H.B. 342

This document includes House Committee Amendments incorporated into the bill on Mon, Feb 4, 2008 at 3:48 PM by ddonat. --> This document includes House Floor Amendments incorporated into the bill on Tue, Feb 12, 2008 at 5:50 PM by ddonat. --> This document includes House Floor Amendments incorporated into the bill on Tue, Feb 12, 2008 at 6:04 PM by ddonat. --> This document includes Senate Committee Amendments incorporated into the bill on Thu, Feb 21, 2008 at 2:38 PM by rday. --> 1

INSURANCE CODE AMENDMENTS
2 2008 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: James A. Dunnigan
5 Senate Sponsor: Sheldon L. Killpack
6
7 LONG TITLE
8 General Description:
9 This bill modifies the Insurance Code to make various amendments.
10 Highlighted Provisions:
11 This bill:
12 . modifies definition provisions;
13 . addresses the timing of examinations;
14 . changes the requirements for appointments to the Title and Escrow Commission;
15 . addresses requirements to conduct an insurance business in Utah;
16 . addresses filing of evidence of preemption;
17 . addresses service contract providers and service contract reimbursement insurance
18 policies including:
19 . prohibiting a captive insurance company from writing certain reimbursement
20 policies for service contract providers;
21 . requiring registration;
22 . requiring disclosures; and
23 . addressing prohibited acts;
24 . addresses how to calculate monies paid a beneficiary in certain circumstances where
25 a suicide occurs;
26 . addresses certain circumstances related to annuity payments;
27 . addresses the Basic Health Care Plan;

28 . clarifies language related to catastrophic coverage of mental health conditions;
29 . provides for the payment of interest on life insurance proceeds;
30 . provides for special enrollment for individuals receiving premium assistance;
31 . clarifies circumstances when the commissioner can prohibit a policy, contract,
32 certificate, or form;
33 . requires submission to criminal background checks in certain circumstances;
34 . modifies the contents of a form used in a license;
35 . addresses grounds involving a viatical settlement for action against a licensee;
36 . makes technical changes regarding delinquency proceedings;
37 . expands the purposes of the Individual, Small Employer, and Group Health
38 Insurance Act; S. and
39 [ . addresses when individual carriers must accept individuals; and ] .S
40 . makes additional technical amendments.
41 Monies Appropriated in this Bill:
42 None
43 Other Special Clauses:
44 None
45 Utah Code Sections Affected:
46 AMENDS:
47 31A-1-301, as last amended by Laws of Utah 2007, Chapter 307
48 31A-2-203, as last amended by Laws of Utah 2007, Chapter 309
49 31A-2-403, as last amended by Laws of Utah 2007, Chapter 325
50 31A-4-102, as last amended by Laws of Utah 1998, Chapter 293
51 31A-4-106, as last amended by Laws of Utah 2003, Chapter 298
52 31A-6a-103, as last amended by Laws of Utah 2005, Chapter 124
53 31A-6a-104, as enacted by Laws of Utah 1992, Chapter 203
54 31A-6a-105, as enacted by Laws of Utah 1992, Chapter 203
55 31A-22-404, as last amended by Laws of Utah 2002, Chapter 308
56 31A-22-409, as last amended by Laws of Utah 2005, Chapter 125
57 31A-22-613.5, as last amended by Laws of Utah 2007, Chapter 307
58 31A-22-625, as last amended by Laws of Utah 2002, Chapter 308

59 31A-22-807, as last amended by Laws of Utah 2001, Chapter 116
60 31A-23a-105, as last amended by Laws of Utah 2007, Chapter 307
61 31A-23a-110, as renumbered and amended by Laws of Utah 2003, Chapter 298
62 31A-23a-111, as last amended by Laws of Utah 2006, Chapter 312
63 31A-23a-116, as renumbered and amended by Laws of Utah 2003, Chapter 298
64 31A-25-203, as last amended by Laws of Utah 2006, Chapter 312
65 31A-26-203, as last amended by Laws of Utah 2006, Chapter 312
66 31A-27a-513, as enacted by Laws of Utah 2007, Chapter 309
67 31A-27a-515, as enacted by Laws of Utah 2007, Chapter 309
68 31A-27a-516, as enacted by Laws of Utah 2007, Chapter 309
69 31A-30-102, as last amended by Laws of Utah 1997, Chapter 265
70 S. [ 31A-30-108, as last amended by Laws of Utah 2004, Chapters 2 and 329 ] .S
71 31A-30-112, as last amended by Laws of Utah 2007, Chapter 307
72 ENACTS:
73 31A-22-428, Utah Code Annotated 1953
74 31A-22-610.6, Utah Code Annotated 1953
75
76 Be it enacted by the Legislature of the state of Utah:
77 Section 1. Section 31A-1-301 is amended to read:
78 31A-1-301. Definitions.
79 As used in this title, unless otherwise specified:
80 (1) (a) "Accident and health insurance" means insurance to provide protection against
81 economic losses resulting from:
82 (i) a medical condition including:
83 (A) a medical care [expenses] expense; or
84 (B) the risk of disability;
85 (ii) accident; or
86 (iii) sickness.
87 (b) "Accident and health insurance":
88 (i) includes a contract with disability contingencies including:
89 (A) an income replacement contract;

90 (B) a health care contract;
91 (C) an expense reimbursement contract;
92 (D) a credit accident and health contract;
93 (E) a continuing care contract; and
94 (F) a long-term care contract; and
95 (ii) may provide:
96 (A) hospital coverage;
97 (B) surgical coverage;
98 (C) medical coverage; [or]
99 (D) loss of income coverage[.];
100 (E) prescription drug coverage;
101 (F) dental coverage; or
102 (G) vision coverage.
103 (c) "Accident and health insurance" does not include workers' compensation insurance.
104 (2) "Actuary" is as defined by the commissioner by rule, made in accordance with Title
105 63, Chapter 46a, Utah Administrative Rulemaking Act.
106 (3) "Administrator" is defined in Subsection [(157)] (159).
107 (4) "Adult" means a natural person who has attained the age of at least 18 years.
108 (5) "Affiliate" means [any] a person who controls, is controlled by, or is under
109 common control with, another person. A corporation is an affiliate of another corporation,
110 regardless of ownership, if substantially the same group of natural persons manages the
111 corporations.
112 (6) "Agency" means:
113 (a) a person other than an individual, including a sole proprietorship by which a natural
114 person does business under an assumed name; and
115 (b) an insurance organization licensed or required to be licensed under Section
116 31A-23a-301 .
117 (7) "Alien insurer" means an insurer domiciled outside the United States.
118 (8) "Amendment" means an endorsement to an insurance policy or certificate.
119 (9) "Annuity" means an agreement to make periodical payments for a period certain or
120 over the lifetime of one or more natural persons if the making or continuance of all or some of

121 the series of the payments, or the amount of the payment, is dependent upon the continuance of
122 human life.
123 (10) "Application" means a document:
124 (a) (i) completed by an applicant to provide information about the risk to be insured;
125 and
126 (ii) that contains information that is used by the insurer to evaluate risk and decide
127 whether to:
128 (A) insure the risk under:
129 (I) the [coverages] coverage as originally offered; or
130 (II) a modification of the coverage as originally offered; or
131 (B) decline to insure the risk; or
132 (b) used by the insurer to gather information from the applicant before issuance of an
133 annuity contract.
134 (11) "Articles" or "articles of incorporation" means:
135 (a) the original articles[,];
136 (b) a special [laws, charters, amendments,] law;
137 (c) a charter;
138 (d) an amendment;
139 (e) restated articles[,];
140 (f) articles of merger or consolidation[, trust instruments, and other constitutive
141 documents for trusts and other entities that are not corporations, and amendments to any of
142 these.];
143 (g) a trust instrument;
144 (h) another constitutive document for a trust or other entity that is not a corporation;
145 and
146 (i) an amendment to an item listed in Subsections (11)(a) through (h).
147 (12) "Bail bond insurance" means a guarantee that a person will attend court when
148 required, up to and including surrender of the person in execution of [any] a sentence imposed
149 under Subsection 77-20-7 (1), as a condition to the release of that person from confinement.
150 (13) "Binder" is defined in Section 31A-21-102 .
151 (14) "Blanket insurance policy" means a group policy covering [classes] a defined class

152 of persons:
153 (a) without individual underwriting[, where the persons insured are] or application; and
154 (b) that is determined by definition [of the class] with or without designating [the
155 persons] each person covered.
156 (15) "Board," "board of trustees," or "board of directors" means the group of persons
157 with responsibility over, or management of, a corporation, however designated.
158 (16) "Business entity" means:
159 (a) a corporation[,];
160 (b) an association[,];
161 (c) a partnership[,];
162 (d) a limited liability company[,];
163 (e) a limited liability partnership[,]; or [other]
164 (f) another legal entity.
165 (17) "Business of insurance" is defined in Subsection [(84)] (85).
166 (18) "Business plan" means the information required to be supplied to the
167 commissioner under Subsections 31A-5-204 (2)(i) and (j), including the information required
168 when these subsections [are applicable] apply by reference under:
169 (a) Section 31A-7-201 ;
170 (b) Section 31A-8-205 ; or
171 (c) Subsection 31A-9-205 (2).
172 (19) (a) "Bylaws" means the rules adopted for the regulation or management of a
173 corporation's affairs, however designated [and].
174 (b) "Bylaws" includes comparable rules for [trusts and other entities that are not
175 corporations] a trust or other entity that is not a corporation.
176 (20) "Captive insurance company" means:
177 (a) an [insurance company] insurer:
178 (i) owned by another organization; and
179 (ii) whose exclusive purpose is to insure risks of the parent organization and an
180 affiliated [companies] company; or
181 (b) in the case of [groups and associations, an insurance organization] a group or
182 association, an insurer:

