The director may seek injunctive relief to aid in the enforcement of the provisions of this chapter.
Repealed or Renumbered
Repealed or Renumbered
Repealed or Renumbered
Repealed or Renumbered
Repealed or Renumbered
A person may not enter into an agreement to commit, or by any concerted action commit, an act of boycott, coercion, or intimidation resulting in or tending to result in unreasonable restraint of, or monopoly in, the business of insurance.
Repealed or Renumbered
A person may not violate the applicable provisions of AS 21.56.180 .
An insurer may not deny a claim if a risk, hazard, or contingency insured against is the dominant cause of a loss and the denial occurs because an excluded risk, hazard, or contingency is also in a chain of causes but operates on a secondary basis.
Repealed or Renumbered
The powers vested in the director by this chapter are in addition to any other powers to enforce penalties, fines, or other forfeitures authorized by law with respect to acts and practices declared in this chapter to be unfair or deceptive.
If a notice is required from an insurer under this chapter, the insurer shall
(1) mail the notice by first class mail to the last known address of the insured; and
(2) obtain a certificate of mailing from the U.S. Postal Service.
The purpose of this chapter is to regulate an act or a trade practice in the business of insurance in accordance with the intent of Congress as expressed in 15 U.S.C. 1011 - 1015 (McCarran-Ferguson Act) by defining or providing for determination of all the practices in this state that constitute an unfair method of competition or an unfair or deceptive act or practice and by prohibiting them.
The director of insurance shall adopt regulations to implement, define, and enforce AS 21.36.125 .
A person may not engage in an act or a trade practice in this state or relative to a subject resident, located, or to be performed in this state that is defined in this chapter as, or determined under this chapter to be, an unfair method of competition or an unfair or deceptive act or practice in the business of insurance.
A claim form must contain a statement that states in substance the following: 'A person who knowingly and with intent to injure, defraud, or deceive an insurance company files a claim containing false, incomplete, or misleading information may be prosecuted under state law.' A lack of the statement on a claim form does not constitute a defense to prosecution under this title.
A person may not make or issue, or cause to be made or issued, a written or oral statement misrepresenting or making incomplete comparisons as to the terms, conditions, or benefits contained in a policy for the purpose of inducing or attempting or tending to induce the policyholder to lapse, forfeit, surrender, retain, exchange, or convert an insurance policy.
A financial institution may not allow a person to transact insurance in an office of the institution or on behalf of the institution, unless the person is licensed as required under AS 21.27.
A person may not issue or deliver or permit its agents, officers, or employees to issue or deliver, agency company stock or other capital stock, or benefit certificates or shares in a common law corporation, or securities, or an advisory board contract or other similar contract of any kind promising returns and profits as an inducement to insurance.
A person may not violate the viatical settlement transaction provisions of AS 21.89.110 or regulations adopted under AS 21.89.110 .
A surplus lines broker or an insurance producer may not fail to provide evidence of insurance, affidavits, filings, or reports, or fail to maintain the records, or fail to pay the taxes and fees, required under AS 21.34.
Notwithstanding the failure of an insurer to comply with AS 21.36.210 - 21.36.310, termination of coverage under the policy either by cancellation or nonrenewal is effective on the effective date of any other policy providing similar coverage on the same risk or motor vehicle or a replacement of it.
An insurer who refuses to provide insurance coverage to an applicant initially applying for insurance shall
(1) inform the applicant that the applicant has a right to know the reason for the refusal; and
(2) upon receipt of a written request from the applicant, provide a written explanation of the refusal to the applicant.
(a) A policy with a policy period or term longer than one year or a policy with no fixed expiration date shall be considered to be written for successive policy periods or terms of one year, and termination by an insurer effective on an anniversary date of the policy shall be considered a failure to renew.
(b) The rate for a personal automobile insurance policy may not be changed more frequently than once every six months.
(a) If material the director seeks to obtain is located outside the state, the material may be made available to the director to examine at the place where the material is located. The director may designate representatives, including officials of the state in which the material is located, to inspect the material on behalf of the director.
(b) The director may respond to a request from an official of another state under procedures established in (a) of this section.
For the purpose of AS 21.36.360 , the charging and collection by surplus line brokers licensed under AS 21.27 of the amount of applicable state and federal taxes and filing fees under AS 21.34 is not considered a premium or charge for insurance.
If property insurance is required in connection with a debt or loan, the debtor or borrower has the reasonable right to select the insurance producer and insurer through whom the insurance is to be placed if (1) the insurance is provided for the protection of the creditor's or lender's interest in the property at the commencement of the risk; or (2) in the case of renewal of insurance, the renewal policy is delivered to the creditor or lender no later than 30 days before the renewal date.
A person may not make, publish, disseminate, circulate, or place before the public, or cause, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public, in a newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter, or poster, or over a radio or television station, or in any other way, an advertisement, announcement, or statement containing an assertion, representation, or statement with respect to the business of insurance or with respect to a person in the conduct of the person's insurance business, that is untrue, deceptive, or misleading.
(a) A person may not make, publish, disseminate, or circulate, directly or indirectly, or aid, abet, or encourage the making, publishing, disseminating, or circulating of an oral or written statement or a pamphlet, circular, article, or literature that is false, or maliciously critical of or derogatory to the financial condition of a person in the insurance business or proposing to enter the insurance business and that is calculated to injure a person engaged or proposing to engage in the business of insurance.
(b) A person providing the director with information concerning the financial condition or an act or a practice of a licensee of the division is immune from liability for defamation.
(a) A person may not knowingly file with a public official, or knowingly make, publish, disseminate, circulate, or deliver to a person, or place before the public, or knowingly cause, directly or indirectly, to be made, published, disseminated, circulated, delivered to a person, or placed before the public, a false statement of the financial condition of a person in the insurance business.
(b) A person may not make a false entry in a book, report, or statement of a person in the insurance business, knowing it to be a false entry, or knowingly omit to make a true entry of a material fact pertaining to the business of a person in the insurance business in a book, report, or statement.
An insurer shall maintain a complete record of all the complaints received by the insurer since the date of the insurer's last market conduct examination under AS 21.06.120 or for four years, whichever occurs first. This record must indicate the total number of complaints, the classification of each complaint by line of insurance, the nature of each complaint, the disposition of each complaint, and the time it took to process each complaint. For purposes of this section, 'complaint' means any written communication primarily expressing a grievance.
When a policy of automobile liability insurance is cancelled, other than for nonpayment of premium, or is not renewed in accordance with AS 21.36.240, the insurer shall notify the named insured of possible eligibility for automobile insurance through the automobile assigned risk plan, or automobile insurance plan. The notification must accompany or be included in the notice of cancellation or nonrenewal required by AS 21.36.220 and 21.36.240.
The director shall adopt regulations regarding the release of financial and health information regarding an individual who seeks to obtain, obtains, or has obtained an insurance product or service from a licensee that is to be used primarily for personal, family, or household purposes. The regulations must be at least as restrictive as the model regulations adopted under the National Conference of Insurance Legislators Financial Information Privacy Protection Model Act, adopted by the National Conference of Insurance Legislators Executive Committee on November 17, 2000, and amended on March 2, 2001.
There is no liability on the part of, and a cause of action of any nature may not arise against, the director of insurance or against an insurer, its authorized representatives, agents, or employees, or a person furnishing to the insurer information as to reasons for cancellation, for any statement made by any of them in a written notice of cancellation, or in any other communication, oral or written, specifying the reasons for cancellation, or the providing of information pertaining to a cancellation or for statements made or evidence submitted at a hearing conducted in connection with a cancellation. However, this immunity from liability does not apply when the information furnished or statement made is untrue and the person furnishing the information or making the statement knew of the lack of truth or was grossly negligent in ascertaining the truth.
