H.B. 19 Enrolled

1

INSURANCE LAW RELATED AMENDMENTS
2 2011 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: James A. Dunnigan
5 Senate Sponsor: J. Stuart Adams
6
7 LONG TITLE
8 General Description:
9 This bill modifies the Insurance Code and other provisions related to the regulation of
10 insurance and insurance products.
11 Highlighted Provisions:
12 This bill:
13 . amends definitions;
14 . creates the Insurance Department Restricted Account;
15 . addresses fees for captive insurance companies and the cap on the Captive
16 Insurance Restricted Account;
17 . modifies restrictions on foreign title insurers;
18 . removes outdated language;
19 . addresses grace periods for accident and health insurance policies;
20 . modifies provisions related to individuals, group, or blanket accident and health
21 insurance coverage;
22 . addresses health benefit plan offerings;
23 . addresses producer lines of authority;
24 . addresses a written agreement related to a voluntary surrender of a license;
25 . amends provisions related to continuing education;
26 . provides for training related to long-term care insurance;
27 . modifies title insurance agency and producer licensing requirements;
28 . addresses when a title insurance producer may do an escrow involving a real
29 property transaction;

30 . modifies provisions related to disbursements from escrow accounts;
31 . modifies title insurance related assessments;
32 . addresses licensee compensation;
33 . addresses when a person may represent that the person acts in behalf of an insurer;
34 . modifies provisions related to providing the commissioner address, telephone, and
35 email address information;
36 . addresses verification under a nonresident jurisdictional agreement;
37 . addresses per diem and travel expenses of public representatives on the board of
38 directors of the Utah Life and Health Insurance Guaranty Association;
39 . addresses the establishment of classes of business;
40 . modifies rating restrictions;
41 . addresses the renewal of a bail bond surety company license;
42 . permits the commissioner to assign a department employee to engage in certain
43 activities related to the regulation of captive insurance companies;
44 . requires a professional employer organization to notify the commissioner of
45 material changes;
46 . removes the title insurance assessment from the sunset act;
47 . converts certain dedicated credits into several restricted accounts and provides that
48 related appropriations are nonlapsing; and
49 . makes technical and conforming amendments.
50 Money Appropriated in this Bill:
51 None
52 Other Special Clauses:
53 This bill has an effective date.
54 This bill provides for retrospective operation of certain provisions.
55 Utah Code Sections Affected:
56 AMENDS:
57 31A-1-301, as last amended by Laws of Utah 2010, Chapter 10

58 31A-2-208, as last amended by Laws of Utah 2010, Chapter 391
59 31A-2-212, as last amended by Laws of Utah 2007, Chapter 309
60 31A-3-101, as last amended by Laws of Utah 2008, Chapter 382
61 31A-3-103, as last amended by Laws of Utah 2010, Chapter 10
62 31A-3-304, as last amended by Laws of Utah 2010, Chapters 10, 68 and last amended
63 by Coordination Clause, Laws of Utah 2010, Chapter 265
64 31A-14-211, as last amended by Laws of Utah 2003, Chapter 298
65 31A-22-607, as last amended by Laws of Utah 2004, Chapter 329
66 31A-22-610.6, as enacted by Laws of Utah 2008, Chapters 345, 383, and 390
67 31A-22-614.5, as last amended by Laws of Utah 2010, Chapter 357
68 31A-22-618.5, as last amended by Laws of Utah 2010, Chapter 68
69 31A-22-625, as last amended by Laws of Utah 2010, Chapters 10 and 68
70 31A-22-701, as last amended by Laws of Utah 2010, Chapter 10
71 31A-22-716, as last amended by Laws of Utah 2005, Chapter 71
72 31A-22-721, as last amended by Laws of Utah 2004, Chapter 329
73 31A-22-723, as last amended by Laws of Utah 2010, Chapter 68
74 31A-23a-102, as last amended by Laws of Utah 2009, Chapter 349
75 31A-23a-106, as last amended by Laws of Utah 2009, Chapter 349
76 31A-23a-111, as last amended by Laws of Utah 2009, Chapters 349 and 355
77 31A-23a-202, as last amended by Laws of Utah 2009, Chapter 127
78 31A-23a-203, as last amended by Laws of Utah 2009, Chapter 349
79 31A-23a-204, as last amended by Laws of Utah 2009, Chapter 349
80 31A-23a-406, as last amended by Laws of Utah 2007, Chapter 325
81 31A-23a-408, as renumbered and amended by Laws of Utah 2003, Chapter 298
82 31A-23a-412, as renumbered and amended by Laws of Utah 2003, Chapter 298
83 31A-23a-415, as last amended by Laws of Utah 2010, Chapter 10 and last amended by
84 Coordination Clause, Laws of Utah 2010, Chapter 265
85 31A-23a-501, as last amended by Laws of Utah 2010, Chapter 10

86 31A-25-208, as last amended by Laws of Utah 2009, Chapter 349
87 31A-26-206, as last amended by Laws of Utah 2008, Chapter 382
88 31A-26-208, as last amended by Laws of Utah 2008, Chapter 3
89 31A-26-213, as last amended by Laws of Utah 2009, Chapter 349
90 31A-26-306, as last amended by Laws of Utah 2004, Chapter 173
91 31A-28-107, as last amended by Laws of Utah 2010, Chapter 292
92 31A-29-103, as last amended by Laws of Utah 2008, Chapters 3 and 385
93 31A-29-106, as last amended by Laws of Utah 2008, Chapter 382
94 31A-30-103, as last amended by Laws of Utah 2010, Chapter 68
95 31A-30-105, as last amended by Laws of Utah 2010, Chapter 68
96 31A-30-106, as last amended by Laws of Utah 2010, Chapter 68
97 31A-30-106.1, as enacted by Laws of Utah 2010, Chapter 68
98 31A-30-106.5, as last amended by Laws of Utah 2010, Chapter 68
99 31A-30-108, as last amended by Laws of Utah 2008, Chapter 383
100 31A-30-110, as last amended by Laws of Utah 2002, Chapter 308
101 31A-30-112, as last amended by Laws of Utah 2009, Chapter 12
102 31A-31-108, as last amended by Laws of Utah 2010, Chapter 391
103 31A-31-109, as last amended by Laws of Utah 2010, Chapter 391
104 31A-35-202, as last amended by Laws of Utah 2000, Chapter 259
105 31A-35-406, as last amended by Laws of Utah 2010, Chapter 10
106 31A-35-602, as last amended by Laws of Utah 2000, Chapter 259
107 31A-37-103, as last amended by Laws of Utah 2008, Chapter 302
108 31A-37-202, as last amended by Laws of Utah 2009, Chapter 183
109 31A-37-504, as last amended by Laws of Utah 2007, Chapter 309
110 59-9-105, as last amended by Laws of Utah 2002, Chapter 308
111 63I-2-231, as last amended by Laws of Utah 2010, Chapters 68 and 285
112 63J-1-602.2, as enacted by Laws of Utah 2010, Chapter 265 and last amended by
113 Coordination Clause, Laws of Utah 2010, Chapter 265

114 63J-1-602.3, as enacted by Laws of Utah 2010, Chapter 265
115 ENACTS:
116 31A-40-308, Utah Code Annotated 1953
117 Uncodified Material Affected:
118 ENACTS UNCODIFIED MATERIAL
119
120 Be it enacted by the Legislature of the state of Utah:
121 Section 1. Section 31A-1-301 is amended to read:
122 31A-1-301. Definitions.
123 As used in this title, unless otherwise specified:
124 (1) (a) "Accident and health insurance" means insurance to provide protection against
125 economic losses resulting from:
126 (i) a medical condition including:
127 (A) a medical care expense; or
128 (B) the risk of disability;
129 (ii) accident; or
130 (iii) sickness.
131 (b) "Accident and health insurance":
132 (i) includes a contract with disability contingencies including:
133 (A) an income replacement contract;
134 (B) a health care contract;
135 (C) an expense reimbursement contract;
136 (D) a credit accident and health contract;
137 (E) a continuing care contract; and
138 (F) a long-term care contract; and
139 (ii) may provide:
140 (A) hospital coverage;
141 (B) surgical coverage;

142 (C) medical coverage;
143 (D) loss of income coverage;
144 (E) prescription drug coverage;
145 (F) dental coverage; or
146 (G) vision coverage.
147 (c) "Accident and health insurance" does not include workers' compensation insurance.
148 (2) "Actuary" is as defined by the commissioner by rule, made in accordance with Title
149 63G, Chapter 3, Utah Administrative Rulemaking Act.
150 (3) "Administrator" is defined in Subsection [(159)] (161).
151 (4) "Adult" means an individual who has attained the age of at least 18 years.
152 (5) "Affiliate" means a person who controls, is controlled by, or is under common
153 control with, another person. A corporation is an affiliate of another corporation, regardless of
154 ownership, if substantially the same group of individuals manage the corporations.
155 (6) "Agency" means:
156 (a) a person other than an individual, including a sole proprietorship by which an
157 individual does business under an assumed name; and
158 (b) an insurance organization licensed or required to be licensed under Section
159 31A-23a-301 , 31A-25-207 , or 31A-26-209 .
160 (7) "Alien insurer" means an insurer domiciled outside the United States.
161 (8) "Amendment" means an endorsement to an insurance policy or certificate.
162 (9) "Annuity" means an agreement to make periodical payments for a period certain or
163 over the lifetime of one or more individuals if the making or continuance of all or some of the
164 series of the payments, or the amount of the payment, is dependent upon the continuance of
165 human life.
166 (10) "Application" means a document:
167 (a) (i) completed by an applicant to provide information about the risk to be insured;
168 and
169 (ii) that contains information that is used by the insurer to evaluate risk and decide

170 whether to:
171 (A) insure the risk under:
172 (I) the coverage as originally offered; or
173 (II) a modification of the coverage as originally offered; or
174 (B) decline to insure the risk; or
175 (b) used by the insurer to gather information from the applicant before issuance of an
176 annuity contract.
177 (11) "Articles" or "articles of incorporation" means:
178 (a) the original articles;
179 (b) a special law;
180 (c) a charter;
181 (d) an amendment;
182 (e) restated articles;
183 (f) articles of merger or consolidation;
184 (g) a trust instrument;
185 (h) another constitutive document for a trust or other entity that is not a corporation;
186 and
187 (i) an amendment to an item listed in Subsections (11)(a) through (h).
188 (12) "Bail bond insurance" means a guarantee that a person will attend court when
189 required, up to and including surrender of the person in execution of a sentence imposed under
190 Subsection 77-20-7 (1), as a condition to the release of that person from confinement.
191 (13) "Binder" is defined in Section 31A-21-102 .
192 (14) "Blanket insurance policy" means a group policy covering a defined class of
193 persons:
194 (a) without individual underwriting or application; and
195 (b) that is determined by definition [with or] without designating each person covered.
196 (15) "Board," "board of trustees," or "board of directors" means the group of persons
197 with responsibility over, or management of, a corporation, however designated.

198 (16) "Bona fide office" means a physical office in this state:
199 (a) that is open to the public;
200 (b) that is staffed during regular business hours on regular business days; and
201 (c) at which the public may appear in person to obtain services.
202 [(16)] (17) "Business entity" means:
203 (a) a corporation;
204 (b) an association;
205 (c) a partnership;
206 (d) a limited liability company;
207 (e) a limited liability partnership; or
208 (f) another legal entity.
209 [(17)] (18) "Business of insurance" is defined in Subsection [(85)] (87).
210 [(18)] (19) "Business plan" means the information required to be supplied to the
211 commissioner under Subsections 31A-5-204 (2)(i) and (j), including the information required
212 when these subsections apply by reference under:
213 (a) Section 31A-7-201 ;
214 (b) Section 31A-8-205 ; or
215 (c) Subsection 31A-9-205 (2).
216 [(19)] (20) (a) "Bylaws" means the rules adopted for the regulation or management of a
217 corporation's affairs, however designated.
218 (b) "Bylaws" includes comparable rules for a trust or other entity that is not a
219 corporation.
220 [(20)] (21) "Captive insurance company" means:
221 (a) an insurer:
222 (i) owned by another organization; and
223 (ii) whose exclusive purpose is to insure risks of the parent organization and an
224 affiliated company; or
225 (b) in the case of a group or association, an insurer:

226 (i) owned by the insureds; and
227 (ii) whose exclusive purpose is to insure risks of:
228 (A) a member organization;
229 (B) a group member; or
230 (C) an affiliate of:
231 (I) a member organization; or
232 (II) a group member.
233 [(21)] (22) "Casualty insurance" means liability insurance.
234 [(22)] (23) "Certificate" means evidence of insurance given to:
235 (a) an insured under a group insurance policy; or
236 (b) a third party.
237 [(23)] (24) "Certificate of authority" is included within the term "license."
238 [(24)] (25) "Claim," unless the context otherwise requires, means a request or demand
239 on an insurer for payment of a benefit according to the terms of an insurance policy.
240 [(25)] (26) "Claims-made coverage" means an insurance contract or provision limiting
241 coverage under a policy insuring against legal liability to claims that are first made against the
242 insured while the policy is in force.
243 [(26)] (27) (a) "Commissioner" or "commissioner of insurance" means Utah's
244 insurance commissioner.
245 (b) When appropriate, the terms listed in Subsection [(26)] (27)(a) apply to the
246 equivalent supervisory official of another jurisdiction.
247 [(27)] (28) (a) "Continuing care insurance" means insurance that:
248 (i) provides board and lodging;
249 (ii) provides one or more of the following:
250 (A) a personal service;
251 (B) a nursing service;
252 (C) a medical service; or
253 (D) any other health-related service; and

254 (iii) provides the coverage described in this Subsection [(27)] (28)(a) under an
255 agreement effective:
256 (A) for the life of the insured; or
257 (B) for a period in excess of one year.
258 (b) Insurance is continuing care insurance regardless of whether or not the board and
259 lodging are provided at the same location as a service described in Subsection [(27)] (28)(a)(ii).
260 [(28)] (29) (a) "Control," "controlling," "controlled," or "under common control"
261 means the direct or indirect possession of the power to direct or cause the direction of the
262 management and policies of a person. This control may be:
263 (i) by contract;
264 (ii) by common management;
265 (iii) through the ownership of voting securities; or
266 (iv) by a means other than those described in Subsections [(28)] (29)(a)(i) through (iii).
267 (b) There is no presumption that an individual holding an official position with another
268 person controls that person solely by reason of the position.
269 (c) A person having a contract or arrangement giving control is considered to have
270 control despite the illegality or invalidity of the contract or arrangement.
271 (d) There is a rebuttable presumption of control in a person who directly or indirectly
272 owns, controls, holds with the power to vote, or holds proxies to vote 10% or more of the
273 voting securities of another person.
274 [(29)] (30) "Controlled insurer" means a licensed insurer that is either directly or
275 indirectly controlled by a producer.
276 [(30)] (31) "Controlling person" means a person that directly or indirectly has the
277 power to direct or cause to be directed, the management, control, or activities of a reinsurance
278 intermediary.
279 [(31)] (32) "Controlling producer" means a producer who directly or indirectly controls
280 an insurer.
281 [(32)] (33) (a) "Corporation" means an insurance corporation, except when referring to:

282 (i) a corporation doing business:
283 (A) as:
284 (I) an insurance producer;
285 (II) a limited line producer;
286 (III) a consultant;
287 (IV) a managing general agent;
288 (V) a reinsurance intermediary;
289 (VI) a third party administrator; or
290 (VII) an adjuster; and
291 (B) under:
292 (I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
293 Reinsurance Intermediaries;
294 (II) Chapter 25, Third Party Administrators; or
295 (III) Chapter 26, Insurance Adjusters; or
296 (ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance
297 Holding Companies.
298 (b) "Stock corporation" means a stock insurance corporation.
299 (c) "Mutual" or "mutual corporation" means a mutual insurance corporation.
300 [(33)] (34) (a) "Creditable coverage" has the same meaning as provided in federal
301 regulations adopted pursuant to the Health Insurance Portability and Accountability Act [of
302 1996, Pub. L. 104-191, 110 Stat. 1936].
303 (b) "Creditable coverage" includes coverage that is offered through a public health plan
304 such as:
305 (i) the Primary Care Network Program under a Medicaid primary care network
306 demonstration waiver obtained subject to Section 26-18-3 ;
307 (ii) the Children's Health Insurance Program under Section 26-40-106 ; or
308 (iii) the Ryan White Program Comprehensive AIDS Resources Emergency Act, Pub. L.
309 101-381, and Ryan White HIV/AIDS Treatment Modernization Act of 2006, Pub. L. 109-415.

310 [(34)] (35) "Credit accident and health insurance" means insurance on a debtor to
311 provide indemnity for payments coming due on a specific loan or other credit transaction while
312 the debtor is disabled.
313 [(35)] (36) (a) "Credit insurance" means insurance offered in connection with an
314 extension of credit that is limited to partially or wholly extinguishing that credit obligation.
315 (b) "Credit insurance" includes:
316 (i) credit accident and health insurance;
317 (ii) credit life insurance;
318 (iii) credit property insurance;
319 (iv) credit unemployment insurance;
320 (v) guaranteed automobile protection insurance;
321 (vi) involuntary unemployment insurance;
322 (vii) mortgage accident and health insurance;
323 (viii) mortgage guaranty insurance; and
324 (ix) mortgage life insurance.
325 [(36)] (37) "Credit life insurance" means insurance on the life of a debtor in connection
326 with an extension of credit that pays a person if the debtor dies.
327 [(37)] (38) "Credit property insurance" means insurance:
328 (a) offered in connection with an extension of credit; and
329 (b) that protects the property until the debt is paid.
330 [(38)] (39) "Credit unemployment insurance" means insurance:
331 (a) offered in connection with an extension of credit; and
332 (b) that provides indemnity if the debtor is unemployed for payments coming due on a:
333 (i) specific loan; or
334 (ii) credit transaction.
335 [(39)] (40) "Creditor" means a person, including an insured, having a claim, whether:
336 (a) matured;
337 (b) unmatured;

338 (c) liquidated;
339 (d) unliquidated;
340 (e) secured;
341 (f) unsecured;
342 (g) absolute;
343 (h) fixed; or
344 (i) contingent.
345 [(40)] (41) (a) "Customer service representative" means a person that provides an
346 insurance service and insurance product information:
347 (i) for the customer service representative's:
348 (A) producer; or
349 (B) consultant employer; and
350 (ii) to the customer service representative's employer's:
351 (A) customer;
352 (B) client; or
353 (C) organization.
354 (b) A customer service representative may only operate within the scope of authority of
355 the customer service representative's producer or consultant employer.
356 [(41)] (42) "Deadline" means a final date or time:
357 (a) imposed by:
358 (i) statute;
359 (ii) rule; or
360 (iii) order; and
361 (b) by which a required filing or payment must be received by the department.
362 [(42)] (43) "Deemer clause" means a provision under this title under which upon the
363 occurrence of a condition precedent, the commissioner is considered to have taken a specific
364 action. If the statute so provides, a condition precedent may be the commissioner's failure to
365 take a specific action.

