House
Study
Bill
120
-
Introduced
HOUSE
FILE
_____
BY
(PROPOSED
COMMITTEE
ON
COMMERCE
BILL
BY
CHAIRPERSON
COWNIE)
A
BILL
FOR
An
Act
regulating
the
sale
of
portable
electronics
insurance,
1
including
requiring
licensure,
providing
for
fees
and
2
penalties,
and
including
effective
date
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
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Section
1.
NEW
SECTION
.
522E.1
Definitions.
1
As
used
in
this
chapter,
unless
the
context
otherwise
2
requires:
3
1.
“Commissioner”
means
the
commissioner
of
insurance.
4
2.
“Consumer”
means
a
person
who
purchases
portable
5
electronics
in
a
retail
transaction.
6
3.
“Endorsee”
means
an
unlicensed
employee
or
authorized
7
representative
of
a
licensed
portable
electronics
vendor.
8
4.
“Enrollment”
means
the
process
of
soliciting
or
accepting
9
enrollments
or
applications
from
a
consumer
under
a
portable
10
electronics
insurance
policy,
which
includes
informing
the
11
consumer
of
the
availability
of
coverage,
preparing
and
12
delivery
of
the
certificate
of
insurance
or
notice
of
proposed
13
insurance,
or
otherwise
assisting
the
consumer
in
making
an
14
informed
decision
whether
or
not
to
elect
to
purchase
portable
15
electronics
insurance.
16
5.
“Free-trial
offer”
means
an
offer
to
a
consumer
under
17
which
portable
electronics
insurance
is
provided
free
of
charge
18
for
a
limited
time
period
subsequent
to
which
a
charge
is
made
19
to
the
consumer
for
the
insurance.
20
6.
a.
“License
period”
means
all
of
that
three-year
period
21
beginning
as
described
in
paragraph
“b”
,
subparagraph
(1)
or
22
(2),
as
applicable,
and
ending
the
second
succeeding
year
on
23
the
last
calendar
day
of
the
month
in
which
the
initial
license
24
was
issued.
25
b.
A
license
period
shall
be
determined
for
each
person
as
26
follows:
27
(1)
Upon
initial
licensing,
the
license
period
shall
start
28
on
the
date
the
license
is
issued.
29
(2)
For
a
subsequent
license,
the
license
period
shall
30
start
on
the
first
day
following
the
month
in
which
the
initial
31
license
was
issued.
32
c.
A
license
shall
be
renewed
on
or
before
the
expiration
33
date
of
the
license
period.
34
7.
a.
“Portable
electronics”
means
any
of
the
following
35
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_____
devices:
1
(1)
Personal,
self-contained,
easily
carried
by
an
2
individual,
battery-operated
electronic
communication,
viewing,
3
listening,
recording,
gaming,
computing,
or
global
positioning
4
devices,
including
cell
or
satellite
phones,
pagers,
personal
5
global
positioning
satellite
units,
portable
computers,
6
portable
audio
listening,
video
viewing
or
recording
devices,
7
digital
cameras,
video
camcorders,
portable
gaming
systems,
8
docking
stations,
and
automatic
answering
devices,
including
9
their
accessories
and
service
related
to
the
use
of
the
10
devices.
11
(2)
Any
other
electronic
device
that
is
portable
in
nature
12
that
the
commissioner
approves.
13
b.
“Portable
electronics”
does
not
include
14
telecommunications
switching
equipment,
transmission
15
wires,
cell
site
transceiver
equipment,
or
other
equipment
16
and
systems
used
by
telecommunications
companies
to
provide
17
telecommunications
service
to
consumers.
18
8.
a.
“Portable
electronics
insurance”
means
a
contract
19
providing
coverage
for
the
repair
or
replacement
of
portable
20
electronics
against
any
one
or
more
of
the
following
causes
of
21
loss:
loss,
theft,
mechanical
failure,
malfunction,
damage,
or
22
other
applicable
perils.
23
b.
“Portable
electronics
insurance”
does
not
include
any
of
24
the
following:
25
(1)
A
service
contract
or
extended
warranty
providing
26
coverage
limited
to
the
repair,
replacement,
or
maintenance
of
27
property
for
the
operational
or
structural
failure
of
property
28
due
to
a
defect
in
materials,
workmanship,
accidental
damage
29
from
handling,
power
surges,
or
normal
wear
and
tear.
30
(2)
A
policy
of
insurance
covering
a
seller’s
or
a
31
manufacturer’s
obligations
under
a
warranty.