(a) A person who has a conviction for a felony involving dishonesty or a breach of trust may not engage or participate in the business of insurance without receiving prior written consent by the director as required under 18 U.S.C. 1033 and 1034 (Violent Crime Control and Law Enforcement Act of 1994).
(b) A person who fails to seek prior written consent from the director under (a) of this section is in violation of this chapter.
(c) A person who is engaged in the business of insurance may not knowingly permit the participation in the business of insurance by a person who has been convicted of a felony involving dishonesty or breach of trust except as allowed under (a) of this section.
(a) A person is not liable for civil damages for filing a report with or furnishing other information whether written or oral, concerning suspected, anticipated, or completed fraudulent acts to
(1) law enforcement officials, their agents, and employees;
(2) the National Association of Insurance Commissioners, the division of insurance, an agency in a state that regulates insurance, or an organization established to detect and prevent fraudulent insurance acts, their agents, employees, or designees;
(3) a person involved in the prevention and detection of fraudulent insurance acts or that person's employees, agents, or representatives.
(b) This section does not preclude liability for civil damages as a result of reckless, wilful, or intentional misconduct.
(a) An insurer may retain, invest in, or acquire the whole or a part of the capital stock of another insurer or insurers, or have a common management with another insurer or insurers, unless the retention, investment, acquisition, or common management is inconsistent with a provision of this title, or unless by reason thereof the business of the insurers with the public is conducted in a manner that substantially lessens competition generally in the insurance business or tends to create a monopoly.
(b) A person otherwise qualified may be director of two or more insurers that are competitors, unless the effect is to lessen substantially competition between insurers generally or tends materially to create a monopoly.
(a) An insurance policy that provides coverage only against property damage to a motor vehicle and that does not provide liability coverage required under AS 28.22.101 (d) must contain the following statement printed in bold face type: 'This policy provides insurance only against damage to the motor vehicle. This policy does not insure against bodily injury, death, or property damage liability and does not satisfy the mandatory motor vehicle liability insurance requirements of AS 28.22.011.'
(b) If the insured under a policy described in (a) of this section is not the owner of the motor vehicle, the insurer shall provide a copy of the policy to the owner.
(a) An insurer or licensee that has reason to believe that a fraudulent claim has been made against it shall send the director a report disclosing information that the director may require.
(b) An insurer or licensee that has reason to believe that an insurance producer with which it is doing business is involved in a defalcation, embezzlement, or violation of the provisions of AS 21.36.360 shall immediately send the director a report disclosing the basis for that belief and any other information that the director may require.
(c) An insurer or licensee, its employee or agent, or another person acting in good faith is not civilly liable for damages resulting from the filing of the report or the furnishing of information required by this section or by the director.
(d) The director shall investigate facts reported under this section and shall refer facts indicating a violation of law to the appropriate prosecutor or agency.
(a) The papers, reports, documents, and evidence received under AS 21.36.390 or an investigation arising out of information received under AS 21.36.390 are not subject to public inspection for so long as the director considers confidentiality to be in the public interest or reasonably necessary to complete an investigation or protect the person investigated from unwarranted injury. Papers, reports, documents, and evidence relative to an investigation under this section are confidential and not subject to subpoena unless, after notice to the director and a hearing, a court determines the director would not be unduly hindered by public inspection.
(b) An investigator of the director is not subject to subpoena in a civil action by a court of this state to testify concerning a matter that the investigator has knowledge of under a pending insurance fraud investigation by the director.
Except as otherwise expressly provided by law, a person may not knowingly permit or offer to make or make a contract of life insurance, life annuity or health insurance, or agreement under the contract other than as plainly expressed in the contract, or pay, allow, give or offer to pay, allow, or give, directly or indirectly, as inducement to the insurance, or annuity, a rebate of premiums payable on the contract, or a special favor or advantage in the dividends or other benefits, or paid employment or contract for services of any kind, or any valuable consideration or inducement whatever not specified in the contract; or directly or indirectly give, sell, purchase or offer to agree to give, sell, purchase, or allow as inducement to the insurance or annuity or in connection therewith, whether or not to be specified in the policy or contract, an agreement of any form or nature promising returns, profits, stocks, bonds, or other securities, or interest present or contingent in the contract or as measured by the contract, of an insurance company or other corporation, association, or partnership, or dividends or profits accrued or to accrue under the contract; or offer, promise, or give anything of value that is not specified in the contract.
In the sale of insurance by a financial institution, a person may not engage in any practice or use an advertisement that may tend to mislead or deceive a consumer or cause a consumer to erroneously believe that
(1) the insurance is backed by or a return on the insurance is guaranteed by the state, the federal government, the person, or the Federal Deposit Insurance Corporation;
(2) the state or federal government
(A) will pay a claim under an insurance contract that is an obligation of or was sold by the person;
(B) is responsible for the insurance sales activities of the person; or
(C) guarantees the credit of the person;
(3) for insurance that contains investment risk, the insurance does not contain investment risk, the principal may not be lost, or the value of the insurance may not decline;
(4) the lending of money, extension of credit, or a renewal of a loan is conditioned on the purchase of insurance from the person and that insurance may not be purchased from another source.
A person licensed under AS 21.27 may not
(1) enter into any insurance transaction in which the premium is financed by other than the licensee unless the person providing the financing is licensed under and in compliance with AS 06.40 or is exempted from licensure under AS 06.40.020 ; or
(2) finance premiums or extend credit to persons purchasing insurance except as provided in regulations adopted by the director; the director shall adopt regulations establishing the conditions under which licensees may extend credit or finance premiums except that in no event may the regulations permit a rate of interest on amounts lent or credit extended greater than that provided in AS 06.40.120 .
An insurer may only fail to renew a personal insurance policy on the policy's annual anniversary. An insurer may not fail to renew a policy unless a written notice of nonrenewal is mailed to the named insured as required by AS 21.36.260 at least 20 days for a personal insurance policy, and at least 45 days for a business or commercial insurance policy, before the expiration date of the policy or of the anniversary date of a policy written for a term longer than one year or with no fixed expiration date. If notice of nonrenewal is not given as required by this section, the existing policy shall continue until the insurer provides notice for the time period required by this section for that policy. This section does not apply
(1) if the insurer has in good faith manifested its willingness to renew;
(2) in case of nonpayment of premium for the expiring policy;
(3) if the insured fails to pay the premium as required by the insurer for renewal; or
(4) to business or commercial policies placed under AS 21.34.
(a) Except as provided in AS 21.36.305 , if the renewal premium is increased more than 10 percent for a reason other than an increase in coverage or exposure base, or if after renewal there will be a material restriction or reduction in coverage not specifically requested by the insured, written notice shall be mailed to the insured and to the agent or broker of record as required by AS 21.36.260
(1) at least 20 days before expiration of a personal insurance policy; or
(2) at least 45 days before expiration of a business or commercial policy.
(b) If notice before expiration of the policy is not given as required by (a) of this section, the existing policy shall continue until the insurer provides notice for the time period required by (a) of this section for that policy.
(c) This section does not apply to workers' compensation insurance or to business or commercial policies issued under AS 21.34.
In AS 21.36.430 - 21.36.440, 'insurer' includes
(1) an insurer, as defined in AS 21.90.900 ;
(2) a group health plan, as defined in 29 U.S.C. 1167(1) (Employee Retirement Income Security Act of 1974);
(3) a health maintenance organization, as defined in AS 21.86.900 ;
(4) a hospital service corporation or medical service corporation, as defined in AS 21.87.330 ;
(5) the Comprehensive Health Insurance Association, established in AS 21.55.010; and
(6) an entity offering a service benefit plan, as referred to in 42 U.S.C. 1396g-1.