183 (i) owned by the insureds; and
184 (ii) whose exclusive purpose is to insure risks of:
185 (A) a member [organizations] organization;
186 (B) a group [members; and] member; or
187 (C) [affiliates] an affiliate of:
188 (I) a member [organizations] organization; or
189 (II) a group [members] member.
190 (21) "Casualty insurance" means liability insurance as defined in Subsection [(96)]
191 (97).
192 (22) "Certificate" means evidence of insurance given to:
193 (a) an insured under a group insurance policy; or
194 (b) a third party.
195 (23) "Certificate of authority" is included within the term "license."
196 (24) "Claim," unless the context otherwise requires, means a request or demand on an
197 insurer for payment of [benefits] a benefit according to the terms of an insurance policy.
198 (25) "Claims-made coverage" means an insurance contract or provision limiting
199 coverage under a policy insuring against legal liability to claims that are first made against the
200 insured while the policy is in force.
201 (26) (a) "Commissioner" or "commissioner of insurance" means Utah's insurance
202 commissioner.
203 (b) When appropriate, the terms listed in Subsection (26)(a) apply to the equivalent
204 supervisory official of another jurisdiction.
205 (27) (a) "Continuing care insurance" means insurance that:
206 (i) provides board and lodging;
207 (ii) provides one or more of the following [services]:
208 (A) a personal [services] service;
209 (B) a nursing [services] service;
210 (C) a medical [services] service; or
211 (D) any other health-related [services] service; and
212 (iii) provides the coverage described in Subsection (27)(a)(i) under an agreement
213 effective:

214 (A) for the life of the insured; or
215 (B) for a period in excess of one year.
216 (b) Insurance is continuing care insurance regardless of whether or not the board and
217 lodging are provided at the same location as [the services] a service described in Subsection
218 (27)(a)(ii).
219 (28) (a) "Control," "controlling," "controlled," or "under common control" means the
220 direct or indirect possession of the power to direct or cause the direction of the management
221 and policies of a person. This control may be:
222 (i) by contract;
223 (ii) by common management;
224 (iii) through the ownership of voting securities; or
225 (iv) by a means other than those described in Subsections (28)(a)(i) through (iii).
226 (b) There is no presumption that an individual holding an official position with another
227 person controls that person solely by reason of the position.
228 (c) A person having a contract or arrangement giving control is considered to have
229 control despite the illegality or invalidity of the contract or arrangement.
230 (d) There is a rebuttable presumption of control in a person who directly or indirectly
231 owns, controls, holds with the power to vote, or holds proxies to vote 10% or more of the
232 voting securities of another person.
233 (29) "Controlled insurer" means a licensed insurer that is either directly or indirectly
234 controlled by a producer.
235 (30) "Controlling person" means [any] a person that directly or indirectly has the power
236 to direct or cause to be directed, the management, control, or activities of a reinsurance
237 intermediary.
238 (31) "Controlling producer" means a producer who directly or indirectly controls an
239 insurer.
240 (32) (a) "Corporation" means an insurance corporation, except when referring to:
241 (i) a corporation doing business:
242 (A) as:
243 (I) an insurance producer;
244 (II) a limited line producer;

245 (III) a consultant;
246 (IV) a managing general agent;
247 (V) a reinsurance intermediary;
248 (VI) a third party administrator; or
249 (VII) an adjuster; and
250 (B) under:
251 (I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
252 Reinsurance Intermediaries;
253 (II) Chapter 25, Third Party Administrators; or
254 (III) Chapter 26, Insurance Adjusters; or
255 (ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance
256 Holding Companies.
257 (b) "Stock corporation" means a stock insurance corporation.
258 (c) "Mutual" or "mutual corporation" means a mutual insurance corporation.
259 (33) "Creditable coverage" has the same meaning as provided in federal regulations
260 adopted pursuant to the Health Insurance Portability and Accountability Act of 1996, Pub. L.
261 104-191, 110 Stat. 1936.
262 (34) "Credit accident and health insurance" means insurance on a debtor to provide
263 indemnity for payments coming due on a specific loan or other credit transaction while the
264 debtor is disabled.
265 (35) (a) "Credit insurance" means insurance offered in connection with an extension of
266 credit that is limited to partially or wholly extinguishing that credit obligation.
267 (b) "Credit insurance" includes:
268 (i) credit accident and health insurance;
269 (ii) credit life insurance;
270 (iii) credit property insurance;
271 (iv) credit unemployment insurance;
272 (v) guaranteed automobile protection insurance;
273 (vi) involuntary unemployment insurance;
274 (vii) mortgage accident and health insurance;
275 (viii) mortgage guaranty insurance; and

276 (ix) mortgage life insurance.
277 (36) "Credit life insurance" means insurance on the life of a debtor in connection with
278 an extension of credit that pays a person if the debtor dies.
279 (37) "Credit property insurance" means insurance:
280 (a) offered in connection with an extension of credit; and
281 (b) that protects the property until the debt is paid.
282 (38) "Credit unemployment insurance" means insurance:
283 (a) offered in connection with an extension of credit; and
284 (b) that provides indemnity if the debtor is unemployed for payments coming due on a:
285 (i) specific loan; or
286 (ii) credit transaction.
287 (39) "Creditor" means a person, including an insured, having [any] a claim, whether:
288 (a) matured;
289 (b) unmatured;
290 (c) liquidated;
291 (d) unliquidated;
292 (e) secured;
293 (f) unsecured;
294 (g) absolute;
295 (h) fixed; or
296 (i) contingent.
297 (40) (a) "Customer service representative" means a person that provides an insurance
298 [services] service and insurance product information:
299 (i) for the customer service representative's:
300 (A) producer; or
301 (B) consultant employer; and
302 (ii) to the customer service representative's employer's:
303 (A) customer;
304 (B) client; or
305 (C) organization.
306 (b) A customer service representative may only operate within the scope of authority of

307 the customer service representative's producer or consultant employer.
308 (41) "Deadline" means the final date or time:
309 (a) imposed by:
310 (i) statute;
311 (ii) rule; or
312 (iii) order; and
313 (b) by which a required filing or payment must be received by the department.
314 (42) "Deemer clause" means a provision under this title under which upon the
315 occurrence of a condition precedent, the commissioner is [deemed] considered to have taken a
316 specific action. If the statute so provides, [the] a condition precedent may be the
317 commissioner's failure to take a specific action.
318 (43) "Degree of relationship" means the number of steps between two persons
319 determined by counting the generations separating one person from a common ancestor and
320 then counting the generations to the other person.
321 (44) "Department" means the Insurance Department.
322 (45) "Director" means a member of the board of directors of a corporation.
323 (46) "Disability" means a physiological or psychological condition that partially or
324 totally limits an individual's ability to:
325 (a) perform the duties of:
326 (i) that individual's occupation; or
327 (ii) any occupation for which the individual is reasonably suited by education, training,
328 or experience; or
329 (b) perform two or more of the following basic activities of daily living:
330 (i) eating;
331 (ii) toileting;
332 (iii) transferring;
333 (iv) bathing; or
334 (v) dressing.
335 (47) "Disability income insurance" is defined in Subsection [(75)] (76).
336 (48) "Domestic insurer" means an insurer organized under the laws of this state.
337 (49) "Domiciliary state" means the state in which an insurer:

338 (a) is incorporated;
339 (b) is organized; or
340 (c) in the case of an alien insurer, enters into the United States.
341 (50) (a) "Eligible employee" means:
342 (i) an employee who:
343 (A) works on a full-time basis; and
344 (B) has a normal work week of 30 or more hours; S. [ [ ] or [ ] ]
345 [ [ ] (ii) a person described in Subsection (50) (b). [ ] ]
346 [ [ ] (b) "Eligible employee" includes, if the individual is included under a health benefit
347 plan of a small employer: [ ] ] .S
348 [(i)] S. [ (ii) ] (i) .S a sole proprietor;
349 [(ii)] S. [ (iii) ] (ii) .S a partner in a partnership; or
350 [(iii)] S. [ (iv) ] (iii) .S an independent contractor.
351 [(c)] S. [(b)] (c) .S "Eligible employee" does not include H. [[] , unless eligible under Subsection
352 (50)(b): (i) [ ] ] .H an individual who works on a temporary or substitute basis for a small
352a employer H. [ [ ] ; [ ] ] [ . ]
353 [ [ ] (ii) an employer's spouse; or [ ] ]
354 [ [ ] (iii) a dependent of an employer. [ ] ] .H
355 (51) "Employee" means [any] an individual employed by an employer.
356 (52) "Employee benefits" means one or more benefits or services provided to:
357 (a) [employees] an employee; or
358 (b) [dependents of employees] a dependent of an employee.
359 (53) (a) "Employee welfare fund" means a fund:
360 (i) established or maintained, whether directly or through [trustees] a trustee, by:
361 (A) one or more employers;
362 (B) one or more labor organizations; or
363 (C) a combination of employers and labor organizations; and
364 (ii) that provides employee benefits paid or contracted to be paid, other than income
365 from investments of the fund[,]:
366 (A) by or on behalf of an employer doing business in this state; or
367 (B) for the benefit of [any] a person employed in this state.
368 (b) "Employee welfare fund" includes a plan funded or subsidized by a user [fees] fee

369 or tax revenues.
370 (54) "Endorsement" means a written agreement attached to a policy or certificate to
371 modify one or more of the provisions of the policy or certificate.
372 (55) "Enrollment date," with respect to a health benefit plan, means:
373 (a) the first day of coverage; or[,]
374 (b) if there is a waiting period, the first day of the waiting period.
375 (56) (a) "Escrow" means:
376 (i) a real estate settlement or real estate closing conducted by a third party pursuant to
377 the requirements of a written agreement between the parties in a real estate transaction; or
378 (ii) a settlement or closing involving:
379 (A) a mobile home;
380 (B) a grazing right;
381 (C) a water right; or
382 (D) other personal property authorized by the commissioner.
383 (b) "Escrow" includes the act of conducting a:
384 (i) real estate settlement; or
385 (ii) real estate closing.
386 (57) "Escrow agent" means:
387 (a) an insurance producer with:
388 (i) a title insurance line of authority; and
389 (ii) an escrow subline of authority; or
390 (b) a person defined as an escrow agent in Section 7-22-101 .
391 (58) (a) "Excludes" is not exhaustive and does not mean that [other things are] another
392 thing is not also excluded.
393 (b) The items listed in a list using the term "excludes" are representative examples for
394 use in interpretation of this title.
395 (59) "Exclusion" means for the purposes of accident and health insurance that an
396 insurer does not provide insurance coverage, for whatever reason, for one of the following:
397 (a) a specific physical condition;
398 (b) a specific medical procedure;
399 (c) a specific disease or disorder; or

