Senate File 2346 - Introduced SENATE FILE 2346 BY COMMITTEE ON COMMERCE (SUCCESSOR TO SSB 3102) A BILL FOR An Act relating to certain coverage provisions contained in 1 uninsured and underinsured motor vehicle insurance coverage. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 5549SV (2) 83 av/nh

S.F. 2346 Section 1. Section 516A.2, subsection 3, Code 2009, is 1 amended by striking the subsection and inserting in lieu 2 thereof the following: 3 3. A policy to which this chapter applies shall not include 4 any type of step-down provision or exclusion that operates to 5 reduce or eliminate uninsured or underinsured motor vehicle 6 coverage for the reason that the person is injured due to the 7 fault of a relative who is a household member insured under 8 the policy, unless the insurer also makes available a policy 9 with limits of uninsured or underinsured motor vehicle coverage 10 that are not subject to a step-down provision or exclusion as 11 described above. An insurer shall provide notice directly to 12 the named insured under a policy containing such a step-down 13 provision or exclusion that the policy contains no coverage 14 or reduced coverage for injuries if a person is injured due 15 to the fault of a relative who is a household member insured 16 under the policy, and informing the insured that coverage is 17 available which is not subject to such a step-down provision 18 or exclusion. Such notice shall be provided to the insured 19 at the time of issuance of the policy and at least annually 20 thereafter. 21 Sec. 2. Section 516A.2, Code 2009, is amended by adding the 22 following new subsections: 23 NEW SUBSECTION . 4. An insurer providing uninsured and 24 underinsured motor vehicle coverage shall make available the 25 same limits of coverage that the insurer offers for bodily 26 injury liability coverage. However, the purchaser of the 27 uninsured and underinsured motor vehicle coverage is not 28 required to purchase those same limits of coverage. 29 NEW SUBSECTION . 5. This chapter shall not be construed 30 to prohibit an insurer from including in the policy an 31 antistacking provision based on multiple policies or multiple 32 vehicles, or both. If multiple policies are applicable to an 33 injured person, the injured person shall be entitled to recover 34 pursuant to the terms of the policies, but the available amount 35 -1- LSB 5549SV (2) 83 av/nh 1/ 2

S.F. 2346 of coverage shall not be less than the single highest limit of 1 any of the applicable policies. 2 EXPLANATION 3 This bill relates to uninsured and underinsured motor 4 vehicle insurance coverage. 5 Code section 516A.2 is amended to prohibit step-down 6 provisions or exclusions in motor vehicle insurance policies 7 that operate to reduce uninsured or underinsured motor vehicle 8 coverage because a person is injured by, or while occupying 9 a vehicle being operated by, a relative as defined in Code 10 section 523I.102 or household member insured under the policy 11 unless the insurer makes available a policy that is not 12 subject to such a step-down provision or exclusion. An insurer 13 is required to notify the insured about the effect of the 14 step-down provision or exclusion and about the availability of 15 coverage without the step-down provision or exclusion. 16 The bill also requires an insurer providing uninsured and 17 underinsured motor vehicle coverage to make available the same 18 limits of coverage that the insurer offers for bodily injury 19 liability coverage. The purchaser of such coverage, however, 20 is not required to purchase those same limits of coverage. 21 The bill also provides that Code chapter 516A shall not be 22 construed to prohibit an insurer from including in a policy an 23 antistacking provision based on multiple policies or vehicles, 24 or both. If multiple policies are applicable to an injured 25 person, the injured person is entitled to recover pursuant to 26 the terms of the policies but the available amount of coverage 27 shall not be less than the single highest limit of any of the 28 applicable policies. 29 -2- LSB 5549SV (2) 83 av/nh 2/ 2