21.36.169, unless the context otherwise requires,(1) 'consumer' means a person who obtains, applies to obtain, or is solicited to obtain insurance from or on behalf of a financial institution;
(2) 'financial institution' means a bank holding company under 12 U.S.C. 1841 (Bank Holding Company Act of 1956); a credit union under 12 U.S.C. 1752 (Federal Credit Union Act); a bank, savings bank, savings and loan association, or trust company, or any depository institution under 12 U.S.C. 1813(c)(1); and any other person authorized to take federally insured deposits and make loans in the state; 'financial institution' includes any employee or agent of a financial institution and any nondepository affiliate or subsidiary of a financial institution but only in the instances when the nondepository affiliate or subsidiary is soliciting the sale or purchase of insurance recommended or sponsored by, on the premises of, or in connection with a product offering of the financial institution; 'financial institution' does not include an insurer.
(a) If an insurance policy is cancelled, rejected, or rescinded by the
(1) insurer, the insurer shall return or credit any unearned premium paid to the agent or broker of record, or directly to the insured or premium finance company, if applicable; or
(2) insured, the insurer shall return or credit any unearned premium to the agent or broker of record or directly to the insured or premium finance company, if applicable, less a cancellation fee not to exceed 7.5 percent of the unearned premium; a cancellation fee may not be charged unless the fee is clearly stated in the policy; the insurer shall return or credit the unearned premium less a lawful cancellation fee
(A) within 45 days of receipt of the request for cancellation or the effective date of cancellation, whichever is later; or
(B) if the policy is selected for audit, within 45 days of completion of an audit; the insurer shall perform and complete an audit within 45 days of receipt of the request for cancellation or the effective date of cancellation, whichever is later.
(b) Notwithstanding (a) of this section, if the insurer clearly indicates one or more of the following features in the policy, an insurer may issue a policy
(1) whose premium is earned at a varying rate due to seasonality of exposure;
(2) that contains a minimum earned premium; or
(3) with a fluctuating premium base.
(a) A person may not represent, directly or indirectly, to be a financial planner, investment adviser, consultant, financial counselor, or similar specialist engaged in the business of giving financial planning or advice relating to investments, insurance, real estate, tax matters, or trust and estate matters when the person is in fact only engaging in the sale of insurance.
(b) A person may not engage in the business of financial planning and solicit the sale of a product or service on the basis that the person is an insurance salesperson or that a commission for the sale of an insurance product will be received in addition to a fee for financial planning without full disclosure to the client before the execution of the agreement required in (c) of this section.
(c) A person licensed under this title may not charge a fee other than a commission for financial planning unless the fee is based upon a written agreement signed before the performance of a service under the agreement. The insurance salesperson shall provide the client a copy of the signed agreement at the time of signing. The agreement must specifically state the service for which a fee is to be charged and how the fee will be determined or calculated. The agreement must provide that the client is under no obligation to purchase an insurance product. The licensee shall retain a copy of the agreement for not less than five years after completion of services and the agreement shall be available to the director upon request.
(a) A property, casualty, or surety insurer or its employee or representative, or an agent, or solicitor may not pay, allow, give, or offer to pay, allow, or give, directly or indirectly, as an inducement to insurance or after insurance has been effected, a rebate, discount, abatement, credit, or reduction of the premium named in the policy of insurance, or a special favor or advantage in the dividends or other benefits to accrue thereon, or any valuable consideration or inducement, not specified in the policy, except to the extent provided for in an applicable filing with the director as provided by law.
(b) An insured named in a policy, or an employee of the insured may not knowingly receive or accept directly or indirectly, a rebate, discount, abatement, credit, or reduction of premium, or special favor or advantage or valuable consideration or inducement.
(c) An insurer may not make or permit an unfair discrimination between insureds or property having like insuring or risk characteristics, in the premium or rates charged for insurance, or in the dividends or other benefits payable thereon, or in any other of the terms and conditions of the insurance.
(d) Nothing in this section may be construed as prohibiting the payment of commissions or other compensation to persons duly transacting business under AS 21.27, or as prohibiting an insurer from allowing or returning to its participating policyholders, members, or subscribers, lawful dividends, savings, or unabsorbed premium deposits.
Nothing in AS 21.36.090 and 21.36.100 may be construed as including within the definition of discrimination or rebates any of the following practices:
(1) in the case of a contract of life insurance or life annuity, paying bonuses to policyholders or otherwise abating their premiums in whole or in part out of surplus accumulated from nonparticipating insurance, if the bonuses, or abatement of premiums are fair and equitable to policyholders and for the best interests of the insurer;
(2) in the case of life insurance policies issued on the industrial debit, preauthorized check, bank draft, or similar plans, making allowance to policyholders who have continuously for a specified period made premium payments directly to an office of the insurer or by preauthorized check, bank draft, or similar plan, in an amount that fairly represents the saving in collection expense;
(3) readjustment of the rate of premium for a group insurance policy based on the loss or expense experience thereunder, at the end of the first or a subsequent policy year of insurance thereunder, which may be made retroactive only for that policy year;
(4) issuance of life or health insurance policies or annuity contracts at rates less than the usual rates of premiums for the policies or contracts, or modification of premium or rate based on amount of insurance; but the issuance or modification shall not result in reduction in premium or rate in excess of savings in administration and issuance expenses reasonably attributable to the policies or contracts.
(a) An insurer may not increase the premium on a personal automobile insurance policy unless the increase applies to all insureds of the same class.
(b) An insurer may not increase the premium or add a surcharge to a personal automobile insurance policy because of the issuance of a citation for a moving traffic violation unless the insured or another person who resides in the insured's household and is covered by the policy has been convicted of the violation or has entered a plea of no contest to the violation.
(c) The director shall adopt regulations to determine circumstances under which an insurer may increase the premium or add a surcharge to a personal automobile insurance policy.
(d) An insurer that increases the premium or adds a surcharge to a personal automobile insurance policy may only make the increase or surcharge effective on the renewal date of the policy.
(e) An insurer that increases the premium or adds a surcharge to a personal automobile insurance policy shall give written notice of the increase or surcharge at least 20 days before it takes effect, stating the reason for the change and the right of appeal under AS 21.39.090 . This subsection does not apply to
(1) premium increase resulting from a change requested by an insured, if the insured is notified at the time the request is made that the amount of the insured's premium will change as a result of the requested policy change; or
(2) rate approved by the director if the insurer gives written notice of a premium increase to the insured at least 20 days before the renewal date of the affected policy.
(a) A person transacting insurance in this state may not (1) refuse to issue or renew insurance coverage; (2) limit the scope of insurance coverage; (3) cancel an existing policy of insurance; (4) deny a covered claim; or (5) increase the premium on an insurance policy if the refusal, cancellation, denial, or increase results only from the fact that the person was a victim of domestic violence or a provider of services to victims of domestic violence.
(b) The provisions of (a) of this section may not prevent an insurer from underwriting or rating
(1) for a medical condition, including a medical condition resulting from domestic violence, in the same manner as it would for a person who is not a victim of domestic violence; or
(2) a person based on known frequency of losses in the same manner the insurer would for a person who is not a victim of domestic violence.
(c) In this section, 'domestic violence' means the occurrence of one or more of the following by a current or former family member, household member, intimate partner, or caretaker:
(1) attempting to cause, causing, or threatening another person with physical harm, severe emotional distress, psychological trauma, rape, or sexual assault;
(2) engaging in a course of conduct or repeatedly committing acts toward another person, including following the person without proper authority, under circumstances that place the person in reasonable fear of bodily injury or physical harm;
(3) subjecting another person to false imprisonment; or
(4) attempting to cause or causing damage to property so as to intimidate or attempt to control the behavior of another person.
