Senate Bill No. 393-Senator Regan

May 14, 1997
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Referred to Committee on Commerce and Labor

SUMMARY--Revises provisions governing insurance and insurance fraud. (BDR 57-837)

FISCAL NOTE: Effect on Local Government: No.
Effect on the State or on Industrial Insurance: Yes.

EXPLANATION - Matter in italics is new; matter in brackets [ ] is material to be omitted.

AN ACT relating to insurance; providing immunity from civil liability in certain circumstances to persons who provide information concerning acts of insurance fraud; requiring reporting of the conviction of a person for insurance fraud to certain licensing agencies of this state; requiring such an agency to report to the legislature concerning action taken by the agency against the convicted person; prohibiting certain acts relating to insurance fraud; making various changes concerning collateral benefits paid or payable to a plaintiff in certain civil actions; providing penalties; and providing other matters properly relating thereto.

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

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Section 1 Chapter 686A of NRS is hereby amended by adding thereto the provisions set forth as sections 2 and 3 of this act.
Sec. 2 1. A person who, in the absence of malice, provides or otherwise furnishes information concerning an act or a suspected act of insurance fraud prohibited by NRS 686A.291, is not liable in a civil action if the information is provided to or received from:
(a) The commissioner, or his employees, agents or representatives;
(b) A person from a federal, state or local law enforcement agency or other agency that regulates insurance, or an authorized employee, agent or representative of such a person;
(c) An organization that is involved in the prevention and detection of acts of insurance fraud, or the employees, agents or representatives of such an organization;
(d) The National Association of Insurance Commissioners, or its employees, agents or representatives; or
(e) An insurer or authorized representative of an insurer.
2. In a civil action brought against a person for making a report or otherwise furnishing information concerning an act or a suspected act of insurance fraud, the plaintiff must plead specifically that the person against whom the civil action is filed is not immune from civil liability pursuant to this section because the person made the report or otherwise furnished the information with actual malice.
3. The provisions of this section do not abrogate or modify any common law or statutory privilege or immunity that otherwise applies to a person who provides or otherwise furnishes information concerning an act or a suspected act of insurance fraud.
Sec. 3 If a person who is licensed or registered under the laws of the State of Nevada to engage in a business or profession is convicted of or pleads guilty to engaging in an act of insurance fraud prohibited by NRS 686A.291, the commissioner and the attorney general shall forward to each agency by which the convicted person is licensed or registered a copy of the conviction or plea and all supporting evidence of the act of insurance fraud. An agency that receives information from the commissioner and attorney general pursuant to this section shall, not later than 1 year after the date on which it receives the information, submit a report which sets forth the action taken by the agency against the convicted person, including, but not limited to, the revocation or suspension of the license or any other disciplinary action, to the director of the legislative counsel bureau for transmittal to the legislature.
Sec. 4 NRS 686A.281 is hereby amended to read as follows:
686A.281 As used in NRS 686A.281 to 686A.291, inclusive, and sections 2 and 3 of this act, unless the context otherwise requires, the term "investigative or law enforcement agency" includes:
1. The state fire marshal;
2. The district attorney of the county where any fraudulent activity has occurred or a fraudulent claim has been made;
3. The chief or other officer of the fire department where a fire occurred; and
4. Any other agency in this state who has the authority to investigate the fraudulent claims or activities.
Sec. 5 NRS 686A.291 is hereby amended to read as follows:
686A.291 1. A person commits insurance fraud if he knowingly and [willfully:] with the intent to defraud, for pecuniary gain or to deprive another person of property:
(a) Presents or causes to be presented any statement to an insurer, a reinsurer, a producer, a broker or any agent thereof, known by him to contain false, incomplete or misleading information concerning any fact material to an application for the issuance of a policy of insurance pursuant to this Title.
(b) Presents or causes to be presented any statement as a part of, or in support of, a claim for payment or other benefits under a policy of insurance issued pursuant to this Title, known by him to contain false, incomplete or misleading information concerning any fact material to that claim.
