Alert Edition July 2020

Welcome to the July 2020 edition of the FORC Alert. If you have any colleagues that may be interested in this publication, please forward it on. There is a link on the Alerts main page where they can subscribe to receive FORC Alerts automatically.

Regards,
C. Ignacio Matos, Esq., FORC Alert Co-Editor
Ryan Smart, Esq., FORC Alert Co-Editor
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Blurb

Category(s): Alabama - 07/13/2020

Insurance Bulletin Item: COVID-19 Health Insurance Premium Reduction and Credit Program Filing Guidance

Bulletin No. 2020-13 

Stephen W. Still, Esq. - BALCH & BINGHAM LLP, (205) 488-5512 , sstill@balch.com

Category(s): Alabama - 07/13/2020

Insurance Bulletin Item: Extension of Transitional Relief

Bulletin No. 2020-14 

Stephen W. Still, Esq. - BALCH & BINGHAM LLP, (205) 488-5512 , sstill@balch.com

Category(s): Florida - 07/13/2020

Citizens Circulates 2020 Hurricane Season Information Agent Bulletin

On May 29, 2020, Citizens Property Insurance Corporation (Citizens) issued a bulletin outlining the 2020 hurricane season information to help prepare agents and policyholders for the season ahead. The agent bulletin details binding suspensions, loss claims, and additional resources. Click here  to view the bulletin.

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 768-8286 , fideir@gtlaw.com

Category(s): Florida - 07/13/2020

DFS Sets Assessment Rates for 2021

Pursuant to Florida Statutes, the Florida Department of Financial Services (DFS) is required to estimate the amount necessary for the administration to maintain the Special Disability Trust Fund and the Workers’ Compensation Administration Trust Fund, respectively. As such, the DFS issued two informational bulletins in late June setting the assessment rates for the 2021 calendar year:
• DWC-02-2020  – Order Setting Assessment Rate for the Special Disability Trust Fund for Calendar Year 2021
• DWC-03-2020  – Order Setting Assessment Rate for the Workers’ Compensation Administration Trust Fund for Calendar Year 2021

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG LLP, (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 07/13/2020

DWC Releases Report on Effects of COVID-19 on Florida’s Workers’ Compensation System

In June, the Florida Division of Workers’ Compensation (DWC) released a data summary report outlining the effects of COVID-19 on Florida’s workers’ compensation system. The DWC intends to continually update this report as new data is reported and analyzed. The 2020 report, as of May 31, 2020, can be found here .

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 768-8286 , fideir@gtlaw.com

Category(s): Florida - 07/13/2020

FHCF Advisory Council Approves Claims Paying Estimate

On May 19, 2020, the Florida Hurricane Catastrophe Fund (FHCF) Advisory Council met to review estimates and take a final vote on the May 2020 FHCF Claims-Paying Capacity. The FHCF solicited formal written feedback from the five current senior managing underwriters of the FHCF’s financial services team. The Advisory Council voted unanimously to accept the report. GT’s recap of the meeting can be viewed here .

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 768-8286 , fideir@gtlaw.com

Category(s): Florida - 07/13/2020

Florida Bill Bans Insurers’ Use of Genetic Info

On June 17, 2020, the Florida Legislature sent a bill to Governor Ron DeSantis to prohibit insurers from using consumers’ genetic information in changing, denying, or cancelling policies. While both state and federal law already prevent health insurance companies from considering a person’s genetic information when deciding if and at what price to cover a consumer, House Bill 1189  extends that ban to life, disability, and long-term care insurers. The Governor signed the bill into law on June 20, 2020, and it will take effect July 1, 2020. Florida becomes the latest of several states, including California, Vermont, and Maine, to restrict the use of genetic information by life insurers.

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 768-8286 , fideir@gtlaw.com

Category(s): Florida - 07/13/2020

OIR Provides Guidance to Insurers on Life & Health Products

In an effort to assist the industry in understanding the filing process and deadlines, the Florida Office of Insurance Regulation (OIR) issued a notice to provide guidance to insurers about the form and rate filing process in Florida for life and health insurance products, including Patient Protection and Affordable Care Act (PPACA) compliant products in the small and individual markets. Click here  to view the OIR notice issued on May 15, 2020.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG LLP, (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 07/13/2020

OIR Releases 2020 Catastrophe Reporting Form

In the event of a hurricane or natural disaster causing catastrophic damage, the Florida Office of Insurance Regulation (OIR) may institute a data call to collect claims and other relevant information from insurance companies related to the event. As such, the OIR released its final 2020 Catastrophe Reporting Form (CRF) on June 1, 2020, the first day of Florida’s 2020 hurricane season. The 2020 CRF can be found here .