(a) A person may not make, issue, circulate, broadcast, or have made, issued, circulated, or broadcast an estimate, circular, statement, illustration, comparison, or other written or oral presentation that
(1) misrepresents the benefits, advantages, conditions, sponsorship, source, or terms of an insurance policy;
(2) misrepresents the dividends or share of the surplus to be received on an insurance policy;
(3) misrepresents an insurance policy as being a share or shares of stock;
(4) makes a false or misleading statement as to the dividends or shares of the surplus previously paid on an insurance policy;
(5) misrepresents or makes a misleading statement as to the financial condition of an insurer or as to the legal reserve system upon which a life insurer operates;
(6) uses a name or title of an insurance policy or class of insurance policies misrepresenting its true nature;
(7) is a misrepresentation for the purpose of inducing, or that tends to induce the lapse, forfeiture, exchange, conversion, or surrender of an insurance policy;
(8) is a misrepresentation for the purpose of effecting or tending to effect a pledge or assignment of or loan against an insurance policy;
(9) appears to be an actual policy for a named individual when it is merely an advertisement;
(10) does not clearly designate the name of the insurer providing the coverage or about which the statements are made; or
(11) is in any other way misleading, false, or deceptive.
(b) In this section, 'misrepresentation' includes any statement or omission of a statement that when taken in the context of the whole presentation may tend to mislead or deceive the person or persons addressed.
(a) An insurer, whether an authorized or unauthorized insurer, may not make available through a rating plan or form, property, casualty, or surety insurance to a firm, corporation, or association of individuals, a preferred rate or premium based upon a fictitious group of the firm, corporation, or association of individuals.
(b) A form or plan of insurance covering a group or combination of persons or risks may not be written or delivered inside or outside this state to cover persons or risks in this state at a preferred rate or on a form other than that offered to persons not in the group or combination and to the public generally, unless the form, plan of insurance, and the rates or premiums to be charged have been submitted to and approved by the director as being not unfairly discriminatory and not otherwise in conflict with (a) of this section or with AS 21.39 to the extent that AS 21.39 is, by its terms, applicable to it.
(c) This section does not apply to mortgage guaranty insurance, life insurance, health insurance, or annuity contracts.
(d) This section does not apply to workers' compensation insurance when issued to an association of employers formed for purposes other than the purchase of insurance and that
(1) has a constitution and bylaws;
(2) incorporates a safety program;
(3) as a group has preferred characteristics over similar risks written on an individual basis; and
(4) has filed and received approval from the director for the rating program to be applied to the group.
(e) This section does not apply to insurance coverage under a joint insurance arrangement authorized by AS 21.76.
(a) A person may not make or permit unfair discrimination between individuals of the same class and equal expectation of life in the rates charged for a contract of life insurance or of life annuity or in the dividends or other benefits payable thereon, or in any other of the terms and conditions of the contract.
(b) A person may not make or permit unfair discrimination between individuals of the same class and of essentially the same hazard in the amount of premium, policy fees, or rates charged for a policy or contract of health insurance or in the benefits payable, or in any of the terms or conditions of the contract, or in any other manner whatever.
(c) A person may not make or permit arbitrary or unfair discrimination between insureds or property having like insuring or risk characteristics, in the premium or rates charged for a policy or contract of property, casualty, surety, marine, wet marine or transportation insurance, or in the dividends or other benefits payable on the insurance, or in the selection of it, or in any other of the terms and conditions of the insurance.
(d) Except to the extent necessary to comply with AS 21.42.365 and AS 21.56, a person may not practice or permit unfair discrimination against a person who provides a service covered under a group health insurance policy that extends coverage on an expense incurred basis, or under a group service or indemnity type contract issued by a health maintenance organization or a nonprofit corporation, if the service is within the scope of the provider's occupational license. In this subsection, 'provider' means a state licensed physician, physician assistant, dentist, osteopath, optometrist, chiropractor, nurse midwife, advanced nurse practitioner, naturopath, physical therapist, occupational therapist, marital and family therapist, psychologist, psychological associate, licensed clinical social worker, or certified direct-entry midwife.
(a) If the director believes that a person engaged in the insurance business is engaging in this state in an unfair method of competition or in an unfair or deceptive act or practice in the conduct of the business that is not defined as being unfair or deceptive under this chapter, the director shall hold a hearing on the matter, if the director believes it would be in the public interest to do so after giving notice of the hearing and of the charges. Upon conclusion of the hearing the director shall make a written report of the findings of fact relative to the charges and serve a copy upon the person and any intervenor at the hearing.
(b) If the report charges a violation of this chapter and if the method of competition, act, or practice has not been discontinued, the director may, through the attorney general of this state, at any time after the service of the report, cause an action to be instituted to enjoin and restrain the person from engaging in the method, act, or practice. In the action the court may grant a restraining order or injunction upon just terms, but the state may not be required to give security before the issuance of the order or injunction. If a record of the proceedings in the hearing before the director was made, a certified transcript, including all evidence taken and the report and findings, shall be received in evidence in the action.
(c) If the director's report made under (a) of this section, or order on hearing made under AS 21.36.320 does not charge a violation of this chapter, an intervenor in the proceedings may appeal from the order or report within the time and in the manner provided for appeals from the director generally.
(d) In addition to the unfair methods and unfair or deceptive acts or practices expressly defined in this title, the director may adopt regulations to define other methods of competition and other acts and practices related to the business of insurance that are unfair or deceptive.
(a) A person may not
(1) require, as a condition to the lending of money or extension of credit, or a renewal of the loan or extension of credit, that the obligee of the money or credit negotiate a policy or contract of insurance through any particular person or group of persons;
(2) disapprove the insurance policy provided by a borrower for the protection of property securing credit or a loan if disapproval is based on other than reasonable standards uniformly applied and relating to the extent of coverage required and the financial soundness and the services of the insurer; the standards may not discriminate against a particular type of insurer or call for the disapproval of a policy containing coverage in addition to that required;
(3) unless charges are required when the person handling the insurance transaction is a licensee, require a consumer, insurer, broker, or agent to pay a separate charge for handling an insurance policy required as security for a loan on real property, or to pay a separate charge to substitute the insurance policy of one insurer for that of another, except that interest may be charged on premium loans or premium advancements in accordance with the security instrument.
(b) A person shall
(1) use separate documents for an insurance transaction, other than credit insurance or flood insurance, and for a credit transaction; and
(2) maintain separate and distinct records relating to insurance transactions, including consumer complaint information, and make the records available to the director for inspection upon notice.
(c) A person may not include insurance premiums in a primary credit transaction without the consent of the consumer.
(d) Nothing in this section prohibits a person from informing a consumer or prospective consumer that insurance is required in order to obtain a loan or credit, that loan or credit approval is contingent on the procurement of acceptable insurance by the consumer, or that insurance is available from the person.
(a) An insurer may not exercise its right to cancel a policy of personal automobile insurance except for the following reasons:
(1) nonpayment of premium; or
(2) the driver's license or motor vehicle registration of either the named insured or of an operator who resides in the same household as the named insured or who customarily operates a motor vehicle insured under the policy has been under suspension or revocation during the policy period or, if the policy is a renewal, during its policy period or the 180 days immediately preceding its effective date; this paragraph does not apply to revocation as described under AS 21.89.027 .
(b) During the policy period, a modification of automobile physical damage coverage, except coverage for loss caused by collision, whereby provision is made for the application of a deductible amount not exceeding $100 is not a cancellation of the coverage or of the policy.
(c) [Repealed, Sec. 47 ch 29 SLA 1987].