32
(3)
A
homeowner’s,
renter’s,
private
passenger
automobile,
33
commercial
multiperil,
or
similar
policy.
34
9.
“Portable
electronics
insurance
license”
means
a
document
35
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_____
issued
by
the
commissioner
pursuant
to
this
chapter
authorizing
1
a
portable
electronics
vendor
to
offer
or
sell
portable
2
electronics
insurance
in
this
state.
3
10.
“Portable
electronics
vendor”
means
any
person
in
the
4
business,
directly
or
indirectly,
of
selling,
reselling,
5
soliciting,
or
leasing
portable
electronics,
their
accessories,
6
and
related
services
to
consumers.
7
Sec.
2.
NEW
SECTION
.
522E.2
Licensure
required.
8
A
person
shall
not
offer
or
sell
any
form
of
portable
9
electronics
insurance
in
this
state
unless
the
person
is
10
licensed
as
an
insurance
producer
pursuant
to
chapter
522B,
11
is
issued
a
portable
electronics
insurance
license
pursuant
12
to
this
chapter,
or
is
an
endorsee
who
is
in
compliance
with
13
section
522E.6.
14
Sec.
3.
NEW
SECTION
.
522E.3
Portable
electronics
insurance
15
license.
16
A
portable
electronics
vendor
that
applies
for
a
license
17
and
complies
with
the
requirements
of
this
chapter
shall
18
be
issued
a
portable
electronics
insurance
license
by
the
19
commissioner
that
authorizes
the
licensee
and
the
licensee’s
20
endorsees
to
offer
or
sell
portable
electronics
insurance
to
21
a
consumer
in
connection
with,
and
incidental
to,
the
sale
of
22
portable
electronics
or
the
sale
and
provision
of
accessories
23
or
services
related
to
the
use
of
portable
electronics.
24
Sec.
4.
NEW
SECTION
.
522E.4
Application
and
fees.
25
1.
A
portable
electronics
vendor
applying
for
a
portable
26
electronics
insurance
license
under
this
chapter
shall
submit
27
all
of
the
following
to
the
commissioner:
28
a.
A
written
application
for
licensure,
signed
by
the
29
applicant
or
an
officer
of
the
applicant,
in
the
form
30
prescribed
by
the
commissioner.
31
b.
A
certificate
by
the
insurer
that
is
to
be
named
in
32
the
portable
electronics
insurance
license,
stating
that
the
33
insurer
is
satisfied
that
the
named
applicant
is
trustworthy
34
and
competent
to
act
as
a
portable
electronics
insurance
35
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_____
licensee
limited
to
this
purpose
and
that
the
insurer
will
1
appoint
the
applicant
to
act
as
its
agent
to
transact
the
kind
2
or
kinds
of
insurance
that
are
permitted
by
this
chapter
if
the
3
portable
electronics
insurance
license
applied
for
is
issued
by
4
the
commissioner.
The
certification
shall
be
subscribed
by
an
5
officer
or
managing
agent
of
the
insurer
on
a
form
prescribed
6
by
the
commissioner.
7
c.
An
application
fee
of
the
lesser
of
fifty
dollars
per
8
each
endorsee
at
a
location
of
the
vendor
or
five
hundred
9
dollars
per
location
valid
for
a
three-year
period
and,
for
10
each
three-year
period
thereafter,
a
renewal
fee
in
the
same
11
amount.
A
maximum
fee
of
five
thousand
dollars
shall
apply
12
for
licensure
of
a
portable
electronics
vendor
with
multiple
13
locations.
The
fees
collected
shall
be
deposited
as
provided
14
in
section
505.7.
15
2.
Costs
associated
with
any
enforcement
action
against
or
16
investigation
of
a
portable
electronics
vendor
licensed
under
17
this
chapter
shall
be
paid
for
by
the
portable
electronics
18
vendor.
19
Sec.
5.
NEW
SECTION
.
522E.5
License
renewal.
20
1.
Not
less
than
sixty
days
before
a
portable
electronics
21
insurance
license
will
expire,
the
commissioner
may
use
an
22
electronic
delivery
method,
including
electronic
mail
or
other
23
similar
electronic
method
of
delivery,
to
deliver,
or
may
mail,
24
to
the
latest
electronic
mail
or
mailing
address
appearing
in
25
the
commissioner’s
records,
an
application
to
the
licensee
26
to
renew
a
portable
electronics
insurance
license
for
the
27
appropriate
succeeding
license
term.
