<a id="pl.1.3"></a><var>1.3</var>money;amending Minnesota Statutes 2008, sections 60K.36, subdivision 2; <br/>
<a id="pl.1.4"></a><var>1.4</var>60K.38, subdivision 1; Minnesota Statutes 2009 Supplement, section 60K.55, <br/>
<a id="pl.1.5"></a><var>1.5</var>subdivision 2; proposing coding for new law in Minnesota Statutes, chapter 60K.<br/>
<a id="pl.1.6"></a><var>1.6</var>BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:<br/>
<br/>
<a id="bill.0.1.0"></a><a id="pl.1.7"></a><var>1.7</var>    Section 1. Minnesota Statutes 2008, section 60K.36, subdivision 2, is amended to read:<br/>
<a id="pl.1.8"></a><var>1.8</var>    Subd. 2. <b>Examination not required.</b> A resident individual applying for a limited <br/>
<a id="pl.1.9"></a><var>1.9</var>lines credit insurance, title insurance, travel baggage insurance, mobile telephone <br/>
<a id="pl.1.10"></a><var>1.10</var>insurance, or bail bonds license is not required to take a written examination.<br/>
<br/>
<a id="bill.0.2.0"></a><a id="pl.1.11"></a><var>1.11</var>    Sec. 2. Minnesota Statutes 2008, section 60K.38, subdivision 1, is amended to read:<br/>
<a id="pl.1.12"></a><var>1.12</var>    Subdivision 1. <b>Issuance.</b> (a) Unless denied a license under section 
         <statute_ref>60K.43</statute_ref>, a person <br/>
<a id="pl.1.13"></a><var>1.13</var>who has met the requirements of sections 
         <statute_ref>60K.36</statute_ref> and 
         <statute_ref>60K.37</statute_ref> must be issued an insurance <br/>
<a id="pl.1.14"></a><var>1.14</var>producer license. An insurance producer may receive qualification for a license in one or <br/>
<a id="pl.1.15"></a><var>1.15</var>more of the lines of authority in paragraphs (b) and (c).<br/>
<a id="pl.1.16"></a><var>1.16</var>(b) An individual insurance producer may receive qualification for a license in <br/>
<a id="pl.1.17"></a><var>1.17</var>one or more of the following major lines:<br/>
<a id="pl.1.18"></a><var>1.18</var>(1) life insurance: coverage on human lives including benefits of endowment and <br/>
<a id="pl.1.19"></a><var>1.19</var>annuities, and may include benefits in the event of death or dismemberment by accident <br/>
<a id="pl.1.20"></a><var>1.20</var>and benefits for disability income;<br/>
<a id="pl.1.21"></a><var>1.21</var>(2) accident and health or sickness insurance: coverage for sickness, bodily injury, <br/>
<a id="pl.1.22"></a><var>1.22</var>or accidental death, and may include benefits for disability income;<br/>
<a id="pl.1.23"></a><var>1.23</var>(3) property insurance: coverage for the direct or consequential loss or damage to <br/>
<a id="pl.1.24"></a><var>1.24</var>property of every kind;<br/>
<a id="pl.2.1"></a><var>2.1</var>(4) casualty insurance: coverage against legal liability, including that for death, <br/>
<a id="pl.2.2"></a><var>2.2</var>injury, or disability, or damage to real or personal property;<br/>
<a id="pl.2.3"></a><var>2.3</var>(5) variable life and variable annuity products insurance: coverage provided under <br/>
<a id="pl.2.4"></a><var>2.4</var>variable life insurance contracts and variable annuities; and<br/>
<a id="pl.2.5"></a><var>2.5</var>(6) personal lines: property and casualty insurance coverage sold to individuals and <br/>
<a id="pl.2.6"></a><var>2.6</var>families for primarily noncommercial purposes.<br/>
<a id="pl.2.7"></a><var>2.7</var>(c) An individual insurance producer may receive qualification for a license in <br/>
<a id="pl.2.8"></a><var>2.8</var>one or more of the following limited lines:<br/>
<a id="pl.2.9"></a><var>2.9</var>(1) limited line credit insurance;<br/>
