<section article="gin" article_name="Insurance" number="27-101" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="1" subtitle_name="General Provisions"> <text>The purpose of this title is to regulate trade practices in the business of insurance in accordance with the intent of Congress expressed in the McCarran-Ferguson Act, 15 U.S.C. §§ 1011 through 1015, by defining, or providing for the determination of, all trade practices in the business of insurance in the State that are unfair methods of competition or unfair or deceptive acts or practices and by prohibiting those trade practices.</text> </section> <section article="gin" article_name="Insurance" number="27-102" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="1" subtitle_name="General Provisions"> <text>A person may not engage in the State in a trade practice that is defined in this title as, or determined under this title to be, an unfair method of competition or an unfair or deceptive act or practice in the business of insurance.</text> </section> <section article="gin" article_name="Insurance" number="27-103" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="1" subtitle_name="General Provisions"> <level label="a"> <level label="1"> <text>If the Commissioner finds that a person in the State has engaged or is engaging in an act or practice that is defined in or prohibited under this title, the Commissioner shall order the person to cease and desist from the act or practice.</text> </level> <level label="2"> <text>The Commissioner shall hold a hearing before the Commissioner issues a cease and desist order under this subsection.</text> </level> <level label="3"> <text>The Commissioner shall give the person notice of the hearing and the charges against the person.</text> </level> </level> <level label="b"> <text>The cease and desist order is final:</text> <level label="1"> <text>if no appeal is taken, when the time allowed for taking an appeal from an order of the Commissioner expires; or</text> </level> <level label="2"> <text>if an appeal is taken, when the court issues a final decision that affirms the cease and desist order or dismisses the appeal.</text> </level> </level> <level label="c"> <text>If an appeal is taken, the court shall issue its own order that requires compliance with the terms of the cease and desist order to the extent that the cease and desist order is affirmed.</text> </level> <level label="d"> <text>Violation of a cease and desist order issued under this section is deemed to be and is punishable as a violation of this article.</text> </level> <level label="e"> <text>A cease and desist order issued under this section or an order of court that enforces it does not relieve any person affected by the order from any other liability, penalty, or forfeiture under law.</text> </level> <level label="f"> <text>Regardless of whether a hearing is scheduled or held or a cease and desist order is issued, this section does not affect or prevent the imposition of a penalty provided by this article or other law for violation of another provision of this title.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-104" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="1" subtitle_name="General Provisions"> <level label="a"> <text>If the Commissioner believes that a person engaged in the insurance business is engaging in the State in a method of competition or in an act or practice in the conduct of insurance business that, although not defined in this title, is an unfair method of competition or an unfair or deceptive act or practice and that a proceeding by the Commissioner with respect to the method of competition, act, or practice would be in the public interest, the Commissioner shall:</text> <level label="1"> <text>give the person notice of the hearing and the charges against the person;</text> </level> <level label="2"> <text>hold the hearing;</text> </level> <level label="3"> <text>make a written report of the Commissioner’s findings of fact about the charges; and</text> </level> <level label="4"> <text>serve a copy of the report on the person against whom the charges were brought and any intervenor at the hearing.</text> </level> </level> <level label="b"> <level label="1"> <text>If the report charges a violation of this title and the unfair method of competition or unfair or deceptive act or practice continues, the Commissioner, through the Attorney General, after service of the report, may bring an action to enjoin and restrain the person from engaging in the method of competition, act, or practice.</text> </level> <level label="2"> <text>The Commissioner’s report and findings, all evidence taken in the hearing, and, if a stenographic record of the proceedings in the hearing before the Commissioner was made, a certified transcript of the hearing shall be received in evidence in an action under this subsection.</text> </level> <level label="3"> <text>In an action under this subsection, the court may issue an injunction or restraining order on any terms that are just.</text> </level> <level label="4"> <text>The court may not require the Commissioner to give security before the court issues the injunction or restraining order.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-105" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="1" subtitle_name="General Provisions"> <text>If an order issued by the Commissioner under § 27-103 of this subtitle or a report of the Commissioner made under § 27-104 of this subtitle does not charge a violation of this title, any intervenor in the proceedings may appeal from the order or report in the time and manner provided in this article for appeals from orders of the Commissioner generally.</text> </section> <section article="gin" article_name="Insurance" number="27-201" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>The commission of an act prohibited under this subtitle is defined as an unfair method of competition and an unfair and deceptive act or practice in the business of insurance.</text> </section> <section article="gin" article_name="Insurance" number="27-202" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>A person may not:</text> <level label="1"> <text>make, issue, circulate, or cause to be made, issued, or circulated an estimate, circular, or statement that misrepresents the terms of a policy issued or to be issued, the benefits or advantages promised by the policy, or the dividends or share of the surplus to be received on the policy;</text> </level> <level label="2"> <text>make a false or misleading statement about the dividends or share of the surplus previously paid on similar policies;</text> </level> <level label="3"> <text>make a misleading representation or any misrepresentation about the financial condition of an insurer or about the legal reserve system on which a life insurer operates; or</text> </level> <level label="4"> <text>use a name or title of a policy or class of policies that misrepresents the true nature of the policy or class of policies.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-203" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>A person may not make, publish, disseminate, circulate, place before the public, or cause directly or indirectly to be made, published, disseminated, circulated, or placed before the public in a newspaper, magazine, or other publication, in the form of a notice, circular, pamphlet, letter, or poster, over a radio or television station, or in any other way, an advertisement, announcement, or statement that contains an assertion, representation, or statement about the business of insurance or about a person in the conduct of the person’s insurance business that is untrue, deceptive, or misleading.</text> </section> <section article="gin" article_name="Insurance" number="27-204" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>A person may not make, publish, disseminate, or circulate, directly or indirectly, or aid, abet, or encourage the making, publishing, disseminating, or circulating of an oral or written statement or a pamphlet, circular, article, or literature that:</text> <level label="1"> <text>is false or maliciously critical of or derogatory to the financial condition of an insurer or person proposing to become an insurer; and</text> </level> <level label="2"> <text>is calculated to injure a person engaged in or proposing to engage in the business of insurance.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-205" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>A person may not knowingly file with a supervisory or other public official, make, publish, disseminate, circulate, deliver to another person, place before the public, or cause directly or indirectly to be made, published, disseminated, circulated, delivered to another person, or placed before the public a false statement of the financial condition of an insurer.</text> </level> <level label="b"> <text>A person may not:</text> <level label="1"> <text>make a false entry in a book, report, or statement of an insurer with intent to deceive an agent or examiner lawfully appointed to examine the condition or affairs of the insurer or a public official to whom the insurer is required by law to report or who has authority by law to examine the condition or affairs of the insurer; or</text> </level> <level label="2"> <text>with intent to deceive, willfully omit to make a true entry of a material fact about the business of the insurer in a book, report, or statement of the insurer.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-206" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>A person may not enter into an agreement to commit, or by concerted action commit, an act of boycott, coercion, or intimidation that results in or tends to result in unreasonable restraint of or monopoly in the business of insurance.</text> </section> <section article="gin" article_name="Insurance" number="27-207" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>A person may not issue, deliver, or allow an agent, officer, or employee of the person to issue or deliver agency company stock or other capital stock, benefit certificates or shares in a corporation, or an advisory board contract or other similar contract that promises returns and profits as an inducement to insurance.</text> </section> <section article="gin" article_name="Insurance" number="27-208" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <level label="1"> <text>A person may not make or allow unfair discrimination between individuals of the same class and equal expectation of life in:</text> <level label="i"> <text>the rates charged for a contract of life insurance or an annuity contract;</text> </level> <level label="ii"> <text>the dividends or other benefits payable on a contract of life insurance or an annuity contract; or</text> </level> <level label="iii"> <text>any of the other terms or conditions of a contract of life insurance or an annuity contract.</text> </level> </level> <level label="2"> <level label="i"> <text>Notwithstanding any other provision of this section, an insurer may not make or allow a differential in ratings, premium payments, or dividends for contracts of life insurance or annuity contracts for a reason based on the blindness or other physical handicap or disability of an applicant or policyholder.</text> </level> <level label="ii"> <text>Actuarial justification for the differential may be considered for a physical handicap or disability other than blindness or hearing impairment.</text> </level> </level> <level label="3"> <text>Unless there is actuarial justification, an insurer may not refuse to insure or make or allow a differential in ratings, premium payments, or dividends in connection with life insurance and annuity contracts solely because the applicant or policyholder has the sickle–cell trait, thalassemia–minor trait, hemoglobin C trait, Tay–Sachs trait, or a genetic trait that is harmless in itself.</text> </level> <level label="4"> <text>With respect to a life insurance contract, an insurer may not refuse to insure, refuse to continue to insure, limit the amount or extent or kind of coverage available to an individual, or charge an individual a different rate for the same coverage solely for reasons associated with an applicant’s or insured’s past lawful travel experiences.</text> </level> <level label="5"> <level label="i"> <text>Except as provided in subparagraph (ii) of this paragraph, with respect to a life insurance contract, an insurer may not refuse to insure, refuse to continue to insure, limit the amount or extent or kind of coverage available to an individual, or charge an individual a different rate for the same coverage solely for reasons associated with an applicant’s or insured’s future lawful travel.</text> </level> <level label="ii"> <level label="1"> <text>Subparagraph (i) of this paragraph does not prohibit an insurer from excluding or limiting coverage of specific future lawful travel, or charging a differential rate for such coverage, when bona fide differences in risk or exposure have been substantiated by the use of relevant data from at least one independent reliable source, including statistical or other mathematical analysis of available data that establishes a material variation in actual or reasonably anticipated experience that correlates to the risk of specific future lawful travel.</text> </level> <level label="2"> <text>Travel advisories issued by the United States Department of State do not qualify as the sole source of data for purposes of this subparagraph.</text> </level> <level label="3"> <text>An insurer shall:</text> </level> <level label="A"> <text>maintain the data and documents that support the insurer’s determination that bona fide differences in risk or exposure exist; and</text> </level> <level label="B"> <text>make the data and documents available on request by the Commissioner.</text> </level> </level> </level> </level> <level label="b"> <level label="1"> <text>A person may not make or allow unfair discrimination between individuals of the same class and of essentially the same hazard:</text> <level label="i"> <text>in the amount of premium, policy fees, or rates charged for a policy or contract of health insurance;</text> </level> <level label="ii"> <text>in the benefits payable under a policy or contract of health insurance;</text> </level> <level label="iii"> <text>in any of the terms or conditions of a policy or contract of health insurance; or</text> </level> <level label="iv"> <text>in any other manner.</text> </level> </level> <level label="2"> <text>Notwithstanding any other provision of this section, an insurer may not make or allow a differential in ratings, premium payments, or dividends for a reason based on the sex of an applicant or policyholder unless there is actuarial justification for the differential.</text> </level> <level label="3"> <level label="i"> <text>Except as provided in § 27-909 of this title and notwithstanding any other provision of this section, an insurer may not make or allow a differential in ratings, premium payments, or dividends for contracts of health insurance for a reason based on the blindness or other physical handicap or disability of an applicant or policyholder.</text> </level> <level label="ii"> <text>Except as provided in § 27-909 of this title, actuarial justification for the differential may be considered for a physical handicap or disability other than blindness or hearing impairment.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-209" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>Except as otherwise expressly provided by law, a person, including a health maintenance organization, may not knowingly:</text> <level label="1"> <text>allow, make, or offer to make a contract of life insurance or health insurance or an annuity contract or an agreement as to the contract other than as plainly expressed in the contract;</text> </level> <level label="2"> <text>pay, allow, give, or offer to pay, allow, or give directly or indirectly as an inducement to the insurance or annuity:</text> <level label="i"> <text>a rebate of premiums payable on the contract;</text> </level> <level label="ii"> <text>a special favor or advantage in the dividends or other benefits under the contract;</text> </level> <level label="iii"> <text>paid employment or a contract for services of any kind; or</text> </level> <level label="iv"> <text>any valuable consideration or other inducement not specified in the contract;</text> </level> </level> <level label="3"> <text>directly or indirectly give, sell, purchase, offer or agree to give, sell, or purchase, or allow as inducement to the insurance or annuity or in connection with the insurance or annuity, regardless of whether specified in the policy or contract, an agreement that promises returns and profits, or stocks, bonds, or other securities, or a present or contingent interest in or measured by stocks, bonds, or other securities, of an insurer or other corporation, association, or partnership, or dividends or profits accrued or to accrue on stocks, bonds, or other securities; or</text> </level> <level label="4"> <text>offer, promise, or give any valuable consideration not specified in the contract, except for educational materials, promotional materials, or articles of merchandise that cost no more than $50.</text> </level> </level> <level label="b"> <text>A person may not make receipt of any educational materials, promotional materials, or articles of merchandise under subsection (a)(4) of this section contingent on the sale or purchase of insurance.</text> </level> <level label="c"> <level label="1"> <text>This section does not prohibit an insurer, a nonprofit health service plan, or a health maintenance organization from offering or providing products or services in conjunction with a policy at no charge or at a discounted price if:</text> <level label="i"> <level label="1"> <level label="A"> <text>the products or services are offered or provided to educate persons regarding, or to assess, monitor, control, or prevent, risk of loss to persons; and</text> </level> </level> <level label="B"> <text>the risk of loss to persons is associated with risks insured against by the policy or insurance or annuity contract; or</text> </level> <level label="2"> <text>the products or services are:</text> </level> <level label="A"> <text>substantially related to the insurance provided under the policy or contract; or</text> </level> <level label="B"> <text>offered or provided to enhance the health of the insured or beneficiary; and</text> </level> </level> <level label="ii"> <text>the offer or provision of products or services is available to all policyholders that have purchased the policy or contract associated with the offer or provision.</text> </level> </level> <level label="2"> <text>An insurer, a nonprofit health service plan, or a health maintenance organization may include an offer or a provision of products or services under this subsection in an applicable contract or form or rate filing.</text> </level> <level label="3"> <level label="i"> <text>If the offer or provision of specific products or services under this subsection is included in any policy of insurance, health maintenance organization contract, nonprofit health service plan, or annuity contract, the products or services may not be discontinued during the term of the policy or contract unless discontinuation of the product or services is:</text> <level label="1"> <text>consented to in writing by the policyholder; or</text> </level> <level label="2"> <text>the result of a uniform modification under § 15–1212, § 15–1309, or § 15–1409 of this article.</text> </level> </level> <level label="ii"> <text>This paragraph does not prohibit a carrier from terminating a contract as otherwise authorized under this article.</text> </level> </level> <level label="4"> <text>An insurer, a nonprofit health service plan, or a health maintenance organization may not increase the premium or deny a claim of a policyholder if the policyholder accepts, rejects, uses, or fails to use a product or service under this subsection.</text> </level> <level label="5"> <level label="i"> <text>Subject to subparagraph (ii) of this paragraph, the Commissioner may determine by regulation the types of products or services that meet the criteria in paragraph (1) of this subsection.</text> </level> <level label="ii"> <text>A product or service offered or provided in conjunction with an insurance policy or annuity contract that is primarily designed to enhance financial wellness shall be allowed if the Commissioner determines that the product or service includes an enhancement to the financial protection component of the insurance policy or annuity contract.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-210" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>Sections 27–208 and 27–209 of this subtitle may not be construed to include within the definition of discrimination or rebates any of the practices set forth in this section.</text> </level> <level label="b"> <text>For a contract of life insurance or an annuity contract, it is not discrimination or a rebate to pay bonuses to policyholders or otherwise abate their premiums wholly or partly out of the surplus accumulated from nonparticipating insurance, if the bonuses or abatement of premiums is fair, equitable to, and in the best interest of policyholders.</text> </level> <level label="c"> <text>For policies of life insurance or health insurance issued on the industrial debit, preauthorized check, bank draft, or similar plans, it is not discrimination or a rebate to make an allowance to policyholders who have continuously for a specified period made premium payments directly to an office of the insurer or by preauthorized check, bank draft, or similar plans in an amount that fairly represents the savings in collection expense.</text> </level> <level label="d"> <text>It is not discrimination or a rebate to readjust the rate of premium for a group policy based on the loss or expense experience under the policy, at the end of any policy year, retroactive only for that policy year.</text> </level> <level label="e"> <text>It is not discrimination or a rebate to reduce the premium rate for policies of large amount, if the reduction does not exceed savings in issuance and administrative expenses reasonably attributable to policies of large amount as compared with policies of similar plan issued in smaller amounts.</text> </level> <level label="f"> <text>It is not discrimination or a rebate to issue policies of life insurance or health insurance or annuity contracts on a salary savings or payroll deduction plan or other distribution plan at a reduced rate reasonably commensurate with the savings made by use of the plan.</text> </level> <level label="g"> <text>It is not discrimination or a rebate to issue policies of health insurance that provide for increases in benefits to policyholders who maintain their policies continuously in force without lapse for specified periods.</text> </level> <level label="h"> <level label="1"> <text>In this subsection, “wellness program” means a program that:</text> <level label="i"> <text>meets the requirements of a participatory wellness program or a health–contingent wellness program under § 15–509 of this article; and</text> </level> <level label="ii"> <text>is provided as a benefit outside of the health insurance or health maintenance organization contract.</text> </level> </level> <level label="2"> <text>It is not discrimination or a rebate for a carrier to provide reasonable incentives to an individual who is an insured, a subscriber, or a member for participation in a wellness program offered by the carrier.</text> </level> <level label="3"> <text>Any incentive offered for participation in a wellness program:</text> <level label="i"> <text>shall be reasonably related to the wellness program; and</text> </level> <level label="ii"> <text>may not have a value that exceeds any limit established in regulations adopted by the Commissioner.</text> </level> </level> <level label="4"> <text>The Commissioner shall adopt regulations to implement the provisions of this subsection.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-211" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>This section does not apply to:</text> <level label="1"> <text>insurance on the life of a debtor in connection with a specific loan or other credit transaction;</text> </level> <level label="2"> <text>insurance on a debtor that provides indemnity for payments that are due on a specific loan or other credit transaction while the debtor is disabled as defined in the policy; or</text> </level> <level label="3"> <text>life insurance or an annuity used to fund a pre-need contract as defined in § 7-101 of the Health Occupations Article or a preneed burial contract as defined in § 5-701 of the Business Regulation Article.</text> </level> </level> <level label="b"> <text>An insurer may not directly or indirectly, or by an insurance producer or representative of the insurer, participate in a plan to offer or effect a kind or kinds of life insurance, health insurance, or annuities in the State as an inducement to, or in combination with, the purchase by the public of goods, securities, commodities, services or subscriptions to periodicals.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-212" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>This section does not apply to life insurance, health insurance, and annuities.</text> </level> <level label="b"> <text>Except to the extent provided for in an applicable filing with the Commissioner as provided by law, an insurer, employee or representative of an insurer or insurance producer may not pay, allow, give, or offer to pay, allow, or give directly or indirectly as an inducement to insurance or after insurance has become effective:</text> <level label="1"> <text>a rebate, discount, abatement, credit, or reduction of the premium stated in the policy;</text> </level> <level label="2"> <text>a special favor or advantage in the dividends or other benefits to accrue on the policy; or</text> </level> <level label="3"> <text>any valuable consideration or other inducement not specified in the policy.</text> </level> </level> <level label="c"> <text>An insured named in a policy or an employee of the insured may not knowingly receive or accept directly or indirectly a rebate, discount, abatement, credit, reduction of premium, special favor, advantage, valuable consideration, or inducement described in subsection (b) of this section.</text> </level> <level label="d"> <level label="1"> <text>Except as otherwise provided by law, a person may not knowingly offer, promise, or give any valuable consideration not specified in the policy, except for educational materials, promotional materials, or articles of merchandise that cost no more than $50.</text> </level> <level label="2"> <text>A person may not make receipt of any educational materials, promotional materials, or articles of merchandise under this subsection contingent on the sale or purchase of insurance.</text> </level> </level> <level label="e"> <level label="1"> <text>An insurer may not make or allow unfair discrimination between insureds or properties having like insuring or risk characteristics in:</text> <level label="i"> <text>the premium or rates charged for insurance;</text> </level> <level label="ii"> <text>the dividends or other benefits payable on the insurance; or</text> </level> <level label="iii"> <text>any of the other terms or conditions of the insurance.</text> </level> </level> <level label="2"> <text>Notwithstanding any other provision of this section, an insurer may not make or allow a differential in ratings, premium payments, or dividends for a reason based on the sex, physical handicap, or disability of an applicant or policyholder unless there is actuarial justification for the differential.</text> </level> </level> <level label="f"> <level label="1"> <text>This section does not prohibit an insurer from:</text> <level label="i"> <text>paying commissions or other compensation to licensed insurance producers;</text> </level> <level label="ii"> <text>paying commissions to licensed insurance producers on a variable basis on policies issued to qualified exempt commercial policyholders, as defined in § 11–206 of this article, if:</text> <level label="1"> <text>the payment of the commission to the insurance producer on a variable basis results in a lower total cost of the policy to the qualified exempt commercial policyholder; and</text> </level> <level label="2"> <text>the insurance producer receiving the commission has agreed to the specific level of commission to be paid on the policy;</text> </level> </level> <level label="iii"> <text>allowing or returning to its participating policyholders, members, or subscribers lawful dividends, savings, or unabsorbed premium deposits; or</text> </level> <level label="iv"> <text>offering or providing products or services in conjunction with a policy at no charge or at a discounted price to educate a person regarding, or to assess, monitor, control, or prevent, risk of loss to persons or property if:</text> <level label="1"> <text>the risk of loss to persons or property is associated with the risks insured against by the policy; and</text> </level> <level label="2"> <text>the offer or provision of products or services is available to all policyholders that have purchased the policy associated with the offer or provision.</text> </level> </level> </level> <level label="2"> <text>An insurer may include in an applicable contract or form or rate filing an offer or a provision of products or services under this subsection.</text> </level> <level label="3"> <text>An insurer may not increase the premium or deny a claim of a policyholder if the policyholder accepts, rejects, uses, or fails to use a product or service under this subsection.</text> </level> <level label="4"> <text>The Commissioner may determine by regulation the types of products or services that meet the criteria in paragraph (1)(iv) of this subsection.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-213" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>A person may not make, issue, or cause to be made or issued an oral or written statement that misrepresents or makes incomplete comparisons about the terms, conditions, or benefits contained in a policy for the purpose of inducing or attempting or tending to induce the policyholder to forfeit, surrender, retain, exchange, or convert a policy or allow a policy to lapse.</text> </section> <section article="gin" article_name="Insurance" number="27-214" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <level label="1"> <text>A person may not require another person to buy insurance through a particular insurance producer or insurer as a condition, agreement, or understanding with respect to selling or providing a loan, credit, sale, goods, property, contract, lease, or service to the other person.</text> </level> <level label="2"> <text>An insurance producer or insurer may not participate in a combination plan or transaction prohibited by paragraph (1) of this subsection.</text> </level> </level> <level label="b"> <level label="1"> <text>A person may not solicit the combination of insurance and other matters prohibited by subsection (a) of this section.</text> </level> <level label="2"> <text>An insurance producer or insurer may not participate in a plan of public solicitation of the combination of insurance and other matters prohibited by subsection (a) of this section.</text> </level> <level label="3"> <text>This subsection does not prohibit a person from being an insurance producer and engaging in another business at the same time or place if:</text> <level label="i"> <text>the sales of insurance and other matters are not combined or coerced as prohibited by subsection (a) of this section; and</text> </level> <level label="ii"> <text>the buyer or other person has the free choice of insurance.