2nd Engrossment - 87th Legislature (2011 - 2012) Posted on 03/06/2012 02:47pm
A bill for an act
relating to commerce; regulating continuing education and prelicensing
requirements, insurance coverages, certain disclosures, nonadmitted insurers,
insolvencies, real estate closing agents, adjusters, and appraisers;amending
Minnesota Statutes 2010, sections 45.011, subdivision 1; 45.25, by adding
subdivisions; 45.30, subdivision 7, by adding a subdivision; 45.35; 60A.06,
subdivision 3; 60A.19, subdivision 8; 60A.196; 60A.198; 60A.199, subdivision
1; 60A.201; 60A.202; 60A.203; 60A.204, subdivision 2; 60A.205, subdivisions
1, 2; 60A.206, subdivisions 1, 3; 60A.207; 60A.208; 60A.2085, subdivisions 1,
3, 7, 8; 60A.2086, subdivisions 1, 2; 60A.209, subdivision 1; 60K.56, subdivision
6; 62A.095, subdivision 1; 62A.318, subdivision 17; 62E.14, subdivision 3, by
adding a subdivision; 62J.81, subdivision 1; 62L.03, subdivision 3; 72A.20,
subdivision 24; 72B.041, subdivision 5; 79A.06, subdivision 5; 79A.24, by
adding subdivisions; 82.641, subdivision 1; 82B.11, subdivision 6; 82B.13, by
adding a subdivision; 82B.14; 82C.08, subdivision 2; proposing coding for new
law in Minnesota Statutes, chapters 45; 72B.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Minnesota Statutes 2010, section 45.011, subdivision 1, is amended to read:
As used in chapters 45 to 83, 155A, 332,
332A, 332B, 345, and 359, and sections 123A.21, subdivision 7, paragraph (a), clause
(23); 123A.25; 325D.30 to 325D.42; 326B.802 to 326B.885; 386.61 to 386.78; 471.617;
and 471.982, unless the context indicates otherwise, the terms defined in this section
have the meanings given them.
Minnesota Statutes 2010, section 45.25, is amended by adding a subdivision to
Minnesota Statutes 2010, section 45.25, is amended by adding a subdivision to
Minnesota Statutes 2010, section 45.25, is amended by adding a subdivision to
Minnesota Statutes 2010, section 45.30, is amended by adding a subdivision to
Minnesota Statutes 2010, section 45.30, subdivision 7, is amended to read:
All course offerings must be open to any
interested individuals. Access may be restricted by the education provider based on class
size only, except that access to a course offering sponsored by, offered by, or affiliated with
an insurance company or agency may be restricted to agents of the company or agency.
Courses must not be approved if attendance is restricted to any particular group of people,
except for company-sponsored courses allowed by statute.
Minnesota Statutes 2010, section 45.35, is amended to read:
Each course of study, except self-study courses, must be conducted in a classroom or
other facility that is adequate to comfortably accommodate the faculty and the number
of students enrolled. The education provider may limit the number of students enrolled
in a course. Approved courses must not be held on the premises of a company doing
business in the regulated area, except for company-sponsored courses allowed by statute.
Minnesota Statutes 2010, section 60A.06, subdivision 3, is amended to read:
(a) Unless specifically authorized by
subdivision 1, clause (4), it is unlawful to combine in one policy coverage permitted by
subdivision 1, clauses (4) and (5)(a). This subdivision does not prohibit the simultaneous
sale of these products, but the sale must involve two separate and distinct policies.
(b) This subdivision does not apply to group policies.
(c) This subdivision does not apply to policies permitted by subdivision 1, clause
(4), that contain benefits providing acceleration of life, endowment, or annuity benefits
in advance of the time they would otherwise be payable, or to long-term care policies as
defined in section 62A.46, subdivision 2, or chapter 62S.
Minnesota Statutes 2010, section 60A.19, subdivision 8, is amended to read:
Any person, firm, or
desiring to obtain insurance upon any property, interests, or risks of any nature must
other than life insurance in this state in companies not authorized to do business in the
agree to file with the commissioner of revenue all returns required under chapter 297I and
pay to the commissioner of revenue any amounts required to be paid under chapter 297I.
Upon that agreement, the commissioner of commerce shall issue a license, good for one
year. Insurance procured under the license is valid and the provisions of the policies are
considered to be in accordance, and construed as if identical in effect, with the standard
policy prescribed by the laws of this state. The insurers may enter the state to perform
any act necessary or proper in the conduct of the business.
Minnesota Statutes 2010, section 60A.196, is amended to read:
(b) "Eligible surplus lines insurer" means an insurer recognized as eligible to write
insurance business under sections 60A.195 to 60A.209 but not licensed by any other
Minnesota law to transact the business of insurance.
(c) "Ineligible surplus lines insurer" means an insurer not recognized as an eligible
surplus lines insurer pursuant to sections 60A.195 to 60A.209 and not licensed by any
other Minnesota law to transact the business of insurance. "Ineligible surplus lines
insurer" includes a risk retention group as defined under the Liability Risk Retention
Act, Public Law 99-563.
(e) "Association" means an association registered under section 60A.208.
(f) "Alien insurer" means any insurer which is incorporated or otherwise organized
outside of the United States.
