Current Status Bill Number:4574 Type of Legislation:General Bill GB Introducing Body:House Introduced Date:19960207 Primary Sponsor:Wright All Sponsors:Wright, Cato, Stuart, Kirsh, Meacham, Richardson, Simrill, Riser and Robinson Drafted Document Number:pt\2205jm.96 Residing Body:House Current Committee:Labor, Commerce and Industry Committee 26 HLCI Subject:Insurance, assigned risk agreements
Body Date Action Description Com Leg Involved
______ ________ _______________________________________ _______ ____________
House 19960207 Introduced, read first time, 26 HLCI
referred to Committee
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TO AMEND SECTION 38-73-540, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO INSURANCE, CASUALTY AND SURETY RATES, AND ASSIGNED RISK, SO AS TO, AMONG OTHER THINGS, AUTHORIZE THE MAKING OF ASSIGNED RISK AGREEMENTS AMONG INSURERS, DELETE CERTAIN LANGUAGE AND PROVISIONS, PROVIDE THAT A RESIDUAL MARKET AGREEMENT AND ANY MECHANISM DESIGNED TO IMPLEMENT SUCH AGREEMENT MUST BE SUBMITTED IN WRITING TO THE DIRECTOR OF THE DEPARTMENT OF INSURANCE OR HIS DESIGNEE FOR APPROVAL PRIOR TO USE, PROVIDE THAT THE DIRECTOR OR HIS DESIGNEE MAY ALLOW INSURERS TO SUBMIT WRITTEN REQUESTS TO BE DESIGNATED AS A STATE SERVICING CARRIER FOR THE ASSIGNED RISK POOL FOR WORKERS' COMPENSATION INSURANCE, AND PROVIDE FOR RELATED MATTERS.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 38-73-540 of the 1976 Code, as last amended by Section 783 of Act 181 of 1993, is further amended to read:
"Section 38-73-540. (A)(1) Assigned risk Agreements agreements may be made among insurers with respect to the equitable apportionment among them of insurance which may be afforded applicants who are in good faith entitled to, but who are unable to procure, insurance through ordinary methods, and the insurers may agree among themselves on the use of reasonable rate modifications for this insurance. These agreements and rate modifications are subject to the approval of the director or his designee. However, regardless of any provision of this section or this article to the contrary, assigned risk pools shall accept a policy of workers' compensation insurance on the basis that it provides coverage to a vendor who provides logging services to a named insured or on the basis that the policy provides coverage to an association of these vendors. Such residual market agreement and any mechanism designed to implement such agreement, and any amendments thereto, must be submitted in writing to the director or his designee for approval prior to use, together with such additional information as the director or his designee may reasonably require.
(2) If, after a hearing, the director or his designee finds that any activity or practice of insurers participating in the residual market mechanism is unfair, unreasonable, or otherwise inconsistent with the provisions of this title, the director or his designee must issue a written order specifying in what respects such activity or practice is unfair, unreasonable, or otherwise inconsistent with the provisions of this title and require the discontinuance of such activity or practice. The director or his designee may establish an Assigned Risk Plan or mechanism to implement assigned risk agreements by written order if the director or his designee finds that the existing residual market mechanism is unfair, unreasonable, or inconsistent with the provisions of this chapter.
(3) The director or his designee may allow insurers to submit written requests to be designated as a state servicing carrier for the assigned risk pool for workers' compensation insurance. If the director or his designee issues a notice that a state bidding procedure for servicing carrier designation has the potential to yield benefits to the insureds and the insurers, such state bidding procedure shall be the sole method authorized to select state servicing carriers. The director or his designee may appoint a committee of such individuals he deems qualified to establish procedures for the submission of proposals for designation as a servicing carrier, to establish standards for the designation of a state servicing carrier, and to award state servicing carrier contracts pursuant to the bidding process, subject to the final approval of the director or his designee.
(4) Notwithstanding any other provision of this section or of this article, assigned risk pools must accept a policy of workers's compensation insurance on the basis that it provides coverage to a vendor who provides logging services to a named insured or on the basis that the policy provides coverage to an association of these vendors.
(B)(1) Notwithstanding the provisions of subsection (A), no insurer may act as a servicing carrier for any assigned risk pool for workers' compensation insurance authorized pursuant to subsection (A) unless such insurer participates in the voluntary market for workers' compensation insurance in this State.
(2) The provisions of this subsection (B) do not apply to servicing carrier contracts entered into before the effective date of this subsection (B). No servicing carrier contract in existence on the effective date of this subsection (B) may be renewed unless there is compliance with part (1) of this subsection."
SECTION 2. This act takes effect upon approval by the Governor.