</text> </level> </level> </level> <level label="c"> <level label="1"> <text>Violation of this section does not invalidate any contract or transaction.</text> </level> <level label="2"> <text>Notwithstanding a combination contract, tying agreement, understanding, or condition to the contrary, the person required to buy or pay for insurance or to bid ex–insurance may substitute at any time other insurance from insurance producers or insurers chosen by the person, or may decline further insurance coverage if the insurance is other than to protect the interest of a lender, property owner, or other person.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-215" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>An insurer may retain, invest in, or acquire all or part of the capital stock of another insurer or have common management with another insurer, unless the retention, investment, acquisition, or common management is inconsistent with another provision of this article or causes the business of the insurers with the public to be conducted in a manner that substantially lessens competition generally in the insurance business or tends to create a monopoly in the insurance business.</text> </level> <level label="b"> <text>An individual otherwise qualified may be director of two or more insurers that are competitors, unless the effect substantially lessens competition between insurers generally or tends materially to create a monopoly.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-216" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>A person may not willfully collect a premium or charge for insurance if the insurance is not then provided, or is not in due course to be provided subject to acceptance of the risk by the insurer, in a policy issued by an insurer as authorized by this article.</text> </level> <level label="b"> <level label="1"> <text>A person may not willfully collect a premium or charge for insurance that:</text> <level label="i"> <text>exceeds or is less than the premium or charge applicable to that insurance under the applicable classifications and rates as filed with and approved by the Commissioner; or</text> </level> <level label="ii"> <text>if classifications, premiums, or rates are not required by this article to be filed with and approved by the Commissioner, exceeds or is less than the premium or charge specified in the policy and set by the insurer.</text> </level> </level> <level label="2"> <text>Paragraph (1) of this subsection does not prohibit:</text> <level label="i"> <text>a surplus lines broker that holds a certificate of qualification under Title 3, Subtitle 3 of this article from charging and collecting applicable State and federal taxes in addition to the required premium;</text> </level> <level label="ii"> <text>a life insurer from charging and collecting the amount actually expended for a medical examination of an applicant for life insurance or reinstatement of a policy of life insurance;</text> </level> <level label="iii"> <text>an insurance producer from charging a fee, not exceeding 15% of the premium, for services rendered in placing insurance in an insurer if commissions are not payable by the insurer;</text> </level> <level label="iv"> <text>an insurer from paying commissions to licensed insurance producers on a variable basis on policies issued to qualified exempt commercial policyholders, as defined in § 11–206 of this article, if:</text> <level label="1"> <text>the payment of the commission to the insurance producer on a variable basis results in a lower total cost of the policy to the qualified exempt policyholder; and</text> </level> <level label="2"> <text>the insurance producer receiving the commission has agreed to the specific level of commission to be paid on the policy; or</text> </level> </level> <level label="v"> <text>a fund producer from charging and collecting, as actual expenses incurred in placing automobile insurance with the Maryland Automobile Insurance Fund:</text> <level label="1"> <text>a maximum charge of $25 plus $1 more than the actual charge by the Motor Vehicle Administration for a driving record required to be presented with the application, unless otherwise provided by the Fund; or</text> </level> <level label="2"> <text>the amount provided in subsection (e) of this section.</text> </level> </level> </level> <level label="3"> <level label="i"> <text>Subject to subparagraphs (ii), (iii), (iv), and (v) of this paragraph, paragraph (1) of this subsection does not prohibit an authorized insurer or the Maryland Automobile Insurance Fund from charging and collecting, if approved by the Commissioner, reasonable installment fees or reasonable fees for late payment of premiums by policyholders or both.</text> </level> <level label="ii"> <text>The Commissioner:</text> <level label="1"> <text>shall review administrative expenses submitted by an authorized insurer or the Maryland Automobile Insurance Fund that are associated with late payments or installment payments, including the cost incurred by an authorized insurer or a vendor of the authorized insurer to accept late payments or installment payments by credit card, debit card, electronic funds transfer, or electronic check payment; and</text> </level> <level label="2"> <text>may approve a late fee or installment fee not to exceed $10.</text> </level> </level> <level label="iii"> <text>A late fee may not be imposed:</text> <level label="1"> <text>during any grace period required by law or regulation on a policy of insurance; or</text> </level> <level label="2"> <text>if no grace period is required by law or regulation on a policy of insurance, until 2 business days after the date the payment amount becomes due.</text> </level> </level> <level label="iv"> <text>An authorized insurer or the Maryland Automobile Insurance Fund shall credit each payment received from an insured to the premium owed by the insured before crediting the payment to a late fee or installment fee owed by the insured.</text> </level> <level label="v"> <text>A policy of insurance may not be canceled for the failure to pay a single late fee or single installment fee.</text> </level> </level> <level label="4"> <level label="i"> <text>Subject to subparagraphs (ii) and (iii) of this paragraph, paragraph (1) of this subsection does not prohibit an insurance producer from charging and collecting from an insured actual expenses incurred by the insurance producer for payment of the premium for a policy by use of a credit card.</text> </level> <level label="ii"> <text>Any point of service credit card expenses may not be considered premium for any purpose under this paragraph.</text> </level> <level label="iii"> <text>An insurance producer that accepts alternative payment methods for premiums shall disclose fully to the insured or prospective insured:</text> <level label="1"> <text>the availability of all payment methods accepted by the insurer or insurance producer; and</text> </level> <level label="2"> <text>any charge for actual expenses incurred by the insurance producer for payment of a premium by use of a credit card.</text> </level> </level> </level> <level label="5"> <level label="i"> <text>Paragraph (1) of this subsection does not prohibit an authorized motor vehicle insurer or the Maryland Automobile Insurance Fund from charging and collecting a reasonable fee approved by the Commissioner under subparagraph (iii) of this paragraph for the reinstatement of a private passenger motor vehicle liability insurance policy in accordance with § 19–519 of this article.</text> </level> <level label="ii"> <text>Paragraph (1) of this subsection does not prohibit a licensed insurance producer or a fund producer from charging and collecting a reasonable fee approved by the Commissioner under subparagraph (iii) of this paragraph for the reinstatement of a private passenger motor vehicle liability insurance policy in accordance with § 19–519 of this article.</text> </level> <level label="iii"> <text>The Commissioner:</text> <level label="1"> <text>shall review the administrative expenses submitted by an authorized motor vehicle insurer or the Maryland Automobile Insurance Fund that are associated with reinstatements under § 19–519 of this article; and</text> </level> <level label="2"> <text>may approve a reinstatement fee not to exceed:</text> </level> <level label="A"> <text>$10 to be charged and collected by the insurer or the Fund; and</text> </level> <level label="B"> <text>$15 to be charged and collected by the insurance producer or the fund producer.</text> </level> </level> </level> </level> <level label="c"> <text>An insurer may not raise the policy limits of coverage, if the effect could be an increase in the premium without the prior consent of the insured.</text> </level> <level label="d"> <level label="1"> <text>Notwithstanding subsection (a) of this section, a surplus lines broker that holds a certificate of qualification under Title 3, Subtitle 3 of this article may charge a reasonable policy fee on a policy issued by a surplus lines insurer to an exempt commercial policyholder, as defined in § 11–206(j) of this article.</text> </level> <level label="2"> <text>Notwithstanding subsection (a) of this section, a surplus lines broker that holds a certificate of qualification under Title 3, Subtitle 3 of this article may charge a reasonable policy fee on a policy issued by a surplus lines insurer not exceeding:</text> <level label="i"> <text>$200 on each personal lines policy procured by a licensed insurance producer not affiliated with or controlled by the surplus lines broker and to whom the surplus lines broker pays a commission; or</text> </level> <level label="ii"> <text>$500 or 7% of the policy premium, whichever is greater, on each commercial lines policy procured by a licensed insurance producer not affiliated with or controlled by the surplus lines broker and to whom the surplus lines broker pays a commission.</text> </level> </level> <level label="3"> <text>A surplus lines broker that holds a certificate of qualification under Title 3, Subtitle 3 of this article and a license as an insurance producer under Title 10, Subtitle 1 of this article may charge a reasonable policy fee on a policy issued by an authorized insurer not exceeding $500 or 7% of the policy premium, whichever is greater, on each commercial lines policy procured by a licensed insurance producer not affiliated with or controlled by the surplus lines broker and to whom the surplus lines broker pays a commission.</text> </level> <level label="4"> <text>The policy fee charged in accordance with this subsection must be reasonably related to the cost of underwriting, issuing, processing, and servicing the policy by the surplus lines broker for the surplus lines insurer or the authorized insurer.</text> </level> <level label="5"> <text>Notwithstanding subsection (a) of this section, a surplus lines broker that holds a certificate of qualification under Title 3, Subtitle 3 of this article may recoup from the prospective insured the actual cost of an inspection required for the placement of surplus lines insurance with a surplus lines insurer if:</text> <level label="i"> <text>the inspection is required by the surplus lines insurer;</text> </level> <level label="ii"> <text>the cost of the inspection is actually incurred by the surplus lines broker and not retained by the surplus lines broker; and</text> </level> <level label="iii"> <text>the cost of the inspection is documented and verifiable.</text> </level> </level> <level label="6"> <text>A surplus lines broker that holds a certificate of qualification under Title 3, Subtitle 3 of this article and a license as an insurance producer under Title 10, Subtitle 1 of this article may recoup from the prospective insured the actual cost of an inspection required for the placement of insurance with an authorized insurer if:</text> <level label="i"> <text>the inspection is required by the authorized insurer;</text> </level> <level label="ii"> <text>the cost of the inspection is actually incurred by the surplus lines broker and not retained by the surplus lines broker; and</text> </level> <level label="iii"> <text>the cost of the inspection is documented and verifiable.</text> </level> </level> <level label="7"> <text>Regardless of the number of insurers participating on a risk:</text> <level label="i"> <text>only one inspection fee may be charged to recoup the actual cost of an inspection under paragraphs (5) and (6) of this subsection for each policy or certificate of coverage; and</text> </level> <level label="ii"> <text>only one policy fee may be charged under paragraph (2) or (3) of this subsection for each policy or certificate of coverage.</text> </level> </level> <level label="8"> <level label="i"> <text>Subject to subparagraph (ii) of this paragraph, a surplus lines broker that holds a certificate of qualification under Title 3, Subtitle 3 of this article may charge and collect from an insured actual expenses incurred by the surplus lines broker for payment of the premium, policy fee, and any other fees and taxes relating to the policy by use of a credit card.</text> </level> <level label="ii"> <text>Any point of service credit card expenses may not be considered premium for any purpose under this paragraph.</text> </level> </level> <level label="9"> <text>On a form approved by the Commissioner, the surplus lines broker shall:</text> <level label="i"> <text>make a clear and conspicuous written disclosure of:</text> <level label="1"> <text>any inspection fee;</text> </level> <level label="2"> <text>the total amount of the policy fee;</text> </level> <level label="3"> <text>the premium tax on the policy;</text> </level> <level label="4"> <text>any financial interest in the person performing the inspection, if applicable;</text> </level> <level label="5"> <text>whether the surplus lines broker will receive compensation from the person that performs the inspection; and</text> </level> <level label="6"> <text>any charge for actual expenses incurred by the surplus lines broker for payment of the premium, policy fee, and any other fees and taxes relating to the policy by use of a credit card; and</text> </level> </level> <level label="ii"> <text>notify the prospective insured of the option to obtain the inspection from another person who meets the requirements of or is approved by the surplus lines insurer.</text> </level> </level> </level> <level label="e"> <level label="1"> <level label="i"> <text>In this subsection, “accident history report” means a report that details an individual’s accident history.</text> </level> <level label="ii"> <text>“Accident history report” includes a comprehensive loss underwriting exchange automobile report (CLUE report).</text> </level> <level label="iii"> <text>“Accident history report” does not include a report that details an individual’s credit standing or history.</text> </level> </level> <level label="2"> <level label="i"> <text>The Maryland Automobile Insurance Fund may sponsor a fund producer or premium finance company registered under Title 23 of this article for the purpose of obtaining accident history reports directly from a person that provides accident history reports.</text> </level> <level label="ii"> <text>When placing automobile insurance through the Fund, a fund producer or premium finance company sponsored by the Fund under this paragraph may obtain accident history reports directly from a person that provides accident history reports.</text> </level> </level> <level label="3"> <text>Unless provided otherwise by the Fund, a person that provides accident history reports to a fund producer or premium finance company sponsored by the Fund under paragraph (2) of this subsection shall direct all billing for the reports to the fund producer or premium finance company.</text> </level> <level label="4"> <text>Subsection (b)(1) of this section does not prohibit a fund producer or premium finance company from charging and collecting actual expenses that are imposed by a person for providing accident history reports under this subsection in connection with the placement of automobile insurance through the Fund.</text> </level> </level> <level label="f"> <text>In addition to any other sanction otherwise applicable, a person that violates subsection (b)(1) of this section with regard to a bail bond is subject to a penalty not exceeding $5,000 for each violation.</text> </level> <level label="g"> <level label="1"> <level label="i"> <text>In this subsection the following words have the meanings indicated.</text> </level> <level label="ii"> <text>“Administrative service” means a service, other than a service related to the sale, solicitation, negotiation, or servicing of a health benefit plan, that an insurance producer provides to assist an employer in:</text> <level label="1"> <text>complying with a statutory or regulatory requirement;</text> </level> <level label="2"> <text>providing an employee benefit on behalf of the employer; or</text> </level> <level label="3"> <text>performing functions related to the management of employees of the employer.</text> </level> </level> <level label="iii"> <text>“Health benefit plan” has the meaning stated in § 2–112.2 of this article.</text> </level> </level> <level label="2"> <level label="i"> <text>Notwithstanding subsection (a) of this section and subject to subparagraph (ii) of this paragraph, an insurance producer who is licensed under Title 10 of this article to sell health insurance may charge reasonable fees for an administrative service that is sold by the insurance producer to an employer.</text> </level> <level label="ii"> <text>An insurance producer may not charge fees under this subsection for services that are:</text> <level label="1"> <text>compensated by commissions or other compensation paid to the insurance producer by an insurer, nonprofit health service plan, or health maintenance organization related to a health benefit plan of an employer; or</text> </level> <level label="2"> <text>performed by the insurance producer acting as an administrator under Title 8, Subtitle 3 of this article or an adviser under Title 10, Subtitle 2 of this article.</text> </level> </level> </level> <level label="3"> <text>Before a fee for administrative services is charged, an insurance producer, on a form adopted by the Commissioner by regulation, shall disclose in a clear and conspicuous manner:</text> <level label="i"> <text>each administrative service to be provided;</text> </level> <level label="ii"> <text>the fee for each administrative service to be provided; and</text> </level> <level label="iii"> <text>if the insurance producer sells a health benefit plan to the employer, the amount of commission or other compensation that the insurance producer will receive from an insurer, nonprofit health service plan, or health maintenance organization related to the health benefit plan.</text> </level> </level> <level label="4"> <text>The disclosure form required under paragraph (3) of this subsection shall be:</text> <level label="i"> <text>signed by the insurance producer and an authorized representative of the employer; and</text> </level> <level label="ii"> <text>retained by the insurance producer as required by regulations adopted by the Commissioner.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-217" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>This section does not apply to:</text> <level label="1"> <text>life insurance;</text> </level> <level label="2"> <text>health insurance;</text> </level> <level label="3"> <text>annuity contracts; or</text> </level> <level label="4"> <text>a pooling arrangement by athletic clubs, charitable organizations, community associations, homeowners’ associations, and public entities under Title 19, Subtitle 6 of this article to purchase insurance under this section.</text> </level> </level> <level label="b"> <text>An authorized insurer or unauthorized insurer may not make available to a firm, corporation, or association of individuals through a rating plan or form, property insurance, casualty insurance, or surety insurance at a preferred rate or premium based on a fictitious group of the firm, corporation, or association of individuals.</text> </level> <level label="c"> <text>A form or plan of insurance that covers a group or combination of persons or risks may not be written or delivered in or outside the State to cover persons or risks in the State at a preferred rate or on a form other than the rate or form offered to the public generally, including persons not in the group or combination, unless the form, plan of insurance, and rates or premiums to be charged have been submitted to and approved by the Commissioner as:</text> <level label="1"> <text>not unfairly discriminatory; and</text> </level> <level label="2"> <text>not otherwise in conflict with subsection (b) of this section or, to the extent applicable, Title 11, Subtitle 2 of this article.</text> </level> </level> <level label="d"> <text>The Commissioner shall adopt regulations to carry out subsection (c) of this section as it applies to property insurance or casualty insurance on motor vehicles.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-218" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>All burial insurance benefits shall be paid in cash to the beneficiary.</text> </level> <level label="b"> <text>A person engaged in the business of burial insurance may not pay or contract to pay wholly or partly burial insurance or its benefits to:</text> <level label="1"> <text>an official mortician, funeral director, or undertaker;</text> </level> <level label="2"> <text>a designated mortician, funeral director, undertaker, or funeral directing or undertaking concern; or</text> </level> <level label="3"> <text>a particular tradesperson or businessperson.</text> </level> </level> <level label="c"> <text>This section does not apply to life insurance or an annuity used to fund a pre-need contract as defined in § 7-101 of the Health Occupations Article or a preneed burial contract as defined in § 5-701 of the Business Regulation Article.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-219" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>A person that is not an insurer may not assume or use a name that deceptively implies or suggests that it is an insurer.</text> </section> <section article="gin" article_name="Insurance" number="27-220" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>An insurance producer or insurer may not refer an individual employee or dependent of an employee to the Maryland Children’s Health Program established under Title 15, Subtitle 3 of the Health - General Article or arrange for an individual employee or dependent of an employee to apply for the Maryland Children’s Health Program established under Title 15, Subtitle 3 of the Health - General Article if the insurance producer or insurer has an economic interest in the referral or the arrangement and the insurance producer’s or insurer’s sole purpose is to separate that employee or that employee’s dependent from group health insurance coverage provided in connection with the employee’s employment.</text> </section> <section article="gin" article_name="Insurance" number="27-221" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Carrier” means a person that is:</text> <level label="i"> <text>an insurer that holds a certificate of authority in the State and provides health insurance in the State;</text> </level> <level label="ii"> <text>a health maintenance organization that holds a certificate of authority to operate in the State; or</text> </level> <level label="iii"> <text>a nonprofit health service plan that holds a certificate of authority to operate in the State.</text> </level> </level> <level label="3"> <text>“Health coverage” means any of the following:</text> <level label="i"> <text>a health insurance contract that is issued or delivered in the State by an insurer;</text> </level> <level label="ii"> <text>a contract that is issued or delivered in the State by a nonprofit health service plan; or</text> </level> <level label="iii"> <text>a contract that is issued or delivered in the State by a health maintenance organization.</text> </level> </level> <level label="4"> <text>“Health status-related factor” has the meaning stated in § 15-1301 of this article.</text> </level> <level label="5"> <text>“Individual contract” means a contract between a carrier and an individual covering:</text> <level label="i"> <text>the individual;</text> </level> <level label="ii"> <text>the individual and the individual’s family members; or</text> </level> <level label="iii"> <text>the family members of the individual.</text> </level> </level> <level label="6"> <level label="i"> <text>“Reunderwrite” means to reevaluate any health status-related factor, occupation, hobby, or activity of an individual for the purpose of:</text> <level label="1"> <text>terminating health coverage of the individual; or</text> </level> <level label="2"> <text>moving the individual from a more favorable rate class to a less favorable rate class.</text> </level> </level> <level label="ii"> <text>“Reunderwrite” does not include:</text> <level label="1"> <text>moving an individual from one rate tier to another rate tier solely due to the addition or deletion of a family member under the health coverage;</text> </level> <level label="2"> <text>increasing the premium under an attained age rated contract solely due to the increasing age of the individual covered under the health coverage;</text> </level> <level label="3"> <text>on receipt of an application from an insured to increase the benefits under an existing contract, evaluating the health status-related factors, occupation, hobbies, or activities of the insured for the purpose of increasing the benefits under the contract; or</text> </level> <level label="4"> <text>during the period in which a carrier has the right to contest a policy, denying a claim, amending the policy, making an adjustment to the premium, or rescinding the policy based on a material misrepresentation or fraud in the application.</text> </level> </level> </level> </level> <level label="b"> <text>A carrier may not reunderwrite an individual for health coverage under an individual contract after the individual contract has been issued.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-222" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>A person may not violate § 15–112(h) of this article.</text> </section> <section article="gin" article_name="Insurance" number="27-223" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>It is unlawful for any insurance producer to use a senior or retiree credential or designation in a way that is or would be misleading in connection with the offer, sale, or purchase of life insurance, health insurance, or annuities.</text> </level> <level label="b"> <level label="1"> <text>The Commissioner, in consultation with the Securities Commissioner of the Division of Securities in the Office of the Attorney General, shall adopt regulations to define what constitutes a misleading use of a senior or retiree credential or designation for purposes of subsection (a) of this section.</text> </level> <level label="2"> <text>The regulations adopted by the Commissioner may provide exemptions from subsection (a) of this section, if the exemptions are consistent with the public interest and within the purposes intended by the policy and provisions of this title.</text> </level> </level> <level label="c"> <text>A violation of subsection (a) of this section constitutes a lack of trustworthiness for the purposes of § 10–126(a)(13) of this article.</text> </level> <level label="d"> <text>This section may not be construed to limit any powers of the Commissioner granted under this title.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-224" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <text>When soliciting or advertising the sale of a Medicare Advantage Plan, Medicare Advantage Prescription Drug Plan, Medicare Prescription Drug Plan (Part D), or Medicare Section 1876 cost plan, an insurance producer shall comply with the Centers for Medicare and Medicaid Services’ Medicare Marketing Guidelines, as may be amended from time to time, including the prohibitions against:</text> <level label="1"> <text>engaging in door–to–door solicitation, including leaving written information at a residence or on a vehicle;</text> </level> <level label="2"> <text>approaching a Medicare beneficiary in a common area, including a parking lot, hallway, lobby, or sidewalk; and</text> </level> <level label="3"> <text>engaging in telephone or electronic solicitation.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-225" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="2" subtitle_name="Unfair Methods of Competition and Unfair and Deceptive Acts or Practices"> <level label="a"> <text>In this section “bail bond” has the meaning stated in § 10–301 of this article.</text> </level> <level label="b"> <text>A confessed judgment clause that waives a consumer’s right to assert a legal defense to an action may not be included in a bail bond agreement.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-301" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="3" subtitle_name="Unfair Claim Settlement Practices"> <level label="a"> <text>The intent of this subtitle is to provide an additional administrative remedy to a claimant for a violation of this subtitle or a regulation that relates to this subtitle.</text> </level> <level label="b"> <level label="1"> <text>This subtitle provides administrative remedies only.</text> </level> <level label="2"> <text>This subtitle does not provide or prohibit a private right or cause of action to, or on behalf of, a claimant or other person in any state.</text> </level> <level label="3"> <text>This subtitle does not impair the right of a person to seek redress in law or equity for conduct that otherwise is actionable.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-302" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="3" subtitle_name="Unfair Claim Settlement Practices"> <level label="a"> <text>This subtitle applies to each individual or group policy, contract, or certificate of an insurer, nonprofit health service plan, or health maintenance organization that:</text> <level label="1"> <text>is delivered or issued in the State;</text> </level> <level label="2"> <text>is issued to a group that has a main office in the State; or</text> </level> <level label="3"> <text>covers individuals who reside or work in the State.</text> </level> </level> <level label="b"> <text>This subtitle does not apply to:</text> <level label="1"> <text>reinsurance;</text> </level> <level label="2"> <text>workers’ compensation insurance; or</text> </level> <level label="3"> <text>surety insurance.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-303" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="3" subtitle_name="Unfair Claim Settlement Practices"> <text>It is an unfair claim settlement practice and a violation of this subtitle for an insurer, nonprofit health service plan, or health maintenance organization to:</text> <level label="1"> <text>misrepresent pertinent facts or policy provisions that relate to the claim or coverage at issue;</text> </level> <level label="2"> <text>refuse to pay a claim for an arbitrary or capricious reason based on all available information;</text> </level> <level label="3"> <text>attempt to settle a claim based on an application that is altered without notice to, or the knowledge or consent of, the insured;</text> </level> <level label="4"> <text>fail to include with each claim paid to an insured or beneficiary a statement of the coverage under which payment is being made;</text> </level> <level label="5"> <text>fail to settle a claim promptly whenever liability is reasonably clear under one part of a policy, in order to influence settlements under other parts of the policy;</text> </level> <level label="6"> <text>fail to provide promptly on request a reasonable explanation of the basis for a denial of a claim;</text> </level> <level label="7"> <text>fail to meet the requirements of Title 15, Subtitle 10B of this article for preauthorization for a health care service;</text> </level> <level label="8"> <text>fail to comply with the provisions of Title 15, Subtitle 10A of this article;</text> </level> <level label="9"> <text>fail to act in good faith, as defined under § 27–1001 of this title, in settling a first–party claim under a policy of property and casualty insurance; or</text> </level> <level label="10"> <text>fail to comply with the provisions of § 16–118 of this article.