Help Me With Sign New Jersey Banking Presentation

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we're ready to the next edition or the latest edition of the break and this is PA is a video series that will break down the pressing topic and insurance and hopefully do it in about 10 to 15 minutes today we are going to be discussing the recent New Jersey executive order executive order 1 2 3 which provides a grace period for certain insurance to pay their premiums and prevents the cancellation of certain policies for that I am Brad latch at the director of government affairs for P I North East this is Claire urban she's going to be the one walking us through this latest executive order clearance day hi hi everyone thanks for joining us and Claire why don't you take it mirror okay terrific so as Brad said this is a quick overview of the executive order one two three which is not as simple as the name might imply the title may imply well discover quickly who it applies to what it means specifically for insurance producers and how it differs from similar executive orders in other states particularly New York and Connecticut so it's dive right in executive order number one two three grants a gross period for non-payment of premium for non-payment of premiums on insurance policies in the state of New Jersey the grace period is 90 days for PNC and premium financing arrangements and life insurance at 60 days for health and dental so this means during that time those policies cannot be cancelled for non-payment of premium i Mickey while this was signed about a week into April it is retroactive back to April 1st and allows the premiums to be paid at later dates so it's not given forgiving people's premium payments or giving them free insurance it's just saying it's due to everything going on with the covenant team pandemic if you can't currently pay your premium you can pay it in the future I also requires adjustments to direct billing methods for producers we'll get into that will stop get into all of these in more detail starting with property and casualty insurance so as I said the executive order requires insurers to grant a 90 day grace period for insurance who are facing it seemed related financial hardship we've been taking that assumption of your facing financial hardship in april/may even back in the last week's of March 2020 that would be coping 19 related due to everything happened to the cognate moment on the insured may apply up to apply the emergency grace period starting today April 1st or before looking on starting at May 1st so they paid their premium on April 8th if they can apply it on May 1st and get an extra still get the full 90 days this grace period prevents insurers from cancelling a policy for non-payment of premium during the grace period it doesn't require the renewal just that the policy cannot be cancelled or non renewed there are a couple questions there we have them - we'll talk about those later but effectively if they miss a premium payment the policy stands on the current terms additionally the insurer must waive all late fees and cannot report in the missed payment to the credit rating agency so it can affect people's credit score premiums then can be repaid over the remainder of the current policy torrent term or up to 12 months whichever is longer so it's a three year policy that certain inch one January 2020 they get almost three years to repay notification must be given to each policyholder by the insurer insurance carrier not producer life insurers or it's fairly similar it's another 90 degrees periods where the policy cannot be cancelled for non-payment premium it's the same where there can't be a late fee there can't be it cannot be reported to the credit rating agencies the premiums are do then do over 12-month period in 12 installments so unlike the PNC it's um PMC which allows over the life the policy life insurance is just over the next 12 months and again insurance carriers must provide notice to each policy holder then premium finance arrangements also given I need a grace period similar it goes can be are there a backward-looking to April 1st 2020 or forward-looking May 1st 20 same list it can't be reported to credit agencies there can't be like these it allows for the repayment of the premium for the current policy term or up to 12 months and 12 equal payments late payments cannot also cannot be considered in any future premium calculations so it can't missing a payment in Ming in June 2020 can't be considered for 2022 Premium financing arrangement it's just treated as if they paid out their worker at the payment date for each each missed payment again notice must be given to policyholders it so that was a lot of information so we're gonna do kind of backtrack a little to look at more the specific questions starting with who qualifies for the grace period and again its policyholders experiencing financial hardship as a result of the coab in nineteen pandemic it includes individuals and businesses and group policyholders and businesses with group insurance they have for health and dental that's only 60 days but it's still a grace period for non-payment due to Cove in nineteen related issues policy will for certain policies at least the life insurance policies they must have been in good standing on March 1st 2020 but that doesn't apply to PNC insurance policies or policyholders so then the timeframe to kind of break that down again is pretty much it started April 1st so policyholder who miss a payment in early April even before the executive order was signed would still qualify for the grace period 90 day grace period and that what if it started April 1st would run through the end of June and if they opted to instead apply it for the future policies starting May 1st it would run through a pop in July those are estimations for the 90 days or about three months and again it's not forgiveness it's not giving people free insurance it's simply saying it cannot be cancelled during the current pandemic policyholders will have time to repay the premiums for this for the grace period as I the remainder of the policy period or twelve equal installments over 12 months for life insurance that I said has to be the twelve months for the others it's whichever is longer so I per can spread out the payments payments fairly equally over the duration over the repayment period and they can't be charged late fees for these missed payments or have it affect their credit score again the insurers role in this is that they're the ones administering the grace period and must therefore notify the policyholders there's not a specific timeframe for how they should notify policyholders but it's that time that's their obligation it's not an issue the insurance producers responsibility but doesn't mean the insurance producer isn't involved in the communication of it just that they don't have a requirement from new to the state of New Jersey which brings us to what is the producers role the producers may are probably going to have a lot of questions about it so it's good to know about what's going on and what their carriers are doing about it such as providing notice and how they're administering the grace periods the producer is also in part of executive order one two three we're given the requirement that they must ensure all direct billing can be done remotely that means any any policy where the insurance producer collects the payment directly from the insured they must make sure the policyholder can pay are there online or through the mail so some policies require people may be paying for cash and show up at your office and hand you cash for that it's up now up to the insurance producers to find a way to accept those payments without the person without the policyholder going into your office there are limitations to the executive order again it's not a waiver it's not forgiveness period it's not even requiring that the in policy holder have been in bitstamp the policy hold the policy get renewed so that's set to expire in mid-may