(g) "Insurance laws" means chapters 60 to 79 inclusive.
(h) "Stamping" means electronically assigning a unique identifying number that is
specific to a submitted policy, contract, or insurance document.
Minnesota Statutes 2010, section 60A.198, is amended to read:
A person, as defined in section 60A.02,
subdivision 7, shall not act in any other manner as an agent or broker in the transaction of
surplus lines insurance unless licensed under sections 60A.195 to 60A.209.
A surplus lines license is not required for a licensed agent who assists in the placement
surplus lines insurance with a surplus lines licensee pursuant to
sections 60A.195 to 60A.209.
A person shall not offer, solicit,
make a quotation on, sell, or issue a policy of insurance, binder, or any other evidence
of insurance with
an eligible or ineligible surplus lines insurer, except in
compliance with sections 60A.195 to 60A.209.
A person licensed as an agent in this
state pursuant to other law may obtain a surplus lines license by doing the following:
(b) maintaining an agent's license in this state;
(c) registering with the association created pursuant to section 60A.2085;
(d) agreeing to file with the commissioner of revenue all returns required by chapter
297I and paying to the commissioner of revenue all amounts required under chapter 297I;
(f) paying a fee as prescribed by section 60K.55.
A surplus lines
licensee may do
any or all of the following:
(a) place insurance on risks in this state with eligible surplus lines insurers;
(b) place insurance on risks in this state with ineligible surplus lines insurers in strict
compliance with section 60A.209. If the insurance is provided through the participation of
surplus lines insurers and the licensee has reason to believe
that a substantial portion of the insurance would be assumed by eligible surplus lines
insurers, then with respect to the ineligible surplus lines insurers, the insured or the
insured's representative shall be informed as provided in section 60A.209, subdivision 1,
clause (a); or
Before placement of insurance with an eligible surplus
lines insurer, a surplus lines
licensee shall inform an insured or the insured's
representative that coverage may be placed in conformance with sections 60A.195
to 60A.209 with an insurer not licensed in this state and that payment of loss is not
guaranteed in the event of insolvency of the eligible surplus lines insurer.
Minnesota Statutes 2010, section 60A.199, subdivision 1, is amended to read:
If the commissioner considers
it necessary, the commissioner may examine the books and records of a surplus lines
licensee to determine whether the licensee is conducting business
in accordance with sections 60A.195 to 60A.209. For the purposes of facilitating
licensee shall allow the commissioner free access at reasonable
times to all of the
licensee's books and records relating to the transactions to
which sections 60A.195 to 60A.209 apply. If an examination is conducted, the cost of the
examination shall be paid by the surplus line agent or agency.
Minnesota Statutes 2010, section 60A.201, is amended to read:
Insurance shall not be placed by the surplus lines
licensee with an eligible or ineligible surplus lines insurer when
coverage is available from a licensed insurer.
There shall be a rebuttable
presumption that the following coverages are available from a licensed insurer:
(a) all mandatory automobile insurance coverages required by chapter 65B;
(b) private passenger automobile physical damage coverage;
(c) homeowners and property insurance on owner-occupied dwellings whose value
is less than $500,000. This figure shall be changed annually by the commissioner by the
same percentage as the Consumer Price Index for the Minneapolis-St. Paul Metropolitan
Area is changed;
(d) any coverage readily available from three or more licensed insurers unless the
licensed insurers quote a premium and terms not competitive with a premium and terms
quoted by an eligible surplus lines insurer; and
(e) workers' compensation insurance, except excess workers' compensation insurance
which is not available from the Workers' Compensation Reinsurance Association.
There shall be a
rebuttable presumption that the following coverages are unavailable from a licensed
(a) coverages where one portion of the risk is acceptable to licensed insurers but
another portion of the same risk is not acceptable. The entire coverage may be placed with
eligible surplus lines insurers if it can be shown that the eligible surplus lines insurer will
accept the entire coverage but not the rejected portion alone; and
(b) any coverage that the
licensee is unable to procure after diligent search
among licensed insurers.
Minnesota Statutes 2010, section 60A.202, is amended to read:
Only a surplus lines
licensee shall issue evidence
of placement of insurance with
an eligible or ineligible surplus lines insurer.
shall, within seven working days after the date on which the risk was bound or the insured
or applicant was advised that coverage has been or will be obtained, deliver to the insured
or the insured's representative a policy, a written binder, a certificate or other written
evidence of insurance placed with
an eligible or ineligible surplus lines
The written communication
showing that insurance has been obtained shall identify all known
surplus lines insurers directly assuming any risk of loss. If there is more than one surplus lines insurer, any document issued or certified by the licensee
pursuant to subdivision 2 shall specify, to the extent known by the
whether the obligation is joint or several, and if the obligation is several, the proportion of
the obligation assumed by each insurer.
Minnesota Statutes 2010, section 60A.203, is amended to read:
Each surplus lines
licensee shall keep a separate account of each transaction
entered into pursuant to sections 60A.195 to 60A.209. Evidence of these transactions shall
be documented in the form and manner designated by the commissioner and retained by
licensee for a minimum of five years. The forms must be readily available
for review and audit by the commissioner.
Minnesota Statutes 2010, section 60A.204, subdivision 2, is amended to read:
A surplus lines
may charge a fee and commission, in addition to the premium, that is not excessive or
licensee shall maintain complete documentation of all fees
and commissions charged.
