109th CONGRESS
1st Session
H. R. 3639
To establish minimum standards relating to a factor for life insurance
eligibility and rates, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
July 29, 2005
Ms. WASSERMAN SCHULTZ (for herself, Ms. ROS-LEHTINEN, Mr. FRANK of Massachusetts,
Mr. BACHUS, Mr. WEXLER, Mr. CROWLEY, Mr. ISRAEL, Ms. BEAN, Mrs. LOWEY, Mr.
FILNER, Mr. MILLER of Florida, Ms. SCHAKOWSKY, Mr. FITZPATRICK of Pennsylvania,
Mr. CLEAVER, Ms. BERKLEY, Mr. BERMAN, Mr. WAXMAN, Mr. HASTINGS of Florida,
Mr. DAVIS of Alabama, Mrs. MALONEY, Mr. PRICE of Georgia, and Ms. HERSETH)
introduced the following bill; which was referred to the Committee on Financial
Services
A BILL
To establish minimum standards relating to a factor for life insurance
eligibility and rates, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the `Life Insurance Fairness for Travelers Act of
2005'.
SEC. 2. AMENDMENTS TO TRIA.
The Terrorism Risk Insurance Act of 2002 (Public Law 107-297; 116 Stat. 2322)
is amended by adding at the end the following new title:
`TITLE IV--FAIRNESS FOR LIFE INSURANCE PURCHASERS
`SEC. 401. CONGRESSIONAL FINDINGS AND PURPOSES.
`(a) Findings- The Congress finds that--
`(1) life insurance companies are increasingly using the future plans of
Americans to engage in lawful foreign travel as a reason to either deny
persons life insurance or to charge premiums that are not commensurate with
the risk of such travel; and
`(2) that such denials of insurance and disproportionate premiums may deter
Americans from purchasing insurance that they and their families may need.
`(b) Purpose- The purpose of this title is to establish uniform rules relating
to the use of foreign travel as a factor in setting life insurance eligibility
and rating.
`SEC. 402. PROHIBITION AGAINST DISCRIMINATION IN LIFE INSURANCE POLICIES
BASED ON FUTURE FOREIGN TRAVEL PLANS.
`(a) In General- It shall be unlawful for any insurer to deny any person life
insurance, or to otherwise discriminate in the issuance, cancellation, amount
of coverage, or conditions of life insurance, based upon the intent of such
person to engage in future lawful foreign travel.
`(b) Insurance Rates- It shall be unlawful for any insurer to charge rates
for life insurance which are excessive or unfairly discriminatory in relation
to the actuarial risk associated with future lawful foreign travel of such
person.
`SEC. 403. ADMINISTRATIVE ENFORCEMENT.
`(a) State Enforcement- In addition to such other remedies as are provided
under State law, the chief law enforcement officer of a State, or an official
or agency designated by a State, may bring an action to enjoin any person
who has violated or is violating this title.
`(b) Enforcement by the Secretary- The Secretary shall enforce this Act in
any State that the Secretary determines does not have a comparable State law
or a law that the Secretary has determined is not inconsistent under section
405.
`SEC. 404. EFFECT ON STATE LAWS.
`(a) In General- This title does not annul, alter, or affect, or exempt any
insurer subject to the provisions of this title from complying with the laws
of any State with respect to the use of prospective lawful foreign travel
for the purposes of underwriting or rating life insurance except to the extent
that such laws are inconsistent with any provision of this title and then
only to the extent of the inconsistency. The Secretary is authorized to determine
whether such inconsistencies exist. The Secretary may not determine that any
State law is inconsistent with any provision of this title if the Secretary
determines that such law gives greater protection to the insured.
`(b) State Exemptions- The Secretary shall, by regulation, exempt from the
requirements of this title any class of insurance transactions within any
State if the Secretary determines that under the law of that State that class
of transaction is subject to requirements substantially similar to those imposed
under this title or that such law gives greater protection to the consumer,
and that there is adequate provision for enforcement.
`SEC. 405. DEFINITIONS.
`In this title, the following definitions shall apply:
`(1) INSURER- The term `insurer' means any entity, including any affiliate
thereof, that is licensed or admitted to engage in the business of providing
life insurance in any State.
`(2) INSURED- The term `insured' means any natural person who purchases,
or attempts to purchase, life insurance.
`(A) IN GENERAL- The term `life insurance' means insurance for which the
probabilities of the duration of human life or the rate of mortality are
an element or condition of insurance.
`(B) INCLUDED INSURANCE- Such term includes the granting of--
`(ii) additional benefits in the event of death by accident or accidental
means;
`(iii) disability income benefits;
`(iv) additional disability benefits that operate to safeguard the contract
from lapse or to provide a special surrender value, or special benefit
in the event of total and permanent disability;
`(v) benefits that provide payment or reimbursement for long-term home
health care, or long-term care in a nursing home or other related facility;
`(vi) burial insurance; and
`(vii) optional modes of settlement of proceeds of life insurance.
`(C) EXCLUSIONS- Such term does not include property and casualty insurance,
health insurance or workers compensation insurance.
`(4) SECRETARY- The term `Secretary' means the Secretary of the Treasury.
`SEC. 406. REGULATIONS.
` The Secretary shall issue regulations to carry out the purposes of this
title.
`SEC. 407. APPLICABILITY.
`This title shall apply to any policy for life insurance coverage issued,
renewed, altered, or modified or canceled after the expiration of the 6-month
period beginning on the date of the enactment of the Life Insurance Fairness
for Travelers Act of 2005.'.
SEC. 3. TIMING OF REGULATIONS.
The Secretary of the Treasury shall issue the regulations required by section
406 of the Terrorism Risk Insurance Act of 2002, as added by section 2 of
this Act, not later than the expiration of the 6-month period beginning on
the date of the enactment of this Act.
SEC. 4. TECHNICAL AMENDMENT.
The table of contents in section 1(b) of the Terrorism Risk Insurance Act
of 2002 (15 U.S.C. 6701 note) is amended by adding at the end the following
new items:
`TITLE IV--FAIRNESS FOR LIFE INSURANCE PURCHASERS
`Sec. 401. Congressional findings and purposes.
`Sec. 402. Prohibition against discrimination in life insurance policies
based on future foreign travel plans.
`Sec. 403. Administrative enforcement.
`Sec. 404. Effect on State laws.
`Sec. 407. Applicability.'.
END