400 (d) a specific prescription drug or class of prescription drugs.
401 [(59)] (60) "Expense reimbursement insurance" means insurance:
402 (a) written to provide [payments for expenses] a payment for an expense relating to
403 hospital [confinements] confinement resulting from illness or injury; and
404 (b) written:
405 (i) as a daily limit for a specific number of days in a hospital; and
406 (ii) to have a one or two day waiting period following a hospitalization.
407 [(60)] (61) "Fidelity insurance" means insurance guaranteeing the fidelity of [persons]
408 a person holding [positions] a position of public or private trust.
409 [(61)] (62) (a) "Filed" means that a filing is:
410 (i) submitted to the department as required by and in accordance with [any] applicable
411 statute, rule, or filing order;
412 (ii) received by the department within the time period provided in [the] applicable
413 statute, rule, or filing order; and
414 (iii) accompanied by the appropriate fee in accordance with:
415 (A) Section 31A-3-103 ; or
416 (B) rule.
417 (b) "Filed" does not include a filing that is rejected by the department because it is not
418 submitted in accordance with Subsection [(61)] (62)(a).
419 [(62)] (63) "Filing," when used as a noun, means an item required to be filed with the
420 department including:
421 (a) a policy;
422 (b) a rate;
423 (c) a form;
424 (d) a document;
425 (e) a plan;
426 (f) a manual;
427 (g) an application;
428 (h) a report;
429 (i) a certificate;
430 (j) an endorsement;

431 (k) an actuarial certification;
432 (l) a licensee annual statement;
433 (m) a licensee renewal application; [or]
434 (n) an advertisement; or
435 (o) an outline of coverage.
436 [(63)] (64) "First party insurance" means an insurance policy or contract in which the
437 insurer agrees to pay [claims] a claim submitted to it by the insured for the insured's losses.
438 [(64)] (65) "Foreign insurer" means an insurer domiciled outside of this state, including
439 an alien insurer.
440 [(65)] (66) (a) "Form" means one of the following prepared for general use:
441 (i) a policy;
442 (ii) a certificate;
443 (iii) an application; [or]
444 (iv) an outline of coverage; or
445 (v) an endorsement.
446 (b) "Form" does not include a document specially prepared for use in an individual
447 case.
448 [(66)] (67) "Franchise insurance" means an individual insurance [policies] policy
449 provided through a mass marketing arrangement involving a defined class of persons related in
450 some way other than through the purchase of insurance.
451 [(67)] (68) "General lines of authority" include:
452 (a) the general lines of insurance in Subsection [(68)] (69);
453 (b) title insurance under one of the following sublines of authority:
454 (i) search, including authority to act as a title marketing representative;
455 (ii) escrow, including authority to act as a title marketing representative;
456 (iii) search and escrow, including authority to act as a title marketing representative;
457 and
458 (iv) title marketing representative only;
459 (c) surplus lines;
460 (d) workers' compensation; and
461 (e) any other line of insurance that the commissioner considers necessary to recognize

462 in the public interest.
463 [(68)] (69) "General lines of insurance" include:
464 (a) accident and health;
465 (b) casualty;
466 (c) life;
467 (d) personal lines;
468 (e) property; and
469 (f) variable contracts, including variable life and annuity.
470 [(69)] (70) "Group health plan" means an employee welfare benefit plan to the extent
471 that the plan provides medical care:
472 (a) (i) to [employees] an employee; or
473 (ii) to a dependent of an employee; and
474 (b) (i) directly;
475 (ii) through insurance reimbursement; or
476 (iii) through [any other] another method.
477 [(70)] (71) (a) "Group insurance policy" means a policy covering a group of persons
478 that is issued:
479 (i) to a policyholder on behalf of the group; and
480 (ii) for the benefit of [group members who are] a member of the group who is selected
481 under [procedures] a procedure defined in:
482 (A) the policy; or
483 (B) [agreements which are] an agreement that is collateral to the policy.
484 (b) A group insurance policy may include [members] a member of the policyholder's
485 family or [dependents] a dependent.
486 [(71)] (72) "Guaranteed automobile protection insurance" means insurance offered in
487 connection with an extension of credit that pays the difference in amount between the
488 insurance settlement and the balance of the loan if the insured automobile is a total loss.
489 [(72)] (73) (a) Except as provided in Subsection [(72)] (73)(b), "health benefit plan"
490 means a policy or certificate that:
491 (i) provides health care insurance;
492 (ii) provides major medical expense insurance; or

493 (iii) is offered as a substitute for hospital or medical expense insurance such as:
494 (A) a hospital confinement indemnity; or
495 (B) a limited benefit plan.
496 (b) "Health benefit plan" does not include a policy or certificate that:
497 (i) provides benefits solely for:
498 (A) accident;
499 (B) dental;
500 (C) income replacement;
501 (D) long-term care;
502 (E) a Medicare supplement;
503 (F) a specified disease;
504 (G) vision; or
505 (H) a short-term limited duration; or
506 (ii) is offered and marketed as supplemental health insurance.
507 [(73)] (74) "Health care" means any of the following intended for use in the diagnosis,
508 treatment, mitigation, or prevention of a human ailment or impairment:
509 (a) a professional [services] service;
510 (b) a personal [services] service;
511 (c) [facilities] a facility;
512 (d) equipment;
513 (e) [devices] a device;
514 (f) supplies; or
515 (g) medicine.
516 [(74)] (75) (a) "Health care insurance" or "health insurance" means insurance
517 providing:
518 (i) a health care [benefits] benefit; or
519 (ii) payment of an incurred health care [expenses] expense.
520 (b) "Health care insurance" or "health insurance" does not include accident and health
521 insurance providing [benefits] a benefit for:
522 (i) replacement of income;
523 (ii) short-term accident;

524 (iii) fixed indemnity;
525 (iv) credit accident and health;
526 (v) supplements to liability;
527 (vi) workers' compensation;
528 (vii) automobile medical payment;
529 (viii) no-fault automobile;
530 (ix) equivalent self-insurance; or
531 (x) [any] a type of accident and health insurance coverage that is a part of or attached
532 to another type of policy.
533 [(75)] (76) "Income replacement insurance" or "disability income insurance" means
534 insurance written to provide payments to replace income lost from accident or sickness.
535 [(76)] (77) "Indemnity" means the payment of an amount to offset all or part of an
536 insured loss.
537 [(77)] (78) "Independent adjuster" means an insurance adjuster required to be licensed
538 under Section 31A-26-201 who engages in insurance adjusting as a representative of [insurers]
539 an insurer.
540 [(78)] (79) "Independently procured insurance" means insurance procured under
541 Section 31A-15-104 .
542 [(79)] (80) "Individual" means a natural person.
543 [(80)] (81) "Inland marine insurance" includes insurance covering:
544 (a) property in transit on or over land;
545 (b) property in transit over water by means other than boat or ship;
546 (c) bailee liability;
547 (d) fixed transportation property such as bridges, electric transmission systems, radio
548 and television transmission towers and tunnels; and
549 (e) personal and commercial property floaters.
550 [(81)] (82) "Insolvency" means that:
551 (a) an insurer is unable to pay its debts or meet its obligations as [they] the debts and
552 obligations mature;
553 (b) an insurer's total adjusted capital is less than the insurer's mandatory control level
554 RBC under Subsection 31A-17-601 (8)(c); or

555 (c) an insurer is determined to be hazardous under this title.
556 [(82)] (83) (a) "Insurance" means:
557 (i) an arrangement, contract, or plan for the transfer of a risk or risks from one or more
558 persons to one or more other persons; or
559 (ii) an arrangement, contract, or plan for the distribution of a risk or risks among a
560 group of persons that includes the person seeking to distribute that person's risk.
561 (b) "Insurance" includes:
562 (i) a risk distributing [arrangements] arrangement providing for compensation or
563 replacement for damages or loss through the provision of [services or benefits] a service or a
564 benefit in kind;
565 (ii) [contracts] a contract of guaranty or suretyship entered into by the guarantor or
566 surety as a business and not as merely incidental to a business transaction; and
567 (iii) [plans] a plan in which the risk does not rest upon the person who makes [the
568 arrangements] an arrangement, but with a class of persons who have agreed to share [it] the
569 risk.
570 [(83)] (84) "Insurance adjuster" means a person who directs the investigation,
571 negotiation, or settlement of a claim under an insurance policy other than life insurance or an
572 annuity, on behalf of an insurer, policyholder, or a claimant under an insurance policy.
573 [(84)] (85) "Insurance business" or "business of insurance" includes:
574 (a) providing health care insurance, as defined in Subsection [(74)] (75), by
575 [organizations that are] an organization that is or should be licensed under this title;
576 (b) providing [benefits to employees] a benefit to an employee in the event of
577 [contingencies] a contingency not within the control of the [employees] employee, in which the
578 [employees are] employee is entitled to the [benefits] benefit as a right, which [benefits] benefit
579 may be provided either:
580 (i) by a single [employers] employer or by multiple employer groups; or
581 (ii) through one or more trusts, associations, or other entities;
582 (c) providing [annuities,] an annuity:
583 (i) including [those] an annuity issued in return for [gifts,] a gift; and
584 (ii) except [those] an annuity provided by [persons] a person specified in Subsections
585 31A-22-1305 (2) and (3);

586 (d) providing the characteristic services of a motor [clubs] club as outlined in
587 Subsection [(112)] (113);
588 (e) providing [other persons] another person with insurance as defined in Subsection
589 [(82)] (83);
590 (f) making as insurer, guarantor, or surety, or proposing to make as insurer, guarantor,
591 or surety, [any] a contract or policy of title insurance;
592 (g) transacting or proposing to transact any phase of title insurance, including:
593 (i) solicitation;
594 (ii) negotiation preliminary to execution;
595 (iii) execution of a contract of title insurance;
596 (iv) insuring; and
597 (v) transacting matters subsequent to the execution of the contract and arising out of
598 the contract, including reinsurance; and
599 (h) doing, or proposing to do, any business in substance equivalent to Subsections
600 [(84)] (85)(a) through (g) in a manner designed to evade the provisions of this title.
601 [(85)] (86) "Insurance consultant" or "consultant" means a person who:
602 (a) advises [other persons] another person about insurance needs and coverages;
603 (b) is compensated by the person advised on a basis not directly related to the insurance
604 placed; and
605 (c) except as provided in Section 31A-23a-501 , is not compensated directly or
606 indirectly by an insurer or producer for advice given.
607 [(86)] (87) "Insurance holding company system" means a group of two or more
608 affiliated persons, at least one of whom is an insurer.
609 [(87)] (88) (a) "Insurance producer" or "producer" means a person licensed or required
610 to be licensed under the laws of this state to sell, solicit, or negotiate insurance.
611 (b) With regards to the selling, soliciting, or negotiating of an insurance product to an
612 insurance customer or an insured:
613 (i) "producer for the insurer" means a producer who is compensated directly or
614 indirectly by an insurer for selling, soliciting, or negotiating [any] a product of that insurer; and
615 (ii) "producer for the insured" means a producer who:
616 (A) is compensated directly and only by an insurance customer or an insured; and

