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House File 309 - EnrolledAn Actrelating to certificates of insurance, including
penalties and effective date and applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
Section 1. NEW SECTION. 515.115 Certificates of insurance
— penalty.
1. As used in this section, unless the context otherwise
requires:
a. “Certificate of insurance” means a document or
instrument, regardless of how the document or instrument is
titled or described, that is prepared or issued by an insurer
or insurance producer as evidence of property and casualty
insurance coverage. “Certificate of insurance” does not include
a policy of insurance, insurance binder, policy endorsement, or
automobile insurance identification or information card.
b. “Commercial real estate transaction” means a non-recourse
commercial lending transaction in which the underlying property
serves as the primary collateral securing the borrower’s
repayment of the loan and the borrower or any of the borrower’s
members, partners, or shareholders, or any person related
to the borrower or the borrower’s members, partners, or
shareholders, does not bear the economic risk of loss in the
event of a payment default under the terms of the commercial
lending transaction.
c. “Insurance producer” means a person required to be
licensed pursuant to chapter 522B to sell, solicit, or
negotiate property and casualty insurance.
d. “Insurer” means a property and casualty insurance company
regulated under this chapter.
e. “Person” means the same as defined in section 4.1.
2. a. The commissioner of insurance shall prohibit the use
of a certificate of insurance form if the form is either of the
following:
(1) Unfair, misleading, or deceptive, or violates public
policy.
(2) Violates any law, including any rule adopted by the
commissioner of insurance pursuant to chapter 17A.
b. A certificate of insurance is not a policy of insurance
and does not affirmatively or negatively amend, extend,
-1-or alter the coverage afforded by the policy to which the
certificate of insurance makes reference. A certificate of
insurance shall not confer on any person new or additional
rights beyond what the referenced policy of insurance expressly
provides.
c. Notwithstanding any provision of this chapter to the
contrary, or any language on a certificate of insurance
that states that the form is for “information only”, a
binder delivered together with a certificate of insurance in
connection with a commercial real estate transaction shall
be valid and may be relied upon by the borrower or by the
borrower’s lender as evidence of insurance, including in a
private civil action or an administrative proceeding, until
the delivery of the insurance policy to the borrower or
the cancellation of the binder pursuant to section 515.125,
515.126, or 515.127.
3. a. A person shall not do any of the following:
(1) Prepare, issue, request, or require the issuance of a
certificate of insurance that contains any false or misleading
information concerning the policy of insurance to which the
certificate of insurance makes reference.
(2) Prepare, issue, request, or require the issuance of
a certificate of insurance that purports to affirmatively or
negatively amend, extend, or alter the coverage provided by the
policy of insurance to which the certificate of insurance makes
reference.
b. A certificate of insurance shall not warrant that the
policy of insurance referenced in the certificate of insurance
complies with the insurance or indemnification requirements
of a contract and the inclusion of a contract number or
description within a certificate of insurance shall not be
interpreted as warranting compliance with such requirements.
4. A person is entitled to notice of cancellation,
nonrenewal, or material change concerning a policy of insurance
or to any similar notice concerning a policy of insurance
-2-only if the person has such rights to notice under the terms
of the policy of insurance or any endorsement to the policy
of insurance. The terms and conditions of a person’s right
to notice are governed by the policy of insurance or the
endorsement and shall not be altered by a certificate of
insurance.
5. a. The provisions of this section are applicable to all
certificates of insurance issued in connection with property,
operations, or risks located in this state, regardless of
where the policyholder, insurer, insurance producer, or person
requesting or requiring the issuance of a certificate of
insurance is located.
b. A certificate of insurance or any other document or
correspondence prepared, issued, requested, or required in
violation of this section is null and void.
6. The commissioner of insurance may do all of the
following:
a. Examine and investigate the activities of any person that
the commissioner reasonably believes has been or is engaged in
an act or practice prohibited under this section.
b. Enforce the provisions of this section, including the
authority to issue orders to cease and desist, and to impose a
penalty in an amount of five hundred dollars per violation to
be collected in the name of the state for deposit as provided
in section 505.7.
c. Adopt rules pursuant to chapter 17A to administer this
section.
Sec. 2. EFFECTIVE UPON ENACTMENT. This Act, being deemed of
immediate importance, takes effect upon enactment.
Sec. 3. APPLICABILITY. This Act applies to certificates of
insurance prepared, issued, requested, or required beginning
ninety days after the effective date of this Act.
______________________________
LINDA UPMEYERSpeaker of the House______________________________
JACK WHITVERPresident of the Senate I hereby certify that this bill originated in the House and is known as House File 309, Eighty-seventh General Assembly.______________________________
CARMINE BOALChief Clerk of the HouseApproved _______________, 2017______________________________
TERRY E. BRANSTADGovernorav/nh
penalties and effective date and applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
Section 1. NEW SECTION. 515.115 Certificates of insurance
— penalty.
