Act also provides for an annual appropriation to the department to enforce the Act. The Act also appropriates moneys for FY 2002-2003 to be used for payment of litigation fees incurred pursuant to the Master Settlement Agreement. The Act takes effect May 1, 2003, with the exception that the provision relating to developing and publishing an Internet web site directory applies August 1, 2003.

SENATE FILE 376 - Dishonored Checks, Drafts, or Orders - Surcharge (full text of bill)
BY COMMITTEE ON COMMERCE. This Act amends Article 3 of the Uniform Commercial Code regulating negotiable instruments (a promise to pay an amount of money payable to the bearer upon demand or at some definite time). The Act increases from $20 to $30 the surcharge that may be assessed by the holder of the instrument against checks, drafts or orders that are dishonored.

SENATE FILE 379 - Agricultural Liens (full text of bill)
BY COMMITTEE ON JUDICIARY. In 2000, the General Assembly enacted H.F. 2513 (2000 Iowa Acts, Chapter 1149) adopting Revised Article 9 of the Uniform Commercial Code (Code Chapter 554). With certain limited exceptions, new Article 9 governs the creation, priority and enforcement of creditors' consensual liens, which are defined as security interests in personal property and fixtures. Revised Article 9, like its predecessor, provides generally for the effectiveness of security agreements and the rights and duties of creditors. Much of Revised Article 9 provides for perfecting a security interest, usually accomplished by filing a financing statement. The Article provides for the contents of financing statements and the location where such financing statements must be filed (e.g., with the Secretary of State). In perfecting a security interest, a debtor is generally assured rights in the collateral superior to a security interest perfected later in time.

Prior to the revision of Article 9, liens created in statutes outside Code Chapter 554 were not affected by the provisions of Code Chapter 554. These liens include types of agricultural liens such as those for agricultural supply dealers (Code Chapter 570A), threshers and cornshellers (Code Chapter 571), and veterinarians (Code Chapter 581). These Code chapters provide that persons filing these liens enjoy superior priority. However, Revised Article 9 provides filing requirements for perfecting agricultural liens, and therefore may control issues relating to priority of conflicting security interests and liens.

This Act amends Code Chapters 570A, 571 and 581 by eliminating requirements for filing that are inconsistent with the requirements contained in Revised Article 9. The Act expressly states that the liens are agricultural liens, replaces references to lien statements with financing statements, and maintains their priority status over other security interests and liens to the extent that these liens also have been perfected as agricultural liens under Revised Article 9.

SENATE FILE 401 - Regulation of Tobacco Retailers (full text of bill)
BY COMMITTEE ON STATE GOVERNMENT. This Act relates to regulation of tobacco products and cigarette retailers. The Act provides for the transfer of certain violations by tobacco product and cigarette manufacturers from a county health department, city health department, or city to the Iowa Department of Public Health. This provision applies to violations pending on April 11, 2003, for which a penalty has not been assessed.

The Act directs the Alcoholic Beverages Division of the Department of Commerce to develop a tobacco compliance employee training program to be made available to employees and prospective employees of tobacco and cigarette retailers at no cost to the employees, prospective employees, or the retailer. The program is also to provide for periodic continuing employee training and recertification. The Act provides that if an employee of a retailer violates the provision relating to persons under legal age, the retailer is not assessed a penalty and the violation is not counted as a violation if the employee holds a certificate of completion of the program. The Act also provides for a similar bar on the penalty if the employer provides an in-house compliance training program and provides written documentation that the employee completed the program. The in-house program provision is repealed April 11, 2004. These bars on the penalty may be assessed only once in a four-year period by the retailer at the same place of business location. Senate File 458 (see Appropriations) establishes a fund to receive penalties and pay for the costs of provision of the training program.

The Act changes the penalties assessed against a retailer for violation of provisions relating to persons under legal age and sales of cigarettes or tobacco products through a vending machine.

The Act takes effect April 11, 2003.

HOUSE FILE 215 - State Banks - Disclosure of Officer, Director, and Shareholder List (full text of bill)
BY COMMITTEE ON COMMERCE, REGULATION AND LABOR. This Act eliminates the requirement that state-chartered banks make available for public inspection a list of the names, addresses and number of shares held by officers, directors and shareholders.

HOUSE FILE 319 - Uniform Commercial Code - Dishonored Checks - Written Demand for Payment (full text of bill)
BY COMMITTEE ON COMMERCE, REGULATION AND LABOR. This Act amends Code Section 554.3513 of the Uniform Commercial Code to allow an additional method of service in making written demand upon a maker, as part of the prerequisite acts prior to filing a civil action to recover damages for a check, draft or order dishonored for lack of funds or credit. As a result of the changes, the payee or holder may now communicate the demand for payment by regular mail, and support such service with an affidavit that provides presumptive evidence of the receipt of the demand by the maker. The payee or holder may also communicate the demand via the existing options of personal service or restricted certified mail.