(c) Assists, abets, solicits or conspires with another person to present or cause to be presented any statement to an insurer, reinsurer, producer, broker or any agent thereof, known by him to contain false, incomplete or misleading information concerning any fact material to an application for the issuance of a policy of insurance pursuant to this Title or a claim for payment or other benefits under such a policy.
(d) Acts or fails to act with the intent of defrauding or deceiving an insurer, a reinsurer, a producer, a broker or any agent thereof, in order to obtain a policy of insurance pursuant to this Title or any proceeds or other benefits under such a policy.
(e) As a practitioner, an insurer or any agent thereof, acts to assist, conspire with or urge another person to violate any provision of this section through deceit, misrepresentation or other fraudulent means.
(f) Accepts any proceeds or other benefits under a policy of insurance issued pursuant to this Title known by him to be derived from any act or omission which violates any provision of this section.
(g) Employs a runner, capper or steerer to procure clients, patients or other persons to perform or obtain services or benefits under a policy of insurance issued pursuant to this Title for the purpose of engaging in any activity prohibited by this section. Nothing in this paragraph prohibits contact or communication by an insurer or his agent or representative with a client, patient or other person if the contact or communication is made for a lawful purpose, including, without limitation, communication by an insurer with a holder of a policy of insurance issued by the insurer or with a claimant concerning the settlement of any claims against the policy. As used in this paragraph, a "runner, capper or steerer" means a person who, at the direction of or in cooperation with another person, procures clients, patients or other persons who intend to perform or obtain services or benefits under a policy of insurance issued pursuant to this Title that will be the basis of a claim against an insured or his insurer.
2. A person commits insurance fraud if he knowingly and with the intent to defraud, for pecuniary gain or to deprive another person of property, participates in, aids, abets, conspires to commit, solicits another person to commit, or permits an employee or agent to commit an act of insurance fraud prohibited by subsection 1.
3. A person who commits insurance fraud is guilty of a category D felony and shall be punished as provided in NRS 193.130.
[3.] 4. For the purposes of this section, "practitioner" means:
(a) A physician, dentist, nurse, dispensing optician, optometrist, physical therapist, podiatric physician, psychologist, chiropractor, doctor of Oriental medicine in any form, director or technician of a medical laboratory, pharmacist or other provider of health services who is authorized to engage in his occupation by the laws of this state or another state; and
(b) An attorney admitted to practice law in this state or any other state.
Sec. 6 Chapter 41 of NRS is hereby amended by adding thereto a new section to read as follows:
1. In an action for damages for personal injury or wrongful death, the defendant may introduce evidence of any collateral benefits that are or will be payable to the plaintiff as a result of the injury or death. If the defendant introduces such evidence, the plaintiff may introduce evidence that:
(a) He has paid or contributed to secure his right to the collateral benefits;
(b) Any recovery by him from the defendant is subject to a lien;
(c) The provider of the collateral benefits has a statutory right of recovery against the plaintiff as reimbursement for such benefits; or
(d) The provider of the collateral benefits has a right of subrogation to the rights of the plaintiff in the action for damages for personal injury or wrongful death.
2. Evidence introduced pursuant to this section is admissible only for the consideration by the trier of fact of the amount of damages claimed by the plaintiff.
3. Unless otherwise expressly authorized to do so by specific statute, a provider of collateral benefits may not:
(a) Recover or seek recovery of any amount from a plaintiff in an action for damages for personal injury or wrongful death to whom the provider has paid collateral benefits, as reimbursement for those benefits; or
(b) Be subrogated to the rights of the plaintiff.
Sec. 7 The amendatory provisions of subsection 3 of section 6 of this act apply only with regard to policies of insurance pursuant to which a plaintiff in an action to recover damages for personal injury or wrongful death is or may be entitled to collect collateral benefits that are issued or renewed on or after October 1, 1997.
Sec. 8 The amendatory provisions of section 5 of this act do not apply to offenses that occur before October 1, 1997.

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