it doesn't have to be renewed it just can't be cancelled for non-payment of premium the policy letters in good standing applies for life insurance policies so if they miss a payment a life insurance payment on March 10th they would have been in good standing but they missed a payment in February then they wouldn't have been in good standing and don't qualify for scared for a life insurance policy and it only applies to the cancellation or non-renewal attributed to the failure to pay premium it doesn't extend to it doesn't say all policies set to expire in or in April and May 2020 have to be extended it's just for this very specific issue of marking the premium and other states I'm sure you've heard have had similar requirements New York requires producers to action to actively notify their policyholders of the grace period in addition to requiring insurers also notified notify policyholders it's there's a New York's is more limited in what lines of insurance applies to and it's automatically a 12 months repayment period one possible for the carrier we may entire video on the New York grace period which is about 60 days for the grace period itself the video is about 20 minutes I'd recommend watching that if you have New York policies similarly Connecticut's a lot more straightforward but made a video on that - its 60-day grace period on all policies issued by entities regulated by the Connecticut insurance departments so it's good to know which which state because they each have their own intricacies and with that I will just put the question screen for a minute if you have any questions please notify myself Brad or the PIO Resource Center um we are happy to help you there's a lot of questions that I'll say that haven't we don't even know the answers to but we are asking Dobey and actively trying to get responses so just because we can't get you a question this afternoon doesn't mean we can't we won't try to get one so we have a lot of questions as from this as well so and we will get into the nerdy part and start discussing those great Thank You Claire so you mentioned us still having a lot of questions and you absolutely right so we talked about you talked about the executive order one two three but there was also guidance from Doby department bank insurance they put three bulletins when life insurance one on P&C and one on premium finance that's elaborate on the executive order the executive orders about nine pages only like two paragraphs are actually the order of plans and cancellations so we could get a little bit more information from Dobie and that's where a lot of the information you have that you presented was came from although there are still a lot of questions so I do have a couple questions maybe you can find some clarification to me Claire if you don't mind so the executive order and the bulletins do or does it apply to ENS policies excess and surplus lines they don't they don't apply to ENS policies and part because ENS carriers aren't regulated by Dobie at least not nearly in the same way that admitted carriers are that's the risk of going into the NS market for ENS market is that they don't the state doesn't have as much authority to govern to regulate them just clarify so this is one of the questions that we've reached out to Tobias to get definitive word on similar to New York where ENS is not including these commercial lines New Jersey law excludes ENS commercial policies from their cancellation laws so we're thinking FPAA is that the governor and Dobey lack the legal authority to regulate those entities so they wouldn't be able to we are making sure we're confirming that but that is our basic sense given basically just how laws work legal authorities yeah it's situations like this or opportunity where people learn but what you can and cannot do in a crisis using their own wording to try to create big of a test possible for these but still still protecting themselves against constitutional challenges so kind of springboarding at that point on we mentioned are you mentioned pal sailors that are experienced in financial hardship I know when New York policy lers were required to or could be required to submit some sort of written attestation of financial hardship I don't think I noticed anything in the bulletin that requires that I think that might be another open question what do you think yeah I mean I think it's an open question it might be might be something that the companies could require even if it's not mandated by the State it might not connect and I know requires not today but the companies though can also accept a statement just say hey I basically saying I'm facing code 19 really financial hardship and I need this grace period so there's not a lot Sara T that on that it's probably until that there's clarity up to the companies and another point you brought up is policies can actually be canceled for other reasons besides I'm pay which I think is that is inching is you look at this grace period all right well this policy safe for ninety days and that's necessarily true the grace period does apply to renewal premiums but that doesn't mean that a carrier can cancel that policy for something else to your plan it's a really good point to bring up because well this does stem a lot of me non-payment issues it does not address another other issues for cancellation that carrier might be able to use illegally yes there's a lot of reasons carriers can legally cancel a policy particularly when it's up for renewal they have to give a reasoned as long as it's not discriminatory it's considered it's typically concerned valid and as far as producer requirements go you mentioned that the producers an under no requirements to find notification but there is a requirement to set up alternative payment would you go into that just a little bit more detail yeah so the main thing is that some policies some policies particularly I think it's the once one of they like assigned auto policies I don't sell insurance in New Jersey so I have never had to deal with direct billing myself but I do know from members that there are policies that require payment in cash or where people typically pay for it in cash to their personal financial situation and so with offices mean close to public and the government highly encouraging people to remain socially just thing and not go into offices for to pay a policy in cash they're having set up alternate you have to set an alternative method I'm recognizing though that if someone's paying in cash they probably their options alternative options are fairly limited something like putting an envelope in the mail putting an envelope in the mail or even probably an envelope in a mailbox or outside your office would probably be sufficient because they're not going into inside the actual office the main point is so that they can pay without getting going into your workspace it's a really good points The Bulletin mentions online payments but I don't think that's supposed to be the exclusive method that producers are supposed to set up as long as there's an awesome method to your point get mailing a check or a money order or something that effect yeah it's just working it out and that's also where producers don't have a specific role given to them by Dobby in this and the way that DFS did for New York in New York but there is a lot of room where you should producers are probably going to find themselves working with companies and on their specific what their specific policy holders needs in order to make sure their insurance stays in place well the state has effectively shut down as much as possible right that's why it could get any last words before we close up this segment no I just thanks for watching the video we are still trying to get answers to a lot of questions that we had and members have already asked us so I would keep checking what work P is public ations and website and the links below this video for further information great Thank You Claire I appreciate the time and thank you everybody for joining us