Senate Bill sb2222c1
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Florida Senate - 2007 CS for SB 2222
By the Committee on Banking and Insurance; and Senator Posey
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1 A bill to be entitled
2 An act relating to health insurance policies;
3 amending s. 627.6043, F.S.; providing
4 policyholders with the right to designate at
5 least one secondary addressee to receive a
6 notice of cancellation or nonrenewal for
7 nonpayment of premium; requiring insurers to
8 notify the policyholder of his or her right at
9 least once every 2 years; providing for a
10 designation form; providing for a waiver of the
11 right; requiring the inclusion of specific
12 language in each waiver; providing requirements
13 for the delivery of a notice of cancellation or
14 nonrenewal; providing for policy reinstatement
15 upon a sufficient demonstration of cognitive
16 impairment or loss of functional capacity;
17 defining the term "cognitive impairment";
18 authorizing insurers to require payment of an
19 interest charge on the overdue unpaid premium;
20 providing for the deduction of unpaid premium
21 plus interest from claim settlements under
22 certain circumstances; providing an effective
23 date.
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25 Be It Enacted by the Legislature of the State of Florida:
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27 Section 1. Subsections (4), (5), and (6) are added to
28 section 627.6043, Florida Statutes, to read:
29 627.6043 Notification of cancellation, nonrenewal, or
30 change in rates.--
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Florida Senate - 2007 CS for SB 2222
597-2348-07
1 (4) Each policyholder or applicant has the right to
2 designate at least one person, in addition to the insured, who
3 is to receive notice of cancellation or nonrenewal for
4 nonpayment of premium. For policies issued or renewed on or
5 after October 1, 2007, the insurer shall notify the
6 policyholder at least once every 2 years of the policyholder's
7 right to designate a secondary addressee. Designation does not
8 constitute acceptance by the insurer of any liability for the
9 additional parties. The form used for the written designation
10 must provide space clearly designated for listing at least one
11 person. The designation shall include each person's full name
12 and home address. Each policyholder or applicant who elects
13 not to designate a secondary addressee shall execute a waiver.
14 The waiver remains effective until the policyholder designates
15 a secondary addressee on an executed form. The waiver must
16 state: "Protection against unintended lapse.--I understand
17 that I have the right to designate at least one person other
18 than myself to receive notice of cancellation or nonrenewal of
19 this policy due to nonpayment of premium. I understand that
20 notice will not be given until (...grace period...) days after
21 a premium is due and unpaid. I elect NOT to designate any
22 person to receive such notice."
23 (5) Notice of cancellation or nonrenewal due to
24 nonpayment of premium shall be given by first-class United
25 States mail, postage prepaid, and notice may not be given
26 until the end of the grace period for late payment of premium,
27 as required by s. 627.608. Notice shall be deemed given on the
28 5th day after the date on which it is mailed.
29 (6) If a policy is canceled or nonrenewed due to
30 nonpayment of premium, the policyholder is entitled to have
31 the policy reinstated if the policyholder or any secondary
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Florida Senate - 2007 CS for SB 2222
597-2348-07
1 addressee designated pursuant to subsection (4) demonstrates
2 within not less than 150 days after the date of cancellation
3 or nonrenewal that the failure to pay the premium when due was
4 unintentional and due to the cognitive impairment or loss of
5 functional capacity of the policyholder. Under these
6 circumstances, reinstatement of the policy is subject to
7 payment of overdue premiums. As used in this subsection, the
8 term "cognitive impairment" means a deficiency in a person's
9 short-term or long-term memory; orientation as to person,
10 place, and time; deductive or abstract reasoning; or judgment
11 as it relates to safety awareness. The insurer may require
12 payment of an interest charge of not more than 8 percent per
13 year for the number of days elapsing before the payment of the
14 premium. During this period, the policy remains in effect if
15 the claimant or the claimant's representative makes a
16 sufficient demonstration of cognitive impairment. If a claim
17 is made under the policy during the grace period for late
18 payment or the 150-day period after the date of cancellation
19 or nonrenewal and before the overdue premium is paid, the
20 amount of the premium or premiums plus any applicable interest
21 as described in this subsection may be deducted from any
22 settlement under the policy.
23 Section 2. This act shall take effect October 1, 2007.
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Florida Senate - 2007 CS for SB 2222
597-2348-07
1 STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
COMMITTEE SUBSTITUTE FOR
2 Senate Bill 2222
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4 The committee substitute provides the following changes:
5 1. Clarifies that each policyholder be given the right to
designate at least one person, in addition to the
6 insured, to receive notice of cancellation or non-renewal
for nonpayment of premium.
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2. Provides an effective date of October 1, 2007.
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3. Defines "cognitive impairment".
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4. Makes the bill consistent with the current requirements
10 for a grace period for late payment on premiums.
11 5. Provides that if a policyholder makes a written rejection
of the option to notify a secondary person, this must
12 only be done one time.
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