366 [(43)] (44) "Degree of relationship" means the number of steps between two persons
367 determined by counting the generations separating one person from a common ancestor and
368 then counting the generations to the other person.
369 [(44)] (45) "Department" means the Insurance Department.
370 [(45)] (46) "Director" means a member of the board of directors of a corporation.
371 [(46)] (47) "Disability" means a physiological or psychological condition that partially
372 or totally limits an individual's ability to:
373 (a) perform the duties of:
374 (i) that individual's occupation; or
375 (ii) any occupation for which the individual is reasonably suited by education, training,
376 or experience; or
377 (b) perform two or more of the following basic activities of daily living:
378 (i) eating;
379 (ii) toileting;
380 (iii) transferring;
381 (iv) bathing; or
382 (v) dressing.
383 [(47)] (48) "Disability income insurance" is defined in Subsection [(76)] (78).
384 [(48)] (49) "Domestic insurer" means an insurer organized under the laws of this state.
385 [(49)] (50) "Domiciliary state" means the state in which an insurer:
386 (a) is incorporated;
387 (b) is organized; or
388 (c) in the case of an alien insurer, enters into the United States.
389 [(50)] (51) (a) "Eligible employee" means:
390 (i) an employee who:
391 (A) works on a full-time basis; and
392 (B) has a normal work week of 30 or more hours; or
393 (ii) a person described in Subsection [(50)] (51)(b).

394 (b) "Eligible employee" includes, if the individual is included under a health benefit
395 plan of a small employer:
396 (i) a sole proprietor;
397 (ii) a partner in a partnership; or
398 (iii) an independent contractor.
399 (c) "Eligible employee" does not include, unless eligible under Subsection [(50)]
400 (51)(b):
401 (i) an individual who works on a temporary or substitute basis for a small employer;
402 (ii) an employer's spouse; or
403 (iii) a dependent of an employer.
404 [(51)] (52) "Employee" means an individual employed by an employer.
405 [(52)] (53) "Employee benefits" means one or more benefits or services provided to:
406 (a) an employee; or
407 (b) a dependent of an employee.
408 [(53)] (54) (a) "Employee welfare fund" means a fund:
409 (i) established or maintained, whether directly or through a trustee, by:
410 (A) one or more employers;
411 (B) one or more labor organizations; or
412 (C) a combination of employers and labor organizations; and
413 (ii) that provides employee benefits paid or contracted to be paid, other than income
414 from investments of the fund:
415 (A) by or on behalf of an employer doing business in this state; or
416 (B) for the benefit of a person employed in this state.
417 (b) "Employee welfare fund" includes a plan funded or subsidized by a user fee or tax
418 revenues.
419 [(54)] (55) "Endorsement" means a written agreement attached to a policy or certificate
420 to modify the policy or certificate coverage.
421 [(55)] (56) "Enrollment date," with respect to a health benefit plan, means:

422 (a) the first day of coverage; or
423 (b) if there is a waiting period, the first day of the waiting period.
424 [(56)] (57) (a) "Escrow" means:
425 (i) a real estate settlement or real estate closing conducted by a third party pursuant to
426 the requirements of a written agreement between the parties in a real estate transaction; or
427 (ii) a settlement or closing involving:
428 (A) a mobile home;
429 (B) a grazing right;
430 (C) a water right; or
431 (D) other personal property authorized by the commissioner.
432 (b) "Escrow" includes the act of conducting a:
433 (i) real estate settlement; or
434 (ii) real estate closing.
435 [(57)] (58) "Escrow agent" means:
436 (a) an insurance producer with:
437 (i) a title insurance line of authority; and
438 (ii) an escrow subline of authority; or
439 (b) a person defined as an escrow agent in Section 7-22-101 .
440 [(58)] (59) (a) "Excludes" is not exhaustive and does not mean that another thing is not
441 also excluded.
442 (b) The items listed in a list using the term "excludes" are representative examples for
443 use in interpretation of this title.
444 [(59)] (60) "Exclusion" means for the purposes of accident and health insurance that an
445 insurer does not provide insurance coverage, for whatever reason, for one of the following:
446 (a) a specific physical condition;
447 (b) a specific medical procedure;
448 (c) a specific disease or disorder; or
449 (d) a specific prescription drug or class of prescription drugs.

450 [(60)] (61) "Expense reimbursement insurance" means insurance:
451 (a) written to provide a payment for an expense relating to hospital confinement
452 resulting from illness or injury; and
453 (b) written:
454 (i) as a daily limit for a specific number of days in a hospital; and
455 (ii) to have a one or two day waiting period following a hospitalization.
456 [(61)] (62) "Fidelity insurance" means insurance guaranteeing the fidelity of a person
457 holding a position of public or private trust.
458 [(62)] (63) (a) "Filed" means that a filing is:
459 (i) submitted to the department as required by and in accordance with applicable
460 statute, rule, or filing order;
461 (ii) received by the department within the time period provided in applicable statute,
462 rule, or filing order; and
463 (iii) accompanied by the appropriate fee in accordance with:
464 (A) Section 31A-3-103 ; or
465 (B) rule.
466 (b) "Filed" does not include a filing that is rejected by the department because it is not
467 submitted in accordance with Subsection [(62)] (63)(a).
468 [(63)] (64) "Filing," when used as a noun, means an item required to be filed with the
469 department including:
470 (a) a policy;
471 (b) a rate;
472 (c) a form;
473 (d) a document;
474 (e) a plan;
475 (f) a manual;
476 (g) an application;
477 (h) a report;

478 (i) a certificate;
479 (j) an endorsement;
480 (k) an actuarial certification;
481 (l) a licensee annual statement;
482 (m) a licensee renewal application;
483 (n) an advertisement; or
484 (o) an outline of coverage.
485 [(64)] (65) "First party insurance" means an insurance policy or contract in which the
486 insurer agrees to pay a claim submitted to it by the insured for the insured's losses.
487 [(65)] (66) "Foreign insurer" means an insurer domiciled outside of this state, including
488 an alien insurer.
489 [(66)] (67) (a) "Form" means one of the following prepared for general use:
490 (i) a policy;
491 (ii) a certificate;
492 (iii) an application;
493 (iv) an outline of coverage; or
494 (v) an endorsement.
495 (b) "Form" does not include a document specially prepared for use in an individual
496 case.
497 [(67)] (68) "Franchise insurance" means an individual insurance policy provided
498 through a mass marketing arrangement involving a defined class of persons related in some
499 way other than through the purchase of insurance.
500 [(68)] (69) "General lines of authority" include:
501 (a) the general lines of insurance in Subsection [(69)] (70);
502 (b) title insurance under one of the following sublines of authority:
503 (i) search, including authority to act as a title marketing representative;
504 (ii) escrow, including authority to act as a title marketing representative; and
505 (iii) title marketing representative only;

506 (c) surplus lines;
507 (d) workers' compensation; and
508 (e) any other line of insurance that the commissioner considers necessary to recognize
509 in the public interest.
510 [(69)] (70) "General lines of insurance" include:
511 (a) accident and health;
512 (b) casualty;
513 (c) life;
514 (d) personal lines;
515 (e) property; and
516 (f) variable contracts, including variable life and annuity.
517 [(70)] (71) "Group health plan" means an employee welfare benefit plan to the extent
518 that the plan provides medical care:
519 (a) (i) to an employee; or
520 (ii) to a dependent of an employee; and
521 (b) (i) directly;
522 (ii) through insurance reimbursement; or
523 (iii) through another method.
524 [(71)] (72) (a) "Group insurance policy" means a policy covering a group of persons
525 that is issued:
526 (i) to a policyholder on behalf of the group; and
527 (ii) for the benefit of a member of the group who is selected under a procedure defined
528 in:
529 (A) the policy; or
530 (B) an agreement that is collateral to the policy.
531 (b) A group insurance policy may include a member of the policyholder's family or a
532 dependent.
533 [(72)] (73) "Guaranteed automobile protection insurance" means insurance offered in

534 connection with an extension of credit that pays the difference in amount between the
535 insurance settlement and the balance of the loan if the insured automobile is a total loss.
536 [(73)] (74) (a) Except as provided in Subsection [(73)] (74)(b), "health benefit plan"
537 means a policy or certificate that:
538 (i) provides health care insurance;
539 (ii) provides major medical expense insurance; or
540 (iii) is offered as a substitute for hospital or medical expense insurance, such as:
541 (A) a hospital confinement indemnity; or
542 (B) a limited benefit plan.
543 (b) "Health benefit plan" does not include a policy or certificate that:
544 (i) provides benefits solely for:
545 (A) accident;
546 (B) dental;
547 (C) income replacement;
548 (D) long-term care;
549 (E) a Medicare supplement;
550 (F) a specified disease;
551 (G) vision; or
552 (H) a short-term limited duration; or
553 (ii) is offered and marketed as supplemental health insurance.
554 [(74)] (75) "Health care" means any of the following intended for use in the diagnosis,
555 treatment, mitigation, or prevention of a human ailment or impairment:
556 (a) a professional service;
557 (b) a personal service;
558 (c) a facility;
559 (d) equipment;
560 (e) a device;
561 (f) supplies; or

562 (g) medicine.
563 [(75)] (76) (a) "Health care insurance" or "health insurance" means insurance
564 providing:
565 (i) a health care benefit; or
566 (ii) payment of an incurred health care expense.
567 (b) "Health care insurance" or "health insurance" does not include accident and health
568 insurance providing a benefit for:
569 (i) replacement of income;
570 (ii) short-term accident;
571 (iii) fixed indemnity;
572 (iv) credit accident and health;
573 (v) supplements to liability;
574 (vi) workers' compensation;
575 (vii) automobile medical payment;
576 (viii) no-fault automobile;
577 (ix) equivalent self-insurance; or
578 (x) a type of accident and health insurance coverage that is a part of or attached to
579 another type of policy.
580 (77) "Health Insurance Portability and Accountability Act" means the Health Insurance
581 Portability and Accountability Act of 1996, Pub. L. 104-191, 110 Stat. 1936, as amended.
582 [(76)] (78) "Income replacement insurance" or "disability income insurance" means
583 insurance written to provide payments to replace income lost from accident or sickness.
584 [(77)] (79) "Indemnity" means the payment of an amount to offset all or part of an
585 insured loss.
586 [(78)] (80) "Independent adjuster" means an insurance adjuster required to be licensed
587 under Section 31A-26-201 who engages in insurance adjusting as a representative of an insurer.
588 [(79)] (81) "Independently procured insurance" means insurance procured under
589 Section 31A-15-104 .

590 [(80)] (82) "Individual" means a natural person.
591 [(81)] (83) "Inland marine insurance" includes insurance covering:
592 (a) property in transit on or over land;
593 (b) property in transit over water by means other than boat or ship;
594 (c) bailee liability;
595 (d) fixed transportation property such as bridges, electric transmission systems, radio
596 and television transmission towers and tunnels; and
597 (e) personal and commercial property floaters.
598 [(82)] (84) "Insolvency" means that:
599 (a) an insurer is unable to pay its debts or meet its obligations as the debts and
600 obligations mature;
601 (b) an insurer's total adjusted capital is less than the insurer's mandatory control level
602 RBC under Subsection 31A-17-601 (8)(c); or
603 (c) an insurer is determined to be hazardous under this title.
604 [(83)] (85) (a) "Insurance" means:
605 (i) an arrangement, contract, or plan for the transfer of a risk or risks from one or more
606 persons to one or more other persons; or
607 (ii) an arrangement, contract, or plan for the distribution of a risk or risks among a
608 group of persons that includes the person seeking to distribute that person's risk.
609 (b) "Insurance" includes:
610 (i) a risk distributing arrangement providing for compensation or replacement for
611 damages or loss through the provision of a service or a benefit in kind;
612 (ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a
613 business and not as merely incidental to a business transaction; and
614 (iii) a plan in which the risk does not rest upon the person who makes an arrangement,
615 but with a class of persons who have agreed to share the risk.
616 [(84)] (86) "Insurance adjuster" means a person who directs the investigation,
617 negotiation, or settlement of a claim under an insurance policy other than life insurance or an

618 annuity, on behalf of an insurer, policyholder, or a claimant under an insurance policy.
619 [(85)] (87) "Insurance business" or "business of insurance" includes:
620 (a) providing health care insurance by an organization that is or is required to be
621 licensed under this title;
622 (b) providing a benefit to an employee in the event of a contingency not within the
623 control of the employee, in which the employee is entitled to the benefit as a right, which
624 benefit may be provided either:
625 (i) by a single employer or by multiple employer groups; or
626 (ii) through one or more trusts, associations, or other entities;
627 (c) providing an annuity:
628 (i) including an annuity issued in return for a gift; and
629 (ii) except an annuity provided by a person specified in Subsections 31A-22-1305 (2)
630 and (3);
631 (d) providing the characteristic services of a motor club as outlined in Subsection
632 [(113)] (115);
633 (e) providing another person with insurance;
634 (f) making as insurer, guarantor, or surety, or proposing to make as insurer, guarantor,
635 or surety, a contract or policy of title insurance;
636 (g) transacting or proposing to transact any phase of title insurance, including:
637 (i) solicitation;
638 (ii) negotiation preliminary to execution;
639 (iii) execution of a contract of title insurance;
640 (iv) insuring; and
641 (v) transacting matters subsequent to the execution of the contract and arising out of
642 the contract, including reinsurance; [and]
643 [(vi)] (h) transacting or proposing a life settlement; and
644 [(h)] (i) doing, or proposing to do, any business in substance equivalent to Subsections
645 [(85)] (87)(a) through [(g)] (h) in a manner designed to evade this title.

646 [(86)] (88) "Insurance consultant" or "consultant" means a person who:
647 (a) advises another person about insurance needs and coverages;
648 (b) is compensated by the person advised on a basis not directly related to the insurance
649 placed; and
650 (c) except as provided in Section 31A-23a-501 , is not compensated directly or
651 indirectly by an insurer or producer for advice given.
652 [(87)] (89) "Insurance holding company system" means a group of two or more
653 affiliated persons, at least one of whom is an insurer.
654 [(88)] (90) (a) "Insurance producer" or "producer" means a person licensed or required
655 to be licensed under the laws of this state to sell, solicit, or negotiate insurance.
656 [(b) With regards to the selling, soliciting, or negotiating of an insurance product to an
657 insurance customer or an insured:]
658 [(i) "producer] (b) (i) "Producer for the insurer" means a producer who is compensated
659 directly or indirectly by an insurer for selling, soliciting, or negotiating [a] an insurance product
660 of that insurer[; and].
661 (ii) "Producer for the insurer" may be referred to as an "agent."
662 [(ii) "producer] (c) (i) "Producer for the insured" means a producer who:
663 (A) is compensated directly and only by an insurance customer or an insured; and
664 (B) receives no compensation directly or indirectly from an insurer for selling,
665 soliciting, or negotiating [a] an insurance product of that insurer to an insurance customer or
666 insured.
667 (ii) "Producer for the insured" may be referred to as a "broker."
668 [(89)] (91) (a) "Insured" means a person to whom or for whose benefit an insurer
669 makes a promise in an insurance policy and includes:
670 (i) a policyholder;
671 (ii) a subscriber;
672 (iii) a member; and
673 (iv) a beneficiary.

674 (b) The definition in Subsection [(89)] (91)(a):
675 (i) applies only to this title; and
676 (ii) does not define the meaning of this word as used in an insurance policy or
677 certificate.
678 [(90)] (92) (a) "Insurer" means a person doing an insurance business as a principal
679 including:
680 (i) a fraternal benefit society;
681 (ii) an issuer of a gift annuity other than an annuity specified in Subsections
682 31A-22-1305 (2) and (3);
683 (iii) a motor club;
684 (iv) an employee welfare plan; and
685 (v) a person purporting or intending to do an insurance business as a principal on that
686 person's own account.
687 (b) "Insurer" does not include a governmental entity to the extent the governmental
688 entity is engaged in an activity described in Section 31A-12-107 .
689 [(91)] (93) "Interinsurance exchange" is defined in Subsection [(142)] (144).
690 [(92)] (94) "Involuntary unemployment insurance" means insurance:
691 (a) offered in connection with an extension of credit; and
692 (b) that provides indemnity if the debtor is involuntarily unemployed for payments
693 coming due on a:
694 (i) specific loan; or
695 (ii) credit transaction.
696 [(93)] (95) "Large employer," in connection with a health benefit plan, means an
697 employer who, with respect to a calendar year and to a plan year:
698 (a) employed an average of at least 51 eligible employees on each business day during
699 the preceding calendar year; and
700 (b) employs at least two employees on the first day of the plan year.
701 [(94)] (96) "Late enrollee," with respect to an employer health benefit plan, means an

702 individual whose enrollment is a late enrollment.
703 [(95)] (97) "Late enrollment," with respect to an employer health benefit plan, means
704 enrollment of an individual other than:
705 (a) on the earliest date on which coverage can become effective for the individual
706 under the terms of the plan; or
707 (b) through special enrollment.
708 [(96)] (98) (a) Except for a retainer contract or legal assistance described in Section
709 31A-1-103 , "legal expense insurance" means insurance written to indemnify or pay for a
710 specified legal expense.
711 (b) "Legal expense insurance" includes an arrangement that creates a reasonable
712 expectation of an enforceable right.
713 (c) "Legal expense insurance" does not include the provision of, or reimbursement for,
714 legal services incidental to other insurance coverage.
715 [(97)] (99) (a) "Liability insurance" means insurance against liability:
716 (i) for death, injury, or disability of a human being, or for damage to property,
717 exclusive of the coverages under:
718 (A) Subsection [(107)] (109) for medical malpractice insurance;
719 (B) Subsection [(134)] (136) for professional liability insurance; and
720 (C) Subsection [(168)] (170) for workers' compensation insurance;
721 (ii) for a medical, hospital, surgical, and funeral benefit to a person other than the
722 insured who is injured, irrespective of legal liability of the insured, when issued with or
723 supplemental to insurance against legal liability for the death, injury, or disability of a human
724 being, exclusive of the coverages under:
725 (A) Subsection [(107)] (109) for medical malpractice insurance;
726 (B) Subsection [(134)] (136) for professional liability insurance; and
727 (C) Subsection [(168)] (170) for workers' compensation insurance;
728 (iii) for loss or damage to property resulting from an accident to or explosion of a
729 boiler, pipe, pressure container, machinery, or apparatus;

730 (iv) for loss or damage to property caused by:
731 (A) the breakage or leakage of a sprinkler, water pipe, or water container; or
732 (B) water entering through a leak or opening in a building; or
733 (v) for other loss or damage properly the subject of insurance not within another kind
734 of insurance as defined in this chapter, if the insurance is not contrary to law or public policy.
735 (b) "Liability insurance" includes:
736 (i) vehicle liability insurance;
737 (ii) residential dwelling liability insurance; and
738 (iii) making inspection of, and issuing a certificate of inspection upon, an elevator,
739 boiler, machinery, or apparatus of any kind when done in connection with insurance on the
740 elevator, boiler, machinery, or apparatus.
741 [(98)] (100) (a) "License" means authorization issued by the commissioner to engage in
742 an activity that is part of or related to the insurance business.
743 (b) "License" includes a certificate of authority issued to an insurer.
744 [(99)] (101) (a) "Life insurance" means:
745 (i) insurance on a human life; and
746 (ii) insurance pertaining to or connected with human life.
747 (b) The business of life insurance includes:
748 (i) granting a death benefit;
749 (ii) granting an annuity benefit;
750 (iii) granting an endowment benefit;
751 (iv) granting an additional benefit in the event of death by accident;
752 (v) granting an additional benefit to safeguard the policy against lapse; and
753 (vi) providing an optional method of settlement of proceeds.
754 [(100)] (102) "Limited license" means a license that:
755 (a) is issued for a specific product of insurance; and
756 (b) limits an individual or agency to transact only for that product or insurance.
757 [(101)] (103) "Limited line credit insurance" includes the following forms of