It
is
the
licensee’s
28
responsibility
to
renew
the
license,
whether
or
not
a
renewal
29
notice
is
received.
30
2.
The
commissioner
may
accept
a
late
renewal
without
31
penalty,
provided
that
the
licensee’s
failure
to
comply
is
due
32
to
a
clerical
error
or
inadvertence.
33
3.
An
application
for
renewal
of
a
portable
electronics
34
insurance
license
may
be
filed
on
or
before
the
expiration
35
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_____
date
of
the
license.
An
application
for
renewal
of
an
expired
1
license
may
be
filed
after
the
expiration
date
and
until
that
2
same
month
and
date
of
the
next
succeeding
year.
3
4.
The
commissioner
shall
impose
a
penalty
fee
equal
to
4
one-half
of
the
renewal
fee
for
the
portable
electronics
5
insurance
license
for
any
application
for
renewal
that
is
filed
6
after
the
expiration
date
of
the
license.
7
Sec.
6.
NEW
SECTION
.
522E.6
Endorsee
requirements.
8
An
endorsee
of
a
portable
electronics
vendor
that
has
been
9
issued
a
portable
electronics
insurance
license
pursuant
to
10
this
chapter
may
sell
or
offer
insurance
products
under
the
11
authority
of
the
vendor’s
portable
electronics
insurance
12
license
if
all
of
the
following
conditions
have
been
met:
13
1.
The
endorsee
is
eighteen
years
of
age
or
older.
14
2.
The
portable
electronics
vendor,
at
the
time
of
15
submission
of
an
application
for
a
portable
electronics
16
insurance
license
pursuant
to
section
522E.4,
includes
a
list
17
of
all
locations
in
this
state
at
which
the
vendor
intends
18
to
offer
coverage
under
a
policy
of
portable
electronics
19
insurance.
The
list
shall
be
maintained
by
the
portable
20
electronics
vendor
in
a
form
prescribed
by,
or
format
21
acceptable
to,
the
commissioner,
shall
be
updated
annually,
22
and
shall
be
made
available
to
the
commissioner
for
review
and
23
inspection
upon
request.
24
3.
The
portable
electronics
vendor
provides
for
the
25
training
of
its
endorsees
under
a
program
developed
by
a
26
licensed
property
and
casualty
insurance
producer
prior
to
27
allowing
its
endorsees
to
offer
or
sell
portable
electronics
28
insurance.
The
training
shall
meet
the
following
minimum
29
standards:
30
a.
Each
endorsee
shall
receive
instruction
about
the
31
applicable
kinds
or
types
of
portable
electronics
insurance
32
authorized
for
sale
to
prospective
consumers
in
this
state
as
33
provided
in
section
522E.9,
subsection
5.
34
b.
Each
endorsee
shall
receive
training
about
ethical
sales
35
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_____
practices.
1
c.
Each
endorsee
shall
receive
training
about
the
2
disclosures
to
be
given
to
prospective
consumers
pursuant
to
3
section
522E.9.
4
d.
The
retraining
of
endorsees
shall
be
conducted
whenever
5
there
is
a
material
change
in
the
insurance
products
sold
that
6
requires
modification
of
the
training
materials,
but
in
no
7
event
less
frequently
than
every
three
years
for
each
endorsee.
8
e.
The
portable
electronics
vendor
shall
maintain
a
list
9
of
its
endorsees
who
have
completed
the
required
training,
and
10
make
the
list
available
to
the
commissioner
upon
request.
11
Sec.
7.
NEW
SECTION
.
522E.7
Endorsee
conduct.
12
An
endorsee
may
act
on
behalf
of
and
under
the
supervision
of
13
a
licensed
portable
electronics
vendor
in
matters
relating
to
14
transacting
portable
electronics
insurance
under
that
vendor’s
15
license.
The
conduct
of
an
endorsee
acting
within
the
scope
of
16
the
endorsee’s
employment
or
agency
shall
be
deemed
the
conduct
17
of
the
licensed
portable
electronics
vendor
for
purposes
of
18
this
chapter.
19
Sec.
8.
NEW
SECTION
.
522E.8
Violations
and
penalties.
20
1.
If
a
licensed
portable
electronics
vendor
or
endorsee
21
violates
any
provision
of
this
chapter
or
any
other
provision
22
of
this
title,
the
commissioner
may
do
any
of
the
following:
23
a.
