Insurance Rebate Reform Model Act

The bill creates the "Model Rebate Reform Act" to modernize the law concerning insurance rebates by recognizing new insurance products while maintaining necessary consumer protections. The bill allows an insurer or insurance producer to give a gift valued under $250 in connection with the marketing, purchase, or retention of an insurance contract and to conduct a free raffle or drawing with prizes valued up to $500.

Additionally, the bill provides that an insurer or insurance producer may give a free or discounted product or service in conjunction with or related to an insurance contract if the product or service:

• Is intended to educate about, assess, monitor, control, mitigate, or protect an individual against loss of life, health, or property; or
• Has a nexus to or enhances the value of the insurance benefits.

Next, the bill provides that an insurer or insurance producer may provide an additional free or discounted service if the service is at least tangentially related to an insurance contract or the administration of an insurance contract, the receipt of the service is not contingent on the purchase of insurance, and the service is offered on the same terms to all potential insurance customers. Before the purchase of insurance, receipt of a quote for insurance, or designation of an agent of record, the insurer or insurance producer providing the service shall disclose in writing to the recipient that receipt of the service is not contingent on the purchase of insurance.

Lastly, the bill permits the commissioner of insurance to adopt rules as necessary to effectuate the provisions of the bill, including adjusting the financial limitations on gifts and prizes as necessary for inflation.

(Note: This summary applies to this bill as introduced.)