Senator STEPHEN M. SWEENEY
District 3 (Cumberland, Gloucester and Salem)
Senator NELLIE POU
District 35 (Bergen and Passaic)
Prohibits application of fiduciary standard to insurance producers; specifies qualifications of persons providing affidavit of merit in lawsuits against insurance producers.
CURRENT VERSION OF TEXT
As reported by the Senate Commerce Committee on January 17, 2019, with amendments.
An Act concerning insurance producers, supplementing P.L.2001, c.210 (C.17:22A-26 et seq.) and amending P.L.1995, c.139 and P.L.2008, c.38.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. (New section) a. Notwithstanding any law, rule, or regulation to the contrary, an insurance producer shall exercise ordinary 1and reasonable1 care and skill in renewing, procuring, binding, or placing 1property and casualty1 insurance coverage 1and health benefits plans1 requested by an insured or prospective insured person or entity.
b. A cause of action brought by any person or entity against an insurance producer concerning the sale, placement, procurement, renewal, binding or cancellation of, or the failure to procure, a policy of 1property and casualty1 insurance 1or a health benefits plan1, shall not subject the insurance producer to civil liability under standards governing the conduct of a fiduciary or a fiduciary relationship 1, except when the conduct upon which the cause of action is based involves the wrongful retention or misappropriation of any money that was received by the insurance producer, as a premium deposit or as payment of a claim1.
c. The provisions of this section shall not impair or invalidate any of the terms or conditions of a contractual agreement between an insurance producer and an insurer.
d. The provisions of this section shall not limit or exempt an insurance producer from liability for negligence concerning the sale, placement, procurement, renewal, binding, or cancellation of, or the failure to procure, 1[an] a property and casualty1 insurance policy 1or a health benefits plan1; or limit or prevent an insurance producer from asserting any defenses available at common law.
1e. For the purposes of this section, “health benefits plan” shall mean the same as that term is defined in section 1 of P.L.1992, c.161 (C.17B:27A-2).1
2. Section 2 of P.L.1995, c.139 (C.2A:53A-27) is amended to read as follows:
2. a. In any action for damages for personal injuries, wrongful death or property damage resulting from an alleged act of malpractice or negligence by a licensed person in his profession or occupation, the plaintiff shall, within 60 days following the date of filing of the answer to the complaint by the defendant, provide each defendant with an affidavit of an appropriate licensed person that there exists a reasonable probability that the care, skill or knowledge exercised or exhibited in the treatment, practice or work that is the subject of the complaint, fell outside acceptable professional or occupational standards or treatment practices. The court may grant no more than one additional period, not to exceed 60 days, to file the affidavit pursuant to this section, upon a finding of good cause.
b. In the case of an action for medical malpractice, the person executing the affidavit shall meet the requirements of a person who provides expert testimony or executes an affidavit as set forth in section 7 of P.L.2004, c.17 (C.2A:53A-41). In all other cases, the person executing the affidavit shall be licensed in this or any other state; have particular expertise in the general area or specialty involved in the action, as evidenced by board certification or by devotion of the person's practice substantially to the general area or specialty involved in the action for a period of at least five years. The person shall have no financial interest in the outcome of the case under review, but this prohibition shall not exclude the person from being an expert witness in the case.
c. In the case of an action against a licensed insurance producer, regardless of damages sought, the person executing the affidavit pursuant to this section shall be licensed in this State; and have particular expertise in the general area or specialty involved in the action, as evidenced by a professional designation in the general area or specialty involved in the action and by devotion of the person’s practice substantially to the general area or specialty involved in the action during the five years immediately preceding the date of the occurrence that is the basis for the claim or action. The person shall have no financial interest in the outcome of the case under review, but this prohibition shall not exclude the person from being an expert witness in the case.
(cf: P.L.2004, c.17, s.8)
3. Section 25 of P.L.2008, c.38 (C.17:22A-41.1) is amended to read as follows:
25. a. An insurance producer licensed pursuant to P.L.2001, c.210 (C.17:22A-26 et al.) who sells, solicits, or negotiates 1individual health benefits plans as defined in section 1 of P.L.1992, c.161 (C.17B:27A-2), or1 health [insurance policies or contracts] benefits plans 1as defined in section 1 of P.L.1992, c.162 (C.17B:27A-17)1 to 1[residents of this State] small employers as defined in section 1 of P.L.1992, c.162 (C.17B:27A-17),1 shall notify the purchaser of the [insurance] health benefits plan, in writing, of the availability of information concerning the amount of any commission, service fee, brokerage, or other valuable consideration that the producer will receive as a result of the sale, solicitation or negotiation of the health [insurance policy or contract] benefits plan 1[, which information shall be provided upon request]1. [If the commission, fee, brokerage, or other valuable consideration is based on a percentage of premium, the insurance producer shall include that information in the notification to the purchaser.] 1If the commission, fee, brokerage, or other valuable consideration is based on a percentage of premium, the insurance producer shall include that information in the notification to the purchaser.1
b. The commissioner may [specify, by regulation, the information that shall be provided by an insurance producer in the notification to a purchaser of health insurance and the procedure for providing the notification] adopt, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), any rules or regulations necessary to implement this section.
(cf: P.L.2008, c.38, s.25)
4. This act shall take effect immediately.