1.1                          A bill for an act 
  1.2             relating to insurance; prohibiting zip code rating in 
  1.3             homeowner's and automobile insurance; amending 
  1.4             Minnesota Statutes 1994, section 72A.20, subdivisions 
  1.5             13 and 23. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 1994, section 72A.20, 
  1.8   subdivision 13, is amended to read: 
  1.9      Subd. 13.  [REFUSAL TO RENEW.] Refusing to renew, declining 
  1.10  to offer or write, or charging differential rates for an 
  1.11  equivalent amount of homeowner's insurance coverage, as defined 
  1.12  by section 65A.27, for property located in a town or statutory 
  1.13  or home rule charter city, in which the insurer offers to sell 
  1.14  or writes homeowner's insurance, solely because:  
  1.15     (a) of the geographic area in which the property is 
  1.16  located; 
  1.17     (b) of the age of the primary structure sought to be 
  1.18  insured; 
  1.19     (c) the insured or prospective insured was denied coverage 
  1.20  of the property by another insurer, whether by cancellation, 
  1.21  nonrenewal or declination to offer coverage, for a reason other 
  1.22  than those specified in section 65A.01, subdivision 3a, clauses 
  1.23  (a) to (e); or 
  1.24     (d) the property of the insured or prospective insured has 
  1.25  been insured under the Minnesota FAIR plan act, shall constitute 
  2.1   an unfair method of competition and an unfair and deceptive act 
  2.2   or practice.  
  2.3      This subdivision prohibits an insurer from filing or 
  2.4   charging different rates for different zip code areas within the 
  2.5   same town or statutory or home rule charter city. 
  2.6      This subdivision shall not prohibit the insurer from 
  2.7   applying underwriting or rating standards which the insurer 
  2.8   applies generally in all other locations in the state and which 
  2.9   are not specifically prohibited by clauses (a) to (d).  Such 
  2.10  underwriting or rating standards shall specifically include but 
  2.11  not be limited to standards based upon the proximity of the 
  2.12  insured property to an extraordinary hazard or based upon the 
  2.13  quality or availability of fire protection services or based 
  2.14  upon the density or concentration of the insurer's risks.  
  2.15  Clause (b) shall not prohibit the use of rating standards based 
  2.16  upon the age of the insured structure's plumbing, electrical, 
  2.17  heating or cooling system or other part of the structure, the 
  2.18  age of which affects the risk of loss.  Any insurer's failure to 
  2.19  comply with section 65A.29, subdivisions 2 to 4, either (1) by 
  2.20  failing to give an insured or applicant the required notice or 
  2.21  statement or (2) by failing to state specifically a bona fide 
  2.22  underwriting or other reason for the refusal to write shall 
  2.23  create a presumption that the insurer has violated this 
  2.24  subdivision.  
  2.25     Sec. 2.  Minnesota Statutes 1994, section 72A.20, 
  2.26  subdivision 23, is amended to read: 
  2.27     Subd. 23.  [DISCRIMINATION IN AUTOMOBILE INSURANCE 
  2.28  POLICIES.] (a) No insurer that offers an automobile insurance 
  2.29  policy in this state shall: 
  2.30     (1) use the employment status of the applicant as an 
  2.31  underwriting standard or guideline; or 
  2.32     (2) deny coverage to a policyholder for the same reason. 
  2.33     (b) No insurer that offers an automobile insurance policy 
  2.34  in this state shall: 
  2.35     (1) use the applicant's status as a tenant, as the term is 
  2.36  defined in section 566.18, subdivision 2, as an underwriting 
  3.1   standard or guideline; or 
  3.2      (2) deny coverage to a policyholder for the same reason; or 
  3.3      (3) make any discrimination in offering or establishing 
  3.4   rates, premiums, dividends, or benefits of any kind, or by way 
  3.5   of rebate, for the same reason.  
  3.6      (c) No insurer that offers an automobile insurance policy 
  3.7   in this state shall: 
  3.8      (1) use the failure of the applicant to have an automobile 
  3.9   policy in force during any period of time before the application 
  3.10  is made as an underwriting standard or guideline; or 
  3.11     (2) deny coverage to a policyholder for the same reason. 
  3.12     This provision does not apply if the applicant was required 
  3.13  by law to maintain automobile insurance coverage and failed to 
  3.14  do so. 
  3.15     An insurer may require reasonable proof that the applicant 
  3.16  did not fail to maintain this coverage.  The insurer is not 
  3.17  required to accept the mere lack of a conviction or citation for 
  3.18  failure to maintain this coverage as proof of failure to 
  3.19  maintain coverage. 
  3.20     (d) No insurer that offers an automobile insurance policy 
  3.21  in this state shall use an applicant's prior claims for benefits 
  3.22  paid under section 65B.44 as an underwriting standard or 
  3.23  guideline if the applicant was 50 percent or less negligent in 
  3.24  the accident or accidents causing the claims. 
  3.25     (e) No insurer that offers an automobile insurance policy 
  3.26  in this state shall file or charge different rates for different 
  3.27  zip code areas within the same town or statutory or home rule 
  3.28  charter city.