After
notice
and
hearing,
suspend
or
revoke
the
license
24
of
the
portable
electronics
vendor.
25
b.
After
notice
and
hearing,
impose
penalties
on
the
26
portable
electronics
vendor
for
its
conduct
or
that
of
its
27
endorsees.
28
c.
After
notice
and
hearing,
impose
other
penalties
that
the
29
commissioner
deems
necessary
and
convenient
to
carry
out
the
30
purposes
of
this
chapter,
including
suspending
the
privilege
31
of
transacting
portable
electronics
insurance
pursuant
to
32
this
chapter
at
specific
business
locations
of
the
portable
33
electronics
vendor
where
violations
have
occurred,
imposing
34
penalties
on
the
portable
electronics
vendor,
and
suspending
or
35
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revoking
the
ability
of
individual
endorsees
to
act
under
the
1
vendor’s
license.
2
2.
If
any
person
sells
insurance
in
connection
with,
or
3
incidental
to,
the
sale
of
portable
electronics
or
the
sale
4
or
provision
of
accessories
or
services
related
thereto,
or
5
holds
oneself
or
an
organization
out
as
a
licensed
portable
6
electronics
vendor
without
obtaining
the
license
required
7
by
this
chapter,
or
as
being
an
insurance
producer
licensed
8
pursuant
to
chapter
522B
without
obtaining
that
license,
the
9
commissioner
may
issue
a
cease
and
desist
order.
10
Sec.
9.
NEW
SECTION
.
522E.9
Requirements
at
time
of
sale.
11
A
licensed
portable
electronics
vendor
shall
not
sell
12
portable
electronics
insurance
pursuant
to
this
chapter
unless,
13
at
the
time
of
sale,
or
reasonably
thereafter
with
respect
to
a
14
sale
or
enrollment
occurring
by
telephone,
all
of
the
following
15
conditions
are
satisfied:
16
1.
The
portable
electronics
vendor
provides
brochures
or
17
other
written
materials
to
the
prospective
consumer
that
do
all
18
of
the
following:
19
a.
Summarize
the
material
terms
and
conditions
of
coverage
20
offered,
including
the
identity
of
the
insurer.
21
b.
Describe
the
process
for
filing
a
claim,
including
a
22
toll-free
telephone
number
to
report
a
claim.
23
c.
Disclose
any
additional
information
on
the
price,
24
benefits,
exclusions,
conditions,
or
other
limitations
of
those
25
policies
that
the
commissioner
may,
by
rule,
prescribe.
26
d.
Provide
the
name,
address,
telephone
number,
and
license
27
number
of
the
portable
electronics
vendor
or
the
property
28
and
casualty
insurance
broker-agent
appointed
by
the
insurer
29
issuing
portable
electronics
insurance
coverage
to
the
portable
30
electronics
vendor.
31
2.
The
portable
electronics
vendor
or
its
endorsees
32
make
all
of
the
following
disclosures,
which
shall
either
33
be
acknowledged
in
writing
by
the
consumer,
be
provided
in
34
writing
to
the
consumer,
or,
for
sales
made
in
person,
shall
35
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be
displayed
by
clear
and
conspicuous
signs
that
are
posted
at
1
every
location
where
portable
electronics
insurance
contracts
2
are
executed,
such
as
the
counter
where
the
consumer
signs
the
3
portable
electronics
insurance
contract:
4
a.
That
the
purchase
by
the
consumer
of
the
kinds
of
5
insurance
prescribed
in
this
chapter
is
not
required
in
order
6
to
purchase
portable
electronics,
accessories,
or
related
7
services.
8
b.
That
the
insurance
policies
offered
by
the
portable
9
electronics
vendor
may
provide
a
duplication
of
coverage
10
already
provided
by
other
insurance
policies
covering
the
11
consumer.
12
c.
That
the
vendor
or
endorsee
of
the
portable
electronics
13
vendor
is
not
qualified
or
authorized
to
evaluate
the
adequacy
14
of
the
consumer’s
existing
insurance
coverages,
unless
that
15
person
is
licensed
pursuant
to
chapter
522B.
16
d.
That
the
consumer
may
cancel
the
insurance
at
any
time.
17
If
the
consumer
cancels,
any
unearned
premium
will
be
refunded
18
in
accordance
with
applicable
law.
19
3.
The
material
terms
and
conditions
of
coverage
are
20
provided
to
every
person
who
elects
to
purchase
the
coverage.