Minnesota Statutes 2010, section 60A.205, subdivision 1, is amended to read:
A surplus lines
licensee may be compensated
by an eligible surplus lines insurer and the
licensee may compensate a licensed
agent in this state for obtaining
surplus lines insurance business. A licensed
agent authorized by the
licensee may collect a premium on behalf of the licensee, and as between the insured and the licensee, the licensee shall be
considered to have received the premium if the premium payment has been made to
Minnesota Statutes 2010, section 60A.205, subdivision 2, is amended to read:
If an eligible surplus lines insurer has assumed a
risk, and if the premium for that risk has been received by the
licensee who placed
the insurance, then as between the insurer and the insured, the insurer shall be considered
to have received the premium due to it for the coverage and shall be liable to the insured
for any loss covered by the insurance and for the unearned premium upon cancellation of
the insurance, regardless of whether the
licensee is indebted to the insurer.
Minnesota Statutes 2010, section 60A.206, subdivision 1, is amended to read:
A surplus lines
licensee shall place surplus lines insurance only with insurers
which are in a stable and unimpaired financial condition. An insurer recognized by the
commissioner as an eligible surplus lines insurer pursuant to subdivision 2 shall be
considered to meet the requirements of this subdivision. Recognition as an eligible surplus
lines insurer shall be conditioned upon the insurers continued compliance with sections
60A.195 to 60A.209.
Minnesota Statutes 2010, section 60A.206, subdivision 3, is amended to read:
(a) The commissioner shall recognize
the insurer as an eligible surplus lines insurer when satisfied that the insurer is in a stable,
unimpaired financial condition and that the insurer is qualified to provide coverage in
compliance with sections 60A.195 to 60A.209. If filed with full supporting documentation
before July 1 of any year, applications submitted under subdivision 2 shall be acted upon
by the commissioner before December 31 of the year of submission.
(b) The commissioner shall not authorize
an insurer as an eligible surplus
lines insurer unless the insurer
continuously maintains capital and surplus of at least
$3,000,000 and transaction of business by the insurer is not hazardous, financially or
otherwise, to its policyholders, its creditors, or the public. Each alien surplus lines
insurer shall have current financial data filed with the National Association of Insurance
Commissioners Nonadmitted Insurers Information Office.
(c) Eligible surplus lines insurers domiciled within the United States shall file an
annual statement and an annual financial audit, under the terms and conditions of section
60A.13, subdivisions 1, 3a, and 6, and are subject to the penalties of section 72A.061,
and are subject to section 60A.03, subdivision 5, in regard to those requirements. The
commissioner also has the powers provided in section 60A.13, subdivision 2, in regard
to eligible surplus lines insurers.
(d) Eligible surplus lines insurers domiciled outside the United States shall file
an annual statement on the standard nonadmitted insurers information office financial
reporting format as prescribed by the National Association of Insurance Commissioners
and an annual financial audit performed by an independent accounting firm.
Minnesota Statutes 2010, section 60A.207, is amended to read:
Each policy, cover note, or instrument evidencing
insurance from an eligible surplus lines insurer which is delivered to an insured or a
representative of an insured shall have printed, typed, or stamped upon its face in not less
than 10 point type, the following notice: "THIS INSURANCE IS ISSUED PURSUANT
TO THE MINNESOTA SURPLUS LINES INSURANCE ACT. THE INSURER IS AN
ELIGIBLE SURPLUS LINES INSURER BUT IS NOT OTHERWISE LICENSED BY
THE STATE OF MINNESOTA. IN CASE OF INSOLVENCY, PAYMENT OF CLAIMS
IS NOT GUARANTEED." This notice shall not be covered or concealed in any manner.
Minnesota Statutes 2010, section 60A.208, is amended to read:
licensees may associate and the commissioner may register the association for one or more
of the following purposes:
(a) advising the commissioner as to the availability of
surplus lines coverage and market practices and standards for surplus lines
(b) collecting and furnishing records and statistics; or
(a) Each association shall file with the commissioner
for approval all of the following:
(1) a copy of the association's constitution and articles of agreement or association,
or the association's certificate of incorporation and bylaws and any rules governing the
association's activities; and
(2) an agreement that, as a condition of continued registration under subdivision 1,
the commissioner may examine the association.
(b) Each association shall file with the commissioner and keep current all of the
(1) a list of members; and
(2) the name and address of a resident of this state upon whom notices or orders of
the commissioner or process issued by the commissioner may be served.
may refuse to register, or may suspend or revoke the registration of an association for any
of the following reasons:
(b) the association fails to maintain and enforce rules which will assure that
members of the association and persons associated with those members comply with
sections 60A.195 to 60A.209, other applicable chapters of the insurance laws and rules
promulgated under either;
(c) the rules of the association do not assure a fair representation of its members in
the selection of directors and in the administration of its affairs;
(d) the rules of the association do not provide for an equitable allocation of
reasonable dues, fees, and other charges among members;
(e) the rules of the association impose a burden on competition; or
An association shall deny
membership to any person who is not a
Each association shall annually file a
certified audited financial statement.
