Bill Text: IN HB1024 | 2011 | Regular Session | Amended
Bill Title: Property insurance.
Spectrum: Bipartisan Bill
Status: (Passed) 2011-05-16 - Effective 07/01/2011 [HB1024 Detail]
Download: Indiana-2011-HB1024-Amended.html
Citations Affected: IC 27-1; IC 27-7; IC 32-30.
Synopsis: Property insurance. Removes a requirement that the
insurance producer's contact information be included in written notice
concerning a change in a residential policy. Exempts coverage for
certain motor vehicles used for business purposes in connection with
a commercial policy from the law requiring an insurer to make
available uninsured and underinsured motorist coverage. Requires an
insurer to provide a written notice of residential policy cancellation in
a foreclosure action under certain circumstances. Requires the creditor
in a residential property foreclosure action to send a copy of the
complaint to the insurance company of record.
Effective: July 1, 2011.
January 5, 2011, read first time and referred to Committee on Insurance.
January 20, 2011, amended, reported _ Do Pass.
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in
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Conflict reconciliation: Text in a statute in this style type or
A BILL FOR AN ACT to amend the Indiana Code concerning
insurance.
(1) covers first party loss to property located in Indiana; and
(2) insures against loss or damage to:
(A) real property consisting of not more than four (4) residential units, one (1) of which is the principal place of residence of the named insured; or
(B) personal property in which the named insured has an insurable interest and that is used within a residential dwelling for personal, family, or household purposes.
(b) An insurer that reduces, restricts, or removes, through a rider or an endorsement, coverage provided by a policy of insurance must provide to the named insured written notice, through the United States mail or by electronic means, of the changes to the policy. The written notice required by this subsection must:
(1) be part of a document that is separate from the rider or endorsement;
(2) be printed in at least 12 point type, 1 point leaded;
(3) consist of text that achieves a minimum score of forty (40) on the Flesch reading ease test or an equivalent score on a comparable test approved by the commissioner as provided by IC 27-1-26-6;
(4) identify the forms, provisions, or endorsements that are changed;
(5) indicate the name and contact information of
(6) indicate whether a premium adjustment will result from the policy changes; and
(7) set forth any options available to the named insured to repurchase the coverage that has been reduced, restricted, or removed.
(c) If the notice required under subsection (b) is sent through the United States mail, the outside of the envelope used to mail the notice must contain the following statement in at least 14 point type: "Coverage has been reduced, restricted, or removed from your policy.".
(d) The insurer bears the burden to prove that notice was sent to the named insured in accordance with this section. If the notice is sent through the United States mail, proof of mailing as described in IC 27-7-6-7 is sufficient proof of the notice.
(e) The commissioner may adopt rules under IC 4-22-2 to implement this section.
(1) in limits for bodily injury or death and for injury to or
destruction of property not less than those set forth in IC 9-25-4-5
under policy provisions approved by the commissioner of
insurance, for the protection of persons insured under the policy
who are legally entitled to recover damages from owners or
operators of uninsured or underinsured motor vehicles because of
bodily injury, sickness or disease, including death, and for the
protection of persons insured under the policy who are legally
entitled to recover damages from owners or operators of
uninsured motor vehicles for injury to or destruction of property
resulting therefrom; or
(2) in limits for bodily injury or death not less than those set forth
in IC 9-25-4-5 under policy provisions approved by the
commissioner of insurance, for the protection of persons insured
under the policy provisions who are legally entitled to recover
damages from owners or operators of uninsured or underinsured
motor vehicles because of bodily injury, sickness or disease,
including death resulting therefrom.
The uninsured and underinsured motorist coverages must be provided
by insurers for either a single premium or for separate premiums, in
limits at least equal to the limits of liability specified in the bodily
injury liability provisions of an insured's policy, unless such coverages
have been rejected in writing by the insured. However, underinsured
motorist coverage must be made available in limits of not less than fifty
thousand dollars ($50,000). At the insurer's option, the bodily injury
liability provisions of the insured's policy may be required to be equal
to the insured's underinsured motorist coverage. Insurers may not sell
or provide underinsured motorist coverage in an amount less than fifty
thousand dollars ($50,000). Insurers must make underinsured motorist
coverage available to all existing policyholders on the date of the first
renewal of existing policies that occurs on or after January 1, 1995, and
on any policies newly issued or delivered on or after January 1, 1995.
Uninsured motorist coverage or underinsured motorist coverage may
be offered by an insurer in an amount exceeding the limits of liability
specified in the bodily injury and property damage liability provisions
of the insured's policy.
(b) A named insured of an automobile or motor vehicle liability
policy has the right, in writing, to:
(1) reject both the uninsured motorist coverage and the
underinsured motorist coverage provided for in this section; or
(2) reject either the uninsured motorist coverage alone or the
underinsured motorist coverage alone, if the insurer provides the
coverage not rejected separately from the coverage rejected.
A rejection of coverage under this subsection by a named insured is a rejection on behalf of all other named insureds, all other insureds, and all other persons entitled to coverage under the policy. No insured may have uninsured motorist property damage liability insurance coverage under this section unless the insured also has uninsured motorist bodily injury liability insurance coverage under this section. Following rejection of either or both uninsured motorist coverage or underinsured motorist coverage, unless later requested in writing, the insurer need not offer uninsured motorist coverage or underinsured motorist coverage in or supplemental to a renewal or replacement policy issued to the same insured by the same insurer or a subsidiary or an affiliate of the originally issuing insurer. Renewals of policies issued or delivered in this state which have undergone interim policy endorsement or amendment do not constitute newly issued or delivered policies for which the insurer is required to provide the coverages described in this section.
