S*0991(Rat #0303, Act #0278 of 1996)  General Bill, By Saleeby
 A Bill to amend Section 38-55-530, Code of Laws of South Carolina, 1976,
 relating to definitions under the "Omnibus Insurance Fraud and Reporting
 Immunity Act", so as to delete reference to "Division of Motor Vehicles" in
 the definition of "authorized agency", add the specific names of certain state
 agencies, and include all other state boards, commissions, and agencies in
 that definition, and to add language to the definition of "false statement and
 misrepresentation"; to amend Section 38-55-570, as amended, relating to the
 "Omnibus Insurance Fraud and Reporting Immunity Act" and notification to the
 Insurance Fraud Division of the Office of the State Attorney General of
 knowledge or belief of false statements or misrepresentations, so as to delete
 reference to the "motor vehicle division"; and to amend Section 38-55-580,
 relating to the "Omnibus Insurance Fraud and Reporting Immunity Act" and
 immunity from liability arising out of providing information concerning false
 statements or misrepresentations to an authorized agency, so as to provide,
 among other things, that in addition to the immunity granted in this Section,
 persons identified as designated employees whose responsibilities include the
 investigation and disposition of claims relating to suspected fraudulent
 insurance acts may share information relating to persons suspected of
 committing fraudulent insurance acts with other designated employees employed
 by the same or other insurers whose responsibilities include the investigation
 and disposition of claims relating to fraudulent insurance acts under certain
 conditions.-amended title

   01/10/96  Senate Introduced and read first time SJ-11
   01/10/96  Senate Referred to Committee on Banking and Insurance SJ-11
   02/13/96  Senate Committee report: Favorable with amendment
                     Banking and Insurance SJ-8
   02/14/96  Senate Amended SJ-23
   02/14/96  Senate Read second time SJ-23
   02/15/96  Senate Read third time and sent to House SJ-15
   02/20/96  House  Introduced and read first time HJ-11
   02/20/96  House  Referred to Committee on Labor, Commerce and
                     Industry HJ-11
   03/27/96  House  Committee report: Favorable with amendment Labor,
                     Commerce and Industry HJ-4
   03/28/96  House  Amended HJ-65
   03/28/96  House  Read second time HJ-66
   04/02/96  House  Read third time and returned to Senate with
                     amendments HJ-11
   04/09/96  Senate Concurred in House amendment and enrolled SJ-10
   04/30/96         Ratified R 303
   05/06/96         Signed By Governor
   05/06/96         Effective date 05/06/96
   05/16/96         Copies available
   05/16/96         Act No. 278

AN ACT TO AMEND SECTION 38-55-530, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DEFINITIONS UNDER THE "OMNIBUS INSURANCE FRAUD AND REPORTING IMMUNITY ACT", SO AS TO DELETE REFERENCE TO "DIVISION OF MOTOR VEHICLES" IN THE DEFINITION OF "AUTHORIZED AGENCY", ADD THE SPECIFIC NAMES OF CERTAIN STATE AGENCIES, AND INCLUDE ALL OTHER STATE BOARDS, COMMISSIONS, AND AGENCIES IN THAT DEFINITION, AND TO ADD LANGUAGE TO THE DEFINITION OF "FALSE STATEMENT AND MISREPRESENTATION"; TO AMEND SECTION 38-55-570, AS AMENDED, RELATING TO THE "OMNIBUS INSURANCE FRAUD AND REPORTING IMMUNITY ACT" AND NOTIFICATION TO THE INSURANCE FRAUD DIVISION OF THE OFFICE OF THE STATE ATTORNEY GENERAL OF KNOWLEDGE OR BELIEF OF FALSE STATEMENTS OR MISREPRESENTATIONS, SO AS TO DELETE REFERENCE TO THE "MOTOR VEHICLE DIVISION"; AND TO AMEND SECTION 38-55-580, RELATING TO THE "OMNIBUS INSURANCE FRAUD AND REPORTING IMMUNITY ACT" AND IMMUNITY FROM LIABILITY ARISING OUT OF PROVIDING INFORMATION CONCERNING FALSE STATEMENTS OR MISREPRESENTATIONS TO AN AUTHORIZED AGENCY, SO AS TO PROVIDE, AMONG OTHER THINGS, THAT IN ADDITION TO THE IMMUNITY GRANTED IN THIS SECTION, PERSONS IDENTIFIED AS DESIGNATED EMPLOYEES WHOSE RESPONSIBILITIES INCLUDE THE INVESTIGATION AND DISPOSITION OF CLAIMS RELATING TO SUSPECTED FRAUDULENT INSURANCE ACTS MAY SHARE INFORMATION RELATING TO PERSONS SUSPECTED OF COMMITTING FRAUDULENT INSURANCE ACTS WITH OTHER DESIGNATED EMPLOYEES EMPLOYED BY THE SAME OR OTHER INSURERS WHOSE RESPONSIBILITIES INCLUDE THE INVESTIGATION AND DISPOSITION OF CLAIMS RELATING TO FRAUDULENT INSURANCE ACTS UNDER CERTAIN CONDITIONS.