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-304" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="3" subtitle_name="Unfair Claim Settlement Practices"> <text>It is an unfair claim settlement practice and a violation of this subtitle for an insurer, nonprofit health service plan, or health maintenance organization, when committed with the frequency to indicate a general business practice, to:</text> <level label="1"> <text>misrepresent pertinent facts or policy provisions that relate to the claim or coverage at issue;</text> </level> <level label="2"> <text>fail to acknowledge and act with reasonable promptness on communications about claims that arise under policies;</text> </level> <level label="3"> <text>fail to adopt and implement reasonable standards for the prompt investigation of claims that arise under policies;</text> </level> <level label="4"> <text>refuse to pay a claim without conducting a reasonable investigation based on all available information;</text> </level> <level label="5"> <text>fail to affirm or deny coverage of claims within a reasonable time after proof of loss statements have been completed;</text> </level> <level label="6"> <text>fail to make a prompt, fair, and equitable good faith attempt, to settle claims for which liability has become reasonably clear;</text> </level> <level label="7"> <text>compel insureds to institute litigation to recover amounts due under policies by offering substantially less than the amounts ultimately recovered in actions brought by the insureds;</text> </level> <level label="8"> <text>attempt to settle a claim for less than the amount to which a reasonable person would expect to be entitled after studying written or printed advertising material accompanying, or made part of, an application;</text> </level> <level label="9"> <text>attempt to settle a claim based on an application that is altered without notice to, or the knowledge or consent of, the insured;</text> </level> <level label="10"> <text>fail to include with each claim paid to an insured or beneficiary a statement of the coverage under which the payment is being made;</text> </level> <level label="11"> <text>make known to insureds or claimants a policy of appealing from arbitration awards in order to compel insureds or claimants to accept a settlement or compromise less than the amount awarded in arbitration;</text> </level> <level label="12"> <text>delay an investigation or payment of a claim by requiring a claimant or a claimant’s licensed health care provider to submit a preliminary claim report and subsequently to submit formal proof of loss forms that contain substantially the same information;</text> </level> <level label="13"> <text>fail to settle a claim promptly whenever liability is reasonably clear under one part of a policy, in order to influence settlements under other parts of the policy;</text> </level> <level label="14"> <text>fail to provide promptly a reasonable explanation of the basis for denial of a claim or the offer of a compromise settlement;</text> </level> <level label="15"> <text>refuse to pay a claim for an arbitrary or capricious reason based on all available information;</text> </level> <level label="16"> <text>fail to meet the requirements of Title 15, Subtitle 10B of this article for preauthorization for a health care service;</text> </level> <level label="17"> <text>fail to comply with the provisions of Title 15, Subtitle 10A of this article; or</text> </level> <level label="18"> <text>fail to act in good faith, as defined under § 27–1001 of this title, in settling a first–party claim under a policy of property and casualty insurance.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-304.1" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="3" subtitle_name="Unfair Claim Settlement Practices"> <text>The Commissioner shall adopt regulations that establish standards and procedures for:</text> <level label="1"> <text>the settlement of claims involving the total loss of a private passenger motor vehicle; and</text> </level> <level label="2"> <text>the determination of the private passenger motor vehicle’s total loss value.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-305" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="3" subtitle_name="Unfair Claim Settlement Practices"> <level label="a"> <text>The Commissioner may impose a penalty:</text> <level label="1"> <text>not exceeding $2,500 for each violation of § 27–303 of this subtitle or a regulation adopted under § 27–303 of this subtitle; and</text> </level> <level label="2"> <text>not exceeding $125,000 for each violation of § 27–303(9) of this subtitle or a regulation adopted under § 27–303(9) of this subtitle.</text> </level> </level> <level label="b"> <text>The penalty for a violation of § 27–304 of this subtitle is as provided in §§ 1–301, 4–113, and 4–114 of this article and § 27–103 of this title.</text> </level> <level label="c"> <level label="1"> <text>On finding a violation of this subtitle, the Commissioner may require an insurer, nonprofit health service plan, or health maintenance organization to:</text> <level label="i"> <text>make restitution to each claimant who has suffered actual economic damage because of the violation; or</text> </level> <level label="ii"> <text>provide to a claimant a payment that has been determined to be denied in violation of this subtitle.</text> </level> </level> <level label="2"> <text>Subject to paragraph (3) of this subsection, restitution may not exceed the amount of actual economic damage sustained, subject to the limits of any applicable policy.</text> </level> <level label="3"> <text>For a violation of § 27–303(9) of this subtitle, the Commissioner may require restitution to an insured for the following:</text> <level label="i"> <text>actual damages, which actual damages may not exceed the limits of any applicable policy;</text> </level> <level label="ii"> <text>expenses and litigation costs incurred by the insured in pursuing an administrative complaint under § 27–303(9) of this subtitle, including reasonable attorney’s fees; and</text> </level> <level label="iii"> <text>interest on all actual damages, expenses, and litigation costs incurred by the insured computed:</text> <level label="1"> <text>at the rate allowed under § 11–107(a) of the Courts Article; and</text> </level> <level label="2"> <text>from the date on which the insured’s claim would have been paid if the insurer acted in good faith.</text> </level> </level> </level> <level label="4"> <text>The amount of attorney’s fees recovered from an insurer under paragraph (3) of this subsection may not exceed one–third of the actual damages recovered.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-306" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="3" subtitle_name="Unfair Claim Settlement Practices"> <text>An appeal from an order issued by the Commissioner under this subtitle shall be taken in accordance with § 2-215 of this article.</text> </section> <section article="gin" article_name="Insurance" number="27-401" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <level label="a"> <text>In this subtitle the following words have the meanings indicated.</text> </level> <level label="b"> <level label="1"> <text>“Claim” means a demand for payment or benefit under a policy or contract by an insured, third party, or representative of the insured or third party.</text> </level> <level label="2"> <text>“Claim” includes a demand for payment or benefit made against:</text> <level label="i"> <text>the State under Title 12 of the State Government Article, Title 2, Subtitle 5 of the State Personnel and Pensions Article, or Title 9 of the Labor and Employment Article; or</text> </level> <level label="ii"> <text>the Maryland Transit Administration when acting as a self–insurer under § 7–703 of the Transportation Article.</text> </level> </level> </level> <level label="c"> <text>“Motor vehicle accident” means an occurrence involving a motor vehicle that results in damage to property or injury to a person.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-402" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <text>The provisions of this subtitle that apply to insurers also apply to:</text> <level label="1"> <text>a corporation that operates a nonprofit health service plan under Title 14, Subtitle 2 of this article;</text> </level> <level label="2"> <text>a dental plan organization as defined in § 14–401 of this article;</text> </level> <level label="3"> <text>a health maintenance organization as defined in Title 19, Subtitle 7 of the Health – General Article;</text> </level> <level label="4"> <text>a surplus lines insurer;</text> </level> <level label="5"> <text>the Maryland Automobile Insurance Fund;</text> </level> <level label="6"> <text>the State when a claim has been filed against the State under Title 12 of the State Government Article;</text> </level> <level label="7"> <text>the State when a claim has been filed against the State under Title 2, Subtitle 5 of the State Personnel and Pensions Article;</text> </level> <level label="8"> <text>the State, including the Uninsured Employers’ Fund, when a claim has been filed against the State under Title 9 of the Labor and Employment Article;</text> </level> <level label="9"> <text>the Maryland Transit Administration when acting as a self–insurer under § 7–703 of the Transportation Article;</text> </level> <level label="10"> <text>a third party administrator under Title 8, Subtitle 3 of this article;</text> </level> <level label="11"> <text>a self–insurer under § 17–103(a)(2) of the Transportation Article;</text> </level> <level label="12"> <text>the Maryland Health Insurance Plan;</text> </level> <level label="13"> <text>a governmental self–insurer group formed in accordance with § 9–404 of the Labor and Employment Article;</text> </level> <level label="14"> <text>an employer who self–insures or participates in a self–insurance group in accordance with § 9–405 of the Labor and Employment Article; and</text> </level> <level label="15"> <text>an agent, employee, or representative of an entity described in items (1) through (14) of this section.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-403" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <text>It is a fraudulent insurance act for a person:</text> <level label="1"> <text>knowingly to fail to return any money or premiums paid for a policy to an insured, designee of the insured, or another person entitled to the money or premiums if the insurance contracted for is not ultimately provided;</text> </level> <level label="2"> <text>to present or cause to be presented to an insurer documentation or an oral or written statement made in support of a claim, including a claim that alleges the theft of a motor vehicle, with knowledge that the documentation or statement contains false or misleading information about a matter material to the claim;</text> </level> <level label="3"> <text>except for the prepayment of periodic payments or excess contributions allowed under the terms of the policy, willfully to collect as a premium a sum in excess of the premium applicable to the insurance under approved classifications and rates or, for cases in which classifications and rates are not subject to approval, the premiums and charges applicable to the insurance as specified in the policy and set by the insurer;</text> </level> <level label="4"> <text>to misappropriate or withhold unreasonably funds received or held if the funds represent premiums or return premiums;</text> </level> <level label="5"> <text>to misappropriate benefits under a policy; and</text> </level> <level label="6"> <text>knowingly or willfully to present, or cause to be presented, documentation or an oral or written statement made in, with reference to, or in support of an application for a viatical settlement contract, the financing of a viatical settlement contract, the transfer of a viatical settlement contract, or the settlement in support of a claim made under a viatical settlement contract with knowledge that the documentation or statement contains false or misleading information about matters material to the application, financing, transfer, settlement, or claim.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-404" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <text>It is a fraudulent insurance act for an insurer doing business in the State knowingly to write or place a policy or insurance contract in the State through, or pay a commission or other consideration to, a person that is required to have a certificate of qualification under this article but does not have a certificate of qualification.</text> </section> <section article="gin" article_name="Insurance" number="27-405" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <level label="a"> <text>It is a fraudulent insurance act for a person to act as or represent to the public that the person is:</text> <level label="1"> <text>an insurance producer or a public adjuster in the State if the person has not received the appropriate license under or otherwise complied with Title 10 of this article;</text> </level> <level label="2"> <text>a navigator of the Small Business Health Options Program of the Maryland Health Benefit Exchange if the person has not received the appropriate license under or otherwise complied with § 31–112 of this article;</text> </level> <level label="3"> <text>a navigator of the Individual Exchange of the Maryland Health Benefit Exchange if the person has not received the appropriate certification under or otherwise complied with § 31–113 of this article; or</text> </level> <level label="4"> <text>an application counselor certified by the Individual Exchange of the Maryland Health Benefit Exchange if the person has not received the appropriate certification under or otherwise complied with § 31–113(r) of this article.</text> </level> </level> <level label="b"> <text>It is a fraudulent insurance act for an insurance producer:</text> <level label="1"> <text>to solicit or take application for, procure, or place for others insurance for which the insurance producer has not obtained an appropriate license;</text> </level> <level label="2"> <text>knowingly to violate § 10–130 of this article; or</text> </level> <level label="3"> <text>intentionally to fail to report to an insurer the exact amount of consideration charged as a premium for an insurance contract, if different from the policy premium, and to fail to maintain records that show that information.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-406" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <text>It is a fraudulent insurance act for a person:</text> <level label="1"> <text>knowingly or willfully to make a false or fraudulent statement or representation in or with reference to an application for insurance;</text> </level> <level label="2"> <text>to place insurance with an unauthorized insurer not regulated by the Commissioner and refuse to obey an order of the Commissioner to produce for examination all policies and other documents that evidence the insurance and the amount of premiums paid or agreed to be paid for the insurance;</text> </level> <level label="3"> <text>if a certificate of authority is required, to operate an insurer or conduct an insurance business without obtaining a certificate of authority issued by the Commissioner;</text> </level> <level label="4"> <text>to make a false sworn statement that the person does not believe to be true about matter material to an examination, investigation, or hearing conducted by the Commissioner; or</text> </level> <level label="5"> <text>with intent to deceive, knowingly to exhibit a false account, document, or advertisement about the affairs of an insurer.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-406.1" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <level label="a"> <text>In this section, “individual surety” means a person that:</text> <level label="1"> <text>issues surety bonds or contracts of surety insurance; and</text> </level> <level label="2"> <text>does not have a certificate of authority issued by the Commissioner.</text> </level> </level> <level label="b"> <text>It is a fraudulent insurance act for an individual surety to solicit or issue a surety bond or contract of surety insurance except as provided in:</text> <level label="1"> <text>§§ 13–207 and 17–104 of the State Finance and Procurement Article; and</text> </level> <level label="2"> <text>for an uncompensated person, §§ 5–203 and 5–204 of the Criminal Procedure Article.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-407" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <level label="a"> <text>It is a fraudulent insurance act for:</text> <level label="1"> <text>a person, for personal gain, to solicit an individual injured by or in a motor vehicle to sue or retain a lawyer to represent that individual in a lawsuit;</text> </level> <level label="2"> <text>a person, for personal gain, to solicit an individual injured by or in a motor vehicle to seek care from a health care practitioner; and</text> </level> <level label="3"> <text>a lawyer or health care practitioner to employ, directly or indirectly, or in any way compensate a person for the purpose of having that person solicit or attempt to solicit clients for the lawyer or health care practitioner.</text> </level> </level> <level label="b"> <text>This section does not prohibit public communications or activity allowed by applicable rules of professional conduct or activity protected under the State or federal Constitution.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-407.1" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <text>It is a fraudulent insurance act for a person, with the purpose of submitting a claim under a policy of motor vehicle insurance, to organize, plan, or knowingly participate in:</text> <level label="1"> <text>an intentional motor vehicle accident; or</text> </level> <level label="2"> <text>a scheme to create documentation of a motor vehicle accident that did not occur.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-407.2" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <text>It is a fraudulent insurance act for a contractor offering home repair or remodeling services for damages to a private residence, to directly or indirectly pay or otherwise compensate an insured, or offer or promise to pay or compensate an insured, with the intent to defraud an insurer, for any part of the insured’s deductible under the insured’s property or casualty insurance policy, if payment for the services will be made from the proceeds of the policy.</text> </section> <section article="gin" article_name="Insurance" number="27-408" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="4" subtitle_name="Fraudulent Insurance Acts"> <level label="a"> <level label="1"> <text>A person that violates § 27–407 of this subtitle, or another provision of this subtitle in which the claim or act that is the subject of the fraud has a value of $300 or more is guilty of a felony and on conviction, for each violation, is subject to:</text> <level label="i"> <text>liability for restoring to the victim the property taken or the value of the property taken; and</text> </level> <level label="ii"> <level label="1"> <text>for a violation of any provision of § 27–403 of this subtitle, a fine, the maximum of which is the greater of three times the value of the claim or act that is the subject of the fraud and $10,000 and the minimum of which is $500, or imprisonment not exceeding 15 years or both; and</text> </level> <level label="2"> <text>for a violation of any provision of § 27–404, § 27–405, § 27–406, § 27–406.1, § 27–407, § 27–407.1, or § 27–407.2 of this subtitle, a fine not exceeding $10,000 or imprisonment not exceeding 15 years or both.</text> </level> </level> </level> <level label="2"> <text>A person that violates a provision of this subtitle in which the claim or act that is the subject of the fraud has a value of less than $300 is guilty of a misdemeanor and on conviction, for each violation, is subject to:</text> <level label="i"> <text>liability for restoring to the victim the property taken or the value of the property taken; and</text> </level> <level label="ii"> <level label="1"> <text>for a violation of any provision of § 27–403 of this subtitle, a fine, the maximum of which is the greater of three times the value of the claim or act that is the subject of the fraud and $10,000 and the minimum of which is $500, or imprisonment not exceeding 18 months or both; and</text> </level> <level label="2"> <text>for a violation of any provision of § 27–404, § 27–405, § 27–406, § 27–406.1, § 27–407, § 27–407.1, or § 27–407.2 of this subtitle, a fine not exceeding $10,000 or imprisonment not exceeding 18 months or both.</text> </level> </level> </level> </level> <level label="b"> <level label="1"> <text>The penalties imposed under this section may be imposed separately from and consecutively to or concurrently with a sentence for another offense based on the act that constitutes a violation of this subtitle.</text> </level> <level label="2"> <text>Each act of solicitation under § 27–407 of this subtitle constitutes a separate violation for purposes of the penalties imposed under this section.</text> </level> <level label="3"> <text>Notwithstanding any other provision of law, a fine imposed under subsection (a) of this section is mandatory and not subject to suspension.</text> </level> </level> <level label="c"> <level label="1"> <text>In addition to any criminal penalties that may be imposed under this section, on a showing by clear and convincing evidence that a violation of this subtitle has occurred, the Commissioner may:</text> <level label="i"> <text>impose an administrative penalty not exceeding $25,000 for each act of insurance fraud; and</text> </level> <level label="ii"> <text>order restitution to an insurer or self–insured employer of any insurance proceeds paid relating to a fraudulent insurance claim.</text> </level> </level> <level label="2"> <text>In determining the amount of an administrative penalty, the Commissioner shall consider:</text> <level label="i"> <text>the nature, circumstances, extent, gravity, and number of violations;</text> </level> <level label="ii"> <text>the degree of culpability of the violator;</text> </level> <level label="iii"> <text>prior offenses and repeated violations of the violator; and</text> </level> <level label="iv"> <text>any other matter that the Commissioner considers appropriate and relevant.</text> </level> </level> <level label="3"> <text>If an administrative penalty is not paid after all rights of appeal have been waived or exhausted, the Commissioner may bring a civil action in a court of competent jurisdiction to collect the administrative penalty, including expenses and litigation costs, reasonable attorney’s fees, and interest.</text> </level> </level> <level label="d"> <text>This section does not affect an insurer’s right to take any independent action to seek recovery against a person that violates this subtitle.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-501" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="5" subtitle_name="Discrimination"> <level label="a"> <level label="1"> <text>An insurer or insurance producer may not cancel or refuse to underwrite or renew a particular insurance risk or class of risk for a reason based wholly or partly on race, color, creed, sex, or blindness of an applicant or policyholder or for any arbitrary, capricious, or unfairly discriminatory reason.</text> </level> <level label="2"> <text>Except as provided in this section, an insurer or insurance producer may not cancel or refuse to underwrite or renew a particular insurance risk or class of risk except by the application of standards that are reasonably related to the insurer’s economic and business purposes.</text> </level> </level> <level label="b"> <level label="1"> <text>An insurer may not require special conditions, facts, or situations as a condition to its acceptance or renewal of a particular insurance risk or class of risks in an arbitrary, capricious, unfair, or discriminatory manner based wholly or partly on race, creed, color, sex, religion, national origin, place of residency, blindness, or other physical handicap or disability.</text> </level> <level label="2"> <text>Actuarial justification may be considered with respect to sex.</text> </level> </level> <level label="c"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection, an insurer or insurance producer may not make an inquiry about race, creed, color, or national origin in an insurance form, questionnaire, or other manner of requesting general information that relates to an application for insurance.</text> </level> <level label="2"> <text>Subject to § 27–914 of this title, an insurer that provides health insurance, a nonprofit health service plan, or a health maintenance organization may make an inquiry about race and ethnicity in an insurance form, questionnaire, or other manner requesting general information, provided the information is used solely for the evaluation of quality of care outcomes and performance measurements, including the collection of information required under § 19–134 of the Health – General Article.</text> </level> </level> <level label="d"> <level label="1"> <level label="i"> <text>With respect to automobile liability insurance, an insurer may not:</text> <level label="1"> <text>cancel, refuse to renew, or otherwise terminate coverage for an automobile insurance risk because of a claim, traffic violation, or traffic accident that occurred more than 3 years before the effective date of the policy or renewal;</text> </level> <level label="2"> <text>refuse to underwrite an automobile insurance risk because of a claim, traffic violation, or traffic accident that occurred more than 3 years before the date of application; or</text> </level> <level label="3"> <text>subject to subparagraph (ii) of this paragraph, cancel, refuse to renew, or otherwise terminate coverage for a private passenger motor vehicle insurance policy because of a claim under the towing or emergency roadside service coverage in the policy.</text> </level> </level> <level label="ii"> <text>An insurer may:</text> <level label="1"> <text>remove the towing or emergency roadside service coverage at renewal from a private passenger motor vehicle insurance policy based on the number of claims made under the towing or emergency roadside service coverage in a manner that complies with § 27–613 of this title; and</text> </level> <level label="2"> <text>increase the premium of the private passenger motor vehicle insurance policy as a result of a towing or emergency roadside service claim in accordance with its filed rates in a manner that complies with § 11–317 of this article and § 27–614 of this title.</text> </level> </level> </level> <level label="2"> <text>With respect to homeowner’s insurance, an insurer may not:</text> <level label="i"> <text>cancel, refuse to renew, or otherwise terminate coverage for a homeowner’s insurance risk because of a claim that occurred more than 3 years before the effective date of the policy or renewal; or</text> </level> <level label="ii"> <text>refuse to underwrite a homeowner’s insurance risk because of a claim that occurred more than 3 years before the date of application.</text> </level> </level> <level label="3"> <text>An insurer may cancel a policy of homeowner’s insurance under which a onetime guaranteed fully refundable deposit is required for a stated amount of coverage, if the cancellation:</text> <level label="i"> <text>takes effect on the anniversary date of the inception of the policy;</text> </level> <level label="ii"> <text>is not based on a claim that occurred more than 3 years before the anniversary date of the policy on which the proposed cancellation would take effect; and</text> </level> <level label="iii"> <text>is otherwise in accordance with this subtitle.</text> </level> </level> <level label="4"> <text>This subsection does not apply to a claim involving conviction of the insured or applicant for fraud or arson.</text> </level> </level> <level label="e"> <text>An insurer may not refuse to underwrite a private passenger motor vehicle insurance risk solely because the applicant or named insured previously obtained insurance coverage from any authorized insurer or the Maryland Automobile Insurance Fund.</text> </level> <level label="e–1"> <text>An insurer may not require a particular payment plan for an insured for coverage under a private passenger or homeowner’s insurance policy based on the credit history of the insured.</text> </level> <level label="e–2"> <level label="1"> <text>In this subsection, “credit history” means any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer’s creditworthiness, credit standing, or credit capacity that is used or expected to be used, or collected in whole or in part, for the purpose of determining personal lines insurance premiums or eligibility for coverage.</text> </level> <level label="2"> <text>With respect to homeowner’s insurance, an insurer may not:</text> <level label="i"> <text>refuse to underwrite, cancel, or refuse to renew a risk based, in whole or in part, on the credit history of an applicant or insured;</text> </level> <level label="ii"> <text>rate a risk based, in whole or in part, on the credit history of an applicant or insured in any manner, including:</text> <level label="1"> <text>the provision or removal of a discount;</text> </level> <level label="2"> <text>assigning the insured or applicant to a rating tier; or</text> </level> <level label="3"> <text>placing an insured or applicant with an affiliated company; or</text> </level> </level> <level label="iii"> <text>require a particular payment plan based, in whole or in part, on the credit history of the insured or applicant.</text> </level> </level> <level label="3"> <level label="i"> <text>With respect to private passenger motor vehicle insurance, an insurer may not:</text> <level label="1"> <text>refuse to underwrite, cancel, refuse to renew, or increase the renewal premium based, in whole or in part, on the credit history of the insured or applicant; or</text> </level> <level label="2"> <text>require a particular payment plan based, in whole or in part, on the credit history of the insured or applicant.</text> </level> </level> <level label="ii"> <level label="1"> <text>An insurer may, subject to paragraphs (4) and (5) of this subsection, use the credit history of an applicant to rate a new policy of private passenger motor vehicle insurance.</text> </level> <level label="2"> <text>For purposes of this subsection, rating includes:</text> </level> <level label="A"> <text>the provision or removal of a discount;</text> </level> <level label="B"> <text>assigning the applicant to a rating tier; or</text> </level> <level label="C"> <text>placing an applicant with an affiliated company.