Kentucky Gov. Signs E-Card Legislation

FRANKFORT, Ky., March 27 -- The Property Casualty Insurers Association of America issued the following news release:

Kentucky is the latest state to enact legislation that allows drivers to use their mobile devices to show their insurance identification card in order to prove they are insured and with adjournment March 26, consumers also benefited from Legislature's rejection of restrictions on credit-based insurance scoring and PIP reviews.

E-card legislation, HB 164, was signed by Gov. BeshearFriday March 22 and allows motorists to show either paper or electronic ID cards.

"Approval of HB 164 is good news for consumers and the courts," said Jeffrey Junkas, PCI regional manager. "Drivers can show they carry insurance in a traffic stop even without the little piece of paper in their glove compartment and courts can avoid unnecessary fix-it tickets. Without this bill, insurers are still required to send paper ID cards to each customer. This measure will enable insurers to keep up with change consumer behavior and offer more convenient options for those that want to go paperless."

In addition to the e-Card legislation, the Kentucky Department of Insurance (DOI) also recently addressed the issue of "Electronic Delivery of Notifications" and noted that current law provides for electronic delivery of a policy or renewal policy/certificate by agreement between the insurer and policyholder and is it also interprets the relevant statutes to allow, under certain conditions and with specific disclosure, electronic notice of cancellations, renewals, non-renewals, and premium increases. PCI advocated for such policies with the DOI this winter.

"These two actions by the legislature and department demonstrate Kentucky's forward thinking approach to meeting the needs of its citizens," said Junkas.

On the other hand, legislators rejected SB 197, which would have required two notices of cancellation being mailed to consumers. PCI and the industry strongly opposed this bill, as it would have been a very costly and confusing policy change. It would have resulted in double the notices, which would essentially double the costs. Additionally, two cancellation notices would further confuse policyholders that already get some of the most and earliest notices mandated of any state law on top of privacy notices.

"This legislation was not only costly, it ran counter to the national trend to move away from paper to electronic customer notices," said Junkas.

Onerous auto related legislation, HB 136, that would have mandated that credit-based insurance scores rate 'thin files' and 'no-hits' as neutral and SB 192, legislation to restrict insurers ability to manage costs in Personal Injury Protection (PIP) reviews or offer second opinions, was defeated. PCI testified against the credit bill which would have restricted the use of an actuarially sound component of calculating a credit-based insurance score and negatively impacted the Commonwealth's insurance market for all consumers.

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