Minn. Session Sees Passage of Fraud, Tort Reform Bills

The 2004 Minnesota legislative session adjourned on May 16, with several insurance-related bills signed into law, and a fraud bill now on the governor’s desk.

“We saw a number of victories during the 2004 session, including several bills designed to stem frivolous lawsuits and a tough insurance fraud bill,” said Laura Kotelman, regional manager and senior counsel for the Property Casualty Insurers Association of America (PCI).

So far, insurance bills that have been signed into law include:

· H.F. 425, which helps insurers deal with frivolous class-action lawsuits by limiting appeal bond amounts to the actual amount of the judgment, with a $150 million cap.

· HF 2444, which deals with legal causes of action arising outside of Minnesota, enacting the NCCUSL Model Conflict of Laws Limitations Act.

· H.F. 2017, which allows the Minnesota Joint Underwriting Association to issue medical malpractice insurance policies on a primary basis to nursing facility applicants and other long-term care provider applicants.

Bills that have been presented to the governor for signature include:

· H.F. 2640, which establishes the Division of Insurance Fraud Prevention to conduct investigations and make arrests in relation to the enforcement of Minnesota insurance fraud law.

· H.F. 2175, mandating a study on dentist and podiatrist malpractice, and requiring the Board of Dentistry to make recommendations to the legislature by January 15, 2005, on proof of malpractice insurance and determining whether a minimum amount of insurance should be required for licensure.

· S.F. 1922, which prohibits insurers from refusing to renew, or declining to offer or write, homeowners insurance coverage solely to properties housing day care services for up to five children.

· S.F 2620, which clarifies the language regulating notice requirements in the event that a standard fire insurance policy is declined.

Several bills failed to pass the session, including H.F. 2670, the Department of Insurance’s omnibus bill, which included language governing the use of CLUE reports, and H.F. 1801, which would have allowed attorneys fees to homeowners who prevailed in construction defect litigation with their builders.

Chiropractors and physical therapists reportedly blocked the progress of H.F. 2915, the Workers’ Compensation Advisory Council (WCAC) legislation that included provisions on medical cost containment and dispute resolution.

However, two onerous auto repair bills never even got a committee hearing thanks reportedly to industry lobbyists.

One would have eliminated company direct repair programs by enacting “any willing provider” legislation; the other would have banned insurers from owing auto repair facilities.