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG LLP, (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 07/15/2020

OIR Takes Steps to Implement Proposed Corporate Governance Rule

The Florida Office of Insurance Regulation (OIR) is taking steps to finalize Draft Rule 69O-143.0466, Contents of Corporate Governance Annual Disclosure  by presenting the draft to the Financial Services Commission (FSC) at the next Florida Cabinet meeting (specific date to be determined) for approval to publish a Notice of Proposed Rule and start the 90-day rulemaking process. Once the 90-day period has concluded, the final version will be filed with the Department of State, and the rule will go into effect 20 days after the filing. This proposed rule would implement the NAIC Corporate Governance Annual Disclosure Model Act #305 and the NAIC Corporate Governance Annual Disclosure Model Regulation #306, which will only apply to future reports due after the rule is adopted.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG LLP, (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Georgia - 07/13/2020

BULLETIN 20-EX-8 - NEW PROCESSING FEE FOR ALL TRANSACTIONS

On July 1, 2020, a processing fee of $5.00 will be added to all incoming transactions with a payment associated, regardless of Department division or payment type. The new processing fee will address costs to maintain systems interfaces and the Department back office.

Tony Roehl, Esq. - MORRIS, MANNING & MARTIN, LLP, (404) 495-8477 , troehl@mmmlaw.com

Category(s): Georgia - 07/15/2020

Daily Underwriters of America v. Williams, (Case No. A19A2101, Ga. Ct. App., March 3, 2020)

Daily Underwriters of America provided commercial auto liability insurance to CC&D Trucking, LLC and a truck driven by its owner, Edward Heard. While driving his tractor-trailer, Heard hit the car in which Veronica and Marleaux Williams were traveling. Heard had driven his tractor-trailer from Bainbridge, Georgia to pick up a load in Charlotte, North Carolina for delivery in Monroe, Georgia. The accident involving Heard and the Williams occurred after Heard had completed his delivery and was driving from Monroe, Georgia back to his home in Bainbridge, Georgia. The Williams joined Daily Underwriters in their tort action brought against Heard under Georgia’s direct-action statute, O.C.G.A. § 40-1-112(c), which allows direct actions against insurers of intrastate motor carriers for the liability of an intrastate motor carriers’ negligence. The trial court denied Daily Underwriters’ motion for summary judgement on the basis that CC&D was an interstate motor carrier. The appellate court affirmed the denial, finding that, while Heard’s travel back to his home did not, under the “trip specific rule”, convert his trip to an intrastate trip where his original fixed and persisting intent was to retrieve a load of goods in North Carolina, O.C.G.A. § 40-1-140, the interstate motor carrier direct action statute, nevertheless applied even if the trial court’s denial of Daily Underwriters’ motion for summary judgement was for the wrong reason.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com

Category(s): Georgia - 07/13/2020

Frett v. State Farm Employee Workers’ Compensation, et al. (Case No. S19G0447, Ga. Supreme Ct., June 16, 2020)

The Georgia Supreme Court reconsidered and overruled its prior decision in Ocean Acc. & Guar. Corp. v. Farr, a 1935 workers’ compensation case holding that an employee’s injury that occurred during an employee’s schedule work break did not arise out of and in the course of employment because the work break was purely a personal matter.  In the Frett case, Rochell Fret, a State Farm employee, slipped and fell as she exited State Farm’s employee break room while she was on break for her lunch. The court agreed that over the years the Farr case had become conflicting with subsequent case law embracing the “ingress and egress rule” under which an employee’s injury occurring while entering or exiting an employer’s premises, originally for performance of employment services and later extended to ingress and egress for scheduled work breaks and to activities incidental to assigned work, which include using the restroom and eating a meal. Accordingly, the court found that Frett sustained an injury while in the course of her employment which occurred on the employer’s premises and her preparation of a lunch meal was incidental and reasonably necessary for her comfort at work and thus compensable under Georgia’s Workers’ Compensation Act.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com

Category(s): Georgia - 07/15/2020

Georgia Insurance Department COVID-19 Directives Updates

The Georgia Insurance Commissioner issued Bulletin 20-EX-7 on April 28, 2020, regarding the wind-down of certain prior COVID-19 pandemic directives as follows:

Directive 20-EX-4: May 31, 2020, expiration of insurance agents’ continuing education filing extension deadlines

