Use of credit-based insurance scores, regulatory reform, medical liability and auto repair issues were among the most significant bills considered during the 2003 regular legislative session in Nevada, which concluded earlier this month.
Nevada joined other states this year in adopting legislation regarding the use of insurance scores. The new law is based on model legislation by the National Conference of Insurance Legislators (NCOIL). Regulatory reform of personal lines insurance failed to muster support, according the National Association of Independent Insurers (NAII).
“We’re disappointed that flex-rating legislation didn’t come to fruition this year,” said Sam Sorich, vice president and western regional manager of the NAII, a strong proponent of such reforms. The bill passed the Senate, but died in the Assembly. “The measure would have encouraged greater price competition and created incentives for insurers to write more business and compete more aggressively in the state.
“Nevada’s current prior approval system creates an inherent delay that comes with the need to submit, review and approve rate changes. Flex-rating would have moderated the level of rate changes in the state, helping to avoid the jolt of major rate adjustments, and fostered a more competitive insurance market.”
The Nevada legislature passed SB 319, which incorporated provisions from the NCOIL insurance scoring model bill. Gov. Kenny Guinn signed SB 319 into law on June 10. Nevada will join 12 other states that have enacted versions of the NCOIL model this year, creating more uniform and consistent legislation that protects consumers and provides companies the ability to continue to utilize insurance scores to underwrite and rate auto and homeowners policies, Sorich said.
Key provisions of the NCOIL model require insurers to re-underwrite and re-rate policyholders whose credit reports were corrected, notify applicants that credit information will be used in underwriting and rating, and file credit scoring models with the state Department of Insurance, among other requirements. The insurance scoring provisions in SB 319 will go into affect on July 1, 2004.
In the area of auto repair, Assembly Bill 325 was also signed into law.
It establishes statutory definitions for “salvage vehicle,” “nonrepairable vehicle,” and “total loss vehicle.” On May 13, Gov. Guinn signed AB 367 into law, which requires an automobile insurer to notify a claimant that the claimant has a right to choose any licensed body shop to repair his or her car.
SB 122, also signed into law, restricts the elements that may be included in medical liability rate filings and requires medical liability insurers to provide notices before terminating or nonrenewing policies. AB 325, AB 367 and SB 122 take effect Oct. 1, 2003.
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