Senate Commerce Committee Statement to Senate, No. 2034 — State of New Jersey (March 24, 2025)

Summary

A Senate Commerce Committee statement to the Senate on Senate Bill No. 2034 with committee amendments, State of New Jersey, dated March 24, 2025, reporting the bill favorably. As amended, the bill establishes the "Pet Insurance Act," a legal framework for selling pet insurance in the State with consumer protections on renewals, waiting periods, policy limits and benefit schedules. Pet insurers must disclose exclusions for preexisting conditions, hereditary disorders, congenital anomalies and chronic conditions, and must prove that a preexisting condition limitation applies. The bill requires pet wellness programs to be clearly differentiated from insurance and sets producer training rules, and the amendments allow licensing of producers with an active personal lines line of authority.

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SENATE COMMERCE COMMITTEE

STATEMENT TO

SENATE, No.
2034

with
committee amendments

STATE
OF NEW JERSEY

DATED: MARCH
24, 2025

The Senate Commerce Committee reports favorably and
with committee amendments Senate Bill No. 2034.

As
amended, this bill establishes the “Pet Insurance Act,” which creates a
comprehensive legal framework within which pet insurance may be sold in the
State.

Under
the bill, several consumer protections related to policy renewals, waiting
periods, policy limits, conditions, and benefit schedules are included,
including disclosures a pet insurer transacting pet insurance must disclose to
consumers, such as:

(1) if
the policy excludes coverage due to:

(a) a
preexisting condition;

(b) a
hereditary disorder;

(c) a
congenital anomaly or disorder; or

(d) a
chronic condition; and

(2) if
the policy includes any other exclusions, using the following statement: “Other
exclusions may apply. Please refer to the exclusions section of the policy for
more information.”

The
bill provides limits on how insurers can deny pet insurance claims related to
preexisting conditions of covered pets, and requires the insurer to prove a
preexisting condition limitation applies.

The
bill additionally provides requirements to insurers and insurance producers to
clearly differentiate pet wellness programs from insurance policies to
eliminate consumer confusion between what services are covered by insurance.

The
bill provides training requirements for insurance producers to ensure that
producers are appropriately prepared to present information to consumers. The
bill also stipulates that an insurance producer can only be licensed to sell
pet insurance if the producer holds an active life, health, personal lines, or
property and casualty line of authority.

As reported by the committee, Senate Bill No. 2034 is
identical to Assembly Bill No. 1203 (1R), which was also reported by the
committee on this date.

This bill was prefiled for introduction in the
2024-2025 session pending technical review. As reported, the bill includes the
changes required by technical review, which has been performed.

COMMITTEE AMENDMENTS

The committee amended the bill to stipulate that an insurance producer is qualified to be
licensed to sell pet insurance if the producer holds an active personal lines
line of authority.

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