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House File 2540 - IntroducedA Bill ForAn Act 1relating to the sale of travel insurance.
2BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. NEW SECTION. 515K.1 Short title.
2This chapter shall be known and may be cited as the “Travel
3Insurance Model Act”.
4 Sec. 2. NEW SECTION. 515K.2 Definitions.
5As used in this chapter, unless the context otherwise
6requires:
71. “Aggregator site” means an internet site that provides
8access to information regarding insurance products, including
9product and insurer information, that is obtained from more
10than one insurer for use by consumers in comparison shopping.
112. “Blanket travel insurance” means a policy of travel
12insurance issued to any eligible group that provides coverage
13for specific classes of persons as defined in the policy, with
14coverage provided to all members of the eligible group without
15a separate charge to individual members of the eligible group.
163. “Cancellation fee waiver” means a contractual agreement
17between a supplier of travel services and the supplier’s
18customers to waive some or all of the nonrefundable
19cancellation fee provisions of the supplier’s underlying travel
20contract with or without regard to the reason for cancellation
21or to the form of reimbursement. A cancellation fee waiver
22shall not be considered insurance.
234. “Commissioner” means the commissioner of insurance.
245. “Designated responsible producer” means an employee of
25a limited lines travel insurance producer who is a licensed
26individual insurance producer and who is designated by the
27limited lines travel insurance producer as the individual
28responsible for compliance with the travel insurance laws and
29regulations applicable to the limited lines travel insurance
30producer and the limited lines travel insurance producer’s
31registrants.
326. “Eligible group” means two or more persons who
33are engaged in a common enterprise, or have an economic,
34educational, or social affinity or relationship, including but
35not limited to any of the following:
-1- 1a. An entity engaged in the business of providing travel
2or travel services, including but not limited to a tour
3operator, a lodging provider, a vacation property owner, a
4hotel, a resort, a travel club, a travel agency, a property
5manager, a cultural exchange program, and a common carrier or
6the operator, owner, or lessor of a means of transportation
7of passengers including but not limited to an airline, a
8cruise line, a railroad, a steamship company, and a public bus
9carrier, where with regard to any particular travel or type of
10travel or travelers, all members or customers have a common
11exposure to risk attendant to such travel.
12b. A college, school, or other institution of learning,
13including all students, teachers, employees, and volunteers of
14the college, school, or other institution of learning.
15c. An employer, including all employees, volunteers,
16contractors, and members of the employer’s board of directors;
17and all dependents and guests of an employee, a volunteer, a
18contractor, or a member of the employer’s board of directors.
19d. A sports team, sports camp, or a sponsor of a sports team
20or sports camp, including all participants, members, campers,
21employees, officials, supervisors, or volunteers of the sports
22team, sports camp, or the sponsor of a sports team or sports
23camp.
24e. A religious, charitable, recreational, educational,
25or civic organization, including any group of members,
26participants, and volunteers of the religious, charitable,
27recreational, educational, or civic organization.
28f. A financial institution, a financial institution vendor,
29or a parent holding company, trustee, agent of, or agent
30designated by, one or more financial institutions or financial
31institution vendors, including account holders, credit card
32holders, debtors, guarantors, and purchasers.
33g. An incorporated or unincorporated association, including
34a labor union, that has a common interest, a constitution, and
35bylaws; and that is organized and maintained in good faith for
-2-1a purpose other than obtaining insurance for the members or
2participants of the association.
3h. A trust or a trustee of a fund established, created, or
4maintained for the benefit of and covering members, employees,
5or customers, and that is subject to the commissioner
6permitting the use of a trust and the premium tax provisions
7under section 515K.8, of one or more associations meeting the
8requirements under paragraph “g”.
9i. An entertainment production company including all
10participants, volunteers, audience members, contestants, and
11workers.
12j. A volunteer fire department, ambulance or rescue
13organization, first aid organization, civil defense
14organization, and similar volunteer organizations.
15k. A preschool, or a day care facility for children or
16adults.
17l. An organization for senior citizens.
18m. An automobile or truck rental or leasing company that
19covers a group of individuals who may become renters, lessees,
20or passengers as defined by an individual’s travel status on
21the rented or leased automobile or truck. The common carrier,
22the operator, owner, or lessor of a means of transportation,
23or the automobile or truck rental or leasing company is the
24policyholder under a policy to which this chapter applies.
25n. Any other group, as established by the commissioner by
26rule, in which the members are engaged in a common enterprise,
27or have an economic, educational, or social affinity or
28relationship, and for which issuance of a travel insurance
29policy is not contrary to the public interest.
307. “Fulfillment materials” means documentation provided to
31the purchaser of a travel protection plan that confirms the
32purchase and that provides details of the travel protection
33plan coverage and the travel assistance services.
348. “Group travel insurance” means travel insurance that is
35issued to an eligible group.
-3- 19. “Limited lines travel insurance producer” means any of the
2following:
3a. A licensed managing general agent or a licensed
4third-party administrator.
5b. A licensed insurance producer, including a licensed
6limited lines producer.
7c. A travel administrator.
810. “Offer and disseminate” means to provide general
9information regarding travel insurance or a travel protection
10plan, including a description of the coverage and price, and
11to process an application and collect premiums for travel
12insurance or a travel protection plan.
1311. “Primary certificate holder” means an individual who has
14elected and purchased travel insurance under a group policy.
1512. “Primary policyholder” means an individual who has
16elected and purchased individual travel insurance.
1713. “Travel administrator” means a person who directly
18or indirectly underwrites, collects charges, collateral, or
19premiums from, or adjusts or settles claims on, residents
20of this state in connection with travel insurance. “Travel
21administrator” shall not include a person whose only actions
22that would otherwise cause the person to be considered a travel
23administrator are any of the following:
24a. A person that works for a travel administrator to
25the extent that the person’s activities are subject to the
26supervision and control of the travel administrator.
27b. A person that is an insurance producer and who sells
28insurance or is engaged in administrative and claims-related
29activities within the scope of the person’s producers license.
30c. A person that is a travel retailer that offers and
31disseminates travel insurance and that is registered under the
32license of a limited lines travel insurance producer.
33d. An individual who adjusts or settles claims in the
34normal course of the individual’s practice or employment as
35an attorney and who does not collect charges or premiums in
-4-1connection with insurance coverage.
2e. A business entity that is affiliated with a licensed
3insurer while acting as a travel administrator for the direct
4and assumed insurance business of an affiliated insurer.
514. “Travel assistance services” means a non-insurance,
6non-insurance-related service for which a consumer is not
7indemnified based on a fortuitous event and for which provision
8of the service does not result in the transfer or shifting of
9risk that constitutes the business of insurance, including but
10not limited to any of the following services:
11a. Security advisories.
12b. Destination information.
13c. Vaccination and immunization information services.
14d. Travel reservation services.
15e. Entertainment planning.
16f. Activity and event planning.
17g. Translation assistance.
18h. Emergency messaging.
19i. International legal and medical referrals.
20j. Medical case monitoring.
21k. Coordination of transportation arrangements.
22l. Emergency cash transfer assistance.
23m. Medical prescription replacement assistance.
24n. Passport and travel document replacement assistance.
25o. Lost luggage assistance.
26p. Concierge services.
