Victims of Abuse Insurance Protection Act

Summary: Victims of Abuse Insurance Protection Act - Prohibits insurers and health carriers from engaging in specified acts (such as denying, terminating, or limiting coverage) on the basis that the applicant or insured (or any person with whom the applicant or insured is associated) is, has been, or may be the subject of abuse involving household or family members, current or former spouses, or individuals in or formerly in a sexually intimate relationship.  Prohibits insurers from using, disclosing, or transferring information about an applicant's or insured's abuse status or abuse-related medical condition for any purpose unrelated to the direct provision of health care unless required by an order of an insurance regulatory entity, a court order, or abuse reporting laws. 
Requires an insurer that takes any adverse action relating to any plan or policy of an abuse subject (whether applicant or insured) to advise such individual of the specific reasons for the action. 
Regulates subrogation of claims resulting from abuse. 
Empowers the Federal Trade Commission to examine and investigate any insurer regarding compliance with this Act.  Provides for a private cause of action against the insurer in Federal or State court by an abuse subject applicant or insured claiming to be adversely affected by an act or practice of the insurer.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Victims of Abuse Insurance 
Protection Act''.

SEC. 2. DEFINITIONS.

    As used in this Act:
            (1) The term ``abuse'' means the occurrence of one or more 
        of the following acts between household or family (including 
        in-laws or extended family) members, spouses or former spouses, 
        or individuals engaged in or formerly engaged in a sexually 
        intimate relationship:
                    (A) Attempting to cause or intentionally, 
                knowingly, or recklessly causing another person bodily 
                injury, physical harm, substantial emotional distress, 
                psychological trauma, rape, sexual assault, or 
                involuntary sexual intercourse.
                    (B) Engaging in a course of conduct or repeatedly 
                committing acts toward another person, including 
                following the person without proper authority and under 
                circumstances that place the person in reasonable fear 
                of bodily injury or physical harm.
                    (C) Subjecting another person to false imprisonment 
                or kidnapping.
                    (D) Attempting to cause or intentionally, 
                knowingly, or recklessly causing damage to property so 
                as to intimidate or attempt to control the behavior of 
                another person.
            (2) The term ``abuse-related medical condition'' means a 
        medical condition which arises in whole or in part out of an 
        action or pattern of abuse.
            (3) The term ``abuse status'' means the fact or perception 
        that a person is, has been, or may be a subject of abuse, 
        irrespective of whether the person has sustained abuse-related 
        medical conditions or has incurred abuse-related claims.
            (4) The term ``health benefit plan'' means any public or 
        private entity or program that provides for payments for health 
        care, including--
                    (A) a group health plan (as defined in section 607 
                of the Employee Retirement Income Security Act of 1974) 
                or a multiple employer welfare arrangement (as defined 
                in section 3(40) of such Act) that provides health 
                benefits;
                    (B) any other health insurance arrangement, 
                including any arrangement consisting of a hospital or 
                medical expense incurred policy or certificate, 
                hospital or medical service plan contract, or health 
                maintenance organization subscriber contract;
                    (C) workers' compensation or similar insurance to 
                the extent that it relates to workers' compensation 
                medical benefits (as defined by the Federal Trade 
                Commission); and
                    (D) automobile medical insurance to the extent that 
                it relates to medical benefits (as defined by the 
                Federal Trade Commission).
            (5) The term ``health carrier'' means a person that 
        contracts or offers to contract on a risk-assuming basis to 
        provide, deliver, arrange for, pay for or reimburse any of the 
        cost of health care services unless the person assuming the 
        risk is accepting the risk from a duly licensed health carrier.
            (6) The term ``insured'' means a party named on a policy, 
        certificate, or health benefit plan as the person with legal 
        rights to the benefits provided by the policy, certificate, or 
        health benefit plan. For group insurance, such term includes a 
        person who is a beneficiary covered by a group policy, 
        certificate, or health benefit plan.
            (7) The term ``insurer'' means any person, reciprocal 
        exchange, interinsurer, Lloyds insurer, fraternal benefit 
        society, or other legal entity engaged in the business of 
        insurance, including agents, brokers, adjusters, and third 
        party administrators. The term also includes health carriers, 
        health benefit plans, and life, disability, and property and 
        casualty insurers.
            (8) The term ``policy'' means a contract of insurance, 
        certificate, indemnity, suretyship, or annuity issued, proposed 
        for issuance or intended for issuance by an insurer, including 
        endorsements or riders to an insurance policy or contract.
            (9) The term ``subject of abuse'' means a person to whom an 
        act of abuse is directed, a person who has had prior or current 
        injuries, illnesses, or disorders that resulted from abuse, or 
        a person who seeks, may have sought, or should have sought 
        medical or psychological treatment for abuse, protection, 
        court-ordered protection, or shelter from abuse.

SEC. 3. DISCRIMINATORY ACTS PROHIBITED.

