§ 27-65-1 - Commercial special risks. - Rhode Island Statutes

SECTION 27-65-1

   § 27-65-1  Commercial special risks. –(a) Commercial special risks. Notwithstanding any other provisions ofthis title to the contrary and except as limited in subsection (b) of thissection, insurers shall not be required to file with, nor to receive approvalfrom, the insurance division of the department of business regulation forpolicy forms or rates used in the insurance of commercial special risks locatedin this state. Commercial special risks are defined as:

   (1) Risks written as commercial lines insurance, as definedin § 27-34-5(5), and which are written on an excess or umbrella basis;

   (2) Those risks, or portions of them, written as commerciallines insurance, as defined in § 27-34-5(5), and which are not ratedaccording to manuals, rating plans, or schedules including "A" rates;

   (3) Risks written as commercial lines insurance that employor retain the services of a "risk manager" and which also meet any one of thefollowing criteria:

   (i) Net worth over ten million dollars ($10,000,000);

   (ii) Net revenue/sales of over five million dollars($5,000,000);

   (iii) More than twenty-five (25) employees per individualcompany or fifty (50) employees per holding company in the aggregate;

   (iv) Aggregates premiums of over thirty thousand dollars($30,000) excluding group life, group health, workers' compensation andprofessional liability (including but not limited to errors and omissions anddirectors and officers liability);

   (v) Is a not for profit, or public entity with an annualbudget or assets of at least twenty-five million dollars ($25,000,000); or

   (vi) Is a municipality with a population of over twentythousand (20,000);

   (4) Specifically designated commercial special risksincluding:

   (i) All risks classified as highly protected risks.

   "Highly protected risk" means a fire resistive building thatmeets the highest standards of fire safety according to insurance companyunderwriting requirements;

   (ii) All commercial insurance aviation risks;

   (iii) All credit property insurance risks which are definedas "insurance of personal property of a commercial debtor against loss, withthe creditor as sole beneficiary" or "insurance of personal property of acommercial debtor, with the creditor as primary beneficiary and the debtor asbeneficiary of proceeds not paid to the creditor". For the purposes of thisdefinition, "personal property" means furniture, fixtures, furnishings,appliances and equipment designed for use in a business trade or profession andnot used by a debtor for personal or household use;

   (iv) All boiler and machinery risks;

   (v) All inland marine risks written as commercial linesinsurance as defined in § 27-34-5(5); and

   (vi) All fidelity and surety risks.

   (b) Notwithstanding subsection (a) of this section, thefollowing lines of business shall remain subject to all filing and approvalrequirements contained in this title even if written for risks which qualify ascommercial special risks:

   (1) Life insurance;

   (2) Annuities;

   (3) Accident and health insurance;

   (4) Automobile insurance which is mandated by statute;

   (5) Workers' compensation and employers' liability insurance;and

   (6) Issuance through residual market mechanisms.

   (c) Any insurer which provides coverage to a commercialspecial risk shall disclose to the insured that forms used and rates chargesare exempt from filing and approval requirements by this subsection. Records ofall such disclosures shall be maintained by the insurer.

   (d) Brokers for exempt commercial policyholders as defined insubdivision (a)(3) of this section shall be exempt from the due diligencerequirements of § 27-3-38(b).

   (e) Notwithstanding any other provisions of this title, therequirements of § 27-5-2 shall not apply to any policy insuring one ormore commercial special risks located in this state.