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Weekly Edition Jan. 26

‘Bad faith’ bill amended in state Senate committee


The New Jersey Senate Commerce Committee amended legislation (S-1559) known as the “bad faith” bill, which would allow consumers to sue insurers for an unreasonable delay or unreasonable denial of a claim for payment of benefits under an insurance policy. However, only individuals who are injured in a car accident and who are entitled to the uninsured or underinsured motorist coverage of an insurance policy—either directly or on behalf of an insured under the policy—are eligible to recover damages. As amended, those eligible individuals who sue would no longer be entitled to recover prejudgment interest, reasonable attorney’s fees, and all reasonable litigation expenses. Similar legislation was introduced last legislative session, at which time PIANJ worked to have language added to exclude insurance producers from those who are eligible to be sued. The exclusion language is included in the amended bill. The bill, sponsored by Sen. Nicholas Scutari, D-22, was referred out of committee as amended by a 3-2 vote.


PIANJ and PIA National announce priorities for 2021


PIANJ has finalized its legislative agenda for the new session; your association will focus on banning personal auto step-down provisions and producer duty of care. For more details, watch your PIANJ publications and the PIAdvocacy bill tracker. Additionally, PIA National also outlined its legislative agenda for 2021, which includes: COVID-19 small-business relief, reauthorization of the National Flood Insurance Program, protection of agent commissions for the sale of crop insurance, creation of a safe harbor for agents who sell insurance to cannabis-related businesses, defense of the state insurance regulatory system, and repeal of the pass-through tax deduction’s sunset provision.


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News from PIA National


Half-a-million doses of COVID-19 vaccine distributed in N.J.


According to Gov. Phil Murphy the state has distributed more than half-a-million doses of the COVID-19 vaccine in a little over a month—as of last week. To keep you updated on the latest COVID-19-related news, see the PIANJ COVID-19 resource page and be sure to read your PIANJ publications. Recent updates include: Gov. Murphy signs order to extend public health emergency; and the N.J. Department of Health issued the latest edition of its Vax Matters newsletter.


Caride named as chair of a NAIC committee


Recently, the National Association of Insurance Commissioners named its 2021 committee chairs and vice chairs. The Department of Banking and Insurance Commissioner Marlene Caride was named as the chair of the Life Insurance and Annuities Committee. In his letter of congratulations, PIANJ President Steven C. Radespiel said: “PIANJ is a strong supporter of NAIC’s mission to assist state insurance regulators in serving the public interest to support and improve state regulation of insurance. The NAIC serves as a great example of how well the state-based insurance system works.”


Capitol riot stresses insurance’s importance


Insurance industry officials say U.S. taxpayers will have to pay for damage caused by rioters at the U.S. Capitol on Jan. 6. They say the U.S. Capitol and the surrounding grounds are not covered by an insurance policy. The people involved in the attack broke windows, doors, art and furniture. The exact cost of the incident remains unknown. The Architect of the Capitol, which manages building preservation and maintenance, also is expected to pay for some of the costs. When it comes to repair and cleanup costs, the federal government has considered insurance too costly to acquire. This stance did not change after the Sept. 11 terrorist attacks, which caused as much as $1 billion in damage at the Pentagon.


Experts expect E&O lawsuits to increase, PIANJ to hold related forum


The issue of errors-and-omissions is making headlines as experts predict that E&O lawsuits will be on the rise due to the number of COVID-19-related lawsuits that could be filed this year. PIANJ will host a virtual forum to focus on the E&O issues that affect independent agents. The event will be held in March. Speakers will include agents who will share their E&O-issue experiences and PIA’s government affairs team who will discuss the relevant legislative efforts. The attendees will have the opportunity to ask each other questions. This is the first of many virtual forums that PIANJ will hold specifically for independent insurance agents on topics pertinent to business today. To register, email PIA Government & Industry Affairs.