(c) A rejection under subsection (b) must specify:
(1) that the named insured is rejecting:
(A) the uninsured motorist coverage;
(B) the underinsured motorist coverage; or
(C) both the uninsured motorist coverage and the underinsured motorist coverage;
that would otherwise be provided under the policy; and
(2) the date on which the rejection is effective.
(d) An insurer is not required to make available the coverage described in subsection (a) in a commercial umbrella or excess liability policy, including a commercial umbrella or excess liability policy that is issued or delivered to a motor carrier (as defined in IC 8-2.1-17-10) that is in compliance with the minimum levels of financial responsibility set forth in 49 CFR Part 387.
(e) A rejection under subsection (b) of uninsured motorist coverage or underinsured motorist coverage in an underlying commercial policy of insurance is also a rejection of uninsured motorist coverage or underinsured motorist coverage in a commercial umbrella or excess liability policy.
(f) An insurer is not required to make available the coverage described in subsection (a) in connection with coverage that:
(1) is related to or included in a commercial policy of property and casualty insurance described in Class 2 or Class 3 of IC 27-1-5-1; and
(2) covers a loss related to a motor vehicle that:
(A) is not owned by the insured; and
(B) is used for the business purposes of the insured.
(1) be in writing;
(2) be delivered or mailed to the named insured at the last known address of the named insured;
(3) state the effective date of the cancellation; and
(4) upon request of the named insured, be accompanied by a written explanation of the specific reasons for the cancellation.
(b) An insurer shall provide written notice of cancellation to the named insured at least:
(1) ten (10) days before canceling a policy, if the cancellation is for nonpayment of a premium;
(2) twenty (20) days before canceling a policy, if:
(A) the cancellation occurs more than sixty (60) days after the date of issuance of the policy; or
(B) the insurer has received a copy of a complaint under IC 32-30-10.5-8(d)(2) concerning the property; and
(3) ten (10) days before canceling a policy, if the cancellation occurs not more than sixty (60) days after the date of issuance of the policy.
(c) If the policy was procured by an independent insurance producer licensed in Indiana, the insurer shall deliver or mail notice of cancellation to the insurance producer not less than ten (10) days before the insurer delivers or mails the notice to the named insured, unless the obligation to notify the insurance producer is waived in writing by the insurance producer.
(1) Inform the debtor that:
(A) the debtor is in default;
(B) the debtor is encouraged to obtain assistance from a mortgage foreclosure counselor; and
(C) if the creditor proceeds to file a foreclosure action and obtains a foreclosure judgment, the debtor has a right to do the following before a sheriff's sale is conducted:
(i) Appeal a finding of abandonment by a court under IC 32-29-7-3(a)(2).
(ii) Redeem the real estate from the judgment under IC 32-29-7-7.
(iii) Retain possession of the property under IC 32-29-7-11(b), subject to the conditions set forth in IC 32-29-7-11(b).
(2) Provide the contact information for the Indiana Foreclosure Prevention Network.
(3) Include the following statement printed in at least 14 point boldface type:
"NOTICE REQUIRED BY STATE LAW
Mortgage foreclosure is a complex process. People may approach you about "saving" your home. You should be careful about any such promises. There are government agencies and nonprofit organizations you may contact for helpful information about the foreclosure process. For the name and telephone number of an organization near you, please call the Indiana Foreclosure Prevention Network.".
(b) The notice required by subsection (a) shall be sent to:
(1) the address of the mortgaged property; or
(2) the last known mailing address of the debtor if the creditor's records indicate that the mailing address of the debtor is other than the address of the mortgaged property.
If the creditor provides evidence that the notice required by subsection (a) was sent by certified mail, return receipt requested, and as prescribed by this subsection, it is not necessary that the debtor accept receipt of the notice for an action to proceed as allowed under this chapter.
(c) Except as provided in subsection (e) and section 10(g) of this chapter, if a creditor files an action to foreclose a mortgage, the creditor shall include with the complaint served on the debtor a notice that informs the debtor of the debtor's right to participate in a settlement conference. The notice must be in a form prescribed by the Indiana housing and community development authority created by IC 5-20-1-3. The notice must inform the debtor that the debtor may schedule a settlement conference by notifying the court, not later than thirty (30) days after the notice is served, of the debtor's intent to participate in a settlement conference.
(d) In a foreclosure action filed under IC 32-30-10-3 after June 30, 2009, the creditor shall do the following:
(1) Attach to the complaint filed with the court a copy of the notices sent to the debtor under subsections (a) and (c).
(2) At the time the complaint is filed with the court, send:
(A) by certified mail, return receipt requested; and
(B) to the last known mailing address of the insurance company;
a copy of the complaint filed with the court to the insurance company of record for the property that is the subject of the foreclosure action.
If the creditor provides evidence that a copy of the complaint was sent by the method prescribed by subdivision (2), it is not necessary that the insurance company accept receipt of the copy of the complaint for the creditor to satisfy the requirement of subdivision (2). A creditor's failure to provide a copy of the complaint as required by subdivision (2) does not prevent an action from proceeding as allowed under this chapter.
(e) A creditor is not required to send the notices described in this section if:
(1) the mortgage is secured by a dwelling that is not the debtor's primary residence;
(2) the mortgage has been the subject of a prior foreclosure prevention agreement under this chapter and the debtor has defaulted with respect to the terms of that foreclosure prevention agreement; or
(3) bankruptcy law prohibits the creditor from participating in a settlement conference under this chapter with respect to the mortgage.
