33-19-303. Reasons for adverse underwriting decisions. (1) If an adverse underwriting decision is made, the insurance institution or insurance producer responsible for the decision shall:

Terms Used In Montana Code 33-19-303

  • Adverse underwriting decision: means any of the following actions with respect to insurance transactions involving insurance coverage that are individually underwritten:

    (i)a declination of insurance coverage;

    (ii)a termination of insurance coverage;

    (iii)failure of an insurance producer to apply for insurance coverage with a specific insurance institution that the insurance producer represents and that is requested by an applicant;

    (iv)in the case of a property or casualty insurance coverage:

    (A)placement by an insurance institution or insurance producer of a risk with a residual market mechanism, an unauthorized insurer, or an insurance institution that specializes in substandard risks; or

    (B)the charging of a higher rate on the basis of information that differs from that which the applicant or policyholder furnished;

    (v)in the case of a life, health, or disability insurance coverage, an offer to insure at higher than standard rates. See Montana Code 33-19-104

  • Applicant: means a person who seeks to contract for insurance coverage other than a person seeking group insurance that is not individually underwritten. See Montana Code 33-19-104
  • Fraud: Intentional deception resulting in injury to another.
  • Individual: means a natural person who:

    (a)regarding property or casualty insurance, is a past, present, or proposed named insured or certificate holder;

    (b)regarding life, health, or disability insurance, is a past, present, or proposed principal insured or certificate holder;

    (c)is a past, present, or proposed policyowner;

    (d)is a past or present applicant;

    (e)is a past or present claimant; or

    (f)derived, derives, or is proposed to derive insurance coverage under an insurance policy or certificate subject to this chapter. See Montana Code 33-19-104

  • Insurance institution: means a 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, and health service corporations as defined in 33-30-101. See Montana Code 33-19-104
  • Insurance producer: means an insurance producer as defined in 33-17-102 and 33-30-311. See Montana Code 33-19-104
  • Medical care institution: means a facility or institution that is licensed to provide health care services to natural persons, including but not limited to health maintenance organizations, home health agencies, hospitals, medical clinics, public health agencies, rehabilitation agencies, and skilled nursing facilities. See Montana Code 33-19-104
  • Medical professional: means a person who is licensed or certified to provide health care services to natural persons, including but not limited to a chiropractor, clinical dietitian, clinical psychologist, dentist, nurse, occupational therapist, optometrist, pharmacist, physical therapist, physician, podiatrist, psychiatric social worker, or speech-language pathologist. See Montana Code 33-19-104
  • Medical record information: means personal information that:

    (a)relates to an individual's physical or mental condition, medical history, medical claims history, or medical treatment; and

    (b)is obtained from a medical professional or medical care institution, from the individual, or from the individual's spouse, parent, or legal guardian. See Montana Code 33-19-104

  • Person: means a natural person, corporation, association, partnership, or other legal entity. See Montana Code 33-19-104
  • Policyholder: means a person who:

    (a)in the case of individual property or casualty insurance, is a present named insured;

    (b)in the case of individual life, health, or disability insurance, is a present policyowner; or

    (c)in the case of group insurance that is individually underwritten, is a present group certificate holder. See Montana Code 33-19-104

  • Privileged information: means any individually identifiable information that:

    (a)relates to a civil or criminal proceeding involving an individual; and

    (b)is collected in connection with or in reasonable anticipation of a claim for insurance benefits or civil or criminal proceeding involving an individual. See Montana Code 33-19-104

  • Writing: includes printing. See Montana Code 1-1-203

(a)either provide the applicant, policyholder, or individual proposed for coverage with the specific reason or reasons for the adverse underwriting decision in writing or advise the person that upon written request, the person may receive the specific reason or reasons in writing; and

(b)provide the applicant, policyholder, or individual proposed for coverage with a summary of the rights established under subsection (2) and 33-19-301 and 33-19-302.

(2)If a written request is received within 90 business days from the date of the mailing of notice or other communication of an adverse underwriting decision to an applicant, policyholder, or individual proposed for coverage, the insurance institution or insurance producer shall within 21 business days from the date of receipt of the written request furnish the person:

(a)the specific reason or reasons for the adverse underwriting decision, in writing, if the information was not initially furnished in writing pursuant to subsection (1)(a);

(b)the specific items of personal and privileged information that support those reasons; however:

(i)the insurance institution or insurance producer is not required to furnish specific items of privileged information if it has a reasonable suspicion, based upon specific information available for review by the commissioner, that the applicant, policyholder, or individual proposed for coverage has engaged in criminal activity, fraud, material misrepresentation, or material nondisclosure; and

(ii)specific items of medical record information supplied by a medical care institution or medical professional must be disclosed either directly to the individual about whom the information relates or to a medical professional designated by the individual and licensed to provide medical care with respect to the condition to which the information relates, whichever the insurance institution or insurance producer prefers; and

(c)the names and addresses of the institutional sources that supplied the specific items of information pursuant to subsection (2)(b), except that the identity of any medical professional or medical care institution must be disclosed either directly to the individual or to the designated medical professional, whichever the insurance institution or insurance producer prefers.

(3)The obligations imposed by this section upon an insurance institution or insurance producer may be satisfied by another insurance institution or insurance producer that is authorized to act on its behalf.

(4)When an adverse underwriting decision results solely from an oral request or inquiry, the explanation of reasons and summary of rights required by subsection (1) may be given orally but must be made in writing at the request of the applicant, policyholder, or individual.

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