Ask PIA: Underinsured motorists physical damage


Q. My client was driving a truck carrying $18,000 worth of cabinetry. He was involved in an accident with another vehicle that was determined to be at fault. The at-fault driver’s vehicle was insured with low-limit coverage, which likely will not compensate my client for his truck and the cabinetry damaged (a bridge and telephone pole also were damaged in the accident). Will New Jersey uninsured motorists coverage pay for the damages, including the cabinetry? A. Yes. The uninsured motorists coverage insures property damage, which is defined to include the covered automobile and the insured’s property contained in the covered automobile subject to a limit and deductible. Be advised that this coverage does not apply to a hit-and-run accident. As a PIA member, you have access to the entire Ask PIA library of frequently asked questions and expert answers by PIA’s technical staff.


PIANJ CIC and CISR programs available online


PIANJ’s Certified Insurance Counselor and Certified Insurance Service Representative designation programs continue to be available online. These continuing-education credit-approved, nationally recognized designation programs take a practical, hands-on approach to learning. These designations are recognized nationwide as important credentials—ones that benefit individuals, their agencies, and their customers. To earn the CIC or CISR designation, participants must attend class and pass exams for five of the seven courses, or for five of the nine courses, respectively. Upcoming CIC classes include: Jan. 27-28: 2021 CIC Agency Management Institute^FF^UNFeb. 10-11: 2021 CIC Commercial Multi-Line Institute; and March 10-11: 2021 CIC CC: Commercial Casualty Institute. Upcoming CISR classes include: March 3: 2021 CISR 2IC: Insuring Commercial Casualty II; and March 24-25: 2021 CISR AO: Agency Operations^FF^UN^FF^UN–This course has been approved for E&O loss-prevention credit by Fireman’s Fund and Utica National. Call the PIA E&O Department for details. For more offerings, see the complete education schedule.


PIANJ education: Privacy laws, ethics and more


Looking for quality education classes? PIANJ offers a wide range of education sessions on salient topics, including the following open webinars: The Coronavirus and the Commercial Client (Wednesday, Jan. 27, NJCE: 1 GEN); Understanding CGL Exclusions (Wednesday, Feb. 3, NJCE: 3 GEN); CPIA Advanced: An E&O Loss Control Program for All Agencies (Wednesday, Feb. 3, NJCE: N/A); Cybersecurity Compliance: The Insurance Agency Edition (Friday, Feb. 5, NJCE: 2 GEN); Endorsements: The Good, the Bad, and the Ugly (Monday, Feb. 8, NJCE: 3 GEN); Cybersecurity Insurance: Identifying the Risk and Avoiding the Claim (Friday, Feb. 12, NJCE: 2 GEN); Understanding CGL Exclusions (Wednesday, Feb. 17, NJCE: 3 GEN); Protecting Wine Collections–An Insurer’s Perspective (Thursday, Feb. 18, NJCE: TBA); Data Privacy Laws and the Commercial Client (Friday, Feb. 19, NJCE: 1 GEN); E&O Loss Prevention and Ethics–There is a Connection^FF^UN (Monday, Feb. 22, NJCE: 3 ETH); and Cyber Liability & Data Breach: More Important the Ever! (Friday, Feb. 26, NJCE: 2 GEN). ^FF^UN–This course has been approved for E&O loss-prevention credit by Fireman’s Fund and Utica National. Call the PIA E&O Department for details. For more offerings, see the complete education schedule.


Insurable interest


Insurance practitioners know that, although an event under a property insurance policy is covered, that doesn’t necessarily mean that a claimant will be paid. Two additional considerations stand out to determine the legitimacy of a claim: 1. the claimant must be an insured under the policy; and 2. the insured must have an insurable interest. PIA’s Director of Research Dan Corbin, CPCU, CIC, LUTC, outlines the rules to determine whether the insurable interest requirement has sufficiently been met for appropriate coverage to apply. For more information, access Insurable interest—how far will it stretch? in the PIA QuickSource library.


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