An association may
submit reports and make recommendations to the commissioner regarding the financial
condition of any eligible surplus lines insurer. These reports and recommendations shall
not be considered to be public information. There shall not be liability on the part of, or a
cause of action of any nature shall not arise against, eligible surplus lines insurers, the
association or its agents or employees, the directors, or the commissioner or authorized
representatives of the commissioner, for statements made by them in any reports or
recommendations made under this subdivision.
(a) Upon request from the association, the
commissioner may approve the levy of an assessment of not more than one-half of one
percent of premiums charged pursuant to sections 60A.195 to 60A.209 for operation
of the association to the extent that the operation relieves the commissioner of duties
otherwise required of the commissioner pursuant to sections 60A.195 to 60A.209. Any
assessment so approved may be subtracted from the premium tax owed by the
licensee under chapter 297I.
(b) The association may revoke the membership and the commissioner may revoke
the license in this state, of any
licensee who fails to pay an assessment when due, if
the assessment has been approved by the commissioner.
Minnesota Statutes 2010, section 60A.2085, subdivision 1, is amended to read:
There is hereby created a nonprofit
association to be known as the Surplus Lines Association of Minnesota. The association
is not a state agency for purposes of chapter 16A, 16B, 16C, or 43A. All surplus lines
licensees are members of this association. Section 60A.208 does not apply to
the association created pursuant to the provisions of this section. The association shall
perform its functions under the plan of operation established under subdivision 3 and must
exercise its powers through a board of directors established under subdivision 2 as set
forth in the plan of operation. The association shall be authorized and have the duty to:
(1) receive, record, and stamp all
surplus lines insurance documents
that surplus lines
licensees are required to file with the association;
(2) prepare and deliver monthly to the commissioners of revenue and commerce a
report regarding surplus lines business. The report must include a list of all the business
procured during the preceding month, in the form the commissioners prescribe;
(3) educate its members regarding the surplus lines law of this state including
insurance tax responsibilities and the rules and regulations of the commissioners of
revenue and commerce relative to
surplus lines insurance;
(4) communicate with organizations of agents, brokers, and admitted insurers with
respect to the proper use of the surplus lines market;
(5) employ and retain persons necessary to carry out the duties of the association;
(6) borrow money necessary to effect the purposes of the association and grant a
security interest or mortgage in its assets, including the stamping fees charged pursuant to
subdivision 7 in order to secure the repayment of any such borrowed money;
(7) enter contracts necessary to effect the purposes of the association;
(8) provide other services to its members that are incidental or related to the
purposes of the association;
(9) form and organize itself as a nonprofit corporation under chapter 317A, with the
powers set forth in section 317A.161 that are not otherwise limited by this section or in
its articles, bylaws, or plan of operation;
(10) file such applications and take such other action as necessary to establish and
maintain the association as tax exempt pursuant to the federal income tax code;
(11) recommend to the commissioner of commerce revisions to Minnesota law
relating to the regulation of
surplus lines insurance in order to improve the
efficiency and effectiveness of that regulation; and
(12) take other actions reasonably required to implement the provisions of this
Minnesota Statutes 2010, section 60A.2085, subdivision 3, is amended to read:
(a) The plan of operation shall provide for the
formation, operation, and governance of the association as a nonprofit corporation under
chapter 317A. The plan of operation must provide for the election of a board of directors
by the members of the association. The board of directors shall elect officers as provided
for in the plan of operation. The plan of operation shall establish the manner of voting and
may weigh each member's vote to reflect the annual
surplus lines insurance
premium written by the member. Members employed by the same or affiliated employers
may consolidate their premiums written and delegate an individual officer or partner
to represent the member in the exercise of association affairs, including service on the
board of directors.
(b) The plan of operation shall provide for an independent audit once each year of all
the books and records of the association and a report of such independent audit shall be
made to the board of directors, the commissioner of revenue, and the commissioner of
commerce, with a copy made available to each member to review at the association office.
(c) The plan of operation and any amendments to the plan of operation shall be
submitted to the commissioner and shall be effective upon approval in writing by the
commissioner. The association and all members shall comply with the plan of operation or
any amendments to it. Failure to comply with the plan of operation or any amendments
shall constitute a violation for which the commissioner may issue an order requiring
discontinuance of the violation.
(d) If the interim board of directors fails to submit a suitable plan of operation
within 60 days following the creation of the interim board, or if at any time thereafter the
association fails to submit required amendments to the plan, the commissioner may submit
to the association a plan of operation or amendments to the plan, which the association
must follow. The plan of operation or amendments submitted by the commissioner shall
continue in force until amended by the commissioner or superseded by a plan of operation
or amendment submitted by the association and approved by the commissioner. A plan
of operation or an amendment submitted by the commissioner constitutes an order of
Minnesota Statutes 2010, section 60A.2085, subdivision 7, is amended to read:
The services performed by the association shall be
funded by a stamping fee assessed for each premium-bearing document submitted to
the association. The stamping fee shall be established by the board of directors of the
association from time to time. The stamping fee shall be paid by the insured to the surplus
licensee and remitted to the association by the surplus lines licensee in
the manner established by the association.
Minnesota Statutes 2010, section 60A.2085, subdivision 8, is amended to read:
Unless otherwise classified by statute, a temporary
classification under section 13.06, or federal law, information obtained by the
commissioner from the association is public, except that any data identifying insureds or
the Social Security number of a
licensee or any information derived therefrom is
private data on individuals or nonpublic data as defined in section 13.02, subdivisions
9 and 12.