27q. Any other service furnished in connection with planned
28travel.
2915. a. “Travel insurance” means insurance coverage for
30personal risks incident to planned travel including all of the
31following:
32(1) Interruption or cancellation of a trip or event.
33(2) Loss of baggage or personal effects.
34(3) Damage to an accommodation or to a rental vehicle.
35(4) Sickness, accident, disability, or death occurring
-5-1during travel.
2(5) Emergency evacuation.
3(6) Repatriation of remains.
4(7) Any other contractual obligation to indemnify or pay a
5specified amount to a traveler upon a determinable contingency
6related to travel as established by the commissioner by rule.
7b. “Travel insurance” shall not include a major medical plan
8that provides comprehensive medical protection for a traveler
9for a trip that lasts longer than six months, including a
10traveler who works or resides overseas as an expatriate, or
11any other product that requires a specific insurance producer
12license.
1316. “Travel protection plan” means a product that provides
14one or more of any of the following:
15a. Travel insurance.
16b. Travel assistance services.
17c. Cancellation fee waivers.
1817. “Travel retailer” means a business entity that makes,
19arranges, or offers planned travel and that may offer and
20disseminate travel insurance as a service to the business’s
21customers on behalf of and under the direction of a limited
22lines travel insurance producer.
23 Sec. 3. NEW SECTION. 515K.3 Licensing and registration —
24limited lines travel insurance producers and travel retailers.
251. a. The commissioner may issue a limited lines travel
26insurance producer license to a person that has filed an
27application for a limited lines travel insurance producer
28license in the form and manner prescribed by the commissioner
29by rule.
30b. A limited lines travel insurance producer must be
31licensed to sell, solicit, or negotiate travel insurance
32through a licensed insurer. A person shall not act as a
33limited lines travel insurance producer, or as a travel
34retailer, unless the person is licensed as a limited lines
35travel insurance producer or is registered as a travel
-6-1retailer.
22. A travel retailer may offer and disseminate travel
3insurance under a limited lines travel insurance producer’s
4license only if all of the following conditions are satisfied:
5a. The travel retailer or the limited lines travel insurance
6producer provides all of the following to a purchaser of travel
7insurance:
8(1) A description of the material terms, or the actual
9material terms, of the travel insurance coverage.
10(2) A description of the claim filing process.
11(3) A description of the review and cancellation process.
12(4) The identity of, and the contact information for, the
13insurer and the limited lines travel insurance producer.
14b. (1) Beginning on the date of licensure, a limited
15lines travel insurance producer shall establish and maintain a
16register, in the form and manner prescribed by the commissioner
17by rule, of each travel retailer that offers travel insurance
18on behalf of the limited lines travel insurance producer. The
19register shall include all of the following information:
20(a) The name, address, and contact information of each
21travel retailer.
22(b) The name, address, and contact information of an
23officer or other individual who directs or controls each travel
24retailer’s operations.
25(c) Each travel retailer’s federal tax identification
26number.
27(2) A limited lines travel insurance producer shall submit
28the register under subparagraph (1) to the commissioner upon
29the commissioner’s reasonable request, and shall certify that
30the register complies with 18 U.S.C. §1033.
31(3) Provisions under Title XIII, subtitle 1, that are
32applicable to the suspension or revocation of a resident
33insurance producer’s license, or to the imposition of penalties
34on a resident insurance producer, shall be applicable to
35limited lines travel insurance producers and travel retailers.
-7- 1c. The limited lines travel insurance producer has a
2designated responsible producer.
3d. The designated responsible producer, president,
4secretary, treasurer, and any other officer or individual
5who directs or controls the limited lines travel insurance
6producer’s insurance operations has complied with all
7fingerprinting requirements applicable to insurance producers
8in this state.
9e. The limited lines travel insurance producer has paid all
10licensing fees required by state law.
11f. The limited lines travel insurance producer requires
12each employee and each authorized representative of the travel
13retailer who offers and disseminates travel insurance to
14successfully complete a training program that, at a minimum,
15educates each employee and each authorized representative on
16the details of each type of insurance offered by the travel
17retailer, ethical sales practices, and all disclosures that are
18required to be made to prospective purchasers.
193. A travel retailer that offers and disseminates travel
20insurance shall make brochures or other written materials
21that have been approved by the travel insurer available
22to prospective purchasers. The brochures or other written
23materials shall, at a minimum, do all of the following:
24a. Provide the name, address, and telephone number of the
25insurer and the limited lines travel insurance producer.
26b. Advise that the purchase of travel insurance by the
27prospective purchaser is not required in order to purchase any
28other product or service from the travel retailer.
29c. Explain that a travel retailer that is not licensed as
30an insurance producer is only permitted to provide general
31information about travel insurance offered by the travel
32retailer, including a description of the coverage and price;
33however, the travel retailer is not qualified or authorized
34to answer technical questions about the terms and conditions
35of the travel insurance, or to evaluate the adequacy of the
-8-1prospective purchaser’s existing insurance coverage.
24. A travel retailer’s employee or authorized
3representative who is not licensed as an insurance producer
4shall not do any of the following:
5a. Evaluate or interpret the technical terms, benefits,
6or conditions of travel insurance offered to a prospective
7purchaser.
8b. Evaluate or provide advice on a prospective purchaser’s
9existing insurance coverage.
10c. Represent themselves as a licensed insurer, a licensed
11insurance producer, or as an insurance expert.
125. Notwithstanding any other provision of law to the
13contrary, a travel retailer whose insurance-related activities
14and the insurance-related activities of the travel retailer’s
15employees and authorized representatives are limited to
16offering and disseminating travel insurance on behalf of
17and under the direction of a limited lines travel insurance
18producer in compliance with this chapter, shall be authorized
19to receive related compensation if the travel retailer is
20included in the register maintained by the limited lines travel
21insurance producer under subsection 2, paragraph “b”.
226. As an insurer’s designee, a limited lines travel
23insurance producer shall be responsible for the acts of each
24travel retailer that offers and disseminates travel insurance
25under the limited lines travel insurance producer’s license and
26shall use reasonable means to ensure that each travel retailer
27complies with this chapter.
287. A person that is licensed as an insurance producer in a
29major line of authority shall be authorized to sell, solicit,
30and negotiate travel insurance. A property and casualty
31insurance producer shall not be required to become appointed
32by an insurer in order to sell, solicit, or negotiate travel
33insurance.
34 Sec. 4. NEW SECTION. 515K.4 Travel protection plans.
35A travel protection plan may be offered in this state at one
-9-1price for all features included in the travel protection plan
2if all of the following are true:
31. The travel protection plan clearly discloses to the
4purchaser, at or prior to the time of purchase, that the travel
5protection plan includes, as applicable, travel insurance,
6travel assistance services, and cancellation fee waivers.
72. A purchaser is provided with an opportunity at or prior
8to the time of purchase to obtain additional details regarding
9each feature and the cost of each feature.
103. The fulfillment materials provided to the purchaser do
11all of the following:
12a. Describe and delineate the travel insurance, travel
13assistance services, and cancellation fee waivers included in
14the travel protection plan.
15b. Include, as applicable, travel insurance disclosures
16and the contact information for all persons providing travel
17assistance services and cancellation fee waivers.
