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A70, R105, H3488
Sponsors: Reps. Sandifer and Hixon
Document Path: l:\council\bills\nbd\11073cz17.docx
Introduced in the House on January 17, 2017
Introduced in the Senate on January 31, 2017
Last Amended on May 9, 2017
Passed by the General Assembly on May 10, 2017
Governor's Action: May 19, 2017, Signed
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number ------------------------------------------------------------------------------- 1/17/2017 House Introduced and read first time (House Journal-page 13) 1/17/2017 House Referred to Committee on Labor, Commerce and Industry (House Journal-page 13) 1/25/2017 House Committee report: Favorable with amendment Labor, Commerce and Industry (House Journal-page 2) 1/26/2017 House Amended (House Journal-page 10) 1/26/2017 House Read second time (House Journal-page 10) 1/26/2017 House Roll call Yeas-99 Nays-0 (House Journal-page 12) 1/26/2017 House Unanimous consent for third reading on next legislative day (House Journal-page 13) 1/27/2017 House Read third time and sent to Senate (House Journal-page 1) 1/31/2017 Senate Introduced and read first time (Senate Journal-page 21) 1/31/2017 Senate Referred to Committee on Banking and Insurance (Senate Journal-page 21) 2/23/2017 Senate Committee report: Favorable Banking and Insurance (Senate Journal-page 19) 3/7/2017 Senate Read second time (Senate Journal-page 27) 3/7/2017 Senate Roll call Ayes-39 Nays-2 (Senate Journal-page 27) 5/9/2017 Senate Amended (Senate Journal-page 60) 5/10/2017 Scrivener's error corrected 5/10/2017 Senate Read third time and returned to House with amendments (Senate Journal-page 29) 5/10/2017 House Concurred in Senate amendment and enrolled (House Journal-page 85) 5/10/2017 House Roll call Yeas-98 Nays-0 (House Journal-page 86) 5/15/2017 Ratified R 105 5/19/2017 Signed By Governor 5/26/2017 Effective date 5/19/17 5/31/2017 Act No. 70
View the latest legislative information at the website
VERSIONS OF THIS BILL
(A70, R105, H3488)
AN ACT TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING ARTICLE 7 TO CHAPTER 55, TITLE 38 SO AS TO ALLOW AN INSURER TO DELIVER, STORE, OR PRESENT EVIDENCE OF INSURANCE COVERAGE BY ELECTRONIC MEANS, TO ESTABLISH CERTAIN CONDITIONS THAT MUST BE MET BEFORE A NOTICE OR DOCUMENT MAY BE DELIVERED BY ELECTRONIC MEANS, TO REQUIRE THE INSURER TO DELIVER A HARDCOPY NOTICE OF CANCELLATION, NONRENEWAL, OR TERMINATION BY FIRST-CLASS MAIL IF THE INSURER KNOWS THE DOCUMENTS WERE NOT RECEIVED BY THE INSURED WHEN DELIVERED BY ELECTRONIC MEANS, TO REQUIRE THE PARTY TO VERIFY OR ACKNOWLEDGE RECEIPT OF THE ELECTRONICALLY DELIVERED NOTICE OR DOCUMENT IN CERTAIN CIRCUMSTANCES, TO PROVIDE THAT A WITHDRAWAL OF CONSENT DOES NOT AFFECT THE LEGAL EFFECTIVENESS, VALIDITY, OR ENFORCEABILITY OF THE NOTICE OR DOCUMENT, TO REQUIRE AN INSURER TO NOTIFY THE PARTY OF CERTAIN PRIVILEGES BEFORE SENDING ADDITIONAL NOTICES OR DOCUMENTS SUBJECT TO CONSENT TO RECEIVE CERTAIN NOTICES OR DOCUMENTS, TO ALLOW FOR A PARTY TO ELECTRONICALLY SIGN ELECTRONICALLY DELIVERED DOCUMENTS, TO REQUIRE THE INSURER TO RETAIN RECORDS, AND TO AUTHORIZE THE DIRECTOR TO PROMULGATE REGULATIONS TO IMPLEMENT THE PROVISIONS OF THIS SECTION.
Be it enacted by the General Assembly of the State of South Carolina:
Evidence of insurance, electronic documents authorized
SECTION 1. Chapter 55, Title 38 of the 1976 Code is amended by adding:
Section 38-55-710. As used in this article:
(1) 'Delivered by electronic means' includes:
(a) delivery to an electronic mail address at which a party has consented to receive notices or documents; or
(b) placement on an electronic network or site accessible by means of the Internet, mobile application, computer, mobile device, tablet, or another electronic device, together with separate written notice of the placement that must be provided by electronic mail to the address at which the party has consented to receive notice or by another delivery method that has been consented to by the party.
(2) 'Party' means a recipient of a notice or document required as part of an insurance transaction, including, but not limited to, an applicant, an insured, a policyholder, or an annuity contract holder.
Section 38-55-720. (A) Subject to the provisions of subsection (C), notice to a party of another document required under applicable law in an insurance transaction or that is to serve as evidence of insurance coverage may be delivered, stored, and presented by electronic means if it meets the requirements of Chapter 6, Title 26, the South Carolina Uniform Electronic Transactions Act.
(B) Delivery of a notice or document pursuant to this section must be considered equivalent to the following delivery methods:
(1) first-class mail; and
(2) first-class mail, postage prepaid.
