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Arson Reporting / Immunity Law Compendium

A Comparative Review of State-Specific Laws Governing the Insurance Industry’s Arson Reporting Requirements

Compiled and edited by National Association of Mutual Insurance Companies

Immunity Provisions

All states provide immunity from liability for information supplied in connection with arson investigations. The specific types of immunity provisions fall into four categories. The first extends immunity to insurers and their representatives exclusively (AL, FL, HI, UT, WV). The second category grants immunity to insurers AND authorized state and local agencies (IN, MA, NE, NM, ND, RI, SC, SD).

The third category of immunity provisions specify insurers and their representatives UNLESS fraud, malice, lack of good faith or criminal conduct is shown (AK, AR, DC, GA, KY, LA, MD, MI, MS, MO, MT, NJ, NY, OH, NC, TX, VT). The fourth category represents an amalgam of the first three by granting immunity to insurers AND authorized agencies, UNLESS fraud, malice, lack of good faith or criminal conduct is shown (AZ, CA, CO, CT, DE, ID, IL, IA, KS, ME, MN, NV, NH, OK, OR, PA, TN, VA, WA, WI).

Requests for Information Required in Writing
Each state’s arson reporting and immunity laws indicate the general form by which authorized agencies may statutorily request relevant information from insurers to help facilitate their fire loss and arson investigations. Thirty-three states (AK, AZ, AR, CO, CT, DE, DC, HI, ID, IN, IA, KS, KY, ME, MI, MN, MS, MO, MT, NE, NJ, NM, NY, ND, OK, PA, RI, SD, SC, UT, VT, VA, WA) specifically require these requests be made in writing. The other 17 states do not specify the manner in which the request must be made.

Confidentiality Requirements
In most states, authorized agencies are required to maintain the confidentiality of all policy-related information they request and receive from insurers. Only three states (MS, UT and VT) provide no specific reference to confidentiality requirements within their arson reporting and immunity laws. Three other states (IN, KY and AK) do not specify confidentiality requirements, but do provide that the information may be shared with other authorized agencies involved in the related arson investigation. In Oregon, all such information is considered public record except investigatory testimony, information or evidence.

Three states have adopted unique twists to their confidentiality requirements. In Nevada, such records are considered confidential, unless the attorney general approves otherwise. Similarly, all insurer-supplied records in Missouri are confidential unless otherwise approved by the prosecuting attorney in the appropriate jurisdiction. And in Montana, all such records are confidential unless the insured waives their right to privacy or if the information is required in a civil or criminal proceeding.

The remainder of the state laws require all information provided by insurers for arson investigations be kept confidential. Twelve of these states (CO, CT, FL, GA, ID, IN, IA, KS, MA, ME, MN and NJ) also provide allowances that the information may be shared with other authorized agencies. The other 29 states (AL, AZ, AR, CA, DE, DC, HI, IL, LA, MD, MI, NE, NH, NM, NY, NC, ND, OH, OK, PA, RI, SC, SD, TN, TX, VA, WA, WV and WI) also establish confidentiality requirements with the caveat that the information be released for criminal or civil proceedings.

Insurer Notification Requirements
In addition to authorized agency requests for insured fire loss information, another mandate extant in nearly every state’s arson reporting and immunity laws is that insurers notify authorized agencies anytime they suspect arson may have played a part in an insured property loss. The laws in all but three states (MS, NV and WI) specifically require this particular reporting requirement.

Penalties for Noncompliance
More than half (28) the states (AL, AZ, AR, CA, CO, DC, FL, GA, ID, IL IA, KS KY, MD, MA, MN, MS, MT, NE, NH, NJ, NM, OK, OR, RI, SC, TX, VT) have established statutory penalties for failing to comply with mandatory arson reporting law requirements. Such violations are generally categorized as a misdemeanor offense. Thirteen of these state laws (AL, DC, ID, MD, MA, MS, MT, NJ, NM, OK, RI, SC, TX) set forth specific fines for noncompliance.

A few of these states established alternative penalties either instead of or in addition to specific monetary fines. In California, an authorized agency that believes an insurer has failed to comply with the state’s arson reporting requirements, may petition the appropriate Superior Court for an order requiring compliance. Maryland and South Carolina both specify either a fine or jail time for arson reporting violations. In Oregon and Utah, insurers that fail to comply with arson reporting laws face the possibility of licensure revocation, while Mississippi law provides for both fines and the possibility of license revocation. New Mexico law ties penalties in the form of monetary fines to failure to maintain the confidentiality of related arson investigatory information.

Authorized Agency Required to Respond to Insurer’s Requests for Information
In a majority of states (31) insurers themselves are allowed to request receipt of all relevant arson-related information in the possession of authorized agencies.

States that provide statutory allowance for insurers to request this information include AK, AZ, CO, CT, DE, GA, HI, IL IN IA, KS, KY, ME, MA, MN, MS, MO, NE, NJ, NM, NY, ND, OH, OK, RI, SD, TN, VA, WA and WI. In two of these states (CO, OK) the insurer may request this information, but the appropriate authorized agency is not required to comply with such request.

Authorized Agency Representatives Required to Testify
Most (33) state arson reporting laws also specify that the various statutorily defined authorized agencies are required to testify at arson-related civil or criminal proceedings. States that specify this requirement include AL, AZ, CO, CT, DE, FL, GA, HI, ID, IL, IA, KS, KY, LA, ME, MA, MI, MT, NE, NH, NJ, NY, ND, ND, OH, OK, OR, RI, SC, SD, TN, TX, WV.

Other Key Provisions
Several other important provisions unique to certain states have also been identified within the various state arson reporting laws. Most notable among these are provisions in 16 states that specifically include the state (risk-sharing) pools or plans within the definition of insurers required to comply with the arson reporting and immunity laws. Included in this category are CA, CT, DE, IL, IN IA, KS, KY, LA, MD, MI, MS, NM, OH, VA, WI.

Another relatively unique category pertains to those state laws specifying that anytime an insurer provides notification to an authorized agency regarding a suspected case of arson that such notification represents sufficient compliance for the purposes of the state’s arson reporting requirements generally. The laws in eleven states (AZ, AR, DE, KS, MN, NE, NY, RI, SC, SD, VA) provide this particular allowance.

Eight states (AZ, CO, IA, KY, MN, RI, SD, TN) specifically provide that their arson reporting laws do not abrogate any related local or municipal laws. Three states (AR, PA, SD) require policyholder notification in the event that their policy information has been requested regarding losses investigated under suspicion of arson.

Other unique provisions exist in the arson reporting laws of five states. All related insurance policies written in Arkansas are required to contain a disclosure describing the substance of its arson reporting requirements. California’s arson reporting laws highlight the existence of a common database (the Arson Report System) within the Department of Justice available to insurers, law enforcement officials, fire investigators and district attorneys that provides a central repository of arson-related insurance claim history information. Indiana’s laws specify that an authorized agency may order insurers to withhold policy payments for suspected arson claims. Finally, two states make specific reference to the severability of the provisions of their arson reporting laws. Iowa law specifies that the various provisions of the state arson reporting law are not severable, while the various provisions that make up Washington’s arson reporting laws are severable.

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