18c. Describe, as applicable, all preexisting condition
19exclusions included in the travel insurance policy.
20 Sec. 5. NEW SECTION. 515K.5 Sales and marketing practices.
211. All persons offering travel insurance to residents of
22this state shall be subject to sections 507B.3 and 507B.4,
23except as otherwise provided in this section. In the event of
24a conflict between this chapter and another provision under
25Title XIII, subtitle 1, regarding the sale and marketing of
26travel insurance and travel protection plans, this chapter
27shall control.
282. a. Any document provided to a prospective purchaser
29prior to the prospective purchaser’s purchase of travel
30insurance, including but not limited to sales, advertising,
31and marketing materials, shall be consistent with the
32travel insurance policy, including but not limited to forms,
33endorsements, policies, rate filings, and certificates of
34insurance.
35b. If a travel insurance policy or a travel insurance
-10-1certificate contains any preexisting condition exclusion, a
2prospective purchaser shall, any time prior to the time of
3purchase, be provided an opportunity to learn more about the
4preexisting condition exclusion. Any preexisting condition
5exclusion shall also be included in the travel insurance policy
6or travel insurance certificate fulfillment materials.
7c. The fulfillment materials and the information described
8in section 515K.4 shall be provided to a primary policyholder
9or to a primary certificate holder as soon as practicable
10following the policyholder’s or the certificate holder’s
11purchase of a travel protection plan. From the date of
12purchase of a travel protection plan, a primary policyholder
13or a primary certificate holder may cancel the policy or the
14certificate for a full refund of the purchase price of the
15travel protection plan until the first occurrence of any of the
16following:
17(1) An insured has begun travel that is covered under the
18travel protection plan.
19(2) An insured has filed a claim under the travel protection
20plan.
21(3) It has been at least fifteen days since the date of
22delivery via the United States postal service of the travel
23protection plan’s fulfillment materials to the policyholder or
24the certificate holder.
25(4) It has been ten or more calendar days following the date
26of delivery by electronic means, in compliance with chapter
27505B, of the travel protection plan’s fulfillment materials to
28the policyholder or the certificate holder.
29d. An insurer shall disclose in the policy documentation
30and fulfillment materials provided to the purchaser of travel
31insurance whether the travel insurance is primary or secondary
32to any other applicable insurance coverage.
33e. If travel insurance is marketed directly to consumers
34through an insurer’s internet site, or by another person via
35an aggregator site, it shall not be an unfair trade practice
-11-1or other violation of law for the insurer or the other person
2to provide an accurate summary or short description of the
3available insurance coverage, if all provisions of each
4available travel insurance policy are easily accessible to
5consumers via electronic means.
63. No person shall offer, solicit, or negotiate travel
7insurance or a travel protection plan on an individual or group
8basis through use of a negative option or an opt out that
9requires a consumer to take an affirmative action to deselect
10coverage, including but not limited to unchecking a box on an
11electronic form, if the consumer purchases travel insurance or
12a travel protection plan.
134. It shall be an unfair trade practice pursuant to section
14507B.3 and section 507B.4 to do any of the following:
15a. Offer or sell a travel insurance policy that, due to an
16exclusion or other provisions in the policy, cannot result in
17payment of any claim made by any insured under the policy.
18b. Market blanket travel insurance coverage as no cost
19coverage.
205. If a consumer’s travel destination is located in a
21jurisdiction that mandates specific insurance coverage, it
22shall not be an unfair trade practice to require that the
23consumer, as a condition of purchasing a travel package, select
24one of the following options:
25a. Purchase of the coverage required by the destination
26jurisdiction through either the travel retailer or the limited
27lines travel insurance producer that provides the travel
28package.
29b. Agree to obtain and provide proof of coverage that
30meets the destination jurisdiction’s requirements prior to the
31consumer’s departure.
32 Sec. 6. NEW SECTION. 515K.6 Travel administrators.
331. Notwithstanding any provision of Title XIII, subtitle
341, to the contrary, a person shall not act as, or represent
35itself as, a travel administrator for travel insurance in this
-12-1state unless the person meets at least one of the following
2requirements:
3a. The person is a licensed property and casualty insurance
4producer in this state.
5b. The person is in compliance with all laws and regulations
6that are applicable to managing general agents in this state.
7c. The person is in compliance with all laws and regulations
8that are applicable to third-party administrators in this
9state.
102. An insurer shall be responsible for the acts of a travel
11administrator administering travel insurance underwritten by
12the insurer, and for ensuring that the travel administrator
13maintains all records related to the insurer and makes the
14records available to the commissioner upon request of the
15commissioner.
16 Sec. 7. NEW SECTION. 515K.7 Rates, forms, eligibility, and
17underwriting.
181. Notwithstanding any provision of Title XIII, subtitle 1,
19to the contrary, travel insurance shall be classified and filed
20for purposes of rates and forms under an inland marine line of
21insurance provided that travel insurance that provides coverage
22for sickness, accident, disability or death occurring during
23travel, either exclusively, or in conjunction with related
24coverages of emergency evacuation or repatriation of remains,
25or incidental limited property and casualty benefits such as
26baggage or trip cancellation, may be filed under either an
27accident and health line of insurance or an inland marine line
28of insurance.
292. Travel insurance may be issued in the form of an
30individual insurance policy, a group travel insurance policy,
31or a blanket travel insurance policy.
323. Eligibility and underwriting standards for travel
33insurance may be developed and provided based on travel
34protection plans designed for individual or identified
35marketing or distribution channels, provided that the standards
-13-1also meet the state’s underwriting standards for the line of
2insurance.
3 Sec. 8. NEW SECTION. 515K.8 Tax on gross premiums.
41. An insurer that offers travel insurance shall pay tax
5on gross premiums, as provided in section 432.1, on travel
6insurance premiums paid by any of the following:
7a. A primary policyholder who is a resident of this state.
8b. A primary certificate holder who is a resident of this
9state.
10c. A blanket travel insurance policyholder that is a
11resident of this state, or that has the policyholder’s
12principal place of business or the principal place of business
13of an affiliate or subsidiary that has purchased blanket
14travel insurance in this state for eligible blanket group
15members, subject to any apportionment rules that apply to the
16insurer across multiple taxing jurisdictions, or that permit
17the insurer to allocate premiums on an apportioned basis in a
18reasonable and equitable manner in those taxing jurisdictions.
192. An insurer that offers travel insurance shall do all of
20the following:
21a. Document the state of residence or the state of the
22principal place of business of the primary policyholder or
23primary certificate holder.
24b. Report as premiums only the amount allocable to travel
25insurance, and not report any amounts received from travel
26assistance services or cancellation fee waivers.
27 Sec. 9. NEW SECTION. 515K.9 Applicability.
281. This chapter shall apply to travel insurance that covers
29any resident of this state, and travel insurance that is sold,
30solicited, negotiated, or offered in this state, and to any
31travel insurance policy or certificate that is delivered or
32issued for delivery in this state. This chapter shall not
33apply to cancellation fee waivers or to travel assistance
34services except as expressly provided in this chapter.
352. All applicable provisions of Title XIII, subtitle 1,
-14-1shall apply to travel insurance except that specific provisions
2of this chapter shall supersede any general provisions of Title
3XIII, subtitle 1, that are otherwise applicable to travel
4insurance.