Directive 20-EX-5:
• May 19, 2020: expiration of property and casualty insurers’ obligation to refrain from canceling for non-payment of premium commercial insurance policies with business interruption coverage
• May 31, 2020: expiration of heath insurers’ obligation to refrain from canceling for non-payment of premium health insurance policies
• May 31, 2020: expiration of suspension of insurance department filing deadlines and waiver of late filing fees    

Directive 20-EX-7: May 25, 2020, expiration of entire bulletin related to suspension of certain utilization review and notice requirements

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com

Category(s): Georgia - 07/15/2020

Georgia Legislative Updates

Legislative Updates – The Georgia Legislative adjourned sine die on June 26, 2020 after reconvening on June 15, 2020 from a COVID-19 pandemic break that started in mid-March, towards the end of its session, which usually wraps around the end of March. Key legislative bills adopted during this session and affecting the insurance industry, which remain subject to the Governor’s veto power, include:

• Liability Limitations for COVID-19 Claims (SB 359) – adopted the Georgia COVID-19 Pandemic Business Safety Act, which provides tort liability immunity for healthcare providers for certain COVID-19 exposures and acts or omissions unless claimant proves gross negligence, willful and wanton misconduct, or intentional or reckless infliction of harm, but law would expire for claims arising after July 14, 20201.
   
• Peer-to-Peer Car-Sharing (Senate Substitute for HB 337) – adopted the National Council of Insurance Legislators (NCOIL) Peer-to-Peer Car Sharing Program Model Act with minor changes.

• Surprise Medical Billing Relief (HB 888) – adopted the Surprise Billing Consumer Protection Act, new Chapter 20E of the Georgia Insurance Code. The bill requires health insurers providing emergency medical services coverage to pay for such service regardless of whether the healthcare provider is an in-network provider and without prior authorization and prohibits non-participating providers from collecting payment more than the applicable co-payment, deductible or other cost-sharing amount owed by an insured. The bill also requires that a health insurer pay providers for non-emergency medical services resulting in a surprise bill regardless of whether the provider is a participating provider.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com

Category(s): Georgia - 07/15/2020

Martin v. Chasteen, (Case No. A19A1980, Ga. Ct. App., March 3, 2020)

The Georgia Court of Appeals affirmed the trial court’s grant of summary judgement to insurance agent Thomas Chasteen in a suit brought against him by Mark Martin for Chasteen’s alleged negligent failure to procure property insurance for Martin’s new horse barn. In 2011, Martin purchased property insurance for his two dwellings and an equipment building from Chasteen. In 2013 and 2014, Martin built a new horse barn, which lightning destroyed in 2016, and was not insured under his property insurance policy insuring the other structures located on his farm. In finding that Chasteen was not liable to Martin, the court reiterated the general rule that an insured has a duty to read and examine his insurance policy to determine whether the desired insurance coverage has been obtained by the policy. In this case, Martin’s farm insurance policy’s declarations clearly showed that only the dwellings and equipment building were insured and the new horse barn had not been added as a covered structure to the farm insurance policy, even if the insured did not have a copy of the entire insurance policy and especially here where the policy was a renewal policy. Also, the court determined that Chasteen did not have a special relationship with Martin, which, if applicable, would have excused Martin from his duty to read the policy, and regardless the duty to read the policy would still have applied because it was readily apparent from the declarations page that the new barn was not insured.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com

Category(s): NAIC - 07/15/2020

The NAIC's Artificial Intelligence Working Group Adopts Principles for A.I.

On June 30, the working group approved principles that would require insurers and others using AI to take proactive steps to avoid proxy discrimination against protected classes. (Fifteen states voted in favor, and one abstained.) The principles urge insurers to implement mechanisms and safeguards to ensure compliance with applicable laws, including ongoing monitoring and when appropriate, human intervention. If your organization is using artificial intelligence, is it behaving responsibly? Would others agree?

Scott M. Kosnoff, Esq. - FAEGRE DRINKER, (317) 237-1201 , scott.kosnoff@faegredrinker.com

Category(s): Tennessee - 07/13/2020

Belinda Fortman Named Director of TDCI’s Captive Insurance Section

Longstanding captive insurance industry executive Belinda Fortman has been named by Tennessee Commissioner of Commerce and Insurance, Hodgen Mainda, as Director of the Tennessee Department of Commerce and Insurance, Captive Insurance Section.  Fortman, who succeeded Jennifer Stalvey as TDCI’s senior captives regulator on June 29, oversees Tennessee’s more than 200 licensed captives and 470 approved captive cells.

T. Stephen C. Taylor, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-7758 , staylor@bassberry.com
Robins H. Ledyard, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-6259 , rledyard@bassberry.com

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