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									                         PAMIC Harrisburg Report
                                                                   Friday, February 25, 2005

                         This week I had a lengthy meeting with Representative Steve Nickol (R-
 • Meeting with
                         Adams, York) in his Harrisburg offices. Representative Nickol is Vice
   Representative        Chairman of the House Insurance Committee and a close advisor of
   Nickol                Speaker Perzel. Topics discussed included producer compensation
                         disclosure, credit scoring, terrorism coverage, and tort reform. Other
 • Trial Lawyers         matters included in the PAMIC issues papers were also touched upon.
   Announce Agenda       Representative Nickol discussed the probable agenda of the Insurance
                         Committee in the coming session and how realistic are prospects for some
 • Senator Lavelle
                         pending and proposed legislation. PAMIC members recall Representative
   Introduces            Nickol as a good friend of the industry and a very thoughtful and
   Insurance Bills       hardworking legislator.
 • Popular Election of
                         TRIAL LAWYERS ANNOUNCE AGENDA
                         Last week the PA Trial Lawyers Association publicly announced its
   Commissioner          legislative agenda for the coming legislative session. Some of the trial
 • Discount for Lower    lawyers’ goals and objectives are of direct interest to PAMIC members.
                         Consider the following goals:
   Income Senior
                         1. Amend Wrongful Death and Survival Acts to permit recovery for loss of
   Drivers; Course       life and life’s pleasures.
   Takers                2. Amend Wrongful Death Act to permit recovery for loss of filial consortium
                         on the death of either a parent or a child.
 • Time Limits for       3. Permit self-insurers to be sued for bad faith and provide that bad faith is
   Return Unearned       to be determined by the trier of fact (the jury rather than the judge in jury
   Premium               trials).
                         4. No joint and several liability reform reenactment.
 • Raise Financial       5. Amend Political Subdivision Tort Claims Act to bar subrogation for
   Responsibility        amounts paid as a result of injury sustained as a result of a claim for which
   Limits                a sovereign and/or political entity may be liable.
                         6. Increase damage caps in Sovereign Immunity and Political Subdivision
 • Timely Accident       Tort Claims Acts.
   Reports Mandated
                         On February 15, Senator Gerald Lavelle (D-Allegheny, etc.) introduced four
                         insurance bills, all of which were referred to the Senate Banking and
                         Insurance Committee. In order of bill number they are:
                             • SB 286 would prohibit use of “credit rating” for underwriting and
                                rating in auto insurance.
                             • SB 287 would enact the Credit Scoring Prohibition Act. The act would
                PAMIC           prohibit cancellation, nonrenewal, refusal to issue or reissue policy,
1017 Mumma Rd, Ste 103          or imposing a rating factor or surcharge based on credit score in any
Wormleysburg, PA 17043          line of insurance.
  Phone (717) 303-0197       • SB 288 would amend Title 75 (Vehicles) to mandate that, in
    Fax (717) 303-1501          underwriting private passenger auto companies must rate policies on
                                the following factors in declining order of importance: 1) driving
                                record, 2) number of miles driven
                                                                                   (continued on page 2…)
PAMIC Harrisburg Report                                                       February 25, 2005 • Page 2

 (continued from page 1…)

       annually, 3) number of years insured has been driving, 4) any other factor set forth by the
       Insurance Commissioner by regulation. Would also prohibit the use of zip codes or any other
       information that identifies geographical location of the insured.
 •     SB 289 would mandate a “good driver” (as defined) discount of no less than 20%. Some or all of
       the discount may be omitted if the insurer demonstrates in its rate filing that such discounts would
       be duplicative of other discounts provided.

 On February 18, Senator Lavelle introduced SB 330, which was referred to the Senate State
 Government Committee. The bill is a joint resolution amending the Pennsylvania Constitution to
 provide for popular election of the Insurance Commissioner. It would prohibit insurance companies or
 their officers from making any campaign contributions to commissioner candidates and would prohibit
 any Insurance Commissioner from being employed in the insurance industry for 4 years before and 4
 years following service as Commissioner.

 On February 18, Senator Michael Stack (D-Philadelphia) introduced SB 317, which was referred to
 Banking and Insurance. The measure would provide for a discount of at least 10% for taking a driver
 improvement course. The bill also provides for a discount of at least 20% for good drivers who are 65
 years or older and whose incomes are less than $50,000 annually. A lower income senior would be a
 good driver if he or she has been licensed for 3 years without a traffic violation or being found at fault
 in an accident. The bill states that if, after getting the discount, the lower income senior gets into an
 at-fault accident or gets a traffic violation, then the insurer may “revoke” the discount. The bill does
 not describe how that might work.

 Also on February 18, Senator Stack introduced SB 318, also referred to Banking and Insurance. This
 bill would amend the Company Law to provide that unearned premium must be returned within
 10business days if coverage cancelled midterm by the insurer and within 30 business days if cancelled
 by the insured. If the amount of unearned premium cannot be calculated with the time limits, than the
 insurer must make a reasonable estimate and return that amount within the time periods. Then,
 within 15 days of final calculation any additional return “charge” will be made. The bill would exempt
 retro policies from the provision. Finally, violation of the provision would result in a fine of $250 or the
 amount of the unearned premium, whichever is greater.

 Turning to the House of Representatives, on February 14 Representative Steven Maitland (R-Adams,
 Franklin) introduced HB 431. The bill would raise drivers’ financial responsibility limits from
 15,000/30,000 to 50,000/100,000. The Insurance Department would adjust the limits annually based
 on CPI. The uninsured motorist coverages would enjoy similar increases. The property cover minimum
 would be raised from the current $5,000 to $10,000. The bill amends Title 75 and goes to the House
 Transportation Committee.

 On February 14, Representative Rod Wilt (R-Crawford, etc.) introduced HB 467, which also amends
 Title 75 and goes to Transportation. The bill would, among other things, require that the police provide
 insurers and/or persons involved in accidents certified accident reports if requested no later than 3
 days after the accident.

                                                                                              Steven C. Elliott
                                                                                             PAMIC President
     1017 Mumma Rd, Ste 103 • Wormleysburg, PA 17043 • (717) 303-0197 • Fax (717) 303-1501 •

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