617 (B) receives no compensation directly or indirectly from an insurer for selling,
618 soliciting, or negotiating [any] a product of that insurer to an insurance customer or insured.
619 [(88)] (89) (a) "Insured" means a person to whom or for whose benefit an insurer
620 makes a promise in an insurance policy and includes:
621 (i) [policyholders] a policyholder;
622 (ii) [subscribers] a subscriber;
623 (iii) [members] a member; and
624 (iv) [beneficiaries] a beneficiary.
625 (b) The definition in Subsection [(88)] (89)(a):
626 (i) applies only to this title; and
627 (ii) does not define the meaning of this word as used in an insurance [policies or
628 certificates] policy or certificate.
629 [(89)] (90) (a) (i) "Insurer" means [any] a person doing an insurance business as a
630 principal including:
631 (A) a fraternal benefit [societies] society;
632 (B) [issuers of gift annuities other than those] an issuer of a gift annuity other than an
633 annuity specified in Subsections 31A-22-1305 (2) and (3);
634 (C) a motor [clubs] club;
635 (D) an employee welfare [plans] plan; and
636 (E) [any] a person purporting or intending to do an insurance business as a principal on
637 that person's own account.
638 (ii) "Insurer" does not include a governmental entity to the extent [it] the governmental
639 entity is engaged in [the activities] an activity described in Section 31A-12-107 .
640 (b) "Admitted insurer" is defined in Subsection [(161)] (163)(b).
641 (c) "Alien insurer" is defined in Subsection (7).
642 (d) "Authorized insurer" is defined in Subsection [(161)] (163)(b).
643 (e) "Domestic insurer" is defined in Subsection (48).
644 (f) "Foreign insurer" is defined in Subsection [(64)] (65).
645 (g) "Nonadmitted insurer" is defined in Subsection [(161)] (163)(a).
646 (h) "Unauthorized insurer" is defined in Subsection [(161)] (163)(a).
647 [(90)] (91) "Interinsurance exchange" is defined in Subsection [(141)] (142).

648 [(91)] (92) "Involuntary unemployment insurance" means insurance:
649 (a) offered in connection with an extension of credit; and
650 (b) that provides indemnity if the debtor is involuntarily unemployed for payments
651 coming due on a:
652 (i) specific loan; or
653 (ii) credit transaction.
654 [(92)] (93) "Large employer," in connection with a health benefit plan, means an
655 employer who, with respect to a calendar year and to a plan year:
656 (a) employed an average of at least 51 eligible employees on each business day during
657 the preceding calendar year; and
658 (b) employs at least two employees on the first day of the plan year.
659 [(93)] (94) "Late enrollee," with respect to an employer health benefit plan, means an
660 individual whose enrollment is a late enrollment.
661 [(94)] (95) "Late enrollment," with respect to an employer health benefit plan, means
662 enrollment of an individual other than:
663 (a) on the earliest date on which coverage can become effective for the individual
664 under the terms of the plan; or
665 (b) through special enrollment.
666 [(95)] (96) (a) Except for a retainer contract or legal assistance described in Section
667 31A-1-103 , "legal expense insurance" means insurance written to indemnify or pay for a
668 specified legal [expenses] expense.
669 (b) "Legal expense insurance" includes [arrangements that create] an arrangement that
670 creates a reasonable [expectations of ] expectation of an enforceable [rights] right.
671 (c) "Legal expense insurance" does not include the provision of, or reimbursement for,
672 legal services incidental to other insurance [coverages] coverage.
673 [(96)] (97) (a) "Liability insurance" means insurance against liability:
674 (i) for death, injury, or disability of [any] a human being, or for damage to property,
675 exclusive of the coverages under:
676 (A) Subsection [(106)] (107) for medical malpractice insurance;
677 (B) Subsection [(133)] (134) for professional liability insurance; and
678 (C) Subsection [(166)] (168) for workers' compensation insurance;

679 (ii) for a medical, hospital, surgical, and funeral [benefits to persons] benefit to a
680 person other than the insured who [are] is injured, irrespective of legal liability of the insured,
681 when issued with or supplemental to insurance against legal liability for the death, injury, or
682 disability of a human [beings] being, exclusive of the coverages under:
683 (A) Subsection [(106)] (107) for medical malpractice insurance;
684 (B) Subsection [(133)] (134) for professional liability insurance; and
685 (C) Subsection [(166)] (168) for workers' compensation insurance;
686 (iii) for loss or damage to property resulting from [accidents to or explosions of boilers,
687 pipes, pressure containers] an accident to or explosion of a boiler, pipe, pressure container,
688 machinery, or apparatus;
689 (iv) for loss or damage to [any] property caused by:
690 (A) the breakage or leakage of [sprinklers, water pipes and containers, or by] a
691 sprinkler, water pipe, or water container; or
692 (B) water entering through [leaks or openings in buildings] a leak or opening in a
693 building; or
694 (v) for other loss or damage properly the subject of insurance not within [any other]
695 another kind [or kinds] of insurance as defined in this chapter, if [such] the insurance is not
696 contrary to law or public policy.
697 (b) "Liability insurance" includes:
698 (i) vehicle liability insurance as defined in Subsection [(163)] (165);
699 (ii) residential dwelling liability insurance as defined in Subsection [(144)] (145); and
700 (iii) making inspection of, and issuing [certificates] a certificate of inspection upon,
701 [elevators, boilers] an elevator, boiler, machinery, [and] or apparatus of any kind when done in
702 connection with insurance on [them] the elevator, boiler, machinery, or apparatus.
703 [(97)] (98) (a) "License" means the authorization issued by the commissioner to engage
704 in [some] an activity that is part of or related to the insurance business.
705 (b) "License" includes [certificates] a certificate of authority issued to [insurers] an
706 insurer.
707 [(98)] (99) (a) "Life insurance" means:
708 (i) insurance on a human [lives] life; and [insurances]
709 (ii) insurance pertaining to or connected with human life.

710 (b) The business of life insurance includes:
711 (i) granting a death [benefits] benefit;
712 (ii) granting an annuity [benefits] benefit;
713 (iii) granting an endowment [benefits] benefit;
714 (iv) granting an additional [benefits] benefit in the event of death by accident;
715 (v) granting an additional [benefits] benefit to safeguard the policy against lapse; and
716 (vi) providing an optional [methods] method of settlement of proceeds.
717 [(99)] (100) "Limited license" means a license that:
718 (a) is issued for a specific product of insurance; and
719 (b) limits an individual or agency to transact only for that product or insurance.
720 [(100)] (101) "Limited line credit insurance" includes the following forms of
721 insurance:
722 (a) credit life;
723 (b) credit accident and health;
724 (c) credit property;
725 (d) credit unemployment;
726 (e) involuntary unemployment;
727 (f) mortgage life;
728 (g) mortgage guaranty;
729 (h) mortgage accident and health;
730 (i) guaranteed automobile protection; and
731 (j) [any other] another form of insurance offered in connection with an extension of
732 credit that:
733 (i) is limited to partially or wholly extinguishing the credit obligation; and
734 (ii) the commissioner determines by rule should be designated as a form of limited line
735 credit insurance.
736 [(101)] (102) "Limited line credit insurance producer" means a person who sells,
737 solicits, or negotiates one or more forms of limited line credit insurance coverage to
738 [individuals] an individual through a master, corporate, group, or individual policy.
739 [(102)] (103) "Limited line insurance" includes:
740 (a) bail bond;

741 (b) limited line credit insurance;
742 (c) legal expense insurance;
743 (d) motor club insurance;
744 (e) rental car-related insurance;
745 (f) travel insurance; and
746 (g) [any other] another form of limited insurance that the commissioner determines by
747 rule should be designated a form of limited line insurance.
748 [(103)] (104) "Limited lines authority" includes:
749 (a) the lines of insurance listed in Subsection [(102)] (103); and
750 (b) a customer service representative.
751 [(104)] (105) "Limited lines producer" means a person who sells, solicits, or negotiates
752 limited lines insurance.
753 [(105)] (106) (a) "Long-term care insurance" means an insurance policy or rider
754 advertised, marketed, offered, or designated to provide coverage:
755 (i) in a setting other than an acute care unit of a hospital;
756 (ii) for not less than 12 consecutive months for [each] a covered person on the basis of:
757 (A) expenses incurred;
758 (B) indemnity;
759 (C) prepayment; or
760 (D) another method;
761 (iii) for one or more necessary or medically necessary services that are:
762 (A) diagnostic;
763 (B) preventative;
764 (C) therapeutic;
765 (D) rehabilitative;
766 (E) maintenance; or
767 (F) personal care; and
768 (iv) that may be issued by:
769 (A) an insurer;
770 (B) a fraternal benefit society;
771 (C) (I) a nonprofit health hospital; and

772 (II) a medical service corporation;
773 (D) a prepaid health plan;
774 (E) a health maintenance organization; or
775 (F) an entity similar to the entities described in Subsections [(105)] (106)(a)(iv)(A)
776 through (E) to the extent that the entity is otherwise authorized to issue life or health care
777 insurance.
778 (b) "Long-term care insurance" includes:
779 (i) any of the following that provide directly or supplement long-term care insurance:
780 (A) a group or individual annuity or rider; or
781 (B) a life insurance policy or rider;
782 (ii) a policy or rider that provides for payment of benefits [based on] on the basis of:
783 (A) cognitive impairment; or
784 (B) functional capacity; or
785 (iii) a qualified long-term care insurance contract.
786 (c) "Long-term care insurance" does not include:
787 (i) a policy that is offered primarily to provide basic Medicare supplement coverage;
788 (ii) basic hospital expense coverage;
789 (iii) basic medical/surgical expense coverage;
790 (iv) hospital confinement indemnity coverage;
791 (v) major medical expense coverage;
792 (vi) income replacement or related asset-protection coverage;
793 (vii) accident only coverage;
794 (viii) coverage for a specified:
795 (A) disease; or
796 (B) accident;
797 (ix) limited benefit health coverage; or
798 (x) a life insurance policy that accelerates the death benefit to provide the option of a
799 lump sum payment:
800 (A) if the following are not conditioned on the receipt of long-term care:
801 (I) benefits; or
802 (II) eligibility; and