21
4.
Costs
for
the
insurance
are
separately
itemized
in
any
22
billing
statement
for
the
insurance.
However,
if
the
portable
23
electronics
insurance
is
included
with
the
purchase
or
lease
24
of
portable
electronics
and
accessories
or
related
services,
25
the
portable
electronics
vendor
shall
clearly
and
conspicuously
26
disclose
to
the
consumer
that
the
insurance
coverage
is
27
included
with
the
purchase
of
the
portable
electronics
or
28
related
services
and
shall
disclose
the
stand-alone
cost
of
the
29
premium
for
the
same
or
similar
insurance
on
the
consumer’s
30
bill
and
in
any
marketing
materials
made
available
at
the
point
31
of
sale.
32
5.
The
portable
electronics
insurance
is
provided
under
33
an
individual
policy
issued
to
the
consumer,
or
under
a
group
34
or
master
policy
issued
to
an
organization
through
a
licensed
35
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insurance
producer
or
through
a
licensed
portable
electronics
1
vendor
by
an
insurer
authorized
to
transact
the
applicable
2
kinds
or
types
of
insurance
in
this
state.
3
6.
Portable
electronics
insurance
shall
not
be
sold
through
4
a
free-trial
offer.
5
Sec.
10.
NEW
SECTION
.
522E.10
Charges
and
collection
of
6
moneys.
7
1.
Charges
for
portable
electronics
insurance
may
be
billed
8
and
collected
by
a
licensed
portable
electronics
vendor.
A
9
licensed
vendor
shall
not
be
required
to
maintain
those
moneys
10
in
a
segregated
account
if
the
insurer
represented
by
the
11
vendor
has
provided
in
writing
that
the
moneys
need
not
be
12
segregated
from
moneys
received
by
the
portable
electronics
13
vendor
on
account
of
the
sale
or
lease
of
portable
electronics
14
or
related
services
or
accessories.
15
2.
All
moneys
received
by
a
licensed
portable
electronics
16
vendor
from
a
consumer
for
the
sale
of
portable
electronics
17
insurance
shall
be
considered
moneys
held
in
trust
by
the
18
portable
electronics
vendor
in
a
fiduciary
capacity
for
the
19
benefit
of
the
insurer.
A
licensed
portable
electronics
vendor
20
may
receive
compensation
for
billing
and
collection
services.
21
Sec.
11.
NEW
SECTION
.
522E.11
Other
restrictions.
22
1.
Under
the
authority
of
a
portable
electronics
insurance
23
license,
a
portable
electronics
vendor
shall
not
do
any
of
the
24
following:
25
a.
Offer
to
sell
insurance
except
in
conjunction
with,
and
26
incidental
to,
the
business
of
selling
portable
electronics,
27
their
accessories,
or
related
services.
28
b.
Advertise,
represent,
or
otherwise
portray
itself
or
29
its
endorsees
as
licensed
insurers
or
property
and
casualty
30
insurance
broker-agents.
31
c.
Pay
an
endorsee
compensation
based
primarily
on
the
32
number
of
consumers
electing
coverage
under
the
portable
33
electronics
vendor’s
license.
However,
this
chapter
does
34
not
prohibit
the
payment
of
compensation
to
an
endorsee
35
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of
a
portable
electronics
vendor
for
activities
under
the
1
vendor’s
license
that
is
incidental
to
the
endorsee’s
overall
2
compensation.
The
incidental
compensation
shall
not
exceed
3
fifteen
dollars
per
transaction
for
portable
electronics
4
insurance
coverage.
5
2.
Unless
lawfully
transacting
the
business
of
insurance
6
pursuant
to
a
certificate
of
authority
issued
for
the
7
appropriate
class
of
insurance,
a
person
obligated
to
perform
8
under
a
contract
offered
in
or
from
this
state
that
meets
the
9
definition
of
portable
electronics
insurance
shall
be
deemed
to
10
be
unlawfully
transacting
the
business
of
insurance.
11
Sec.
12.
NEW
SECTION
.
522E.12
Policy
forms.
12
An
insurer
that
provides
insurance
to
be
sold
by
a
licensed
13
portable
electronics
vendor
shall
file
a
copy
of
the
policy
14
form
issued
to
a
consumer,
or
of
any
policy
or
certificate
15
issued
under
a
group
or
master
policy
to
an
organization
16
through
an
insurance
producer
licensed
under
chapter
522B
17
or
through
a
licensed
portable
electronics
vendor,
with
the
18
commissioner,
who
shall
make
the
policy
form
available
to
the
19
public.