</text> </level> </level> </level> <level label="4"> <text>With respect to private passenger motor vehicle insurance, an insurer that rates a new policy based, in whole or in part, on the credit history of the applicant:</text> <level label="i"> <text>may not use a factor on the credit history of the applicant that occurred more than 5 years prior to the issuance of the new policy;</text> </level> <level label="ii"> <level label="1"> <text>shall advise an applicant at the time of application that credit history is used; and</text> </level> <level label="2"> <text>shall, on request of the applicant, provide a premium quotation that separately identifies the portion of the premium attributable to the applicant’s credit history;</text> </level> </level> <level label="iii"> <text>may not use the following factors in rating the policy:</text> <level label="1"> <text>the absence of credit history or the inability to determine the applicant’s credit history; or</text> </level> <level label="2"> <text>the number of credit inquiries about an applicant’s credit history;</text> </level> </level> <level label="iv"> <level label="1"> <text>shall review the credit history of an insured who was adversely impacted by the use of the insured’s credit history at the initial rating of the policy:</text> </level> <level label="A"> <text>every 2 years; or</text> </level> <level label="B"> <text>on request of the insured; and</text> </level> <level label="2"> <text>shall adjust the premium of an insured whose credit history was reviewed under this subparagraph to reflect any improvement in the insured’s credit history; or</text> </level> </level> <level label="v"> <text>shall disclose to the applicant at the time of the issuance of a policy that the insurer is required to:</text> <level label="1"> <text>review the credit history of an insured who was adversely impacted by the use of the insured’s credit history at the initial rating or underwriting of the policy:</text> </level> <level label="A"> <text>every 2 years; or</text> </level> <level label="B"> <text>on request of the insured; and</text> </level> <level label="2"> <text>adjust the premium of an insured whose credit history was reviewed to reflect any improvement in the insured’s credit history.</text> </level> </level> </level> <level label="5"> <text>With respect to private passenger motor vehicle insurance, an insurer that rates a new policy based, in whole or in part, on the credit history of the applicant may, if actuarially justified, provide a discount of up to 40% or impose a surcharge of up to 40%.</text> </level> <level label="6"> <text>With respect to private passenger motor vehicle insurance, an insurer may not increase the premium for an insured who becomes a surviving spouse based solely on the insured’s change in marital status.</text> </level> <level label="7"> <text>With respect to homeowner’s insurance, an insurer may not increase the premium for an insured who becomes a surviving spouse based solely on the insured’s change in marital status.</text> </level> <level label="8"> <level label="i"> <text>At the time a policy of private passenger motor vehicle insurance is initially issued, an insurer may consider the applicant’s homeowner’s insurance claim history when rating the policy.</text> </level> <level label="ii"> <text>At renewal, an insurer may not increase the premium for a policy of private passenger motor vehicle insurance based on a homeowner’s insurance claim.</text> </level> </level> <level label="9"> <level label="i"> <text>At the time a policy of homeowner’s insurance is initially issued, an insurer may consider the applicant’s motor vehicle claim history when rating the policy.</text> </level> <level label="ii"> <text>At renewal, an insurer may not increase the premium for a policy of homeowner’s insurance based on a private passenger motor vehicle insurance claim.</text> </level> </level> </level> <level label="f"> <text>Except as provided in § 27–505(a)(2) of this subtitle, in the case of cancellation of or refusal to renew a policy, the policy remains in effect until a finding is issued under § 27–505 of this subtitle if:</text> <level label="1"> <text>the insured asks the Commissioner to review the cancellation or refusal to renew before the effective date of the termination of the policy; and</text> </level> <level label="2"> <text>the Commissioner begins action to issue a finding under § 27–505 of this subtitle.</text> </level> </level> <level label="g"> <text>At a hearing to determine whether this section has been violated, the burden of persuasion is on the insurer to show that the cancellation or refusal to underwrite or renew is justified under the underwriting standards demonstrated.</text> </level> <level label="h"> <level label="1"> <text>This subsection applies to insurance underwriting standards for all health, life, disability, property, and casualty coverages provided in the State.</text> </level> <level label="2"> <text>At the request of the Commissioner, each insurer, nonprofit health service plan, and health maintenance organization shall file with the Commissioner a copy of its underwriting standards, including any amendments or supplements.</text> </level> <level label="3"> <text>The Commissioner may review and examine the underwriting standards to ensure compliance with this article.</text> </level> <level label="4"> <text>Each insurer, nonprofit health service plan, and health maintenance organization may request a finding by the Commissioner that its underwriting standards filed with the Commissioner be considered confidential commercial information under § 4–335 of the General Provisions Article.</text> </level> <level label="5"> <text>The Commissioner shall adopt regulations to carry out this subsection.</text> </level> </level> <level label="i"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection, with respect to homeowner’s insurance, an insurer may not cancel or refuse to renew coverage for homeowner’s insurance based on the claims history of an insured for weather–related claims, unless there were three or more weather–related claims within the preceding 3–year period.</text> </level> <level label="2"> <text>An insurer may consider claims for weather–related events for the purpose of canceling or refusing to renew coverage if the insurer provided written notice to the insured for reasonable or customary repairs or replacement specific to the insured’s premises or dwelling which the insured failed to make and which, if made, would have prevented the loss for which a claim was made.</text> </level> </level> <level label="j"> <level label="1"> <text>In the case of homeowner’s insurance, standards reasonably related to an insurer’s economic and business purpose under subsection (a)(2) of this section, include, but are not limited to, the following and do not require statistical validation:</text> <level label="i"> <text>a material misrepresentation in connection with the application, policy, or presentation of a claim;</text> </level> <level label="ii"> <text>nonpayment of premium;</text> </level> <level label="iii"> <text>a change in the physical condition or contents of the premises or dwelling which results in an increase in a hazard insured against and which, if present and known to the insurer prior to the issuance of the policy, the insurer would not have issued the policy;</text> </level> <level label="iv"> <text>conviction:</text> <level label="1"> <text>within the preceding 5–year period, of arson; or</text> </level> <level label="2"> <text>within the preceding 3–year period, of a crime which directly increases the hazard insured against;</text> </level> </level> <level label="v"> <text>subject to subsection (i) of this section, the claims history of the insured where the insured makes more than three claims in the preceding 3–year period;</text> </level> <level label="vi"> <text>subject to subsection (o)(2) of this section, any other standard approved by the Commissioner that is based on factors that adversely affect the losses or expenses of the insurer under its approved rating plan and for which statistical validation is unavailable or is unduly burdensome to produce; and</text> </level> <level label="vii"> <text>subject to subsection (o)(2) of this section, any other standard set forth in regulations adopted by the Commissioner that is found to be reasonably related to the insurer’s economic and business purposes.</text> </level> </level> <level label="2"> <text>An insurer is not required to produce statistical validation that excludes weather–related claims or that makes any distinction between weather–related claims and nonweather–related claims in order to sustain the insurer’s burden of persuasion under subsection (g) of this section with respect to a cancellation or refusal to renew for a reason that is not listed in this subsection.</text> </level> </level> <level label="k"> <text>With respect to private passenger motor vehicle insurance, an insurer may not cancel or refuse to renew coverage based on the claims history of an insured where two or fewer of the claims within the preceding 3–year period were for accidents or losses where the insured was not at fault for the loss.</text> </level> <level label="l"> <level label="1"> <text>In the case of private passenger motor vehicle insurance, standards reasonably related to the insurer’s economic and business purposes under subsection (a)(2) of this section include, but are not limited to, the following and do not require statistical validation:</text> <level label="i"> <text>a material misrepresentation in connection with the application, policy, or presentation of a claim;</text> </level> <level label="ii"> <text>nonpayment of premium;</text> </level> <level label="iii"> <text>subject to § 27–609 of this title, revocation or suspension of the driver’s license or motor vehicle registration within the preceding 2–year period:</text> <level label="1"> <text>of the named insured or covered driver under the policy; and</text> </level> <level label="2"> <text>for reasons related to the driving record of the driver;</text> </level> </level> <level label="iv"> <text>subject to § 27–609 of this title, two or more motor vehicle accidents or any combination of three or more accidents and moving violations within the preceding 3–year period for which the insured was at fault for the accidents;</text> </level> <level label="v"> <text>subject to § 27–609 of this title, three or more moving violations against the insured or a covered driver under the policy within the preceding 2–year period;</text> </level> <level label="vi"> <text>subject to § 27–609 of this title, conviction of the named insured or a covered driver under the policy of any of the following:</text> <level label="1"> <text>a violation of § 21–902(a), (b), (c), or (d) of the Transportation Article;</text> </level> <level label="2"> <text>homicide, assault, reckless endangerment, or criminal negligence arising out of the operation of the motor vehicle; or</text> </level> <level label="3"> <text>using the motor vehicle to participate in a felony;</text> </level> </level> <level label="vii"> <text>subject to subsection (o)(1) of this section, any other standard approved by the Commissioner that is based on factors that adversely affect the losses or expenses of the insurer under its approved rating plan and for which statistical validation is unavailable or is unduly burdensome to produce; and</text> </level> <level label="viii"> <text>subject to subsection (o)(1) of this section, any other standard set forth in regulations adopted by the Commissioner that is found to be reasonably related to the insurer’s economic and business purposes.</text> </level> </level> <level label="2"> <text>An insurer is not required to produce statistical validation that excludes at fault accidents or that makes any distinction between not at fault accidents and at fault accidents in order to sustain the insurer’s burden of persuasion under subsection (g) of this section with respect to a cancellation or refusal to renew for a reason that is not listed in this subsection.</text> </level> </level> <level label="m"> <text>In the case of commercial insurance or insurance issued or provided by nonadmitted insurers, an insurer is not required to produce statistical validation of its underwriting standards in order to meet its burden of persuasion under this section.</text> </level> <level label="n"> <level label="1"> <text>Subject to the requirements of this article, if an insurer considers claims history for the purposes of canceling or refusing to renew coverage, the insurer may consider the following factors in mitigation of the proposed decision without producing statistical validation:</text> <level label="i"> <text>the severity of the losses;</text> </level> <level label="ii"> <text>the length of time that an insured has been a policyholder with the insurer;</text> </level> <level label="iii"> <text>loss mitigation of previous losses; and</text> </level> <level label="iv"> <text>the availability of a higher deductible for the particular policy and types of losses.</text> </level> </level> <level label="2"> <text>If an insurer considers claims history for purposes of canceling or refusing to renew coverage, the insurer shall disclose the practice to an insured at the inception of the policy and at each renewal.</text> </level> <level label="3"> <text>An insurer may comply with the disclosure required at renewal by paragraph (2) of this subsection by sending the notice authorized by § 19–216 of this article.</text> </level> </level> <level label="o"> <level label="1"> <text>With respect to private passenger motor vehicle insurance, an insurer may not deny, refuse to renew, or cancel coverage or increase rates for applicants or policyholders who are uniformed services personnel returning from active duty overseas solely because they fail to meet underwriting standards that require continuous coverage unless the failure to maintain continuous coverage existed prior to the applicant’s or policyholder’s assignment to active duty overseas.</text> </level> <level label="2"> <text>With respect to homeowner’s insurance, an insurer may not deny, refuse to renew, or cancel coverage or increase rates for applicants or policyholders who are uniformed services personnel returning from active duty overseas solely because they fail to meet:</text> <level label="i"> <text>underwriting standards that require continuous coverage unless the failure to maintain continuous coverage existed prior to the applicant’s or policyholder’s assignment to active duty overseas; or</text> </level> <level label="ii"> <text>occupancy requirements if the uniformed services personnel can demonstrate that reasonable steps were taken to maintain and protect the property during the applicant’s or policyholder’s assignment to active duty overseas.</text> </level> </level> </level> <level label="p"> <level label="1"> <text>In this subsection, “inquiry” means a telephone call or other communication to an insurer regarding the terms and conditions of a homeowner’s insurance policy, including a telephone call or other communication about whether the policy provides coverage for a particular loss or the process for filing a claim.</text> </level> <level label="2"> <text>With respect to homeowner’s insurance, an insurer may not refuse to underwrite a risk, increase a premium, or cancel or refuse to renew coverage based in whole or in part on an inquiry by an insured or an insurance producer on behalf of an insured that does not result in the payment of a claim.</text> </level> </level> <level label="q"> <text>For purposes of this section, with respect to private passenger motor vehicle insurance policies, homeowner’s insurance policies, commercial insurance policies, and workers’ compensation insurance policies, the transfer of a policyholder between admitted insurers within the same insurance holding company system, as defined in § 7–101 of this article, is a renewal if:</text> <level label="1"> <text>the policyholder’s premium does not increase; and</text> </level> <level label="2"> <text>the policyholder does not experience a reduction in coverage.</text> </level> </level> <level label="r"> <level label="1"> <text>This subsection applies to homeowner’s insurance, renter’s insurance, and private passenger motor vehicle insurance.</text> </level> <level label="2"> <text>With respect to homeowner’s insurance or renter’s insurance, an insurer may not deny, refuse to renew, or cancel coverage for an applicant or a policyholder solely because the applicant or policyholder does not carry private passenger motor vehicle insurance with the insurer or another insurer in the same insurance holding company system, as defined in § 7–101 of this article.</text> </level> <level label="3"> <text>With respect to private passenger motor vehicle insurance, an insurer may not deny, refuse to renew, or cancel coverage for an applicant or a policyholder solely because the applicant or policyholder does not carry homeowner’s insurance or renter’s insurance with the insurer or another insurer in the same insurance holding company system, as defined in § 7–101 of this article.</text> </level> <level label="4"> <text>This subsection does not prohibit:</text> <level label="i"> <text>an applicant or a policyholder from bundling homeowner’s insurance or renter’s insurance and private passenger motor vehicle insurance policies if the applicant or policyholder chooses to do so; or</text> </level> <level label="ii"> <text>an insurer from offering discounts or other incentives to applicants or policyholders who choose to bundle homeowner’s insurance or renter’s insurance and private passenger motor vehicle insurance policies.</text> </level> </level> </level> <level label="s"> <level label="1"> <text>This subsection applies only to life insurance, disability insurance, or long–term care insurance.</text> </level> <level label="2"> <text>An insurer may not, based solely on the status of an applicant or individual as an organ donor:</text> <level label="i"> <text>cancel, refuse to underwrite or renew, or refuse to issue an insurance policy;</text> </level> <level label="ii"> <text>refuse to pay a claim, cancel, or otherwise terminate an insurance policy;</text> </level> <level label="iii"> <text>increase premium rates for an insurance policy; or</text> </level> <level label="iv"> <text>add a surcharge, apply a rating factor, or use any other underwriting practice that adversely takes the information into account.</text> </level> </level> <level label="3"> <text>With respect to all other medical conditions, an applicant or individual who is an organ donor shall be subject to the same standards of sound actuarial principles or actual or reasonably anticipated experience as an applicant or individual who is not an organ donor.</text> </level> <level label="4"> <text>An insurer may not prohibit an applicant or individual from donating all or part of an organ as a condition of insurance.</text> </level> </level> <level label="t"> <text>With respect to private passenger motor vehicle insurance, an insurer may not require an applicant or a policyholder to participate in a program that measures the operation of an insured vehicle as a condition for underwriting a private passenger motor vehicle insurance risk unless the insurer:</text> <level label="1"> <text>only offers private passenger motor vehicle insurance products that require insureds to participate in a program that measures the operation of an insured vehicle;</text> </level> <level label="2"> <text>discloses the information in item (1) of this subsection to:</text> <level label="i"> <text>the applicant at the time of application; and</text> </level> <level label="ii"> <text>the policyholder at the time of renewal; and</text> </level> </level> <level label="3"> <text>includes the information in item (1) of this subsection in any advertising materials for the insurance products offered by the insurer.</text> </level> </level> <level label="u"> <text>If an applicant for residential condominium unit insurance experiences a lapse in coverage of the applicant’s prior residential condominium unit due to an insurer’s withdrawal from the market, an insurer from whom the applicant seeks new residential condominium unit coverage may not refuse to issue a policy based solely on the applicant’s lapse in coverage on the unit if:</text> <level label="1"> <text>the lapse in coverage was for not longer than 90 days;</text> </level> <level label="2"> <text>if required by the new insurer, the applicant provides an affidavit that the applicant has not incurred any losses during the lapse in coverage; and</text> </level> <level label="3"> <text>the applicant provides any other documentation required by the insurer.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-502" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="5" subtitle_name="Discrimination"> <level label="a"> <text>A surety insurer may not cancel or refuse to issue or renew a surety bond for a reason based wholly or partly on race, color, creed, sex, or physical handicap or disability of an applicant or principal or for any other arbitrary, capricious, or unfairly discriminatory reason.</text> </level> <level label="b"> <text>A surety insurer may not require special conditions, facts, or situations as a condition to its acceptance or renewal of a particular surety risk in an arbitrary, capricious, unfair, or discriminatory manner based wholly or partly on race, creed, color, sex, religion, national origin, place of residence, or physical handicap or disability.</text> </level> <level label="c"> <text>A surety insurer may not make an inquiry about race, creed, color, or national origin in a surety form, questionnaire, or other manner of requesting general information that relates to an application for a surety bond.</text> </level> <level label="d"> <text>On request, a surety insurer that intends to cancel or refuse to issue or renew a surety bond shall send to the bondholder or applicant written notice that states the reason for the proposed action.</text> </level> <level label="e"> <level label="1"> <text>A person aggrieved under this section shall notify the Commissioner in writing within 30 days after the occurrence giving rise to the complaint and shall state the facts giving rise to the complaint.</text> </level> <level label="2"> <text>On receipt of a complaint, the Commissioner shall forward a copy of the complaint to the surety insurer.</text> </level> <level label="3"> <text>If the Commissioner finds that the complaint is without merit, the Commissioner shall dismiss the complaint without a hearing and shall notify the surety insurer and complainant promptly in writing.</text> </level> <level label="4"> <text>If the complaint is not dismissed without a hearing, the Commissioner shall:</text> <level label="i"> <text>hold a hearing on the complaint within 30 days after receipt of the complaint; and</text> </level> <level label="ii"> <text>give written notice of the time and place of the hearing to all parties at least 10 days before the hearing.</text> </level> </level> <level label="5"> <text>At a hearing to determine whether this section has been violated, the burden of persuasion is on the surety insurer to show that the cancellation or refusal to underwrite or renew is not based wholly or partly on race, color, creed, sex, or physical handicap or disability of an applicant or principal or for any unfairly discriminatory reason.</text> </level> <level label="6"> <text>If, after the hearing, the Commissioner finds that the surety insurer has violated this section, the Commissioner may issue an appropriate order that:</text> <level label="i"> <text>states the manner in which the surety insurer has violated this section;</text> </level> <level label="ii"> <text>provides relief under subsection (g) or (h) of this section; and</text> </level> <level label="iii"> <text>states when, within a reasonable period but not less than 10 days after the hearing, the order shall be effective.</text> </level> </level> </level> <level label="f"> <level label="1"> <text>Any information or testimony provided by a surety insurer pursuant to a complaint under this section is privileged and confidential.</text> </level> <level label="2"> <text>There is no liability on the part of and no cause of action against a surety insurer, its representatives, or another person who in good faith provides to the surety insurer information or testimony that relates to the complaint.</text> </level> </level> <level label="g"> <text>If the Commissioner finds that a surety insurer has willfully violated this section, the Commissioner may impose a fine on the surety insurer in accordance with § 1-301 of this article.</text> </level> <level label="h"> <text>Instead of the fine provided in subsection (g) of this section, the Commissioner may order the surety insurer to write the bond if, at the hearing, the Commissioner finds by a preponderance of the evidence that the violation of subsection (a) or (b) of this section was knowing and willful and was the basis for the surety insurer’s action.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-503" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="5" subtitle_name="Discrimination"> <level label="a"> <text>An insurer may not cancel a written agreement with an insurance producer about insurance or refuse to accept insurance business from the insurance producer unless the insurer complies with this section.</text> </level> <level label="b"> <level label="1"> <text>This subsection does not apply to:</text> <level label="i"> <text>policies of life insurance, health insurance, surety insurance, wet marine and transportation insurance, and title insurance; or</text> </level> <level label="ii"> <text>insurance producers or policies of a company or group of companies represented by insurance producers who by contractual agreement represent only that company or group of companies if:</text> <level label="1"> <text>the business is owned by the company or group of companies; and</text> </level> <level label="2"> <text>the cancellation of any contractual agreement does not result in the cancellation or refusal to renew any policies.</text> </level> </level> </level> <level label="2"> <text>If an insurer intends to cancel a written agreement with an insurance producer or intends to refuse a class of renewal business from an insurance producer, the insurer shall give the insurance producer at least 90 days’ written notice.</text> </level> <level label="3"> <text>Notwithstanding any provision of the agreement to the contrary, the insurer shall continue for at least 2 years after termination of the agency agreement to renew through the insurance producer any of the policies that have not been replaced with other insurers as expirations occur.</text> </level> </level> <level label="c"> <text>An insurer may not cancel or refuse to renew a policy of the insured because of the termination of the insurance producer’s contract.</text> </level> <level label="d"> <text>Notwithstanding any other provision of this section, an insurer may not cancel or amend a written agreement with an insurance producer or refuse to accept business from the insurance producer if the cancellation, amendment, or refusal is arbitrary, capricious, unfair, or discriminatory or is based wholly or partly on the race, creed, color, sex, religion, national origin, or place of residency of the insurance producer or the applicants or policyholders of the insurance producer.</text> </level> <level label="e"> <text>If an insurer or insurance producer that accepts business from an insurance producer acting on behalf of an insured or prospective insured rejects the business of an insurance producer acting on behalf of an insured or prospective insured, the insurer or insurance producer shall give to the Commissioner and the insurance producer acting on behalf of an insured or prospective insured, on request of that insurance producer, the reasons for the rejection in writing.</text> </level> <level label="f"> <text>An insurer may not cancel or amend a written agreement with an insurance producer about property insurance or casualty insurance because of an adverse loss ratio experience on the insurance producer’s book of business if:</text> <level label="1"> <text>the insurer required the insurance producer to submit the application for underwriting approval, all material information on the application was completed, and the insurance producer did not omit or alter any information provided by the applicant; or</text> </level> <level label="2"> <text>the insurer accepted, without prior approval, policies issued by the insurance producer, if all material information on the application for the policy or on the insurer’s copy of any policy issued by the insurance producer was completed and the insurance producer did not omit or alter any information provided by the applicant.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-504" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="5" subtitle_name="Discrimination"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Abuse” has the meaning stated in § 4–501 of the Family Law Article.</text> </level> <level label="3"> <text>“Cohabitant” means an individual who has had a sexual relationship with another individual with whom the individual has resided for a period of at least 90 days.</text> </level> <level label="4"> <text>“Victim of domestic violence” means an individual who:</text> <level label="i"> <text>has received deliberate, severe, and demonstrable physical injury from a current or former spouse or current or former cohabitant; or</text> </level> <level label="ii"> <text>is in fear of imminent deliberate, severe, and demonstrable physical injury from a current or former spouse or current or former cohabitant.</text> </level> </level> </level> <level label="b"> <text>Except as otherwise provided in this article, if an individual is a victim of domestic violence or subject to abuse, an insurer, nonprofit health service plan, or health maintenance organization may not use information about abuse or the individual’s status as a victim of domestic violence to:</text> <level label="1"> <text>cancel, refuse to underwrite or renew, or refuse to issue a policy of life insurance or health insurance or a health benefits plan;</text> </level> <level label="2"> <text>refuse to pay a claim, cancel, or otherwise terminate a policy of life insurance or health insurance or a health benefits plan;</text> </level> <level label="3"> <text>increase rates for life insurance, health insurance, or a health benefits plan; or</text> </level> <level label="4"> <text>for policies of life insurance or health benefits plans, add a surcharge, apply a rating factor, or use any other underwriting practice that adversely takes the information into account.</text> </level> </level> <level label="c"> <text>If an insurer acts in good faith, the insurer is not subject to tort liability for a cause of action arising from the insurer’s lawful issuance of and lawful compliance with a policy of life insurance on an insured who subsequently suffers abuse or is a victim of domestic violence.</text> </level> <level label="d"> <text>This section does not require an insurer:</text> <level label="1"> <text>to make a payment to an individual who willfully caused an injury that gave rise to a loss under a policy of life insurance; or</text> </level> <level label="2"> <text>to issue, without the consent of the proposed insured, life insurance or disability income insurance to an applicant known to have abused the proposed insured.</text> </level> </level> <level label="e"> <text>This section may not be interpreted to preclude an insurer or a health maintenance organization from using mental or physical medical conditions, regardless of cause, in determining the eligibility, rate, or underwriting classification of the applicant, insured, member, or subscriber.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-504.1" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="5" subtitle_name="Discrimination"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Crime of violence” has the meaning stated in § 14–101 of the Criminal Law Article.</text> </level> <level label="3"> <text>“Victim” means a policyholder or claimant who suffers personal injury, death, or property loss as a result of a crime of violence.