(d) This section does not apply to
(1) the failure to renew a policy, except as to coverage in force for less than 12 months;
(2) a policy that has been in effect less than 60 days at the time notice of cancellation is mailed or delivered by the insurer, unless it is a renewal policy.
(e) [Repealed, Sec. 47 ch 29 SLA 1987].
(f) An insurer may not exercise its right to cancel a policy of personal insurance other than personal automobile insurance, except for the following reasons:
(1) nonpayment of premiums, including nonpayment of additional premiums, calculated in accordance with the current rating manual of the insurer, justified by a physical change in the insured property or a change in its occupancy or use;
(2) conviction of the insured of a crime having as one of its necessary elements an act increasing a hazard insured against;
(3) discovery of fraud or material misrepresentation made by the insured or a representative of the insured in obtaining the insurance or by the insured in pursuing a claim under the policy;
(4) discovery of a grossly negligent act or omission by the insured that substantially increases the hazards insured against; or
(5) physical changes in the insured property that result in the property becoming uninsurable.
(1) 'business or commercial insurance' means insurance other than personal insurance, reinsurance, life insurance, health insurance, fidelity and surety insurance, title insurance, or an annuity contract;
(2) 'nonpayment of premium' means failure of the named insured to discharge when due any obligations of the named insured in connection with the payment of premium on a policy, or any installment of the premium, whether the premium is payable directly to the insurer or its agent or indirectly under any premium finance plan or extension of credit;
(3) 'personal automobile insurance' means insurance not related to business or commercial activities, covering automobile liability, uninsured or underinsured motorists, automobile medical payments, or automobile physical damage, that is delivered or issued for delivery in this state, and under which the insured vehicles are of the following types only:
(A) a motor vehicle of the private passenger or station wagon type that is not used as a public or livery conveyance, nor rented to others; or
(B) any other four-wheel motor vehicle with a load capacity of 1,500 pounds or less that is not used in the occupation, profession, or business of the insured, nor used as a public or livery conveyance, nor rented to others;
(4) 'personal insurance'
(A) means personal automobile insurance, or insurance covering
(i) loss of or damage to real property that is used predominantly for residential purposes and that does not consist of more than four dwelling units;
(ii) loss of or damage to personal property, including personal effects, household furniture, fixtures, and equipment located in not more than four dwelling units; or
(iii) legal liability of natural persons for loss of, damage to, or injury to persons or property if the insurance does not cover liability arising from or in connection with business or commercial activities;
(B) does not include an annuity contract or a policy of life insurance, health insurance, or title insurance;
(5) 'renewal' or 'renew' means
(A) the issuance and delivery of an insurance policy at the end of the policy period, that replaces a policy previously issued and delivered by the same insurer;
(B) the issuance and delivery of a certificate or notice extending the term of a policy beyond its policy period or term; or
(C) the extension of the term of a policy beyond its policy period or term under a provision for extending the policy by payment of a continuation premium.
(a) A person may not commit any of the following acts or practices:
(1) misrepresent facts or policy provisions relating to coverage of an insurance policy;
(2) fail to acknowledge and act promptly upon communications regarding a claim arising under an insurance policy;
(3) fail to adopt and implement reasonable standards for prompt investigation of claims;
(4) refuse to pay a claim without a reasonable investigation of all of the available information and an explanation of the basis for denial of the claim or for an offer of compromise settlement;
(5) fail to affirm or deny coverage of claims within a reasonable time of the completion of proof-of-loss statements;
(6) fail to attempt in good faith to make prompt and equitable settlement of claims in which liability is reasonably clear;
(7) engage in a pattern or practice of compelling insureds to litigate for recovery of amounts due under insurance policies by offering substantially less than the amounts ultimately recovered in actions brought by those insureds;
(8) compel an insured or third-party claimant in a case in which liability is clear to litigate for recovery of an amount due under an insurance policy by offering an amount that does not have an objectively reasonable basis in law and fact and that has not been documented in the insurer's file;
(9) attempt to make an unreasonably low settlement by reference to printed advertising matter accompanying or included in an application;
(10) attempt to settle a claim on the basis of an application that has been altered without the consent of the insured;
(11) make a claims payment without including a statement of the coverage under which the payment is made;
(12) make known to an insured or third-party claimant a policy of appealing from an arbitration award in favor of an insured or third-party claimant for the purpose of compelling the insured or third-party claimant to accept a settlement or compromise less than the amount awarded in arbitration;
(13) delay investigation or payment of claims by requiring submission of unnecessary or substantially repetitive claims reports and proof-of-loss forms;
(14) fail to promptly settle claims under one portion of a policy for the purpose of influencing settlements under other portions of the policy;
(15) fail to promptly provide a reasonable explanation of the basis in the insurance policy in relation to the facts or applicable law for denial of a claim or for the offer of a compromise settlement; or
(16) offer a form of settlement or pay a judgment in any manner prohibited by AS 21.89.030 ;
(17) violate a provision contained in AS 21.07.
(b) The provisions of this section do not create or imply a private cause of action for a violation of this section.
(a) In the sale of insurance by a financial institution, a person shall disclose both orally and in writing to a consumer before the initial purchase of insurance that
(1) the insurance is not a deposit or other obligation of the person;
(2) the insurance is not guaranteed by the person or the person soliciting insurance;
(3) the insurance is not insured by the Federal Deposit Insurance Corporation or other agency of the United States, the financial institution, or the person;
(4) if the insurance contains risk, the insurance contains investment risk and the insurance may lose value;
(5) the consumer is not required to negotiate a policy or contract of insurance through any particular person or group of persons as a condition to the lending of money or extension of credit, or a renewal of the loan or extension of credit, except that the person may impose reasonable requirements uniformly applied and relating to the extent of coverage required and the financial soundness and the services of the insurer and that the standards may not discriminate against a particular type of insurer or require disapproval of a policy containing coverage in addition to that required.
(b) A person shall also provide the disclosures required in (a) of this section to a consumer both orally and in writing at the time of application for an extension of credit.
(c) If an application for insurance is made by telephone, written disclosure as required in (a) of this section must be mailed to the consumer within three working days.
(d) A person may provide the disclosures required in (a) of this section electronically, if
(1) the consumer affirmatively consents to electronic disclosure; and
(2) the disclosures are provided in a format that the consumer is able to access at a later time by a method such as through printing or storing the disclosures electronically.
(e) A person shall provide the disclosures required in (a) of this section in a meaningful form and in a conspicuous, simple, direct, and understandable manner that is designed to call attention to the information provided.
(f) A person shall obtain a written acknowledgment or, in the case of an electronic disclosure provided in compliance with (d) of this section, a written or electronic acknowledgment, by the consumer that the consumer received the disclosures as required in this section.
(g) This section does not require that a person provide the disclosures required in this section in advertisements that are of a general nature or that describe or list the services or products offered by a financial institution or on behalf of a financial institution.
(h) In this section, 'meaningful form' means
(1) for other than an electronic form, a form of disclosure that is provided to a consumer orally and in writing;
(2) for an electronic form, a disclosure that a consumer cannot electronically bypass before purchasing insurance.
(a) On the complaint of a person or on the motion of the director, the director may conduct an investigation to determine whether a person is engaged in an unfair method of competition or unfair or deceptive act or practice prohibited by this chapter.
(b) If there are grounds for believing that a person is engaged in an act or practice prohibited by this chapter, the director may institute proceedings under AS 21.06.170 - 21.06.240.
(c) If the director determines that a person violated this chapter, the director shall serve upon the person charged an order requiring that person to cease and desist from engaging in the act or practice.
(d) In addition to an order issued under (c) of this section, the director may, after a hearing, order restitution, assess a penalty of not more than $2,500 for each violation or $25,000 for engaging in a general business practice in violation of this chapter.
