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SPONSOR: |
Park |
DATE TYPED: |
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HB |
44/aHBIC/aHJC/aSCORC/SJC |
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SHORT TITLE: |
Insurance Policy in English and Spanish |
SB |
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ANALYST: |
Valenzuela |
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APPROPRIATION
Appropriation
Contained |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
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FY03 |
FY04 |
FY03 |
FY04 |
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NFI |
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(Parenthesis
( ) Indicate Expenditure Decreases)
Legislative Finance Committee files
Responses
Received From
Public
Regulation Commission
SUMMARY
The
Senate Judiciary Committee (SJC) amendment makes two clarifications to the
SCORC amendment. The first revision adds commercial “surplus lines insurance”
under the list of exempt insurance plans required to provide policy declaration
pages in both English and Spanish. The second revision corrects the language
from the word “declarant” to “declarations” page. Declarant has a specific meaning, that is a
person who has signed a declaration of intention of becoming a
The
Senate Corporations and Transportation Committee (SCORC) amendment to House
Bill 44 rewrites language that provides for the English and Spanish language
requirement to all insurance contracts, except workers’ compensation,
commercial multiple peril, or commercial general liability insurance policies.
The amendment also adds the following language as a disclaimer, “The provisions
provided in Spanish shall not govern the rights and responsibilities of the
parties but are provided for information only.”
Synopsis of HJC Amendment
The
House Judiciary Committee (HJC) amendment to House Bill 44 strikes the HBIC
amendment and clarifies which declaration page is required to be provided to
consumers in both Spanish and English. According to the PRC, policy declaration
pages are classified differently among insurance product lines. This amendment
ensures that English/Spanish language issue applies to
these
different product lines. The amendment further pushes back the effective date
to
The
House Business and Industry Committee (HBIC) amendment to House Bill 44 adds language
that requires insurance companies to provide an English or Spanish version of
the policy declaration page, only if requested by the client.
Synopsis
of Original Bill
House Bill 44 amends
the New Mexico Insurance Code to require insurance policy declarations be
written in both English and Spanish languages.
Significant
Issues
Several state agencies provide insurance
contracts to retirees, public school or higher education employees, and state
employees. However, the state is self insured and may be exempt from the
Insurance Code. HB 44 does not address this issue.
FISCAL IMPLICATIONS
HB 44 does not carry
an appropriation. Enactment of the bill could have a minor administrative or
fiscal impact on the Insurance Division of the Public Regulation Commission as
a result of insurance companies submitting its revised policy declaration
provisions. Although, the division likely would be able to absorb this minor
increased workload with its existing resources.
TECHNICAL ISSUES
PRC
reports the following technical issues: 1) which portion of
the contracts are involved and 2) should both commercial and personal lines be
included. First, the
bill as drafted requires the “policy declaration provisions” be written in both
English and Spanish. While the term policy declarations has meaning in property
and casualty insurance contracts, these contracts usually contain a policy
declaration page, not policy declaration provisions. Life insurance, health insurance and annuity
contracts use different terms to refer to this page. Most contracts have a page with basic data
concerning the coverage. Second, the bill as drafted would place this dual language
requirement on contracts issued to both individuals and corporations.
POSSIBLE QUESTIONS
Would state agencies, who provide
insurance contracts to retirees or state employees, be required to comply with this law ?