SB0386

SENATE BILL 386

51st legislature - STATE OF NEW MEXICO - first session, 2013

INTRODUCED BY

Carroll H. Leavell

AN ACT

RELATING TO INSURANCE; CLARIFYING CERTAIN TERMS OF TRAVEL INSURANCE SALES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 59A-12-17 NMSA 1978 (being Laws 1984, Chapter 127, Section 218, as amended by Laws 1999, Chapter 272, Section 11 and also by Laws 1999, Chapter 289, Section 12) is amended to read:

"59A-12-17. SCOPE OF LICENSE.--

A. Except as to limited licenses identified in Section 59A-12-18 NMSA 1978 and Section 3 of this 2013 act, an agent's or broker's license shall cover the kind of insurance, or major subdivisions of life or health insurance, for which the applicant has applied and qualified, including [of] the following:

(1) life insurance, or any or all of the following subdivisions thereof:

(a) industrial life insurance;

(b) debit insurance;

(d) variable annuity contracts;

(2) health insurance, credit health insurance or industrial health insurance, or other subdivisions thereof;

(3) property insurance;

(4) casualty insurance;

(5) surety insurance;

(6) marine and transportation insurance;

(7) vehicle insurance; or

(8) title insurance.

B. The scope of a solicitor's license is subject to Section 59A-12-14 NMSA 1978.

C. License of a broker shall cover the kind or kinds of insurance applied and qualified for, within the classifications stated in Subsection A of this section.

D. A licensee as to variable annuities or similar contracts deemed to constitute also securities, shall also possess license as a security salesman under other applicable state laws."

SECTION 2. Section 59A-12-18 NMSA 1978 (being Laws 1984, Chapter 127, Section 219, as amended) is amended to read:

"59A-12-18. LIMITED LICENSE--CREDIT LIFE OR HEALTH--PORTABLE ELECTRONICS.--

A. The superintendent may issue a limited agent's license to [(1) individual applicants qualified pursuant to Chapter 59A, Article 12 NMSA 1978 and employed as transportation ticket sellers by public carriers, who in the course of such employment solicit or sell insurance incidental to transportation of persons or storage or transportation of baggage; provided that the license is limited to that insurance; or

(2)] individual applicants employed full time by a vendor of merchandise or other property or by a financial institution making consumer loans, on terms with respect to which credit life insurance or health insurance under individual policies is customarily required of or offered to the purchaser or borrower, covering only that credit life and health insurance.

B. The superintendent may issue a limited agent's license to applicants who are retail vendors or lessors of portable electronics or services. The license shall authorize any employee or authorized representative of the vendor, in connection with the lease, retail sale or provision of portable electronics or services for portable electronics, to sell insurance covering the loss, theft, mechanical failure or malfunction of or damage to the portable electronics. A license issued pursuant to this section shall authorize the licensee and its employees or authorized representatives to engage only in those activities that are expressly permitted in this section. The licensee shall be required to keep a record of the name, address, contact information and any other information of the locations operating pursuant to this section as required by the superintendent. These records shall be made available by the vendor upon the request of the superintendent. The licensee shall provide training to all employees and authorized representatives of the vendors who sell that insurance. The conduct of the licensee's business under the limited license by its employees or authorized representatives shall be attributed to the licensee. As used in this subsection, "portable electronics" means electronic devices that are portable in nature and their accessories and services related to the use of the device.

C. No holder of a limited license issued pursuant to Subsection A of this section shall concurrently be otherwise licensed under the Insurance Code."

SECTION 3. A new section of Chapter 59A, Article 12 NMSA 1978 is enacted to read:

"[NEW MATERIAL] LIMITED LICENSE--TRAVEL INSURANCE.--

A. The superintendent may issue a limited agent's license to applicants who are qualified to solicit or sell travel insurance.

B. A travel retailer may offer and disseminate travel insurance under the license of a limited lines travel insurance agent only if:

(1) the limited lines travel insurance agent or travel retailer provides to purchasers of travel insurance:

(a) a description of the material terms of the insurance coverage;

(b) a description of the process for filing a claim;

(d) the identity and contact information of the insurer and limited lines travel insurance agent;

(2) the limited lines travel insurance agent:

(a) establishes at the time of licensure on a form prescribed by the superintendent a register of each travel retailer that offers travel insurance on behalf of the limited lines travel insurance agent;

(b) includes in the register each travel retailer's federal tax identification number and the name, address and contact information of each travel retailer and an officer or person who directs or controls the travel retailer's operations;

(d) submits the register to the superintendent upon reasonable request; and

(e) certifies that each travel retailer on the register complies with federal laws;

(3) the limited lines travel insurance agent has selected a designated responsible agent who is one of its licensed individual agent employees and who is responsible for the limited lines travel insurance agent's compliance with the travel insurance laws and rules of this state;

(4) the designated responsible agent, president, secretary, treasurer and all other officers or persons who direct or control the limited lines travel insurance agent's insurance operations comply with the fingerprinting requirements for insurance agents of the resident state of the limited lines travel insurance agent;

(5) the limited lines travel insurance agent has paid all applicable insurance agent licensing fees pursuant to state law; and

(6) the limited lines travel insurance agent requires each employee and authorized representative of the travel retailer whose duties include offering and disseminating travel insurance to receive a program of instruction or training that the superintendent may review and that, at a minimum, contains instructions on the types of insurance offered, ethical sales practices and required disclosures to prospective customers.

C. A travel retailer that offers and disseminates travel insurance shall make available to prospective purchasers brochures or other written materials that:

(1) identify and provide the contact information of the insurer and the limited lines travel insurance agent;

(2) explain that the purchase of travel insurance is not a prerequisite to the purchase of any other product or service of the travel retailer; and

(3) explain that an unlicensed travel retailer may provide general information about the insurance offered by the travel retailer, including a description of the coverage and price, but is not qualified or authorized to answer technical questions about the terms and conditions of the insurance offered by the travel retailer or to evaluate the adequacy of the customer's existing insurance coverage.

D. A travel retailer's employee or authorized representative who is not licensed as an insurance agent shall not:

(1) evaluate or interpret the technical terms, benefits or conditions of the travel insurance coverage offered;

(2) evaluate or provide advice concerning a prospective purchaser's existing insurance coverage; or

(3) make representation as being a licensed insurer, licensed agent or insurance expert.

E. A travel retailer and its employees and authorized representatives whose insurance-related activities are limited to the offering and disseminating of travel insurance on behalf of and under the direction of a limited lines travel insurance agent that complies with this section may conduct and receive compensation for those activities.

F. A travel retailer may place insurance under an individual policy or under a group or master policy.

G. As the insurer designee, a limited lines travel insurance agent shall be responsible for the acts of the travel retailer and shall use reasonable means to ensure that the travel retailer complies with the provisions of this section.

H. As used in this section:

(1) "limited lines travel insurance agent" means a licensed managing general agent or third-party administrator or a licensed insurance agent;

(2) "offer and disseminate" means providing general information, including a description of coverage and price, processing applications, collecting premiums and performing other nonlicensable activities permitted by this state;

(3) "travel insurance" means insurance coverage for personal risks incident to planned travel, including the interruption or cancellation of a trip or event; the loss of baggage or personal effects; damage to accommodations or rental vehicles; or sickness, accident, disability or death during travel. "Travel insurance" excludes major medical plans that provide comprehensive medical protection for travelers on trips of six months or longer, such as for those working overseas as expatriates or deployed military personnel; and

(4) "travel retailer" means a business entity that makes, arranges or offers travel services."

SECTION 4. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2013.

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