Definitions. As used in this act:
a. "Adverse underwriting decision" means:
(1) Any of the following actions with respect to insurance transactions involving insurance coverage which is individually underwritten for an individual:
(a) A declination of insurance coverage,
(b) A termination of insurance coverage,
(c) Failure of an agent to apply for insurance coverage with a specific insurance institution which the agent represents and which is requested by an applicant,
(d) In the case of a property or casualty insurance coverage:
(i Placement by an insurance institution or agent of a risk with a residual market mechanism or an unauthorized insurer, or
(ii) The charging of a higher rate on the basis of information which differs from that which the applicant or policyholder furnished,
(e) In the case of a life, health or disability insurance coverage, an offer to insure at a higher rate than the insurance institution's table of premium rates applicable to the age and class of risk of each person to be covered under that coverage and to the type and amount of insurance provided.
(2) Notwithstanding paragraph (1) above, the following actions, if permitted by law, shall not be considered adverse underwriting decisions but the insurance institution or agent responsible for their occurrence shall nevertheless provide the applicant or policyholder with the specific reason or reasons for their occurrence:
(a) The termination of an individual policy form on a class or Statewide basis,
(b) A declination of insurance coverage solely because such coverage is not available on a class or Statewide basis, or
(c) The rescission of a policy.
b. "Affiliate" or "affiliated" means a person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with another person.
c. "Agent" means any person defined in chapter 22 of Title 17 of the Revised Statutes, chapter 22 of Title 17B of the New Jersey Statutes and in R.S. 17:35-23.
d. "Applicant" means a person who seeks to contract for insurance coverage other than a person seeking group insurance that is not individually underwritten.
e. "Commissioner" means the Commissioner of Insurance.
f. "Consumer report" means any written, oral or other communication of information bearing on a natural person's creditworthiness, credit standing, credit capacity, character, general reputation, personal characteristics or mode of living which is used or expected to be used in connection with an insurance transaction.
g. "Consumer reporting agency" means any person who:
(1) Regularly engages, in whole or in part, in the practice of assembling or preparing consumer reports, for a monetary fee, and
(2) Obtains information primarily from sources other than insurance institutions, and (3) Furnishes consumer reports to other persons.
h. "Control," including the terms "controlled by" or "under common control with," means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a commercial contract of goods or nonmanagement services, or otherwise, unless the power is the result of an official position with or corporate office held by the person.
i. "Declination of insurance coverage" means a denial, in whole or in part, by an insurance institution or agent of requested insurance coverage.
j. "Individual" means any natural person who:
(1) In the case of property or casualty insurance, is a past, present or proposed named insured or certificateholder;
(2) In the case of life, health or disability insurance, is a past, present or proposed principal insured or certificateholder;
(3) Is a past, present or proposed policyowner;
(4) Is a past or present applicant; or
(5) Is a past or present claimant; or
(6) Derived, derives or is proposed to derive insurance coverage under an insurance policy or certificate subject to this act.
k. "Institutional source" means any person or governmental entity that provides information about an individual to an agent, insurance institution or insurance support organization, other than:
(1) An agent,
(2) The individual who is the subject of the information, or
(3) A natural person acting in a personal capacity rather than in a business or professional capacity.
l. "Insurance institution" means any corporation, association, partnership, reciprocal exchange, interinsurer, Lloyd's insurer, fraternal benefit society or other person engaged in the business of insurance, including health maintenance organizations, medical service corporations, hospital service corporations, dental service corporations, automobile insurance plans and the New Jersey Automobile Full Insurance Underwriting Association as defined in section 2 of P.L. 1973, c. 337 (C. 26:2J-2), section 1 of P.L. 1940, c. 74 (C. 17:48A-1), section 1 of P.L. 1960, c. 1 (C. 17:48B-1), section 2 of P.L. 1968, c. 305 (C. 17:48C-2), P.L. 1970, c. 215 (C. 17:29D-1 et seq.) and P.L. 1983, c. 65 (C. 17:29A-33 et al.), respectively. "Insurance institution" shall not include agents or insurance-support organizations.
