HB 2566 - This act modifies provisions relating to travel insurance.
The act specifies that the act shall not apply to cancellation fee waivers or travel assistance services, as defined in the act. Under the act, the Director of the Department of Commerce and Insurance may issue a limited lines travel insurance producer license to a person or business entity that has filed an application with the Director. A limited lines producer may sell, solicit, or negotiate travel insurance through a licensed insurer. (Section 375.159.2). The existing grounds for license suspension or revocation by the Director shall apply to limited lines travel insurance producers and travel retailers, as defined in the act. (Section 375.159.3(2)(b)). The act specifies that certain information travel retailers are currently required to provide to customers shall have been approved by the travel insurer. (Section 375.159.3(3)).
Persons licensed to produce major lines of insurance may produce travel insurance as well. A property and casualty insurance producer is not required to be appointed by an insurer in order to produce travel insurance. (Section 375.159.3(8)).
Under the act, travel insurance will be subject to taxation of premiums as provided by law, with certain disclosures to be made as specified in the act. (Section 375.159.4).
Travel protection plans, as defined in the act, may be offered if the protection plan makes certain disclosures and provides information and materials described in the act. (Section 375.159.5).
Except as otherwise provided in the act, persons offering travel insurance to residents of this state shall be subject to the Unfair Trade Practices Act. If there is any conflict between the act and the other insurance laws of the state regarding travel insurance, the provisions of the act shall control. (Section 375.159.6(1)). It shall be an unfair trade practice to offer or sell a policy of travel insurance that could never result in payment to the insured. (Section 375.159.6(2)).
The act requires documents provided to consumers prior to purchasing travel insurance to be accurate, and requires disclosure of and an opportunity to learn more about preexisting condition exclusions. The act specifies that certain documents required by law shall be provided to the purchaser as soon as practicable following the purchase of a travel protection plan, and provides for minimum periods in which policies can be cancelled for a full refund. (Section 375.159.6(3)(a)-(c)). The act requires disclosure of whether the travel insurance is primary or secondary coverage, and specifies that marketing the policies directly to consumers through an aggregator site, as defined in the act, shall not be an unfair trade practice if an accurate summary of the coverage is provided on the web page and the consumer has access to the full policy through electronic means. (Section 375.159.6(3)(d)-(e)).
The act prohibits the use of selling travel insurance by means of a negative option or "opt-out" that would require the consumer to take action to decline coverage, such as unchecking a box on an electronic form, when purchasing a trip. (Section 375.159.6(4)). It shall be an unfair trade practice to market blanket travel insurance coverage, as defined in the act, as free. (Section 375.159.6(5)). Where a consumer's destination jurisdiction requires travel insurance, it shall not be an unfair trade practice to require purchase of coverage through the travel retailer, or agreement to obtain and provide proof of coverage from another source, prior to departure. (Section 375.159.6(6)).
No person shall represent himself or herself as a travel administrator, as defined in the act, for issuance of travel insurance unless the person holds one of the types of license described in the act. Insurers are responsible for the acts of travel administrators administering their policies, and are responsible for ensuring relevant books and records are maintained to be provided to the Director upon request. (Section 375.159.7(1)).
Travel insurance shall be classified and filed for purposes of forms and rates under an inland marine line of insurance, except as otherwise provided in the act. Eligibility and underwriting standards for travel insurance may be developed, provided they also meet the state's underwriting standards for inland marine insurance. (Section 375.159.8).
This act is substantially similar to SB 1116 (2022), provisions in the truly agreed to and finally passed CCS/SS/SCS/HCS/HB 2168 (2022), SB 1116 (2022), provisions in SS/SB 742 (2022), and provisions in HCS/SS/SCS/SB 783 (2022).
ERIC VANDER WEERD