803 (B) the coverage is for one or more the following qualifying events:
804 (I) terminal illness;
805 (II) medical conditions requiring extraordinary medical intervention; or
806 (III) permanent institutional confinement.
807 [(106)] (107) "Medical malpractice insurance" means insurance against legal liability
808 incident to the practice and provision of a medical [services] service other than the practice and
809 provision of a dental [services] service.
810 [(107)] (108) "Member" means a person having membership rights in an insurance
811 corporation.
812 [(108)] (109) "Minimum capital" or "minimum required capital" means the capital that
813 must be constantly maintained by a stock insurance corporation as required by statute.
814 [(109)] (110) "Mortgage accident and health insurance" means insurance offered in
815 connection with an extension of credit that provides indemnity for payments coming due on a
816 mortgage while the debtor is disabled.
817 [(110)] (111) "Mortgage guaranty insurance" means surety insurance under which
818 [mortgagees and other creditors are] a mortgagee or other creditor is indemnified against losses
819 caused by the default of [debtors] a debtor.
820 [(111)] (112) "Mortgage life insurance" means insurance on the life of a debtor in
821 connection with an extension of credit that pays if the debtor dies.
822 [(112)] (113) "Motor club" means a person:
823 (a) licensed under:
824 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
825 (ii) Chapter 11, Motor Clubs; or
826 (iii) Chapter 14, Foreign Insurers; and
827 (b) that promises for an advance consideration to provide for a stated period of time
828 one or more:
829 (i) legal services under Subsection 31A-11-102 (1)(b);
830 (ii) bail services under Subsection 31A-11-102 (1)(c); or
831 (iii) (A) trip reimbursement;
832 (B) towing services;
833 (C) emergency road services;

834 (D) stolen automobile services;
835 (E) a combination of the services listed in Subsections [(112)] (113)(b)(iii)(A) through
836 (D); or
837 (F) [any] other services given in Subsections 31A-11-102 (1)(b) through (f).
838 [(113)] (114) "Mutual" means a mutual insurance corporation.
839 [(114)] (115) "Network plan" means health care insurance:
840 (a) that is issued by an insurer; and
841 (b) under which the financing and delivery of medical care is provided, in whole or in
842 part, through a defined set of providers under contract with the insurer, including the financing
843 and delivery of [items] an item paid for as medical care.
844 [(115)] (116) "Nonparticipating" means a plan of insurance under which the insured is
845 not entitled to receive [dividends] a dividend representing [shares] a share of the surplus of the
846 insurer.
847 [(116)] (117) "Ocean marine insurance" means insurance against loss of or damage to:
848 (a) ships or hulls of ships;
849 (b) goods, freight, cargoes, merchandise, effects, disbursements, profits, moneys,
850 securities, choses in action, evidences of debt, valuable papers, bottomry, respondentia
851 interests, or other cargoes in or awaiting transit over the oceans or inland waterways;
852 (c) earnings such as freight, passage money, commissions, or profits derived from
853 transporting goods or people upon or across the oceans or inland waterways; or
854 (d) a vessel owner or operator as a result of liability to employees, passengers, bailors,
855 owners of other vessels, owners of fixed objects, customs or other authorities, or other persons
856 in connection with maritime activity.
857 [(117)] (118) "Order" means an order of the commissioner.
858 [(118)] (119) "Outline of coverage" means a summary that explains an accident and
859 health insurance policy.
860 [(119)] (120) "Participating" means a plan of insurance under which the insured is
861 entitled to receive [dividends] a dividend representing [shares] a share of the surplus of the
862 insurer.
863 [(120)] (121) "Participation," as used in a health benefit plan, means a requirement
864 relating to the minimum percentage of eligible employees that must be enrolled in relation to

865 the total number of eligible employees of an employer reduced by each eligible employee who
866 voluntarily declines coverage under the plan because the employee:
867 (a) has other group health care insurance coverage[.]; or
868 (b) receives:
869 (i) Medicare, under the Health Insurance for the Aged Act, Title XVIII of the Social
870 Security Amendments of 1965; or
871 (ii) another government health benefit.
872 [(121)] (122) "Person" includes:
873 (a) an individual[,];
874 (b) a partnership[,];
875 (c) a corporation[,];
876 (d) an incorporated or unincorporated association[,];
877 (e) a joint stock company[,];
878 (f) a trust[,];
879 (g) a limited liability company[,];
880 (h) a reciprocal[,];
881 (i) a syndicate[,]; or [any]
882 (j) another similar entity or combination of entities acting in concert.
883 [(122)] (123) "Personal lines insurance" means property and casualty insurance
884 coverage sold for primarily noncommercial purposes to:
885 (a) [individuals; and] an individual; or
886 (b) [families] a family.
887 [(123)] (124) "Plan sponsor" is as defined in 29 U.S.C. Sec. 1002(16)(B).
888 [(124)] (125) "Plan year" means:
889 (a) the year that is designated as the plan year in:
890 (i) the plan document of a group health plan; or
891 (ii) a summary plan description of a group health plan;
892 (b) if the plan document or summary plan description does not designate a plan year or
893 there is no plan document or summary plan description:
894 (i) the year used to determine deductibles or limits;
895 (ii) the policy year, if the plan does not impose deductibles or limits on a yearly basis;

896 or
897 (iii) the employer's taxable year if:
898 (A) the plan does not impose deductibles or limits on a yearly basis; and
899 (B) (I) the plan is not insured; or
900 (II) the insurance policy is not renewed on an annual basis; or
901 (c) in a case not described in Subsection [(124)] (125)(a) or (b), the calendar year.
902 [(125)] (126) (a) "Policy" means [any] a document, including any attached
903 [endorsements and riders, purporting] endorsement or application that:
904 (i) purports to be an enforceable contract[, which]; and
905 (ii) memorializes in writing some or all of the terms of an insurance contract.
906 (b) "Policy" includes a service contract issued by:
907 (i) a motor club under Chapter 11, Motor Clubs;
908 (ii) a service contract provided under Chapter 6a, Service Contracts; and
909 (iii) a corporation licensed under:
910 (A) Chapter 7, Nonprofit Health Service Insurance Corporations; or
911 (B) Chapter 8, Health Maintenance Organizations and Limited Health Plans.
912 (c) "Policy" does not include:
913 (i) a certificate under a group insurance contract; or
914 (ii) a document that does not purport to have legal effect.
915 [(126)] (127) "Policyholder" means the person who controls a policy, binder, or oral
916 contract by ownership, premium payment, or otherwise.
917 [(127)] (128) "Policy illustration" means a presentation or depiction that includes
918 nonguaranteed elements of a policy of life insurance over a period of years.
919 [(128)] (129) "Policy summary" means a synopsis describing the elements of a life
920 insurance policy.
921 [(129)] (130) "Preexisting condition," with respect to a health benefit plan:
922 (a) means a condition that was present before the effective date of coverage, whether or
923 not [any] medical advice, diagnosis, care, or treatment was recommended or received before
924 that day; and
925 (b) does not include a condition indicated by genetic information unless an actual
926 diagnosis of the condition by a physician has been made.

927 [(130)] (131) (a) "Premium" means the monetary consideration for an insurance policy.
928 (b) "Premium" includes, however designated:
929 (i) [assessments] an assessment;
930 (ii) a membership [fees] fee;
931 (iii) a required [contributions] contribution; or
932 (iv) monetary consideration.
933 (c) (i) [Consideration] "Premium" does not include consideration paid to a third party
934 [administrators for their services is not "premium."] administrator for the third party
935 administrator's services.
936 (ii) [Amounts] "Premium" includes an amount paid by a third party [administrators to
937 insurers] administrator to an insurer for insurance on the risks administered by the third party
938 [administrators are "premium."] administrator.
939 [(131)] (132) "Principal officers" of a corporation means the officers designated under
940 Subsection 31A-5-203 (3).
941 [(132) "Proceedings"] (133) "Proceeding" includes [actions and] an action or special
942 statutory [proceedings] proceeding.
943 [(133)] (134) "Professional liability insurance" means insurance against legal liability
944 incident to the practice of a profession and provision of [any] a professional [services] service.
945 [(134)] (135) (a) Except as provided in Subsection [(134)] (135)(b), "property
946 insurance" means insurance against loss or damage to real or personal property of every kind
947 and any interest in that property:
948 (i) from all hazards or causes; and
949 (ii) against loss consequential upon the loss or damage including vehicle
950 comprehensive and vehicle physical damage coverages.
951 (b) "Property insurance" does not include:
952 (i) inland marine insurance as defined in Subsection [(80)] (81); and
953 (ii) ocean marine insurance as defined under Subsection [(116)] (117).
954 [(135)] (136) "Qualified long-term care insurance contract" or "federally tax qualified
955 long-term care insurance contract" means:
956 (a) an individual or group insurance contract that meets the requirements of Section
957 7702B(b), Internal Revenue Code; or

958 (b) the portion of a life insurance contract that provides long-term care insurance:
959 (i) (A) by rider; or
960 (B) as a part of the contract; and
961 (ii) that satisfies the requirements of Sections 7702B(b) and (e), Internal Revenue
962 Code.
963 [(136)] (137) "Qualified United States financial institution" means an institution that:
964 (a) is:
965 (i) organized under the laws of the United States or any state; or
966 (ii) in the case of a United States office of a foreign banking organization, licensed
967 under the laws of the United States or any state;
968 (b) is regulated, supervised, and examined by a United States federal or state
969 [authorities] authority having regulatory authority over [banks and trust companies] a bank or
970 trust company; and
971 (c) meets the standards of financial condition and standing that are considered
972 necessary and appropriate to regulate the quality of a financial [institutions] institution whose
973 letters of credit will be acceptable to the commissioner as determined by:
974 (i) the commissioner by rule; or
975 (ii) the Securities Valuation Office of the National Association of Insurance
976 Commissioners.
977 [(137)] (138) (a) "Rate" means:
978 (i) the cost of a given unit of insurance; or
979 (ii) for property-casualty insurance, that cost of insurance per exposure unit either
980 expressed as:
981 (A) a single number; or
982 (B) a pure premium rate, adjusted before [any] the application of individual risk
983 variations based on loss or expense considerations to account for the treatment of:
984 (I) expenses;
985 (II) profit; and
986 (III) individual insurer variation in loss experience.
987 (b) "Rate" does not include a minimum premium.
988 [(138)] (139) (a) Except as provided in Subsection [(138)] (139)(b), "rate service

