HB-5430, As Passed House, June 5, 2018

HB-5430, As Passed Senate, June 5, 2018

SUBSTITUTE FOR

HOUSE BILL NO. 5430

A bill to amend 1956 PA 218, entitled

"The insurance code of 1956,"

(MCL 500.100 to 500.8302) by adding section 2266.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 2266. (1) Subject to the requirements of this section, a

notice to a party or any other document that is required in an

insurance transaction or that is to serve as evidence of insurance

coverage may be delivered, stored, and presented by electronic

means if it meets both of the following:

(a) The requirements of the uniform electronic transactions

act, 2000 PA 305, MCL 450.831 to 450.849.

(b) For a health insurer, the requirements of section

2236(9)(a)(ii).

(2) Electronic delivery of a notice or document as provided in

this section is equivalent to any delivery method otherwise

required by law, including delivery by first-class mail, first-

class mail postage prepaid, certified mail, or certificate of

mailing.

(3) If an insurer has reason to believe that a party is not

receiving notices or documents that the insurer attempts to deliver

by electronic means, including if the insurer attempts delivery by

electronic means and receives a notice that the delivery by

electronic means has failed, the insurer shall deliver the notices

or documents by first-class mail or by any other delivery method

required for the notices or documents.

(4) An insurer may use electronic delivery of a notice or a

document to a party under this section if the insurer meets the

requirements of subsection (5) and if all of the following

requirements are met:

(a) The party has affirmatively consented to the electronic

delivery method and has not withdrawn consent.

(b) Before obtaining consent, the insurer provides the party

with a clear and conspicuous statement informing the party of all

of the following:

(i) The right of the party at any time to have the notice or

the document provided or made available in paper form or by another

nonelectronic form.

(ii) The right of the party at any time to withdraw consent to

have a notice or document delivered by electronic means and any

conditions or consequences imposed if consent is withdrawn.

(iii) The specific notice or document or categories of notices

or documents that may be delivered by electronic means during the

course of the relationship between the insurer and the party.

(iv) The means, after consent is given, by which the party may

obtain a paper copy of a notice or document delivered by electronic

means.

(v) The procedures for the party to follow to update

information needed to contact the party electronically and to

withdraw consent to have a notice or a document delivered by

electronic means.

with a statement of the hardware and software requirements for

access to and retention of a notice or document delivered by

electronic means. The party shall provide electronic consent to the

hardware and software requirements or confirm consent

electronically in a manner that reasonably demonstrates that the

party can access information in the electronic form that will be

used for notices or documents delivered by electronic means.

(5) After the party consents as provided in subsection (4), if

a change occurs in hardware or software needed to access or retain

a notice or document delivered by electronic means that creates a

material risk that the party will not be able to access or retain a

notice or document to which consent applies, the insurer shall

provide the party with a statement that includes all of the

following:

(a) Information regarding the revised hardware or software

requirements for access to and retention of a notice or document

delivered by electronic means.

(b) A description of the right of the party to withdraw

consent without the imposition of any condition or consequence that

was not disclosed under subsection (4)(b)(ii).

(6) Withdrawal of consent to electronic delivery does not

affect the legal effectiveness, validity, or enforceability of a

notice or a document that is delivered by electronic means to a

party before the withdrawal of consent is effective.

(7) Except as otherwise provided in this subsection,

withdrawal of consent by a party becomes effective 30 days after

the insurer receives notice of the withdrawal. Consent is

automatically withdrawn if the insurer learns that the electronic

delivery method currently used is no longer an effective delivery

mechanism.

(8) Failure by an insurer to comply with subsection (5) may be

treated, at the election of the party, as a withdrawal of consent.

(9) This section must not be construed to modify, limit, or

supersede the federal electronic signatures in global national

commerce act, 15 USC 7001 to 7031.

(10) An insurance producer is not subject to civil liability

for any harm or injury to a party that occurs as a result of either

of the following:

(a) The party's consent under subsection (4) to receive a

notice or a document delivered by electronic means under this

section.

(b) An insurer's failure to deliver a notice or document by

electronic means unless the insurance producer causes the harm or

injury.

(11) As used in this section:

(a) "Delivered by electronic means", "delivery by electronic

means", or "electronic delivery" mean delivery by either of the

following methods:

(i) Delivery to an electronic mail address at which a party

has consented to receive notices or documents.

(ii) Both of the following:

(A) Posting on an electronic network or site accessible by the

internet through use of a mobile application, computer, mobile

device, tablet, or any other electronic device.

(B) Sending separate notice of the posting described in sub-

subparagraph (A) to the electronic mail address at which the party

consented to receive notice of the posting or using any other

delivery method to which the party has consented.

(b) "Party" means a recipient of a notice or document required

as part of an insurance transaction and includes an applicant,

insured, policy holder, or annuity contract holder.