Minnesota Statutes 2010, section 60A.2086, subdivision 1, is amended to read:
(a) A surplus lines
licensee shall submit every insurance
policy or contract issued under the
licensee's license to the Surplus Lines
Association of Minnesota for recording and stamping. The submission and stamping must
be effected through electronic means. The submission must include:
(1) the name of the insured;
(2) a description and location of the insured property or risk;
(3) the amount insured;
(4) the gross premiums charged or returned;
(5) the name of the
surplus lines insurer from whom coverage has
(6) the kind or kinds of insurance procured; and
(7) the amount of premium subject to tax.
(b) The submission of insurance policies or contracts to the Surplus Lines
Association of Minnesota constitutes a certification by the surplus lines
by the insurance producer who presented the risk to the surplus lines
placement as a surplus lines risk, that the insurance policies or contracts were procured in
accordance with sections 60A.195 to 60A.209.
Minnesota Statutes 2010, section 60A.2086, subdivision 2, is amended to read:
(a) It shall be unlawful for an insurance
agent, broker, or surplus lines
licensee to deliver in this state any surplus lines insurance policy or contract unless the insurance document is stamped by the
licensee's failure to comply with the requirements of
this subdivision shall not affect the validity of the coverage.
(b) Any insurance agent
, broker, or surplus lines licensee who delivers in this
state any insurance policy or contract that has not been stamped by the association shall be
subject to a penalty payable to the commissioner as follows:
(1) $50 for delivery of the first unstamped policy;
(2) $250 for delivery of a second unstamped policy; and
(3) $1,000 per policy for delivery of any additional unstamped policies.
Minnesota Statutes 2010, section 60A.209, subdivision 1, is amended to read:
A resident of this state may obtain
insurance from an ineligible surplus lines insurer in this state through a surplus lines
licensee. The licensee shall first attempt to place the insurance with a
licensed insurer, or if that is not possible, with an eligible surplus lines insurer. If coverage
is not obtainable from a licensed insurer or an eligible surplus lines insurer, the
licensee shall certify to the commissioner, on a form prescribed by the commissioner, that
these attempts were made. Upon obtaining coverage from an ineligible surplus lines
(a) Have printed, typed, or stamped in red ink upon the face of the policy in
not less than 10-point type the following notice: "THIS INSURANCE IS ISSUED
PURSUANT TO THE MINNESOTA SURPLUS LINES INSURANCE ACT. THIS
INSURANCE IS PLACED WITH AN INSURER THAT IS NOT LICENSED BY THE
STATE NOR RECOGNIZED BY THE COMMISSIONER OF COMMERCE AS AN
ELIGIBLE SURPLUS LINES INSURER. IN CASE OF ANY DISPUTE RELATIVE
TO THE TERMS OR CONDITIONS OF THE POLICY OR THE PRACTICES OF
THE INSURER, THE COMMISSIONER OF COMMERCE WILL NOT BE ABLE TO
ASSIST IN THE DISPUTE. IN CASE OF INSOLVENCY, PAYMENT OF CLAIMS IS
NOT GUARANTEED." The notice may not be covered or concealed in any manner; and
(b) Collect from the insured appropriate premium taxes, as provided under chapter
297I, and report the transaction to the commissioner of revenue on a form prescribed by
the commissioner. If the insured fails to pay the taxes when due, the insured shall be
subject to a civil fine of not more than $3,000, plus accrued interest from the inception of
Minnesota Statutes 2010, section 60K.56, subdivision 6, is amended to read:
Each person subject to this section
shall complete a minimum of 24 credit hours of courses accredited by the commissioner
during each licensing period. No more than one-half of the credit hours per licensing
period required under this section may be credited to a person for attending courses either
sponsored by, offered by, or affiliated with an insurance company or its agents. For the
purposes of this subdivision, a course provided by a bona fide insurance trade association
is not considered to be sponsored by, offered by, or affiliated with an insurance company
or its agents regardless of the location of the course offering. A licensee must obtain three
hours of the credit hours per licensing period from a class or classes in the area of ethics.
Courses sponsored by, offered by, or affiliated with an insurance company or agent may
restrict its students to agents of the company or agency.
Minnesota Statutes 2010, section 62A.095, subdivision 1, is amended to read:
No health plan shall be offered, sold,
or issued to a resident of this state, or to cover a resident of this state, unless the health
plan complies with subdivision 2.
(b) Health plans providing benefits under health care programs administered by the
commissioner of human services are not subject to the limits described in subdivision
2 but are subject to the right of subrogation provisions under section 256B.37 and the
lien provisions under section 256.015; 256B.042; 256D.03, subdivision 8; or 256L.03,
For purposes of this section, "health plan" includes coverage that is excluded under
section 62A.011, subdivision 3, clauses (4), (7), and (10).