1. As used in this section, unless the context otherwise
requires:
a. “Certificate of insurance” means a document or
instrument, regardless of how the document or instrument is
titled or described, that is prepared or issued by an insurer
or insurance producer as evidence of property and casualty
insurance coverage. “Certificate of insurance” does not include
a policy of insurance, insurance binder, policy endorsement, or
automobile insurance identification or information card.
b. “Commercial real estate transaction” means a non-recourse
commercial lending transaction in which the underlying property
serves as the primary collateral securing the borrower’s
repayment of the loan and the borrower or any of the borrower’s
members, partners, or shareholders, or any person related
to the borrower or the borrower’s members, partners, or
shareholders, does not bear the economic risk of loss in the
event of a payment default under the terms of the commercial
lending transaction.
c. “Insurance producer” means a person required to be
licensed pursuant to chapter 522B to sell, solicit, or
negotiate property and casualty insurance.
d. “Insurer” means a property and casualty insurance company
regulated under this chapter.
e. “Person” means the same as defined in section 4.1.
2. a. The commissioner of insurance shall prohibit the use
of a certificate of insurance form if the form is either of the
following:
(1) Unfair, misleading, or deceptive, or violates public
policy.
(2) Violates any law, including any rule adopted by the
commissioner of insurance pursuant to chapter 17A.
b. A certificate of insurance is not a policy of insurance
and does not affirmatively or negatively amend, extend,
-1-or alter the coverage afforded by the policy to which the
certificate of insurance makes reference. A certificate of
insurance shall not confer on any person new or additional
rights beyond what the referenced policy of insurance expressly
provides.
c. Notwithstanding any provision of this chapter to the
contrary, or any language on a certificate of insurance
that states that the form is for “information only”, a
binder delivered together with a certificate of insurance in
connection with a commercial real estate transaction shall
be valid and may be relied upon by the borrower or by the
borrower’s lender as evidence of insurance, including in a
private civil action or an administrative proceeding, until
the delivery of the insurance policy to the borrower or
the cancellation of the binder pursuant to section 515.125,
515.126, or 515.127.
3. a. A person shall not do any of the following:
(1) Prepare, issue, request, or require the issuance of a
certificate of insurance that contains any false or misleading
information concerning the policy of insurance to which the
certificate of insurance makes reference.
(2) Prepare, issue, request, or require the issuance of
a certificate of insurance that purports to affirmatively or
negatively amend, extend, or alter the coverage provided by the
policy of insurance to which the certificate of insurance makes
reference.
b. A certificate of insurance shall not warrant that the
policy of insurance referenced in the certificate of insurance
complies with the insurance or indemnification requirements
of a contract and the inclusion of a contract number or
description within a certificate of insurance shall not be
interpreted as warranting compliance with such requirements.
4. A person is entitled to notice of cancellation,
nonrenewal, or material change concerning a policy of insurance
or to any similar notice concerning a policy of insurance
-2-only if the person has such rights to notice under the terms
of the policy of insurance or any endorsement to the policy
of insurance. The terms and conditions of a person’s right
to notice are governed by the policy of insurance or the
endorsement and shall not be altered by a certificate of
insurance.
5. a. The provisions of this section are applicable to all
certificates of insurance issued in connection with property,
operations, or risks located in this state, regardless of
where the policyholder, insurer, insurance producer, or person
requesting or requiring the issuance of a certificate of
insurance is located.
b. A certificate of insurance or any other document or
correspondence prepared, issued, requested, or required in
violation of this section is null and void.
6. The commissioner of insurance may do all of the
following:
a. Examine and investigate the activities of any person that
the commissioner reasonably believes has been or is engaged in
an act or practice prohibited under this section.
b. Enforce the provisions of this section, including the
authority to issue orders to cease and desist, and to impose a
penalty in an amount of five hundred dollars per violation to
be collected in the name of the state for deposit as provided
in section 505.7.
c. Adopt rules pursuant to chapter 17A to administer this
section.
Sec. 2. EFFECTIVE UPON ENACTMENT. This Act, being deemed of
immediate importance, takes effect upon enactment.
Sec. 3. APPLICABILITY. This Act applies to certificates of
insurance prepared, issued, requested, or required beginning
ninety days after the effective date of this Act.
______________________________
LINDA UPMEYERSpeaker of the House______________________________
JACK WHITVERPresident of the Senate I hereby certify that this bill originated in the House and is known as House File 309, Eighty-seventh General Assembly.______________________________
CARMINE BOALChief Clerk of the HouseApproved _______________, 2017______________________________
TERRY E. BRANSTADGovernorav/nh