Relating to matters involving insurance and the insurance division of the department of commerce, providing fees, and resolving inconsistencies

This bill relates to various matters involving insurance and the insurance division of the department of commerce. The bill is organized into two divisions. DIVISION I —— INSURANCE.7 (cease and desist orders) is amended to provide that a person who violates any order of the insurance commissioner (commissioner), may, after notice and hearing be subject to a monetary penalty and suspension or revocation of the person’s license. Current law provides that a person who violates a cease and desist order of the commissioner is subject to the penalty and suspension or revocation. Code chapter 514G (long-term care insurance) is amended to change terminology throughout the Code chapter from an “independent review entity” to an “independent review organization”.4 (notice of cancellation —— reasons) to provide more specification regarding when a person can be excluded from an automobile insurance policy due to the person’s driver’s license being suspended or revoked during the term of the policy or a renewal of the policy.32 is amended to add reciprocal insurers to the definition of “insurer”.36 is amended to change the make-up of the membership of the governing committee that administers the FAIR plan.29, the insurer must notify the named insured that the named insured may be eligible for basic property insurance through the FAIR plan. The notice must accompany the notice of cancellation or the intent not to renew.4 (requirements for eligible surplus lines insurers) to allow a nonadmitted insurer seeking to qualify as an eligible surplus line insurer the option of demonstrating that the nonadmitted insurer has capital and surplus under the laws of the nonadmitted insurer’s domiciliary that equal the risk-based capital level requirements required by Iowa law. Current law requires the nonadmitted insurer to demonstrate that the nonadmitted insurer has capital and surplus under the laws of the nonadmitted insurer’s domiciliary that equal the greater of the minimum capital and surplus required under the laws of this state, or $15 million.7 (fees —— expenses of division —— assessments) that have been collected due to insurers’ failure to file a timely own risk and solvency assessment summary report.7 requires the commissioner to transfer the collected penalties to the treasurer of state for deposit in the department of commerce revolving fund. Current law requires the commissioner to deposit the penalties into the general fund of the state. DIVISION II —— CEMETERY AND PRENEED SELLERS AND SALES.204 (preneed seller annual reporting requirements) to require a preneed seller to file an annual report no later than April 15. Current law requires the report to be filed by April 1. The bill allows the commissioner to impose a late fee of $5 per day, up to a maximum late fee of $500.7. The bill specifies that a preneed seller’s license expires annually on April 30, rather than the current expiration date of April 15.502A (sales agent annual reporting requirements) is amended to require a sales agent to file the sales agent’s annual report by April 15, rather than the current due date of April 1. The bill allows the commissioner to impose a late fee of $5 per day, up to a maximum late fee of $500.7. The bill allows the commissioner to impose a civil penalty or to issue an order prohibiting the person from selling funeral merchandise, cemetery merchandise, or funeral services.601 is amended to require all purchase agreements, including purchase agreements delivered or executed by electronic means, to identify a sales agent. The purchase agreement must also be reviewed by the sales agent and signed by the purchaser and seller. If the purchase agreement is for mortuary science services, the purchase agreement must also be signed by a person licensed to deliver funeral services.812 (insurance division regulatory fund) and removes the prohibition on an annual allocation to the regulatory fund if the current balance of the fund exceeds $500,000.102 is amended to exclude specific cemeteries under the jurisdiction and control of a cemetery commission that has jurisdiction and control over pioneer cemeteries from the definition of “cemetery” for purposes of Code chapter 523I (Iowa cemetery Act).213 (insurance division’s enforcement fund) is amended to remove the cap on the allocation to the insurance division’s enforcement fund of examination fees paid by perpetual cemeteries with a perpetual cemetery’s annual report. The bill requires the commissioner to deposit all of the examination fees in the enforcement fund.301 (disclosure requirements —— prices and fees) is amended to require a cemetery to disclose, prior to the sale of interment rights, whether opening and closing services are included in the purchase price. The bill also requires a cemetery to fully disclose all fees associated with disinterment services.808 to require an examination fee of $10 per certificate of interment rights issued to be filed with a perpetual care cemetery’s annual report. Under current law, the fee is $5 per certificate of interment rights issued.813 (annual report by perpetual care cemeteries) to allow, rather than to require, the commissioner to impose a late penalty on a perpetual care cemetery that fails to file its annual report on time.