5 Sec. 10. NEW SECTION. 515K.10 Rules.
6The commissioner may adopt rules pursuant to chapter 17A as
7necessary to implement and administer this chapter.
8EXPLANATION
9The inclusion of this explanation does not constitute agreement with
10the explanation’s substance by the members of the general assembly.
11This bill is related to the sale of travel insurance and
12travel protection plans.
13The bill permits the commissioner of insurance
14(commissioner) to issue a limited lines travel insurance
15producer (travel insurance producer) license to a person that
16files an application in the form and manner prescribed by the
17commissioner. A travel insurance producer must be licensed
18to sell, solicit, or negotiate travel insurance through a
19licensed insurer. “Travel insurance” is defined in the bill.
20A person shall not act as a travel insurance producer, or as a
21travel retailer (retailer), unless the person is licensed as
22a travel insurance producer or is registered as a retailer.
23“Travel retailer” is defined in the bill. A retailer may offer
24and disseminate travel insurance under a travel insurance
25producer’s license only if all of the conditions as detailed
26in the bill are satisfied. “Offer and disseminate” is defined
27in the bill.
28The bill requires that a retailer that offers and
29disseminates travel insurance make brochures or other written
30materials that have been approved by the travel insurer, and
31that meet the requirements as detailed in the bill, available
32to prospective purchasers. The bill provides that a retailer’s
33employee or authorized representative who is not licensed as
34an insurance producer shall not evaluate or interpret the
35technical terms, benefits, or conditions of travel insurance
-15-1offered to a prospective purchaser; evaluate or provide advice
2on a prospective purchaser’s existing insurance coverage; or
3hold oneself out as a licensed insurer, a licensed insurance
4producer, or an insurance expert. The bill provides that as
5an insurer’s designee, a travel insurance producer shall be
6responsible for the acts of each retailer that offers and
7disseminates travel insurance under the travel insurance
8producer’s license, and shall use reasonable means to ensure
9that each retailer complies with the applicable requirements
10in the bill.
11Under the bill, a person that is licensed in a major line
12of authority as an insurance producer shall be authorized to
13sell, solicit, and negotiate travel insurance. A property and
14casualty insurance producer shall not be required to become
15appointed by an insurer in order to sell, solicit, or negotiate
16travel insurance.
17Travel protection plans (plan) may be offered in the state
18at one price for all features included in the plan if the
19requirements detailed in the bill are satisfied. All persons
20offering travel insurance to residents of this state shall
21be subject to Code sections 507B.3 and 507B.4, except as
22otherwise provided in the bill. The bill requires that any
23document provided to a prospective purchaser prior to the
24purchaser’s purchase of travel insurance, including but not
25limited to sales, advertising, and marketing materials, is
26consistent with the travel insurance policy, including but not
27limited to forms, endorsements, policies, rate filings, and
28certificates of insurance. If a travel insurance policy or a
29travel insurance certificate contains any preexisting condition
30exclusion, a prospective purchaser shall, at any time prior to
31the time of purchase, be provided an opportunity to learn more
32about the exclusion. Any preexisting condition exclusion shall
33also be included in the travel insurance policy or the travel
34insurance certificate fulfillment materials. “Fulfillment
35materials” is defined in the bill.
-16- 1The bill allows a primary policyholder or a primary
2certificate holder, from the date of purchase of a plan, to
3cancel the policy or certificate, as described in the bill,
4for a full refund of the purchase price of the plan. “Primary
5policyholder” and “primary certificate holder” are defined in
6the bill. An insurer is required to disclose in the policy
7documentation and fulfillment materials provided to the
8purchaser of travel insurance whether the travel insurance
9is primary or secondary to any other applicable insurance
10coverage.
11If travel insurance is marketed directly to consumers
12through an insurer’s internet site, or by another person via
13an aggregator site, it shall not be an unfair trade practice
14or other violation of law for the insurer or the other person
15to provide an accurate summary or short description of the
16available insurance coverage, if all provisions of each
17available travel insurance policy are easily accessible to
18consumers via electronic means. “Aggregator site” is defined
19in the bill. The bill prohibits a person from offering,
20soliciting, or negotiating travel insurance or a plan on an
21individual or group basis through use of a negative option or
22opt out that requires a consumer to take affirmative action to
23deselect coverage if the consumer purchases travel insurance or
24a plan. The bill provides that it is an unfair trade practice
25under Code sections 507B.3 and 507B.4 to offer or sell a travel
26insurance policy that, due to exclusions of other provisions in
27the policy, cannot result in payment of any claim made by any
28insured under the policy; or to market blanket travel insurance
29coverage as no cost coverage. “Blanket travel insurance” is
30defined in the bill as a policy of travel insurance issued to
31any eligible group that provides coverage for specific classes
32of persons as defined in the policy, with coverage provided to
33all members of the eligible group without a separate charge to
34individual members of the eligible group. “Eligible group” is
35also defined in the bill.
-17- 1If a consumer’s travel destination is located in a
2jurisdiction that mandates specific insurance coverage, the
3bill provides that it is not an unfair trade practice to
4require that the consumer, as a condition of purchasing a
5travel package, either purchase the coverage required by
6the jurisdiction through either the retailer or the travel
7insurance producer that provides the travel package, or
8agree to obtain and provide proof of coverage that meets the
9jurisdiction’s requirements prior to the consumer’s departure.
10Notwithstanding any other provisions of Code Title XIII,
11subtitle 1, a person shall not act as or represent itself as,
12a travel administrator for travel insurance in this state
13unless the person is a licensed property and casualty insurance
14producer in this state, or is in compliance with all laws and
15regulations that are applicable to managing general agents
16or to third-party administrators in this state. “Travel
17administrator” is defined in the bill. The bill provides
18that an insurer is responsible for the acts of a travel
19administrator administering travel insurance underwritten by
20the insurer, and for ensuring that the travel administrator
21maintains all records related to the insurer.
22Notwithstanding any provision of Code Title XIII, subtitle
231, to the contrary, travel insurance shall be classified
24and filed for purposes of rates and forms as detailed in
25the bill. Travel insurance may be issued in the form of an
26individual, group, or blanket policy. “Group travel insurance”
27is defined in the bill. Eligibility and underwriting standards
28for travel insurance may be developed and provided based on
29travel protection plans designed for individual or identified
30marketing or distribution channels, provided the standards also
31meet the state’s underwriting standards for the inland marine
32line of insurance. An insurer that offers travel insurance
33shall pay tax on travel insurance premiums as detailed in the
34bill.
35The bill applies to travel insurance that covers any
-18-1resident of this state and to travel insurance that is sold,
2solicited, negotiated, or offered in this state, and to any
3travel insurance policy or certificate that is delivered or
4issued for delivery in this state. The bill does not apply
5to cancellation fee waivers or to travel assistance services
6except as expressly provided in the bill. “Cancellation fee
7waivers” and “travel assistance services” are defined in the
8bill. All applicable provisions of Code Title XIII, subtitle
91, shall apply to travel insurance except that specific
10provisions of the bill shall supersede any general provisions
11of Code Title XIII, subtitle 1, that are otherwise applicable
12to travel insurance.
