17may00.....4320h

2000 SESSION

00-2473

01/09

SENATE BILL 368

COMMITTEE: Insurance

ANALYSIS

This bill clarifies the duties of the insurance fraud investigation unit. The bill also allows the insurance commissioner to penalize insurers who fail to submit a plan to detect, prosecute, and prevent fraud.

This bill is a request of the insurance department.

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

17may00.....4320h

00-2473

01/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand

Be it Enacted by the Senate and House of Representatives in General Court convened:

260:1 Fraud Investigation Unit. Amend RSA 417:23 to read as follows:

417:23 Insurance Fraud Investigation Unit Established. There is established in the department of insurance the insurance fraud investigation unit. The unit shall assist the commissioner [in administratively investigating allegations of], or any law enforcement agency, in investigating insurance fraud or other insurance-related criminal activity and in developing and implementing programs to prevent insurance fraud and abuse. The unit shall have the power to subpoena witnesses and administer oaths in any [proceeding before it] investigation it conducts, and to compel the production of any books, papers or other memoranda or documents by subpoena duces tecum. The unit shall promptly notify the attorney general of any insurance application, claim, or activity which involves criminal conduct. When required by the commissioner and the attorney general, the unit shall cooperate with the attorney general in the investigation and prosecution of criminal violations.

260:2 Evidence Collection; Criminal Activity. Amend RSA 417:26 to read as follows:

417:26 Evidence Collection. If, by its own inquiries or as a result of complaints, the insurance department has any reason to believe that a person has engaged in, or is engaging in, any [insurance fraud or has violated any provision of RSA 638:20] criminal activity or any violations involving title XXXVII, it may administer oaths, serve subpoenas ordering the attendance of witnesses or production of material, and collect evidence.

260:3 Antifraud Initiatives. Amend RSA 417:30, I(a)

(a) Fraud [investigations] investigators, who may be insurer employees or independent contractors; or

260:4 New Paragraph; Failure to Submit Plan; Penalty. Amend RSA 417:30 by inserting after paragraph III the following new paragraph:

IV. If the commissioner finds that an insurer licensed to do business in New Hampshire has failed to submit a plan, as required under paragraph I of this section, reasonably calculated to detect, prosecute, and prevent fraudulent insurance acts, or has submitted but failed to execute that plan, the commissioner may issue a fine or suspend the right of the insurer to do business in this state until such time as that insurer comes into compliance with the provisions of this chapter.

260:5 Concealment; Fraud. The unnumbered paragraph of RSA 407:22 relative to concealment, fraud is repealed and reenacted to read as follows:

Concealment, fraud.

Coverage under this policy shall be void for the insured who, whether before or after a loss, has intentionally concealed or misrepresented any material or circumstance; engaged in fraudulent conduct; or made false statements relating to this insurance.

260:6 Effective Date. This act shall take effect 60 days after its passage.

(Approved: June 12, 2000)

(Effective Date: August 11, 2000)