<a id="pl.2.10"></a><var>2.10</var>(2) farm property and liability insurance;<br/>
<a id="pl.2.11"></a><var>2.11</var>(3) title insurance;<br/>
<a id="pl.2.12"></a><var>2.12</var>(4) travel baggage insurance; and<br/>
<a id="pl.2.13"></a><var>2.13</var>(5) mobile telephone insurance; and<br/>
<a id="pl.2.14"></a><var>2.14</var>(6) (5) bail bonds.<br/>
<br/>
<a id="bill.0.3.0"></a><a id="pl.2.15"></a><var>2.15</var>    Sec. 3. <b>[60K.381] SALE OF PORTABLE ELECTRONICS INSURANCE.</b><br/>
<a id="pl.2.16"></a><var>2.16</var>    Subdivision 1. <b>Definitions.</b> For purposes of this section, the following terms have <br/>
<a id="pl.2.17"></a><var>2.17</var>the following meanings:<br/>
<a id="pl.2.18"></a><var>2.18</var>(a) "Customer" means a person who purchases portable electronics or services.<br/>
<a id="pl.2.19"></a><var>2.19</var>(b) "Covered customer" means a customer who elects coverage under a portable <br/>
<a id="pl.2.20"></a><var>2.20</var>electronics insurance policy issued to a vendor of portable electronics.<br/>
<a id="pl.2.21"></a><var>2.21</var>(c) "Portable electronics" means electronic devices that are portable in nature, their <br/>
<a id="pl.2.22"></a><var>2.22</var>accessories, and services related to the use of the device.<br/>
<a id="pl.2.23"></a><var>2.23</var>(d)(1) "Portable electronics insurance" means insurance providing coverage for <br/>
<a id="pl.2.24"></a><var>2.24</var>the repair or replacement of portable electronics, which may cover portable electronics <br/>
<a id="pl.2.25"></a><var>2.25</var>against any one or more of the following causes of loss: loss, theft, mechanical failure, <br/>
<a id="pl.2.26"></a><var>2.26</var>malfunction, damage, or other applicable perils.<br/>
<a id="pl.2.27"></a><var>2.27</var>(2) "Portable electronics insurance" does not include:<br/>
<a id="pl.2.28"></a><var>2.28</var>(i) a service contract governed by chapter 59B;<br/>
<a id="pl.2.29"></a><var>2.29</var>(ii) a policy of insurance covering a seller's or a manufacturer's obligations under <br/>
<a id="pl.2.30"></a><var>2.30</var>a warranty; or<br/>
<a id="pl.2.31"></a><var>2.31</var>(iii) a homeowner's, renter's, private passenger automobile, commercial multiperil, <br/>
<a id="pl.2.32"></a><var>2.32</var>or similar policy that covers loss or theft of portable electronics.<br/>
<a id="pl.2.33"></a><var>2.33</var>(e) "Portable electronics transaction" means:<br/>
<a id="pl.2.34"></a><var>2.34</var>(1) the sale or lease of portable electronics by a vendor to a customer; or<br/>
<a id="pl.3.1"></a><var>3.1</var>(2) the sale of a service related to the use of portable electronics by a vendor to a <br/>
<a id="pl.3.2"></a><var>3.2</var>customer.<br/>
<a id="pl.3.3"></a><var>3.3</var>(f) "Supervising agency" means a business entity that is a licensed insurance <br/>
<a id="pl.3.4"></a><var>3.4</var>producer.<br/>
<a id="pl.3.5"></a><var>3.5</var>(g) "Vendor" means a person in the business of engaging in portable electronics <br/>
<a id="pl.3.6"></a><var>3.6</var>transactions, directly or indirectly.<br/>
<a id="pl.3.7"></a><var>3.7</var>    Subd. 2. <b>Licensure of vendors.</b> (a) A vendor is required to hold a limited lines <br/>
<a id="pl.3.8"></a><var>3.8</var>license to sell or offer coverage under a policy of portable electronics insurance in <br/>
<a id="pl.3.9"></a><var>3.9</var>connection with, and incidental to, a portable electronics transaction with a customer.<br/>
<a id="pl.3.10"></a><var>3.10</var>(b) A limited lines license issued under this subdivision shall authorize any <br/>