20
Sec.
13.
NEW
SECTION
.
522E.13
Portable
electronics
21
insurance
policy
changes.
22
1.
An
insurer
may
terminate
a
portable
electronics
23
insurance
policy
or
otherwise
change
the
terms
and
conditions
24
of
a
portable
electronics
insurance
policy
only
upon
25
providing
the
licensed
portable
electronics
vendor
that
is
26
the
policyholder
and
enrolled
consumers
with
at
least
thirty
27
calendar
days’
written
notice.
28
2.
If
the
insurer
changes
the
terms
and
conditions
of
a
29
policy
of
portable
electronics
insurance,
the
insurer
shall
30
provide
the
licensed
portable
electronics
vendor
that
is
the
31
policyholder
with
a
revised
policy
or
endorsement
and
each
32
enrolled
consumer
with
a
revised
certificate,
endorsement,
33
updated
brochure,
or
other
evidence
indicating
that
a
change
34
in
the
terms
and
conditions
of
the
policy
has
occurred
and
a
35
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summary
of
those
changes.
1
3.
Notwithstanding
subsection
1,
an
insurer
may
terminate
2
an
enrolled
consumer’s
enrollment
under
a
portable
electronics
3
insurance
policy
upon
fifteen
calendar
days’
notice
for
4
discovery
of
fraud
or
material
misrepresentation
in
obtaining
5
coverage
or
in
the
presentation
of
a
claim
under
the
policy.
6
4.
Notwithstanding
subsection
1,
an
insurer
may
immediately
7
terminate
an
enrolled
consumer’s
enrollment
under
a
portable
8
electronics
insurance
policy
without
prior
notice
for
any
of
9
the
following
reasons:
10
a.
Nonpayment
of
premium.
11
b.
If
the
enrolled
consumer
ceases
to
have
an
active
service
12
with
the
licensed
portable
electronics
vendor
that
is
the
13
policyholder.
14
c.
If
the
enrolled
consumer
exhausts
the
aggregate
limit
of
15
liability,
if
any,
under
the
terms
of
the
portable
electronics
16
insurance
policy
and
the
insurer
sends
notice
of
termination
17
to
the
enrolled
consumer
within
thirty
calendar
days
after
18
exhaustion
of
the
limit.
However,
if
notice
is
not
sent
within
19
thirty
calendar
days,
enrollment
shall
continue
notwithstanding
20
the
aggregate
limit
of
liability
until
thirty
calendar
days
21
from
the
date
the
insurer
sends
notice
of
termination
to
the
22
enrolled
consumer.
23
5.
If
a
portable
electronics
insurance
policy
is
terminated
24
by
the
licensed
portable
electronics
vendor
that
is
the
25
policyholder,
the
portable
electronics
vendor
shall
mail
or
26
deliver
a
written
notice
to
each
enrolled
consumer
advising
27
the
enrolled
consumer
of
the
termination
of
the
policy
and
the
28
effective
date
of
termination.
The
written
notice
shall
be
29
mailed
or
delivered
by
the
portable
electronics
vendor
to
the
30
enrolled
consumer
at
least
thirty
calendar
days
prior
to
the
31
termination.
However,
if
the
notice
is
not
sent
within
thirty
32
calendar
days,
enrollment
shall
continue
until
thirty
calendar
33
days
from
the
date
the
portable
electronics
vendor
sends
notice
34
of
termination
to
the
enrolled
consumer
or
until
a
new
portable
35
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electronics
insurance
policy
is
in
effect.
1
6.
Whenever
notice
or
correspondence
with
respect
to
a
2
policy
of
portable
electronics
insurance
is
required
pursuant
3
to
this
section,
it
shall
be
in
writing
and
sent
within
the
4
notice
period
required
pursuant
to
this
section.
Notices
5
and
correspondence
shall
be
sent
to
the
licensed
portable
6
electronics
vendor
that
is
the
policyholder
at
the
portable
7
electronics
vendor’s
mailing
address
specified
for
that
purpose
8
and
to
its
affected
enrolled
consumers’
last
known
mailing
9
addresses
on
file
with
the
insurer
or
the
portable
electronics
10
vendor.
The
insurer
or
portable
electronics
vendor
shall
11
maintain
proof
that
the
notice
or
correspondence
was
sent
for
12
not
less
than
three
years
after
that
notice
or
correspondence
13
was
sent.