Minnesota Statutes 2010, section 62A.318, subdivision 17, is amended to read:
Medicare select policies and certificates must
be either a basic plan or an extended basic plan. Before a Medicare select policy or certificate is sold or
issued in this state, the applicant must be provided with an explanation of coverage for
both a Medicare select basic and a Medicare select extended basic policy or certificate and must be provided
with the opportunity of purchasing
either a Medicare select basic or a Medicare select . The basic plan may also
extended basic policy
include any of the optional benefit riders authorized by section 62A.316. Preventive care
provided by Medicare select policies or certificates must be provided as set forth in section
62A.315 or 62A.316, except that the benefits are as defined in chapter 62D.
Minnesota Statutes 2010, section 62E.14, subdivision 3, is amended to read:
No person who obtains coverage pursuant to
shall be covered for any preexisting condition during the first six months
of coverage under the state plan if the person was diagnosed or treated for that condition
during the 90 days immediately preceding the date the application was received by the
writing carrier, except as provided under subdivisions 4, 4a, 4b, 4c, 4d, 5, 6, and 7
and section 62E.18.
Minnesota Statutes 2010, section 62E.14, is amended by adding a subdivision
Minnesota Statutes 2010, section 62J.81, subdivision 1, is amended to read:
(a) A health care
provider, as defined in section 62J.03, subdivision 8, or the provider's designee as agreed to
by that designee, shall, at the request of a consumer, and at no cost to the consumer or the
consumer's employer, provide that consumer with a good faith estimate of the allowable
payment the provider has agreed to accept from the consumer's health plan company
for the services specified by the consumer, specifying the amount of the allowable
payment due from the health plan company. Health plan companies must allow contracted
providers, or their designee, to release this information. If a consumer has no applicable
public or private coverage, the health care provider must give the consumer, and at no
cost to the consumer, a good faith estimate of the average allowable reimbursement the
provider accepts as payment from private third-party payers for the services specified by
the consumer and the estimated amount the noncovered consumer will be required to pay.
Payment information provided by a provider, or by the provider's designee as agreed to by
that designee, to a patient pursuant to this subdivision does not constitute a legally binding
estimate of the allowable charge for or cost to the consumer of services.
(b) A health plan company, as defined in section 62J.03, subdivision 10, shall, at the
request of an enrollee or the enrollee's
designee, provide that enrollee with a good faith estimate of the allowable amount the
health plan company has contracted for with a specified provider within the network
as total payment for a health care service specified by the enrollee and the portion of
the allowable amount due from the enrollee and the enrollee's out-of-pocket costs. An
estimate provided to an enrollee under this paragraph is not a legally binding estimate of
the allowable amount or enrollee's out-of-pocket cost.
Minnesota Statutes 2010, section 62L.03, subdivision 3, is amended to read:
(a) A small employer that has
at least 75 percent of its eligible employees who have not waived coverage participating in
a health benefit plan and that contributes at least 50 percent toward the cost of coverage of
each eligible employee must be guaranteed coverage on a guaranteed issue basis from
any health carrier participating in the small employer market. The participation level
of eligible employees must be determined at the initial offering of coverage and at the
renewal date of coverage. A health carrier must not increase the participation requirements
applicable to a small employer at any time after the small employer has been accepted for
coverage. For the purposes of this subdivision, waiver of coverage includes only waivers
due to: (1) coverage under another group health plan; (2) coverage under Medicare Parts
A and B; (3)
coverage under MCHA permitted under section 62E.141; or (4) coverage
under medical assistance under chapter 256B or general assistance medical care under
(b) If a small employer does not satisfy the contribution or participation requirements
under this subdivision, a health carrier may voluntarily issue or renew individual health
plans, or a health benefit plan which must fully comply with this chapter. A health carrier
that provides a health benefit plan to a small employer that does not meet the contribution
or participation requirements of this subdivision must maintain this information in its files
for audit by the commissioner. A health carrier may not offer an individual health plan,
purchased through an arrangement between the employer and the health carrier, to any
employee unless the health carrier also offers the individual health plan, on a guaranteed
issue basis, to all other employees of the same employer. An arrangement permitted under
section 62L.12, subdivision 2, paragraph (k), is not an arrangement between the employer
and the health carrier for purposes of this paragraph.
(c) Nothing in this section obligates a health carrier to issue coverage to a small
employer that currently offers coverage through a health benefit plan from another health
carrier, unless the new coverage will replace the existing coverage and not serve as one
of two or more health benefit plans offered by the employer. This paragraph does not
apply if the small employer will meet the required participation level with respect to
the new coverage.
Minnesota Statutes 2010, section 72A.20, subdivision 24, is amended to read:
No insurer shall
cancel or fail to for nonpayment of premium unless it mails or delivers
renew an individual life or individual health policy or an individual nonprofit health
service plan subscriber contract
named insured, at the address shown on the policy or subscriber at least 30 days before lapse, final notice of
the cancellation or nonrenewal and the effective date of the cancellation or nonrenewal.
If the named
insured is not the policy or subscriber contract owner, the notice required by this
subdivision must be sent to the insured's last known
, if any, and to the owner's last known address.
Proof of mailing of the notice of lapse for failure to
pay the premium before the expiration of the grace period is sufficient proof that notice
required in this subdivision has been given.
This subdivision does not apply to a life or health insurance policy or contract
upon which premiums are paid at a monthly interval or less and that contains any grace
period required by statute for the payment of premiums during which time the insurance
continues in force.