(e) If the director determines after a hearing that the person charged knew or should have known that the person was in violation of this chapter, in addition to the penalty prescribed in (d) of this section, a suspension or revocation of the person's license and a penalty of not more than $25,000 for each violation or $250,000 for engaging in the general business practice in violation of this chapter may also be ordered by the director.
(f) If the director believes that a person has violated a cease and desist order issued under (c) of this section, the director may certify the relevant facts to the superior court in the appropriate district, for proceedings under AS 44.62.590 . In addition to the penalties and remedies provided for in AS 44.62.590 , the superior court, upon finding that the cease and desist order has been violated, may order the violator to comply with the order, pay an additional penalty of not more than $1,000,000 for each violation, may revoke or suspend the violator's license, and may bar the violator from transacting the business of insurance in the future.
(g) In determining the penalty imposed under (d) and (e) of this section, the director shall consider the amount of loss or harm caused by the violation and the amount of benefit derived by the person by reason of the violation and may consider other factors, including the seriousness of the violation, the promptness and completeness of remedial action, whether the violation was a single act or a trade practice, and deterrence of the violator or others.
(h) If the violation is a single act prohibited under AS 21.36.125 that results in loss or harm, the director may require restitution or issue a cease and desist order but may not impose a penalty that includes a fine or require other remedial action, unless the violation results in loss or harm and is intentional. This subsection does not affect the director's authority to impose a penalty for multiple acts prohibited under AS 21.36.125 or a penalty for an act prohibited under a provision of law other than AS 21.36.125 .
(a) A health care insurer may not deny enrollment of a child under the health care insurance of the child's parent on the ground that the child
(1) was born out of wedlock;
(2) is not claimed as a dependent on the parent's federal income tax return;
(3) does not reside with the parent; or
(4) does not reside in the health care insurer's service area.
(b) If a parent is required under AS 25.27.020 (a)(9) or 25.27.060(c) to provide medical support for a child and the parent is eligible for family health care insurance coverage through an insurer, the parent's health care insurer
(1) shall allow the parent to enroll the child under the family health care insurance coverage without regard to restrictions relating to enrollment periods if the child is otherwise eligible;
(2) shall, if the parent fails to apply for enrollment of a child under (1) of this subsection, enroll the child under the parent's family health care insurance coverage upon application by the child's other parent or custodian, the child support services agency, or the Department of Health and Social Services; and
(3) may not disenroll or eliminate health care insurance coverage of the child unless the insurer has received written evidence that
(A) the parent with the insurance coverage is no longer required by court order or administrative order to provide the child's medical support; or
(B) the child is or will be enrolled in comparable health care insurance coverage through another insurer that will take effect not later than the effective date of the disenrollment or elimination of coverage.
(c) A health care insurer who provides health care insurance coverage of a child through family health care insurance coverage of a parent who does not have sole physical custody of the child shall
(1) provide to the child's other parent or custodian the information that may be necessary for the child to obtain benefits through the family health care insurance coverage;
(2) allow the child's other parent or custodian, or the child's health care provider with the parent's or custodian's approval, to submit claims for covered services without the approval of the parent whose health care insurance covers the child; and
(3) make payment on claims submitted under (2) of this subsection directly to the child's other parent or custodian, the health care provider, or a state agency to which the child's medical support rights have been assigned under AS 25.27.120 or AS 47.07.025 .
(d) If an individual is covered for health benefits from an insurer, the insurer may not impose requirements on a state agency to which the rights of the individual under AS 25.27.120 or AS 47.07.025 have been assigned that are different from requirements applicable to an agent or assignee of other individuals covered by the insurer.
(e) In this section, 'health care insurer' has the meaning given in AS 21.54.500 and includes the Comprehensive Health Insurance Association as described in AS 21.55.010 .
(a) An insurer may not exercise its right to cancel a personal insurance policy unless, for a named insured who is
(1) less than 70 years of age, a written notice of cancellation is mailed to the named insured as required by AS 21.36.260 at least 30 days before the effective date of cancellation; however, if cancellation is for nonpayment of premium, the notice shall be mailed to the named insured as required by AS 21.36.260 at least 20 days before the effective date of cancellation, and, if cancellation is for a reason described in AS 21.36.210 (a)(2), (f)(2), or (f)(3), the notice shall be mailed to the named insured as required by AS 21.36.260 at least 10 days before the effective date of cancellation; and
(2) 70 years of age or older, a written notice of cancellation is mailed to the named insured and, if the named insured has made a written request to the insurer, to the named insured's designee as required by AS 21.36.260 at least 30 days before the effective date of cancellation; however, if cancellation is for nonpayment of premium, the notice shall be mailed to the named insured and, if the named insured has made a written request to the insurer, to the named insured's designee as required by AS 21.36.260 at least 20 days before the effective date of cancellation, and, if cancellation is for a reason described in AS 21.36.210 (a)(2), (f)(2), or (f)(3), the notice shall be mailed to the named insured and, if the named insured has made a written request to the insurer, to the named insured's designee as required by AS 21.36.260 at least 10 days before the effective date of cancellation; an insurer who provides a personal insurance policy to an insured who is 70 years of age or older shall annually give written notice to the insured of the insured's right to have a designee receive notice as provided in this paragraph.
(b) An insurer may not exercise its right to cancel a policy of business or commercial insurance unless a written notice of cancellation is mailed to the named insured as required by AS 21.36.260 and to the agent or broker of record at least 60 days before the effective date of cancellation. However, if cancellation is for nonpayment of premium, or for failure or refusal of the insured to provide the information necessary to confirm exposure or necessary to determine the policy premium, the notice shall be mailed to the named insured as required by AS 21.36.260 and to the agent or broker of record at least 20 days before the effective date of cancellation. If cancellation is (1) for conviction of the insured of a crime having as one of its necessary elements an act increasing a hazard insured against, or (2) for discovery of fraud or material misrepresentation made by the insured or a representative of the insured in obtaining the insurance or by the insured in pursuing a claim under the policy, the notice shall be mailed to the named insured as required by AS 21.36.260 and to the agent or broker of record at least 10 days before the effective date of cancellation.
(c) If an insurer cancels a policy under this section, it shall return or credit any unearned premium to the agent or broker of record or directly to the insured or premium finance company, if applicable, before the effective date of cancellation, except that
(1) an unearned premium shall be returned or credited within 45 days after notice of cancellation is given, if cancellation is for
(A) nonpayment of premium, including nonpayment of additional premiums, calculated in accordance with the current rating manual of the insurer, justified by a physical change in the insured property, a change in its occupancy or use, or a change in payroll, receipts, values, or other exposure units;
(B) conviction of the insured of a crime having as one of its necessary elements an act increasing a hazard insured against;
(C) discovery of fraud or material misrepresentation made by the insured or a representative of the insured in obtaining the insurance or by the insured in pursuing a claim under the policy;
(D) failure or refusal of the insured to provide the information necessary to confirm exposure or necessary to determine the policy premium;
(E) a reason described in AS 21.36.210 (a)(2);
(2) the insurer shall perform or waive the audit before the effective date of the cancellation and return or credit any estimated unearned premium before the effective date of cancellation if the policy is subject to audit and is cancelled for a reason other than those described in (1)(A) - (D) of this subsection.
(d) The division may require an insurer to perform an audit that the insurer has elected to waive under (c) of this section.
(e) A notice of cancellation of insurance required to be given under this section must include or be accompanied by a statement of the reason for the cancellation.