(C)(1) A notice or document may be delivered by electronic means by an insurer to a party if:
(a) the party has affirmatively consented to the method of delivery and has not withdrawn consent;
(b) the party, before giving consent, is provided with a clear and conspicuous statement informing the party of:
(i) the right or option of the party to have the notice or document provided or made available in paper or another non-electronic form at no additional cost;
(ii) the right of the party at any time to withdraw his consent to have a notice or document delivered by electronic means;
(iii) the specific notice or document or categories of notices or documents that may be delivered by electronic means during the course of the relationship between the insurer and the party;
(iv) the means, after consent is given, by which a party may obtain a paper copy of a notice or document delivered by electronic means at no additional cost; and
(v) the procedure a party must follow to withdraw consent to have a notice or document delivered by electronic means and to update information needed to contact the party electronically;
(c) the transmission or delivery method used for the electronic notice includes conspicuous language concerning its subject or purpose;
(d) the party:
(i) before giving consent, is provided with a statement of the hardware and software requirements for access to and retention of a notice or document delivered by electronic means; and
(ii) consents electronically, or confirms consent electronically, in a manner that reasonably demonstrates that the party can access information in the electronic form that will be used for notices or documents delivered by electronic means for which the party has given consent; and
(e) after consent of the party is given, if a change occurs in the hardware or software requirements needed to access or retain a notice or document delivered by electronic means that creates a material risk that the party will not be able to access or retain a subsequent notice or document to which the consent applies, then the insurer shall:
(i) provide the party with a statement of the revised hardware and software requirements for access to and retention of a notice or document delivered by electronic means; and
(ii) comply with the requirements of subsection (A).
(2) No insurer may cancel, refuse to issue, or refuse to renew a policy because the applicant or insured refuses to agree to receive mailings electronically pursuant to this subsection.
(D) A hardcopy of a notice of cancellation, notice of non-renewal, or notice of termination must be delivered by first-class mail, postage prepaid, to the last known mailing address of a party if the insurer knows that the notice of cancellation, notice of non-renewal, or notice of termination sent by electronic means was not received by the party. For the purposes of this subsection, the determination of whether an insurer sends, or a party receives, a notice of cancellation, notice of non-renewal, or notice of termination shall be governed by Section 26-6-150.
(E) This section does not affect requirements related to content or timing of any notice or document required under applicable law.
(F) If a provision of this title or other applicable law requiring a notice or document to be provided to a party expressly requires verification or acknowledgment of receipt of the notice or document, then the notice or document may be delivered by electronic means only if the method used provides for verification or acknowledgment of receipt.
(G) The legal effectiveness, validity, or enforceability of the underlying contract or policy of insurance executed by a party may not be denied solely because of the failure to obtain electronic consent or confirmation of consent of the party pursuant to subsection (C)(1)(d)(ii).
(H) A withdrawal of consent by a party:
(1) does not affect the legal effectiveness, validity, or enforceability of a notice or document delivered by electronic means to the party before the withdrawal of consent is effective; and
(2) is effective four business days after receipt of the withdrawal by the insurer.
(I) Failure by an insurer to comply with subsection (C)(1)(e) may be treated, at the election of the party, as a withdrawal of consent for purposes of this section.
(J) This section does not apply to a notice or document delivered by an insurer in an electronic form before the effective date of this section to a party who, before that date, had consented to receive notice or document in an electronic form otherwise allowed by law.
(K) If the consent of a party to receive certain notices or documents in an electronic form is on file with an insurer before the effective date of this section and if, pursuant to this section, an insurer intends to deliver additional notices or documents to the party in an electronic form, then, prior to delivering such additional notices or documents electronically, the insurer shall notify the party of:
(1) the notices or documents that may be delivered by electronic means under this section that were not previously delivered electronically; and
(2) the party's right to withdraw at any time consent to have notices or documents delivered by electronic means.
(L) If a provision of this title or applicable law requires a signature, notice, or document to be notarized, acknowledged, verified, or made under oath, then the requirement is satisfied if the electronic signature of the person authorized to perform those acts, together with all other information required to be included by the provision, is attached to or logically associated with the signature, notice, or document.
(M) This section may not be construed to modify, limit, or supersede the provisions of the federal Electronic Signatures in Global and National Commerce Act, Public Law 106-229, as amended. It is intended to provide an insurer additional options for the delivery of electronic notices and documents. An insurer choosing to use procedures outlined in ESIGN, UETA, or other applicable law or regulation governing such notice or documents must be considered to be in compliance with this section.
(N) An insurer delivering a notice or document by electronic means shall take appropriate and necessary measures reasonably calculated to ensure that the system for furnishing the notices of documents is secure and protects the confidentiality of information as defined by applicable law. An insurer who is in compliance with the Health Insurance Portability and Accountability Act, 45 C.F.R. 164.512(b), or the Gramm Leach Bliley Act, 16 C.F.R. 314.1, must be considered to be in compliance with this section.
(O) An insurer delivering a notice or other document pursuant to this article shall retain records in the manner provided in Sections 26-6-120, 38-13-120, 38-13-140, and 38-13-160.
(P) The director or his designee may promulgate, by bulletin, regulation, or order the requirements necessary to implement the provisions of this section."
SECTION 2. This act takes effect on January 1, 2018.
Ratified the 15th day of May, 2017.
Approved the 19th day of May, 2017.
This web page was last updated on June 21, 2017 at 3:56 PM