758 insurance:
759 (a) credit life;
760 (b) credit accident and health;
761 (c) credit property;
762 (d) credit unemployment;
763 (e) involuntary unemployment;
764 (f) mortgage life;
765 (g) mortgage guaranty;
766 (h) mortgage accident and health;
767 (i) guaranteed automobile protection; and
768 (j) another form of insurance offered in connection with an extension of credit that:
769 (i) is limited to partially or wholly extinguishing the credit obligation; and
770 (ii) the commissioner determines by rule should be designated as a form of limited line
771 credit insurance.
772 [(102)] (104) "Limited line credit insurance producer" means a person who sells,
773 solicits, or negotiates one or more forms of limited line credit insurance coverage to an
774 individual through a master, corporate, group, or individual policy.
775 [(103)] (105) "Limited line insurance" includes:
776 (a) bail bond;
777 (b) limited line credit insurance;
778 (c) legal expense insurance;
779 (d) motor club insurance;
780 (e) [rental car-related] car rental related insurance;
781 (f) travel insurance;
782 (g) crop insurance;
783 (h) self-service storage insurance; [and]
784 (i) guaranteed asset protection waiver; and
785 [(i)] (j) another form of limited insurance that the commissioner determines by rule

786 should be designated a form of limited line insurance.
787 [(104)] (106) "Limited lines authority" includes:
788 (a) the lines of insurance listed in Subsection [(103)] (105); and
789 (b) a customer service representative.
790 [(105)] (107) "Limited lines producer" means a person who sells, solicits, or negotiates
791 limited lines insurance.
792 [(106)] (108) (a) "Long-term care insurance" means an insurance policy or rider
793 advertised, marketed, offered, or designated to provide coverage:
794 (i) in a setting other than an acute care unit of a hospital;
795 (ii) for not less than 12 consecutive months for a covered person on the basis of:
796 (A) expenses incurred;
797 (B) indemnity;
798 (C) prepayment; or
799 (D) another method;
800 (iii) for one or more necessary or medically necessary services that are:
801 (A) diagnostic;
802 (B) preventative;
803 (C) therapeutic;
804 (D) rehabilitative;
805 (E) maintenance; or
806 (F) personal care; and
807 (iv) that may be issued by:
808 (A) an insurer;
809 (B) a fraternal benefit society;
810 (C) (I) a nonprofit health hospital; and
811 (II) a medical service corporation;
812 (D) a prepaid health plan;
813 (E) a health maintenance organization; or

814 (F) an entity similar to the entities described in Subsections [(106)] (108)(a)(iv)(A)
815 through (E) to the extent that the entity is otherwise authorized to issue life or health care
816 insurance.
817 (b) "Long-term care insurance" includes:
818 (i) any of the following that provide directly or supplement long-term care insurance:
819 (A) a group or individual annuity or rider; or
820 (B) a life insurance policy or rider;
821 (ii) a policy or rider that provides for payment of benefits on the basis of:
822 (A) cognitive impairment; or
823 (B) functional capacity; or
824 (iii) a qualified long-term care insurance contract.
825 (c) "Long-term care insurance" does not include:
826 (i) a policy that is offered primarily to provide basic Medicare supplement coverage;
827 (ii) basic hospital expense coverage;
828 (iii) basic medical/surgical expense coverage;
829 (iv) hospital confinement indemnity coverage;
830 (v) major medical expense coverage;
831 (vi) income replacement or related asset-protection coverage;
832 (vii) accident only coverage;
833 (viii) coverage for a specified:
834 (A) disease; or
835 (B) accident;
836 (ix) limited benefit health coverage; or
837 (x) a life insurance policy that accelerates the death benefit to provide the option of a
838 lump sum payment:
839 (A) if the following are not conditioned on the receipt of long-term care:
840 (I) benefits; or
841 (II) eligibility; and

842 (B) the coverage is for one or more the following qualifying events:
843 (I) terminal illness;
844 (II) medical conditions requiring extraordinary medical intervention; or
845 (III) permanent institutional confinement.
846 [(107)] (109) "Medical malpractice insurance" means insurance against legal liability
847 incident to the practice and provision of a medical service other than the practice and provision
848 of a dental service.
849 [(108)] (110) "Member" means a person having membership rights in an insurance
850 corporation.
851 [(109)] (111) "Minimum capital" or "minimum required capital" means the capital that
852 must be constantly maintained by a stock insurance corporation as required by statute.
853 [(110)] (112) "Mortgage accident and health insurance" means insurance offered in
854 connection with an extension of credit that provides indemnity for payments coming due on a
855 mortgage while the debtor is disabled.
856 [(111)] (113) "Mortgage guaranty insurance" means surety insurance under which a
857 mortgagee or other creditor is indemnified against losses caused by the default of a debtor.
858 [(112)] (114) "Mortgage life insurance" means insurance on the life of a debtor in
859 connection with an extension of credit that pays if the debtor dies.
860 [(113)] (115) "Motor club" means a person:
861 (a) licensed under:
862 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
863 (ii) Chapter 11, Motor Clubs; or
864 (iii) Chapter 14, Foreign Insurers; and
865 (b) that promises for an advance consideration to provide for a stated period of time
866 one or more:
867 (i) legal services under Subsection 31A-11-102 (1)(b);
868 (ii) bail services under Subsection 31A-11-102 (1)(c); or
869 (iii) (A) trip reimbursement;

870 (B) towing services;
871 (C) emergency road services;
872 (D) stolen automobile services;
873 (E) a combination of the services listed in Subsections [(113)] (115)(b)(iii)(A) through
874 (D); or
875 (F) other services given in Subsections 31A-11-102 (1)(b) through (f).
876 [(114)] (116) "Mutual" means a mutual insurance corporation.
877 [(115)] (117) "Network plan" means health care insurance:
878 (a) that is issued by an insurer; and
879 (b) under which the financing and delivery of medical care is provided, in whole or in
880 part, through a defined set of providers under contract with the insurer, including the financing
881 and delivery of an item paid for as medical care.
882 [(116)] (118) "Nonparticipating" means a plan of insurance under which the insured is
883 not entitled to receive a dividend representing a share of the surplus of the insurer.
884 [(117)] (119) "Ocean marine insurance" means insurance against loss of or damage to:
885 (a) ships or hulls of ships;
886 (b) goods, freight, cargoes, merchandise, effects, disbursements, profits, money,
887 securities, choses in action, evidences of debt, valuable papers, bottomry, respondentia
888 interests, or other cargoes in or awaiting transit over the oceans or inland waterways;
889 (c) earnings such as freight, passage money, commissions, or profits derived from
890 transporting goods or people upon or across the oceans or inland waterways; or
891 (d) a vessel owner or operator as a result of liability to employees, passengers, bailors,
892 owners of other vessels, owners of fixed objects, customs or other authorities, or other persons
893 in connection with maritime activity.
894 [(118)] (120) "Order" means an order of the commissioner.
895 [(119)] (121) "Outline of coverage" means a summary that explains an accident and
896 health insurance policy.
897 [(120)] (122) "Participating" means a plan of insurance under which the insured is

898 entitled to receive a dividend representing a share of the surplus of the insurer.
899 [(121)] (123) "Participation," as used in a health benefit plan, means a requirement
900 relating to the minimum percentage of eligible employees that must be enrolled in relation to
901 the total number of eligible employees of an employer reduced by each eligible employee who
902 voluntarily declines coverage under the plan because the employee:
903 (a) has other group health care insurance coverage; or
904 (b) receives:
905 (i) Medicare, under the Health Insurance for the Aged Act, Title XVIII of the Social
906 Security Amendments of 1965; or
907 (ii) another government health benefit.
908 [(122)] (124) "Person" includes:
909 (a) an individual;
910 (b) a partnership;
911 (c) a corporation;
912 (d) an incorporated or unincorporated association;
913 (e) a joint stock company;
914 (f) a trust;
915 (g) a limited liability company;
916 (h) a reciprocal;
917 (i) a syndicate; or
918 (j) another similar entity or combination of entities acting in concert.
919 [(123)] (125) "Personal lines insurance" means property and casualty insurance
920 coverage sold for primarily noncommercial purposes to:
921 (a) an individual; or
922 (b) a family.
923 [(124)] (126) "Plan sponsor" is as defined in 29 U.S.C. Sec. 1002(16)(B).
924 [(125)] (127) "Plan year" means:
925 (a) the year that is designated as the plan year in:

926 (i) the plan document of a group health plan; or
927 (ii) a summary plan description of a group health plan;
928 (b) if the plan document or summary plan description does not designate a plan year or
929 there is no plan document or summary plan description:
930 (i) the year used to determine deductibles or limits;
931 (ii) the policy year, if the plan does not impose deductibles or limits on a yearly basis;
932 or
933 (iii) the employer's taxable year if:
934 (A) the plan does not impose deductibles or limits on a yearly basis; and
935 (B) (I) the plan is not insured; or
936 (II) the insurance policy is not renewed on an annual basis; or
937 (c) in a case not described in Subsection [(125)] (127)(a) or (b), the calendar year.
938 [(126)] (128) (a) "Policy" means a document, including an attached endorsement or
939 application that:
940 (i) purports to be an enforceable contract; and
941 (ii) memorializes in writing some or all of the terms of an insurance contract.
942 (b) "Policy" includes a service contract issued by:
943 (i) a motor club under Chapter 11, Motor Clubs;
944 (ii) a service contract provided under Chapter 6a, Service Contracts; and
945 (iii) a corporation licensed under:
946 (A) Chapter 7, Nonprofit Health Service Insurance Corporations; or
947 (B) Chapter 8, Health Maintenance Organizations and Limited Health Plans.
948 (c) "Policy" does not include:
949 (i) a certificate under a group insurance contract; or
950 (ii) a document that does not purport to have legal effect.
951 [(127)] (129) "Policyholder" means a person who controls a policy, binder, or oral
952 contract by ownership, premium payment, or otherwise.
953 [(128)] (130) "Policy illustration" means a presentation or depiction that includes

954 nonguaranteed elements of a policy of life insurance over a period of years.
955 [(129)] (131) "Policy summary" means a synopsis describing the elements of a life
956 insurance policy.
957 [(130)] (132) "Preexisting condition," with respect to a health benefit plan:
958 (a) means a condition that was present before the effective date of coverage, whether or
959 not medical advice, diagnosis, care, or treatment was recommended or received before that day;
960 and
961 (b) does not include a condition indicated by genetic information unless an actual
962 diagnosis of the condition by a physician has been made.
963 [(131)] (133) (a) "Premium" means the monetary consideration for an insurance policy.
964 (b) "Premium" includes, however designated:
965 (i) an assessment;
966 (ii) a membership fee;
967 (iii) a required contribution; or
968 (iv) monetary consideration.
969 (c) (i) "Premium" does not include consideration paid to a third party administrator for
970 the third party administrator's services.
971 (ii) "Premium" includes an amount paid by a third party administrator to an insurer for
972 insurance on the risks administered by the third party administrator.
973 [(132)] (134) "Principal officers" for a corporation means the officers designated under
974 Subsection 31A-5-203 (3).
975 [(133)] (135) "Proceeding" includes an action or special statutory proceeding.
976 [(134)] (136) "Professional liability insurance" means insurance against legal liability
977 incident to the practice of a profession and provision of a professional service.
978 [(135)] (137) (a) Except as provided in Subsection [(135)] (137)(b), "property
979 insurance" means insurance against loss or damage to real or personal property of every kind
980 and any interest in that property:
981 (i) from all hazards or causes; and

982 (ii) against loss consequential upon the loss or damage including vehicle
983 comprehensive and vehicle physical damage coverages.
984 (b) "Property insurance" does not include:
985 (i) inland marine insurance; and
986 (ii) ocean marine insurance.
987 [(136)] (138) "Qualified long-term care insurance contract" or "federally tax qualified
988 long-term care insurance contract" means:
989 (a) an individual or group insurance contract that meets the requirements of Section
990 7702B(b), Internal Revenue Code; or
991 (b) the portion of a life insurance contract that provides long-term care insurance:
992 (i) (A) by rider; or
993 (B) as a part of the contract; and
994 (ii) that satisfies the requirements of Sections 7702B(b) and (e), Internal Revenue
995 Code.
996 [(137)] (139) "Qualified United States financial institution" means an institution that:
997 (a) is:
998 (i) organized under the laws of the United States or any state; or
999 (ii) in the case of a United States office of a foreign banking organization, licensed
1000 under the laws of the United States or any state;
1001 (b) is regulated, supervised, and examined by a United States federal or state authority
1002 having regulatory authority over a bank or trust company; and
1003 (c) meets the standards of financial condition and standing that are considered
1004 necessary and appropriate to regulate the quality of a financial institution whose letters of credit
1005 will be acceptable to the commissioner as determined by:
1006 (i) the commissioner by rule; or
1007 (ii) the Securities Valuation Office of the National Association of Insurance
1008 Commissioners.
1009 [(138)] (140) (a) "Rate" means:

1010 (i) the cost of a given unit of insurance; or
1011 (ii) for property or casualty insurance, that cost of insurance per exposure unit either
1012 expressed as:
1013 (A) a single number; or
1014 (B) a pure premium rate, adjusted before the application of individual risk variations
1015 based on loss or expense considerations to account for the treatment of:
1016 (I) expenses;
1017 (II) profit; and
1018 (III) individual insurer variation in loss experience.
1019 (b) "Rate" does not include a minimum premium.
1020 [(139)] (141) (a) Except as provided in Subsection [(139)] (141)(b), "rate service
1021 organization" means a person who assists an insurer in rate making or filing by:
1022 (i) collecting, compiling, and furnishing loss or expense statistics;
1023 (ii) recommending, making, or filing rates or supplementary rate information; or
1024 (iii) advising about rate questions, except as an attorney giving legal advice.
1025 (b) "Rate service organization" does not mean:
1026 (i) an employee of an insurer;
1027 (ii) a single insurer or group of insurers under common control;
1028 (iii) a joint underwriting group; or
1029 (iv) an individual serving as an actuarial or legal consultant.
1030 [(140)] (142) "Rating manual" means any of the following used to determine initial and
1031 renewal policy premiums:
1032 (a) a manual of rates;
1033 (b) a classification;
1034 (c) a rate-related underwriting rule; and
1035 (d) a rating formula that describes steps, policies, and procedures for determining
1036 initial and renewal policy premiums.
1037 [(141)] (143) "Received by the department" means:

1038 (a) the date delivered to and stamped received by the department, if delivered in
1039 person;
1040 (b) the post mark date, if delivered by mail;
1041 (c) the delivery service's post mark or pickup date, if delivered by a delivery service;
1042 (d) the received date recorded on an item delivered, if delivered by:
1043 (i) facsimile;
1044 (ii) email; or
1045 (iii) another electronic method; or
1046 (e) a date specified in:
1047 (i) a statute;
1048 (ii) a rule; or
1049 (iii) an order.
1050 [(142)] (144) "Reciprocal" or "interinsurance exchange" means an unincorporated
1051 association of persons:
1052 (a) operating through an attorney-in-fact common to all of the persons; and
1053 (b) exchanging insurance contracts with one another that provide insurance coverage
1054 on each other.
1055 [(143)] (145) "Reinsurance" means an insurance transaction where an insurer, for
1056 consideration, transfers any portion of the risk it has assumed to another insurer. In referring to
1057 reinsurance transactions, this title sometimes refers to:
1058 (a) the insurer transferring the risk as the "ceding insurer"; and
1059 (b) the insurer assuming the risk as the:
1060 (i) "assuming insurer"; or
1061 (ii) "assuming reinsurer."
1062 [(144)] (146) "Reinsurer" means a person licensed in this state as an insurer with the
1063 authority to assume reinsurance.
1064 [(145)] (147) "Residential dwelling liability insurance" means insurance against
1065 liability resulting from or incident to the ownership, maintenance, or use of a residential

1066 dwelling that is a detached single family residence or multifamily residence up to four units.
1067 [(146)] (148) (a) "Retrocession" means reinsurance with another insurer of a liability
1068 assumed under a reinsurance contract.
1069 (b) A reinsurer "retrocedes" when the reinsurer reinsures with another insurer part of a
1070 liability assumed under a reinsurance contract.
1071 [(147)] (149) "Rider" means an endorsement to:
1072 (a) an insurance policy; or
1073 (b) an insurance certificate.
1074 [(148)] (150) (a) "Security" means a:
1075 (i) note;
1076 (ii) stock;
1077 (iii) bond;
1078 (iv) debenture;
1079 (v) evidence of indebtedness;
1080 (vi) certificate of interest or participation in a profit-sharing agreement;
1081 (vii) collateral-trust certificate;
1082 (viii) preorganization certificate or subscription;
1083 (ix) transferable share;
1084 (x) investment contract;
1085 (xi) voting trust certificate;
1086 (xii) certificate of deposit for a security;
1087 (xiii) certificate of interest of participation in an oil, gas, or mining title or lease or in
1088 payments out of production under such a title or lease;
1089 (xiv) commodity contract or commodity option;
1090 (xv) certificate of interest or participation in, temporary or interim certificate for,
1091 receipt for, guarantee of, or warrant or right to subscribe to or purchase any of the items listed
1092 in Subsections [(148)] (150)(a)(i) through (xiv); or
1093 (xvi) another interest or instrument commonly known as a security.