</text> </level> </level> <level label="b"> <text>Except as otherwise provided in this article, if an individual is a victim of a crime of violence, an insurer may not, based solely on information about the individual’s status as a victim of a crime of violence:</text> <level label="1"> <text>cancel, refuse to underwrite or renew, or refuse to issue a policy of homeowner’s insurance;</text> </level> <level label="2"> <text>refuse to pay a claim under a policy of homeowner’s insurance; or</text> </level> <level label="3"> <text>for a policy of homeowner’s insurance, increase a premium, add a surcharge, apply a rating factor, retier a policy, remove a discount, or take any other adverse underwriting or rating action.</text> </level> </level> <level label="c"> <level label="1"> <text>If a policy of homeowner’s insurance excludes property coverage for intentional acts, the insurer may not deny payment for a loss to a victim who:</text> <level label="i"> <text>is an innocent coinsured;</text> </level> <level label="ii"> <text>did not commit, cause to be committed, or direct the crime of violence leading to the loss; and</text> </level> <level label="iii"> <text>cooperates in any criminal investigation, including the filing of an official police report, and if undertaken, any prosecution of the perpetrator.</text> </level> </level> <level label="2"> <text>Payment to the innocent coinsured may be limited to the amount of the loss up to the homeowner’s insurance policy limits, less any applicable deductible and coinsurance and any payment to any secured party.</text> </level> <level label="3"> <text>An insurer may exclude property owned solely by the perpetrator from coverage under the policy of homeowner’s insurance.</text> </level> <level label="4"> <text>An insurer making payment to the innocent coinsured under this section shall have the right of subrogation against the perpetrator who committed, caused to be committed, or directed the crime of violence leading to the loss.</text> </level> </level> <level label="d"> <text>This section does not:</text> <level label="1"> <text>require payment in excess of a homeowner’s insurance policy limits;</text> </level> <level label="2"> <text>prohibit an insurer from applying reasonable standards of proof of a claim; or</text> </level> <level label="3"> <text>prohibit an insurer or insurance producer from:</text> <level label="i"> <text>asking an applicant, a policyholder, or a claimant about a claim under this section; or</text> </level> <level label="ii"> <text>using information obtained by investigation to evaluate a claim and exercise the insurer’s rights and perform its duties.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-505" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="5" subtitle_name="Discrimination"> <level label="a"> <level label="1"> <text>If the Commissioner finds that an insurer has violated § 27–501, § 27–503, § 27–504, or § 27–504.1 of this subtitle, the Commissioner, in addition to any other power granted by this article, may order the insurer to accept the risk, or accept the business, as appropriate.</text> </level> <level label="2"> <level label="i"> <text>With respect to medical professional liability insurance, the Commissioner shall issue a finding within 90 days after receiving a request to review the cancellation or refusal to renew a policy under § 27–501(f) of this subtitle.</text> </level> <level label="ii"> <text>A medical professional liability insurer may terminate the policy if:</text> <level label="1"> <text>the Commissioner fails to issue a finding within 90 days after receiving a request to review the cancellation or refusal to renew; or</text> </level> <level label="2"> <text>the Commissioner finds that the policy may be canceled or not renewed and issued the finding within 90 days after receiving a request to review the cancellation or refusal to renew.</text> </level> </level> <level label="iii"> <text>If a medical professional liability insurer terminates the policy under subparagraph (ii)1 of this paragraph and the Commissioner subsequently issues a finding that the insurer may not cancel or refuse to renew the policy:</text> <level label="1"> <text>the insurer immediately shall reinstate the policy; and</text> </level> <level label="2"> <text>the reinstatement shall be retroactive to the date that the policy was terminated.</text> </level> </level> </level> </level> <level label="b"> <text>A party to a hearing or proceeding under this subtitle may appeal from the hearing, proceeding, or a decision of the Commissioner in accordance with § 2-215 of this article.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-601" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <text>In this subtitle the following words have the meanings indicated.</text> </level> <level label="b"> <level label="1"> <text>“Commercial insurance” means property insurance or casualty insurance issued to an individual, a sole proprietor, partnership, corporation, limited liability company, or similar entity and intended to insure against loss arising from the business pursuits of the insured entity.</text> </level> <level label="2"> <text>“Commercial insurance” does not include:</text> <level label="i"> <text>policies issued by the Maryland Automobile Insurance Fund;</text> </level> <level label="ii"> <text>policies issued by the Joint Insurance Association;</text> </level> <level label="iii"> <text>workers’ compensation insurance; or</text> </level> <level label="iv"> <text>title insurance.</text> </level> </level> </level> <level label="c"> <level label="1"> <text>“Personal insurance” means property insurance or casualty insurance issued to an individual, trust, estate, or similar entity that is intended to insure against loss arising principally from the personal, noncommercial activities of the insured.</text> </level> <level label="2"> <text>“Personal insurance” does not include:</text> <level label="i"> <text>motor vehicle liability insurance policies subject to § 27-613 of this subtitle;</text> </level> <level label="ii"> <text>policies issued by the Maryland Automobile Insurance Fund;</text> </level> <level label="iii"> <text>policies issued by the Joint Insurance Association; or</text> </level> <level label="iv"> <text>surety insurance.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-601.1" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <text>For purposes of this subtitle, with respect to policies of personal insurance, private passenger motor vehicle liability insurance, commercial insurance, and workers’ compensation insurance, the issuance by an insurer of a new policy to replace an expiring policy issued by that insurer is a renewal.</text> </level> <level label="b"> <text>For purposes of this subtitle, with respect to policies of personal insurance, private passenger motor vehicle liability insurance, commercial insurance, and workers’ compensation insurance, the issuance by an insurer of a new policy to replace an expiring policy issued by another admitted insurer within the same insurance holding company system, as defined in § 7–101 of this article, is a renewal if:</text> <level label="1"> <text>the policyholder’s premium does not increase; and</text> </level> <level label="2"> <text>the policyholder does not experience a reduction in coverage.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-601.2" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Delivered by electronic means” includes:</text> <level label="i"> <text>delivery to an electronic mail address at which a party has consented to receive notice; and</text> </level> <level label="ii"> <text>posting on an electronic network, together with separate notice to a party directed to the electronic mail address at which the party has consented to receive notice of the posting.</text> </level> </level> <level label="3"> <text>“Party” means an applicant, an insured, or a policyholder.</text> </level> </level> <level label="b"> <text>Subject to subsection (d) of this section, any notice to a party required under this subtitle may be delivered by electronic means provided the process used to obtain consent of the party to have notice delivered by electronic means meets the requirements of Title 21, Subtitle 1 of the Commercial Law Article.</text> </level> <level label="c"> <text>Delivery of a notice in accordance with subsection (b) of this section shall be considered equivalent to any delivery method required under this subtitle, including delivery by first–class mail, certified mail, or a first–class mail tracking method.</text> </level> <level label="d"> <text>A notice may be delivered by electronic means by an insurer to a party under this section if:</text> <level label="1"> <text>the party has affirmatively consented to that method of delivery and has not withdrawn the consent;</text> </level> <level label="2"> <text>the party, before giving consent, is provided with a clear and conspicuous statement:</text> <level label="i"> <text>informing the party of:</text> <level label="1"> <text>any right or option of the party to have the notice provided or made available in paper or another nonelectronic form;</text> </level> <level label="2"> <text>the right of the party to withdraw consent to have notice delivered by electronic means and any fees, conditions, or consequences imposed in the event consent is withdrawn;</text> </level> <level label="3"> <text>whether the party’s consent applies:</text> </level> <level label="A"> <text>only to the particular transaction as to which the notice must be given; or</text> </level> <level label="B"> <text>to identified categories of notices that may be delivered by electronic means during the course of the parties’ relationship;</text> </level> <level label="4"> <level label="A"> <text>how, after consent is given, the party may obtain a paper copy of a notice delivered by electronic means; and</text> </level> </level> <level label="B"> <text>the fee, if any, for the paper copy; and</text> </level> <level label="5"> <text>the procedures the party must use to withdraw consent to have notice delivered by electronic means and to update information needed to contact the party electronically;</text> </level> </level> </level> <level label="3"> <text>the party:</text> <level label="i"> <text>before giving consent, is provided with a statement of the hardware and software requirements for access to and retention of a notice delivered by electronic means; and</text> </level> <level label="ii"> <text>consents electronically, or confirms consent electronically, in a manner that reasonably demonstrates that the party can access information in the electronic form that will be used for notices delivered by electronic means as to which the party has given consent; and</text> </level> </level> <level label="4"> <text>after consent of the party is given, the insurer, in the event a change in the hardware or software requirements needed to access or retain a notice delivered by electronic means creates a material risk that the party will not be able to access or retain a subsequent notice to which the consent applies:</text> <level label="i"> <text>provides the party with a statement of:</text> <level label="1"> <text>the revised hardware and software requirements for access to and retention of a notice delivered by electronic means; and</text> </level> <level label="2"> <text>the right of the party to withdraw consent without the imposition of any fee, condition, or consequence that was not disclosed under item (2)(i)2 of this subsection; and</text> </level> </level> <level label="ii"> <text>complies with item (2) of this subsection.</text> </level> </level> </level> <level label="e"> <text>This section does not affect the content or timing of any notice required under this subtitle.</text> </level> <level label="f"> <text>If a provision of this subtitle requiring notice to be provided to a party expressly requires verification or acknowledgment of receipt of the notice, the notice may be delivered by electronic means only if the method used provides for verification or acknowledgment of receipt.</text> </level> <level label="g"> <text>The legal effectiveness, validity, or enforceability of any contract or policy of insurance executed by a party may not be denied solely because of the failure to obtain electronic consent or confirmation of consent of the party in accordance with subsection (d)(3)(ii) of this section.</text> </level> <level label="h"> <level label="1"> <text>A withdrawal of consent by a party does not affect the legal effectiveness, validity, or enforceability of a notice delivered by electronic means to the party before the withdrawal of consent is effective.</text> </level> <level label="2"> <text>A withdrawal of consent by a party is effective within a reasonable period of time after receipt of the withdrawal by the insurer.</text> </level> <level label="3"> <text>Failure to comply with subsection (d)(4) of this section may be treated, at the election of the party, as a withdrawal of consent for purposes of this section.</text> </level> </level> <level label="i"> <text>This section does not apply to a notice delivered by an insurer in an electronic form before October 1, 2011, to a party who, before October 1, 2011, has consented to receive notice in an electronic form otherwise allowed by law.</text> </level> <level label="j"> <text>If the consent of a party to receive notice in an electronic form is on file with an insurer before October 1, 2011, the insurer shall notify the party of:</text> <level label="1"> <text>the notices that may be delivered by electronic means under this section; and</text> </level> <level label="2"> <text>the party’s right to withdraw consent to have notices delivered by electronic means.</text> </level> </level> <level label="k"> <level label="1"> <text>Except as otherwise provided by law, if an oral communication or a recording of an oral communication can be reliably stored and reproduced by an insurer, the oral communication or recording may qualify as a notice delivered by electronic means for purposes of this section.</text> </level> <level label="2"> <text>If a provision of this subtitle requires a signature or record to be notarized, acknowledged, verified, or made under oath, the requirement is satisfied if the electronic signature of the person authorized to perform those acts, together with all other information required to be included by the provision, is attached to or logically associated with the signature or record.</text> </level> </level> <level label="l"> <text>This section may not be construed to modify, limit, or supersede the provisions of the federal Electronic Signatures in Global and National Commerce Act relating to the use of an electronic record to provide or make available information that is required to be provided or made available in writing to a party.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-602" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>This section applies only to policies of:</text> <level label="i"> <text>personal insurance; and</text> </level> <level label="ii"> <text>homeowner’s insurance under which a onetime guaranteed fully refundable deposit is required for a stated amount of coverage.</text> </level> </level> <level label="2"> <text>This section does not apply to policies in effect for 45 days or less, as provided in § 12–106 of this article.</text> </level> </level> <level label="b"> <level label="1"> <text>Whenever an insurer, as required by subsection (c) of this section, gives notice of its intention to cancel or not to renew a policy subject to this section issued in the State or before an insurer cancels a policy subject to this section issued in the State for a reason other than nonpayment of premium, the insurer shall notify the insured of the possible right of the insured to replace the insurance under the Maryland Property Insurance Availability Act or through another plan for which the insured may be eligible.</text> </level> <level label="2"> <text>The notice required by paragraph (1) of this subsection must:</text> <level label="i"> <text>be in writing;</text> </level> <level label="ii"> <text>contain the current address and telephone number of the offices of the appropriate plan; and</text> </level> <level label="iii"> <text>be sent to the named insured at the named insured’s last known address in the same manner and at the same time as the first written notice of cancellation or of intention not to renew given or required by law, regulation, or contract.</text> </level> </level> </level> <level label="c"> <level label="1"> <text>Subject to paragraph (5) of this subsection, at least 45 days before the date of the proposed cancellation or expiration of the policy, the insurer shall send to the named insured at the named insured’s last known address, by a first–class mail tracking method, a written notice of intention to cancel for a reason other than nonpayment of premium or notice of intention not to renew a policy issued in the State.</text> </level> <level label="2"> <text>An insurer shall maintain proof of mailing in a form authorized or accepted by the United States Postal Service.</text> </level> <level label="3"> <text>Notice given to the insured by an insurance producer on behalf of the insurer is deemed to have been given by the insurer for purposes of this subsection.</text> </level> <level label="4"> <text>Notwithstanding paragraph (3) of this subsection, no notice is required under this section if the insured has replaced the insurance.</text> </level> <level label="5"> <text>An insurer may not cancel a policy midterm except:</text> <level label="i"> <text>when there exists:</text> <level label="1"> <text>a material misrepresentation or fraud in connection with the application, policy, or presentation of a claim;</text> </level> <level label="2"> <text>a matter or issue related to the risk that constitutes a threat to public safety; or</text> </level> <level label="3"> <text>a change in the condition of the risk that results in an increase in the hazard insured against;</text> </level> </level> <level label="ii"> <text>for nonpayment of premium; or</text> </level> <level label="iii"> <text>in the case of homeowner’s insurance, conviction of arson.</text> </level> </level> </level> <level label="d"> <text>At least 10 days before the date an insurer proposes to cancel a policy for nonpayment of premium, the insurer shall send to the named insured, at the named insured’s last known address, by a first–class mail tracking method, a written notice of intention to cancel for nonpayment of premium.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-603" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>This section applies only to policies of commercial insurance.</text> </level> <level label="2"> <text>This section does not apply to:</text> <level label="i"> <text>policies in effect for 45 days or less, as provided in § 12–106 of this article; or</text> </level> <level label="ii"> <text>policies issued to exempt commercial policyholders under § 11–206 of this article, if the policies provide for written notice of not less than 30 days of the insurer’s intent to cancel or nonrenew.</text> </level> </level> </level> <level label="b"> <level label="1"> <text>Whenever an insurer, as required by subsection (c) of this section, gives notice of its intention to cancel or not to renew a policy issued in this State for a reason other than nonpayment of premium, the insurer shall notify the insured of the possible right to replace the insurance under the Maryland Property Insurance Availability Act, through the Maryland Automobile Insurance Fund, or through another plan for which the insured may be eligible.</text> </level> <level label="2"> <text>The notice required by paragraph (1) of this subsection shall:</text> <level label="i"> <text>be in writing;</text> </level> <level label="ii"> <text>if applicable, include the current address and telephone number of the offices of the Joint Insurance Association, the Maryland Automobile Insurance Fund, or other appropriate plan; and</text> </level> <level label="iii"> <text>be sent to the insured in the same manner and at the same time as the first written notice of cancellation or of intention not to renew that is given or required by law, regulation, or contract.</text> </level> </level> </level> <level label="c"> <level label="1"> <text>Subject to paragraph (5) of this subsection, at least 45 days before the date of the proposed cancellation or expiration of the policy, the insurer shall send to the insured, by a first–class mail tracking method or by commercial mail delivery service, written notice of intention to cancel for a reason other than nonpayment of premium or notice of intention not to renew a policy issued in the State.</text> </level> <level label="2"> <text>The insurer shall maintain proof of mailing in a form authorized or accepted by the United States Postal Service or other commercial mail delivery service.</text> </level> <level label="3"> <text>Notice given to the insured by an insurance producer on behalf of the insurer is deemed to have been given by the insurer for the purposes of this subsection.</text> </level> <level label="4"> <text>No notice is required under this subsection if the insured has replaced the insurance.</text> </level> <level label="5"> <text>An insurer may not cancel a policy midterm except:</text> <level label="i"> <text>when there exists:</text> <level label="1"> <text>a material misrepresentation or fraud in connection with the application, policy, or presentation of a claim;</text> </level> <level label="2"> <text>a matter or issue related to the risk that constitutes a threat to public safety; or</text> </level> <level label="3"> <text>a change in the condition of the risk that results in an increase in the hazard insured against;</text> </level> </level> <level label="ii"> <text>for nonpayment of premium; or</text> </level> <level label="iii"> <text>due to the revocation or suspension of the driver’s license or motor vehicle registration:</text> <level label="1"> <text>of the named insured or covered driver under the policy; and</text> </level> <level label="2"> <text>for reasons related to the driving record of the named insured or covered driver.</text> </level> </level> </level> </level> <level label="d"> <text>At least 10 days before the date an insurer proposes to cancel a policy for nonpayment of premium, the insurer shall send to the insured, by a first–class mail tracking method, a written notice of intention to cancel for nonpayment of premium.</text> </level> <level label="e"> <level label="1"> <text>If an insurer provides a renewal policy and notice of premium due to an insured at least 45 days before the renewal date of the policy and the insured fails to make the required payment by the renewal date, the insurer may terminate the policy on the renewal date for nonpayment of premium after sending to the insured, by a first–class mail tracking method, a written offer to reinstate the renewal policy without lapse in coverage.</text> </level> <level label="2"> <text>An offer to reinstate under this subsection shall provide not less than 10 days for the insured to make the required premium payment.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-604" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>This section applies only to policies of personal insurance and insurance issued under the Maryland Property Insurance Availability Act or any similar act instituted to ensure the availability of insurance.</text> </level> <level label="2"> <text>This section does not apply to policies in effect for 45 days or less, as provided in § 12-106 of this article.</text> </level> </level> <level label="b"> <level label="1"> <text>Whenever an insurer cancels or refuses to renew a policy subject to this section, the insurer must provide to the named insured a statement of the actual reason for the cancellation or refusal to renew.</text> </level> <level label="2"> <text>The Commissioner may not disallow a proposed action of an insurer because the statement of actual reason contains:</text> <level label="i"> <text>grammatical, typographical, or other errors, if the errors are not material to the proposed action and are not misleading;</text> </level> <level label="ii"> <text>surplus information, if the surplus information is not misleading; or</text> </level> <level label="iii"> <text>erroneous information, if in the absence of the erroneous information there is a sufficient basis to support the proposed action.</text> </level> </level> </level> <level label="c"> <text>A statement of actual reason is privileged and does not constitute grounds for an action against the insurer, its representatives, or another person that in good faith provides to the insurer information on which the statement is based.</text> </level> <level label="d"> <level label="1"> <text>The reason given in the statement of actual reason shall be clear and specific.</text> </level> <level label="2"> <text>The use of generalized terms such as “personal habits”, “physical handicap or disability”, “living conditions”, “poor morals”, or “violation or accident record” does not meet the requirement of this subsection.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-605" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>This section applies only to policies of commercial insurance.</text> </level> <level label="2"> <text>This section does not apply to:</text> <level label="i"> <text>policies in effect for 45 days or less, as provided in § 12–106 of this article; or</text> </level> <level label="ii"> <text>policies issued to exempt commercial policyholders under § 11–206 of this article, if the policies provide for written notice of not less than 30 days of the insurer’s intent to cancel or nonrenew.</text> </level> </level> </level> <level label="b"> <level label="1"> <text>Whenever an insurer cancels or refuses to renew a policy subject to this section for a reason other than nonpayment of premium, the insurer must provide to the named insured a written statement of the actual reason for the cancellation or refusal to renew.</text> </level> <level label="2"> <text>The reason given in the statement of actual reason shall be clear and specific.</text> </level> <level label="3"> <text>The statement shall include the insurer’s offer to provide additional information in support of the proposed action upon the written request of the insured and an address for the insured to submit the request.</text> </level> <level label="4"> <text>A written request for information under this subsection shall be sent not more than 30 days from the date of the notice containing the actual reason.</text> </level> <level label="5"> <text>On receiving a written request from an insured for additional information under this subsection and prior to the effective date of the proposed action, an insurer shall respond in writing within 15 days.</text> </level> <level label="6"> <text>Except as provided in § 27–501 of this title, a request for additional information under this section does not stay the proposed action.</text> </level> </level> <level label="c"> <text>The Commissioner may not disallow a proposed action of an insurer because the statement of actual reason contains:</text> <level label="1"> <text>grammatical, typographical, or other errors, if the errors are not material to the proposed action and are not misleading;</text> </level> <level label="2"> <text>surplus information, if the surplus information is not misleading; or</text> </level> <level label="3"> <text>erroneous information, if in the absence of the erroneous information there is a sufficient basis to support the proposed action.</text> </level> </level> <level label="d"> <text>Information concerning the actual reason is privileged and does not constitute grounds for an action against the insurer, the insurer’s representatives, an insurance producer, or any other person that in good faith provides information on which the statement is based.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-606" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>Except for life insurance, health insurance, and annuities, an insurer that intends to cancel or not renew a line of business shall file a plan of withdrawal with the Commissioner at least 180 days before the date of the proposed withdrawal.</text> </level> <level label="2"> <text>Notwithstanding paragraph (1) of this subsection, the Commissioner may allow an insurer to file a plan of withdrawal at least 60 days before the date of proposed withdrawal if the Commissioner determines that compliance by the insurer with paragraph (1) of this subsection may result in:</text> <level label="i"> <text>the impairment of the insurer;</text> </level> <level label="ii"> <text>the loss of or substantial changes in applicable reinsurance; or</text> </level> <level label="iii"> <text>significant financial losses to the insurer.</text> </level> </level> <level label="3"> <text>For health insurance:</text> <level label="i"> <text>an insurer that intends to cancel or not renew a health insurance product, as defined by the Commissioner, for all of its covered insureds in the State shall file a plan of withdrawal with the Commissioner at least 90 days before the date of the proposed cancellation or nonrenewal; and</text> </level> <level label="ii"> <text>an insurer that intends to withdraw completely from the health insurance market in the State by canceling or not renewing all of its health insurance products in the State shall file a plan of withdrawal with the Commissioner at least 180 days before the date of the proposed withdrawal.</text> </level> </level> </level> <level label="b"> <text>The plan of withdrawal shall contain:</text> <level label="1"> <text>a statement by an elected officer of the insurer that the cancellation or nonrenewal action is necessary as a result of:</text> <level label="i"> <text>the loss of or substantial changes in applicable reinsurance;</text> </level> <level label="ii"> <text>financial losses of the insurer; or</text> </level> <level label="iii"> <text>another business or economic reason of the insurer;</text> </level> </level> <level label="2"> <text>if the reason for cancellation or nonrenewal is loss of or substantial changes in reinsurance, a statement that explains:</text> <level label="i"> <text>that the insurer made a good faith effort to obtain replacement reinsurance, but was unable to do so due to either the unavailability or unaffordability of replacement reinsurance;</text> </level> <level label="ii"> <text>how the loss of or reduction in reinsurance affects the insurer’s risks throughout the entire line or category of insurance proposed for cancellation or nonrenewal; and</text> </level> <level label="iii"> <text>why cancellation or nonrenewal is necessary to cure the loss of or reduction in available reinsurance; and</text> </level> </level> <level label="3"> <text>notwithstanding the reason for cancellation or nonrenewal, a statement that:</text> <level label="i"> <text>identifies the category of risk, the total number of risks written by the insurer in that line of business, and the number of risks intended to be canceled or not renewed;</text> </level> <level label="ii"> <text>explains how the cancellation or nonrenewals, if approved, will be implemented with respect to individual risks and the steps that will be taken to ensure that the cancellation or nonrenewal decisions will not be applied in an arbitrary, capricious, or unfairly discriminatory manner or in violation of § 27–501 of this title; and</text> </level> <level label="iii"> <text>includes any other information that the Commissioner reasonably requires.</text> </level> </level> </level> <level label="c"> <text>If a plan of withdrawal filed with the Commissioner is not accompanied by the information required by this section, the Commissioner may so inform the insurer and the plan of withdrawal will be deemed filed when the information is provided to the Commissioner.