989 organization" means [any] a person who assists [insurers] an insurer in rate making or filing by:
990 (i) collecting, compiling, and furnishing loss or expense statistics;
991 (ii) recommending, making, or filing rates or supplementary rate information; or
992 (iii) advising about rate questions, except as an attorney giving legal advice.
993 (b) "Rate service organization" does not mean:
994 (i) an employee of an insurer;
995 (ii) a single insurer or group of insurers under common control;
996 (iii) a joint underwriting group; or
997 (iv) a natural person serving as an actuarial or legal consultant.
998 [(139)] (140) "Rating manual" means any of the following used to determine initial and
999 renewal policy premiums:
1000 (a) a manual of rates;
1001 (b) [classifications] a classification;
1002 (c) a rate-related underwriting [rules] rule; and
1003 (d) a rating [formulas that describe] formula that describes steps, policies, and
1004 procedures for determining initial and renewal policy premiums.
1005 [(140)] (141) "Received by the department" means:
1006 (a) except as provided in Subsection [(140)] (141)(b), the date delivered to and
1007 stamped received by the department, whether delivered:
1008 (i) in person; or
1009 (ii) electronically; and
1010 (b) if delivered to the department by a delivery service, the delivery service's postmark
1011 date or pick-up date unless otherwise stated in:
1012 (i) statute;
1013 (ii) rule; or
1014 (iii) a specific filing order.
1015 [(141)] (142) "Reciprocal" or "interinsurance exchange" means [any] an
1016 unincorporated association of persons:
1017 (a) operating through an attorney-in-fact common to all of [them] the persons; and
1018 (b) exchanging insurance contracts with one another that provide insurance coverage
1019 on each other.

1020 [(142)] (143) "Reinsurance" means an insurance transaction where an insurer, for
1021 consideration, transfers any portion of the risk it has assumed to another insurer. In referring to
1022 reinsurance transactions, this title sometimes refers to:
1023 (a) the insurer transferring the risk as the "ceding insurer"; and
1024 (b) the insurer assuming the risk as the:
1025 (i) "assuming insurer"; or
1026 (ii) "assuming reinsurer."
1027 [(143)] (144) "Reinsurer" means [any] a person licensed in this state as an insurer with
1028 the authority to assume reinsurance.
1029 [(144)] (145) "Residential dwelling liability insurance" means insurance against
1030 liability resulting from or incident to the ownership, maintenance, or use of a residential
1031 dwelling that is a detached single family residence or multifamily residence up to four units.
1032 [(145)] (146) (a) "Retrocession" means reinsurance with another insurer of a liability
1033 assumed under a reinsurance contract.
1034 (b) A reinsurer "retrocedes" when [it] the reinsurer reinsures with another insurer part
1035 of a liability assumed under a reinsurance contract.
1036 [(146)] (147) "Rider" means an endorsement to:
1037 (a) an insurance policy; or
1038 (b) an insurance certificate.
1039 [(147)] (148) (a) "Security" means [any] a:
1040 (i) note;
1041 (ii) stock;
1042 (iii) bond;
1043 (iv) debenture;
1044 (v) evidence of indebtedness;
1045 (vi) certificate of interest or participation in [any] a profit-sharing agreement;
1046 (vii) collateral-trust certificate;
1047 (viii) preorganization certificate or subscription;
1048 (ix) transferable share;
1049 (x) investment contract;
1050 (xi) voting trust certificate;

1051 (xii) certificate of deposit for a security;
1052 (xiii) certificate of interest of participation in an oil, gas, or mining title or lease or in
1053 payments out of production under such a title or lease;
1054 (xiv) commodity contract or commodity option;
1055 (xv) certificate of interest or participation in, temporary or interim certificate for, receipt
1056 for, guarantee of, or warrant or right to subscribe to or purchase any of the items listed in
1057 Subsections [(147)] (148)(a)(i) through (xiv); or
1058 (xvi) [other] another interest or instrument commonly known as a security.
1059 (b) "Security" does not include:
1060 (i) any of the following under which an insurance company promises to pay money in a
1061 specific lump sum or periodically for life or some other specified period:
1062 (A) insurance;
1063 (B) endowment policy; or
1064 (C) annuity contract; or
1065 (ii) a burial certificate or burial contract.
1066 (149) "Secondary medical condition" means a complication related to an exclusion
1067 from coverage in accident and health insurance.
1068 [(148)] (150) "Self-insurance" means [any] an arrangement under which a person
1069 provides for spreading its own risks by a systematic plan.
1070 (a) Except as provided in this Subsection [(148)] (150), "self-insurance" does not
1071 include an arrangement under which a number of persons spread their risks among themselves.
1072 (b) "Self-insurance" includes:
1073 (i) an arrangement by which a governmental entity undertakes to indemnify [its
1074 employees] an employee for liability arising out of the [employees'] employee's employment;
1075 and
1076 (ii) an arrangement by which a person with a managed program of self-insurance and
1077 risk management undertakes to indemnify its affiliates, subsidiaries, directors, officers, or
1078 employees for liability or risk which is related to the relationship or employment.
1079 (c) "Self-insurance" does not include [any] an arrangement with an independent
1080 [contractors] contractor.
1081 [(149)] (151) "Sell" means to exchange a contract of insurance:

1082 (a) by any means;
1083 (b) for money or its equivalent; and
1084 (c) on behalf of an insurance company.
1085 [(150)] (152) "Short-term care insurance" means [any] an insurance policy or rider
1086 advertised, marketed, offered, or designed to provide coverage that is similar to long-term care
1087 insurance, but that provides coverage for less than 12 consecutive months for each covered
1088 person.
1089 [(151)] (153) "Significant break in coverage" means a period of 63 consecutive days
1090 during each of which an individual does not have [any] creditable coverage.
1091 [(152)] (154) "Small employer," in connection with a health benefit plan, means an
1092 employer who, with respect to a calendar year and to a plan year:
1093 (a) employed an average of at least two employees but not more than 50 eligible
1094 employees on each business day during the preceding calendar year; and
1095 (b) employs at least two employees on the first day of the plan year.
1096 [(153)] (155) "Special enrollment period," in connection with a health benefit plan, has
1097 the same meaning as provided in federal regulations adopted pursuant to the Health Insurance
1098 Portability and Accountability Act of 1996, Pub. L. No. 104-191, 110 Stat. 1936.
1099 [(154)] (156) (a) "Subsidiary" of a person means an affiliate controlled by that person
1100 either directly or indirectly through one or more affiliates or intermediaries.
1101 (b) "Wholly owned subsidiary" of a person is a subsidiary of which all of the voting
1102 shares are owned by that person either alone or with its affiliates, except for the minimum
1103 number of shares the law of the subsidiary's domicile requires to be owned by directors or
1104 others.
1105 [(155)] (157) Subject to Subsection [(82)] (83)(b), "surety insurance" includes:
1106 (a) a guarantee against loss or damage resulting from the failure of [principals] a
1107 principal to pay or perform [their] the principal's obligations to a creditor or other obligee;
1108 (b) bail bond insurance; and
1109 (c) fidelity insurance.
1110 [(156)] (158) (a) "Surplus" means the excess of assets over the sum of paid-in capital
1111 and liabilities.
1112 (b) (i) "Permanent surplus" means the surplus of a mutual insurer that [has been] is

1113 designated by the insurer as permanent.
1114 (ii) Sections 31A-5-211 , 31A-7-201 , 31A-8-209 , 31A-9-209 , and 31A-14-209 require
1115 that mutuals doing business in this state maintain specified minimum levels of permanent
1116 surplus.
1117 (iii) Except for assessable mutuals, the minimum permanent surplus requirement is
1118 essentially the same as the minimum required capital requirement that applies to stock insurers.
1119 (c) "Excess surplus" means:
1120 (i) for [life or accident and health insurers, health organizations, and property and
1121 casualty insurers] a life insurer, accident and health insurer, health organization, or property
1122 and casualty insurer as defined in Section 31A-17-601 , the lesser of:
1123 (A) that amount of an insurer's or health organization's total adjusted capital, as defined
1124 in Subsection [(159)] (161), that exceeds the product of:
1125 (I) 2.5; and
1126 (II) the sum of the insurer's or health organization's minimum capital or permanent
1127 surplus required under Section 31A-5-211 , 31A-9-209 , or 31A-14-205 ; or
1128 (B) that amount of an insurer's or health organization's total adjusted capital, as defined
1129 in Subsection [(159)] (161), that exceeds the product of:
1130 (I) 3.0; and
1131 (II) the authorized control level RBC as defined in Subsection 31A-17-601 (8)(a); and
1132 (ii) for [monoline mortgage guaranty insurers, financial guaranty insurers, and title
1133 insurers,] a monoline mortgage guaranty insurer, financial guaranty insurer, or title insurer that
1134 amount of an insurer's paid-in-capital and surplus that exceeds the product of:
1135 (A) 1.5; and
1136 (B) the insurer's total adjusted capital required by Subsection 31A-17-609 (1).
1137 [(157)] (159) "Third party administrator" or "administrator" means [any] a person who
1138 collects charges or premiums from, or who, for consideration, adjusts or settles claims of
1139 residents of the state in connection with insurance coverage, annuities, or service insurance
1140 coverage, except:
1141 (a) a union on behalf of its members;
1142 (b) a person administering [any] a:
1143 (i) pension plan subject to the federal Employee Retirement Income Security Act of

1144 1974;
1145 (ii) governmental plan as defined in Section 414(d), Internal Revenue Code; or
1146 (iii) nonelecting church plan as described in Section 410(d), Internal Revenue Code;
1147 (c) an employer on behalf of the employer's employees or the employees of one or
1148 more of the subsidiary or affiliated corporations of the employer;
1149 (d) an insurer licensed under Chapter 5, 7, 8, 9, or 14, but only for a line of insurance
1150 for which the insurer holds a license in this state; or
1151 (e) a person:
1152 (i) licensed or exempt from licensing under:
1153 (A) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
1154 Reinsurance Intermediaries; or
1155 (B) Chapter 26, Insurance Adjusters; and
1156 (ii) whose activities are limited to those authorized under the license the person holds
1157 or for which the person is exempt.
1158 [(158)] (160) "Title insurance" means the insuring, guaranteeing, or indemnifying of
1159 [owners] an owner of real or personal property or the [holders] holder of liens or encumbrances
1160 on that property, or others interested in the property against loss or damage suffered by reason
1161 of liens or encumbrances upon, defects in, or the unmarketability of the title to the property, or
1162 invalidity or unenforceability of any liens or encumbrances on the property.
1163 [(159)] (161) "Total adjusted capital" means the sum of an insurer's or health
1164 organization's statutory capital and surplus as determined in accordance with:
1165 (a) the statutory accounting applicable to the annual financial statements required to be
1166 filed under Section 31A-4-113 ; and
1167 (b) [any other items] another item provided by the RBC instructions, as RBC
1168 instructions is defined in Section 31A-17-601 .
1169 [(160)] (162) (a) "Trustee" means "director" when referring to the board of directors of
1170 a corporation.
1171 (b) "Trustee," when used in reference to an employee welfare fund, means an
1172 individual, firm, association, organization, joint stock company, or corporation, whether acting
1173 individually or jointly and whether designated by that name or any other, that is charged with
1174 or has the overall management of an employee welfare fund.

