Session Review: Banking, Commerce and Insurance

Insurance coverage and banking regulation were among the issues considered by the Legislature this session.

Lawmakers removed a bill’s original provisions and created an omnibus banking bill related to the processing of tangible and intangible property.

As originally introduced by Columbus Sen. Paul Schumacher, LB788 originally dealt with security interest in government bond-pledged revenue sources. The original provisions were amended out of the bill and replaced with provisions of the following bills.

LB151, introduced by Hastings Sen. Les Seiler, creates an acquired or integrated business records exception to Nebraska’s hearsay rule.

LB775, also introduced by Seiler, provides an exception to the disclosure of confidential information rules to allows banks and other corporations to release information regarding date of death valuation and beneficiary designations for property in their possession.

LB810, introduced by Syracuse Sen. Dan Watermeier, prohibits local ordinances or resolutions from interfering with the enforcement or servicing of any real estate loan agreement or any mortgage, deed of trust or other security instrument by which the loan is secured.

LB815, introduced by Gretna Sen. John Murante, brings state law regarding the pledging of securities for trust funds awaiting investment or distribution into conformity with federal law.

LB819, introduced by Lexington Sen. John Wightman, conforms provisions regarding the way debts or obligations and future advances may be secured pursuant to a mortgage or trust deed covering an interest in real property.

LB988, introduced by Schumacher, creates a process for entry into a decedent’s safe deposit box for the limited purposes of locating a will, deed to a burial plot or burial instructions.

The bill passed on a 45-0 vote.

LB751, introduced by Lincoln Sen. Danielle Conrad, allows a business corporation to become a benefit corporation by a two-thirds vote of each class of shareholders.

Under the bill, the benefit director is required to submit an annual report to shareholders explaining whether or not the corporation’s actions were in accordance with its stated public benefit purposes. The report will describe the impact of its actions on shareholders, employees, customers, the community and the ability of the corporation to achieve its general public benefit purpose.

The bill passed 44-0.

Three bills dealing with health insurance coverage that originated in the Banking, Commerce and Insurance Committee were amended into LB254, which passed 48-0 this session.

LB505, originally introduced by Lincoln Sen. Colby Coash, requires some insurance plans in Nebraska to provide coverage for applied behavior analysis and other autism spectrum disorder treatments.

LB397, originally introduced by Conrad, requires the state Department of Health and Human Services to establish a two-year program to provide amino-acid based elemental formulas for the diagnosis and treatment of food allergies, food protein induced enterocolitis syndrome, eosinophilic disorders and short-bowel syndrome.

LB883, originally introduced by Omaha Sen. Jeremy Nordquist, repeals the Dec. 31, 2015, termination date for a requirement that individual and group health policies, certificates and contracts and self-funded employee benefit plans—to the extent not preempted by federal law—provide coverage for orally administered anticancer medication on a basis no less favorable than intravenously administered or injected anticancer medications.

A bill that ensures homeowners receive additional insurance protections passed on a 48-0 vote.

Currently, some homeowner insurance policies contain a pollution exclusion, which denies coverage for damage resulting from a carbon monoxide leak.

Under LB876, introduced by Omaha Sen. Sara Howard, any policy that includes a pollution exclusion clause must contain an exception for bodily injury sustained within a building and caused by smoke, fumes, vapor or soot from a heating or ventilation system.

A bill that updates laws governing the establishment of reserves by life and health insurers in Nebraska passed 48-0 this session.

LB755, introduced by Grand Island Sen. Mike Gloor, adopts the National Association of Insurance Commissioners (NAIC) Standard Valuation Act.

Under the bill, the state Department of Insurance director is required to adopt a valuation manual by July 1, 2017, that conforms substantially to the manual adopted by the NAIC. The bill also requires the director annually to value the reserves of every company issued on or after the operative date of the valuation manual for life insurance, deposit-type, accident and health and annuity and pure endowment outstanding contracts.

Lawmakers updated the Nebraska Real Property Appraiser Act this session and replaced the Business Corporation Act.

LB717, introduced by Gloor, brings Nebraska law into compliance with new federal real property appraiser qualification criteria that will become effective Jan. 1, 2015.

The bill passed 47-0.

LB749, introduced by Omaha Sen. Burke Harr, repeals the current Business Corporation Act and adopts a revised and updated Nebraska Model Business Corporation Act. The bill passed 48-0.

Four bills considered by the committee were not advanced to general file.

LB734, introduced by Schumacher, would have allowed deposit of public funds in credit unions insured by the National Credit Union Administration.

LB880, introduced by Scottsbluff Sen. John Harms, would have required businesses to inform a customer if preauthorization hold practices are being conducted and facilitated.

LB991, introduced by Nordquist, would have prohibited imposition of interchange fees by payment card networks on the sales tax portion of a purchase made using a debit or credit card.

LB1010, introduced by Fremont Sen. Charlie Janssen, would have created the Nebraska Enterprise Fund.