Minnesota Statutes 2010, section 72B.041, subdivision 5, is amended to read:
(a) An individual who applies for an adjuster license in this
state who is or was licensed in another state for the same lines of authority based on
an adjuster examination is not required to complete a prelicensing examination. This
exemption is only available if the person is currently licensed in another state or if that
state license has expired and the application is received by this state within 90 days of
expiration. The applicant must provide certification from the other state that the applicant's
license is currently in good standing or was in good standing at the time of expiration
or certification from the other state that its producer database records, maintained by
the NAIC, its affiliates, or its subsidiaries, indicate that the applicant or the applicant's
company is or was licensed in good standing. The certification must be of a license with
the same line of authority for which the individual has applied.
(b) A person licensed as an adjuster in another state based on an adjuster examination
who establishes legal residency in this state must make application within 90 days to
become a resident adjuster licensee pursuant to this section, with the exception that no
prelicensing examination is required of this person.
A person who has held a license of any given class or in any field or fields within
three years prior to the application shall be entitled to a renewal of the license in the same
class or in the same fields without taking an examination.
(d) A person applying for a license as a crop hail adjuster shall not be required to
comply with the requirements of subdivision 4.
Minnesota Statutes 2010, section 79A.06, subdivision 5, is amended to read:
employers who have ceased to be private self-insurers shall discharge their continuing
obligations to secure the payment of compensation which is accrued during the period of
self-insurance, for purposes of Laws 1988, chapter 674, sections 1 to 21, by compliance
with all of the following obligations of current certificate holders:
(1) Filing reports with the commissioner to carry out the requirements of this chapter;
(2) Depositing and maintaining a security deposit for accrued liability for the
payment of any compensation which may become due, pursuant to chapter 176. However,
if a private employer who has ceased to be a private self-insurer purchases an insurance
policy from an insurer authorized to transact workers' compensation insurance in this state
which provides coverage of all claims for compensation arising out of injuries occurring
during the entire period the employer was self-insured, whether or not reported during
that period, the policy will:
(i) discharge the obligation of the employer to maintain a security deposit for the
payment of the claims covered under the policy;
(ii) discharge any obligation which the self-insurers' security fund has or may have
for payment of all claims for compensation arising out of injuries occurring during the
period the employer was self-insured, whether or not reported during that period; and
(iii) discharge the obligations of the employer to pay any future assessments to
the self-insurers' security fund; provided, however, that a member that terminates its
self-insurance authority on or after August 1, 2010, shall be liable for an assessment under
paragraph (b). The actuarial opinion shall not take into consideration any transfer of the
member's liabilities to an insurance policy if the member obtains a replacement policy as
described in this subdivision within one year of the date of terminating its self-insurance.
A private employer who has ceased to be a private self-insurer may instead buy an
insurance policy described above, except that it covers only a portion of the period of time
during which the private employer was self-insured; purchase of such a policy discharges
any obligation that the self-insurers' security fund has or may have for payment of all
claims for compensation arising out of injuries occurring during the period for which the
policy provides coverage, whether or not reported during that period.
A policy described in this clause may not be issued by an insurer unless it has
previously been approved as to form and substance by the commissioner; and
(3) Paying within 30 days all assessments of which notice is sent by the security
fund, for a period of seven years from the last day its certificate of self-insurance was in
effect. Thereafter, the private employer who has ceased to be a private self-insurer may
either: (i) continue to pay within 30 days all assessments of which notice is sent by the
security fund until it has no incurred liabilities for the payment of compensation arising
out of injuries during the period of self-insurance; or (ii) pay the security fund a cash
payment equal to four percent of the net present value of all remaining incurred liabilities
for the payment of compensation under sections 176.101 and 176.111 as certified by a
member of the casualty actuarial society. Assessments shall be based on the benefits paid
by the employer during the calendar year immediately preceding the calendar year in
which the employer's right to self-insure is terminated or withdrawn.
(b) With respect to a self-insurer who terminates its self-insurance authority after
April 1, 1998, that member shall obtain and file with the commissioner an actuarial
opinion of its outstanding liabilities as determined by an associate or fellow of the
Casualty Actuarial Society within 120 days of the date of its termination. If the actuarial
opinion is not timely filed, the self-insurers' security fund may, at its discretion, engage
the services of an actuary for this purpose. The expense of this actuarial opinion must be
assessed against and be the obligation of the self-insurer. The commissioner may issue
a certificate of default against the self-insurer for failure to pay this assessment to the
self-insurers' security fund as provided by section 79A.04, subdivision 9. The opinion
may discount liabilities up to four percent per annum to net present value. Within 60 days
after notification of approval of the actuarial opinion by the commissioner, the exiting
member shall pay to the security fund an amount determined as follows: a percentage will
be determined by dividing the security fund's members' deficit as determined by the most
recent audited financial statement of the security fund by the total actuarial liability of all
members of the security fund as calculated by the commissioner within 30 days of the
exit date of the member. This quotient will then be multiplied by that exiting member's
total future liability as contained in the exiting member's actuarial opinion. If the payment
is not made within 30 days of the notification, interest on it at the rate prescribed by
section 549.09 must be paid by the former member to the security fund until the principal
amount is paid in full.
