There has been a lot of movement recently on issues impacting agents both in the legislative arena and also on the legal front. Read below for more about legislation to modernize Ohio’s insurance rebating laws, employer mandates passed by the Ohio House, and a case before the Ohio Supreme Court challenging caps on non-economic damages.
Insurance Anti-Rebating Modernization
On Nov. 17 language to modernize Ohio’s anti-rebating rules was added to Senate Bill 256. While this bill deals with travel insurance, a substitute bill was adopted that addresses additional areas of insurance including rebating. These changes to Ohio law have gained traction as the National Association of Insurance Commissioners (NAIC) is likely to adopt several changes to their Unfair Trade Practices Model Law to essentially modernize the anti-rebating rules.
Key changes in the legislation will allow insurers and agents to provide value-added products and services at no or reduced cost which are not specified in the insurance policy provided they are (1) related to the insurance coverage (2) are primarily designed to satisfy certain permitted purposes (mitigate loss, reduce claims, provide education about risk, etc. and (3) are reasonable in comparison with the insurance premium. The dollar threshold that would be allowed for meals, gifts, etc. for commercial clients would increase from $50 per year to no dollar amount specified but rather an amount that is “reasonable in comparison to the premium”. Commercial property and casualty will be completely exempted from rebating rules.
On the personal lines side, the amount will be determined by the superintendent per policy year per term or calendar year. The NAIC has suggested to allow the amount that can be spent on meals and items to the lesser of 5% of premium or a set amount of $250. This change will not be pursued via legislation, but rather likely as an update to the current bulletin in place that specifies the $50 yearly limit.
OIA CEO Jeff Smith testified in support of the bill on Tuesday. We are hopeful that S.B. 256 will be voted out of the Senate Insurance Committee soon and be put up for a vote by the full Senate. At that point, the bill will then need to work its way through the Ohio House to get to the governor’s desk for approval to become law.
On Nov. 18th the Ohio House passed legislation (House Bill 218) to limit vaccine mandates. The bill’s provisions, most of which sunset in September 2025, include:
- Prohibiting employers, schools, or institutions of higher education from requiring vaccines, drugs, or other products that use mRNA, DNA, or other genetic technology that has not been approved by the U.S. Food and Drug Administration;
- Providing exemptions for such mandates for medical contraindications, natural immunity, and reasons of personal conscience;
- Specifying that an injury from a mandated COVID vaccine is eligible for workers’ compensation unless the person receives compensation from national vaccine injury programs;
- A prohibition against requiring people to show proof of vaccination to enter facilities or receive services; and
- Extending civil immunity provisions of prior legislation (HB606, 133rd General Assembly) through June 30, 2023.
The measure would be superseded by any federal policy, such as those that have been proposed by the Occupational Safety and Health Administration for large employers and by the Centers for Medicare and Medicaid Services for health care providers. The OSHA rule has already been put on hold pending a federal court decision.
Business groups such as the Ohio Chamber of Commerce and the Ohio Alliance for Civil Justice, both of which OIA is a member of, are working to fight against legislation like this that crosses the line and interferes with the ability of employers to manage their workplaces how they see fit and to be free of undue interference from all levels of government.
The legislation began hearings in the Senate this week. It is unclear at this point if the bill has the votes to pass the Senate, and if it does if Gov. DeWine will sign it.
Supreme Court Challenge to Caps on Non-economic Damages
Earlier this year the Ohio Supreme Court voted 4-3 to accept a case that places a portion of Ohio’s 2005 tort reform overhaul in jeopardy. Notably, Justices Kennedy, Fischer, and DeWine dissented in the decision to accept the case. In Amanda Brandt v. Ray Pompa, et al., the court will decide whether the 2005 tort reform overhaul that caps a portion of non-economic damages as applied to minor victims of sexual abuse that suffer severe and permanent injuries violates constitutional rights to due process, equal protection, trial by jury and open courts.
While the court issued a decision in 2016 that upheld these caps, Brandt argues that her case is distinguishable from the 2016 lawsuit and noted that in its 2016 decision the court also wrote that “there may exist a set of facts under which application of the statutory damage caps would prove unconstitutional.” With only two of the seven justices that ruled in the 2016 case remaining on the Court, this latest challenge is being watched closely by many.
OIA is a member of the Ohio Alliance of Civil Justice and they filed an amicus brief on Nov. 24th in support of the appellee. Notably, Ohio’s Attorney General (Dave Yost) also filed an amicus brief in support of the appellee but in which he argues the policy is “foolish” but constitutional. The brief also notes he has called on the General Assembly to change the law.