<a id="pl.3.11"></a><var>3.11</var>employee or authorized representative of the vendor to sell or offer coverage under a <br/>
<a id="pl.3.12"></a><var>3.12</var>policy of portable electronics insurance to a customer in connection with, and incidental <br/>
<a id="pl.3.13"></a><var>3.13</var>to, a portable electronics transaction at each location at which the vendor engages in <br/>
<a id="pl.3.14"></a><var>3.14</var>portable electronics transactions. The application for such a limited lines license shall <br/>
<a id="pl.3.15"></a><var>3.15</var>set forth each location at which the vendor offers coverage under a policy of portable <br/>
<a id="pl.3.16"></a><var>3.16</var>electronics insurance. The vendor shall notify the commissioner within 30 days of adding <br/>
<a id="pl.3.17"></a><var>3.17</var>or eliminating such a location.<br/>
<a id="pl.3.18"></a><var>3.18</var>(c) Notwithstanding any other provision of law, a license issued pursuant to this <br/>
<a id="pl.3.19"></a><var>3.19</var>section shall authorize the licensee and its employees or authorized representatives to <br/>
<a id="pl.3.20"></a><var>3.20</var>engage only in those activities that are expressly permitted in this section.<br/>
<a id="pl.3.21"></a><var>3.21</var>    Subd. 3. <b>Requirements for sale of portable electronics insurance.</b> (a) At every <br/>
<a id="pl.3.22"></a><var>3.22</var>location where portable electronics insurance is offered to customers, brochures or other <br/>
<a id="pl.3.23"></a><var>3.23</var>written materials must be made available to a prospective customer which:<br/>
<a id="pl.3.24"></a><var>3.24</var>(1) disclose that portable electronics insurance may provide a duplication of <br/>
<a id="pl.3.25"></a><var>3.25</var>coverage already provided by a customer's homeowner's insurance policy, renter's <br/>
<a id="pl.3.26"></a><var>3.26</var>insurance policy, or other source of coverage;<br/>
<a id="pl.3.27"></a><var>3.27</var>(2) state that the enrollment by the customer in a portable electronics insurance <br/>
<a id="pl.3.28"></a><var>3.28</var>program is not required in order to purchase or lease portable electronics or services;<br/>
<a id="pl.3.29"></a><var>3.29</var>(3) summarize the material terms of the insurance coverage, including:<br/>
<a id="pl.3.30"></a><var>3.30</var>(i) the identity of the insurer;<br/>
<a id="pl.3.31"></a><var>3.31</var>(ii) the identity of the supervising agency;<br/>
<a id="pl.3.32"></a><var>3.32</var>(iii) the amount of any applicable deductible and how it is to be paid;<br/>
<a id="pl.3.33"></a><var>3.33</var>(iv) benefits of the coverage;<br/>
<a id="pl.3.34"></a><var>3.34</var>(v) the terms for terminating or modifying coverage as set forth in the policy of <br/>
<a id="pl.3.35"></a><var>3.35</var>portable electronics insurance; and<br/>
<a id="pl.4.1"></a><var>4.1</var>(vi) any material exclusions, conditions, or other limitations of coverage including <br/>
<a id="pl.4.2"></a><var>4.2</var>whether portable electronics may be repaired or replaced with similar make and model <br/>
<a id="pl.4.3"></a><var>4.3</var>reconditioned or nonoriginal manufacturer parts or equipment;<br/>
<a id="pl.4.4"></a><var>4.4</var>(4) describe the process for filing a claim, including a description of any <br/>
<a id="pl.4.5"></a><var>4.5</var>requirements:<br/>
<a id="pl.4.6"></a><var>4.6</var>(i) to return portable electronics and the maximum fee applicable in the event the <br/>
<a id="pl.4.7"></a><var>4.7</var>customer fails to comply with any equipment return requirements; and<br/>