(a) If an insurer writing personal insurance uses credit information in underwriting or rating a consumer, the insurer shall disclose, either on the insurance application or, at the time the insurance application is taken, that the insurer will obtain credit information in connection with the application. The disclosure required under this subsection shall be in writing or in the same medium as the application for insurance. Use of the following statement constitutes compliance with this subsection: 'In connection with this application for insurance, we will review your credit report or obtain or use a credit-based insurance score based on the information contained in your credit report. We may use this information to decide whether to insure you or how much to charge.' If an insurer uses a third party to calculate the applicant's insurance score, the disclosure required under this subsection must also contain language similar to: 'We may use a third party in connection with the development of your insurance score.'
(b) An insurer that takes adverse action involving personal insurance against a consumer based in whole or in part on credit history or insurance score shall provide the consumer the opportunity to request reconsideration of the adverse action and provide written notice to the applicant or named insured. The notice must
(1) clearly and specifically state the significant factors of the credit history or insurance score that resulted in the adverse action, in a manner that allows the consumer to identify the basis for the adverse action;
(2) inform the consumer that the consumer is entitled to
(A) request reconsideration of the adverse action; and
(B) a free copy of the consumer's report under 15 U.S.C. 1681 et seq. (Fair Credit Reporting Act);
(3) inform the consumer that the consumer has the right to correct errors in the credit report;
(4) advise the consumer on ways to improve the consumer's insurance score; and
(5) provide information to assist the consumer with the error correction process.
(c) An insurer may use credit history to cancel, deny, underwrite, or rate personal insurance only in combination with other substantive underwriting factors. For the purposes of this subsection,
(1) refusal to offer personal insurance coverage to a consumer constitutes denial of personal insurance; and
(2) an offer of placement with an affiliate insurer does not constitute denial of coverage.
(d) An insurer may not
(1) fail to renew or, at renewal, again underwrite or rate a personal insurance policy based in whole or in part on a consumer's credit history or insurance score; the prohibition in this paragraph against underwriting or rating a personal insurance policy at renewal may be waived by the consumer; waiver allowed under this paragraph must occur at each renewal;
(2) cancel, deny, underwrite, or rate personal insurance coverage based in whole or in part on
(A) the absence of credit history or the inability to determine the consumer's credit history if the insurer has received accurate and complete information from the consumer; this subparagraph does not apply if the insurer treats the consumer as if the consumer had neutral credit information as approved by the director;
(B) credit inquiries not initiated by the consumer;
(C) credit inquiries relating to insurance coverage if identified on a consumer's credit report;
(D) credit inquiries by the consumer for the consumer's own credit information;
(E) multiple lender inquiries if coded on the consumer's credit report as being for automobile, boat, recreation vehicle, or home mortgage loans, unless all inquiries under that code within a 30-day period are counted as one;
(F) credit history or an insurance score based on collection accounts identified with a medical industry code;
(G) the consumer's use of a particular type of credit card, charge card, or debit card or the absence of a credit card;
(H) the consumer's total available line of credit; however, the consumer's ratio of debt to total available line of credit may be considered;
(I) the age of the most recent automobile or home loan obtained by the consumer; however, an insurer may consider the bill payment history or total number of loans; or
(J) the person's age when credit is established;
(3) use the credit history of the consumer when the consumer is adversely affected by a joint account owner who was the spouse of the consumer or a joint account owner who is the spouse of the consumer and who is a party to a divorce or dissolution action against the consumer; this paragraph applies only if the consumer provides written notice to the insurer that identifies the credit information that is adversely affected by the joint account owner; this paragraph does not prevent the use of credit history that is not identified by the consumer as required by this paragraph;
(4) use an insurance score that is calculated using the income, age, sex, address, zip code, census block, ethnic group, religion, marital status, or nationality of the consumer as a factor;
(5) use credit history to determine an insurance score if the history is obtained more than 90 days before the policy is issued;
(6) use an insurance score derived from an insurance scoring model to determine eligibility for an insurance payment plan; this paragraph does not prohibit the use of credit history to evaluate the ability of the consumer to make payments.
(e) If incorrect credit history is used to underwrite or rate personal insurance coverage and a consumer is charged higher premiums or offered less favorable policy terms due to the disputed credit history, the insurer shall reissue or rerate the policy retroactive to the effective date of the current policy term, and the policy, as reissued or rerated, shall provide premiums and policy terms the consumer would have been eligible for if accurate credit history had been used to underwrite or rate the policy. If an insurer determines that the insured has overpaid a premium, the insurer shall refund to the insured the amount of overpayment calculated back to the last 12 months of coverage or the actual policy period, whichever period is shorter. This subsection applies only if the consumer discovers the incorrect credit history within 12 months after the policy is issued, resolves the dispute as described under (f) of this section or under the process in 15 U.S.C. 1681 et seq. (Fair Credit Reporting Act), and notifies the insurer in writing that the dispute has been resolved.
(f) If the use of disputed credit history results in denial or cancellation of personal insurance coverage, an insurer shall reunderwrite the coverage without the use of credit information as a factor. This subsection applies only if, within 10 days following denial or cancellation, the consumer provides a reconsideration certification to the insurer that sets forth any items of the credit history that are disputed and that indicates that the consumer has initiated the dispute resolution process in 15 U.S.C. 1681 (Fair Credit Reporting Act) by requesting a copy of the consumer's credit report. An insurer's reconsideration certification form
(1) is subject to filing and approval by the director under AS 21.42.120; and
(2) shall be provided by an insurer to the consumer at the time of denial or cancellation.
(g) This section does not require an insurer to use credit history for any purpose.
(h) An insurer shall indemnify, defend, and hold the insurer's producers harmless from all liability, fees, and costs arising out of or relating to the actions, errors, or omissions of an insurance producer who obtains or uses credit information or insurance scores for an insurer if the insurance producer follows the instructions of or procedures established by the insurer and complies with any applicable law or regulation. This subsection does not provide a consumer or other insured with a cause of action that does not exist in the absence of this subsection.
(i) In this section,
(1) 'adverse action' has the meaning given in 15 U.S.C. 1681 et seq. (Fair Credit Reporting Act) and includes
(A) cancellation, denial, or failure to renew personal insurance coverage;
(B) charging a higher insurance premium for personal insurance than would have been offered if the credit history or insurance score had been more favorable, whether the charge is by
(i) application of a rating rule;
(ii) assignment to a rating tier that does not have the lowest available rates; or
(iii) placement with an affiliate company that does not offer the lowest rates available to the consumer within the affiliate group of insurance companies; or
(C) any reduction or adverse or unfavorable change in the terms of coverage or amount of personal insurance due to a consumer's credit history or insurance score; a reduction or adverse or unfavorable change in the terms of coverage occurs when
(i) coverage provided to the consumer is not as broad in scope as coverage requested by the consumer but available to other insureds of the insurer or any affiliate; or
(ii) the consumer is not eligible for benefits that are available through affiliate insurers;
(2) 'affiliate' has the meaning given in AS 21.22.200 ;
(3) 'consumer' means an individual policyholder or applicant for insurance;
(4) 'consumer report' has the meaning given in 15 U.S.C. 1681 et seq. (Fair Credit Reporting Act);
(5) 'credit history' means written, oral, or other communication of information by a consumer reporting agency bearing on a consumer's creditworthiness, credit standing, or credit capacity that is used or expected to be used, or collected in whole or in part, for the purpose of serving as a factor in determining personal insurance premiums or eligibility for coverage;
(6) 'insurance score' means a number or rating that is derived from an algorithm, computer application, model, or other process that is based in whole or in part on credit history;
(7) 'personal insurance' means
(A) private passenger automobile or motorcycle coverage;
(B) homeowner coverage, including mobile homeowner's, manufactured homeowner's, condominium owner's, and renter's coverage;
(C) dwelling property coverage;
(D) earthquake coverage for a residence or personal property;
(E) personal liability and theft coverage;
(F) personal property inland marine coverage;
(G) personal boat, watercraft, snowmobile, and recreational vehicle coverage; and
(H) umbrella insurance coverage.