13The commissioner may adopt rules as necessary to implement
14and administer the bill.
-19-ko/rn
2BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. NEW SECTION. 515K.1 Short title.
2This chapter shall be known and may be cited as the “Travel
3Insurance Model Act”.
4 Sec. 2. NEW SECTION. 515K.2 Definitions.
5As used in this chapter, unless the context otherwise
6requires:
71. “Aggregator site” means an internet site that provides
8access to information regarding insurance products, including
9product and insurer information, that is obtained from more
10than one insurer for use by consumers in comparison shopping.
112. “Blanket travel insurance” means a policy of travel
12insurance issued to any eligible group that provides coverage
13for specific classes of persons as defined in the policy, with
14coverage provided to all members of the eligible group without
15a separate charge to individual members of the eligible group.
163. “Cancellation fee waiver” means a contractual agreement
17between a supplier of travel services and the supplier’s
18customers to waive some or all of the nonrefundable
19cancellation fee provisions of the supplier’s underlying travel
20contract with or without regard to the reason for cancellation
21or to the form of reimbursement. A cancellation fee waiver
22shall not be considered insurance.
234. “Commissioner” means the commissioner of insurance.
245. “Designated responsible producer” means an employee of
25a limited lines travel insurance producer who is a licensed
26individual insurance producer and who is designated by the
27limited lines travel insurance producer as the individual
28responsible for compliance with the travel insurance laws and
29regulations applicable to the limited lines travel insurance
30producer and the limited lines travel insurance producer’s
31registrants.
326. “Eligible group” means two or more persons who
33are engaged in a common enterprise, or have an economic,
34educational, or social affinity or relationship, including but
35not limited to any of the following:
-1- 1a. An entity engaged in the business of providing travel
2or travel services, including but not limited to a tour
3operator, a lodging provider, a vacation property owner, a
4hotel, a resort, a travel club, a travel agency, a property
5manager, a cultural exchange program, and a common carrier or
6the operator, owner, or lessor of a means of transportation
7of passengers including but not limited to an airline, a
8cruise line, a railroad, a steamship company, and a public bus
9carrier, where with regard to any particular travel or type of
10travel or travelers, all members or customers have a common
11exposure to risk attendant to such travel.
12b. A college, school, or other institution of learning,
13including all students, teachers, employees, and volunteers of
14the college, school, or other institution of learning.
15c. An employer, including all employees, volunteers,
16contractors, and members of the employer’s board of directors;
17and all dependents and guests of an employee, a volunteer, a
18contractor, or a member of the employer’s board of directors.
19d. A sports team, sports camp, or a sponsor of a sports team
20or sports camp, including all participants, members, campers,
21employees, officials, supervisors, or volunteers of the sports
22team, sports camp, or the sponsor of a sports team or sports
23camp.
24e. A religious, charitable, recreational, educational,
25or civic organization, including any group of members,
26participants, and volunteers of the religious, charitable,
27recreational, educational, or civic organization.
28f. A financial institution, a financial institution vendor,
29or a parent holding company, trustee, agent of, or agent
30designated by, one or more financial institutions or financial
31institution vendors, including account holders, credit card
32holders, debtors, guarantors, and purchasers.
33g. An incorporated or unincorporated association, including
34a labor union, that has a common interest, a constitution, and
35bylaws; and that is organized and maintained in good faith for
-2-1a purpose other than obtaining insurance for the members or
2participants of the association.
3h. A trust or a trustee of a fund established, created, or
4maintained for the benefit of and covering members, employees,
5or customers, and that is subject to the commissioner
6permitting the use of a trust and the premium tax provisions
7under section 515K.8, of one or more associations meeting the
8requirements under paragraph “g”.
9i. An entertainment production company including all
10participants, volunteers, audience members, contestants, and
11workers.
12j. A volunteer fire department, ambulance or rescue
13organization, first aid organization, civil defense
14organization, and similar volunteer organizations.
15k. A preschool, or a day care facility for children or
16adults.
17l. An organization for senior citizens.
18m. An automobile or truck rental or leasing company that
19covers a group of individuals who may become renters, lessees,
20or passengers as defined by an individual’s travel status on
21the rented or leased automobile or truck. The common carrier,
22the operator, owner, or lessor of a means of transportation,
23or the automobile or truck rental or leasing company is the
24policyholder under a policy to which this chapter applies.
25n. Any other group, as established by the commissioner by
26rule, in which the members are engaged in a common enterprise,
27or have an economic, educational, or social affinity or
28relationship, and for which issuance of a travel insurance
29policy is not contrary to the public interest.
307. “Fulfillment materials” means documentation provided to
31the purchaser of a travel protection plan that confirms the
32purchase and that provides details of the travel protection
33plan coverage and the travel assistance services.
348. “Group travel insurance” means travel insurance that is
35issued to an eligible group.
-3- 19. “Limited lines travel insurance producer” means any of the
2following:
3a. A licensed managing general agent or a licensed
4third-party administrator.
5b. A licensed insurance producer, including a licensed
6limited lines producer.
7c. A travel administrator.
810. “Offer and disseminate” means to provide general
9information regarding travel insurance or a travel protection
10plan, including a description of the coverage and price, and
11to process an application and collect premiums for travel
12insurance or a travel protection plan.
1311. “Primary certificate holder” means an individual who has
14elected and purchased travel insurance under a group policy.
1512. “Primary policyholder” means an individual who has
16elected and purchased individual travel insurance.
1713. “Travel administrator” means a person who directly
18or indirectly underwrites, collects charges, collateral, or
19premiums from, or adjusts or settles claims on, residents
20of this state in connection with travel insurance. “Travel
21administrator” shall not include a person whose only actions
22that would otherwise cause the person to be considered a travel
23administrator are any of the following:
24a. A person that works for a travel administrator to
25the extent that the person’s activities are subject to the
26supervision and control of the travel administrator.
27b. A person that is an insurance producer and who sells
28insurance or is engaged in administrative and claims-related
29activities within the scope of the person’s producers license.
30c. A person that is a travel retailer that offers and
31disseminates travel insurance and that is registered under the
32license of a limited lines travel insurance producer.
33d. An individual who adjusts or settles claims in the
34normal course of the individual’s practice or employment as
35an attorney and who does not collect charges or premiums in
-4-1connection with insurance coverage.
2e. A business entity that is affiliated with a licensed
3insurer while acting as a travel administrator for the direct
4and assumed insurance business of an affiliated insurer.
514. “Travel assistance services” means a non-insurance,
6non-insurance-related service for which a consumer is not
7indemnified based on a fortuitous event and for which provision
8of the service does not result in the transfer or shifting of
9risk that constitutes the business of insurance, including but
10not limited to any of the following services:
11a. Security advisories.
12b. Destination information.
13c. Vaccination and immunization information services.
14d. Travel reservation services.
15e. Entertainment planning.
16f. Activity and event planning.
17g. Translation assistance.
18h. Emergency messaging.
19i. International legal and medical referrals.
20j. Medical case monitoring.
21k. Coordination of transportation arrangements.
22l. Emergency cash transfer assistance.
23m. Medical prescription replacement assistance.
24n. Passport and travel document replacement assistance.
25o. Lost luggage assistance.
26p. Concierge services.
27q. Any other service furnished in connection with planned
28travel.