1094 (b) "Security" does not include:
1095 (i) any of the following under which an insurance company promises to pay money in a
1096 specific lump sum or periodically for life or some other specified period:
1097 (A) insurance;
1098 (B) an endowment policy; or
1099 (C) an annuity contract; or
1100 (ii) a burial certificate or burial contract.
1101 [(149)] (151) "Secondary medical condition" means a complication related to an
1102 exclusion from coverage in accident and health insurance.
1103 [(150)] (152) (a) "Self-insurance" means an arrangement under which a person
1104 provides for spreading its own risks by a systematic plan.
1105 [(a)] (b) Except as provided in this Subsection [(150)] (152), "self-insurance" does not
1106 include an arrangement under which a number of persons spread their risks among themselves.
1107 [(b)] (c) "Self-insurance" includes:
1108 (i) an arrangement by which a governmental entity undertakes to indemnify an
1109 employee for liability arising out of the employee's employment; and
1110 (ii) an arrangement by which a person with a managed program of self-insurance and
1111 risk management undertakes to indemnify its affiliates, subsidiaries, directors, officers, or
1112 employees for liability or risk that is related to the relationship or employment.
1113 [(c)] (d) "Self-insurance" does not include an arrangement with an independent
1114 contractor.
1115 [(151)] (153) "Sell" means to exchange a contract of insurance:
1116 (a) by any means;
1117 (b) for money or its equivalent; and
1118 (c) on behalf of an insurance company.
1119 [(152)] (154) "Short-term care insurance" means an insurance policy or rider
1120 advertised, marketed, offered, or designed to provide coverage that is similar to long-term care
1121 insurance, but that provides coverage for less than 12 consecutive months for each covered

1122 person.
1123 [(153)] (155) "Significant break in coverage" means a period of 63 consecutive days
1124 during each of which an individual does not have creditable coverage.
1125 [(154)] (156) "Small employer," in connection with a health benefit plan, means an
1126 employer who, with respect to a calendar year and to a plan year:
1127 (a) employed an average of at least two employees but not more than 50 eligible
1128 employees on each business day during the preceding calendar year; and
1129 (b) employs at least two employees on the first day of the plan year.
1130 [(155)] (157) "Special enrollment period," in connection with a health benefit plan, has
1131 the same meaning as provided in federal regulations adopted pursuant to the Health Insurance
1132 Portability and Accountability Act [of 1996, Pub. L. 104-191, 110 Stat. 1936].
1133 [(156)] (158) (a) "Subsidiary" of a person means an affiliate controlled by that person
1134 either directly or indirectly through one or more affiliates or intermediaries.
1135 (b) "Wholly owned subsidiary" of a person is a subsidiary of which all of the voting
1136 shares are owned by that person either alone or with its affiliates, except for the minimum
1137 number of shares the law of the subsidiary's domicile requires to be owned by directors or
1138 others.
1139 [(157)] (159) Subject to Subsection [(83)] (85)(b), "surety insurance" includes:
1140 (a) a guarantee against loss or damage resulting from the failure of a principal to pay or
1141 perform the principal's obligations to a creditor or other obligee;
1142 (b) bail bond insurance; and
1143 (c) fidelity insurance.
1144 [(158)] (160) (a) "Surplus" means the excess of assets over the sum of paid-in capital
1145 and liabilities.
1146 (b) (i) "Permanent surplus" means the surplus of a mutual insurer that is designated by
1147 the insurer as permanent.
1148 (ii) Sections 31A-5-211 , 31A-7-201 , 31A-8-209 , 31A-9-209 , and 31A-14-209 require
1149 that mutuals doing business in this state maintain specified minimum levels of permanent

1150 surplus.
1151 (iii) Except for assessable mutuals, the minimum permanent surplus requirement is the
1152 same as the minimum required capital requirement that applies to stock insurers.
1153 (c) "Excess surplus" means:
1154 (i) for a life insurer, accident and health insurer, health organization, or property and
1155 casualty insurer as defined in Section 31A-17-601 , the lesser of:
1156 (A) that amount of an insurer's or health organization's total adjusted capital that
1157 exceeds the product of:
1158 (I) 2.5; and
1159 (II) the sum of the insurer's or health organization's minimum capital or permanent
1160 surplus required under Section 31A-5-211 , 31A-9-209 , or 31A-14-205 ; or
1161 (B) that amount of an insurer's or health organization's total adjusted capital that
1162 exceeds the product of:
1163 (I) 3.0; and
1164 (II) the authorized control level RBC as defined in Subsection 31A-17-601 (8)(a); and
1165 (ii) for a monoline mortgage guaranty insurer, financial guaranty insurer, or title insurer
1166 that amount of an insurer's paid-in-capital and surplus that exceeds the product of:
1167 (A) 1.5; and
1168 (B) the insurer's total adjusted capital required by Subsection 31A-17-609 (1).
1169 [(159)] (161) "Third party administrator" or "administrator" means a person who
1170 collects charges or premiums from, or who, for consideration, adjusts or settles claims of
1171 residents of the state in connection with insurance coverage, annuities, or service insurance
1172 coverage, except:
1173 (a) a union on behalf of its members;
1174 (b) a person administering a:
1175 (i) pension plan subject to the federal Employee Retirement Income Security Act of
1176 1974;
1177 (ii) governmental plan as defined in Section 414(d), Internal Revenue Code; or

1178 (iii) nonelecting church plan as described in Section 410(d), Internal Revenue Code;
1179 (c) an employer on behalf of the employer's employees or the employees of one or
1180 more of the subsidiary or affiliated corporations of the employer;
1181 (d) an insurer licensed under [Chapter 5, 7, 8, 9, or 14] the following, but only for a
1182 line of insurance for which the insurer holds a license in this state[; or]:
1183 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
1184 (ii) Chapter 7, Nonprofit Health Service Insurance Corporations;
1185 (iii) Chapter 8, Health Maintenance Organizations and Limited Health Plans;
1186 (iv) Chapter 9, Insurance Fraternals; or
1187 (v) Chapter 14, Foreign Insurers; or
1188 (e) a person:
1189 (i) licensed or exempt from licensing under:
1190 (A) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
1191 Reinsurance Intermediaries; or
1192 (B) Chapter 26, Insurance Adjusters; and
1193 (ii) whose activities are limited to those authorized under the license the person holds
1194 or for which the person is exempt.
1195 [(160)] (162) "Title insurance" means the insuring, guaranteeing, or indemnifying of an
1196 owner of real or personal property or the holder of liens or encumbrances on that property, or
1197 others interested in the property against loss or damage suffered by reason of liens or
1198 encumbrances upon, defects in, or the unmarketability of the title to the property, or invalidity
1199 or unenforceability of any liens or encumbrances on the property.
1200 [(161)] (163) "Total adjusted capital" means the sum of an insurer's or health
1201 organization's statutory capital and surplus as determined in accordance with:
1202 (a) the statutory accounting applicable to the annual financial statements required to be
1203 filed under Section 31A-4-113 ; and
1204 (b) another item provided by the RBC instructions, as RBC instructions is defined in
1205 Section 31A-17-601 .

1206 [(162)] (164) (a) "Trustee" means "director" when referring to the board of directors of
1207 a corporation.
1208 (b) "Trustee," when used in reference to an employee welfare fund, means an
1209 individual, firm, association, organization, joint stock company, or corporation, whether acting
1210 individually or jointly and whether designated by that name or any other, that is charged with
1211 or has the overall management of an employee welfare fund.
1212 [(163)] (165) (a) "Unauthorized insurer," "unadmitted insurer," or "nonadmitted
1213 insurer" means an insurer:
1214 (i) not holding a valid certificate of authority to do an insurance business in this state;
1215 or
1216 (ii) transacting business not authorized by a valid certificate.
1217 (b) "Admitted insurer" or "authorized insurer" means an insurer:
1218 (i) holding a valid certificate of authority to do an insurance business in this state; and
1219 (ii) transacting business as authorized by a valid certificate.
1220 [(164)] (166) "Underwrite" means the authority to accept or reject risk on behalf of the
1221 insurer.
1222 [(165)] (167) "Vehicle liability insurance" means insurance against liability resulting
1223 from or incident to ownership, maintenance, or use of a land vehicle or aircraft, exclusive of a
1224 vehicle comprehensive or vehicle physical damage coverage under Subsection [(135)] (137).
1225 [(166)] (168) "Voting security" means a security with voting rights, and includes a
1226 security convertible into a security with a voting right associated with the security.
1227 [(167)] (169) "Waiting period" for a health benefit plan means the period that must
1228 pass before coverage for an individual, who is otherwise eligible to enroll under the terms of
1229 the health benefit plan, can become effective.
1230 [(168)] (170) "Workers' compensation insurance" means:
1231 (a) insurance for indemnification of an employer against liability for compensation
1232 based on:
1233 (i) a compensable accidental injury; and

1234 (ii) occupational disease disability;
1235 (b) employer's liability insurance incidental to workers' compensation insurance and
1236 written in connection with workers' compensation insurance; and
1237 (c) insurance assuring to a person entitled to workers' compensation benefits the
1238 compensation provided by law.
1239 Section 2. Section 31A-2-208 is amended to read:
1240 31A-2-208. Publications.
1241 (1) The commissioner may prepare and distribute books, pamphlets, and other
1242 publications relating to insurance. Except as otherwise provided under this title, the
1243 [insurance] commissioner may charge the cost of producing [the publications] a publication to
1244 those desiring to receive [them] the publication. Money collected from subscription fees
1245 charged for [these publications] a publication shall be deposited [as dedicated credits to be used
1246 solely for the production and mailing costs of the publications] into the Relative Value Study
1247 Restricted Account, created in Section 59-9-105 , to be used as provided in Section 59-9-105 .
1248 (2) The commissioner shall have the annual report required in Subsection
1249 31A-2-207 (5) printed:
1250 (a) in a form determined by [him] the commissioner; and
1251 (b) in sufficient numbers to meet [all] requests for copies.
1252 (3) The commissioner shall publish in [his] the annual report required in Subsection
1253 31A-2-207 (5) an up-to-date chart and explanation of the organization of [his] the
1254 commissioner's office, making clear the allocation of responsibility and authority among the
1255 staff. This [document] up-to-date chart and explanation shall be printed in sufficient numbers
1256 [sufficient] to meet [all] requests for copies.
1257 Section 3. Section 31A-2-212 is amended to read:
1258 31A-2-212. Miscellaneous duties.
1259 (1) Upon issuance of [any] an order limiting, suspending, or revoking [an insurer's] a
1260 person's authority to do business in Utah, and [on institution of any proceedings] when the
1261 commissioner begins a proceeding against [the] an insurer under Chapter 27a, Insurer

1262 Receivership Act, the commissioner:
1263 (a) shall notify by mail [all agents] the producers of the person or insurer of whom the
1264 commissioner has record; and
1265 (b) may publish notice of the order or proceeding in any manner the commissioner
1266 considers necessary to protect the rights of the public.
1267 (2) When required for evidence in [any] a legal proceeding, the commissioner shall
1268 furnish a certificate of [the] authority of [any] a licensee to transact [insurance] the business of
1269 insurance in Utah on any particular date. The court or other officer shall receive the certificate
1270 of authority in lieu of the commissioner's testimony.
1271 (3) (a) On the request of [any] an insurer authorized to do a surety business, the
1272 commissioner shall furnish a copy of the insurer's certificate of authority to [any] a designated
1273 public officer in this state who requires that certificate of authority before accepting a bond.
1274 (b) The public officer described in Subsection (3)(a) shall file the certificate of
1275 authority furnished under Subsection (3)(a).
1276 (c) After a certified copy of a certificate of authority [has been] is furnished to a public
1277 officer, it is not necessary, while the certificate of authority remains effective, to attach a copy
1278 of it to any instrument of suretyship filed with that public officer.
1279 (d) Whenever the commissioner revokes the certificate of authority or [starts
1280 proceedings] begins a proceeding under Chapter 27a, Insurer Receivership Act, against [any]
1281 an insurer authorized to do a surety business, the commissioner shall immediately give notice
1282 of that action to each public officer who [was] is sent a certified copy under this Subsection (3).
1283 (4) (a) The commissioner shall immediately notify every judge and clerk of [all] the
1284 courts of record in the state when:
1285 (i) an authorized insurer doing a surety business:
1286 (A) files a petition for receivership; or
1287 (B) is in receivership; or
1288 (ii) the commissioner has reason to believe that the authorized insurer doing surety
1289 business:

1290 (A) is in financial difficulty; or
1291 (B) has unreasonably failed to carry out any of its contracts.
1292 (b) Upon the receipt of the notice required by this Subsection (4), it is the duty of the
1293 judges and clerks to notify and require [every] a person that [has filed] files with the court a
1294 bond on which the authorized insurer doing surety business is surety[,] to immediately file a
1295 new bond with a new surety.
1296 (5) The commissioner shall require an insurer that issues, sells, renews, or offers health
1297 insurance coverage in this state to comply with the Health Insurance Portability and
1298 Accountability Act[, P.L. 104-191, pursuant to 110 Stat. 1968, Sec. 2722].
1299 Section 4. Section 31A-3-101 is amended to read:
1300 31A-3-101. General finance provisions.
1301 [(1) The department's expenses shall be paid from the General Fund.] Department
1302 expenditures shall conform to the Legislature's appropriation adopted under Title 63J, Chapter
1303 1, Budgetary Procedures Act.
1304 [(2) Except as provided in Section 31A-2-206 , or as otherwise specifically provided in
1305 this title, all money collected by the commissioner shall be deposited without deduction in the
1306 General Fund.]
1307 Section 5. Section 31A-3-103 is amended to read:
1308 31A-3-103. Fees.
1309 (1) For purposes of this section, "services" means functions that are reasonable and
1310 necessary to enable the commissioner to perform the duties imposed by this title including:
1311 (a) issuing or renewing a license or certificate of authority;
1312 (b) filing a policy form;
1313 (c) reporting a producer appointment or termination; and
1314 (d) filing an annual statement.
1315 (2) Except as otherwise provided by this title:
1316 (a) the commissioner may set and collect a fee for services provided by the
1317 commissioner;

1318 (b) a fee related to the renewal of a license may be imposed no more frequently than
1319 once each year; and
1320 (c) a fee charged by the commissioner shall be set in accordance with Section
1321 63J-1-504 .
1322 [(3) Except as otherwise provided in this title, a fee established pursuant to this section
1323 shall be deposited into the General Fund for appropriation by the Legislature.]
1324 [(4)] (3) (a) The commissioner shall publish a schedule of fees established pursuant to
1325 this section.
1326 (b) The commissioner shall, by rule, establish the deadlines for payment of a fee
1327 established pursuant to this section.
1328 (4) (a) Beginning July 1, 2011, there is created in the General Fund a restricted account
1329 known as the "Insurance Department Restricted Account."
1330 (b) Except as provided in Subsection (4)(c), the Insurance Department Restricted
1331 Account shall consist of:
1332 (i) fees authorized by this section; and
1333 (ii) other money received by the department, including:
1334 (A) reimbursements for examination costs incurred by the department; and
1335 (B) forfeitures collected under this title.
1336 (c) The department shall deposit money it receives that is subject to a restricted account
1337 or enterprise fund created by this title into the restricted account or enterprise fund in
1338 accordance with the statute creating the restricted account or enterprise fund, and the
1339 department may not deposit the money into the Insurance Department Restricted Account.
1340 (d) Subject to appropriation by the Legislature, the department may expend money in
1341 the Insurance Department Restricted Account to fund the operations of the department.
1342 (e) At the end of each fiscal year, the director of the Division of Finance shall transfer
1343 into the General Fund any money deposited into the Insurance Department Restricted Account
1344 under Subsection (4)(b) that exceeds the legislative appropriations from the Insurance
1345 Department Restricted Account for that year.

1346 Section 6. Section 31A-3-304 is amended to read:
1347 31A-3-304. Annual fees -- Other taxes or fees prohibited -- Captive Insurance
1348 Restricted Account.
1349 (1) (a) A captive insurance company shall pay an annual fee imposed under this section
1350 to obtain or renew a certificate of authority.
1351 (b) The commissioner shall:
1352 (i) determine the annual fee pursuant to Section 31A-3-103 ; and
1353 (ii) consider whether the annual fee is competitive with fees imposed by other states on
1354 captive insurance companies.
1355 (2) A captive insurance company that fails to pay the fee required by this section is
1356 subject to the relevant sanctions of this title.
1357 (3) (a) Except as provided in Subsection (3)[(b)](d) and notwithstanding Title 59,
1358 Chapter 9, Taxation of Admitted Insurers, [the fee provided for in this section constitutes the
1359 sole tax or fee] the following constitute the sole taxes, fees, or charges under the laws of this
1360 state that may be [otherwise] levied or assessed on a captive insurance company[, and no other
1361 occupation tax or other tax or fee may be levied or collected from a captive insurance company
1362 by the state or a county, city, or municipality within this state.]:
1363 [(b) Notwithstanding Subsection (3)(a), a]
1364 (i) a fee under this section;
1365 (ii) a fee under Chapter 37, Captive Insurance Companies Act; and
1366 (iii) a fee under Chapter 37a, Special Purpose Financial Captive Insurance Company
1367 Act.
1368 (b) The state or a county, city, or town within the state may not levy or collect an
1369 occupation tax or other tax, fee, or charge not described in Subsections (3)(a)(i) through (iii)
1370 against a captive insurance company.
1371 (c) The state may not levy, assess, or collect a withdrawal fee under Section 31A-4-115
1372 against a captive insurance company.
1373 (d) A captive insurance company is subject to real and personal property taxes.