1175 [(161)] (163) (a) "Unauthorized insurer," "unadmitted insurer," or "nonadmitted
1176 insurer" means an insurer:
1177 (i) not holding a valid certificate of authority to do an insurance business in this state;
1178 or
1179 (ii) transacting business not authorized by a valid certificate.
1180 (b) "Admitted insurer" or "authorized insurer" means an insurer:
1181 (i) holding a valid certificate of authority to do an insurance business in this state; and
1182 (ii) transacting business as authorized by a valid certificate.
1183 [(162)] (164) "Underwrite" means the authority to accept or reject risk on behalf of the
1184 insurer.
1185 [(163)] (165) "Vehicle liability insurance" means insurance against liability resulting
1186 from or incident to ownership, maintenance, or use of [any] a land vehicle or aircraft, exclusive
1187 of a vehicle comprehensive [and] or vehicle physical damage [coverages] coverage under
1188 Subsection [(134)] (135).
1189 [(164)] (166) "Voting security" means a security with voting rights, and includes [any]
1190 a security convertible into a security with a voting right associated with the security.
1191 [(165)] (167) "Waiting period" for a health benefit plan means the period that must
1192 pass before coverage for an individual, who is otherwise eligible to enroll under the terms of
1193 the health benefit plan, can become effective.
1194 [(166)] (168) "Workers' compensation insurance" means:
1195 (a) insurance for indemnification of [employers] an employer against liability for
1196 compensation based on:
1197 (i) a compensable accidental [injuries] injury; and
1198 (ii) occupational disease disability;
1199 (b) employer's liability insurance incidental to workers' compensation insurance and
1200 written in connection with workers' compensation insurance; and
1201 (c) insurance assuring to [the persons] a person entitled to workers' compensation
1202 benefits the compensation provided by law.
1203 Section 2. Section 31A-2-203 is amended to read:
1204 31A-2-203. Examinations and alternatives.
1205 (1) (a) Whenever the commissioner [considers it necessary in order to inform the

1206 commissioner about any] determines that information is needed about a matter related to the
1207 enforcement of this title, the commissioner may examine the affairs and condition of:
1208 (i) a licensee under this title;
1209 (ii) an applicant for a license under this title;
1210 (iii) a person or organization of persons doing or in process of organizing to do an
1211 insurance business in this state; or
1212 (iv) a person who is not, but should be, licensed under this title.
1213 (b) When reasonably necessary for an examination under Subsection (1)(a), the
1214 commissioner may examine:
1215 (i) so far as [they relate] it relates to the examinee, [the accounts, records, documents,
1216 or evidences of transactions] an account, record, document, or evidence of a transaction of:
1217 (A) the insurer or other licensee;
1218 (B) [any] an officer or other person who has executive authority over or is in charge of
1219 any segment of the examinee's affairs; or
1220 (C) [any] an affiliate of the examinee; or
1221 (ii) [any] a third party model or product used by the examinee.
1222 (c) (i) On demand, [each] an examinee under Subsection (1)(a) shall make available to
1223 the commissioner for examination:
1224 (A) [any of] the examinee's own [accounts, records, files, documents, or evidences of
1225 transactions] account, record, file, document, or evidence of a transaction; and
1226 (B) to the extent reasonably necessary for an examination, [the accounts, records, files,
1227 documents, or evidences of transactions of any persons] an account, record, file, document, or
1228 evidence of a transaction of a person described under Subsection (1)(b).
1229 (ii) Except as provided in Subsection (1)(c)(iii), failure to make [the documents] an
1230 item described in Subsection (1)(c)(i) available is concealment of records under Subsection
1231 31A-27a-207 (1)(e).
1232 (iii) If the examinee is unable to obtain [accounts, records, files, documents, or
1233 evidences of transactions from persons] an account, record, file, document, or evidence of a
1234 transaction from a person described under Subsection (1)(b), that failure is not concealment of
1235 records if the examinee immediately terminates the relationship with the other person.
1236 (d) (i) Neither the commissioner nor an examiner may remove [any] an account,

1237 record, file, document, evidence of a transaction, or other property of the examinee from the
1238 examinee's offices unless:
1239 (A) the examinee consents in writing; or
1240 (B) a court grants permission.
1241 (ii) The commissioner may make and remove [copies or abstracts] a copy or abstract of
1242 the following described in Subsection (1)(d)(i):
1243 (A) an account;
1244 (B) a record;
1245 (C) a file;
1246 (D) a document;
1247 (E) evidence of a transaction; or
1248 (F) other property.
1249 (2) (a) Subject to the other provisions of this section, the commissioner shall examine
1250 as needed and as otherwise provided by law:
1251 (i) every insurer, both domestic and nondomestic;
1252 (ii) every licensed rate service organization; and
1253 (iii) any other licensee.
1254 (b) The commissioner shall examine [insurers] an insurer, both domestic and
1255 nondomestic, no less frequently than once every five years, but the commissioner may use in
1256 lieu [examinations] an examination under Subsection (4) to satisfy this requirement.
1257 (c) The commissioner shall revoke the certificate of authority of an insurer or the
1258 license of a rate service organization that has not been examined, or submitted an acceptable in
1259 lieu report under Subsection (4), within the past five years.
1260 (d) (i) Any 25 persons who are policyholders, shareholders, or creditors of a domestic
1261 insurer may by verified petition demand a hearing under Section 31A-2-301 to determine
1262 whether the commissioner should conduct an unscheduled examination of the insurer.
1263 (ii) Persons demanding the hearing under this Subsection (2)(d) shall be given an
1264 opportunity in the hearing to present evidence that an examination of the insurer is necessary.
1265 (iii) If the evidence justifies an examination, the commissioner shall order an
1266 examination.
1267 (e) (i) [When] If the board of directors of a domestic insurer requests that the

1268 commissioner examine the insurer, the commissioner shall examine the insurer as soon as
1269 reasonably possible.
1270 (ii) If the examination requested under this Subsection (2)(e) is conducted within two
1271 years after completion of a comprehensive examination by the commissioner, costs of the
1272 requested examination may not be deducted from premium taxes under Section 59-9-102
1273 unless the commissioner's order specifically provides for the deduction.
1274 (f) [Bail] A bail bond surety [companies] company, as defined in Section 31A-35-102 ,
1275 [are exempted] is exempt from:
1276 (i) the five-year examination requirement in Subsection (2)(b);
1277 (ii) the revocation under Subsection (2)(c); and
1278 (iii) Subsections (2)(d) and (2)(e).
1279 (3) (a) The commissioner may order an independent audit or examination by one or
1280 more technical experts, including a certified public [accountants and actuaries] accountant or
1281 actuary:
1282 (i) in lieu of all or part of an examination under Subsection (1) or (2); or
1283 (ii) in addition to an examination under Subsection (1) or (2).
1284 (b) [Any] An audit or evaluation under this Subsection (3) is subject to Subsection (5),
1285 Section 31A-2-204 , and Subsection 31A-2-205 (4).
1286 (4) (a) In lieu of all or [any] a part of an examination under this section, the
1287 commissioner may accept the report of an examination made by:
1288 (i) the insurance department of another state; or
1289 (ii) another government agency in:
1290 (A) this state;
1291 (B) the federal government; or
1292 (C) another state.
1293 (b) An examination by the commissioner under Subsection (1) or (2) or accepted by the
1294 commissioner under this Subsection (4) may use:
1295 (i) an audit already made by a certified public accountant; or
1296 (ii) an actuarial evaluation made by an actuary approved by the commissioner.
1297 (5) (a) An examination may be comprehensive or limited with respect to the
1298 examinee's affairs and condition. The commissioner shall determine the nature and scope of

1299 each examination, taking into account all relevant factors, including:
1300 (i) the length of time the examinee has been licensed in this state;
1301 (ii) the nature of the business being examined;
1302 (iii) the nature of the accounting or other records available;
1303 (iv) one or more reports from:
1304 (A) independent auditors; and
1305 (B) self-certification entities; and
1306 (v) the nature of examinations performed elsewhere.
1307 (b) The examination of an alien insurer [shall be] is limited to one or more insurance
1308 transactions and assets in the United States, unless the commissioner orders otherwise after
1309 finding that extraordinary circumstances necessitate a broader examination.
1310 (6) To effectively administer this section, the commissioner:
1311 (a) shall:
1312 (i) maintain one or more effective financial condition and market regulation
1313 surveillance systems including:
1314 (A) financial and market analysis; and
1315 (B) a review of insurance regulatory information system reports;
1316 (ii) employ a priority scheduling method that focuses on insurers and other licensees
1317 most in need of examination; and
1318 (iii) use examination management techniques similar to those outlined in the Financial
1319 Condition Examination Handbook of the National Association of Insurance Commissioners;
1320 and
1321 (b) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act,
1322 may make rules pertaining to [the] a financial condition and market regulation surveillance
1323 [systems] system.
1324 Section 3. Section 31A-2-403 is amended to read:
1325 31A-2-403. Title and Escrow Commission created.
1326 (1) H. [ [ ] (a) [ ] ] [ There ] Subject to Subsection (1)(b), there .H is created within the
1326a department the Title and Escrow Commission that
1327 is comprised of five members appointed by the governor with the consent of the Senate as
1328 follows:
1329 H. [ [ ] (i) [ ] ] [ (a) ] .H four members shall each:

1330 H. [ [ ] (A) [ ] ] [ (i) ] .H be or have been licensed under the title insurance line of
1330a authority; [and]
1331 H. [ [ ] (B) [ ] ] [ (ii) ] .H as of the day on which the member is appointed, be or have
1331a been licensed
1332 with the search or escrow subline of authority for at least five years; and
1333 H. [ (iii) ] (C) .H as of the day on which the member is appointed, not be from the same
1333a county as
1334 another member appointed under this Subsection (1)(a) H. (i) .H ; and
1335 H. [ [ ] (ii) [ ] ] [ (b) ] .H one member shall be a member of the general public from any
1335a county in the
1336 state.
1337 H. [ [ ] (b) No more than one commission member may be appointed
1337a from [ : ] [ ] ] .H
1338 [(i) any county in the state; or]
1339 H. [ [ ] [ (ii) any ] a single company. [ ] ] .H
1340 (2) (a) Subject to Subsection (2)(c), [each] a member of the commission shall file with
1341 the department a disclosure of any position of employment or ownership interest that the
1342 member of the commission has with respect to [any] a person that is subject to the jurisdiction
1343 of the department.
1344 (b) The disclosure statement required by this Subsection (2) shall be:
1345 (i) filed by no later than the day on which the person begins that person's appointment;
1346 and
1347 (ii) amended when a significant change occurs in any matter required to be disclosed
1348 under this Subsection (2).
1349 (c) A member of the commission is not required to disclose an ownership interest that
1350 the member of the commission has if the ownership interest is held as part of a mutual fund,
1351 trust, or similar investment.
1352 (3) (a) Except as required by Subsection (3)(b), as terms of current commission
1353 members expire, the governor shall appoint each new member to a four-year term ending on
1354 June 30.
1355 (b) Notwithstanding the requirements of Subsection (3)(a), the governor shall, at the
1356 time of appointment, adjust the length of terms to ensure that the terms of the commission
1357 members are staggered so that approximately half of the commission is appointed every two
1358 years.

1359 (c) A commission member may not serve more than one consecutive term.
1360 (d) When a vacancy occurs in the membership for any reason, the governor, with the

1361 consent of the Senate, shall appoint a replacement [shall be appointed] for the unexpired term.
1362 (4) (a) A member of the commission may not receive compensation or benefits for the
1363 member's services, but may receive per diem and expenses incurred in the performance of the
1364 member's official duties at the rates established by the Division of Finance under Sections
1365 63A-3-106 and 63A-3-107 .
1366 (b) A member may decline to receive per diem and expenses for the member's service.
1367 (5) Members of the commission shall annually select one member to serve as chair.
1368 (6) (a) The commission shall meet at least monthly.
1369 (b) The commissioner may call additional meetings:
1370 (i) at the commissioner's discretion;
1371 (ii) upon the request of the chair of the commission; or
1372 (iii) upon the written request of three or more commission members.
1373 (c) (i) Three members of the commission constitute a quorum for the transaction of
1374 business.
1375 (ii) The action of a majority of the members when a quorum is present is the action of
1376 the commission.
1377 (7) The department shall staff the commission.
1378 Section 4. Section 31A-4-102 is amended to read:
1379 31A-4-102. Qualified insurers.
1380 (1) A person may not conduct an insurance business in Utah[, either] in person,
1381 through [agents or brokers, or] an agent, through a broker, through the mail, or [any other]
1382 through another method of communication, except:
1383 (a) an insurer:
1384 (i) authorized to do business in Utah under [Title 31A,] Chapter 5, 7, 8, 9, 10, 11, 13,
1385 or 14[,]; and
1386 (ii) within the limits of its certificate of authority;
1387 (b) a joint underwriting group under Section 31A-2-214 or 31A-20-102 ;
1388 (c) an insurer doing business under Section 31A-15-103 ;
1389 (d) a person who[, pursuant to Section 31A-1-105 ,] submits to the commissioner a
1390 certificate from the United States Department of Labor, or such other evidence as satisfies the
1391 commissioner, that the laws of Utah are preempted with respect to specified activities of that

1392 person by Section 514 of the Employee Retirement Income Security Act of 1974 or other
1393 federal law; or
1394 (e) a person exempt from [the application of the Insurance Code] this title under
1395 Section 31A-1-103 [and all other applicable statutes] or another applicable statute.
1396 (2) As used in this section, "insurer" includes a bail bond surety company, as defined in
1397 Section 31A-35-102 .
1398 Section 5. Section 31A-4-106 is amended to read:
1399 31A-4-106. Provision of health care.
1400 (1) As used in this section, "health care provider" has the same definition as in Section
1401 78-14-3 .
1402 (2) Except under Subsection (3) or (4), unless authorized to do so or employed by
1403 someone authorized to do so under Chapter 5, 7, 8, 9, or 14, a person may not:
1404 (a) directly or indirectly provide health care[, or];
1405 (b) arrange for[,] health care;
1406 (c) manage[,] or administer the provision or arrangement of[,] health care;
1407 (d) collect advance payments for[,] health care; or
1408 (e) compensate [providers] a provider of health care [unless authorized to do so or
1409 employed by someone authorized to do so under Chapter 5, 7, 8, 9, or 14].
1410 (3) Subsection (2) does not apply to:
1411 (a) a natural person or professional corporation that alone or with others professionally
1412 associated with the natural person or professional corporation, and without receiving
1413 consideration for services in advance of the need for a particular service, provides the service
1414 personally with the aid of nonprofessional assistants;
1415 (b) a health care facility as defined in Section 26-21-2 [which] that:
1416 (i) is licensed or exempt from licensing under Title 26, Chapter 21, Health Care
1417 Facility Licensing and Inspection Act; and
1418 (ii) does not engage in health care insurance as defined under Section 31A-1-301 ;
1419 (c) a person who files with the commissioner [under Section 31A-1-105 ] a certificate
1420 from the United States Department of Labor, or other evidence satisfactory to the
1421 commissioner, showing that the laws of Utah are preempted under Section 514 of the
1422 Employee Retirement Income Security Act of 1974 or other federal law;

1423 (d) a person licensed under Chapter 23a, Insurance Marketing - Licensing Producers,
1424 Consultants, and Reinsurance Intermediaries, who [has arranged]:
1425 (i) arranges for the insurance of all services under:
1426 [(i)] (A) Subsection (2) by an insurer authorized to do business in Utah; or
1427 [(ii)] (B) Section 31A-15-103 ; or
1428 [(iii)] (ii) works for an uninsured employer that complies with Chapter 13, Employee
1429 Welfare Funds and Plans; or
1430 (e) an employer that self-funds its obligations to provide health care services or
1431 indemnity for its employees if the employer complies with Chapter 13, Employee Welfare
1432 Funds and Plans.
1433 (4) A person may not provide administrative or management services for [any other]
1434 another person subject to Subsection (2) and not exempt under Subsection (3) unless the
1435 person:
1436 (a) is an authorized insurer under Chapter 5, 7, 8, 9, or 14[,]; or
1437 (b) complies with Chapter 25, Third Party Administrators.
1438 (5) [It is unlawful for any] An insurer or person [providing, administering, or
1439 managing] who provides, administers, or manages health care insurance under Chapter 5, 7, 8,
1440 9, or 14 [to] may not enter into a contract that limits a health care provider's ability to advise
1441 the health care provider's patients or clients fully about treatment options or other issues that
1442 affect the health care of the health care provider's patients or clients.
1443 Section 6. Section 31A-6a-103 is amended to read:
1444 31A-6a-103. Requirements for doing business.
1445 (1) A service contract may not be issued, sold, or offered for sale in this state unless the
1446 service contract is insured under a service contract reimbursement insurance policy issued by:
1447 (a) an insurer authorized to do business in this state; or
1448 (b) a recognized surplus lines carrier.
1449 H. [ (2) A captive insurance company may not write a reimbursement policy for a service
1450 contract provider that is subject to this chapter. ]
1451 [ [ ] (2) [ ] ] [ (3) ] .H (a) A service contract may not be issued, sold, or offered for sale
1451a unless [a true
1452 and correct copy of the service contract and the provider's reimbursement insurance policy have
1453 been filed with the commissioner. A copy of a contract and policy must be filed] the service

1454 contract provider completes the registration process described in this Subsection H. [ (3) ] (2) .H .
1455 (b) To register, a service contract provider shall submit to the department the
1456 following:
1457 (i) an application for registration;
1458 (ii) a fee established in accordance with Section 31A-3-103 ;
1459 (iii) a copy of any service contract that the service contract provider offers in this state;
1460 and
1461 (iv) a copy of the service contract provider's reimbursement insurance policy.
1462 (c) A service provider shall submit the information described in
1462a Subsection H. [ (3) ] (2) .H (b) no
1463 less than 30 days [prior to the issuance, sale offering for sale, or use of the] before the day on
1464 which the service provider issues, sells, offers for sale, or uses a service contract or
1465 reimbursement insurance policy in this state.
1466 [(b) Each] (d) A service provider shall file any modification of the terms of [any] a
1467 service contract or reimbursement insurance policy [must also be filed] 30 days [prior to its
1468 use] before the day on which it is used in this state.
1469 [(c) Persons] (e) A person complying with this chapter [are] is not required to comply
1470 with:
1471 (i) Subsections 31A-21-201 (1) and 31A-23a-402 (3); or
1472 (ii) Chapter 19a, Utah Rate Regulation Act.
1473 H. [ [ ] (3) [ ] ] [ (4) ] .H (a) Premiums collected on a service [contracts] contract are not
1473a subject to
1474 premium taxes.
1475 (b) Premiums collected by [issuers] an issuer of a reimbursement insurance [policies]
1476 policy are subject to premium taxes.
1477 H. [ [ ] . (4) [ ] ] [ (5) ] .H A person marketing, selling, or offering to sell a service
1477a [contracts] contract
1478 for a service contract [providers] provider that complies with this chapter is exempt from the
1479 licensing requirements of this title.
1480 [(5) Service] H. [ (6) ] (5) .H A service contract [providers] provider complying with
1480a this chapter
1481 [are] is not required to comply with:
1482 (a) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
1483 (b) Chapter 7, Nonprofit Health Service Insurance Corporations;
1484 (c) Chapter 8, Health Maintenance Organizations and Limited Health Plans;

1485 (d) Chapter 9, Insurance Fraternals;
1486 (e) Chapter 10, Annuities;
1487 (f) Chapter 11, Motor Clubs;
1488 (g) Chapter 12, State Risk Management Fund;
1489 (h) Chapter 13, Employee Welfare Funds and Plans;
1490 (i) Chapter 14, Foreign Insurers;
1491 (j) Chapter 19a, Utah Rate Regulation Act;
1492 (k) Chapter 25, Third Party Administrators; and
1493 &nb