14
Sec.
14.
NEW
SECTION
.
522E.14
Rules.
15
The
commissioner
shall
adopt
rules
pursuant
to
chapter
17A
16
to
implement
and
administer
this
chapter.
17
Sec.
15.
NEW
SECTION
.
522E.15
Other
law.
18
Nothing
in
this
chapter
regulating
the
sale
of
portable
19
electronics
insurance
shall
be
construed
to
impair
or
impede
20
the
application
of
any
other
law
regulating
the
sale
of
21
portable
electronics
insurance.
22
Sec.
16.
EFFECTIVE
DATE.
This
Act
takes
effect
January
1,
23
2016.
24
EXPLANATION
25
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
26
the
explanation’s
substance
by
the
members
of
the
general
assembly.
27
This
bill
creates
new
Code
chapter
522E
for
the
purpose
28
of
regulating
the
sale
of
portable
electronics
insurance,
29
including
requiring
licensure
of
portable
electronics
vendors
30
to
offer
or
sell
portable
electronics
insurance,
and
providing
31
for
fees
and
penalties.
32
New
Code
chapter
522E
defines
“portable
electronics”
as
33
devices
that
are
personal,
self-contained,
easily
carried
by
34
an
individual,
battery
operated,
and
used
for
a
variety
of
35
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specified
purposes,
and
accessories
or
services
related
to
1
the
use
of
such
devices.
“Portable
electronics
insurance”
is
2
a
contract
providing
coverage
for
the
repair
or
replacement
3
of
portable
electronics.
Such
insurance
does
not
include
a
4
service
contract
or
extended
warranty
or
insurance
covering
5
a
seller’s
or
manufacturer’s
obligations
under
a
warranty.
6
A
“portable
electronics
insurance
license”
issued
by
the
7
commissioner
of
insurance
authorizes
a
portable
electronics
8
vendor
to
offer
or
sell
portable
electronics
insurance.
A
9
“portable
electronics
vendor”
is
a
person
in
the
business,
10
directly
or
indirectly,
of
selling,
reselling,
soliciting,
or
11
leasing
portable
electronics,
their
accessories,
and
related
12
services
to
consumers.
13
Persons
are
prohibited
from
offering
or
selling
portable
14
electronics
insurance
unless
they
are
licensed
as
insurance
15
producers
under
Code
chapter
522B,
are
issued
a
portable
16
electronics
insurance
license
pursuant
to
the
provisions
of
the
17
bill,
or
are
endorsees
in
compliance
with
the
provisions
of
the
18
bill.
A
portable
electronics
insurance
license
issued
by
the
19
commissioner
of
insurance
authorizes
a
portable
electronics
20
vendor
and
its
endorsees,
i.e.,
unlicensed
employees
or
21
authorized
representatives
of
the
vendor,
to
offer
or
sell
22
portable
electronics
insurance
to
consumers
in
connection
with,
23
and
incidental
to,
the
sale
of
portable
electronics
or
the
sale
24
and
provision
of
accessories
or
services
related
to
the
use
of
25
portable
electronics.
26
A
portable
electronics
vendor
must
file
an
application
for
a
27
license
to
sell
portable
electronics
insurance
that
includes
a
28
certificate
by
the
insurer
that
the
vendor
is
trustworthy
and
29
competent,
and
is
accompanied
by
a
fee
of
$50
for
each
endorsee
30
at
a
location
of
the
vendor,
or
$500
per
location,
whichever
31
amount
is
less,
with
a
maximum
fee
of
$5,000
for
vendors
with
32
multiple
locations.
The
bill
also
contains
provisions
for
33
renewal
of
the
license.
34
An
endorsee
of
a
licensed
vendor
may
sell
or
offer
portable
35
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electronics
insurance
under
the
authority
of
the
vendor’s
1
license
if
the
endorsee
is
at
least
18
years
old;
the
vendor
2
supplies
a
list
with
its
license
application
of
all
locations
3
at
which
insurance
will
be
offered;
the
vendor
provides
for
4
training
of
its
endorsees
about
portable
electronics
insurance,
5
ethical
sales
practices,
required
disclosures
to
prospective
6
purchasers,
and
retraining
about
new
products
at
least
every
7
three
years;
and
the
vendor
maintains
a
list
of
endorsees
who
8
have
completed
training.