2915. a. “Travel insurance” means insurance coverage for
30personal risks incident to planned travel including all of the
31following:
32(1) Interruption or cancellation of a trip or event.
33(2) Loss of baggage or personal effects.
34(3) Damage to an accommodation or to a rental vehicle.
35(4) Sickness, accident, disability, or death occurring
-5-1during travel.
2(5) Emergency evacuation.
3(6) Repatriation of remains.
4(7) Any other contractual obligation to indemnify or pay a
5specified amount to a traveler upon a determinable contingency
6related to travel as established by the commissioner by rule.
7b. “Travel insurance” shall not include a major medical plan
8that provides comprehensive medical protection for a traveler
9for a trip that lasts longer than six months, including a
10traveler who works or resides overseas as an expatriate, or
11any other product that requires a specific insurance producer
12license.
1316. “Travel protection plan” means a product that provides
14one or more of any of the following:
15a. Travel insurance.
16b. Travel assistance services.
17c. Cancellation fee waivers.
1817. “Travel retailer” means a business entity that makes,
19arranges, or offers planned travel and that may offer and
20disseminate travel insurance as a service to the business’s
21customers on behalf of and under the direction of a limited
22lines travel insurance producer.
23 Sec. 3. NEW SECTION. 515K.3 Licensing and registration —
24limited lines travel insurance producers and travel retailers.
251. a. The commissioner may issue a limited lines travel
26insurance producer license to a person that has filed an
27application for a limited lines travel insurance producer
28license in the form and manner prescribed by the commissioner
29by rule.
30b. A limited lines travel insurance producer must be
31licensed to sell, solicit, or negotiate travel insurance
32through a licensed insurer. A person shall not act as a
33limited lines travel insurance producer, or as a travel
34retailer, unless the person is licensed as a limited lines
35travel insurance producer or is registered as a travel
-6-1retailer.
22. A travel retailer may offer and disseminate travel
3insurance under a limited lines travel insurance producer’s
4license only if all of the following conditions are satisfied:
5a. The travel retailer or the limited lines travel insurance
6producer provides all of the following to a purchaser of travel
7insurance:
8(1) A description of the material terms, or the actual
9material terms, of the travel insurance coverage.
10(2) A description of the claim filing process.
11(3) A description of the review and cancellation process.
12(4) The identity of, and the contact information for, the
13insurer and the limited lines travel insurance producer.
14b. (1) Beginning on the date of licensure, a limited
15lines travel insurance producer shall establish and maintain a
16register, in the form and manner prescribed by the commissioner
17by rule, of each travel retailer that offers travel insurance
18on behalf of the limited lines travel insurance producer. The
19register shall include all of the following information:
20(a) The name, address, and contact information of each
21travel retailer.
22(b) The name, address, and contact information of an
23officer or other individual who directs or controls each travel
24retailer’s operations.
25(c) Each travel retailer’s federal tax identification
26number.
27(2) A limited lines travel insurance producer shall submit
28the register under subparagraph (1) to the commissioner upon
29the commissioner’s reasonable request, and shall certify that
30the register complies with 18 U.S.C. §1033.
31(3) Provisions under Title XIII, subtitle 1, that are
32applicable to the suspension or revocation of a resident
33insurance producer’s license, or to the imposition of penalties
34on a resident insurance producer, shall be applicable to
35limited lines travel insurance producers and travel retailers.
-7- 1c. The limited lines travel insurance producer has a
2designated responsible producer.
3d. The designated responsible producer, president,
4secretary, treasurer, and any other officer or individual
5who directs or controls the limited lines travel insurance
6producer’s insurance operations has complied with all
7fingerprinting requirements applicable to insurance producers
8in this state.
9e. The limited lines travel insurance producer has paid all
10licensing fees required by state law.
11f. The limited lines travel insurance producer requires
12each employee and each authorized representative of the travel
13retailer who offers and disseminates travel insurance to
14successfully complete a training program that, at a minimum,
15educates each employee and each authorized representative on
16the details of each type of insurance offered by the travel
17retailer, ethical sales practices, and all disclosures that are
18required to be made to prospective purchasers.
193. A travel retailer that offers and disseminates travel
20insurance shall make brochures or other written materials
21that have been approved by the travel insurer available
22to prospective purchasers. The brochures or other written
23materials shall, at a minimum, do all of the following:
24a. Provide the name, address, and telephone number of the
25insurer and the limited lines travel insurance producer.
26b. Advise that the purchase of travel insurance by the
27prospective purchaser is not required in order to purchase any
28other product or service from the travel retailer.
29c. Explain that a travel retailer that is not licensed as
30an insurance producer is only permitted to provide general
31information about travel insurance offered by the travel
32retailer, including a description of the coverage and price;
33however, the travel retailer is not qualified or authorized
34to answer technical questions about the terms and conditions
35of the travel insurance, or to evaluate the adequacy of the
-8-1prospective purchaser’s existing insurance coverage.
24. A travel retailer’s employee or authorized
3representative who is not licensed as an insurance producer
4shall not do any of the following:
5a. Evaluate or interpret the technical terms, benefits,
6or conditions of travel insurance offered to a prospective
7purchaser.
8b. Evaluate or provide advice on a prospective purchaser’s
9existing insurance coverage.
10c. Represent themselves as a licensed insurer, a licensed
11insurance producer, or as an insurance expert.
125. Notwithstanding any other provision of law to the
13contrary, a travel retailer whose insurance-related activities
14and the insurance-related activities of the travel retailer’s
15employees and authorized representatives are limited to
16offering and disseminating travel insurance on behalf of
17and under the direction of a limited lines travel insurance
18producer in compliance with this chapter, shall be authorized
19to receive related compensation if the travel retailer is
20included in the register maintained by the limited lines travel
21insurance producer under subsection 2, paragraph “b”.
226. As an insurer’s designee, a limited lines travel
23insurance producer shall be responsible for the acts of each
24travel retailer that offers and disseminates travel insurance
25under the limited lines travel insurance producer’s license and
26shall use reasonable means to ensure that each travel retailer
27complies with this chapter.
287. A person that is licensed as an insurance producer in a
29major line of authority shall be authorized to sell, solicit,
30and negotiate travel insurance. A property and casualty
31insurance producer shall not be required to become appointed
32by an insurer in order to sell, solicit, or negotiate travel
33insurance.
34 Sec. 4. NEW SECTION. 515K.4 Travel protection plans.
35A travel protection plan may be offered in this state at one
-9-1price for all features included in the travel protection plan
2if all of the following are true:
31. The travel protection plan clearly discloses to the
4purchaser, at or prior to the time of purchase, that the travel
5protection plan includes, as applicable, travel insurance,
6travel assistance services, and cancellation fee waivers.
72. A purchaser is provided with an opportunity at or prior
8to the time of purchase to obtain additional details regarding
9each feature and the cost of each feature.
103. The fulfillment materials provided to the purchaser do
11all of the following:
12a. Describe and delineate the travel insurance, travel
13assistance services, and cancellation fee waivers included in
14the travel protection plan.
15b. Include, as applicable, travel insurance disclosures
16and the contact information for all persons providing travel
17assistance services and cancellation fee waivers.
18c. Describe, as applicable, all preexisting condition
19exclusions included in the travel insurance policy.