m. "Insurance-support organization" means:
(1) Any person who regularly engages, in whole or in part, in the practice of assembling or collecting information about natural persons for the primary purpose of providing the information to an insurance institution or agent for insurance transactions, including
(a) The furnishing of consumer reports or investigative consumer reports to an insurance institution or agent for use in connection with an insurance transaction, or
(b) The collection of personal information from insurance institutions, agents or other insurance-support organizations for the purpose of detecting or preventing fraud, material misrepresentation or material nondisclosure in connection with insurance underwriting or insurance claim activity. (2) Notwithstanding paragraph (1) of this subsection, the following persons shall not be considered "insurance-support organizations" for the purposes of this act: agents, government institutions, insurance institutions, medical-care institutions, medical professionals and rating organizations as defined in section 1 of P.L. 1944, c. 27 (C. 17:29A-1).
n. "Insurance transaction" means any transaction involving insurance primarily for personal, family or household needs rather than business or professional needs which entails:
(1) The determination of an individual's eligibility for an insurance coverage, benefit or payment, or
(2) The servicing of an insurance application, policy, contract or certificate.
o. "Investigative consumer report" means a consumer report or portion thereof in which information about a natural person's character, general reputation, personal characteristics or mode of living is obtained through personal interviews with the person's neighbors, friends, associates, acquaintances or others who may have knowledge concerning those items of information.
p. "Medical-care institution" means a facility or institution that is licensed to provide health care services to natural persons, including but not limited to hospitals, skilled nursing facilities, nursing facilities, home-health agencies, medical clinics, rehabilitation agencies, public health agencies or health maintenance organizations.
q. "Medical professional" means any person providing health care services to natural persons, including but not limited to a physician, podiatrist, dentist, nurse, optometrist, chiropractor, physical therapist, occupational therapist, pharmacist, psychologist, dietitian, psychiatric social worker or speech therapist.
r. "Medical-record information" means personal information which:
(1) Relates to an individual's physical or mental condition, medical history or medical treatment, and
(2) Is obtained from a medical professional or medical-care institution, from the individual, or from the individual's spouse, parent or legal guardian.
s. "Person" means any natural person, corporation, association, partnership or other legal entity.
t. "Personal information" means any individually identifiable information gathered in connection with an insurance transaction from which judgments can be made about an individual's character, habits, avocations, finances, occupation, general reputation, credit, health or any other personal characteristics. "Personal information" includes an individual's name and address and medical-record information but does not include privileged information.
u. "Policyholder" means any person who:
(1) In the case of individual property or casualty insurance, is a present named insured;
(2) In the case of individual life, health or disability insurance, is a present policyowner; or
(3) In the case of group insurance which is individually underwritten, is a present group certificateholder.
v. "Pretext interview" means an interview whereby a person, in an attempt to obtain information about a natural person, performs one or more of the following acts:
(1) Pretends to be someone he is not,
(2) Pretends to represent a person he is not in fact representing, (3) Misrepresents the true purpose of the interview, or
(4) Refuses to identify himself upon request.
w. "Privileged information" means any individually identifiable information that:
(1) Relates to a claim for insurance benefits or a civil or criminal proceeding involving an individual, and
(2) Is collected in connection with or in reasonable anticipation of a claim for insurance benefits or civil or criminal proceeding involving an individual; except that information otherwise meeting the requirements of this subsection shall nevertheless be considered personal information under this act if it is disclosed in violation of section 13 of this act.
x. "Residual market mechanism" means any insurance pooling mechanism, joint underwriting association, or reinsurance facility created pursuant to law or regulation which provides insurance coverage for any risk that is not insurable in the voluntary market.
y. "Termination of insurance coverage" or "termination of an insurance policy" means either a cancellation or nonrenewal of an insurance policy, in whole or in part, for any reason other than the failure to pay a premium as required by the policy.
z. "Unauthorized insurer" means an insurance institution that has not been granted a certificate of authority by the commissioner to transact the business of insurance in this State.
L. 1985, c. 179, s. 2.
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Last modified: October 11, 2016