1374 (4) A captive insurance company shall pay the fee imposed by this section to the
1375 commissioner by [March 31] June 20 of each year.
1376 (5) (a) Money received pursuant to [Subsection (2)] a fee described in Subsection
1377 (3)(a) shall be deposited into the Captive Insurance Restricted Account.
1378 (b) There is created in the General Fund a restricted account known as the "Captive
1379 Insurance Restricted Account."
1380 (c) The Captive Insurance Restricted Account shall consist of the fees [imposed by the
1381 commissioner in accordance with this section] described in Subsection (3)(a).
1382 (d) The commissioner shall administer the Captive Insurance Restricted Account.
1383 Subject to appropriations by the Legislature, the commissioner shall use the money deposited
1384 into the Captive Insurance Restricted Account to:
1385 (i) administer and enforce:
1386 (A) Chapter 37, Captive Insurance Companies Act; and
1387 (B) Chapter 37a, Special Purpose Financial Captive Insurance Company Act; and
1388 (ii) promote the captive insurance industry in Utah.
1389 (e) An appropriation from the Captive Insurance Restricted Account is nonlapsing,
1390 except that at the end of each fiscal year, money received by the commissioner in excess of
1391 [$600,000] $950,000 shall be treated as free revenue in the General Fund.
1392 Section 7. Section 31A-14-211 is amended to read:
1393 31A-14-211. Restrictions on foreign title insurers.
1394 (1) An authorized foreign title insurer may not insure property in this state except:
1395 (a) through a title insurance producer who is a resident in Utah; or
1396 (b) through a bona fide [branch] office in Utah:
1397 (i) that is under the direction and control of the authorized foreign title insurer [that
1398 pays all];
1399 (ii) for which the authorized foreign title insurer pays the expenses [of the branch
1400 office], including compensation of [all] the employees[; or] of the bona fide office;
1401 (iii) at which a person may request information about title services related to a real

1402 estate transaction for which the person is a party;
1403 (iv) at which a person may deliver written communications to the authorized foreign
1404 title insurer as required by the real estate transaction for which the person is a party; and
1405 (v) at which a person may deliver escrow money related to a real estate transaction for
1406 which the person is a party.
1407 [(c) through a subsidiary title insurer authorized to do business in Utah.]
1408 (2) This section does not apply to reinsurance.
1409 Section 8. Section 31A-22-607 is amended to read:
1410 31A-22-607. Grace period.
1411 (1) [Every] (a) An individual or franchise accident and health insurance policy shall
1412 contain one or more clauses providing for a grace period for premium payment only of:
1413 (i) at least 15 days for a weekly or monthly premium [policies] policy; and
1414 (ii) 30 days for [all other policies] a policy that is not a weekly or monthly premium
1415 policy, for each premium after the first premium payment. [A carrier]
1416 (b) An insurer may elect to include a grace period that is longer than 15 days for a
1417 weekly or monthly [policies] policy.
1418 [(a) The] (c) An individual or franchise accident and health insurance policy is not in
1419 force during [the] a grace period.
1420 [(b) If the] (d) If an insurer receives payment before [the] a grace period expires, the
1421 individual or franchise accident and health insurance policy continues in force with no gap in
1422 coverage.
1423 [(c) If the] (e) If an insurer does not receive payment before [the] a grace period
1424 expires, the [policy shall be] individual or franchise accident and health insurance policy is
1425 terminated as of the last date for which the premium [was] is paid in full.
1426 [(d)] (f) A grace period is not required if the policyholder has requested that the
1427 individual or franchise accident and health insurance policy be discontinued.
1428 (2) [Every] (a) A group or blanket accident and health insurance policy shall provide
1429 for a grace period of at least 30 days, unless the policyholder gives written notice of

1430 discontinuance [prior to] before the date of discontinuance, in accordance with the policy
1431 terms. [In group or blanket policies, the]
1432 (b) A group or blanket accident and health insurance policy is in force during a grace
1433 period.
1434 (c) If an insurer does not receive payment before a grace period expires, the group or
1435 blanket accident and health insurance policy is terminated as of the last day of the grace period.
1436 (d) A group or blanket accident and health insurance policy may provide for payment
1437 of a pro rata premium for the period the group or blanket accident and health insurance policy
1438 is in effect during [the] a grace period under this Subsection (2).
1439 (3) If [the] an insurer has not guaranteed the insured a right to renew an accident and
1440 health insurance policy, [any] a grace period beyond the expiration or anniversary date may, if
1441 provided in the accident and health insurance policy, be cut off by compliance with the notice
1442 provision under Subsection 31A-21-303 (4)(b).
1443 Section 9. Section 31A-22-610.6 is amended to read:
1444 31A-22-610.6. Special enrollment for individuals receiving premium assistance.
1445 (1) As used in this section:
1446 (a) "Premium assistance" means assistance under Title 26, Chapter 18, Medical
1447 Assistance Act, in the payment of premium.
1448 (b) "Qualified beneficiary" means an individual who is approved to receive premium
1449 assistance.
1450 (2) Subject to the other provisions in this section, an individual may enroll under this
1451 section at a time outside of an employer health benefit plan open enrollment period, regardless
1452 of previously waiving coverage, if the individual is:
1453 (a) a qualified beneficiary who is eligible for coverage as an employee under the
1454 employer health benefit plan; or
1455 (b) a dependent of the qualified beneficiary who is eligible for coverage under the
1456 employer health benefit plan.
1457 (3) To be eligible to enroll outside of an open enrollment period, an individual

1458 described in Subsection (2) shall enroll in the employer health benefit plan by no later than 30
1459 days from the day on which the qualified beneficiary receives initial written notification, after
1460 July 1, 2008, that the qualified beneficiary is eligible to receive premium assistance.
1461 (4) An individual described in Subsection (2) may enroll under this section only in an
1462 employer health benefit plan that is available at the time of enrollment to similarly situated
1463 eligible employees or dependents of eligible employees.
1464 (5) Coverage under an employer health benefit plan for an individual described in
1465 Subsection (2) may begin as soon as the first day of the month immediately following
1466 enrollment of the individual in accordance with this section.
1467 (6) This section does not modify any requirement related to premiums that applies
1468 under an employer health benefit plan to a similarly situated eligible employee or dependent of
1469 an eligible employee under the employer health benefit plan.
1470 (7) An employer health benefit plan may require an individual described in Subsection
1471 (2) to satisfy a preexisting condition waiting period that:
1472 (a) is allowed under the Health Insurance Portability and Accountability Act [of 1996,
1473 Pub. L. 104-191, 110 Stat. 1936]; and
1474 (b) is not longer than 12 months.
1475 Section 10. Section 31A-22-614.5 is amended to read:
1476 31A-22-614.5. Uniform claims processing -- Electronic exchange of health
1477 information.
1478 (1) (a) Except as provided in Subsection (1)(c), all insurers offering health insurance
1479 shall use a uniform claim form and uniform billing and claim codes.
1480 (b) Beginning January 1, 2011, all health benefit plans, and dental and vision plans,
1481 shall provide for the electronic exchange of uniform:
1482 (i) eligibility and coverage information; and
1483 (ii) coordination of benefits information.
1484 (c) For purposes of Subsection (1)(a), "health insurance" does not include a policy or
1485 certificate that provides benefits solely for:

1486 (i) income replacement; or
1487 (ii) long-term care.
1488 (2) (a) The uniform electronic standards and information required in Subsection (1)
1489 shall be adopted and approved by the commissioner in accordance with Title 63G, Chapter 3,
1490 Utah Administrative Rulemaking Act.
1491 (b) When adopting rules under this section the commissioner:
1492 (i) shall:
1493 (A) consult with national and state organizations involved with the standardized
1494 exchange of health data, and the electronic exchange of health data, to develop the standards
1495 for the use and electronic exchange of uniform:
1496 (I) claim forms;
1497 (II) billing and claim codes;
1498 (III) insurance eligibility and coverage information; and
1499 (IV) coordination of benefits information; and
1500 (B) meet federal mandatory minimum standards following the adoption of national
1501 requirements for transaction and data elements in the federal Health Insurance Portability and
1502 Accountability Act [of 1996, Pub. L. 104-191, 110 Stat. 1936];
1503 (ii) may not require an insurer or administrator to use a specific software product or
1504 vendor; and
1505 (iii) may require an insurer who participates in the all payer database created under
1506 Section 26-33a-106.1 to allow data regarding demographic and insurance coverage information
1507 to be electronically shared with the state's designated secure health information master person
1508 index to be used:
1509 (A) in compliance with data security standards established by:
1510 (I) the federal Health Insurance Portability and Accountability Act [of 1996, Pub. L.
1511 104-191, 110 Stat. 1936]; and
1512 (II) the electronic commerce agreements established in a business associate agreement;
1513 and

1514 (B) for the purpose of coordination of health benefit plans.
1515 (3) (a) The commissioner shall coordinate the administrative rules adopted under the
1516 provisions of this section with the administrative rules adopted by the Department of Health for
1517 the implementation of the standards for the electronic exchange of clinical health information
1518 under Section 26-1-37 . The department shall establish procedures for developing the rules
1519 adopted under this section, which ensure that the Department of Health is given the opportunity
1520 to comment on proposed rules.
1521 (b) (i) The commissioner may provide information to health care providers regarding
1522 resources available to a health care provider to verify whether a health care provider's practice
1523 management software system meets the uniform electronic standards for data exchange
1524 required by this section.
1525 (ii) The commissioner may provide the information described in Subsection (3)(b)(i)
1526 by partnering with:
1527 (A) a not-for-profit, broad based coalition of state health care insurers and health care
1528 providers who are involved in the electronic exchange of the data required by this section; or
1529 (B) some other person that the commissioner determines is appropriate to provide the
1530 information described in Subsection (3)(b)(i).
1531 (c) The commissioner shall regulate any fees charged by insurers to the providers for:
1532 (i) uniform claim forms;
1533 (ii) electronic billing; or
1534 (iii) the electronic exchange of clinical health information permitted by Section
1535 26-1-37 .
1536 Section 11. Section 31A-22-618.5 is amended to read:
1537 31A-22-618.5. Health benefit plan offerings.
1538 (1) The purpose of this section is to increase the range of health benefit plans available
1539 in the small group, small employer group, large group, and individual insurance markets.
1540 (2) A health maintenance organization that is subject to Chapter 8, Health Maintenance
1541 Organizations and Limited Health Plans:

1542 (a) shall offer to potential purchasers at least one health benefit plan that is subject to
1543 the requirements of Chapter 8, Health Maintenance Organizations and Limited Health Plans;
1544 and
1545 (b) may offer to a potential purchaser one or more health benefit plans that:
1546 (i) are not subject to one or more of the following:
1547 (A) the limitations on insured indemnity benefits in Subsection 31A-8-105 (4);
1548 (B) the limitation on point of service products in Subsections 31A-8-408 (3) through
1549 (6);
1550 (C) except as provided in Subsection (2)(b)(ii), basic health care services as defined in
1551 Section 31A-8-101 ; or
1552 (D) coverage mandates enacted after January 1, 2009 that are not required by federal
1553 law, provided that the insurer offers one plan under Subsection (2)(a) that covers the mandate
1554 enacted after January 1, 2009; and
1555 (ii) when offering a health plan under this section, provide coverage for an emergency
1556 medical condition as required by Section 31A-22-627 as follows:
1557 (A) within the organization's service area, covered services shall include health care
1558 services from non-affiliated providers when medically necessary to stabilize an emergency
1559 medical condition; and
1560 (B) outside the organization's service area, covered services shall include medically
1561 necessary health care services for the treatment of an emergency medical condition that are
1562 immediately required while the enrollee is outside the geographic limits of the organization's
1563 service area.
1564 (3) An insurer that offers a health benefit plan that is not subject to Chapter 8, Health
1565 Maintenance Organizations and Limited Health Plans:
1566 (a) notwithstanding Subsection 31A-22-617 (2), may offer a health benefit plan that
1567 groups providers into the following reimbursement levels:
1568 (i) tier one contracted providers;
1569 (ii) tier two contracted providers who the insurer must reimburse at least 75% of tier

1570 one providers; and
1571 (iii) one or more tiers of non-contracted providers; [and]
1572 (b) notwithstanding Subsection 31A-22-617 (9) may offer a health benefit plan that is
1573 not subject to Section 31A-22-618 ;
1574 (c) beginning July 1, 2012, may offer [products under Subsection (3)(a)] health benefit
1575 plans that:
1576 (i) are not subject to Subsection 31A-22-617 (2); and
1577 (ii) are subject to the reimbursement requirements in Section 31A-8-501 ;
1578 (d) when offering a health plan under this Subsection (3), shall provide coverage of
1579 emergency care services as required by Section 31A-22-627 by providing coverage at a
1580 reimbursement level of at least 75% of [tier one providers] the health benefit plan's highest
1581 contracted provider category; and
1582 (e) are not subject to coverage mandates enacted after January 1, 2009 that are not
1583 required by federal law, provided that an insurer offers one plan that covers a mandate enacted
1584 after January 1, 2009.
1585 (4) Section 31A-8-106 does not prohibit the offer of a health benefit plan under
1586 Subsection (2)(b).
1587 (5) (a) Any difference in price between a health benefit plan offered under Subsections
1588 (2)(a) and (b) shall be based on actuarially sound data.
1589 (b) Any difference in price between a health benefit plan offered under Subsections
1590 (3)(a) and (b) shall be based on actuarially sound data.
1591 (6) Nothing in this section limits the number of health benefit plans that an insurer may
1592 offer.
1593 Section 12. Section 31A-22-625 is amended to read:
1594 31A-22-625. Catastrophic coverage of mental health conditions.
1595 (1) As used in this section:
1596 (a) (i) "Catastrophic mental health coverage" means coverage in a health benefit plan
1597 that does not impose a lifetime limit, annual payment limit, episodic limit, inpatient or

1598 outpatient service limit, or maximum out-of-pocket limit that places a greater financial burden
1599 on an insured for the evaluation and treatment of a mental health condition than for the
1600 evaluation and treatment of a physical health condition.
1601 (ii) "Catastrophic mental health coverage" may include a restriction on cost sharing
1602 factors, such as deductibles, copayments, or coinsurance, before reaching a maximum
1603 out-of-pocket limit.
1604 (iii) "Catastrophic mental health coverage" may include one maximum out-of-pocket
1605 limit for physical health conditions and another maximum out-of-pocket limit for mental health
1606 conditions, except that if separate out-of-pocket limits are established, the out-of-pocket limit
1607 for mental health conditions may not exceed the out-of-pocket limit for physical health
1608 conditions.
1609 (b) (i) "50/50 mental health coverage" means coverage in a health benefit plan that
1610 pays for at least 50% of covered services for the diagnosis and treatment of mental health
1611 conditions.
1612 (ii) "50/50 mental health coverage" may include a restriction on:
1613 (A) episodic limits;
1614 (B) inpatient or outpatient service limits; or
1615 (C) maximum out-of-pocket limits.
1616 (c) "Large employer" is as defined in 42 U.S.C. Sec. 300gg-91.
1617 (d) (i) "Mental health condition" means a condition or disorder involving mental illness
1618 that falls under a diagnostic category listed in the Diagnostic and Statistical Manual, as
1619 periodically revised.
1620 (ii) "Mental health condition" does not include the following when diagnosed as the
1621 primary or substantial reason or need for treatment:
1622 (A) a marital or family problem;
1623 (B) a social, occupational, religious, or other social maladjustment;
1624 (C) a conduct disorder;
1625 (D) a chronic adjustment disorder;

1626 (E) a psychosexual disorder;
1627 (F) a chronic organic brain syndrome;
1628 (G) a personality disorder;
1629 (H) a specific developmental disorder or learning disability; or
1630 (I) mental retardation.
1631 (e) "Small employer" is as defined in 42 U.S.C. Sec. 300gg-91.
1632 (2) (a) At the time of purchase and renewal, an insurer shall offer to a small employer
1633 that it insures or seeks to insure a choice between catastrophic mental health coverage and
1634 50/50 mental health coverage.
1635 (b) In addition to complying with Subsection (2)(a), an insurer may offer to provide:
1636 (i) catastrophic mental health coverage, 50/50 mental health coverage, or both at levels
1637 that exceed the minimum requirements of this section; or
1638 (ii) coverage that excludes benefits for mental health conditions.
1639 (c) A small employer may, at its option, choose either catastrophic mental health
1640 coverage, 50/50 mental health coverage, or coverage offered under Subsection (2)(b),
1641 regardless of the employer's previous coverage for mental health conditions.
1642 (d) An insurer is exempt from the 30% index rating restriction in Section
1643 31A-30-106.1 and, for the first year only that catastrophic mental health coverage is chosen, the
1644 15% annual adjustment restriction in Section 31A-30-106.1 , for any small employer with 20 or
1645 less enrolled employees who chooses coverage that meets or exceeds catastrophic mental
1646 health coverage.
1647 (3) An insurer shall offer a large employer mental health and substance use disorder
1648 benefit in compliance with Section 2705 of the Public Health Service Act, 42 U.S.C. Sec.
1649 [300gg-5] 300gg-26, and federal regulations adopted pursuant to that act.
1650 (4) (a) An insurer may provide catastrophic mental health coverage to a small employer
1651 through a managed care organization or system in a manner consistent with Chapter 8, Health
1652 Maintenance Organizations and Limited Health Plans, regardless of whether the insurance
1653 policy uses a managed care organization or system for the treatment of physical health

1654 conditions.
1655 (b) (i) Notwithstanding any other provision of this title, an insurer may:
1656 (A) establish a closed panel of providers for catastrophic mental health coverage; and
1657 (B) refuse to provide a benefit to be paid for services rendered by a nonpanel provider
1658 unless:
1659 (I) the insured is referred to a nonpanel provider with the prior authorization of the
1660 insurer; and
1661 (II) the nonpanel provider agrees to follow the insurer's protocols and treatment
1662 guidelines.
1663 (ii) If an insured receives services from a nonpanel provider in the manner permitted by
1664 Subsection (4)(b)(i)(B), the insurer shall reimburse the insured for not less than 75% of the
1665 average amount paid by the insurer for comparable services of panel providers under a
1666 noncapitated arrangement who are members of the same class of health care providers.
1667 (iii) This Subsection (4)(b) may not be construed as requiring an insurer to authorize a
1668 referral to a nonpanel provider.
1669 (c) To be eligible for catastrophic mental health coverage, a diagnosis or treatment of a
1670 mental health condition must be rendered:
1671 (i) by a mental health therapist as defined in Section 58-60-102 ; or
1672 (ii) in a health care facility:
1673 (A) licensed or otherwise authorized to provide mental health services pursuant to:
1674 (I) Title 26, Chapter 21, Health Care Facility Licensing and Inspection Act; or
1675 (II) Title 62A, Chapter 2, Licensure of Programs and Facilities; and
1676 (B) that provides a program for the treatment of a mental health condition pursuant to a
1677 written plan.
1678 (5) The commissioner may prohibit an insurance policy that provides mental health
1679 coverage in a manner that is inconsistent with this section.
1680 (6) The commissioner shall:
1681 (a) adopt rules, in accordance with Title 63G, Chapter 3, Utah Administrative

1682 Rulemaking Act, as necessary to ensure compliance with this section; and
1683 (b) provide general figures on the percentage of insurance policies that include:
1684 (i) no mental health coverage;
1685 (ii) 50/50 mental health coverage;
1686 (iii) catastrophic mental health coverage; and
1687 (iv) coverage that exceeds the minimum requirements of this section.
1688 (7) This section may not be construed as discouraging or otherwise preventing an
1689 insurer from providing mental health coverage in connection with an individual insurance
1690 policy.
1691 (8) This section shall be repealed in accordance with Section 63I-1-231 .
1692 Section 13. Section 31A-22-701 is amended to read:
1693 31A-22-701. Groups eligible for group or blanket insurance.
1694 (1) As used in this section, "association group" means a lawfully formed association of
1695 individuals or business entities that:
1696 (a) purchases insurance on a group basis on behalf of members; and
1697 (b) is formed and maintained in good faith for purposes other than obtaining insurance.
1698 (2) A group [or blanket] accident and health insurance policy may be issued to:
1699 (a) a group:
1700 (i) to which a group life insurance policy may be issued under Sections 31A-22-502 ,
1701 31A-22-503 , 31A-22-504 , 31A-22-506 , 31A-22-507 , and 31A-22-509 ; and
1702 (ii) that is formed [for a reason other than the purchase of insurance] and maintained in
1703 good faith for a purpose other than obtaining insurance;
1704 (b) an association group that:
1705 (i) has been actively in existence for at least five years;
1706 (ii) has a constitution and bylaws;
1707 (iii) is formed and maintained in good faith for purposes other than obtaining
1708 insurance;
1709 (iv) does not condition membership in the association group on any health

1710 status-related factor relating to an individual, including an employee of an employer or a
1711 dependent of an employee;
1712 (v) makes accident and health insurance coverage offered through the association
1713 group available to all members regardless of any health status-related factor relating to the
1714 members or individuals eligible for coverage through a member; [and]
1715 (vi) does not make accident and health insurance coverage offered through the
1716 association group available other than in connection with a member of the association group;
1717 [or] and
1718 (vii) is actuarially sound; or
1719 (c) a group specifically authorized by the commissioner under Section 31A-22-509 ,
1720 upon a finding that:
1721 (i) authorization is not contrary to the public interest;
1722 (ii) the [proposed] group is actuarially sound;
1723 (iii) formation of the proposed group may result in economies of scale in acquisition,
1724 administrative, marketing, and brokerage costs;
1725 (iv) the insurance policy, insurance certificate, or other indicia of coverage that will be
1726 offered to the proposed group is substantially equivalent to insurance policies that are
1727 otherwise available to similar groups;
1728 (v) the group would not present hazards of adverse selection; [and]
1729 (vi) the premiums for the insurance policy and any contributions by or on behalf of the
1730 insured persons are reasonable in relation to the benefits provided[.]; and
1731 (vii) the group is formed and maintained in good faith for a purpose other than
1732 obtaining insurance.
1733 (3) A blanket accident and health insurance policy:
1734 (a) covers a defined class of persons;
1735 (b) may not be offered or underwritten on an individual basis;
1736 (c) shall cover only a group that is:
1737 (i) actuarially sound; and