Be it enacted by the General Assembly of the State of South Carolina:

Definition changed

SECTION 1. Section 38-55-530(A) of the 1976 Code, as added by Part II, Section 31A of Act 497 of 1994, is amended to read:

"(A) `Authorized agency' means any duly constituted criminal investigative department or agency of the United States or of this State; the Department of Insurance; the Department of Revenue and Taxation; the Department of Public Safety; the Workers' Compensation Commission; the State Accident Fund; the Second Injury Fund; the Employment Security Commission; the Department of Consumer Affairs; the Human Affairs Commission; the Department of Health and Environmental Control; the Department of Social Services; the Department of Health and Human Services; the Department of Labor, Licensing and Regulation; all other state boards, commissions, and agencies; the Office of the Attorney General of this State; or the prosecuting attorney of any judicial circuit, county, municipality, or political subdivision of this State or of the United States, and their respective employees or personnel acting in their official capacity."

Definition changed

SECTION 2. Section 38-55-530(D) of the 1976 Code, as added by Part II, Section 31A of Act 497 of 1994, is amended to read:

"(D) `False statement and misrepresentation' means a statement or representation made by a person that is false, material, made with the person's knowledge of the falsity of the statement, and made with the intent of obtaining or causing another to obtain or attempting to obtain or causing another to obtain an undeserved economic advantage or benefit or made with the intent to deny or cause another to deny any benefit or payment in connection with an insurance transaction and such shall constitute fraud."

Reference deleted

SECTION 3. Section 38-55-570(C) of the 1976 Code, as added by Part II, Section 31A of Act 497 of 1994, is amended to read:

"(C) Any authorized agency provided with or obtaining information relating to a suspected false statement or misrepresentation as provided for above may release or provide the information to any other authorized agency. The Department of Insurance, the Department of Revenue and Taxation, and the Department of Public Safety shall report, but not adjudicate, all cases of suspected or reported false statement or misrepresentation to the Insurance Fraud Division of the Office of Attorney General for appropriate investigation or prosecution, or both. The Workers' Compensation Commission may refer such cases as provided in Section 42-9-440."

Sharing of information; etc.

SECTION 4. Section 38-55-580 of the 1976 Code, as added by Part II, Section 31A of Act 497 of 1994, is amended to read:

"Section 38-55-580. (A) A person, insurer, or authorized agency, when acting without malice or in good faith, is immune from any liability arising out of filing reports, cooperating with investigations by any authorized agency, or furnishing other information, whether written or oral, and whether in response to a request by an authorized agency or upon their own initiative, concerning any suspected, anticipated, or completed false statement or misrepresentation when such reports or information are provided to or received by any authorized agency.

(B) Nothing herein abrogates or modifies in any way common law or statutory privilege or immunity heretofore enjoyed by any person, insurer, or authorized agency.

(C) Nothing herein limits the liability of any person or insurer who, with malice or in bad faith, makes a report of suspected fraud under the provisions of this article.

(D) In addition to the immunity granted in this section, persons identified as designated employees whose responsibilities include the investigation and disposition of claims relating to suspected fraudulent insurance acts may share information relating to persons suspected of committing fraudulent insurance acts with other designated employees employed by the same or other insurers whose responsibilities include the investigation and disposition of claims relating to fraudulent insurance acts, provided the department has been given written notice of the names and job titles of these designated employees prior to any designated employee sharing information. Unless the designated employees of the insurer act in bad faith or in reckless disregard for the rights of any insured, neither the insurer nor its designated employees are civilly liable for libel, slander, or any other relevant tort, and a civil action does not arise against the insurer or its designated employees:

(1) for any information related to suspected fraudulent insurance acts provided to an insurer; or

(2) for information related to suspected fraudulent insurance acts provided to the National Insurance Crime Bureau or the National Association of Insurance Commissioners.

Provided, however, that the qualified immunity against civil liability conferred on any insurer or its designated employees shall be forfeited with respect to the exchange or publication of any defamatory information with third persons not expressly authorized by subsection (D) to share in such information."

Time effective

SECTION 5. This act takes effect upon approval by the Governor.

Approved the 6th day of May, 1996.