9
If
the
bill’s
provisions
are
violated
by
a
licensed
vendor
or
10
an
endorsee,
the
commissioner
may,
after
notice
and
a
hearing,
11
revoke
or
suspend
the
license,
or
impose
other
penalties
12
including
suspending
authorization
to
sell
the
insurance
at
13
specific
business
locations
where
violations
have
occurred,
and
14
suspend
or
revoke
the
ability
of
individual
endorsees
to
act
15
under
the
vendor’s
license.
16
The
commissioner
may
issue
a
cease
and
desist
order
against
17
a
person
who
sells
insurance
in
connection
with,
or
incidental
18
to,
the
sale
of
portable
electronics,
or
related
accessories
19
or
services
without
obtaining
the
license
required
by
the
bill
20
or
being
licensed
as
an
insurance
producer
under
Code
chapter
21
522B.
22
A
licensed
portable
electronics
vendor
is
prohibited
from
23
selling
portable
electronics
insurance
unless
at
the
time
of
24
sale
or
enrollment
in
the
insurance
or
within
a
reasonable
25
time
after
a
telephone
transaction,
the
vendor
makes
specified
26
disclosures
and
provides
written
information
to
the
prospective
27
customer
that
includes
material
terms
and
conditions
of
28
coverage;
describes
the
claims
process;
discloses
additional
29
information
about
the
policy;
and
provides
information
about
30
the
vendor.
31
Costs
for
the
insurance
must
be
separately
itemized
in
any
32
billing
statement
for
the
insurance,
or,
if
the
insurance
is
33
included
with
the
purchase
or
lease
of
portable
electronics
34
and
accessories
or
related
services,
the
stand-alone
cost
for
35
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similar
insurance
must
be
disclosed
on
the
consumer’s
bill
and
1
in
marketing
materials
available
at
the
point
of
sale.
2
The
sale
of
portable
electronics
insurance
to
a
customer
3
through
a
“free-trial
offer”
is
prohibited.
4
Charges
for
portable
electronics
insurance
may
be
billed
5
and
collected
by
a
licensed
portable
electronics
vendor.
The
6
vendor
is
not
required
to
segregate
those
moneys
if
the
insurer
7
provides
that
such
segregation
is
not
necessary,
but
such
8
moneys
are
considered
moneys
held
in
trust
by
the
vendor
in
a
9
fiduciary
capacity
for
the
benefit
of
the
insurer.
Vendors
may
10
receive
compensation
for
billing
and
collection
services.
11
A
licensed
portable
electronics
vendor
is
prohibited
from
12
offering
to
sell
insurance
except
in
conjunction
with
and
13
incidental
to
the
business
of
selling
portable
electronics
and
14
related
services
and
accessories;
advertising
or
representing
15
itself
or
its
endorsees
as
licensed
insurers
or
property
and
16
casualty
broker-agents;
paying
an
endorsee
compensation
based
17
primarily
on
the
number
of
customers
that
purchase
portable
18
electronics
insurance,
except
that
incidental
compensation
for
19
such
transactions
is
allowed;
or
transacting
the
business
of
20
any
insurance
other
than
portable
electronics
insurance.
21
An
insurer
that
issues
portable
electronics
insurance
must
22
file
a
copy
of
the
policy
forms
used
with
the
commissioner,
who
23
shall
make
the
forms
available
to
the
public.
24
The
bill
specifies
termination
and
notice
provisions
for
25
portable
electronics
insurance.
26
Whenever
notice
or
correspondence
related
to
notice
is
27
required,
the
notice
must
be
in
writing
and
sent
within
the
28
required
notice
period.
Notices
and
correspondence
must
be
29
sent
to
the
licensed
vendor
that
is
the
policyholder
at
the
30
mailing
address
specified
for
that
purpose
and
to
the
last
31
known
mailing
addresses
on
file
for
affected
consumers.
The
32
insurer
or
the
vendor
shall
maintain
proof
that
the
notice
or
33
correspondence
was
sent
for
not
less
than
three
years.
34
The
commissioner
of
insurance
is
required
to
adopt
rules
to
35
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H.F.
_____
implement
and
administer
new
Code
chapter
522E.
1
Nothing
in
new
Code
chapter
522E
regulating
the
sale
of
2
portable
electronics
insurance
shall
be
construed
to
impair
or
3
impede
the
application
of
any
other
law
regulating
the
sale
of
4
such
insurance.
5
New
Code
chapter
522E
takes
effect
January
1,
2016.
6
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