HF 3567

1st Engrossment - 90th Legislature (2017 - 2018) Posted on 05/10/2018 03:04pm

A bill for an act
relating to insurance; regulating affinity group coverages and insurance fraud;
amending Minnesota Statutes 2016, sections 60A.06, subdivision 1; 60A.37,
subdivision 2; 65B.44, subdivision 2a; Minnesota Statutes 2017 Supplement,
section 72A.328, subdivision 1.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2016, section 60A.06, subdivision 1, is amended to read:

Subdivision 1.

Statutory lines.

Insurance corporations may be authorized to transact in
any state or territory in the United States, in the Dominion of Canada, and in foreign
countries, when specified in their charters or certificates of incorporation, either as originally
granted or as thereafter amended, any of the following kinds of business, upon the stock
plan, or upon the mutual plan when the formation of such mutual companies is otherwise
authorized by law; and business trusts as authorized by law of this state shall only be
authorized to transact in this state the following kind of business hereinafter specified in
clause (7) hereof when specified in their "declaration of trust":

(1) To insure against loss or damage to property on land and against loss of rents and
rental values, leaseholds of buildings, use and occupancy and direct or consequential loss
or damage caused by fire, smoke or smudge, water or other fluid or substance, lightning,
windstorm, tornado, cyclone, earthquake, collapse and slippage, rain, hail, frost, snow,
freeze, change of temperature, weather or climatic conditions, excess or deficiency of
moisture, floods, the rising of waters, oceans, lakes, rivers or their tributaries, bombardment,
invasion, insurrection, riot, civil war or commotion, military or usurped power, electrical
power interruption or electrical breakdown from any cause, railroad equipment, motor
vehicles or aircraft, accidental injury to sprinklers, pumps, conduits or containers or other
apparatus erected for extinguishing fires, explosion, whether fire ensues or not, except
explosions on risks specified in clause (3); provided, however, that there may be insured
hereunder the following: (a) explosion of any kind originating outside the insured building
or outside of the building containing the property insured, (b) explosion of pressure vessels
which do not contain steam or which are not operated with steam coils or steam jackets;
and (c) risks under home owners multiple peril policies;

(2)(a) To insure vessels, freight, goods, wares, merchandise, specie, bullion, jewels,
profits, commissions, bank notes, bills of exchange, and other evidences of debt, bottomry
and respondentia interest, and every insurance appertaining to or connected with risks of
transportation and navigation on and under water, on land or in the air;

(b) To insure all personal property floater risks;

(3) To insure against any loss from either direct or indirect damage to any property or
interest of the assured or of another, resulting from the explosion of or injury to (a) any
boiler, heater or other fired pressure vessel; (b) any unfired pressure vessel; (c) pipes or
containers connected with any of said boilers or vessels; (d) any engine, turbine, compressor,
pump or wheel; (e) any apparatus generating, transmitting or using electricity; (f) any other
machinery or apparatus connected with or operated by any of the previously named boilers,
vessels or machines; and including the incidental power to make inspections of and to issue
certificates of inspection upon, any such boilers, apparatus, and machinery, whether insured
or otherwise;

(4) To make contracts of life and endowment insurance, to grant, purchase, or dispose
of annuities or endowments of any kind; and, in such contracts, or in contracts supplemental
thereto to provide for additional benefits in event of death of the insured by accidental
means, total permanent disability of the insured, or specific dismemberment or disablement
suffered by the insured, or acceleration of life or endowment or annuity benefits in advance
of the time they would otherwise be payable;

(5)(a) To insure against loss or damage by the sickness, bodily injury or death by accident
of the assured or dependents, or those for whom the assured has assumed a portion of the
liability for the loss or damage, including liability for payment of medical care costs or for
provision of medical care;

(b) To insure against the legal liability, whether imposed by common law or by statute
or assumed by contract, of employers for the death or disablement of, or injury to, employees;

(6) To guarantee the fidelity of persons in fiduciary positions, public or private, or to
act as surety on official and other bonds, and for the performance of official or other
obligations;

(7) To insure owners and others interested in real or personal property as described in
section 68A.04;

