44TH LEGISLATURE - STATE OF NEW MEXICO - FIRST SESSION, 1999

RELATING TO TITLE INSURANCE; EXEMPTING TITLE INSURERS FROM DUPLICATE REQUIREMENTS FOR FRAUD DETECTION; AMENDING SECTIONS OF THE NMSA 1978.

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

Section 1. Section 59A-16C-3 NMSA 1978 (being Laws 1998, Chapter 115, Section 3) is amended to read:

"59A-16C-3. DEFINITIONS.--As used in the Insurance Fraud Act:

A. "direct written premiums" means the amount of money received by the insurer as the premium for a policy of insurance minus commissions paid or retained by agents or direct sales operations;

[A.] B. "fund" means the insurance fraud fund;

[B.] C. "insurance fraud" means any act or practice in connection with an insurance transaction that constitutes a crime under the Criminal Code or the Insurance Code;

[C.] D. "insurance transaction" means any act or practice relating to insurance and includes complying with the Insurance Code or any rule adopted under its authority; and

[D.] E. "superintendent" means the superintendent of insurance."

Section 2. Section 59A-16C-14 NMSA 1978 (being Laws 1998, Chapter 115, Section 14) is amended to read:

"59A-16C-14. INSURANCE FRAUD FUND CREATED-- APPROPRIATION.--

A. There is [hereby] created an "insurance fraud fund" in the state treasury. All fees collected under the provisions of the Insurance Fraud Act shall be deposited in the fund and are subject to appropriation for use in paying the expenses incurred by the superintendent in carrying out the provisions of the Insurance Fraud Act. Interest on the fund shall be credited to the fund. The fund is a continuing, nonreverting fund.

B. To implement the provisions of the Insurance Fraud Act, [upon the effective date of the Insurance Fraud Act] the superintendent shall determine a rate of assessment and collect a fee from authorized insurers in an amount not less than two hundred dollars ($200) and not exceeding one-tenth of one percent of the correctly reported [gross] direct written premiums on policies written in New Mexico by the authorized insurers. The superintendent, after taking into account unexpended money produced by collection of the fee, shall adjust the rate of assessment each year to produce the amount of money that he estimates will be necessary to pay expenses incurred by the superintendent in carrying out the provisions of the Insurance Fraud Act.

C. In calculating the [gross] direct written premiums for an insurer pursuant to the provisions of this section, all [gross] direct written premiums for workers' compensation insurance shall be excluded from the calculation.

D. The fees required by this section are in addition to all other taxes and fees now imposed or that may be subsequently imposed."

Section 3. Section 59A-16C-15 NMSA 1978 (being Laws 1998, Chapter 115, Section 15) is amended to read:

"59A-16C-15. APPLICATION OF ACT TO OTHER ACTS.--

A. No authority granted the superintendent under the Insurance Fraud Act shall be construed to abrogate or interfere with the authority of the safety and fraud division of the workers' compensation administration under the Workers' Compensation Act or of the medicaid fraud control unit under the Medicaid Fraud Act.

B. Nothing in the Insurance Fraud Act shall:

(1) preempt the authority of or relieve the duty of any other law enforcement agencies to investigate and prosecute alleged violations of law;

(2) prevent or prohibit a person from voluntarily disclosing any information concerning insurance fraud to any law enforcement agency;

(3) limit any of the powers granted elsewhere by law to the superintendent to investigate alleged violations of law and take appropriate action; or

(4) interfere with the duties and authority of the workers' compensation administration.

C. A title insurer under the control and supervision of the superintendent pursuant to provisions of the New Mexico Title Insurance Law is not an insurer for purposes of the Insurance Fraud Act."