(a) A person may not commit a fraudulent or criminal insurance act involving an insurance transaction that is subject to the provisions of this title. The penalty for a fraudulent or criminal insurance act described in this section is in addition to a civil penalty levied under this title.
(b) A fraudulent insurance act is committed by a person who, with intent to injure, defraud, or deceive
(1) collects a sum as premium or charge for insurance if the insurance has not been provided or is not in due course to be provided, subject to acceptance of the risk by the insurer, by an insurance policy authorized under this title;
(2) presents to an insurer a written or oral statement in support of a claim for payment or other benefit under an insurance policy, knowing that the statement contains false, incomplete, or misleading information concerning a matter material to the claim;
(3) assists or conspires with another to prepare or make a written or oral statement that is presented to an insurer in support of a claim for a benefit under an insurance policy, knowing that the statement contains false, incomplete, or misleading information concerning a matter material to the claim;
(4) wilfully collects as premium or charge for insurance a sum in excess of the premium or charge applicable to the insurance as specified in the policy by the insurer in accordance with the applicable classifications and rates approved by the director, or in cases where classifications and rates are not subject to approval, the premiums and charges applicable to the insurance as specified in the policy and fixed by the insurer;
(5) fails to make disposition of funds received or held or misappropriates funds received or held representing premiums or return premiums; or
(6) fails to pay its tax liability under this title when due.
(c) A fraudulent insurance act is committed by a person forming or proposing to form an insurer, an insurance holding corporation, a stock corporation to finance an insurer or insurance production, a corporation to manage an insurer, a corporation to be attorney in fact for a reciprocal insurer, or a syndicate for any of these purposes that advertises, or solicits or receives funds, agreement, stock subscription, or membership on account unless the person has applied for and has received from the director a solicitation permit as required by AS 21.69.
(d) A fraudulent insurance act is committed by a person who makes a false sworn statement that the person does not believe to be true as to matter material to an examination, investigation, or hearing of the division.
(e) A fraudulent insurance act is committed by a person if
(1) as to a matter material to an examination, investigation, or hearing by the division, the person makes two or more sworn statements that are irreconcilably inconsistent to the degree that one of them is necessarily false; and
(2) the person does not believe one of the statements to be true at the time the statement is made.
(f) A fraudulent insurance act is committed by a person who with intent to deceive, knowingly exhibits a false account, document, or advertisement, relative to the affairs of an insurer, a corporation, or syndicate of the kind described in AS 21.69.060 , formed or proposed to be formed.
(g) A fraudulent insurance act is committed by a person who wrongfully removes or attempts to remove records from the place where they are required to be kept under AS 21.69.390 (a) or who conceals or attempts to conceal records from the director.
(h) A fraudulent insurance act is committed by a person who deliberately perpetrates a fraud upon the director under AS 21.22.
(i) A criminal insurance act is committed by a person doing business in this state or relative to a subject resident, located, or to be performed in this state who knowingly
(1) writes, places, or causes to be written or placed in this state or relative to a subject resident, located, or to be performed in this state a policy, duplicate policy, or contract of insurance of any kind or character, or general or floating policy upon persons or property resident, situated, or located in this state, from or through a person not authorized to transact business under AS 21.27 or a risk retention group or purchasing group not registered under AS 21.89.090 ; or
(2) pays a commission or other form of remuneration to a person, firm, or organization for the writing or placing of insurance coverage in this state or relative to a subject resident, located, or to be performed in this state unless that person, firm, or organization is authorized under AS 21.27 to transact the kind or class of insurance written or placed, or, in the case of a risk retention group or purchasing group, is registered under AS 21.89.090 .
(j) A criminal insurance act is committed by a person in this state or relative to a subject resident, located, or to be performed in this state who acts as an insurance producer, managing general agent, third-party administrator, reinsurance intermediary broker, reinsurance intermediary manager, surplus lines broker, or independent adjuster without being licensed by the director as required under this title or as a risk retention group or purchasing group without being registered as required under AS 21.89.090 . A criminal insurance act is committed by an insurance producer, managing general agent, third-party administrator, reinsurance intermediary broker, reinsurance intermediary manager, or surplus lines broker who solicits or takes application for, procures, or places for others any insurance for which the person is not licensed as required under AS 21.27 or for which the license of the person has been suspended or revoked. A criminal insurance act is committed by a person in this state or relative to a subject resident, located, or to be performed in this state who acts as or on behalf of a risk retention group or a purchasing group that is not registered under AS 21.89.090 .
(k) A criminal insurance act is committed by an insurance producer, managing general agent, third-party administrator, reinsurance intermediary broker, reinsurance intermediary manager, or surplus lines broker who knowingly compensates or offers to compensate in any manner a person other than an insurance producer, managing general agent, third-party administrator, reinsurance intermediary broker, reinsurance intermediary manager, or surplus lines broker licensed as required under this title in this or another jurisdiction, for procuring or in any manner helping to procure applications for or to place insurance in this state. A criminal insurance act is committed by a person in this state or relative to a subject resident, located, or to be performed in this state who acts as or on behalf of a risk retention group or a purchasing group that is not registered under AS 21.89.090 . This subsection does not apply to the payment of compensation that is not contingent upon volume of business transacted in the form of salaries to the regular employees of the insurance producer, managing general agent, third-party administrator, reinsurance intermediary broker, reinsurance intermediary manager, or surplus lines broker.
(l) A criminal insurance act is committed by a person who has placed insurance with an unauthorized insurer and refuses to obey an order by the director to produce for examination all policies and other documents evidencing the insurance and the amount of premiums paid or agreed to be paid for the insurance.
(m) A criminal insurance act is committed by a director of a domestic stock or mutual insurer who votes for or concurs in a declaration or payment of a dividend to stockholders or members other than as authorized under AS 21.69.490 - 21.69.500.
(n) A criminal insurance act is committed by an agent, managing general agent, third-party administrator, reinsurance intermediary broker, reinsurance intermediary manager, or other representative of an insurer involved in the procuring or issuance of an insurance contract who intentionally fails to report to the insurer the exact amount of consideration charged as premium for the contract and to maintain records showing that information.
(o) A fraudulent insurance act is committed by a person who, with intent to injure, defraud, or deceive, knowingly makes a false or fraudulent statement or representation in or with reference to an application for insurance.
(p) A fraudulent insurance act is committed by a person who
(1) violates a provision of this title or a regulation issued under it;
(2) falsely makes, completes, or alters a certificate of insurance or other document relating to insurance;
(3) knowingly possesses a forged certificate of insurance or other document relating to insurance; or
(4) knowingly issues a forged certificate of insurance or other document relating to insurance.
(q) A fraudulent or criminal insurance act described in
(1) (b) of this section that is committed to obtain $10,000 or more is a class B felony;
(2) (c) or (d) of this section is a class B felony;
(3) (b) of this section that is committed to obtain $500 or more but less than $10,000 is a class C felony;
(4) (e), (f), (g), or (h), of this section is a class C felony;
(5) (b) of this section that is committed to obtain less than $500 is a class A misdemeanor;
(6) (i), (j), (k), (l), (m), or (n) of this section is a class A misdemeanor;
(7) (o) of this section is a class B misdemeanor;
(8) (p)(1) of this section is a class B misdemeanor unless another specific penalty is provided for the violation of the provision; and
(9) (p)(2) - (4) of this section may be prosecuted under AS 11.46.
(r) The director may adopt regulations to implement, define, and enforce this section.
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