Filed Under:Claims, Auto

Getting Ready for January's Requirements

The halls of the state capitols may be somewhat still these days in autumn with so many state legislative sessions having ended. However, insurers continue to contend with upcoming Jan. 1, 2013 effective dates. A few examples serve to both demonstrate the range of areas impacted within an insurance company and indicate the need for procedural changes to ensure compliance when the first of the year rolls around.

The Alabama Department of Revenue (DOR) expects to begin using its new online insurance verification system (OIVS) on Jan. 1, 2013. This permits the verification of motor vehicles covered by liability insurance. Insurers are required to cooperate with the DOR establishing the OIVS and must allow access through the OIVS to verify insurance status. A user guide is available on the DOR’s website, along with the Insurer Information Form which must be completed and submitted. The Department of Insurance (DOI) has enforcement powers allowing the imposition of fines of up to $5,000. A bulletin issued by the DOI on Oct. 29, 2012 provides information on the requirements of OIVS.

Both homeowners' and motor vehicle insurance are featured in two of the upcoming effective dates in California. Insurers issuing homeowners' or tenant's policies will not be allowed to refuse to issue a policy or cancel one solely on the basis that the applicant or policyholder is engaged in foster home activities in a certified family home.

Regarding motor vehicle insurance, with the signing of AB 1708, proof of insurance coverage and evidence of driver financial responsibility will be allowed to be conveyed on mobile electronic devices. This bill permits insurers, upon request of an insured, to issue verification of automobile liability or motor vehicle liability coverage to a mobile electronic device, if available.

Enacted legislation in South Carolina will require that when an insured has sustained motor vehicle glass damage, both the insurer providing glass coverage and the third party administrator (TPA) must not require that repairs be made to the insured's vehicle by a particular provider of glass repair work. Among other requirements, specific claims processing steps are addressed for situations where the insured requests to have covered glass repair work performed by a specific provider of choice. To the extent, the insured’s selection is a member of the insurer's vehicle repair program or preferred provider network, the insurer or its TPA must assign the claim and provide a claim or reference number at that time to the provider of choice. Other requirements apply to insurers and TPAs when the insured requests to have covered glass repair work performed by a provider who is not a member of the insurer's or TPA's vehicle repair program or preferred provider list.

Getting ready for these and many other looming deadlines requires careful analysis of existing processes and determination of what needs to be changed. In some cases, other states have already enacted similar provisions, so adapting internal systems to accommodate a new state’s requirement may allow for a smoother transition to the new year.

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