</text> </level> <level label="d"> <text>After an insurer has filed a plan of withdrawal with the Commissioner, the insurer shall notify in writing each of its insurance producers in the State that the insurer has filed a plan of withdrawal.</text> </level> <level label="e"> <text>The Commissioner shall review each plan of withdrawal to determine its compliance with this section and § 27–501 of this title.</text> </level> <level label="f"> <level label="1"> <level label="i"> <text>The Commissioner shall disapprove each plan of withdrawal that does not comply with this section.</text> </level> <level label="ii"> <text>If the Commissioner disapproves a plan, the Commissioner shall issue an order of disapproval that includes specific reasons for the disapproval.</text> </level> </level> <level label="2"> <level label="i"> <text>Subject to paragraph (3) of this subsection, a plan filed under this section is deemed approved if the Commissioner fails to approve or disapprove the plan within 60 days after the date of filing by the insurer.</text> </level> <level label="ii"> <text>If a filing is deemed approved under this paragraph, the filing becomes effective on the 60th day after the date of filing.</text> </level> </level> <level label="3"> <text>If the Commissioner does not have sufficient information to determine whether a filing or amended filing meets the requirements of this section, the Commissioner:</text> <level label="i"> <text>shall require the insurer to provide the necessary information; and</text> </level> <level label="ii"> <text>may extend the period for approval until the information is provided.</text> </level> </level> <level label="4"> <text>A plan may be withdrawn or amended by the insurer at any time before approval.</text> </level> <level label="5"> <text>After approval or disapproval of a plan, the withdrawal or amendment of the plan is subject to the approval of the Commissioner.</text> </level> </level> <level label="g"> <text>The Commissioner may disapprove a plan of withdrawal for health insurance if an insurer, nonprofit health service plan, or health maintenance organization has failed to demonstrate compliance with § 15–1212 or § 15–1308 of this article.</text> </level> <level label="h"> <text>The provisions of subsections (a)(3) and (b) through (f) of this section that apply to insurers also apply to health maintenance organizations.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-607" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <text>This section applies only to policies of personal insurance and insurance issued under the Maryland Property Insurance Availability Act or any similar act instituted to ensure the availability of property insurance.</text> </level> <level label="b"> <text>At least 45 days prior to the renewal date of a policy subject to this section, the insurer shall send a notice to the named insured and the insurance producer, if any, by first-class mail stating both the amount of the renewal policy premium and the amount of the expiring policy premium.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-608" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>This section applies to:</text> <level label="i"> <text>policies of commercial insurance; and</text> </level> <level label="ii"> <text>policies of workers’ compensation insurance.</text> </level> </level> <level label="2"> <text>This section does not apply to policies:</text> <level label="i"> <text>issued to exempt commercial policyholders, as defined in § 11–206(j) of this article; or</text> </level> <level label="ii"> <text>for which the renewal policy premium is an increase over the expiring policy premium of 15% or less.</text> </level> </level> </level> <level label="b"> <text>Unless an insurer has given notice of its intention not to renew a policy subject to this section, if the insurer seeks to increase the renewal policy premium, the insurer shall send a notice to the named insured and insurance producer, if any, not less than 45 days prior to the renewal date of the policy.</text> </level> <level label="c"> <text>Subject to subsection (d) of this section, a notice under this section shall include:</text> <level label="1"> <text>both the expiring policy premium and the renewal policy premium; and</text> </level> <level label="2"> <text>the telephone number for the insurer or insurance producer, if any, together with a statement that the insured may call to request additional information about the premium increase.</text> </level> </level> <level label="d"> <level label="1"> <text>If an insurer seeks to increase the renewal policy premium and the insurer’s rating methodology requires the insured to provide information to calculate the renewal policy premium, an insurer shall provide a reasonable estimate of the renewal policy premium if:</text> <level label="i"> <text>the insurer has requested the required information from the insured; and</text> </level> <level label="ii"> <text>the insurer has not received the requested information.</text> </level> </level> <level label="2"> <text>A reasonable estimate under this subsection shall be based upon the information available to the insurer at the time the notice is sent.</text> </level> </level> <level label="e"> <text>The requirements of this section do not apply to the extent that the premium increase results from:</text> <level label="1"> <text>an increase in the units of exposure;</text> </level> <level label="2"> <text>the application of an experience rating plan;</text> </level> <level label="3"> <text>the application of a retrospective rating plan;</text> </level> <level label="4"> <text>a change made by the insured that increases the insurer’s exposure; or</text> </level> <level label="5"> <text>an audit of the insured.</text> </level> </level> <level label="f"> <text>A notice required by this section shall be sent by first–class mail and may be sent together with the renewal policy.</text> </level> <level label="g"> <text>An insurer may not be required to comply with any notice requirement of this section if, not less than 45 days before the effective date of the renewal policy, the insurer has sent:</text> <level label="1"> <level label="i"> <text>to the named insured, a renewal policy that includes the renewal policy premium; and</text> </level> <level label="ii"> <text>to the independent insurance producer, if any:</text> <level label="1"> <text>a copy of the renewal policy that includes the renewal policy premium through postal or electronic mail; or</text> </level> <level label="2"> <text>at the same time as the insurer sends the renewal policy to the insured, a notice of the availability of the renewal policy through the insurer’s online electronic system;</text> </level> </level> </level> <level label="2"> <text>to the named insured and insurance producer, if any, a written notice of renewal or continuation of coverage that includes the renewal or continuation premium; or</text> </level> <level label="3"> <text>to the named insured and insurance producer, if any, a renewal offer that includes a reasonable estimate of the renewal policy premium.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-608.1" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <text>This section applies to policies of commercial insurance and policies of workers’ compensation insurance.</text> </level> <level label="b"> <level label="1"> <text>If a policyholder is being transferred between admitted insurers within the same insurance holding company system, as defined in § 7–101 of this article, the insurer providing the new policy shall provide notice of the transfer to the policyholder.</text> </level> <level label="2"> <text>An insurer shall be considered to have met the notice requirement of this section if the insurer has sent to the named insured a renewal policy that includes a notice of transfer, or a notice on the declaration page of the renewal policy, notifying the insured that the policy has been transferred from the prior named insurer to the new or renewing named insurer.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-609" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <text>This section does not apply to a premium increase for a driver or vehicle due to a program that measures the operation of an insured vehicle during the current policy period.</text> </level> <level label="b"> <level label="1"> <level label="i"> <text>This paragraph applies to a private passenger motor vehicle liability insurance policy issued in the State under which more than one individual is insured.</text> </level> <level label="ii"> <text>If an insurer is authorized under this article to cancel, nonrenew, or increase the premiums on a policy of private passenger motor vehicle liability insurance subject to this paragraph because of the claim experience or driving record of one or more but less than all of the individuals insured under the policy, the insurer, instead of cancellation, nonrenewal, or premium increase, shall offer to continue or renew the insurance, but to exclude all coverage when a motor vehicle is operated by the specifically named excluded individual or individuals whose claim experience or driving record could have justified the cancellation, nonrenewal, or premium increase.</text> </level> </level> <level label="2"> <level label="i"> <text>This paragraph applies to a motor vehicle liability insurance policy issued in the State, other than a policy subject to paragraph (1) of this subsection, under which more than one individual is insured.</text> </level> <level label="ii"> <text>If an insurer is authorized under this article to cancel, nonrenew, or increase the premiums on a policy of motor vehicle liability insurance subject to this paragraph because of the claim experience or driving record of one or more but less than all of the individuals insured under the policy, the insurer, instead of cancellation, nonrenewal, or premium increase, may offer to continue or renew the insurance, but to exclude all coverage when a motor vehicle is operated by the specifically named excluded individual or individuals whose claim experience or driving record could have justified the cancellation, nonrenewal, or premium increase.</text> </level> </level> </level> <level label="c"> <text>If an insurer legally could refuse to issue a policy of motor vehicle liability insurance under which more than one individual is insured because of the claim experience or driving record of one or more but less than all of the individuals applying to be insured under the policy, the insurer may issue the policy but exclude all coverage when a motor vehicle is operated by the specifically named excluded individual or individuals whose claim experience or driving record could have justified the refusal to issue.</text> </level> <level label="d"> <text>A policy described in subsection (b) or (c) of this section may be endorsed to exclude specifically all coverage for any of the following when the named excluded driver is operating a motor vehicle covered under the policy whether or not that operation or use was with the express or implied permission of an individual insured under the policy:</text> <level label="1"> <text>the excluded operator or user;</text> </level> <level label="2"> <text>the motor vehicle owner;</text> </level> <level label="3"> <text>family members residing in the household of the excluded operator or user or motor vehicle owner; and</text> </level> <level label="4"> <text>any other person, except for the coverage required by §§ 19–505 and 19–509 of this article if that coverage is not available under another motor vehicle policy.</text> </level> </level> <level label="e"> <text>The premiums charged on a policy that excludes a named driver or drivers under this section may not reflect the claim experience or driving record of the excluded named driver or drivers.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-610" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>This section applies only to policies of personal insurance and private passenger motor vehicle liability insurance policies subject to § 27–613 of this subtitle.</text> </level> <level label="2"> <text>Unless an insurer has provided notice of its intention not to renew a policy in compliance with this subtitle, the insurer must provide each policyholder with notice of renewal premium due at least 45 days before the due date.</text> </level> <level label="3"> <text>If a policyholder is being transferred between admitted insurers within the same insurance holding company system, as defined in § 7–101 of this article, the notice required under paragraph (2) of this subsection shall include disclosure of the transfer.</text> </level> <level label="4"> <text>A licensed insurance producer may provide notice under paragraph (2) of this subsection on behalf of the insurer.</text> </level> <level label="5"> <text>The duty to provide notice under paragraph (2) of this subsection is deemed discharged if:</text> <level label="i"> <text>the insurer shows that its established procedures would have resulted in placing the notice of renewal premium due in the United States mail; and</text> </level> <level label="ii"> <text>there is no showing that in fact the notice was not placed in the mail.</text> </level> </level> </level> <level label="b"> <text>If an insurer fails to provide notice of renewal premium due under subsection (a) of this section, and subsequently the policyholder fails to make timely payment of the renewal premium, the insurer must:</text> <level label="1"> <text>provide coverage for each claim that:</text> <level label="i"> <text>would have been covered under the policy; and</text> </level> <level label="ii"> <text>arises within 45 days after the date the insured discovers or should have discovered that the policy was not renewed; and</text> </level> </level> <level label="2"> <text>renew the policy on tender of payment within 30 days after the policyholder discovers or should have discovered that the policy was not renewed.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-611" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <text>Before the actual expiration of a policy of motor vehicle insurance that results from nonpayment of a renewal premium, the insurer shall provide notice to the insured in clear and specific terms that if the insured fails to renew or replace the motor vehicle insurance before the due date, § 17-106 of the Transportation Article provides that uninsured motorist penalties be assessed and that evidences of registration be surrendered to the Motor Vehicle Administration and that failure to surrender the evidences of registration may result in suspension of current and future registration privileges.</text> </section> <section article="gin" article_name="Insurance" number="27-612" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>If an insurer fails to comply with any provision of § 27-602, § 27-603, § 27-604, § 27-605, § 27-606, § 27-607, § 27-608, § 27-610, or § 27-613 of this subtitle, the insurer is liable to the applicant for the coverage that was requested, or that would have become effective except for the failure to comply with these provisions, unless the person seeking coverage:</text> <level label="i"> <text>no longer wishes the coverage;</text> </level> <level label="ii"> <text>has obtained other substantially equivalent coverage; or</text> </level> <level label="iii"> <text>fails to tender or pay the premium after reasonable demand for the premium has been made.</text> </level> </level> <level label="2"> <text>The liability of an insurer under paragraph (1) of this subsection is in addition to any other penalties applicable by law.</text> </level> </level> <level label="b"> <text>Liability for coverage does not apply to failure to comply with § 27-611 of this subtitle, as it relates to motor vehicle liability insurance.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-613" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <level label="1"> <text>This section applies only to private passenger motor vehicle liability insurance.</text> </level> <level label="2"> <text>This section does not apply to the Maryland Automobile Insurance Fund.</text> </level> <level label="3"> <text>This section does not apply to the cancellation of a policy or binder of private passenger motor vehicle liability insurance by an insurer during the 45–day underwriting period in accordance with § 12–106 of this article.</text> </level> </level> <level label="b"> <level label="1"> <text>In accordance with this section, with respect to a policy of private passenger motor vehicle liability insurance or a binder of private passenger motor vehicle liability insurance, if the binder has been in effect for at least 45 days, issued in the State to any resident of the household of the named insured, an insurer may:</text> <level label="i"> <text>cancel or fail to renew the policy or binder; or</text> </level> <level label="ii"> <text>reduce coverage under the policy.</text> </level> </level> <level label="2"> <text>Notwithstanding paragraph (1) of this subsection, the requirements of this section do not apply if:</text> <level label="i"> <text>the reduction in coverage described in paragraph (1)(ii) of this subsection is part of a general reduction in coverage approved by the Commissioner or satisfies the requirements of Title 19, Subtitle 5 of this article; or</text> </level> <level label="ii"> <text>the failure to renew the policy takes place under a plan of withdrawal that:</text> <level label="1"> <text>is approved by the Commissioner under § 27–606 of this subtitle; and</text> </level> <level label="2"> <text>provides that each insured affected by the plan of withdrawal shall be sent by a first–class mail tracking method at least 45 days before the nonrenewal of the policy a written notice that states the date that the policy will be nonrenewed and that the nonrenewal is the result of the withdrawal of the insurer from the market.</text> </level> </level> </level> <level label="3"> <text>Notwithstanding paragraph (1) of this subsection, an insurer may not cancel a policy midterm except:</text> <level label="i"> <text>when there exists:</text> <level label="1"> <text>a material misrepresentation or fraud in connection with the application, policy, or presentation of a claim;</text> </level> <level label="2"> <text>a matter or issue related to the risk that constitutes a threat to public safety; or</text> </level> <level label="3"> <text>a change in the condition of the risk that results in an increase in the hazard insured against;</text> </level> </level> <level label="ii"> <text>for nonpayment of premium; or</text> </level> <level label="iii"> <text>due to the revocation or suspension of the driver’s license or motor vehicle registration:</text> <level label="1"> <text>of the named insured or covered driver under the policy; and</text> </level> <level label="2"> <text>for reasons related to the driving record of the named insured or covered driver.</text> </level> </level> </level> </level> <level label="c"> <level label="1"> <text>At least 45 days before the proposed effective date of the action, an insurer that intends to take an action subject to this section shall send written notice of its proposed action to the insured at the last known address of the insured:</text> <level label="i"> <text>for notice of cancellation or nonrenewal, by certified mail; and</text> </level> <level label="ii"> <text>for all other notices of actions subject to this section, by a first–class mail tracking method.</text> </level> </level> <level label="2"> <text>The notice must be on a form approved by the Commissioner.</text> </level> <level label="3"> <text>The notice must state in clear and specific terms:</text> <level label="i"> <text>the proposed action to be taken, including for a reduction in coverage, the type of coverage reduced and the extent of the reduction;</text> </level> <level label="ii"> <text>the proposed effective date of the action;</text> </level> <level label="iii"> <text>subject to paragraph (4) of this subsection, the actual reason of the insurer for proposing to take the action;</text> </level> <level label="iv"> <text>if there is coupled with the notice an offer to continue or renew the policy in accordance with § 27–609 of this subtitle:</text> <level label="1"> <text>the name of the individual or individuals to be excluded from coverage; and</text> </level> <level label="2"> <text>the premium amount if the policy is continued or renewed with the named individual or individuals excluded from coverage;</text> </level> </level> <level label="v"> <text>the right of the insured to replace the insurance through the Maryland Automobile Insurance Fund and the current address and telephone number of the Fund;</text> </level> <level label="vi"> <text>the right of the insured to protest the proposed action of the insurer and request a hearing before the Commissioner on the proposed action by:</text> <level label="1"> <text>signing a copy of the notice and sending it to the Commissioner within 30 days after the mailing date of the notice; or</text> </level> <level label="2"> <text>filing the protest electronically through the consumer complaint portal on the Administration’s website within 30 days after the mailing date on the notice;</text> </level> </level> <level label="vii"> <text>that if a protest is filed by the insured, the insurer must maintain the current insurance in effect until a final determination is made by the Commissioner, subject to the payment of any authorized premium due or becoming due before the determination; and</text> </level> <level label="viii"> <text>that the Commissioner shall order the insurer to pay reasonable attorney’s fees incurred by the insured for representation at the hearing if the Commissioner finds that:</text> <level label="1"> <text>the actual reason for the proposed action is not stated in the notice or the proposed action is not in accordance with § 27–501 of this title, the insurer’s filed rating plan, its underwriting standards, or the lawful terms and conditions of the policy related to a cancellation, nonrenewal, or reduction in coverage; and</text> </level> <level label="2"> <text>the insurer’s conduct in maintaining or defending the proceeding was in bad faith or the insurer acted willfully in the absence of a bona fide dispute.</text> </level> </level> </level> <level label="4"> <level label="i"> <text>The insurer’s statement of actual reason for proposing to take an action subject to this section must be clear and specific and include a brief statement of the basis for the action, including, at a minimum:</text> <level label="1"> <text>if the action of the insurer is due wholly or partly to an accident:</text> </level> <level label="A"> <text>the name of the driver;</text> </level> <level label="B"> <text>the date of the accident; and</text> </level> <level label="C"> <text>if fault is a material factor for the insurer’s action, a statement that the driver was at fault;</text> </level> <level label="2"> <text>if the action of the insurer is due wholly or partly to a violation of the Maryland Vehicle Law or the vehicle laws of another state or territory of the United States:</text> </level> <level label="A"> <text>the name of the driver;</text> </level> <level label="B"> <text>the date of the violation; and</text> </level> <level label="C"> <text>a description of the violation;</text> </level> <level label="3"> <text>if the action of the insurer is due wholly or partly to the claims history of an insured, a description of each claim;</text> </level> <level label="4"> <text>whether the insurer’s action is based on a violation of law, policy terms or conditions, or the insurer’s underwriting standards;</text> </level> <level label="5"> <text>whether the insurer’s action is based on a material misrepresentation; and</text> </level> <level label="6"> <text>any other information that is the basis for the insurer’s action.</text> </level> </level> <level label="ii"> <text>The use of generalized terms such as “personal habits”, “living conditions”, “poor morals”, or “violation or accident record” does not meet the requirements of this paragraph.</text> </level> <level label="iii"> <text>The Commissioner may not disallow a proposed action of an insurer because the statement of actual reason contains:</text> <level label="1"> <text>grammatical errors, typographical errors, or other errors provided that the errors are nonmaterial and not misleading;</text> </level> <level label="2"> <text>surplus information, provided that the surplus information is nonmaterial and not misleading; or</text> </level> <level label="3"> <text>erroneous information, provided that in absence of the erroneous information, there remains a sufficient basis to support the action.</text> </level> </level> </level> </level> <level label="d"> <text>At least 10 days before the date an insurer proposes to cancel a policy for nonpayment of premium, the insurer shall send to the insured, by a first–class mail tracking method, a written notice of intention to cancel for nonpayment of premium.</text> </level> <level label="e"> <text>A statement of actual reason contained in the notice given under subsection (c) of this section is privileged and does not constitute grounds for an action against the insurer, its representatives, or another person that in good faith provides to the insurer information on which the statement is based.</text> </level> <level label="f"> <level label="1"> <text>This subsection does not apply to an action of an insurer taken under subsection (d) of this section.</text> </level> <level label="2"> <text>An insured may protest a proposed action of the insurer under this section by:</text> <level label="i"> <text>signing a copy of the notice and sending it to the Commissioner within 30 days after the mailing date of the notice; or</text> </level> <level label="ii"> <text>filing the protest electronically through the consumer complaint portal on the Administration’s website within 30 days after the mailing date on the notice.</text> </level> </level> <level label="3"> <text>On receipt of a protest, the Commissioner shall notify the insurer of the filing of the protest.</text> </level> <level label="4"> <text>A protest filed with the Commissioner stays the proposed action of the insurer pending a final determination by the Commissioner.</text> </level> <level label="5"> <text>The insurer shall maintain in effect the same coverage and premium that were in effect on the day the notice of proposed action was sent to the insured until a final determination is made, subject to the payment of any authorized premium due or becoming due before the determination.</text> </level> </level> <level label="g"> <level label="1"> <text>Based on the information contained in the notice, the Commissioner shall:</text> <level label="i"> <text>determine whether the protest by the insured has merit; and</text> </level> <level label="ii"> <text>dismiss the protest or disallow the proposed action of the insurer.</text> </level> </level> <level label="2"> <text>The Commissioner shall notify the insurer and the insured of the action of the Commissioner promptly in writing.</text> </level> <level label="3"> <text>Subject to paragraph (4) of this subsection, within 30 days after the mailing date of the Commissioner’s notice of action, the aggrieved party may request a hearing.</text> </level> <level label="4"> <text>The Commissioner shall:</text> <level label="i"> <text>Hold a hearing within a reasonable time after the request for a hearing; and</text> </level> <level label="ii"> <text>give written notice of the time and place of the hearing at least 10 days before the hearing.</text> </level> </level> <level label="5"> <text>A hearing held under this subsection shall be conducted in accordance with Title 10, Subtitle 2 of the State Government Article.</text> </level> <level label="6"> <text>At the hearing the insurer has the burden of proving its proposed action to be in accordance with the insurer’s filed rating plan, its underwriting standards, or the lawful terms and conditions of the policy related to a cancellation, nonrenewal, or reduction in coverage, as applicable, and not in violation of § 27–501 of this title and, in doing so, may rely only on the reasons set forth in its notice to the insured.</text> </level> </level> <level label="h"> <level label="1"> <text>The Commissioner shall issue an order within 30 days after the conclusion of the hearing.</text> </level> <level label="2"> <text>If the Commissioner finds the proposed action of the insurer to be in accordance with the insurer’s filed rating plan, its underwriting standards, or the lawful terms and conditions of the policy related to a cancellation, nonrenewal, or reduction in coverage, as applicable, and not in violation of § 27–501 of this title, the Commissioner shall:</text> <level label="i"> <text>dismiss the protest; and</text> </level> <level label="ii"> <text>allow the proposed action to be taken on the later of:</text> <level label="1"> <text>its proposed effective date; and</text> </level> <level label="2"> <text>30 days after the date of the determination.</text> </level> </level> </level> <level label="3"> <text>If the Commissioner finds that the actual reason for the proposed action is not stated in the notice or the proposed action is not in accordance with § 27–501 of this title, the insurer’s filed rating plan, its underwriting standards, or the lawful terms and conditions of the policy related to a cancellation, nonrenewal, or reduction in coverage, the Commissioner shall:</text> <level label="i"> <text>disallow the action; and</text> </level> <level label="ii"> <text>order the insurer to pay reasonable attorney’s fees incurred by the insured for representation at the hearing if the Commissioner finds that the insurer’s conduct in maintaining or defending the proceeding was in bad faith or the insurer acted willfully in the absence of a bona fide dispute.</text> </level> </level> </level> <level label="i"> <text>The Commissioner may delegate the powers and duties of the Commissioner under this section to one or more employees or hearing examiners.</text> </level> <level label="j"> <text>A party to a proceeding under this section may appeal the decision of the Commissioner in accordance with § 2–215 of this article.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-614" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="6" subtitle_name="Cancellations, Nonrenewals, Premium Increases, and Reductions in Coverage"> <level label="a"> <text>In this section, “increase in premium” and “premium increase” include an increase in total premium for a policy due to:</text> <level label="1"> <text>a surcharge;</text> </level> <level label="2"> <text>retiering or other reclassification of an insured; or</text> </level> <level label="3"> <text>removal or reduction of a discount.</text> </level> </level> <level label="b"> <level label="1"> <text>This section applies only to private passenger motor vehicle liability insurance.</text> </level> <level label="2"> <text>This section does not apply to the Maryland Automobile Insurance Fund.</text> </level> <level label="3"> <text>This section does not apply to an increase in premium made by an insurer during the 45–day underwriting period in accordance with § 12–106(d)(2) and (3) of this article.</text> </level> </level> <level label="c"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection, at least 45 days before the effective date of an increase in the total premium for a policy of private passenger motor vehicle liability insurance, the insurer shall send written notice of the premium increase to the insured at the last known address of the insured by a first–class mail tracking method.</text> </level> <level label="2"> <text>The notice required by paragraph (1) of this subsection need not be given if the premium increase is part of a general increase in premiums that is filed in accordance with Title 11 of this article and does not result from a reclassification of the insured.