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SD House OKs protections for insurance customers

PIERRE — The state House of Representatives approved consumer protection standards for the insurance industry Thursday.

“We need something,” said Rep. Timothy Johns, R-Lead. The 63-7 vote sends the measure, HB 1054, to the Senate for consideration.

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The state Division of Insurance submitted multiple pieces of legislation this session after an internal review ordered by Gov. Dennis Daugaard.

An enforcement action by the division against a company took more than three years to finish.

The matter came to light — and to the governor’s attention — in 2013 after otherwise-confidential division documents were filed in federal court.

All of the division’s legislation seems to be progressing smoothly through the House.

The Senate Commerce and Energy Committee endorsed a bill Thursday that would set into law a practice that reportedly has been used for many years in the division.

It allows the insurance director to show a company the results of an examination as part of attempting to reach a settlement. The original document showing the division’s findings would remain confidential but the final order is public.

At the governor’s direction those final orders are now published on the division’s website.

The measure, SB 52, now heads to the full Senate for debate as early as this afternoon.

Johns said the consumer protections passed by the House on Thursday are what “is now lacking under our current standards.”

He described them as “common sense guidelines” that all insurers should be following and that consumers expect. He said they are “badly needed.”