<a id="pl.4.8"></a><var>4.8</var>(ii) any proof of loss requirements; and<br/>
<a id="pl.4.9"></a><var>4.9</var>(5) state that the customer may cancel enrollment for coverage under a portable <br/>
<a id="pl.4.10"></a><var>4.10</var>electronics insurance policy at any time and any unearned premium will be refunded <br/>
<a id="pl.4.11"></a><var>4.11</var>on a pro rata basis.<br/>
<a id="pl.4.12"></a><var>4.12</var>(b) Portable electronics insurance may be offered on a month to month or other <br/>
<a id="pl.4.13"></a><var>4.13</var>periodic basis as a group or master commercial inland marine policy issued to a vendor of <br/>
<a id="pl.4.14"></a><var>4.14</var>portable electronics under which individual customers may elect to enroll for coverage.<br/>
<a id="pl.4.15"></a><var>4.15</var>(c) Notwithstanding any other provision of Minnesota law regarding the termination <br/>
<a id="pl.4.16"></a><var>4.16</var>or modification of coverage under a policy of insurance, the terms for the termination <br/>
<a id="pl.4.17"></a><var>4.17</var>or modification of coverage under a policy of portable electronics insurance issued in <br/>
<a id="pl.4.18"></a><var>4.18</var>compliance with this chapter shall be as set forth in the policy.<br/>
<a id="pl.4.19"></a><var>4.19</var>(d) Eligibility and underwriting standards for customers electing to enroll in <br/>
<a id="pl.4.20"></a><var>4.20</var>coverage shall be established for each portable electronics insurance program.<br/>
<a id="pl.4.21"></a><var>4.21</var>    Subd. 4. <b>Authority of vendors of portable electronics.</b> (a) The employees and <br/>
<a id="pl.4.22"></a><var>4.22</var>authorized representatives of vendors may sell or offer portable electronics insurance to <br/>
<a id="pl.4.23"></a><var>4.23</var>customers and shall not be subject to licensure as an insurance producer under this chapter <br/>
<a id="pl.4.24"></a><var>4.24</var>provided that:<br/>
<a id="pl.4.25"></a><var>4.25</var>(1) the vendor obtains a limited lines license to authorize its employees or authorized <br/>
<a id="pl.4.26"></a><var>4.26</var>representatives to sell or offer portable electronics insurance pursuant to this section;<br/>
<a id="pl.4.27"></a><var>4.27</var>(2) the insurer issuing the portable electronics insurance appoints a supervising <br/>
<a id="pl.4.28"></a><var>4.28</var>agency to supervise the administration of the program including development of a training <br/>
<a id="pl.4.29"></a><var>4.29</var>program for employees and authorized representatives of the vendors. The training <br/>
<a id="pl.4.30"></a><var>4.30</var>required by this subdivision shall comply with the following:<br/>
<a id="pl.4.31"></a><var>4.31</var>(i) the training shall be delivered to all employees and authorized representatives of <br/>
<a id="pl.4.32"></a><var>4.32</var>the vendors who sell or offer portable electronics insurance;<br/>
<a id="pl.4.33"></a><var>4.33</var>(ii) the training may be provided in electronic form. However, if conducted in <br/>
<a id="pl.4.34"></a><var>4.34</var>an electronic form, the supervising agency shall implement a program of in-person <br/>
<a id="pl.4.35"></a><var>4.35</var>training conducted by licensed employees of the supervising agency to supplement the <br/>
<a id="pl.4.36"></a><var>4.36</var>electronic training; and<br/>
<a id="pl.5.1"></a><var>5.1</var>(iii) each employee and authorized representative shall receive basic instruction <br/>
<a id="pl.5.2"></a><var>5.2</var>about the portable electronics insurance offered to customers and the disclosures required <br/>
<a id="pl.5.3"></a><var>5.3</var>under subdivision 3; and<br/>