</text> </level> <level label="3"> <text>The notice may accompany or be included in the renewal offer or policy.</text> </level> <level label="4"> <text>The notice must be on a form approved by the Commissioner.</text> </level> <level label="5"> <text>The notice must state in clear and specific terms:</text> <level label="i"> <text>the premium for the current policy period;</text> </level> <level label="ii"> <text>the premium for the renewal policy period;</text> </level> <level label="iii"> <text>the basis for the action, including, at a minimum:</text> <level label="1"> <text>if the premium increase is due wholly or partly to an accident:</text> </level> <level label="A"> <text>the name of the driver;</text> </level> <level label="B"> <text>the date of the accident; and</text> </level> <level label="C"> <text>if fault is a material factor for the insurer’s action, a statement that the driver was at fault;</text> </level> <level label="2"> <text>if the premium increase is due wholly or partly to a violation of the Maryland Vehicle Law or the vehicle laws of another state or territory of the United States:</text> </level> <level label="A"> <text>the name of the driver;</text> </level> <level label="B"> <text>the date of the violation; and</text> </level> <level label="C"> <text>a description of the violation;</text> </level> <level label="3"> <text>if the premium increase is due wholly or partly to the claims history of an insured, a description of each claim;</text> </level> <level label="4"> <text>if the premium increase is due to a program that measures the operation of an insured vehicle during the current policy period:</text> </level> <level label="A"> <text>a specific description of the factor or factors in the program resulting in the premium increase; and</text> </level> <level label="B"> <text>the amount of the premium increase that is attributable to the program; and</text> </level> <level label="5"> <text>any other information that is the basis for the insurer’s action;</text> </level> </level> <level label="iv"> <text>that the insured should contact the insured’s insurance producer or insurer for a review of the premium if the insured has a question about the increase in premium or believes the information in the notice is incorrect;</text> </level> <level label="v"> <text>the right of the insured to protest the premium increase and, in the case of a premium increase of more than 15% for the entire policy, to request a hearing before the Commissioner by mailing, transmitting by facsimile to the Commissioner, or filing electronically through the consumer complaint portal on the Administration’s website a protest that includes:</text> <level label="1"> <text>a copy of the notice;</text> </level> <level label="2"> <text>the insured’s address and daytime telephone number; and</text> </level> <level label="3"> <text>a statement of the reason that the insured believes the premium increase is incorrect;</text> </level> </level> <level label="vi"> <text>the address and facsimile number of the Administration; and</text> </level> <level label="vii"> <text>that the Commissioner shall order the insurer to pay reasonable attorney’s fees incurred by the insured for representation at a hearing if the Commissioner finds that:</text> <level label="1"> <text>the actual reason for the proposed action is not stated in the notice or the proposed action is not in accordance with this article or the insurer’s filed rating plan; and</text> </level> <level label="2"> <text>the insurer’s conduct in maintaining or defending the proceeding was in bad faith or the insurer acted willfully in the absence of a bona fide dispute.</text> </level> </level> </level> </level> <level label="d"> <level label="1"> <text>If the insured believes that the premium increase is incorrect, the insured may protest the proposed action of the insurer within 30 days after the mailing date of the notice by mailing, transmitting by facsimile to the Commissioner, or filing electronically through the consumer complaint portal on the Administration’s website a protest that includes:</text> <level label="i"> <text>a copy of the notice;</text> </level> <level label="ii"> <text>the insured’s address and daytime telephone number; and</text> </level> <level label="iii"> <text>a statement of the reason that the insured believes the premium increase is incorrect.</text> </level> </level> <level label="2"> <text>On receipt of a protest, the Commissioner shall notify the insurer of the filing of the protest.</text> </level> <level label="3"> <level label="i"> <text>Except as provided in subparagraph (ii) of this paragraph, a protest filed with the Commissioner does not stay the proposed action of the insurer.</text> </level> <level label="ii"> <text>If a premium increase for a policy exceeds 15%, the Commissioner may order a stay of the premium increase pending a final decision if the Commissioner makes a finding that the premium increase:</text> <level label="1"> <text>may cause the policyholder undue harm; and</text> </level> <level label="2"> <text>is in violation of the insurer’s filed rating plan.</text> </level> </level> </level> <level label="4"> <text>Based on the information contained in the notice, the Commissioner shall:</text> <level label="i"> <text>determine whether the insurer’s action is in accordance with the insurer’s filed rating plan and this article; and</text> </level> <level label="ii"> <text>dismiss the protest or disallow the proposed action of the insurer.</text> </level> </level> <level label="5"> <text>The Commissioner shall notify the insurer and the insured of the action of the Commissioner promptly in writing.</text> </level> <level label="6"> <text>For a premium increase of more than 15% for the entire policy, within 30 days after the mailing date of the Commissioner’s notice of action, the aggrieved party may request a hearing.</text> </level> <level label="7"> <text>The Commissioner shall:</text> <level label="i"> <text>hold a hearing within a reasonable time after the request for a hearing; and</text> </level> <level label="ii"> <text>give written notice of the time and place of the hearing at least 10 days before the hearing.</text> </level> </level> <level label="8"> <text>A hearing requested under this subsection shall be conducted in accordance with Title 10, Subtitle 2 of the State Government Article.</text> </level> <level label="9"> <text>At the hearing the insurer has the burden of proving its proposed action to be in accordance with its filed rating plan and this article and, in doing so, may rely only on the reasons set forth in its notice to the insured.</text> </level> </level> <level label="e"> <level label="1"> <text>The Commissioner shall issue an order within 30 days after the conclusion of the hearing.</text> </level> <level label="2"> <text>If the Commissioner finds the proposed action of the insurer to be in accordance with the insurer’s filed rating plan and this article, the Commissioner shall:</text> <level label="i"> <text>dismiss the protest; and</text> </level> <level label="ii"> <text>if the insurer’s action is stayed, allow the proposed action of the insurer to be taken on the later of:</text> <level label="1"> <text>its proposed effective date; and</text> </level> <level label="2"> <text>30 days after the date of the determination.</text> </level> </level> </level> <level label="3"> <text>If the Commissioner finds that the actual reason for the proposed action is not stated in the notice or the proposed action is not in accordance with the insurer’s filed rating plan or this article, the Commissioner shall:</text> <level label="i"> <text>disallow the action; and</text> </level> <level label="ii"> <text>order the insurer to pay reasonable attorney’s fees incurred by the insured for representation at the hearing if the Commissioner finds that the insurer’s conduct in maintaining or defending the proceeding was in bad faith or the insurer acted willfully in the absence of a bona fide dispute.</text> </level> </level> <level label="4"> <text>The Commissioner may not dismiss a protest solely because of the insured’s failure to state a reason that the insured believes the premium increase is incorrect.</text> </level> </level> <level label="f"> <level label="1"> <text>If the Commissioner disallows a premium increase for the entire policy, the insurer, within 30 days after the disallowance, shall:</text> <level label="i"> <text>return to the insured all disallowed premium received from the insured; and</text> </level> <level label="ii"> <text>pay to the insured interest on the disallowed premium received from the insured calculated at 10% a year from the date the disallowed premium was received to the date the disallowed premium was returned.</text> </level> </level> <level label="2"> <text>If an insurer fails to return any disallowed premium and interest to the insured as provided in paragraph (1) of this subsection within 30 days after the Commissioner disallows the action of the insurer, the insurer shall pay interest on the disallowed premium calculated at 20% a year beginning on the 31st day following the disallowance to the date the disallowed premium is returned.</text> </level> <level label="3"> <text>If an insurer fails to return any disallowed premium or fails to pay interest to an insured in violation of paragraphs (1) and (2) of this subsection, the insurer is subject to the penalties under § 4–113(d) of this article.</text> </level> </level> <level label="g"> <text>A party to a proceeding under this section may appeal the decision of the Commissioner in accordance with § 2–215 of this article.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-701" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="7" subtitle_name="Unauthorized Insurers False Advertising Process Act"> <text>In this subtitle, “resident” includes a domestic, alien, or foreign person, partnership, or corporation.</text> </section> <section article="gin" article_name="Insurance" number="27-702" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="7" subtitle_name="Unauthorized Insurers False Advertising Process Act"> <level label="a"> <level label="1"> <text>The General Assembly declares that it is in the interest of citizens of the State who buy insurance from unauthorized insurers that solicit business in the State by placing in or sending into the State false advertising designed to induce residents of the State to buy insurance from them, that those unauthorized insurers be subject to this subtitle.</text> </level> <level label="2"> <text>The purpose of this subtitle is to subject to the jurisdiction of the Commissioner and the courts of the State those unauthorized insurers described in paragraph (1) of this subsection.</text> </level> <level label="3"> <text>In furtherance of this State interest, the General Assembly provides a method of substituted service of process on those unauthorized insurers described in paragraph (1) of this subsection.</text> </level> <level label="4"> <text>The General Assembly declares that by enacting this subtitle, the General Assembly is exercising:</text> <level label="i"> <text>its power to protect the residents of the State; and</text> </level> <level label="ii"> <text>its powers and privileges under the McCarran-Ferguson Act, 15 U.S.C. §§ 1011 through 1015.</text> </level> </level> </level> <level label="b"> <text>The authority provided in this subtitle is in addition to any other powers of the State.</text> </level> <level label="c"> <text>This subtitle shall be construed liberally.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-703" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="7" subtitle_name="Unauthorized Insurers False Advertising Process Act"> <text>An unauthorized foreign insurer or unauthorized alien insurer may not make, issue, circulate, or cause to be made, issued, or circulated to residents of the State an estimate, illustration, circular, pamphlet, or letter, or cause to be made in a newspaper, magazine, or other publication or over a radio or television station an announcement or statement to residents that misrepresents the insurer’s financial condition, the terms of or benefits or advantages promised by insurance contracts issued or to be issued, or the dividends or share of the surplus to be received on the insurance contracts in violation of this title.</text> </section> <section article="gin" article_name="Insurance" number="27-704" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="7" subtitle_name="Unauthorized Insurers False Advertising Process Act"> <level label="a"> <level label="1"> <text>If the Commissioner has reason to believe that an unauthorized foreign insurer or unauthorized alien insurer is engaging in unlawful advertising in violation of § 27–703 of this subtitle, the Commissioner shall give notice of the violation by certified mail, or by electronic means in accordance with § 2–116 of this article, to the insurer and the insurance supervisory official of the domiciliary state of the insurer.</text> </level> <level label="2"> <text>For purposes of this section, the domiciliary state of an alien insurer is deemed to be the state of entry or the state of the principal office of the alien insurer in the United States.</text> </level> </level> <level label="b"> <text>If, after 30 days after the Commissioner gives notice under subsection (a) of this section, the insurer continues to violate § 27-703 of this subtitle, the Commissioner shall take action against the insurer under this title if the Commissioner believes that:</text> <level label="1"> <text>a proceeding by the Commissioner with respect to a violation of § 27-703 of this subtitle would be in the public interest; and</text> </level> <level label="2"> <text>the insurer is:</text> <level label="i"> <text>issuing or delivering insurance contracts to residents of the State;</text> </level> <level label="ii"> <text>collecting premiums on the insurance contracts; or</text> </level> <level label="iii"> <text>doing any of the acts listed in § 27-705 of this subtitle.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-705" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="7" subtitle_name="Unauthorized Insurers False Advertising Process Act"> <level label="a"> <text>An unauthorized foreign insurer or unauthorized alien insurer is deemed to have appointed the Commissioner to be the attorney of the unauthorized insurer for purposes of service of statements of charges, notices, and process in a proceeding instituted under this title for a misrepresentation set forth in § 27-703 of this subtitle or in a proceeding for the recovery of a penalty under this title and to have agreed that service on the Commissioner has the same legal effect as personal service in the State on the unauthorized insurer if the unauthorized insurer in the State, by mail or otherwise:</text> <level label="1"> <text>issues or delivers insurance contracts to residents of the State;</text> </level> <level label="2"> <text>solicits applications for insurance contracts;</text> </level> <level label="3"> <text>collects premiums, membership fees, assessments, or other consideration for insurance contracts; or</text> </level> <level label="4"> <text>transacts any other insurance business.</text> </level> </level> <level label="b"> <level label="1"> <text>Service of statements of charges and notices under this title shall be made by a deputy or employee of the Administration by delivering to and leaving with the Commissioner or an individual in apparent charge of the office of the Commissioner two copies of the statement of charges or notice.</text> </level> <level label="2"> <text>Service of process issued by a court in a proceeding to collect a penalty under this title shall be made by delivering to and leaving with the Commissioner or an individual in apparent charge of the office of the Commissioner two copies of the process.</text> </level> <level label="3"> <text>Immediately after receipt of a statement of charges, notice, or process, the Commissioner shall cause one copy of the statement of charges, notice, or process to be sent by certified mail to the unauthorized insurer at its last known principal place of business.</text> </level> <level label="4"> <text>Service of statements of charges, notices, or process under this subsection is sufficient if:</text> <level label="i"> <text>the statement of charges, notice, or process is mailed as provided in paragraph (3) of this subsection; and</text> </level> <level label="ii"> <text>on or before the date that the unauthorized insurer is required to appear or within any further time that may be allowed, the following items are filed with the Commissioner, in the case of a statement of charges or notice, or with the clerk of the court in which the action is pending, in the case of process:</text> <level label="1"> <text>the unauthorized insurer’s receipt, or the receipt issued by the United States Postal Service, showing the name of the sender of the letter and the name and address of the addressee; and</text> </level> <level label="2"> <text>an affidavit of the individual who did the mailing showing compliance with paragraph (1) of this subsection.</text> </level> </level> </level> <level label="5"> <text>The Commissioner shall keep a record of all statements of charges, notices, and process served on the Commissioner under this subsection.</text> </level> </level> <level label="c"> <text>As an alternative to service under subsection (b) of this section, service of statements of charges, notices, or process is valid if:</text> <level label="1"> <text>service is made on any person in the State that, on behalf of the unauthorized insurer:</text> <level label="i"> <text>solicits insurance in the State;</text> </level> <level label="ii"> <text>makes, issues, or delivers an insurance contract in the State; or</text> </level> <level label="iii"> <text>collects or receives in the State a premium for insurance;</text> </level> </level> <level label="2"> <text>within 10 days after service under item (1) of this subsection, a copy of the statement of charges, notice, or process is sent by certified mail by or on behalf of the Commissioner to the unauthorized insurer at its last known principal place of business; and</text> </level> <level label="3"> <text>on or before the date that the unauthorized insurer is required to appear or within any further time that the court allows, the following items are filed with the Commissioner, in the case of a statement of charges or notice, or with the clerk of the court in which the action is pending, in the case of process:</text> <level label="i"> <text>the unauthorized insurer’s receipt, or the receipt issued by the United States Postal Service, showing the name of the sender of the letter and the name and address of the addressee; and</text> </level> <level label="ii"> <text>an affidavit of the individual who did the mailing showing compliance with item (1) of this subsection.</text> </level> </level> </level> <level label="d"> <text>A cease or desist order, judgment by default, or judgment by confession under this section may not be entered until the expiration of 30 days after the date of the filing of the affidavit of compliance.</text> </level> <level label="e"> <level label="1"> <text>Service of process and notice under this article is in addition to all other methods of service provided by law.</text> </level> <level label="2"> <text>This article does not limit or prohibit the right to serve any statement of charges, notice, or process on an insurer in any other manner authorized by law.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-706" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="7" subtitle_name="Unauthorized Insurers False Advertising Process Act"> <text>This subtitle is the Unauthorized Insurers False Advertising Process Act.</text> </section> <section article="gin" article_name="Insurance" number="27-801" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="8" subtitle_name="Reporting and Preventing Insurance Fraud"> <level label="a"> <text>In this subtitle the following words have the meanings indicated.</text> </level> <level label="b"> <text>“Fraud Division” means the Insurance Fraud Division in the Administration.</text> </level> <level label="c"> <text>“Insurance fraud” means:</text> <level label="1"> <text>a violation of Subtitle 4 of this title;</text> </level> <level label="2"> <text>theft, as set out in §§ 7–101 through 7–104 of the Criminal Law Article:</text> <level label="i"> <text>from a person regulated under this article; or</text> </level> <level label="ii"> <text>by a person regulated under this article or an officer, director, agent, or employee of a person regulated under this article;</text> </level> </level> <level label="3"> <text>a violation of § 9–1106 of the Labor and Employment Article; or</text> </level> <level label="4"> <text>any other fraudulent activity that is committed by or against a person regulated under this article and is a violation of:</text> <level label="i"> <text>Title 1, Subtitle 3 of the Agriculture Article;</text> </level> <level label="ii"> <text>Title 19, Subtitle 2 or Subtitle 3 of the Business Regulation Article;</text> </level> <level label="iii"> <text>Title 14, Subtitle 29, § 11–810 or § 14–1317 of the Commercial Law Article;</text> </level> <level label="iv"> <text>the Criminal Law Article other than Title 8, Subtitle 2, Part II or § 10–614;</text> </level> <level label="v"> <text>Title 12, Subtitle 9 of the Financial Institutions Article;</text> </level> <level label="vi"> <text>§ 14–127 of the Real Property Article;</text> </level> <level label="vii"> <text>§ 6–301 of the Alcoholic Beverages and Cannabis Article;</text> </level> <level label="viii"> <text>§ 109 of the Code of Public Local Laws of Caroline County;</text> </level> <level label="ix"> <text>§ 4–103 of the Code of Public Local Laws of Carroll County; or</text> </level> <level label="x"> <text>§ 8A–1 of the Code of Public Local Laws of Talbot County.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-802" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="8" subtitle_name="Reporting and Preventing Insurance Fraud"> <level label="a"> <level label="1"> <text>An authorized insurer, its employees, fund producers, insurance producers, a viatical settlement provider, or a viatical settlement broker who in good faith has cause to believe that insurance fraud has been or is being committed shall report the suspected insurance fraud in writing to the Commissioner, the Fraud Division, or the appropriate federal, State, or local law enforcement authorities.</text> </level> <level label="2"> <text>An independent insurance producer shall meet the reporting requirement of this subsection by reporting the suspected insurance fraud in writing to the Fraud Division.</text> </level> <level label="3"> <text>A registered premium finance company shall meet the requirement of this subsection by reporting suspected insurance fraud in writing to the Fraud Division.</text> </level> <level label="4"> <text>A governmental self–insurance group formed in accordance with § 9–404 of the Labor and Employment Article or an employer who self–insures or participates in a self–insurance group in accordance with § 9–405 of the Labor and Employment Article shall meet the reporting requirement of this subsection by reporting suspected insurance fraud in writing to the Fraud Division.</text> </level> </level> <level label="b"> <text>In addition to any protection provided under Title 4, Subtitle 4, Part IV of the General Provisions Article, any information, documentation, or other evidence provided under this section by an insurer, its employees, fund producers, or insurance producers, a viatical settlement provider, a viatical settlement broker, an independent insurance producer, a registered premium finance company, a governmental self–insurance group, or an employer who self–insures or participates in a self–insurance group to the Commissioner, the Fraud Division, or a federal, State, or local law enforcement authority in connection with an investigation of suspected insurance fraud is not subject to public inspection for as long as the Commissioner, Fraud Division, or law enforcement authority considers the withholding to be necessary to complete an investigation of the suspected fraud or to protect the person investigated from unwarranted injury.</text> </level> <level label="c"> <text>A person is not subject to civil liability for a cause of action by virtue of reporting suspected insurance fraud, or furnishing or receiving information relating to suspected, anticipated, or completed fraudulent insurance acts, if:</text> <level label="1"> <text>the report was made, or the information was furnished to or received from:</text> <level label="i"> <text>the Commissioner, Fraud Division, or an appropriate federal, State, or local law enforcement authority;</text> </level> <level label="ii"> <text>the National Association of Insurance Commissioners or its agent, employee, or designee;</text> </level> <level label="iii"> <text>a nonprofit organization established to detect and prevent fraudulent insurance acts or its agent, employee, or designee;</text> </level> <level label="iv"> <text>a person that contracts to provide special investigative unit services to an insurer; or</text> </level> <level label="v"> <text>a provider of a recognized comprehensive database system that the Commissioner approves to monitor activities involving insurance fraud or an employee of the provider; and</text> </level> </level> <level label="2"> <text>the person that reported the suspected insurance fraud, or furnished or received the information, acted in good faith when making the report or furnishing or receiving the information.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-803" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="8" subtitle_name="Reporting and Preventing Insurance Fraud"> <level label="a"> <level label="1"> <text>Each authorized insurer that has in force policies or certificates of insurance in the State shall institute and maintain an insurance antifraud plan.</text> </level> <level label="2"> <text>Within 30 days after instituting or modifying an antifraud plan, the authorized insurer shall notify the Commissioner in writing.</text> </level> </level> <level label="b"> <text>Each antifraud plan shall establish specific procedures to:</text> <level label="1"> <text>prevent insurance fraud, including:</text> <level label="i"> <text>internal fraud that involves the authorized insurer’s employees or insurance producers;</text> </level> <level label="ii"> <text>fraud that results from misrepresentations on insurance applications; and</text> </level> <level label="iii"> <text>claims fraud;</text> </level> </level> <level label="2"> <text>report insurance fraud to appropriate law enforcement authorities;</text> </level> <level label="3"> <text>cooperate with the prosecution of insurance fraud cases; and</text> </level> <level label="4"> <text>report fraud–related data to the Commissioner and Fraud Division.</text> </level> </level> <level label="c"> <level label="1"> <text>Each authorized insurer that has in force policies or certificates of insurance in the State shall file its antifraud plan with the Commissioner.</text> </level> <level label="2"> <text>The Commissioner may review each antifraud plan to determine whether it complies with the requirements of this section.</text> </level> <level label="3"> <text>An antifraud plan is deemed approved unless disapproved by the Commissioner within 30 days after the date of filing.</text> </level> </level> <level label="d"> <level label="1"> <text>If the Commissioner finds that an antifraud plan does not comply with the requirements of this section, the Commissioner shall disapprove the antifraud plan and send a notice of disapproval, including the reasons for disapproval, to the authorized insurer.</text> </level> <level label="2"> <text>If the Commissioner disapproves an antifraud plan, the authorized insurer shall submit a new antifraud plan to the Commissioner within 60 days after the date of disapproval.</text> </level> </level> <level label="e"> <text>During an examination under § 2–205 of this article, the Commissioner shall examine the authorized insurer’s procedures to determine whether the authorized insurer is complying with its antifraud plan.</text> </level> <level label="f"> <text>The Commissioner may withhold from public inspection any part of an antifraud plan for as long as the Commissioner considers the withholding to be in the public interest.</text> </level> <level label="g"> <level label="1"> <text>As part of an antifraud plan, an authorized insurer may require in writing that an individual who is receiving benefits under a disability insurance policy must affirm on a periodic basis that the individual:</text> <level label="i"> <text>remains entitled to the benefits; and</text> </level> <level label="ii"> <text>has had no change in the condition entitling the individual to the benefits.</text> </level> </level> <level label="2"> <text>An authorized insurer that requires the affirmation permitted under paragraph (1) of this subsection shall disclose to the individual who is receiving benefits that if the individual knowingly and willfully provides false information or knowingly and willfully fails to provide material information in connection with the individual’s eligibility or continued eligibility for benefits under a disability insurance policy, the individual is guilty of a crime and may be subject to a fine and imprisonment.</text> </level> </level> <level label="h"> <text>The Commissioner shall adopt regulations that establish minimum standards for antifraud plans required to be filed under this section.</text> </level> <level label="i"> <text>It is a violation of this subtitle if the Commissioner finds that an authorized insurer that has in force policies or certificates of insurance in the State has failed to:</text> <level label="1"> <text>file an antifraud plan;</text> </level> <level label="2"> <text>file a revised antifraud plan after disapproval by the Commissioner of the initial antifraud plan; or</text> </level> <level label="3"> <text>comply with the antifraud plan filed by the authorized insurer.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-804" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="8" subtitle_name="Reporting and Preventing Insurance Fraud"> <level label="a"> <text>Each viatical settlement provider shall have in place an antifraud plan reasonably calculated to detect, prosecute, and prevent fraudulent viatical settlement acts.</text> </level> <level label="b"> <text>Within 30 days after instituting or modifying an antifraud plan, the viatical settlement provider shall notify the Commissioner in writing.</text> </level> <level label="c"> <text>Each antifraud plan shall include:</text> <level label="1"> <text>the use of fraud investigators;</text> </level> <level label="2"> <text>a description of the procedures for detecting and investigating possible fraudulent viatical settlement acts and procedures for resolving material inconsistencies between medical records and insurance applications;</text> </level> <level label="3"> <text>a description of the procedures for reporting possible fraudulent viatical settlement acts to the Commissioner;</text> </level> <level label="4"> <text>a description of the plan for antifraud education and training of underwriters, and other personnel; and</text> </level> <level label="5"> <text>a description or chart outlining the organizational arrangement of the antifraud personnel who are responsible for the investigation and reporting of possible fraudulent viatical settlement acts and investigating unresolved material inconsistencies between medical records and insurance applications.</text> </level> </level> <level label="d"> <text>An antifraud plan submitted to the Commissioner shall be privileged and confidential and shall not be a public record and shall not be subject to discovery or subpoena in a civil or criminal action.