COI Law Changes Effective January 2022
Two important changes to insurance law took effect January 1, 2022, based on passage of SB 270 Insurance Technical Changes (sponsored by IIANC member Sen Todd Johnson) during the 2021 Session of the NC General Assembly:
1. NCGS § 58-2-164 was amended to allow insurers and agents up to 25 days of coverage binding to secure the evidence of reliable proof of residency and applicant's status as an eligible risk, as well clarify reliable proof of residency in the form of a utility bill or tax receipt taxes can be obtained using electronic versions of those documents.
2. A new section of law, NCGS § 58-3-149, was created for certificates of insurance that includes:
- Clarification that a certificate of insurance is to be prepared or issued exclusively by an insurance company or licensed producer.
- Expansion of the regulatory authority of the Commissioner of Insurance over any certificates of insurance submitted or created electronically.
- Establishment a civil penalty of up to $5,000 per offense to be imposed by the Commissioner of Insurance on third parties who request or require a certificate of insurance contain any false or misleading information about coverage contained in a policy.
IIANC has developed a short video and one-page fact sheet for our members to use to educate customers or any third party requesting a certificate of insurance about the new law. We worked with the NC Department of Insurance on this legislation and preparation of these materials, in response to members seeking help explaining to those requesting a certificate insurance about what’s permissible under the law.