02/01/2012 09:00 AM Senate FINANCE

SENATE BILL NO. 115                                                                                                           
                                                                                                                                
     "An  Act defining  portable  electronics insurance  and                                                                    
     authorizing  the  director  of  insurance  to  issue  a                                                                    
     limited  producer  license  to   a  person  that  sells                                                                    
     portable electronics insurance."                                                                                           
                                                                                                                                
10:41:12 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:43:27 AM                                                                                                                   
RECONVENED                                                                                                                      
                                                                                                                                
10:43:32 AM                                                                                                                   
                                                                                                                                
Senator Egan explained SB 115. He referred to the Sponsor                                                                       
Statement (copy on file):                                                                                                       
                                                                                                                                
     As  cell phones,  tablet computers  and other  portable                                                                    
     electronic devices proliferate  and become necessary to                                                                    
     commerce  and  communication,  insurers have  begun  to                                                                    
     create products  to cover the  loss or damage  of these                                                                    
     valuable  and   important  possessions.   Because  most                                                                    
     electronic devices  are sold through retailers  who are                                                                    
     not usually in the insurance business, and because most                                                                    
     portable  electronics  insurance   is  sold  where  the                                                                    
     devices  are   purchases,  without   regulation  wildly                                                                    
     divergent  standards  have  evolved under  which  these                                                                    
     policies are sold. There is at present a chaotic market                                                                    
     for such insurance.                                                                                                        
                                                                                                                                
     Under these circumstances,  the possibility exists that                                                                    
     less  well capitalized,  or less  scrupulous, companies                                                                    
     may not survive in the marketplace or otherwise may not                                                                    
     be  able to  make  good on  their promises.  Similarly,                                                                    
     sales  personnel  working  for  vendors  of  electronic                                                                    
     devices may  not understand these products  well enough                                                                    
     to explain  them to  customers, and  they may  well not                                                                    
     understand the  disclosure laws under which  sellers of                                                                    
     insurance must operate, leaving consumers vulnerable to                                                                    
     liabilities they do not fully comprehend.                                                                                  
                                                                                                                                
     To  guard   against  the  excesses  of   a  marketplace                                                                    
     frontier,  reputable  companies  seek  regulation  that                                                                    
     protects both  the customer  and the reputation  of the                                                                    
     products being  marketed. SB 116 seeks  to provide both                                                                    
     sellers and  buyers the confidence to  enter the market                                                                    
     for  portable  electronics insurance--buyers  that  the                                                                    
     product  will  be   both  appropriate  and  dependable,                                                                    
     sellers that their products  will be trusted and sought                                                                    
     after.                                                                                                                     
                                                                                                                                
Senator  Olson   wondered  if   other  states   had  similar                                                                    
legislation Senator Egan replied yes.                                                                                           
                                                                                                                                
Co-Chair  Stedman  noted  the  one  zero  fiscal  note  from                                                                    
Department of Commerce, Community and Economic Development.                                                                     
                                                                                                                                
STEPHEN  MCDANIEL,  ASURION, FLORIDA  (via  teleconference),                                                                    
testified  in  support of  SB  115.  He explained  that  the                                                                    
legislation would protect consumers.                                                                                            
                                                                                                                                
10:46:39 AM                                                                                                                   
                                                                                                                                
LINDA  HALL,  DIRECTOR,  DIVISION OF  INSURANCE,  introduced                                                                    
herself.                                                                                                                        
                                                                                                                                
Co-Chair  Stedman  requested  the  thoughts,  concerns,  and                                                                    
perspective of  the Division of Insurance.  Ms. Hall replied                                                                    
that the division did not  introduce the bill. She explained                                                                    
that the division  had agreed to license the  vendor to have                                                                    
the  limited producer  license, and  the employees  would be                                                                    
able  to  sell and  train.  She  explained that  there  were                                                                    
requirements of the  vendor to keep a list  of the employees                                                                    
that were selling the insurance.                                                                                                
                                                                                                                                
10:49:00 AM                                                                                                                   
                                                                                                                                
Senator  McGuire   wondered  who   was  excluded   from  the                                                                    
marketplace.  Ms. Hall  felt that  the bill  would not  be a                                                                    
barrier to  entry. She stated  that it would  streamline the                                                                    
process for anyone  who wanted to sell a  product that would                                                                    
directly impact consumers.                                                                                                      
                                                                                                                                
Senator Egan thanked the committee.                                                                                             
                                                                                                                                
                                                                                                                                
SB  115  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
Co-Chair Stedman explained the following day's agenda.