</text> </level> <level label="e"> <level label="1"> <text>Each viatical settlement provider shall file its antifraud plan with the Commissioner.</text> </level> <level label="2"> <text>The Commissioner may review each antifraud plan to determine whether it complies with the requirements of this section.</text> </level> <level label="3"> <text>An antifraud plan is deemed approved unless disapproved by the Commissioner within 30 days after the date of filing.</text> </level> </level> <level label="f"> <level label="1"> <text>If the Commissioner finds that an antifraud plan does not comply with the requirements of this section, the Commissioner shall disapprove the antifraud plan and send a notice of disapproval, including the reasons for disapproval, to the viatical settlement provider.</text> </level> <level label="2"> <text>If the Commissioner disapproves an antifraud plan, the viatical settlement provider shall submit a new antifraud plan to the Commissioner within 60 days after the date of disapproval.</text> </level> </level> <level label="g"> <text>It is a violation of this subtitle if the Commissioner finds that a viatical settlement provider has failed to:</text> <level label="1"> <text>file an antifraud plan;</text> </level> <level label="2"> <text>file a revised antifraud plan after disapproval by the Commissioner of the initial antifraud plan; or</text> </level> <level label="3"> <text>comply with the antifraud plan filed by the viatical settlement provider.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-805" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="8" subtitle_name="Reporting and Preventing Insurance Fraud"> <level label="a"> <text>In this section, “claim form” means any document supplied by an insurer to a claimant that a claimant is required to complete and submit in support of a claim for benefits.</text> </level> <level label="b"> <level label="1"> <text>Except as provided in subsection (c) of this section, all applications for insurance and all claim forms, regardless of the form of transmission, shall contain the following statement or a substantially similar statement:</text> <text>“Any person who knowingly or willfully presents a false or fraudulent claim for payment of a loss or benefit or who knowingly or willfully presents false information in an application for insurance is guilty of a crime and may be subject to fines and confinement in prison.” </text> </level> <level label="2"> <text>The lack of the statement required by paragraph (1) of this subsection does not constitute a defense in any legal proceeding.</text> </level> </level> <level label="c"> <text>Subsection (b)(1) of this section does not apply to:</text> <level label="1"> <text>reinsurance applications or claim forms; or</text> </level> <level label="2"> <text>the uniform claims form for reimbursement of hospital services or the uniform claims form for reimbursement of health care practitioners services adopted by the Commissioner under § 15–1003 of this article.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-806" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="8" subtitle_name="Reporting and Preventing Insurance Fraud"> <text>The penalty for a violation of this subtitle is as provided in §§ 4–113 and 4–114 of this article.</text> </section> <section article="gin" article_name="Insurance" number="27-901" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Credit life or disability insurance” means a type of insurance that will pay all or part of an individual’s debt on the death or disability of the individual.</text> </level> <level label="3"> <text>“Finance charge” has the meaning stated in § 12-501 of the Commercial Law Article.</text> </level> <level label="4"> <text>“Retail credit account” has the meaning stated in § 12-501 of the Commercial Law Article.</text> </level> </level> <level label="b"> <text>A person may not make, issue, charge, or cause to be made, issued, or charged to an individual any type of premium for credit life or disability insurance without the express written consent of the individual.</text> </level> <level label="c"> <text>The computation of a finance charge in a retail credit account may not be based in any part on the premiums due under a policy of credit life or disability insurance.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-902" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <text>A policy or contract of motor vehicle insurance may not be canceled or nonrenewed solely because of:</text> <level label="1"> <text>the age of the holder of the policy or contract; or</text> </level> <level label="2"> <text>the physical handicap or disability of the holder of the policy or contract.</text> </level> </level> <level label="b"> <text>The premium for a policy or contract of motor vehicle insurance may not be increased solely because:</text> <level label="1"> <text>an insured under the policy or contract is older than 65 years of age; or</text> </level> <level label="2"> <text>the holder of the policy or contract has a physical handicap or disability, unless there is actuarial justification for the increase.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-903" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <text>An insurer that submits to its policyholder a notice of initial or renewal premium due shall indicate the kind of insurance coverage for which the policyholder is being charged.</text> </section> <section article="gin" article_name="Insurance" number="27-904" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <text>An annuity contract may not contain a provision that reduces payments to an individual entitled to receive annuity payments under the contract because the individual receives an increase in Social Security payments.</text> </section> <section article="gin" article_name="Insurance" number="27-905" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <text>An insurer may not send a billing statement to a policyholder under a policy or contract of motor vehicle liability insurance unless the billing statement includes a date by which any payment due under the billing statement must be received by the insurer for the insurance coverage to continue without penalty.</text> </level> <level label="b"> <text>An insurer may not use false or misleading language in a billing statement to induce the policyholder to pay a premium before it is required by the insurer.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-906" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <text>An insurer that issues or delivers in the State a policy of motor vehicle liability insurance that provides coverage for the repair of physical damage to the motor vehicle shall provide, on request of the insured, a copy of the warranty for aftermarket crash parts, if available.</text> </section> <section article="gin" article_name="Insurance" number="27-907" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <text>An insurer that issues or renews a private passenger motor vehicle insurance policy in the State shall give an actuarially justified discount in rate to each individual who has completed the immediately preceding 3 years of continuous coverage with that insurer without a moving traffic violation, with not more than one point, and with no chargeable traffic accident.</text> </section> <section article="gin" article_name="Insurance" number="27-909" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Gene product” means the biochemical material, either RNA or protein, made by a gene.</text> </level> <level label="3"> <level label="i"> <text>“Genetic information” means information:</text> <level label="1"> <text>about chromosomes, genes, gene products, or inherited characteristics that may derive from an individual or a family member;</text> </level> <level label="2"> <text>obtained for diagnostic and therapeutic purposes; and</text> </level> <level label="3"> <text>obtained at a time when the individual to whom the information relates is asymptomatic for the disease.</text> </level> </level> <level label="ii"> <text>“Genetic information” does not include:</text> <level label="1"> <text>routine physical measurements;</text> </level> <level label="2"> <text>chemical, blood, and urine analyses that are widely accepted and in use in clinical practice;</text> </level> <level label="3"> <text>tests for use of drugs; or</text> </level> <level label="4"> <text>tests for the presence of the human immunodeficiency virus.</text> </level> </level> </level> <level label="4"> <text>“Genetic services” means health services that are provided to obtain, assess, and interpret genetic information for diagnostic and therapeutic purposes and for genetic education and counseling.</text> </level> <level label="5"> <text>“Genetic test” means a laboratory test of human chromosomes, genes, or gene products that is used to identify the presence or absence of inherited or congenital alterations in genetic material that are associated with disease or illness.</text> </level> </level> <level label="b"> <text>This section does not apply to life insurance policies, annuity contracts, long–term care insurance policies, or disability insurance policies.</text> </level> <level label="c"> <text>An insurer, nonprofit health service plan, or health maintenance organization may not:</text> <level label="1"> <text>use a genetic test, the results of a genetic test, genetic information, or a request for genetic services, to reject, deny, limit, cancel, refuse to renew, increase the rates of, affect the terms or conditions of, or otherwise affect a health insurance policy or contract;</text> </level> <level label="2"> <text>request or require a genetic test, the results of a genetic test, or genetic information for the purpose of determining whether or not to issue or renew health benefits coverage; or</text> </level> <level label="3"> <text>release identifiable genetic information or the results of a genetic test to any person who is not an employee of the insurer, nonprofit health service plan, or health maintenance organization or a participating health care provider who provides medical services to insureds or enrollees without the prior written authorization of the individual from whom the test results or genetic information was obtained.</text> </level> </level> <level label="d"> <text>Disclosure of identifiable genetic information to an employee or health care provider authorized under subsection (c)(3) of this section shall only be for the purpose of:</text> <level label="1"> <text>providing medical care to patients; or</text> </level> <level label="2"> <text>conducting research that has been approved by an institutional review board established in accordance with federal law.</text> </level> </level> <level label="e"> <text>The authorization described in subsection (c)(3) of this section is required for each disclosure and shall describe the individual or entities making the disclosure, to whom the disclosure is to be made, and the information to be disclosed.</text> </level> <level label="f"> <level label="1"> <text>For purposes of this subsection, §§ 4–113 and 4–114 of this article and §§ 27–501 and 27–505 of this title apply to nonprofit health service plans and health maintenance organizations.</text> </level> <level label="2"> <text>The Commissioner may issue an order under §§ 4–113 and 4–114 of this article and §§ 27–501 and 27–505 of this title if the Commissioner finds a violation of this section.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-909.1" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Genetic test” means an analysis of human DNA, RNA, chromosomes, proteins, or metabolites that detects genotypes, mutations, or chromosomal changes.</text> </level> <level label="3"> <text>“Insurance carrier” means a company authorized to sell insurance policies in the State.</text> </level> </level> <level label="b"> <level label="1"> <text>This section applies only to life insurance and disability insurance policies or contracts.</text> </level> <level label="2"> <text>This section does not prohibit an insurance carrier that offers, issues, or delivers a life insurance or disability insurance policy or contract in the State from:</text> <level label="i"> <text>accessing an applicant’s medical record as part of the application process; or</text> </level> <level label="ii"> <text>considering a medical diagnosis included in an individual’s medical record, even if the diagnosis was based on the results of a genetic test.</text> </level> </level> </level> <level label="c"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection and subject to paragraph (3) of this subsection, an insurance carrier that offers, issues, or delivers a life insurance or disability insurance policy or contract in the State may not unfairly discriminate against an individual by conditioning insurance rates, the provision or renewal of insurance coverage, or other conditions of insurance based on medical information, including the results of a genetic test for which there is not a relationship between the medical information and the cost of the insurance risk that the insurer would assume by insuring the applicant.</text> </level> <level label="2"> <text>In demonstrating the relationship described in paragraph (1) of this subsection, the insurer may rely on actuarially sound principles or actual or reasonably anticipated experience.</text> </level> <level label="3"> <text>An insurance carrier that offers, issues, or delivers a life insurance or disability insurance policy or contract in the State may not:</text> <level label="i"> <text>access sensitive medical information, including the genetic data of an individual, without first obtaining the individual’s signed, written consent; or</text> </level> <level label="ii"> <text>mandate existing or new genetic testing or full genome sequencing as a prerequisite for life insurance or disability insurance eligibility or coverage.</text> </level> </level> <level label="4"> <text>The insurance carrier, applicant, or policy or contract holder may not waive the provisions of paragraph (3)(ii) of this subsection under any circumstances.</text> </level> </level> <level label="d"> <text>The Commissioner may issue an order under §§ 4–113 and 4–114 of this article or §§ 27–501 and 27–505 of this title if the Commissioner finds a violation of this section.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-910" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Enrollee” means an individual or member of an association or other private group arrangement entitled to health care services from a health network.</text> </level> <level label="3"> <text>“Health care service” has the meaning stated in § 19-701 of the Health - General Article.</text> </level> <level label="4"> <text>“Health network” means an entity that:</text> <level label="i"> <text>holds a certificate of authority under this article or Title 19, Subtitle 7 of the Health - General Article; and</text> </level> <level label="ii"> <text>is organized to provide health care services to individuals or an enrolled population in a regional or service area.</text> </level> </level> </level> <level label="b"> <text>A health network may not deny health care services to an enrollee on the basis of sex, sexual orientation, gender identity, race, age, religion, national origin, or a protected category under the Americans with Disabilities Act.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-911" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <text>Each authorized insurer doing business in the State shall accept and honor each request by a policyholder for a change of insurance producer of record within 30 working days after receipt of the request unless the policyholder withdraws the request in writing.</text> </level> <level label="b"> <text>The new insurance producer of record must have a current appointment and contract with the authorized insurer before the change of insurance producer of record will be effective.</text> </level> <level label="c"> <level label="1"> <text>Subject to the provisions of paragraph (2) of this subsection, the new insurance producer of record shall be paid all commissions payable on the policy effective not later than the next anniversary date of the policy following the effective date of change.</text> </level> <level label="2"> <text>The commissions payable under paragraph (1) of this subsection do not include:</text> <level label="i"> <text>vested life insurance commissions;</text> </level> <level label="ii"> <text>supplemental health insurance commissions; or</text> </level> <level label="iii"> <text>commissions or other compensation payable under an insurer’s retirement or deferred compensation plan with the insurance producer.</text> </level> </level> </level> <level label="d"> <text>A request for a change of insurance producer of record shall:</text> <level label="1"> <text>be in writing; and</text> </level> <level label="2"> <text>include:</text> <level label="i"> <text>the policyholder’s name and address;</text> </level> <level label="ii"> <text>the authorized insurer’s name and address;</text> </level> <level label="iii"> <text>the policy number;</text> </level> <level label="iv"> <text>the name and address of the new insurance producer of record;</text> </level> <level label="v"> <text>the date of the request;</text> </level> <level label="vi"> <text>the signature of the policyholder; and</text> </level> <level label="vii"> <text>the signature of acceptance by the new insurance producer.</text> </level> </level> </level> <level label="e"> <text>This section does not require an authorized insurer to:</text> <level label="1"> <text>appoint and contract with an insurance producer of record;</text> </level> <level label="2"> <text>alter an insurer’s existing contract with an insurance producer which provides for direct compensation in lieu of commission; and</text> </level> <level label="3"> <text>require the payment of full commissions to a new insurance producer where the original writing insurance producer or current insurance producer continues to have responsibility for processing and matters relating to the policyholder.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="27-912" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <text>An insurer that accepts a transfer of the insurance business of a group of policyholders from an independent insurance producer may treat the policies transferred as renewals and not as new policies for underwriting purposes.</text> </section> <section article="gin" article_name="Insurance" number="27-913" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <text>This section applies to:</text> <level label="1"> <text>insurers and nonprofit health service plans that provide hospital, medical, or surgical benefits to individuals or groups on an expense-incurred basis under health insurance policies or contracts that are issued or delivered in the State; and</text> </level> <level label="2"> <text>health maintenance organizations that provide hospital, medical, or surgical benefits to individuals or groups under contracts that are issued or delivered in the State.</text> </level> </level> <level label="b"> <text>Unless otherwise provided by law, an entity subject to this section may not make benefits under a policy or contract issued or delivered by the entity in the State for the treatment of a specified disease or diagnosis subject to different copayment amounts, coinsurance, deductibles, annual maximum limits, or lifetime maximum limits than those that apply to all other diseases covered under the policy or contract.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-914" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <text>This section does not apply to life insurance policies, annuity contracts, long–term care insurance policies, or disability insurance policies.</text> </level> <level label="b"> <text>An insurer that provides health insurance, a nonprofit health service plan, or a health maintenance organization may not use race or ethnicity data to reject, deny, limit, cancel, refuse to renew, increase the rates of, affect the terms or conditions of, or otherwise affect a health insurance policy or contract.</text> </level> <level label="c"> <text>The Commissioner may issue an order under §§ 4–113 and 4–114 of this article and §§ 27–501 and 27–505 of this title if the Commissioner finds a violation of this section.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-915" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="9" subtitle_name="Miscellaneous Provisions"> <level label="a"> <text>In this section, “organ transplantation” means the transplantation or transfusion of a human body part into the body of another individual for the purpose of treating or curing a medical condition.</text> </level> <level label="b"> <text>This section applies to:</text> <level label="1"> <text>insurers and nonprofit health service plans that provide coverage for organ transplantation to individuals or groups on an expense–incurred basis under health insurance policies or contracts that are issued or delivered in the State; and</text> </level> <level label="2"> <text>health maintenance organizations that provide coverage for organ transplantation to individuals or groups under contracts that are issued or delivered in the State.</text> </level> </level> <level label="c"> <text>An entity subject to this section may not deny coverage for an organ transplantation solely on the basis of an insured’s or enrollee’s disability.</text> </level> <level label="d"> <text>This section may not be construed to require an entity subject to this section to provide coverage for an organ transplantation that is not medically necessary.</text> </level> </section> <section article="gin" article_name="Insurance" number="27-1001" title_number="27" title_name="Unfair Trade Practices and Other Prohibited Practices" subtitle_number="10" subtitle_name="Property and Casualty Insurance -- First-Party Claims"> <level label="a"> <text>In this section, “good faith” means an informed judgment based on honesty and diligence supported by evidence the insurer knew or should have known at the time the insurer made a decision on a claim.</text> </level> <level label="b"> <text>This section applies only to actions under § 3–1701 of the Courts Article.</text> </level> <level label="c"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection, a person may not bring or pursue an action under § 3–1701 of the Courts Article in a court unless the person complies with this section.</text> </level> <level label="2"> <text>Paragraph (1) of this subsection does not apply to an action:</text> <level label="i"> <text>within the small claim jurisdiction of the District Court under § 4–405 of the Courts Article;</text> </level> <level label="ii"> <text>if the insured and the insurer agree to waive the requirement under paragraph (1) of this subsection; or</text> </level> <level label="iii"> <text>under a commercial insurance policy on a claim with respect to which the applicable limit of liability exceeds $1,000,000.</text> </level> </level> </level> <level label="d"> <level label="1"> <text>A complaint stating a cause of action under § 3–1701 of the Courts Article shall first be filed with the Administration.</text> </level> <level label="2"> <text>The complaint shall:</text> <level label="i"> <text>be accompanied by each document that the insured has submitted to the insurer for proof of loss;</text> </level> <level label="ii"> <text>specify the applicable insurance coverage and the amount of the claim under the applicable coverage; and</text> </level> <level label="iii"> <text>state the amount of actual damages, and the claim for expenses and litigation costs described under subsection (e)(2) of this section.</text> </level> </level> <level label="3"> <text>The Administration shall forward the filing to the insurer.</text> </level> <level label="4"> <text>Within 30 days after the date the filing is forwarded to the insurer by the Administration, the insurer shall:</text> <level label="i"> <text>file with the Administration, except for good cause shown, a written response together with a copy of each document from the insurer’s claim file that enables reconstruction of the insurer’s activities relative to the insured’s claim, including documentation of each pertinent communication, transaction, note, work paper, claim form, bill, and explanation of benefits form relative to the claim; and</text> </level> <level label="ii"> <text>mail to the insured a copy of the response and, except for good cause shown, each document from the insurer’s claim file that enables reconstruction of the insurer’s activities relative to the insured’s claim, including documentation of each pertinent communication, transaction, note, work paper, claim form, bill, and explanation of benefits form relative to the claim.</text> </level> </level> </level> <level label="e"> <level label="1"> <level label="i"> <text>Within 90 days after the date the filing was received by the Administration, the Administration shall issue a decision that determines:</text> <level label="1"> <text>whether the insurer is obligated under the applicable policy to cover the underlying first–party claim;</text> </level> <level label="2"> <text>the amount the insured was entitled to receive from the insurer under the applicable policy on the underlying covered first–party claim;</text> </level> <level label="3"> <text>whether the insurer breached its obligation under the applicable policy to cover and pay the underlying covered first–party claim, as determined by the Administration;</text> </level> <level label="4"> <text>whether an insurer that breached its obligation failed to act in good faith; and</text> </level> <level label="5"> <text>the amount of damages, expenses, litigation costs, and interest, as applicable and as authorized under paragraph (2) of this subsection.</text> </level> </level> <level label="ii"> <text>The failure of the Administration to issue a decision within the time specified in subparagraph (i) of this paragraph shall be considered a determination that the insurer did not breach any obligation to the insured.</text> </level> </level> <level label="2"> <text>With respect to the determination of damages under paragraph (1)(i)5 of this subsection:</text> <level label="i"> <text>if the Administration finds that the insurer breached an obligation to the insured, the Administration shall determine the obligation of the insurer to pay:</text> <level label="1"> <text>actual damages, which actual damages may not exceed the limits of any applicable policy; and</text> </level> <level label="2"> <text>interest on all actual damages incurred by the insured computed:</text> </level> <level label="A"> <text>at the rate allowed under § 11–107(a) of the Courts Article; and</text> </level> <level label="B"> <text>from the date on which the insured’s claim should have been paid; and</text> </level> </level> <level label="ii"> <text>if the Administration also finds that the insurer failed to act in good faith, the Administration shall also determine the obligation of the insurer to pay:</text> <level label="1"> <text>expenses and litigation costs incurred by the insured, including reasonable attorney’s fees, in pursuing recovery under this subtitle; and</text> </level> <level label="2"> <text>interest on all expenses and litigation costs incurred by the insured computed:</text> </level> <level label="A"> <text>at the rate allowed under § 11–107(a) of the Courts Article; and</text> </level> <level label="B"> <text>from the applicable date or dates on which the insured’s expenses and costs were incurred.</text> </level> </level> </level> <level label="3"> <text>An insurer may not be found to have failed to act in good faith under this section solely on the basis of delay in determining coverage or the extent of payment to which the insured is entitled if the insurer acted within the time period specified by statute or regulation for investigation of a claim by an insurer.</text> </level> <level label="4"> <text>The amount of the attorney’s fees determined to be payable to an insured under paragraph (2) of this subsection may not exceed one–third of the actual damages payable to the insured.</text> </level> <level label="5"> <text>The Administration shall serve a copy of the decision on the insured and the insurer in accordance with § 2–204(c) of this article.</text> </level> </level> <level label="f"> <level label="1"> <text>If a party receives an adverse decision, the party shall have 30 days after the date of service of the Administration’s decision to request a hearing.</text> </level> <level label="2"> <text>All hearings requested under this section shall:</text> <level label="i"> <text>be referred by the Commissioner to the Office of Administrative Hearings for a final decision under Title 10, Subtitle 2 of the State Government Article;</text> </level> <level label="ii"> <text>be heard de novo; and</text> </level> <level label="iii"> <text>result in a final decision that makes the determinations set forth in subsection (e) of this section.</text> </level> </level> <level label="3"> <text>If no administrative hearing is requested in accordance with paragraph (1) of this subsection, the decision issued by the Administration shall become a final decision.</text> </level> </level> <level label="g"> <level label="1"> <text>If a party receives an adverse decision, the party may appeal a final decision by the Administration or an administrative law judge under this section to a circuit court in accordance with § 2–215 of this article and Title 10, Subtitle 2 of the State Government Article.</text> </level> <level label="2"> <level label="i"> <text>This paragraph applies only if more than one party receives an adverse decision from the Administration.</text> </level> <level label="ii"> <text>If a party requests a hearing before the Office of Administrative Hearings and another party files an appeal to a circuit court:</text> <level label="1"> <text>jurisdiction over the request for hearing is transferred to the circuit court;</text> </level> <level label="2"> <text>the request for hearing, the Administration’s decision, and the Administration’s case file, including the complaint, response, and all documents submitted to the Administration, shall be transmitted promptly to the circuit court; and</text> </level> <level label="3"> <text>the request for hearing shall be docketed in the circuit court and consolidated for trial with the appeal.</text> </level> </level> </level> <level label="3"> <text>Notwithstanding any other provision of law, an appeal to a circuit court under this section shall be heard de novo.</text> </level> </level> <level label="h"> <text>On or before January 1 of each year beginning in 2009, in accordance with § 2–1257 of the State Government Article, the Administration shall report to the General Assembly on the following for the prior fiscal year:</text> <level label="1"> <text>the number and types of complaints under this section or § 3–1701 of the Courts Article from insureds regarding first–party insurance claims under property and casualty insurance policies;</text> </level> <level label="2"> <text>the number and types of complaints under this section or § 3–1701 of the Courts Article from insureds regarding first–party insurance claims under individual disability insurance policies;</text> </level> <level label="3"> <text>the administrative and judicial dispositions of the complaints described in items (1) and (2) of this subsection;</text> </level> <level label="4"> <text>the number and types of regulatory enforcement actions instituted by the Administration for unfair claim settlement practices under § 27–303(9) or § 27–304(18) of this title; and</text> </level> <level label="5"> <text>the administrative and judicial dispositions of the regulatory enforcement actions for unfair claim settlement practices described under item (4) of this subsection.</text> </level> </level> </section>