    (a) In General.--No insurer or health carrier may, directly or 
indirectly, engage in any of the following acts or practices on the 
basis that the applicant or insured, or any person employed by the 
applicant or insured or with whom the applicant or insured is known to 
have a relationship or association, is, has been, or may be the subject 
of abuse:
            (1) Denying, refusing to issue, renew or reissue, or 
        canceling or otherwise terminating an insurance policy or 
        health benefit plan.
            (2) Restricting, excluding, or limiting insurance or health 
        benefit plan coverage for losses as a result of abuse or 
        denying a claim incurred by an insured as a result of abuse, 
        except as otherwise permitted or required by State laws 
relating to life insurance beneficiaries.
            (3) Adding a premium differential to any insurance policy 
        or health benefit plan.
            (4) Terminating health coverage for a subject of abuse 
        because coverage was originally issued in the name of the 
        abuser and the abuser has divorced, separated from, or lost 
        custody of the subject of abuse or the abuser's coverage has 
        terminated voluntarily or involuntarily and the subject of 
        abuse does not qualify for extension of coverage under part 6 
        of subtitle B of title I or the Employee Retirement Income 
        Security Act of 1974 (29 U.S.C. 1161 et seq.) or 4980B of the 
        Internal Revenue Code of 1986. Nothing in this paragraph 
        prohibits the insurer from requiring the subject of abuse to 
        pay the full premium for the subject's coverage under the 
        health plan. The insurer may terminate group coverage after the 
        continuation coverage required by this paragraph has been in 
        force for 18 months if it offers conversion to an equivalent 
        individual plan. The continuation of health coverage required 
        by this paragraph shall be satisfied by any extension of 
        coverage under part 6 of subtitle B of title I or the Employee 
        Retirement Income Security Act of 1974 (29 U.S.C. 1161 et seq.) 
        or 4980B of the Internal Revenue Code of 1986 provided to a 
        subject of abuse and is not intended to be in addition to any 
        extension of coverage provided under part 6 of subtitle B of 
        title I or the Employee Retirement Income Security Act of 1974 
        (29 U.S.C. 1161 et seq.) or 4980B of the Internal Revenue Code 
        of 1986.
    (b) Use of Information.--
            (1) In general.--No insurer may use, disclose, or transfer 
        information relating to an applicant's or insured's abuse 
        status or abuse-related medical condition or the applicant's or 
        insured's status as a family member, employer or associate, 
        person in a relationship with a subject of abuse for any 
        purpose unrelated to the direct provision of health care 
        services unless such use, disclosure, or transfer is required 
        by an order of an entity with authority to regulate insurance 
        or an order of a court of competent jurisdiction or by abuse 
        reporting laws. Nothing in this paragraph shall be construed as 
        limiting or precluding a subject of abuse from obtaining the 
        subject's own medical records from an insurer.
            (2) Authority of subject of abuse.--A subject of abuse, at 
        the absolute discretion of the subject of abuse, may provide 
        evidence of abuse to an insurer for the limited purpose of 
        facilitating treatment of an abuse-related condition or 
        demonstrating that a condition is abuse-related. Nothing in 
        this paragraph shall be construed as authorizing an insurer or 
        health carrier to disregard such provided evidence.

SEC. 4. REASONS FOR ADVERSE ACTIONS.

    An insurer that takes any adverse action relating to any plan or 
policy of a subject of abuse, shall advise the subject of abuse 
applicant or insured of the specific reasons for the action in writing. 
Reference to general underwriting practices or guidelines does not 
constitute a specific reason.

SEC. 5. LIFE INSURANCE.

    Nothing in this Act shall be construed to prohibit a life insurer 
from declining to issue a life insurance policy if the applicant or 
prospective owner of the policy is or would be designated as a 
beneficiary of the policy, and if--
            (1) the applicant or prospective owner of the policy lacks 
        an insurable interest in the insured; or
            (2) the applicant or prospective owner of the policy is 
        known, on the basis of police or court records, to have 
        committed an act of abuse.

SEC. 6. SUBROGATION WITHOUT CONSENT PROHIBITED.

    Except where the subject of abuse has already recovered damages, 
subrogation of claims resulting from abuse is prohibited with the 
informed consent of the subject of abuse.

SEC. 7. ENFORCEMENT.

    (a) Federal Trade Commission.--The Federal Trade Commission shall 
have the power to examine and investigate any insurer to determine 
whether such insurer has been or is engaged in any act or practice 
prohibited by this Act. If the Federal Trade Commission determines an 
insurer has been or is engaged in any act or practice prohibited by 
this Act, the Commission may take action against such insurer by the 
issuance of a cease and desist order as if the insurer was in violation 
of section 5 of the Federal Trade Commission Act. Such cease and desist 
order may include any individual relief warranted under the 
circumstances, including temporary, preliminary, and permanent 
injunctive and compensatory relief.
    (b) Private Cause of Action.--An applicant or insured claiming to 
be adversely affected by an act or practice of an insurer in violation 
of this Act may maintain an action against the insurer in a Federal or 
State court of original jurisdiction. Upon proof of such conduct by a 
preponderance of the evidence, the court may award appropriate relief, 
including temporary, preliminary, and permanent injunctive relief and 
compensatory and punitive damages, as well as the costs of suit and 
reasonable fees for the aggrieved individual's attorneys and expert 
witnesses. With respect to compensatory damages, the aggrieved 
individual may elect, at any time prior to the rendering of final 
judgment, to recover in lieu of actual damages, an award of statutory 
damages in the amount of $5,000 for each violation.