1738 (ii) formed and maintained in good faith for a purpose other than obtaining insurance;
1739 and
1740 (d) may [also] be issued only to:
1741 [(a)] (i) a common carrier or an operator, owner, or lessee of a means of transportation,
1742 as policyholder, covering persons who may become passengers as defined by reference to
1743 [their] the person's travel status;
1744 [(b)] (ii) an employer, as policyholder, covering any group of employees, dependents,
1745 or guests, as defined by reference to specified hazards incident to any activities of the
1746 policyholder;
1747 [(c)] (iii) an institution of learning, including a school district, a school jurisdictional
1748 [units] unit, or the head, principal, or governing board of [any of those units] a school
1749 jurisdictional unit, as policyholder, covering students, teachers, or employees;
1750 [(d)] (iv) a religious, charitable, recreational, educational, or civic organization, or
1751 branch of one of those organizations, as policyholder, covering [any] a group of members or
1752 participants as defined by reference to specified hazards incident to the activities sponsored or
1753 supervised by the policyholder;
1754 [(e)] (v) a sports team, camp, or sponsor of [the] a sports team or camp, as
1755 policyholder, covering members, campers, employees, officials, or supervisors;
1756 [(f)] (vi) a volunteer fire department, first aid, civil defense, or other similar volunteer
1757 organization, as policyholder, covering [any] a group of members or participants as defined by
1758 reference to specified hazards incident to activities sponsored, supervised, or participated in by
1759 the policyholder;
1760 [(g)] (vii) a newspaper or other publisher, as policyholder, covering its carriers;
1761 [(h)] (viii) an association, including a labor union, [which] that has a constitution and
1762 bylaws and [which has been] that is organized in good faith for purposes other than that of
1763 obtaining insurance, as policyholder, covering [any] a group of members or participants as
1764 defined by reference to specified hazards incident to the activities or operations sponsored or
1765 supervised by the policyholder; and

1766 [(i) a health insurance purchasing association, as defined in Section 31A-34-103 ,
1767 organized and controlled solely by participating employers; and]
1768 [(j)] (ix) any other class of risks that, in the judgment of the commissioner, may be
1769 properly eligible for blanket accident and health insurance.
1770 (4) The judgment of the commissioner may be exercised on the basis of:
1771 (a) individual risks;
1772 (b) a class of risks; or
1773 (c) both Subsections (4)(a) and (b).
1774 Section 14. Section 31A-22-716 is amended to read:
1775 31A-22-716. Required provision for notice of termination.
1776 (1) Every policy for group or blanket accident and health coverage issued or renewed
1777 after July 1, 1990, shall include a provision that obligates the policyholder to give 30 days prior
1778 written notice of termination to each employee or group member and to notify each employee
1779 or group member of his rights to continue coverage upon termination.
1780 (2) An insurer's monthly notice to the policyholder of premium payments due shall
1781 include a statement of the policyholder's obligations as set forth in Subsection (1). Insurers
1782 shall provide a sample notice to the policyholder at least once a year.
1783 (3) For the purpose of compliance with federal law and the Health Insurance Portability
1784 and Accountability Act[, P.L. No. 104-191, 110 Stat. 1960], all health benefit plans, health
1785 insurers, and student health plans must provide a certificate of creditable coverage to each
1786 covered person upon the person's termination from the plan as soon as reasonably possible.
1787 Section 15. Section 31A-22-721 is amended to read:
1788 31A-22-721. A health benefit plan for a plan sponsor -- Discontinuance and
1789 nonrenewal.
1790 (1) Except as otherwise provided in this section, a health benefit plan for a plan
1791 sponsor is renewable and continues in force:
1792 (a) with respect to all eligible employees and dependents; and
1793 (b) at the option of the plan sponsor.

1794 (2) A health benefit plan for a plan sponsor may be discontinued or nonrenewed:
1795 (a) for a network plan, if:
1796 (i) there is no longer any enrollee under the group health plan who lives, resides, or
1797 works in:
1798 (A) the service area of the insurer; or
1799 (B) the area for which the insurer is authorized to do business; and
1800 (ii) in the case of the small employer market, the insurer applies the same criteria the
1801 insurer would apply in denying enrollment in the plan under Subsection 31A-30-108 (7); or
1802 (b) for coverage made available in the small or large employer market only through an
1803 association, if:
1804 (i) the employer's membership in the association ceases; and
1805 (ii) the coverage is terminated uniformly without regard to any health status-related
1806 factor relating to any covered individual.
1807 (3) A health benefit plan for a plan sponsor may be discontinued if:
1808 (a) a condition described in Subsection (2) exists;
1809 (b) the plan sponsor fails to pay premiums or contributions in accordance with the
1810 terms of the contract;
1811 (c) the plan sponsor:
1812 (i) performs an act or practice that constitutes fraud; or
1813 (ii) makes an intentional misrepresentation of material fact under the terms of the
1814 coverage;
1815 (d) the insurer:
1816 (i) elects to discontinue offering a particular health benefit product delivered or issued
1817 for delivery in this state;
1818 (ii) (A) provides notice of the discontinuation in writing:
1819 (I) to each plan sponsor, employee, and dependent of a plan sponsor or employee; and
1820 (II) at least 90 days before the date the coverage will be discontinued;
1821 (B) provides notice of the discontinuation in writing:

1822 (I) to the commissioner; and
1823 (II) at least three working days prior to the date the notice is sent to the affected plan
1824 sponsors, employees, and dependents of plan sponsors or employees;
1825 (C) offers to each plan sponsor, on a guaranteed issue basis, the option to purchase any
1826 other health benefit products currently being offered:
1827 (I) by the insurer in the market; or
1828 (II) in the case of a large employer, any other health benefit plan currently being
1829 offered in that market; and
1830 (D) in exercising the option to discontinue that product and in offering the option of
1831 coverage in this section, the insurer acts uniformly without regard to:
1832 (I) the claims experience of a plan sponsor;
1833 (II) any health status-related factor relating to any covered participant or beneficiary; or
1834 (III) any health status-related factor relating to a new participant or beneficiary who
1835 may become eligible for coverage; or
1836 (e) the insurer:
1837 (i) elects to discontinue all of the insurer's health benefit plans:
1838 (A) in the small employer market; or
1839 (B) the large employer market; or
1840 (C) both the small and large employer markets; and
1841 (ii) (A) provides notice of the discontinuance in writing:
1842 (I) to each plan sponsor, employee, or dependent of a plan sponsor or an employee; and
1843 (II) at least 180 days before the date the coverage will be discontinued;
1844 (B) provides notice of the discontinuation in writing:
1845 (I) to the commissioner in each state in which an affected insured individual is known
1846 to reside; and
1847 (II) at least 30 business days prior to the date the notice is sent to the affected plan
1848 sponsors, employees, and dependents of a plan sponsor or employee;
1849 (C) discontinues and nonrenews all plans issued or delivered for issuance in the

1850 market; and
1851 (D) provides a plan of orderly withdrawal as required by Section 31A-4-115 .
1852 (4) A large employer health benefit plan may be discontinued or nonrenewed:
1853 (a) if a condition described in Subsection (2) exists; or
1854 (b) for noncompliance with the insurer's:
1855 (i) minimum participation requirements; or
1856 (ii) employer contribution requirements.
1857 (5) A small employer health benefit plan may be discontinued or nonrenewed:
1858 (a) if a condition described in Subsection (2) exists; or
1859 (b) for noncompliance with the insurer's employer contribution requirements.
1860 (6) A small employer health benefit plan may be nonrenewed:
1861 (a) if a condition described in Subsection (2) exists; or
1862 (b) for noncompliance with the insurer's minimum participation requirements.
1863 (7) (a) Except as provided in Subsection (7)(d), an eligible employee may be
1864 discontinued if after issuance of coverage the eligible employee:
1865 (i) engages in an act or practice that constitutes fraud in connection with the coverage;
1866 or
1867 (ii) makes an intentional misrepresentation of material fact in connection with the
1868 coverage.
1869 (b) An eligible employee that is discontinued under Subsection (7)(a) may reenroll:
1870 (i) 12 months after the date of discontinuance; and
1871 (ii) if the plan sponsor's coverage is in effect at the time the eligible employee applies
1872 to reenroll.
1873 (c) At the time the eligible employee's coverage is discontinued under Subsection
1874 (7)(a), the insurer shall notify the eligible employee of the right to reenroll when coverage is
1875 discontinued.
1876 (d) An eligible employee may not be discontinued under this Subsection (7) because of
1877 a fraud or misrepresentation that relates to health status.

1878 (8) (a) Except as provided in Subsection (8)(b), an insurer that elects to discontinue
1879 offering a health benefit plan under Subsection (3)(e) shall be prohibited from writing new
1880 business in such market in this state for a period of five years beginning on the date of
1881 discontinuation of the last coverage that is discontinued.
1882 (b) The commissioner may waive the prohibition under Subsection (8)(a) when the
1883 commissioner finds that waiver is in the public interest:
1884 (i) to promote competition; or
1885 (ii) to resolve inequity in the marketplace.
1886 (9) If an insurer is doing business in one established geographic service area of the
1887 state, this section applies only to the insurer's operations in that geographic service area.
1888 (10) An insurer may modify a health benefit plan for a plan sponsor only:
1889 (a) at the time of coverage renewal; and
1890 (b) if the modification is effective uniformly among all plans with a particular product
1891 or service.
1892 (11) For purposes of this section, a reference to "plan sponsor" includes a reference to
1893 the employer:
1894 (a) with respect to coverage provided to an employer member of the association; and
1895 (b) if the health benefit plan is made available by an insurer in the employer market
1896 only through:
1897 (i) an association;
1898 (ii) a trust; or
1899 (iii) a discretionary group.
1900 (12) (a) A small employer that, after purchasing a health benefit plan in the small group
1901 market, employs on average more than 50 eligible employees on each business day in a
1902 calendar year may continue to renew the health benefit plan purchased in the small group
1903 market.
1904 (b) A large employer that, after purchasing a health benefit plan in the large group
1905 market, employs on average less than 51 eligible employees on each business day in a calendar

1906 year may continue to renew the health benefit plan purchased in the large group market.
1907 (13) An insurer offering employer sponsored health benefit plans shall comply with the
1908 Health Insurance Portability and Accountability Act, [P. L. 104-191, 110 Stat. 1962, Sec. 2701
1909 and 2702] 42 U.S.C. Sec. 300gg and 300gg-1.
1910 Section 16. Section 31A-22-723 is amended to read:
1911 31A-22-723. Conversion from group coverage.
1912 (1) Notwithstanding Subsection 31A-1-103 (3)(f), and except as provided in Subsection
1913 (3), [all policies] a policy of accident and health insurance offered on a group basis under this
1914 title, or Title 49, Chapter 20, Public Employees' Benefit and Insurance Program Act, shall
1915 provide that a person whose insurance under the group policy has been terminated is entitled to
1916 choose a converted individual policy in accordance with this section and Section 31A-22-724 .
1917 (2) A person who has lost group coverage may elect conversion coverage with the
1918 insurer that provided prior group coverage if the person:
1919 (a) has been continuously covered for a period of three months by the group policy or
1920 the group's preceding policies immediately prior to termination;
1921 (b) has exhausted either:
1922 (i) Utah mini-COBRA coverage as required in Section 31A-22-722 ;
1923 (ii) federal COBRA coverage; or
1924 (iii) alternative coverage under Section 31A-22-724 ;
1925 (c) has not acquired or is not covered under any other group coverage that covers [all]
1926 preexisting conditions, including maternity, if the coverage exists; and
1927 (d) resides in the insurer's service area.
1928 (3) This section does not apply if the person's prior group coverage:
1929 (a) is a stand alone policy that only provides one of the following:
1930 (i) catastrophic benefits;
1931 (ii) aggregate stop loss benefits;
1932 (iii) specific stop loss benefits;
1933 (iv) benefits for specific diseases;

1934 (v) accidental injuries only;
1935 (vi) dental; or
1936 (vii) vision;
1937 (b) is an income replacement policy;
1938 (c) was terminated because the insured:
1939 (i) failed to pay any required individual contribution;
1940 (ii) performed an act or practice that constitutes fraud in connection with the coverage;
1941 or
1942 (iii) made intentional misrepresentation of material fact under the terms of coverage; or
1943 (d) was terminated pursuant to Subsection 31A-8-402.3 (2)(a), 31A-22-721 (2)(a), or
1944 31A-30-107 (2)(a).
1945 (4) (a) The [employer] insurer shall provide written notification of the right to an
1946 individual conversion policy within 30 days of the insurer receiving notice of, the insured's
1947 termination of COBRA or Utah mini-COBRA coverage to:
1948 (i) the terminated insured;
1949 (ii) the ex-spouse; or
1950 (iii) in the case of the death of the insured:
1951 (A) the surviving spouse; and
1952 (B) the guardian of any dependents, if different from a surviving spouse.
1953 (b) The notification required by Subsection (4)(a) shall:
1954 (i) be sent by first class mail;
1955 (ii) contain the name, address, and telephone number of the insurer that will provide
1956 the conversion coverage; and
1957 (iii) be sent to the insured's last-known address as shown on the records of the
1958 employer of:
1959 (A) the insured;
1960 (B) the ex-spouse; and
1961 (C) if the policy terminates by reason of the death of the insured to:

1962 (I) the surviving spouse; and
1963 (II) the guardian of any dependents, if different from a surviving spouse.
1964 (5) (a) An insurer is not required to issue a converted policy [which] that provides
1965 benefits in excess of those provided under the group policy from which conversion is made.
1966 (b) Except as provided in Subsection (5)(c), if the conversion is made from a health
1967 benefit plan, the employee or member shall be offered[: (i) at least the basic benefit plan as
1968 provided in Section 31A-22-613.5 through December 31, 2009; and (ii) beginning January 1,
1969 2010, only] the alternative coverage as provided in Subsection 31A-22-724 (1)(a).
1970 (c) If the benefit levels required under Subsection (5)(b) exceed the benefit levels
1971 provided under the group policy, the conversion policy may offer benefits [which] that are
1972 substantially similar to those provided under the group policy.
1973 (6) Written application for [the] a converted policy shall be made and the first premium
1974 paid to the insurer no later than [60] 30 days after [termination of the group accident and health
1975 insurance] the date of notice under Subsection (4)(a).
1976 (7) [The] A converted policy shall be issued without evidence of insurability.
1977 (8) (a) The initial premium for the converted policy for the first 12 months and
1978 subsequent renewal premiums shall be determined in accordance with premium rates
1979 applicable to age, class of risk of the person, and the type and amount of insurance provided.
1980 (b) The initial premium for the first 12 months may not be raised based on pregnancy
1981 of a covered insured.
1982 (c) The premium for converted policies shall be payable monthly or quarterly as
1983 required by the insurer for the policy form and plan selected, unless another mode or premium
1984 payment is mutually agreed upon.
1985 (9) [The] A converted policy becomes effective at the time the insurance under the
1986 group policy terminates.
1987 (10) (a) A newly issued converted policy covers the employee or the member and must
1988 also cover [all] dependents covered by the group policy at the date of termination of the group
1989 coverage.

1990 (b) The only dependents that may be added after the policy has been issued are children
1991 and dependents as required by Section 31A-22-610 and Subsections 31A-22-610.5 (6) and (7).
1992 (c) At the option of the insurer, a separate converted policy may be issued to cover
1993 [any] a dependent.
1994 (11) (a) To the extent [the] a group policy provided maternity benefits, [the] a
1995 conversion policy shall provide maternity benefits equal to the lesser of the maternity benefits
1996 of the group policy or the conversion policy until termination of a pregnancy that exists on the
1997 date of conversion if one of the following is pregnant on the date of the conversion:
1998 (i) the insured;
1999 (ii) a spouse of the insured; or
2000 (iii) a dependent of the insured.
2001 (b) [The requirements of this] This Subsection (11) [do] does not apply to a pregnancy
2002 that occurs after the date of conversion.
2003 (12) Except as provided in this Subsection (12), a converted policy is renewable with
2004 respect to [all individuals or dependents] an individual or dependent at the option of the
2005 insured. An insured may be terminated from a converted policy for the following reasons:
2006 (a) a dependent is no longer eligible under the converted policy;
2007 (b) for a network plan, if the individual no longer lives, resides, or works in:
2008 (i) the insured's service area; or
2009 (ii) the area for which the covered carrier is authorized to do business;
2010 (c) the individual fails to pay premiums or contributions in accordance with the terms
2011 of the converted policy, including any timeliness requirements;
2012 (d) the individual performs an act or practice that constitutes fraud in connection with
2013 the coverage;
2014 (e) the individual makes an intentional misrepresentation of material fact under the
2015 terms of the coverage; or
2016 (f) coverage is terminated uniformly without regard to any health status-related factor
2017 relating to any covered individual.

2018 (13) Conditions pertaining to health may not be used as a basis for classification under
2019 this section.
2020 (14) An insurer is only required to offer a conversion policy that complies with
2021 Subsection 31A-22-724 (1)(b) and, notwithstanding Sections 31A-8-402.5 and 31A-30-107.1 ,
2022 may discontinue any other conversion policy if:
2023 (a) the discontinued conversion policy is discontinued uniformly without regard to
2024 [any] a health related factor;
2025 (b) [any affected] an affected individual is provided with 90 days' advanced written
2026 notice of the discontinuation of the existing conversion policy;
2027 (c) the [policy holder] policyholder is offered the insurer's conversion policy that
2028 complies with Subsection 31A-22-724 (1)(b); and
2029 (d) the [policy holder] policyholder is not re-rated for purposes of premium calculation.
2030 (15) This section does not apply to a blanket accident and health insurance policy
2031 issued under Section 31A-22-701 .
2032 Section 17. Section 31A-23a-102 is amended to read:
2033 31A-23a-102. Definitions.
2034 As used in this chapter:
2035 (1) "Bail bond producer" means a person who:
2036 (a) is appointed by:
2037 (i) a surety insurer that issues bail bonds; or
2038 (ii) a bail bond surety company licensed under Chapter 35, Bail Bond Act;
2039 (b) is designated to execute or countersign undertakings of bail in connection with a
2040 judicial proceeding; and
2041 (c) receives or is promised money or other things of value for engaging in an act
2042 described in Subsection (1)(b).
2043 (2) "Escrow" means a license subline of authority in conjunction with the title
2044 insurance line of authority that allows a person to conduct escrow as defined in Section
2045 31A-1-301 .