HOUSE FILE 339 - Snowmobile Franchises - Termination - Franchisee Payment Rights (full text of bill)
BY COMMITTEE ON TRANSPORTATION. This Act provides that franchises for the merchandising of snowmobiles, or related parts and equipment, are governed by inventory repurchase requirements under Code Chapter 322D upon termination of a franchise agreement. These same requirements currently apply to farm implement, motorcycle, and all-terrain vehicle franchises not otherwise regulated under Code Chapter 322F as agricultural equipment dealers. A franchisee is entitled to payment by a franchiser of 100 percent of the net cost of new, unused, complete snowmobiles or related attachments which were purchased from the franchiser, plus transportation charges. The franchisee is also entitled to 85 percent of the net price of repair parts purchased from the franchiser, plus 5 percent of the net price of the parts if the franchisee performs handling, packing and loading of the parts. Exceptions are made based on the condition, age or obsolescence of the merchandise; evidence of ownership; the source from which the merchandise was acquired; and the franchisee's contractual right to ownership of the merchandise. Under the provisions of Code Chapter 322D, the franchisee's right to repurchase of inventory passes to the franchisee's heirs. A franchiser is civilly liable for the amount owed plus the franchisee's attorney fees for failure to comply with the repurchase requirements within 60 days after receipt of inventory.

The Act applies to continuing franchises in effect on January 1, 2003, that have no expiration date, and to franchises entered into or renewed on or after January 1, 2003, but only for snowmobiles and related parts or attachments purchased on or after January 1, 2003.

The Act takes effect April 11, 2003, and is retroactive to January 1, 2003.

HOUSE FILE 395 - Consumer Credit Transactions - Extensions of Credit (full text of bill)
BY COMMITTEE ON COMMERCE, REGULATION AND LABOR. This Act amends Code Chapter 537, the Iowa Consumer Credit Code, to prohibit discrimination by creditors against consumers due to the exercise of rights under the Iowa Consumer Credit Code or the federal Consumer Credit Protection Act. The change effectively allows creditors to consider a consumer's previous bankruptcy filing in a decision to grant credit, which consideration had been in question in Iowa after an Attorney General opinion interpreting the previous statutory prohibition against discrimination for exercising rights under "other provisions of law."

HOUSE FILE 446 - Equipment Dealership Agreements (full text of bill)
BY COMMITTEE ON COMMERCE, REGULATION AND LABOR. This Act addresses dealership agreements under Code Chapter 322F. Under Code Chapter 322F, dealership agreements generally involve agricultural equipment franchises. Under the Code chapter, a franchisor is referred to as the supplier and a franchisee is referred to as a dealership. Generally, Code Chapter 322F regulates business relationships between dealerships and suppliers by providing for the terms and conditions of dealership agreements. The Code chapter specifies rights and obligations for dealers and suppliers. The Code chapter places restrictions on supplier practices, provides for supplier liability, and provides remedies available to the dealership.

The Act extends the Code chapter's franchise provisions to cover certain other agricultural equipment, principally used in floriculture. It also extends the Code chapter's franchise provisions to cover a new class of equipment referred to as construction equipment, industrial equipment, or utility equipment. This class includes equipment associated with earthmoving, industrial material handling, mining, forestry, highway construction or maintenance, or landscaping. It also includes outdoor power equipment, which is equipment that uses small motors or engines and is used principally for outside service.

In general, the Act provides that the same requirements that apply to dealership agreements for agricultural equipment also apply to construction equipment, industrial equipment, utility equipment, and outdoor power equipment. An exception is carved out for dealership agreements involving outdoor power equipment. For example, generally grounds for termination of a dealership agreement must be by cancellation, nonrenewal, or a substantial change in competitive circumstances. However, under the Act, a substantial change in competitive circumstances is not a ground for termination for an agreement involving outdoor power equipment.

The Act also makes changes affecting equipment covered under Code Chapter 322F. A supplier must pay the dealer or credit the dealer's account with 100 percent of the net cost of all equipment used in demonstrations. It expands the right of the heirs of a dealer to require a supplier to repurchase the dealership's equipment if a person holds a majority interest in a business entity rather than only in a corporation. It also provides that upon a wrongful termination of a dealership agreement, the supplier is liable for a repurchase amount according to a schedule for termination of agreements.

The Act provides special applicability provisions for dealership agreements involving floriculture equipment and industrial and construction equipment which terminate after July 1, 2003, the Act's effective date.