(8) To insure against loss or damage by breakage of glass, located or in transit;

(9)(a) To insure against loss by burglary, theft, or forgery;

(b) To insure against loss of or damage to moneys, coins, bullion, securities, notes, drafts,
acceptance or any other valuable paper or document, resulting from any cause, except while
in the custody or possession of and being transported by any carrier for hire or in the mail;

(c) To insure individuals by means of an all risk type of policy commonly known as the
"personal property floater" against any kind and all kinds of loss of or damage to, or loss
of use of, any personal property other than merchandise;

(d) To insure against loss or damage by water or other fluid or substance;

(10) To insure against loss from death of domestic animals and to furnish veterinary
service;

(11) To guarantee merchants and those engaged in business, and giving credit, from loss
by reason of giving credit to those dealing with them; this shall be known as credit insurance;

(12) To insure against loss or damage to automobiles or other vehicles new text begin , including
watercraft, new text end or aircraft and their contents, by collision, fire, burglary, or theft, and other perils
of operation, and against liability for damage to persons, or property of others, by collision
with such vehicles or aircraft, and to insure against any loss or hazard incident to the
ownership, operation, or use of motor or other vehicles or aircraft;

(13) To insure against liability for loss or damage to the property or person of another
caused by the insured or by those for whom the insured is responsible, including insurance
of medical, hospital, surgical, funeral or other related expense of the insured or other person
injured, irrespective of legal liability of the insured, when issued with or supplemental to
policies of liability insurance;

(14) To insure against loss of or damage to any property of the insured, resulting from
the ownership, maintenance or use of elevators, except loss or damage by fire;

(15) To insure against attorneys fees, court costs, witness fees and incidental expenses
incurred in connection with the use of the professional services of attorneys at law.

Sec. 2.

Minnesota Statutes 2016, section 60A.37, subdivision 2, is amended to read:

Subd. 2.

Exceptions.

This section does not apply if the policyholder has insured
elsewhere, has accepted replacement coverage, deleted text begin or deleted text end new text begin if the policyholder is transferred to an
affiliate of the insurer, provided that the affiliate complies with section 60A.351, or the
policyholder new text end has requested or agreed to nonrenewal. new text begin Documents signed or approved by the
policyholder are applicable to the coverage being transferred to an affiliate and remain valid
and enforceable to the same extent as they would be to renewal of the policy with the insurer.
new text end

Sec. 3.

Minnesota Statutes 2016, section 65B.44, subdivision 2a, is amended to read:

Subd. 2a.

Person convicted of insurance fraud.

(a) A person convicted of new text begin or pleading
guilty to new text end insurance fraud under section 609.611 in a case related to this chapter or of
employment of runners under section 609.612 new text begin , or convicted under or pleading guilty to any
federal or state law criminalizing fraud in a case related to no-fault automobile insurance, new text end
may not enforce a contract for payment of services eligible for reimbursement under
subdivision 2 against an insured or reparation obligor.

(b) After a period of five years from the date of conviction, a person described in
paragraph (a) may apply to district court to extinguish the collateral sanction set forth in
paragraph (a), which the court may grant in its reasonable discretion.

Sec. 4.

Minnesota Statutes 2017 Supplement, section 72A.328, subdivision 1, is amended
to read:

Subdivision 1.

Definitions.

(a) For purposes of this section the following terms have
the meanings given.

(b) "Affinity program" means a group of individuals who are members of an entity that
offers individuals benefits based on their membership in that entity. Affinity program does
not include an entity that obtains group insurance, as defined in section 60A.02, subdivision
28, or risk retention groups as defined in section 60E.02, subdivision 12.

(c) "Policy" means an individually underwritten policy of private passenger vehicle
insurance, as defined in section 65B.001, subdivision 2, an individually underwritten policy
of homeowner's insurance, as defined in section 65A.27, subdivision 4, or an individually
underwritten policy issued under section 60A.06, subdivision 1, clause (10) deleted text begin . deleted text end new text begin , or an
individually underwritten policy issued under section 60A.06, subdivision 1, clause (12),
or a commercial policy as defined by the commissioner in rule.
new text end