HB 5993

HOUSE BILL NO. 5993
A bill to amend 1956 PA 218, entitled
"The insurance code of 1956,"
by amending section 1915 (MCL 500.1915), as amended by
2020 PA 62, and by adding section 1202a.
the people of the state of michigan enact:
Sec. 1202a. (1)
An insurance agency or producer may impose or pass along a fee for any insured
making payment by credit card, debit card, electronic funds transfer,
electronic check, or other electronic means to offset actual costs incurred by the
insurance producer for accepting and processing payments made by electronic
means subject to the following:
(a) Any fee
collected by an insurance agency or producer under this subsection must not
exceed the actual costs incurred by the insurance agency or producer. However,
an insurance producer may impose a fee instead of the actual cost of the
individual payment type that does not exceed the average of the actual cost
incurred for the various types of electronic payments for which the insurance
producer imposes a fee.
(b) An
insurance agency or producer charging, collecting, or passing through a fee
under this subsection shall notify the insured of the amount of the fee before
completing a transaction, provide an opportunity for the insured to cancel the
transaction without incurring a fee, and make available the option to make a
payment by check or money order without the imposition of a fee for a card
payment or electronic payment.
(c) If an
insured elects to make a payment to the insurance agency or producer by credit
card, debit card, electronic funds transfer, electronic check, or other
electronic means and a fee is imposed and collected under this subsection, the
payment of the fee must not be refundable.
(d) The fee
may be charged in addition to all other interest and fees allowed by law.
(e) An
insurance agency or producer shall not charge a fee on any debit card or
prepaid card transaction if the payment card network on which the transaction
is initiated or processed prohibits the fee by contract, rule, or policy.
(2) As used
in this section, "actual costs" means actual third-party costs
incurred or charged for the processing of payments made by electronic means. If
an insurance agency or producer is an affiliate of an entity that processes
payments made by electronic means, the payment processing affiliate is
considered a third party.
Sec. 1915. (1) A licensee may charge a fee
as follows:
(a) For a surplus lines insurance policy, a A fee in addition to a commission only if the fee is
not included in the premium and the fee is reasonable to cover underwriting and
other expenses that are unique to surplus lines .
(b) For a personal lines insurance policy, a fee not to exceed the greater of $100.00 or
10% of the personal lines insurance policy
premium.
(b) If the insured pays the premium with a credit card, the credit card
transaction fee.
(2) All of the
following apply to a fee charged under subsection (1):
(a) The fee must
not be excessive or discriminatory. The licensee shall maintain complete
documentation of all fees charged and evidence of the disclosure required under
subdivision (b).
(b) The fee must be
fully disclosed in detail to the insured, whether directly or through another
licensed insurance producer, in writing before the sale. The fee must be
separately itemized on any of the following:
(i) The policy declarations page.
(ii) The billing statement.
(iii) Other documentation provided to the
purchaser setting forth the cost of the policy.
(c) The fee must
not be included as a part of the policy premium in the computation of premium
taxes.