HOUSE FILE 456 - Electronic Transactions - Computer Information Agreements - Choice of Law (full text of bill)
BY COMMITTEE ON COMMERCE, REGULATION AND LABOR. This Act repeals previous enactments relating to the Uniform Computer Information Transaction Act (UCITA), primarily ones that would have repealed a choice-of-law provision in Code Section 554D.104, part of the Uniform Electronic Transactions Act, and permanently retains the choice-of-law provision commonly referred to as a "bombshell" provision that protects Iowa consumers.

Under Code Section 554D.104, any choice-of-law provision is voidable that provides the contract is to be interpreted pursuant to the laws of a state that has enacted UCITA. The Act further provides that if the party against whom enforcement is sought is a resident of Iowa, the contract shall be interpreted according to the laws of Iowa.

The Act takes effect April 17, 2003.

HOUSE FILE 502 - Motor Vehicle Damage Disclosure Statements (full text of bill)
BY COMMITTEE ON LOCAL GOVERNMENT. This Act makes several changes relating to requirements for damage disclosure statements that must accompany an application for a motor vehicle certificate of title. The minimum retail amount of damage from a single incident that must be reported on the damage disclosure statement is increased from $5,000 to $6,000.

The Act provides that if a transferee acquires a vehicle by operation of law from a transferor whose state of residence does not require a damage disclosure statement, the transferee is not required to submit a damage disclosure statement from the transferor. Instead, a damage disclosure statement containing certain specified information must be submitted by the transferee with the application for title. The Act requires that a transferor must provide a copy of a separate damage disclosure document from a prior owner to the transferee at or before the time of sale if such a document is required to be furnished with the application for title.

The Act amends a provision that limits the liability of a person, authorized vehicle recycler, or licensed motor vehicle dealer to subsequent owners of a vehicle due to the damage disclosure missteps of a prior owner by also limiting the liability of such a person, recycler or dealer to subsequent drivers or passengers of a vehicle.

If the title of a vehicle with a "REBUILT" or "SALVAGE" designation indicates the vehicle was previously titled on a salvage certificate of title, the vehicle is exempt from the requirement that the total cumulative dollar amount of damage must be stated on the face of the title. New motor vehicles with a true mileage of 1,000 miles or less, which had been exempt from damage disclosure requirements, are now subject to those requirements if the vehicle has incurred damage totaling $6,000 or more in a single incident.

The Act imposes a new duty for a person selling, leasing or trading a motor vehicle, and a lessee upon termination of a lease, to disclose in writing that the vehicle contains a nonoperative airbag or that an airbag has been removed and not replaced. Senate File 458 (see Appropriations) contains a corrective amendment to this provision.

The Act provides that a person who fails to make a damage disclosure statement as required commits a fraudulent practice, the same penalty applicable to a person who makes a false damage disclosure statement under current law.

HOUSE FILE 543 - Insurance - Mammography Exam Coverage (full text of bill)
BY COMMITTEE ON COMMERCE, REGULATION AND LABOR. This Act provides that, in addition to the minimum mammography examination currently required by statute for women age 35 and above, coverage for more frequent mammograms is also required if recommended by a woman's physician.

HOUSE FILE 599 - Property Insurance Access Regulation (full text of bill)
BY COMMITTEE ON COMMERCE, REGULATION AND LABOR. This Act creates the FAIR Plan Act, relating to Fair Access to Insurance Requirements. The FAIR Plan is administered by a committee of seven insurance representatives and is operated by a manager. The plan is not an instrumentality of the state, plan moneys do not come from the General Fund of the State, and plan documents are not public records.

The Act provides that insurers writing property insurance business in Iowa are required to become members of the new plan. The Commissioner of Insurance may adopt rules as necessary to implement the Act.

The Act takes effect May 9, 2003, and is retroactively applicable to October 7, 1968, in order to validate action taken under the Iowa Basic Property Insurance Inspection and Placement Program adopted by the commissioner.

HOUSE FILE 647 - Insurance - Miscellaneous Provisions (full text of bill)
BY COMMITTEE ON COMMERCE, REGULATION AND LABOR. This Act makes numerous changes in the Code chapters that comprise the Insurance Code, including enactment of a new Interstate Insurance Product Regulation Compact.

The Act provides for continuation of health insurance coverage for an officer or enlisted person of the National Guard or organized reserves who is insured as a dependent under a group policy for accident or health insurance as a full-time student less than 25 years of age, and whose coverage would otherwise terminate while the person was temporarily serving active duty.

The Act amends several provisions to protect the confidentiality of information obtained through investigations and hearings; however, the Commissioner of Insurance is permitted to share such information with other agencies or to publish violations of statutes, rules or orders. The Act also restricts certain actions by consumer reporting agencies regarding the reuse or sale of information about a consumer obtained in the course of an insurance inquiry.

