Current Status Bill Number:
3335Type of Legislation: General Bill GBIntroducing Body: HouseIntroduced Date: 19950119Primary Sponsor: CatoAll Sponsors: Cato, Tripp, Hallman, Fulmer, Trotter, Cooper, Law, Meacham, Mason, A. Young, Stuart and S. WhipperDrafted Document Number: BBM\9766JM.95Residing Body: HouseCurrent Committee: Labor, Commerce and Industry Committee 26 HLCISubject: Motor vehicle insurance
Body Date Action Description Com Leg Involved ______ ________ _______________________________________ _______ ____________ House 19950119 Introduced, read first time, 26 HLCI referred to CommitteeView additional legislative information at the LPITS web site.
TO AMEND SECTION 38-77-280, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE AUTOMOBILE INSURANCE LAW AND COLLISION AND COMPREHENSIVE COVERAGES, SO AS TO DELETE CERTAIN PROVISIONS, PERMIT, RATHER THAN REQUIRE, COLLISION COVERAGE AND EITHER COMPREHENSIVE OR FIRE, THEFT, AND COMBINED ADDITIONAL COVERAGE TO BE MADE AVAILABLE TO AN INSURED OR QUALIFIED APPLICANT, AND PROVIDE, AMONG OTHER THINGS, THAT INSURERS WRITING SINGLE INTEREST COLLISION COVERAGE SHALL PROVIDE AN APPLICANT FOR THE INSURANCE AT THE TIME OF HIS APPLICATION A CERTAIN NOTICE SEPARATE AND APART FROM ANY OTHER FORM USED IN THE APPLICATION AND THAT, IF THE DIRECTOR OF THE DEPARTMENT OF INSURANCE OR HIS DESIGNEE FINDS THAT AN INSURER IS PARTICIPATING IN DISCRIMINATORY PRACTICES, THE DIRECTOR OR HIS DESIGNEE MAY IMPOSE A FINE ON THE INSURER OF UP TO TWO HUNDRED THOUSAND DOLLARS; AND TO REQUIRE ALL INSURERS SUBJECT TO THE PROVISIONS OF SECTION 38-77-280 TO SUBMIT RATE FILINGS TO THE DIRECTOR OF THE DEPARTMENT OF INSURANCE WITHIN TWELVE MONTHS FOLLOWING THE EFFECTIVE DATE OF THIS ACT, WHICH FILINGS MUST REFLECT THE RATE DECREASES, IF ANY, ATTRIBUTABLE TO THE PASSAGE OF THIS ACT.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 38-77-280 of the 1976 Code, as last amended by Section 810 of Act 181 of 1993, is further amended to read:
"Section 38-77-280. (A) Except as provided in subsection (B), all automobile insurers, including those insurance companies writing private passenger physical damage coverages only, shall may make collision coverage and either comprehensive or fire, theft, and combined additional coverage available to an insured or qualified applicant who requests the coverage.
If collision coverage is offered or provided, it must have a mandatory deductible of two hundred fifty dollars, but an insured or qualified applicant, at his option, may select an additional deductible in appropriate increments up to one thousand dollars.
If comprehensive coverage or fire, theft, and combined additional coverages are offered or provided, they must have a mandatory deductible of two hundred fifty dollars, but an insured, at his option, may select an additional deductible in appropriate increments up to one thousand dollars. This deductible does not apply to auto safety glass. It is an unfair trade practice, as described in Sections 38-57-30 and 38-57-40, for an insurer or an agent to sell collision insurance, comprehensive coverage, or fire, theft, and combined additional coverages unless the insured is notified at the time of application of the savings which may be realized if the applicant or the insured selects a higher deductible. This notice is required only at the time of the initial sale and must be in a form approved by the director or his designee. An insurer may offer insureds lower deductibles at the insurer's option.
(B) Notwithstanding subsection (A) and Sections 38-77-110 and 38-77-920, automobile insurers may refuse to write automobile physical damage insurance coverage, including automobile comprehensive physical damage, collision, fire, theft, and combined additional coverage, for an applicant or existing policyholder, on renewal, for a motor vehicle customarily operated by an individual, either the named insured or another operator not excluded in accordance with Section 38-77-340 and who resides in the same household, where one or more of the conditions or factors prescribed in Section 38-73-455 exist. In addition, automobile insurers may refuse to write physical damage insurance coverage to an applicant or existing policyholder, on renewal, who has collected benefits provided under automobile insurance physical damage coverage during the thirty-six months immediately preceding the effective date of coverage, for two or more total fire losses or two or more total theft losses. Automobile insurers may refuse to write for private passenger automobiles physical damage insurance coverage, including automobile comprehensive physical damage, collision, fire, theft, and combined additional coverage, for an applicant or existing policyholder, on renewal, for a motor vehicle customarily operated by an individual, either the named insured or another operator not excluded in accordance with Section 38-77-340 and who resides in the same household, which does not qualify for the safe driver discount in Section 38-73-760(e). All insurers subject to the provisions of this section writing single interest collision coverage shall provide an applicant for the insurance at the time of his application a notice separate and apart from any other form used in the application. The notice must be signed by the applicant evidencing his acknowledgment of having read the notice. This notice must contain the following language printed in bold-face type:
`NOTICE: THE INSURANCE COVERAGE YOU ARE HEREBY PURCHASING IS ONLY SINGLE INTEREST COLLISION COVERAGE. THE AMOUNT OF INSURANCE DECREASES AS YOU PAY OFF THE AMOUNT OF YOUR INDEBTEDNESS. YOU MAY NOT RECEIVE ANY INSURANCE PROCEEDS OVER AND ABOVE THE AMOUNT OF THE OUTSTANDING BALANCE ON YOUR LOAN.'
(C) Notwithstanding Section 38-77-110, automobile physical damage coverage in an automobile insurance policy may be canceled at any time during the policy period by reason of the factors or conditions described in Section 38-73-455(A) or Section 38-77-280(B) which existed before the commencement of the policy period and which were not disclosed to the insurer at the commencement of the policy period.
(D) No policy of insurance which provides automobile physical damage coverage only may be ceded to the facility.
(E) Insurers of automobile insurance may charge a rate for physical damage insurance coverages different than from those provided for in Section 38-73-457 if the rates are filed with the department and approved by the director or his designee. Any applicant or existing policyholder, to be charged this different rate, must be denied the coverage pursuant to subsection (B) at the rate provided in Section 38-73-457.
(F) A carrier may not cede collision coverage, comprehensive coverage, or fire, theft, and combined additional coverages with a deductible of less than two hundred fifty dollars. An insured or qualified applicant may select an additional deductible in appropriate increments up to one thousand dollars. However, the mandatory deductible does not apply to safety glass. In determining the premium rates to be charged on automobile insurance, it is unlawful to consider race, color, creed, religion, national origin, ancestry, location of residence, occupation, or economic status. If the Director of the Department of Insurance, or his designee, finds that the insurer is participating in discriminatory practices, the director, or his designee, may impose a fine on the insurer of up to two hundred thousand dollars."
SECTION 2. All insurers subject to the provisions of Section 38-77-280 of the 1976 Code shall submit rate filings to the Director of the Department of Insurance within twelve months following the effective date of this act. These filings must reflect the rate decreases, if any, attributable to the passage of this act.
SECTION 3. This act takes effect October 1, 1996.