(c) A former member who terminated its self-insurance authority before April 1,
1998, who has paid assessments to the self-insurers' security fund for seven years, and
whose annualized assessment is $15,000 or less, may buy out of its outstanding liabilities
to the self-insurers' security fund by an amount calculated as follows: 1.35 multiplied by
the indemnity case reserves at the time of the calculation, multiplied by the then current
self-insurers' security fund annualized assessment rate.
(d) A former member who terminated its self-insurance authority before April 1,
1998, and who is paying assessments within the first seven years after ceasing to be
self-insured under paragraph (a), clause (3), may elect to buy out its outstanding liabilities
to the self-insurers' security fund by obtaining and filing with the commissioner an
actuarial opinion of its outstanding liabilities as determined by an associate or fellow of
the Casualty Actuarial Society. The opinion must separate liability for indemnity benefits
from liability for medical benefits, and must discount each up to four percent per annum to
net present value. Within 30 days after notification of approval of the actuarial opinion
by the commissioner, the member shall pay to the security fund an amount equal to 120
percent of that discounted outstanding indemnity liability, multiplied by the greater of the
average annualized assessment rate since inception of the security fund or the annual rate
at the time of the most recent assessment.
(e) A former member who has paid the security fund according to paragraphs (b) to
(d) and subsequently receives authority from the commissioner to again self-insure shall be
assessed under section 79A.12, subdivision 2, only on indemnity benefits paid on injuries
that occurred after the former member received authority to self-insure again; provided
that the member furnishes verified data regarding those benefits to the security fund.
(f) In addition to proceedings to establish liabilities and penalties otherwise
provided, a failure to comply may be the subject of a proceeding before the commissioner.
An appeal from the commissioner's determination may be taken pursuant to the contested
case procedures of chapter 14 within 30 days of the commissioner's written determination.
Any current or past member of the self-insurers' security fund is subject to service of
process on any claim arising out of chapter 176 or this chapter in the manner provided by
section 5.25, or as otherwise provided by law. The issuance of a certificate to self-insure
to the private self-insured employer shall be deemed to be the agreement that any process
which is served in accordance with this section shall be of the same legal force and effect
as if served personally within this state.
Minnesota Statutes 2010, section 79A.24, is amended by adding a subdivision
Minnesota Statutes 2010, section 79A.24, is amended by adding a subdivision
Minnesota Statutes 2010, section 82.641, subdivision 1, is amended to read:
The commissioner shall issue
a license as a closing agent to a person who qualifies for the license under the terms
of this chapter.
Minnesota Statutes 2010, section 82B.11, subdivision 6, is amended to read:
(a) The commissioner shall issue a license for
temporary practice as a real estate appraiser under subdivision 3, 4, or 5 to a person
certified or licensed by another state if:
(1) the property to be appraised is part of a federally related transaction and the
person is licensed to appraise property limited to the same transaction value or complexity
provided in subdivision 3, 4, or 5;
(2) the appraiser's business is of a temporary nature; and
(3) the appraiser registers with the commissioner to obtain a temporary license
before conducting appraisals within the state.
(b) The term of a temporary practice license is the lesser of:
(1) the time required to complete the assignment; or
six months , with one extension allowed. The appraiser may request one extension of no more than six months on a form If more than 12 months are necessary to complete the
provided by the commissioner.
assignment, a new temporary application and fee is required.
Minnesota Statutes 2010, section 82B.13, is amended by adding a subdivision
Minnesota Statutes 2010, section 82B.14, is amended to read:
(a) As a prerequisite for licensing as a licensed real property appraiser, an applicant
must present evidence satisfactory to the commissioner that the person has obtained 2,000
hours of experience in real property appraisal obtained in no fewer than 12 months.
As a prerequisite for licensing as a certified residential real property appraiser, an
applicant must present evidence satisfactory to the commissioner that the person has
obtained 2,500 hours of experience in real property appraisal obtained in no fewer than
As a prerequisite for licensing as a certified general real property appraiser, an
applicant must present evidence satisfactory to the commissioner that the person has
obtained 3,000 hours of experience in real property appraisal obtained in no fewer than 30
months. At least 50 percent, or 1,500 hours, must be in nonresidential appraisal work.
(b) Each applicant for license under section 82B.11, subdivision 3, 4, or 5, shall
give under oath a detailed listing of the real estate appraisal reports or file memoranda
for which experience is claimed by the applicant. Upon request, the applicant shall make
available to the commissioner for examination, a sample of appraisal reports that the
applicant has prepared in the course of appraisal practice.
(c) Notwithstanding section 45.22, a college or university real estate course may be
approved retroactively by the commissioner for appraiser prelicense education credit if:
(1) the course was offered by a college or university physically located in Minnesota;
(2) the college or university was an approved education provider at the time the
course was offered;
(3) the commissioner's approval is made to the same extent in terms of courses and
hours and with the same time limits as those specified by the Appraiser Qualifications
(d) Applicants may not receive credit for experience accumulated while
unlicensed, if the experience is based on activities which required a license under this
(e) Experience for all classifications must be obtained after January 30, 1989,
and must be USPAP compliant.
Minnesota Statutes 2010, section 82C.08, subdivision 2, is amended to read:
(a) Each application for initial licensure shall be accompanied
by a fee of $5,000.
(b) Each application for renewal of the license must be received prior to
the two-year expiration period with the renewal fee of $2,500.