New fee requirements are instituted for foreign or domestic multiple employee welfare arrangements and limited service organizations doing business in Iowa. Other annual filing requirements for other entities are amended to require filing on or before the first day of March, and the commissioner may designate a depository other than the commissioner's office.

The Act amends various provisions in the Standard Nonforfeiture Law for Individual Deferred Annuities, including provisions relating to lump-sum settlements at maturity and minimum nonforfeiture amounts.

The Act permits funding agreements for payments to be made at future dates to be issued to a person other than a natural person for the purpose of providing collateral security for registered securities issued by that person. The Act also grants an exemption from the certification requirements of Code Section 509A.15 to certain self-insured plans by political subdivisions or school corporations. The Act changes numerous provisions regarding the commissioner's status as the registered agent for service of process for various foreign and domestic companies doing insurance business in the state. See Division III of H.F. 683 (Appropriations) for an amendment relating to funding agreements.

New Code Section 511.40 creates an insurable interest in the lives of active or retired employees for the benefit of the employer or for the benefit of the active and retired employees. The employees may be insured on an individual or group basis, and an employer must obtain consent before obtaining coverage, including an acknowledgment that the coverage may continue even after the employee is no longer employed by the employer. "Employee" includes officers, managers, directors, shareholders, partners, members, proprietors, or other owners, but for nonmanagement employees, the amount of coverage must be reasonably related to the benefit provided to the employees.

The Act amends Code Chapter 513C, the Individual Health Insurance Market Reform Act, regarding calculation of assessments for the Iowa Individual Health Benefit Reinsurance Association, and also addresses which insurers are members of the association.

Under Code Section 514J.10, the commissioner now will prepare an annual report with summary information, rather than each insurance carrier filing an individual report.

The Act provides that the external review process shall not be considered a contested case under Code Chapter 17A, the Iowa Administrative Procedure Act. The Act prohibits petitions for judicial review of independent review decisions from naming the independent review entity as a party, or from naming the commissioner as a defendant unless the commissioner's alleged action or inaction meets certain standards in statute. However, the commissioner may intervene upon motion.

A company may only write or place a policy or contract for insurance upon property located in this state through a licensed producer authorized to do business in this state.

Code Section 515B.9, regarding nonduplication of recovery for claims covered by the Insurance Guaranty Association, is rewritten to exclude consideration of any obligation of the Insurance Guaranty Association as other insurance when a claim under another policy alleges the same damages. The Code section now also expressly addresses policies that provide coverage for joint and several liability. The Act also adds a three-year statute of limitations following the date of the order of liquidation for claims brought against the Insurance Guaranty Association.

Certain filing requirements pertaining to mailings are changed from 20 to 30 days in Code Sections 515D.5, 518.23 and 518.29, and another filing requirement in Code Section 523.7 is replaced with the commissioner's authority to prescribe filing requirements by rule.

The Act repeals Code Section 511.30, related to the use of intoxication as a defense in an action on an insurance policy; Code Section 515.78, relating to an agent's certificate of authority; and Code Section 518A.43, regarding the cancellation of an insurance producer's license.

The Interstate Insurance Product Regulation Compact is added as new Code Chapter 505A. The compact is intended, in part, to create the nonprofit Interstate Insurance Product Regulation Commission and to develop uniform standards for certain insurance products. Each compacting state is entitled to one member on the commission. Procedures are set forth for filing insurance products with the commission and obtaining commission approval. The compact becomes effective and binding upon legislative enactment by two states; the approval process for insurance products, however, requires 26 compacting states or, alternatively, compacting states representing greater than 40 percent of the premium volume for life insurance, annuity, disability income, and long-term care insurance products.

The Act establishes an Individual Health Insurance Task Force to review individual health insurance market reform under Code Chapter 513C and the Iowa Comprehensive Health Insurance Association under Code Chapter 514E. The study shall include review of the premium rating system for, and qualifications for coverage under, the guaranteed basic and standard plans regulated under Code Chapter 513C and the comprehensive health insurance plans under Code Chapter 514E; the cost-sharing and assessment mechanisms under Code Sections 513C.10 and 514E.2; and other matters as agreed to by the task force which affect the individual health insurance market. A report is due to the General Assembly on or before January 15, 2004, including proposed legislation concerning individual health insurance.

The Act contains a provision regarding retroactive applicability to July 1, 1995, with respect to the amendments to Code Section 513C.10, regarding the Iowa Individual Health Benefit Reinsurance Association. Those provisions and the retroactive applicability provision take effect April 28, 2003.