20 Sec. 5. NEW SECTION. 515K.5 Sales and marketing practices.
211. All persons offering travel insurance to residents of
22this state shall be subject to sections 507B.3 and 507B.4,
23except as otherwise provided in this section. In the event of
24a conflict between this chapter and another provision under
25Title XIII, subtitle 1, regarding the sale and marketing of
26travel insurance and travel protection plans, this chapter
27shall control.
282. a. Any document provided to a prospective purchaser
29prior to the prospective purchaser’s purchase of travel
30insurance, including but not limited to sales, advertising,
31and marketing materials, shall be consistent with the
32travel insurance policy, including but not limited to forms,
33endorsements, policies, rate filings, and certificates of
34insurance.
35b. If a travel insurance policy or a travel insurance
-10-1certificate contains any preexisting condition exclusion, a
2prospective purchaser shall, any time prior to the time of
3purchase, be provided an opportunity to learn more about the
4preexisting condition exclusion. Any preexisting condition
5exclusion shall also be included in the travel insurance policy
6or travel insurance certificate fulfillment materials.
7c. The fulfillment materials and the information described
8in section 515K.4 shall be provided to a primary policyholder
9or to a primary certificate holder as soon as practicable
10following the policyholder’s or the certificate holder’s
11purchase of a travel protection plan. From the date of
12purchase of a travel protection plan, a primary policyholder
13or a primary certificate holder may cancel the policy or the
14certificate for a full refund of the purchase price of the
15travel protection plan until the first occurrence of any of the
16following:
17(1) An insured has begun travel that is covered under the
18travel protection plan.
19(2) An insured has filed a claim under the travel protection
20plan.
21(3) It has been at least fifteen days since the date of
22delivery via the United States postal service of the travel
23protection plan’s fulfillment materials to the policyholder or
24the certificate holder.
25(4) It has been ten or more calendar days following the date
26of delivery by electronic means, in compliance with chapter
27505B, of the travel protection plan’s fulfillment materials to
28the policyholder or the certificate holder.
29d. An insurer shall disclose in the policy documentation
30and fulfillment materials provided to the purchaser of travel
31insurance whether the travel insurance is primary or secondary
32to any other applicable insurance coverage.
33e. If travel insurance is marketed directly to consumers
34through an insurer’s internet site, or by another person via
35an aggregator site, it shall not be an unfair trade practice
-11-1or other violation of law for the insurer or the other person
2to provide an accurate summary or short description of the
3available insurance coverage, if all provisions of each
4available travel insurance policy are easily accessible to
5consumers via electronic means.
63. No person shall offer, solicit, or negotiate travel
7insurance or a travel protection plan on an individual or group
8basis through use of a negative option or an opt out that
9requires a consumer to take an affirmative action to deselect
10coverage, including but not limited to unchecking a box on an
11electronic form, if the consumer purchases travel insurance or
12a travel protection plan.
134. It shall be an unfair trade practice pursuant to section
14507B.3 and section 507B.4 to do any of the following:
15a. Offer or sell a travel insurance policy that, due to an
16exclusion or other provisions in the policy, cannot result in
17payment of any claim made by any insured under the policy.
18b. Market blanket travel insurance coverage as no cost
19coverage.
205. If a consumer’s travel destination is located in a
21jurisdiction that mandates specific insurance coverage, it
22shall not be an unfair trade practice to require that the
23consumer, as a condition of purchasing a travel package, select
24one of the following options:
25a. Purchase of the coverage required by the destination
26jurisdiction through either the travel retailer or the limited
27lines travel insurance producer that provides the travel
28package.
29b. Agree to obtain and provide proof of coverage that
30meets the destination jurisdiction’s requirements prior to the
31consumer’s departure.
32 Sec. 6. NEW SECTION. 515K.6 Travel administrators.
331. Notwithstanding any provision of Title XIII, subtitle
341, to the contrary, a person shall not act as, or represent
35itself as, a travel administrator for travel insurance in this
-12-1state unless the person meets at least one of the following
2requirements:
3a. The person is a licensed property and casualty insurance
4producer in this state.
5b. The person is in compliance with all laws and regulations
6that are applicable to managing general agents in this state.
7c. The person is in compliance with all laws and regulations
8that are applicable to third-party administrators in this
9state.
102. An insurer shall be responsible for the acts of a travel
11administrator administering travel insurance underwritten by
12the insurer, and for ensuring that the travel administrator
13maintains all records related to the insurer and makes the
14records available to the commissioner upon request of the
15commissioner.
16 Sec. 7. NEW SECTION. 515K.7 Rates, forms, eligibility, and
17underwriting.
181. Notwithstanding any provision of Title XIII, subtitle 1,
19to the contrary, travel insurance shall be classified and filed
20for purposes of rates and forms under an inland marine line of
21insurance provided that travel insurance that provides coverage
22for sickness, accident, disability or death occurring during
23travel, either exclusively, or in conjunction with related
24coverages of emergency evacuation or repatriation of remains,
25or incidental limited property and casualty benefits such as
26baggage or trip cancellation, may be filed under either an
27accident and health line of insurance or an inland marine line
28of insurance.
292. Travel insurance may be issued in the form of an
30individual insurance policy, a group travel insurance policy,
31or a blanket travel insurance policy.
323. Eligibility and underwriting standards for travel
33insurance may be developed and provided based on travel
34protection plans designed for individual or identified
35marketing or distribution channels, provided that the standards
-13-1also meet the state’s underwriting standards for the line of
2insurance.
3 Sec. 8. NEW SECTION. 515K.8 Tax on gross premiums.
41. An insurer that offers travel insurance shall pay tax
5on gross premiums, as provided in section 432.1, on travel
6insurance premiums paid by any of the following:
7a. A primary policyholder who is a resident of this state.
8b. A primary certificate holder who is a resident of this
9state.
10c. A blanket travel insurance policyholder that is a
11resident of this state, or that has the policyholder’s
12principal place of business or the principal place of business
13of an affiliate or subsidiary that has purchased blanket
14travel insurance in this state for eligible blanket group
15members, subject to any apportionment rules that apply to the
16insurer across multiple taxing jurisdictions, or that permit
17the insurer to allocate premiums on an apportioned basis in a
18reasonable and equitable manner in those taxing jurisdictions.
192. An insurer that offers travel insurance shall do all of
20the following:
21a. Document the state of residence or the state of the
22principal place of business of the primary policyholder or
23primary certificate holder.
24b. Report as premiums only the amount allocable to travel
25insurance, and not report any amounts received from travel
26assistance services or cancellation fee waivers.
27 Sec. 9. NEW SECTION. 515K.9 Applicability.
281. This chapter shall apply to travel insurance that covers
29any resident of this state, and travel insurance that is sold,
30solicited, negotiated, or offered in this state, and to any
31travel insurance policy or certificate that is delivered or
32issued for delivery in this state. This chapter shall not
33apply to cancellation fee waivers or to travel assistance
34services except as expressly provided in this chapter.
352. All applicable provisions of Title XIII, subtitle 1,
-14-1shall apply to travel insurance except that specific provisions
2of this chapter shall supersede any general provisions of Title
3XIII, subtitle 1, that are otherwise applicable to travel
4insurance.