<a id="pl.5.4"></a><var>5.4</var>(3) no employee or authorized representative of a vendor of portable electronics <br/>
<a id="pl.5.5"></a><var>5.5</var>shall advertise, represent, or otherwise hold himself or herself out as a nonlimited lines <br/>
<a id="pl.5.6"></a><var>5.6</var>licensed insurance producer.<br/>
<a id="pl.5.7"></a><var>5.7</var>(b) The charges for insurance coverage may be billed and collected by the vendor of <br/>
<a id="pl.5.8"></a><var>5.8</var>portable electronics. If billed and collected by the vendor, the charges shall be separately <br/>
<a id="pl.5.9"></a><var>5.9</var>itemized from the charges for the purchase or lease of portable electronics or services. <br/>
<a id="pl.5.10"></a><var>5.10</var>Vendors billing and collecting such charges shall not be required to maintain such funds <br/>
<a id="pl.5.11"></a><var>5.11</var>in a segregated account provided that the vendor is authorized by the insurer to hold <br/>
<a id="pl.5.12"></a><var>5.12</var>such funds in an alternative manner and remits such amounts to the supervising agency <br/>
<a id="pl.5.13"></a><var>5.13</var>within 60 days of receipt. All funds received by a vendor from a customer for the sale of <br/>
<a id="pl.5.14"></a><var>5.14</var>portable electronics insurance shall be considered funds held by the vendor in a fiduciary <br/>
<a id="pl.5.15"></a><var>5.15</var>capacity for the benefit of the insurer. Vendors may receive compensation for billing <br/>
<a id="pl.5.16"></a><var>5.16</var>and collection services.<br/>
<br/>
<a id="bill.0.4.0"></a><a id="pl.5.17"></a><var>5.17</var>    Sec. 4. Minnesota Statutes 2009 Supplement, section 60K.55, subdivision 2, is <br/>
<a id="pl.5.18"></a><var>5.18</var>amended to read:<br/>
<a id="pl.5.19"></a><var>5.19</var>    Subd. 2. <b>Licensing fees.</b> (a) In addition to fees provided for examinations and the <br/>
<a id="pl.5.20"></a><var>5.20</var>technology surcharge required under paragraph (d), each insurance producer licensed <br/>
<a id="pl.5.21"></a><var>5.21</var>under this chapter shall pay to the commissioner a fee of:<br/>
<a id="pl.5.22"></a><var>5.22</var>    (1) $50 for an initial life, accident and health, property, or casualty license issued to <br/>
<a id="pl.5.23"></a><var>5.23</var>an individual insurance producer, and a fee of $50 for each renewal;<br/>
<a id="pl.5.24"></a><var>5.24</var>    (2) $50 for an initial variable life and variable annuity license issued to an individual <br/>
<a id="pl.5.25"></a><var>5.25</var>insurance producer, and a fee of $50 for each renewal;<br/>
<a id="pl.5.26"></a><var>5.26</var>    (3) $50 for an initial personal lines license issued to an individual insurance <br/>
<a id="pl.5.27"></a><var>5.27</var>producer, and a fee of $50 for each renewal;<br/>
<a id="pl.5.28"></a><var>5.28</var>    (4) $50 for an initial limited lines license issued to an individual insurance producer, <br/>
<a id="pl.5.29"></a><var>5.29</var>and a fee of $50 for each renewal;<br/>
<a id="pl.5.30"></a><var>5.30</var>    (5) $200 for an initial license issued to a business entity, and a fee of $200 for each <br/>
<a id="pl.5.31"></a><var>5.31</var>renewal; and<br/>
<a id="pl.5.32"></a><var>5.32</var>    (6) $500 for an initial surplus lines license, and a fee of $500 for each renewal; <br/>
<a id="pl.5.33"></a><var>5.33</var>(7) $100 per location for the initial and renewal of a portable electronics insurance <br/>
<a id="pl.5.34"></a><var>5.34</var>limited lines license issued to a vendor, as defined in section 60K.381, subdivision 1, <br/>