2046 (3) "Home state" means a state or territory of the United States or the District of
2047 Columbia in which an insurance producer:
2048 (a) maintains the insurance producer's principal:
2049 (i) place of residence; or
2050 (ii) place of business; and
2051 (b) is licensed to act as an insurance producer.
2052 (4) "Insurer" is as defined in Section 31A-1-301 , except that the following persons or
2053 similar persons are not insurers for purposes of Part 7, Producer Controlled Insurers:
2054 (a) a risk retention group as defined in:
2055 (i) the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499;
2056 (ii) the Risk Retention Act, 15 U.S.C. Sec. 3901 et seq.; and
2057 (iii) Chapter 15, Part 2, Risk Retention Groups Act;
2058 (b) a residual market pool;
2059 (c) a joint underwriting authority or association; and
2060 (d) a captive insurer.
2061 (5) "License" is defined in Section 31A-1-301 .
2062 (6) (a) "Managing general agent" means a person that:
2063 (i) manages all or part of the insurance business of an insurer, including the
2064 management of a separate division, department, or underwriting office;
2065 (ii) acts as an agent for the insurer whether it is known as a managing general agent,
2066 manager, or other similar term;
2067 (iii) produces and underwrites an amount of gross direct written premium equal to, or
2068 more than 5% of, the policyholder surplus as reported in the last annual statement of the insurer
2069 in any one quarter or year:
2070 (A) with or without the authority;
2071 (B) separately or together with an affiliate; and
2072 (C) directly or indirectly; and
2073 (iv) (A) adjusts or pays claims in excess of an amount determined by the

2074 commissioner; or
2075 (B) negotiates reinsurance on behalf of the insurer.
2076 (b) Notwithstanding Subsection (6)(a), the following persons may not be considered as
2077 managing general agent for the purposes of this chapter:
2078 (i) an employee of the insurer;
2079 (ii) a United States manager of the United States branch of an alien insurer;
2080 (iii) an underwriting manager that, pursuant to contract:
2081 (A) manages all the insurance operations of the insurer;
2082 (B) is under common control with the insurer;
2083 (C) is subject to Chapter 16, Insurance Holding Companies; and
2084 (D) is not compensated based on the volume of premiums written; and
2085 (iv) the attorney-in-fact authorized by and acting for the subscribers of a reciprocal
2086 insurer or inter-insurance exchange under powers of attorney.
2087 (7) "Negotiate" means the act of conferring directly with or offering advice directly to a
2088 purchaser or prospective purchaser of a particular contract of insurance concerning a
2089 substantive benefit, term, or condition of the contract if the person engaged in that act:
2090 (a) sells insurance; or
2091 (b) obtains insurance from insurers for purchasers.
2092 (8) "Reinsurance intermediary" means:
2093 (a) a reinsurance intermediary-broker; or
2094 (b) a reinsurance intermediary-manager.
2095 (9) "Reinsurance intermediary-broker" means a person other than an officer or
2096 employee of the ceding insurer, firm, association, or corporation who solicits, negotiates, or
2097 places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority
2098 or power to bind reinsurance on behalf of the insurer.
2099 (10) (a) "Reinsurance intermediary-manager" means a person who:
2100 (i) has authority to bind or who manages all or part of the assumed reinsurance
2101 business of a reinsurer, including the management of a separate division, department, or

2102 underwriting office; and
2103 (ii) acts as an agent for the reinsurer whether the person is known as a reinsurance
2104 intermediary-manager, manager, or other similar term.
2105 (b) Notwithstanding Subsection (10)(a), the following persons may not be considered
2106 reinsurance intermediary-managers for the purpose of this chapter with respect to the reinsurer:
2107 (i) an employee of the reinsurer;
2108 (ii) a United States manager of the United States branch of an alien reinsurer;
2109 (iii) an underwriting manager that, pursuant to contract:
2110 (A) manages all the reinsurance operations of the reinsurer;
2111 (B) is under common control with the reinsurer;
2112 (C) is subject to Chapter 16, Insurance Holding Companies; and
2113 (D) is not compensated based on the volume of premiums written; and
2114 (iv) the manager of a group, association, pool, or organization of insurers that:
2115 (A) engage in joint underwriting or joint reinsurance; and
2116 (B) are subject to examination by the insurance commissioner of the state in which the
2117 manager's principal business office is located.
2118 (11) "Search" means a license subline of authority in conjunction with the title
2119 insurance line of authority that allows a person to issue title insurance commitments or policies
2120 on behalf of a title insurer.
2121 (12) "Sell" means to exchange a contract of insurance:
2122 (a) by any means;
2123 (b) for money or its equivalent; and
2124 (c) on behalf of an insurance company.
2125 (13) "Solicit" means:
2126 (a) attempting to sell insurance;
2127 (b) asking or urging a person to apply for:
2128 (i) a particular kind of insurance; and
2129 (ii) insurance from a particular insurance company;

2130 (c) advertising insurance, including advertising for the purpose of obtaining leads for
2131 the sale of insurance; or
2132 (d) holding oneself out as being in the insurance business.
2133 (14) "Terminate" means:
2134 (a) the cancellation of the relationship between:
2135 (i) an individual licensee or agency licensee and a particular insurer; or
2136 (ii) an individual licensee and a particular agency licensee; or
2137 (b) the termination of:
2138 (i) an individual licensee's or agency licensee's authority to transact insurance on behalf
2139 of a particular insurance company; or
2140 (ii) an individual licensee's authority to transact insurance on behalf of a particular
2141 agency licensee.
2142 (15) "Title marketing representative" means a person who:
2143 (a) represents a title insurer in soliciting, requesting, or negotiating the placing of:
2144 (i) title insurance; or
2145 (ii) escrow services; and
2146 (b) does not have a search or escrow license as provided in Section 31A-23a-106 .
2147 (16) "Uniform application" means the version of the National Association of Insurance
2148 [Commissioner's] Commissioners' uniform application for resident and nonresident producer
2149 licensing at the time the application is filed.
2150 (17) "Uniform business entity application" means the version of the National
2151 Association of Insurance [Commissioner's] Commissioners' uniform business entity application
2152 for resident and nonresident business entities at the time the application is filed.
2153 Section 18. Section 31A-23a-106 is amended to read:
2154 31A-23a-106. License types.
2155 (1) (a) A resident or nonresident license issued under this chapter shall be issued under
2156 the license types described under Subsection (2).
2157 (b) A license type and a line of authority pertaining to a license type describe the type

2158 of licensee and the lines of business that a licensee may sell, solicit, or negotiate. A license type
2159 is intended to describe the matters to be considered under any education, examination, and
2160 training required of a license applicant under Sections 31A-23a-108 , 31A-23a-202 , and
2161 31A-23a-203 .
2162 (2) (a) A producer license type includes the following lines of authority:
2163 (i) life insurance, including a nonvariable contract;
2164 (ii) variable contracts, including variable life and annuity, if the producer has the life
2165 insurance line of authority;
2166 (iii) accident and health insurance, including a contract issued to a policyholder under
2167 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2168 Organizations and Limited Health Plans;
2169 (iv) property insurance;
2170 (v) casualty insurance, including a surety or other bond;
2171 (vi) title insurance under one or more of the following categories:
2172 (A) search, including authority to act as a title marketing representative;
2173 (B) escrow, including authority to act as a title marketing representative; and
2174 (C) title marketing representative only;
2175 (vii) personal lines insurance; and
2176 (viii) surplus lines, if the producer has the property or casualty or both lines of
2177 authority.
2178 (b) A limited line producer license type includes the following limited lines of
2179 authority:
2180 (i) limited line credit insurance;
2181 (ii) travel insurance;
2182 (iii) motor club insurance;
2183 (iv) car rental related insurance;
2184 (v) legal expense insurance;
2185 (vi) crop insurance;

2186 (vii) self-service storage insurance; [and]
2187 (viii) bail bond producer[.]; and
2188 (ix) guaranteed asset protection waiver.
2189 (c) A customer service representative license type includes the following lines of
2190 authority, if held by the customer service representative's employer producer:
2191 (i) life insurance, including a nonvariable contract;
2192 (ii) accident and health insurance, including a contract issued to a policyholder under
2193 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2194 Organizations and Limited Health Plans;
2195 (iii) property insurance;
2196 (iv) casualty insurance, including a surety or other bond;
2197 (v) personal lines insurance; and
2198 (vi) surplus lines, if the employer producer has the property or casualty or both lines of
2199 authority.
2200 (d) A consultant license type includes the following lines of authority:
2201 (i) life insurance, including a nonvariable contract;
2202 (ii) variable contracts, including variable life and annuity, if the consultant has the life
2203 insurance line of authority;
2204 (iii) accident and health insurance, including a contract issued to a policyholder under
2205 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2206 Organizations and Limited Health Plans;
2207 (iv) property insurance;
2208 (v) casualty insurance, including a surety or other bond; and
2209 (vi) personal lines insurance.
2210 (e) A managing general agent license type includes the following lines of authority:
2211 (i) life insurance, including a nonvariable contract;
2212 (ii) variable contracts, including variable life and annuity, if the managing general
2213 agent has the life insurance line of authority;

2214 (iii) accident and health insurance, including a contract issued to a policyholder under
2215 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2216 Organizations and Limited Health Plans;
2217 (iv) property insurance;
2218 (v) casualty insurance, including a surety or other bond; and
2219 (vi) personal lines insurance.
2220 (f) A reinsurance intermediary license type includes the following lines of authority:
2221 (i) life insurance, including a nonvariable contract;
2222 (ii) variable contracts, including variable life and annuity, if the reinsurance
2223 intermediary has the life insurance line of authority;
2224 (iii) accident and health insurance, including a contract issued to a policyholder under
2225 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2226 Organizations and Limited Health Plans;
2227 (iv) property insurance;
2228 (v) casualty insurance, including a surety or other bond; and
2229 (vi) personal lines insurance.
2230 (g) A [holder of licenses] person who holds a license under [Subsections] Subsection
2231 (2)(a), (d), (e), [and] or (f) has [all] the qualifications necessary to act as a holder of a license
2232 under Subsections (2)(b) and (c), except that the person may not act under Subsection
2233 (2)(b)(viii) or (ix).
2234 (3) (a) The commissioner may by rule recognize other producer, limited line producer,
2235 customer service representative, consultant, managing general agent, or reinsurance
2236 intermediary lines of authority as to kinds of insurance not listed under Subsections (2)(a)
2237 through (f).
2238 (b) Notwithstanding Subsection (3)(a), for purposes of title insurance the Title and
2239 Escrow Commission may by rule, with the concurrence of the commissioner and subject to
2240 Section 31A-2-404 , recognize other categories for a title insurance producer line of authority
2241 not listed under Subsection (2)(a)(vi).

2242 (4) The variable contracts, including variable life and annuity line of authority requires:
2243 (a) licensure as a registered agent or broker by the [National Association of Securities
2244 Dealers] Financial Industry Regulatory Authority; and
2245 (b) current registration with a securities broker-dealer.
2246 (5) A surplus lines producer is a producer who has a surplus lines line of authority.
2247 Section 19. Section 31A-23a-111 is amended to read:
2248 31A-23a-111. Revocation, suspension, surrender, lapsing, limiting, or otherwise
2249 terminating a license -- Rulemaking for renewal or reinstatement.
2250 (1) A license type issued under this chapter remains in force until:
2251 (a) revoked or suspended under Subsection (5);
2252 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
2253 administrative action;
2254 (c) the licensee dies or is adjudicated incompetent as defined under:
2255 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2256 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2257 Minors;
2258 (d) lapsed under Section 31A-23a-113 ; or
2259 (e) voluntarily surrendered.
2260 (2) The following may be reinstated within one year after the day on which the license
2261 is no longer in force:
2262 (a) a lapsed license; or
2263 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
2264 not be reinstated after the license period in which the license is voluntarily surrendered.
2265 (3) Unless otherwise stated in [the] a written agreement for the voluntary surrender of a
2266 license, submission and acceptance of a voluntary surrender of a license does not prevent the
2267 department from pursuing additional disciplinary or other action authorized under:
2268 (a) this title; or
2269 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah

2270 Administrative Rulemaking Act.
2271 (4) A line of authority issued under this chapter remains in force until:
2272 (a) the qualifications pertaining to a line of authority are no longer met by the licensee;
2273 or
2274 (b) the supporting license type:
2275 (i) is revoked or suspended under Subsection (5);
2276 (ii) is surrendered to the commissioner and accepted by the commissioner in lieu of
2277 administrative action;
2278 (iii) the licensee dies or is adjudicated incompetent as defined under:
2279 (A) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2280 (B) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2281 Minors;
2282 (iv) lapsed under Section 31A-23a-113 ; or
2283 (v) voluntarily surrendered.
2284 (5) (a) If the commissioner makes a finding under Subsection (5)(b), as part of an
2285 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
2286 commissioner may:
2287 (i) revoke:
2288 (A) a license; or
2289 (B) a line of authority;
2290 (ii) suspend for a specified period of 12 months or less:
2291 (A) a license; or
2292 (B) a line of authority;
2293 (iii) limit in whole or in part:
2294 (A) a license; or
2295 (B) a line of authority; or
2296 (iv) deny a license application.
2297 (b) The commissioner may take an action described in Subsection (5)(a) if the

2298 commissioner finds that the licensee:
2299 (i) is unqualified for a license or line of authority under Section 31A-23a-104 ,
2300 31A-23a-105 , or 31A-23a-107 ;
2301 (ii) violates:
2302 (A) an insurance statute;
2303 (B) a rule that is valid under Subsection 31A-2-201 (3); or
2304 (C) an order that is valid under Subsection 31A-2-201 (4);
2305 (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
2306 delinquency proceedings in any state;
2307 (iv) fails to pay a final judgment rendered against the person in this state within 60
2308 days after the day on which the judgment became final;
2309 (v) fails to meet the same good faith obligations in claims settlement that is required of
2310 admitted insurers;
2311 (vi) is affiliated with and under the same general management or interlocking
2312 directorate or ownership as another insurance producer that transacts business in this state
2313 without a license;
2314 (vii) refuses:
2315 (A) to be examined; or
2316 (B) to produce its accounts, records, and files for examination;
2317 (viii) has an officer who refuses to:
2318 (A) give information with respect to the insurance producer's affairs; or
2319 (B) perform any other legal obligation as to an examination;
2320 (ix) provides information in the license application that is:
2321 (A) incorrect;
2322 (B) misleading;
2323 (C) incomplete; or
2324 (D) materially untrue;
2325 (x) violates an insurance law, valid rule, or valid order of another state's insurance

2326 department;
2327 (xi) obtains or attempts to obtain a license through misrepresentation or fraud;
2328 (xii) improperly withholds, misappropriates, or converts money or properties received
2329 in the course of doing insurance business;
2330 (xiii) intentionally misrepresents the terms of an actual or proposed:
2331 (A) insurance contract;
2332 (B) application for insurance; or
2333 (C) life settlement;
2334 (xiv) is convicted of a felony;
2335 (xv) admits or is found to have committed an insurance unfair trade practice or fraud;
2336 (xvi) in the conduct of business in this state or elsewhere:
2337 (A) uses fraudulent, coercive, or dishonest practices; or
2338 (B) demonstrates incompetence, untrustworthiness, or financial irresponsibility;
2339 (xvii) has an insurance license, or its equivalent, denied, suspended, or revoked in
2340 another state, province, district, or territory;
2341 (xviii) forges another's name to:
2342 (A) an application for insurance; or
2343 (B) a document related to an insurance transaction;
2344 (xix) improperly uses notes or another reference material to complete an examination
2345 for an insurance license;
2346 (xx) knowingly accepts insurance business from an individual who is not licensed;
2347 (xxi) fails to comply with an administrative or court order imposing a child support
2348 obligation;
2349 (xxii) fails to:
2350 (A) pay state income tax; or
2351 (B) comply with an administrative or court order directing payment of state income
2352 tax;
2353 (xxiii) violates or permits others to violate the federal Violent Crime Control and Law

2354 Enforcement Act of 1994, 18 U.S.C. [Secs.] Sec. 1033 and 1034; or
2355 (xxiv) engages in a method or practice in the conduct of business that endangers the
2356 legitimate interests of customers and the public.
2357 (c) For purposes of this section, if a license is held by an agency, both the agency itself
2358 and any individual designated under the license are considered to be the holders of the license.
2359 (d) If an individual designated under the agency license commits an act or fails to
2360 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
2361 the commissioner may suspend, revoke, or limit the license of:
2362 (i) the individual;
2363 (ii) the agency, if the agency:
2364 (A) is reckless or negligent in its supervision of the individual; or
2365 (B) knowingly participates in the act or failure to act that is the ground for suspending,
2366 revoking, or limiting the license; or
2367 (iii) (A) the individual; and
2368 (B) the agency if the agency meets the requirements of Subsection (5)(d)(ii).
2369 (6) A licensee under this chapter is subject to the penalties for acting as a licensee
2370 without a license if:
2371 (a) the licensee's license is:
2372 (i) revoked;
2373 (ii) suspended;
2374 (iii) limited;
2375 (iv) surrendered in lieu of administrative action;
2376 (v) lapsed; or
2377 (vi) voluntarily surrendered; and
2378 (b) the licensee:
2379 (i) continues to act as a licensee; or
2380 (ii) violates the terms of the license limitation.
2381 (7) A licensee under this chapter shall immediately report to the commissioner:

2382 (a) a revocation, suspension, or limitation of the person's license in another state, the
2383 District of Columbia, or a territory of the United States;
2384 (b) the imposition of a disciplinary sanction imposed on that person by another state,
2385 the District of Columbia, or a territory of the United States; or
2386 (c) a judgment or injunction entered against that person on the basis of conduct
2387 involving:
2388 (i) fraud;
2389 (ii) deceit;
2390 (iii) misrepresentation; or
2391 (iv) a violation of an insurance law or rule.
2392 (8) (a) An order revoking a license under Subsection (5) or an agreement to surrender a
2393 license in lieu of administrative action may specify a time, not to exceed five years, within
2394 which the former licensee may not apply for a new license.
2395 (b) If no time is specified in an order or agreement described in Subsection (8)(a), the
2396 former licensee may not apply for a new license for five years from the day on which the order
2397 or agreement is made without the express approval by the commissioner.
2398 (9) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
2399 a license issued under this part if so ordered by a court.
2400 (10) The commissioner shall by rule prescribe the license renewal and reinstatement
2401 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
2402 Section 20. Section 31A-23a-202 is amended to read:
2403 31A-23a-202. Continuing education requirements.
2404 (1) Pursuant to this section, the commissioner shall by rule prescribe the continuing
2405 education requirements for a producer and a consultant.
2406 (2) (a) The commissioner may not state a continuing education requirement in terms of
2407 formal education.
2408 (b) The commissioner may state a continuing education requirement in terms of
2409 [classroom hours, or their equivalent,] hours of insurance-related instruction received.