5 Sec. 10. NEW SECTION. 515K.10 Rules.
6The commissioner may adopt rules pursuant to chapter 17A as
7necessary to implement and administer this chapter.
8EXPLANATION
9The inclusion of this explanation does not constitute agreement with
10the explanation’s substance by the members of the general assembly.
11This bill is related to the sale of travel insurance and
12travel protection plans.
13The bill permits the commissioner of insurance
14(commissioner) to issue a limited lines travel insurance
15producer (travel insurance producer) license to a person that
16files an application in the form and manner prescribed by the
17commissioner. A travel insurance producer must be licensed
18to sell, solicit, or negotiate travel insurance through a
19licensed insurer. “Travel insurance” is defined in the bill.
20A person shall not act as a travel insurance producer, or as a
21travel retailer (retailer), unless the person is licensed as
22a travel insurance producer or is registered as a retailer.
23“Travel retailer” is defined in the bill. A retailer may offer
24and disseminate travel insurance under a travel insurance
25producer’s license only if all of the conditions as detailed
26in the bill are satisfied. “Offer and disseminate” is defined
27in the bill.
28The bill requires that a retailer that offers and
29disseminates travel insurance make brochures or other written
30materials that have been approved by the travel insurer, and
31that meet the requirements as detailed in the bill, available
32to prospective purchasers. The bill provides that a retailer’s
33employee or authorized representative who is not licensed as
34an insurance producer shall not evaluate or interpret the
35technical terms, benefits, or conditions of travel insurance
-15-1offered to a prospective purchaser; evaluate or provide advice
2on a prospective purchaser’s existing insurance coverage; or
3hold oneself out as a licensed insurer, a licensed insurance
4producer, or an insurance expert. The bill provides that as
5an insurer’s designee, a travel insurance producer shall be
6responsible for the acts of each retailer that offers and
7disseminates travel insurance under the travel insurance
8producer’s license, and shall use reasonable means to ensure
9that each retailer complies with the applicable requirements
10in the bill.
11Under the bill, a person that is licensed in a major line
12of authority as an insurance producer shall be authorized to
13sell, solicit, and negotiate travel insurance. A property and
14casualty insurance producer shall not be required to become
15appointed by an insurer in order to sell, solicit, or negotiate
16travel insurance.
17Travel protection plans (plan) may be offered in the state
18at one price for all features included in the plan if the
19requirements detailed in the bill are satisfied. All persons
20offering travel insurance to residents of this state shall
21be subject to Code sections 507B.3 and 507B.4, except as
22otherwise provided in the bill. The bill requires that any
23document provided to a prospective purchaser prior to the
24purchaser’s purchase of travel insurance, including but not
25limited to sales, advertising, and marketing materials, is
26consistent with the travel insurance policy, including but not
27limited to forms, endorsements, policies, rate filings, and
28certificates of insurance. If a travel insurance policy or a
29travel insurance certificate contains any preexisting condition
30exclusion, a prospective purchaser shall, at any time prior to
31the time of purchase, be provided an opportunity to learn more
32about the exclusion. Any preexisting condition exclusion shall
33also be included in the travel insurance policy or the travel
34insurance certificate fulfillment materials. “Fulfillment
35materials” is defined in the bill.
-16- 1The bill allows a primary policyholder or a primary
2certificate holder, from the date of purchase of a plan, to
3cancel the policy or certificate, as described in the bill,
4for a full refund of the purchase price of the plan. “Primary
5policyholder” and “primary certificate holder” are defined in
6the bill. An insurer is required to disclose in the policy
7documentation and fulfillment materials provided to the
8purchaser of travel insurance whether the travel insurance
9is primary or secondary to any other applicable insurance
10coverage.
11If travel insurance is marketed directly to consumers
12through an insurer’s internet site, or by another person via
13an aggregator site, it shall not be an unfair trade practice
14or other violation of law for the insurer or the other person
15to provide an accurate summary or short description of the
16available insurance coverage, if all provisions of each
17available travel insurance policy are easily accessible to
18consumers via electronic means. “Aggregator site” is defined
19in the bill. The bill prohibits a person from offering,
20soliciting, or negotiating travel insurance or a plan on an
21individual or group basis through use of a negative option or
22opt out that requires a consumer to take affirmative action to
23deselect coverage if the consumer purchases travel insurance or
24a plan. The bill provides that it is an unfair trade practice
25under Code sections 507B.3 and 507B.4 to offer or sell a travel
26insurance policy that, due to exclusions of other provisions in
27the policy, cannot result in payment of any claim made by any
28insured under the policy; or to market blanket travel insurance
29coverage as no cost coverage. “Blanket travel insurance” is
30defined in the bill as a policy of travel insurance issued to
31any eligible group that provides coverage for specific classes
32of persons as defined in the policy, with coverage provided to
33all members of the eligible group without a separate charge to
34individual members of the eligible group. “Eligible group” is
35also defined in the bill.
-17- 1If a consumer’s travel destination is located in a
2jurisdiction that mandates specific insurance coverage, the
3bill provides that it is not an unfair trade practice to
4require that the consumer, as a condition of purchasing a
5travel package, either purchase the coverage required by
6the jurisdiction through either the retailer or the travel
7insurance producer that provides the travel package, or
8agree to obtain and provide proof of coverage that meets the
9jurisdiction’s requirements prior to the consumer’s departure.
10Notwithstanding any other provisions of Code Title XIII,
11subtitle 1, a person shall not act as or represent itself as,
12a travel administrator for travel insurance in this state
13unless the person is a licensed property and casualty insurance
14producer in this state, or is in compliance with all laws and
15regulations that are applicable to managing general agents
16or to third-party administrators in this state. “Travel
17administrator” is defined in the bill. The bill provides
18that an insurer is responsible for the acts of a travel
19administrator administering travel insurance underwritten by
20the insurer, and for ensuring that the travel administrator
21maintains all records related to the insurer.
22Notwithstanding any provision of Code Title XIII, subtitle
231, to the contrary, travel insurance shall be classified
24and filed for purposes of rates and forms as detailed in
25the bill. Travel insurance may be issued in the form of an
26individual, group, or blanket policy. “Group travel insurance”
27is defined in the bill. Eligibility and underwriting standards
28for travel insurance may be developed and provided based on
29travel protection plans designed for individual or identified
30marketing or distribution channels, provided the standards also
31meet the state’s underwriting standards for the inland marine
32line of insurance. An insurer that offers travel insurance
33shall pay tax on travel insurance premiums as detailed in the
34bill.
35The bill applies to travel insurance that covers any
-18-1resident of this state and to travel insurance that is sold,
2solicited, negotiated, or offered in this state, and to any
3travel insurance policy or certificate that is delivered or
4issued for delivery in this state. The bill does not apply
5to cancellation fee waivers or to travel assistance services
6except as expressly provided in the bill. “Cancellation fee
7waivers” and “travel assistance services” are defined in the
8bill. All applicable provisions of Code Title XIII, subtitle
91, shall apply to travel insurance except that specific
10provisions of the bill shall supersede any general provisions
11of Code Title XIII, subtitle 1, that are otherwise applicable
12to travel insurance.
13The commissioner may adopt rules as necessary to implement
14and administer the bill.
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