Moving Season Underway at the Tennessee Legislature

As the Tennessee General Assembly speeds through its session, we have begun to see movement on a few bills of interest to the industry:

SB1795/HB1598 Ketron/Eldridge – Commercial Law Exemptions
This bill, spearheaded by the American Insurance Association, passed Senate and House Committees this week and likely will have support in the House Insurance Committee on the way to the respective Floors within the next two weeks. The bill exempts certain lines of insurance (Boiler, Environmental, Kidnap & Ransom, Expropriation, EPL, Media Liability, Product Liability and Recall Coverage) from filing requirements. The bill would become law immediately after it is signed by the Governor and a Public Chapter number is assigned. Passage is likely in about six to eight weeks.

As part of the bill, insurance carriers are mandated to transmit to the Policyholder and Producer copies of the Policy. In that copy the following language must be included, “The rate provided for in this policy and all forms utilized are exempt from the filings requirements of Tenn. Code Ann 56-5-106. The forms that make up this policy contract are exempt from the filing requirements of Tenn. Code Ann 56-5-105.”

SB2530/HB2282 Ketron/Kane – Reattempting Examinations for Insurance Licensure

Will allow first-timers who fail the licensing test the ability to retake the test after waiting ten days instead of the current 30 day wait. The requirement after the second failure is still 30 days.

SB1862/HB1977 Stevens/Marsh – Requirements for Insurance Policies  
A major purpose of this bill is to specify that the duty to defend depends solely on the allegations contained in the underling complaint describing acts or events covered by the policy of insurance. As stated by a bill sponsor, this is a "pre-emptive strike" assuring that the legislature will make that definition rather than the court’s creating their own definitions. There is no change in current law or the way decisions to defend are changing. However, some out-of-state  courts have defined the duty to defend as a separate coverage which could require that insurance carriers defend all claims without regard to whether they are covered acts in the policy. Farm Bureau is the primary bill sponsor.

SB2510/HB2094 Ketron/Curcio – Surplus Lines changes   
This bill removes the need for an insurance producer to have a Surplus Lines license unless the agent represents the non-admitted insurer directly. The bill specifically allows sharing of commissions by Surplus Lines Individuals with writing agents who do not have such a license. This bill will come effective on the day it becomes law, and was brought by the Wholesale & Specialty Insurance Assoc.

SB2659/HB2396 Bailey/Sargent –Authorizes Nonprofit Dental Corps to Offer Vision Services  
This bill is brought by Delta Dental and allows for broadening of the current product line and only applies to nonprofit dental corporations.