<a id="pl.5.35"></a><var>5.35</var>paragraph (g), engaged in portable electronics transactions at ten or fewer locations in <br/>
<a id="pl.6.1"></a><var>6.1</var>this state as set forth in its application and any subsequent notice under section 60K.381, <br/>
<a id="pl.6.2"></a><var>6.2</var>subdivision 2, paragraph (b); and<br/>
<a id="pl.6.3"></a><var>6.3</var>(8) $6,500 for the initial and renewal of a portable electronics insurance limited lines <br/>
<a id="pl.6.4"></a><var>6.4</var>license issued to a vendor, as defined in section 60K.381, subdivision 1, paragraph (g), <br/>
<a id="pl.6.5"></a><var>6.5</var>engaged in portable electronics transactions at more than ten locations in this state as set <br/>
<a id="pl.6.6"></a><var>6.6</var>forth in its application and any subsequent notice under section 60K.381, subdivision 2, <br/>
<a id="pl.6.7"></a><var>6.7</var>paragraph (b).<br/>
<a id="pl.6.8"></a><var>6.8</var>    (b) Initial licenses issued to a business entity under this chapter are valid for a period <br/>
<a id="pl.6.9"></a><var>6.9</var>not to exceed 24 months and expire on October 31 of the renewal year assigned by the <br/>
<a id="pl.6.10"></a><var>6.10</var>commissioner. Initial licenses issued to an individual insurance producer under this <br/>
<a id="pl.6.11"></a><var>6.11</var>chapter before August 1, 2010, are valid for a period not to exceed 24 months and expire <br/>
<a id="pl.6.12"></a><var>6.12</var>on October 31 of the renewal year assigned by the commissioner. Each individual license <br/>
<a id="pl.6.13"></a><var>6.13</var>initially issued or renewed on or after August 1, 2010, expires on the last day of the birth <br/>
<a id="pl.6.14"></a><var>6.14</var>month of the producer in the year that will result in the term of the license being at least <br/>
<a id="pl.6.15"></a><var>6.15</var>12 months, but no more than 24 months. Beginning with the first license expiration on <br/>
<a id="pl.6.16"></a><var>6.16</var>the last day of the birth month of an individual producer as set forth in this paragraph, all <br/>
<a id="pl.6.17"></a><var>6.17</var>such licenses must after this date expire biennially on the last day of the birth month of the <br/>
<a id="pl.6.18"></a><var>6.18</var>individual producer that is two years subsequent to the preceding expiration date. Each <br/>
<a id="pl.6.19"></a><var>6.19</var>renewal insurance producer license is valid for a period of 24 months. <br/>
<a id="pl.6.20"></a><var>6.20</var>    (c) All fees are nonreturnable, except that an overpayment of any fee may be <br/>
<a id="pl.6.21"></a><var>6.21</var>refunded upon proper application.<br/>
<a id="pl.6.22"></a><var>6.22</var>    (d) In addition to the fees required under paragraph (a), individual insurance <br/>
<a id="pl.6.23"></a><var>6.23</var>producers shall pay, for each initial license and renewal, a technology surcharge of up to <br/>
<a id="pl.6.24"></a><var>6.24</var>$40 under section 
         <statute_ref>45.24</statute_ref>, unless the commissioner has adjusted the surcharge as permitted <br/>
<a id="pl.6.25"></a><var>6.25</var>under that section.<br/>
<br/>
<a id="bill.0.5.0"></a><a id="pl.6.26"></a><var>6.26</var>    Sec. 5. <b>APPROPRIATION.</b><br/>
<a id="pl.6.27"></a><var>6.27</var>$39,000 in fiscal year 2011 is appropriated from the general fund to the commissioner <br/>
<a id="pl.6.28"></a><var>6.28</var>of commerce for implementing this act. The base appropriation for this program is <br/>
<a id="pl.6.29"></a><var>6.29</var>$40,000 in fiscal year 2012 and $41,000 in fiscal year 2013.<br/>