TITLE XXXVII
INSURANCE

Chapter 407-B
GROUP MARKETING OF MOTOR VEHICLE INSURANCE

Section 407-B:1

    407-B:1 Purpose. – The purpose of this chapter is to permit the writing of motor vehicle insurance in this state on a group merchandising basis subject to the conditions stated herein, to avoid the application of any statute forbidding discrimination between insureds as to the type of business defined herein and to set forth the terms and conditions under which insurance on a group merchandising basis may be written.

Source. 1969, 288:1, eff. Aug. 25, 1969.

Section 407-B:2

    407-B:2 Definitions. –
The following words, as used in this chapter, unless the context otherwise requires or a different meaning is specifically prescribed, shall have the following meanings:
I. Group Motor Vehicle Insurance Defined. All motor vehicle insurance which is offered by a licensed insurer in this state on a group merchandising plan to an eligible group as herein defined shall be deemed group motor vehicle insurance.
II. Group Merchandising Defined. The marketing of group motor vehicle insurance by a licensed insurer otherwise engaged in insuring independent individual risks, to an eligible group on a guaranteed basis under a single insurance program, without individual underwriting selection or individual proof of insurability, shall be deemed group merchandising. This method of marketing insurance is generally referred to as "mass merchandising," "franchise merchandising," or "collective merchandising"; but for purposes of this section shall hereinafter be only referred to as "group merchandising" or the "group plan" as herein defined.
III. Eligible Group Defined. Any group to be eligible for group merchandising shall have been in existence for more than 5 years prior to the purchase of such insurance, and shall not have been organized solely for the purpose of purchasing insurance. Such group shall have a high degree of homogeneity and may include members of unincorporated and corporated associations, labor unions, employees of a common employer and similar principal agent relationships. No group will be eligible unless it consists of 500 or more members with at least 75 percent participation in the group plan. Where the group has national or other affiliates, only the members located in the state of New Hampshire shall be considered in determining the number and percentage of individuals necessary for establishing group eligibility.
IV. Eligible Members Defined. Eligible members shall include all members in good standing in the group provided employees shall be engaged in at least 24 hours employment per week, except as otherwise provided in RSA 407-B:4. Officers and directors of an eligible group and individual proprietors and partners shall be eligible for a group plan and as such may be considered as employees.

Source. 1969, 288:1, eff. Aug. 25, 1969.

Section 407-B:3

    407-B:3 General Conditions. –
Group motor vehicle insurance may be issued in this state provided the following conditions are complied with:
I. Mandatory participation in the group plan shall not be required as a condition of employment, nor shall any member not participating in the plan be coerced or discriminated against.
II. The insurer and the group insured must accept all members or employees who are eligible and wish to participate in the plan.
III. Such a group plan shall include a provision that any member of the group shall have the right to convert his group policy to an individual standard policy of insurance in the same company as offered by the insurer to the non-group insureds upon termination of his connection with the group extending to him the same limits of coverage.
IV. To qualify to write the group insurance herein defined, an insurer must also be engaged in the business of writing the type of coverage offered for insureds other than group and may not be organized solely for the purpose of furnishing coverage to such groups.
V. Each member of the group must be issued the same form of policy as approved for issue in this state varying only as to the amounts of insurance and limits of liability.
VI. Insurance must be provided by individual policies to each member of the group under an agreement whereby the premiums on such policies shall be paid to the insurer periodically by the group with or without payroll deductions.
VII. An insurer may not cancel the insurance of an individual member of the group except for the non-payment of premium by such member or unless the insurance for the entire group is cancelled. In such cases notice of cancellation as provided in like non-group policies shall be given to each member.
VIII. The plan shall provide that only those motor vehicles owned by members of the group or their spouses or children, jointly or severally, shall be eligible for coverage.
IX. All individuals considered "Eligible Members" as defined herein shall be provided with this motor vehicle group insurance plan if they wish it, provided one family member holds a valid license to operate a motor vehicle.

Source. 1969, 288:1, eff. Aug. 25, 1969.

Section 407-B:4

    407-B:4 Maintenance of Records. – Every insurer writing insurance under this group merchandising plan shall keep and maintain separate experience data on this type of business including complete records of premium income, losses and expense so that the experience of each group may be fairly ascertained.

Source. 1969, 288:1, eff. Aug. 25, 1969.

Section 407-B:5

    407-B:5 Rates. – Rates for this type of business shall be adequate but not excessive or unfairly discriminatory and shall be filed pursuant to the provisions of RSA 412 insofar as consistent with the provisions of this chapter.

Source. 1969, 288:1. 2003, 150:6, eff. Jan. 1, 2004.

Section 407-B:6

    407-B:6 Experience Rating. – No experience rating shall be applied to an individual group until after 3 years of operation and at that time shall be based on the experience of the preceding 3 calendar years. Thereafter, any experience rating shall be made annually using the last 3 calendar years. In case of merger of 2 or more companies, the 3-year minimum will apply to the oldest company in the newly-formed entity, not the new entity formed by the merger itself.

Source. 1969, 288:1, eff. Aug. 25, 1969.

Section 407-B:7

    407-B:7 Other Group Plans. – The provisions of this chapter shall not apply to any group plans of group life insurance or group accident and sickness insurance but any existing plan of group motor vehicle insurance now in effect shall conform to the provisions of this chapter.

Source. 1969, 288:1, eff. Aug. 25, 1969.