2410 (c) Insurance-related formal education may be a substitute, in whole or in part, for
2411 [classroom hours, or their equivalent,] the hours required under Subsection (2)(b).
2412 (3) (a) The commissioner shall impose continuing education requirements in
2413 accordance with a two-year licensing period in which the licensee meets the requirements of
2414 this Subsection (3).
2415 (b) (i) Except as provided in this section, the continuing education requirements shall
2416 require:
2417 (A) that a licensee complete 24 credit hours of continuing education for every two-year
2418 licensing period;
2419 (B) that 3 of the 24 credit hours described in Subsection (3)(b)(i)(A) be ethics courses;
2420 and
2421 (C) that the licensee complete at least half of the required hours through classroom
2422 hours of insurance-related instruction.
2423 (ii) [The hours not completed through classroom hours] An hour of continuing
2424 education in accordance with Subsection (3)(b)(i)[(C)] may be obtained through:
2425 (A) classroom attendance;
2426 [(A)] (B) home study;
2427 [(B)] (C) watching a video recording;
2428 [(C)] (D) experience credit; or
2429 [(D)] (E) another method provided by rule.
2430 (iii) (A) Notwithstanding Subsections (3)(b)(i)(A) and (B), a title insurance producer is
2431 required to complete 12 credit hours of continuing education for every two-year licensing
2432 period, with 3 of the credit hours being ethics courses unless the title insurance producer is
2433 licensed in this state as a title insurance producer for 20 or more consecutive years.
2434 (B) If a title insurance producer is licensed in this state as a title insurance producer for
2435 20 or more consecutive years, the title insurance producer is required to complete 6 credit hours
2436 of continuing education for every two-year licensing period, with 3 of the credit hours being
2437 ethics courses.

2438 (C) Notwithstanding Subsection (3)(b)(iii)(A) or (B), a title insurance producer is
2439 considered to have met the continuing education requirements imposed under Subsection
2440 (3)(b)(iii)(A) or (B) if the title insurance producer:
2441 (I) is an active member in good standing with the Utah State Bar;
2442 (II) is in compliance with the continuing education requirements of the Utah State Bar;
2443 and
2444 (III) if requested by the department, provides the department evidence that the title
2445 insurance producer complied with the continuing education requirements of the Utah State Bar.
2446 (c) A licensee may obtain continuing education hours at any time during the two-year
2447 licensing period.
2448 (d) (i) A licensee is exempt from continuing education requirements under this section
2449 if:
2450 (A) the licensee was first licensed before April 1, 1978;
2451 (B) the license does not have a continuous lapse for a period of more than one year,
2452 except for a license for which the licensee has had an exemption approved before May 11,
2453 2011;
2454 [(B)] (C) the licensee requests an exemption from the department; and
2455 [(C)] (D) the department approves the exemption.
2456 (ii) If the department approves the exemption under Subsection (3)(d)(i), the licensee is
2457 not required to apply again for the exemption.
2458 (e) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2459 commissioner shall, by rule:
2460 (i) publish a list of insurance professional designations whose continuing education
2461 requirements can be used to meet the requirements for continuing education under Subsection
2462 (3)(b);
2463 (ii) authorize a continuing education provider or a state or national professional
2464 producer or consultant association to:
2465 (A) offer a qualified program for a license type or line of authority on a geographically

2466 accessible basis; and
2467 (B) collect a reasonable fee for funding and administration of a continuing education
2468 program, subject to the review and approval of the commissioner; and
2469 (iii) provide that membership by a producer or consultant in a state or national
2470 professional producer or consultant association is considered a substitute for the equivalent of
2471 two hours for each year during which the producer or consultant is a member of the
2472 professional association, except that the commissioner may not give more than two hours of
2473 continuing education credit in a year regardless of the number of professional associations of
2474 which the producer or consultant is a member.
2475 (f) A fee permitted under Subsection (3)(e)(ii)(B) that is charged for attendance at a
2476 professional producer or consultant association program may be less for an association
2477 member, on the basis of the member's affiliation expense, but shall preserve the right of a
2478 nonmember to attend without affiliation.
2479 (4) The commissioner shall approve a continuing education provider or continuing
2480 education course that satisfies the requirements of this section.
2481 (5) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2482 commissioner shall by rule set the processes and procedures for continuing education provider
2483 registration and course approval.
2484 (6) The requirements of this section apply only to a producer or consultant who is an
2485 individual.
2486 (7) A nonresident producer or consultant is considered to have satisfied this state's
2487 continuing education requirements if the nonresident producer or consultant satisfies the
2488 nonresident producer's or consultant's home state's continuing education requirements for a
2489 licensed insurance producer or consultant.
2490 (8) A producer or consultant subject to this section shall keep documentation of
2491 completing the continuing education requirements of this section for two years after the end of
2492 the two-year licensing period to which the continuing education applies.
2493 Section 21. Section 31A-23a-203 is amended to read:

2494 31A-23a-203. Training period requirements.
2495 (1) A producer is eligible to add the surplus lines of authority to the person's producer's
2496 license if the producer:
2497 (a) has passed the applicable examination;
2498 (b) has been a producer with property and casualty lines of authority for at least three
2499 years during the four years immediately preceding the date of application; and
2500 (c) has paid the applicable fee under Section 31A-3-103 .
2501 (2) A person is eligible to become a consultant only if the person has acted in a
2502 capacity that would provide the person with preparation to act as an insurance consultant for a
2503 period aggregating not less than three years during the four years immediately preceding the
2504 date of application.
2505 (3) (a) A resident producer with an accident and health line of authority may only sell
2506 long-term care insurance if the producer:
2507 (i) initially completes a minimum of three hours of long-term care training before
2508 selling long-term care coverage; and
2509 (ii) after completing the training required by Subsection (3)(a)(i), completes a
2510 minimum of three hours of long-term care training during each subsequent two-year licensing
2511 period.
2512 (b) A course taken to satisfy a long-term care training requirement may be used toward
2513 satisfying a producer continuing education requirement.
2514 (c) Long-term care training is not a continuing education requirement to renew a
2515 producer license.
2516 (d) An insurer that issues long-term care insurance shall demonstrate to the
2517 commissioner, upon request, that a producer who is appointed by the insurer and who sells
2518 long-term care insurance coverage is in compliance with this Subsection (3).
2519 [(3)] (4) The training periods required under this section apply only to an individual
2520 applying for a license under this chapter.
2521 Section 22. Section 31A-23a-204 is amended to read:

2522 31A-23a-204. Special requirements for title insurance producers and agencies.
2523 A title insurance producer, including an agency, shall be licensed in accordance with
2524 this chapter, with the additional requirements listed in this section.
2525 (1) (a) A person that receives a new license under this title as a title insurance agency,
2526 shall at the time of licensure be owned or managed by [one or more individuals who are] at
2527 least one individual who is licensed for at least three of the five years immediately [proceeding]
2528 preceding the date on which the title insurance agency applies for a license with both:
2529 (i) a search line of authority; and
2530 (ii) an escrow line of authority.
2531 (b) A title insurance agency subject to Subsection (1)(a) may comply with Subsection
2532 (1)(a) by having the title insurance agency owned or managed by:
2533 (i) one or more individuals who are licensed with the search line of authority for the
2534 time period provided in Subsection (1)(a); and
2535 (ii) one or more individuals who are licensed with the escrow line of authority for the
2536 time period provided in Subsection (1)(a).
2537 (c) A person licensed as a title insurance agency shall at all times during the term of
2538 licensure be owned or managed by at least one individual who is licensed for at least three
2539 years within the preceding five-year period with both:
2540 (i) a search line of authority; and
2541 (ii) an escrow line of authority.
2542 [(c)] (d) The Title and Escrow Commission may by rule, subject to Section 31A-2-404 ,
2543 exempt an attorney with real estate experience from the experience requirements in Subsection
2544 (1)(a).
2545 (2) (a) A title insurance agency or producer appointed by an insurer shall maintain:
2546 (i) a fidelity bond;
2547 (ii) a professional liability insurance policy; or
2548 (iii) a financial protection:
2549 (A) equivalent to that described in Subsection (2)(a)(i) or (ii); and

2550 (B) that the commissioner considers adequate.
2551 (b) The bond, insurance, or financial protection required by this Subsection (2):
2552 (i) shall be supplied under a contract approved by the commissioner to provide
2553 protection against the improper performance of any service in conjunction with the issuance of
2554 a contract or policy of title insurance; and
2555 (ii) be in a face amount no less than $50,000.
2556 (c) The Title and Escrow Commission may by rule, subject to Section 31A-2-404 ,
2557 exempt title insurance producers from the requirements of this Subsection (2) upon a finding
2558 that, and only so long as, the required policy or bond is generally unavailable at reasonable
2559 rates.
2560 (3) A title insurance agency or producer appointed by an insurer may maintain a
2561 reserve fund to the extent monies were deposited before July 1, 2008, and not withdrawn to the
2562 income of the title insurance producer.
2563 (4) An examination for licensure shall include questions regarding the search and
2564 examination of title to real property.
2565 (5) A title insurance producer may not perform the functions of escrow unless the title
2566 insurance producer has been examined on the fiduciary duties and procedures involved in those
2567 functions.
2568 (6) The Title and Escrow Commission shall adopt rules, subject to Section 31A-2-404 ,
2569 after consulting with the department and the department's test administrator, establishing an
2570 examination for a license that will satisfy this section.
2571 (7) A license may be issued to a title insurance producer who has qualified:
2572 (a) to perform only searches and examinations of title as specified in Subsection (4);
2573 (b) to handle only escrow arrangements as specified in Subsection (5); or
2574 (c) to act as a title marketing representative.
2575 (8) (a) A person licensed to practice law in Utah is exempt from the requirements of
2576 Subsections (2) and (3) if that person issues 12 or less policies in any 12-month period.
2577 (b) In determining the number of policies issued by a person licensed to practice law in

2578 Utah for purposes of Subsection (8)(a), if the person licensed to practice law in Utah issues a
2579 policy to more than one party to the same closing, the person is considered to have issued only
2580 one policy.
2581 (9) A person licensed to practice law in Utah, whether exempt under Subsection (8) or
2582 not, shall maintain a trust account separate from a law firm trust account for all title and real
2583 estate escrow transactions.
2584 Section 23. Section 31A-23a-406 is amended to read:
2585 31A-23a-406. Title insurance producer's business.
2586 (1) A title insurance producer may do escrow involving real property transactions if all
2587 of the following exist:
2588 (a) the title insurance producer is licensed with:
2589 (i) the title line of authority; and
2590 (ii) the escrow subline of authority;
2591 (b) the title insurance producer is appointed by a title insurer authorized to do business
2592 in the state;
2593 (c) the title insurance producer issues one or more of the following [is to be issued] as
2594 part of the transaction:
2595 (i) an owner's policy of title insurance; or
2596 (ii) a lender's policy of title insurance;
2597 (d) [(i) all funds] money deposited with the title insurance producer in connection with
2598 any escrow:
2599 [(A) are] (i) is deposited:
2600 [(I)] (A) in a federally insured financial institution; and
2601 [(II)] (B) in a trust account that is separate from all other trust account [funds that are]
2602 money that is not related to real estate transactions; [and]
2603 [(B) are] (ii) is the property of the one or more persons entitled to [them] the money
2604 under the provisions of the escrow; and
2605 [(ii) are] (iii) is segregated escrow by escrow in the records of the title insurance

2606 producer;
2607 (e) earnings on [funds] money held in escrow may be paid out of the escrow account to
2608 any person in accordance with the conditions of the escrow; [and]
2609 (f) the escrow does not require the title insurance producer to hold:
2610 (i) construction [funds] money; or
2611 (ii) [funds] money held for exchange under Section 1031, Internal Revenue Code[.];
2612 and
2613 (g) the title insurance producer shall maintain a physical office in Utah staffed by a
2614 person with an escrow subline of authority who processes the escrow.
2615 (2) Notwithstanding Subsection (1), a title insurance producer may engage in the
2616 escrow business if:
2617 (a) the escrow involves:
2618 (i) a mobile home;
2619 (ii) a grazing right;
2620 (iii) a water right; or
2621 (iv) other personal property authorized by the commissioner; and
2622 (b) the title insurance producer complies with [all the requirements of] this section
2623 except for [the requirement of] Subsection (1)(c).
2624 (3) [Funds] Money held in escrow:
2625 (a) [are] is not subject to any debts of the title insurance producer;
2626 (b) may only be used to fulfill the terms of the individual escrow under which the
2627 [funds were] money is accepted; and
2628 (c) may not be used until [all] the conditions of the escrow [have been] are met.
2629 (4) Assets or property other than escrow [funds] money received by a title insurance
2630 producer in accordance with an escrow shall be maintained in a manner that will:
2631 (a) reasonably preserve and protect the asset or property from loss, theft, or damages;
2632 and
2633 (b) otherwise comply with [all] the general duties and responsibilities of a fiduciary or

2634 bailee.
2635 (5) (a) A check from the trust account described in Subsection (1)(d) may not be
2636 drawn, executed, or dated, or [funds] money otherwise disbursed unless the segregated escrow
2637 account from which [funds are] money is to be disbursed contains a sufficient credit balance
2638 consisting of collected [or] and cleared [funds] money at the time the check is drawn, executed,
2639 or dated, or [funds are] money is otherwise disbursed.
2640 (b) As used in this Subsection (5), [funds are] money is considered to be "collected [or]
2641 and cleared," and may be disbursed as follows:
2642 (i) cash may be disbursed on the same day the cash is deposited;
2643 (ii) a wire transfer may be disbursed on the same day the wire transfer is deposited; and
2644 [(iii) the following may be disbursed on the day following the date of deposit:]
2645 [(A) a cashier's check;]
2646 [(B) a certified check;]
2647 [(C) a teller's check;]
2648 [(D) a U.S. Postal Service money order; and]
2649 [(E) a check drawn on a Federal Reserve Bank or Federal Home Loan Bank; and]
2650 [(iv) any other check or deposit may be disbursed:]
2651 [(A) within the time limits provided under the Expedited Funds Availability Act, 12
2652 U.S.C. Section 4001 et seq., as amended, and related regulations of the Federal Reserve
2653 System; or]
2654 [(B) upon written notification from the financial institution to which the funds have
2655 been deposited, that final settlement has occurred on the deposited item.]
2656 [(c) Subject to Subsections (5)(a) and (b), any material change to a settlement
2657 statement made after the final closing documents are executed must be authorized or
2658 acknowledged by date and signature on each page of the settlement statement by the one or
2659 more persons affected by the change before disbursement of funds.]
2660 (iii) the proceeds of one or more of the following financial instruments may be
2661 disbursed on the same day the financial instruments are deposited if received from a single

2662 party to the real estate transaction and if the aggregate of the financial instruments for the real
2663 estate transaction is less than $10,000:
2664 (A) a cashier's check, certified check, or official check that is drawn on an existing
2665 account at a federally insured financial institution;
2666 (B) a check drawn on the trust account of a principal broker or associate broker
2667 licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices Act, if the title
2668 producer has reasonable and prudent grounds to believe sufficient money will be available
2669 from the trust account on which the check is drawn at the time of disbursement of proceeds
2670 from the title producer's escrow account;
2671 (C) a personal check not to exceed $500 per closing;
2672 (D) a check drawn on the escrow account of another title producer, if the title producer
2673 in the escrow transaction has reasonable and prudent grounds to believe that sufficient money
2674 will be available for withdrawal from the account upon which the check is drawn at the time of
2675 disbursement of money from the escrow account of the title producer in the escrow transaction;
2676 or
2677 (E) a check issued by a farm credit service authorized under the Farm Credit Act of
2678 1971, 12 U.S.C. Sec. 2001 et seq., as amended.
2679 (c) Money received from a financial instrument described in Subsection (5)(b)(iii)(B)
2680 or (C) may be disbursed:
2681 (i) within the time limits provided under the Expedited Funds Availability Act, 12
2682 U.S.C. Sec. 4001 et seq., as amended, and related regulations of the Federal Reserve System; or
2683 (ii) upon notification from the financial institution to which the money has been
2684 deposited that final settlement has occurred on the deposited financial instrument.
2685 (6) [The] A title insurance producer shall maintain [records of all receipts and
2686 disbursements of escrow funds] a record of a receipt or disbursement of escrow money.
2687 (7) [The] A title insurance producer shall comply with:
2688 (a) Section 31A-23a-409 ;
2689 (b) Title 46, Chapter 1, Notaries Public Reform Act; and

2690 (c) any rules adopted by the Title and Escrow Commission, subject to Section
2691 31A-2-404 , that govern escrows.
2692 (8) If a title insurance producer conducts a search for real estate located in the state, the
2693 title insurance producer shall conduct a minimum mandatory search, as defined by rule made
2694 by the Title and Escrow Commission, subject to Section 31A-2-404 .
2695 Section 24. Section 31A-23a-408 is amended to read:
2696 31A-23a-408. Representations of agency.
2697 [No] A person may not represent [himself as] that the person is acting in behalf of an
2698 insurer unless a written agency contract is in effect giving the person authority from the insurer
2699 and the insurer [has appointed] appoints that person to act in behalf of the insurer.
2700 Section 25. Section 31A-23a-412 is amended to read:
2701 31A-23a-412. Place of business and residence address -- Records.
2702 (1) (a) [All licensees] A licensee under this chapter shall register and maintain with the
2703 commissioner:
2704 (i) the address and telephone numbers of [their] the licensee's principal place of
2705 business[.]; and
2706 (ii) a valid business email address at which the commissioner may contact the licensee.
2707 (b) If [the] a licensee is an individual, in addition to complying with Subsection (1)(a)
2708 the individual shall [provide to] register and maintain with the commissioner the individual's
2709 residence address and telephone number.
2710 (c) A licensee shall notify the commissioner within 30 days of [any] a change of any of
2711 the following required to be registered with the commissioner under this section:
2712 (i) an address [or];
2713 (ii) a telephone number[.]; or
2714 (iii) a business email address.
2715 (2) (a) Except as provided under Subsection (3), [every] a licensee under this chapter
2716 shall keep at the principal place of business address registered under Subsection (1), separate
2717 and distinct books and records of [all] the transactions consummated under the Utah license.

2718 (b) The books and records described in Subsection (2)(a) shall:
2719 (i) be in an organized form;
2720 (ii) be available to the commissioner for inspection upon reasonable notice; and
2721 (iii) include all of the following:
2722 (A) if the licensee is a producer, limited line producer, consultant, managing general
2723 agent, or reinsurance intermediary:
2724 (I) a record of each insurance contract procured by or issued through the licensee, with
2725 the names of insurers and insureds, the amount of premium and commissions or other
2726 compensation, and the subject of the insurance;
2727 (II) the names of any other producers, limited line producers, consultants, managing
2728 general agents, or reinsurance intermediaries from whom business is accepted, and of persons
2729 to whom commissions or allowances of any kind are promised or paid; and
2730 (III) a record of [all] the consumer complaints forwarded to the licensee by an
2731 insurance regulator;
2732 (B) if the licensee is a consultant, a record of each agreement outlining the work
2733 performed and the fee for the work; and
2734 (C) any additional information which:
2735 (I) is customary for a similar business; or
2736 (II) may reasonably be required by the commissioner by rule.
2737 (3) Subsection (2) is satisfied if the books and records specified in Subsection (2) can
2738 be obtained immediately from a central storage place or elsewhere by on-line computer
2739 terminals located at the registered address.
2740 (4) A licensee who represents only a single insurer satisfies Subsection (2) if the
2741 insurer maintains the books and records pursuant to Subsection (2) at a place satisfying
2742 Subsections (1) and (5).
2743 (5) (a) The books and records maintained under Subsection (2) or Section
2744 31A-23a-413 shall be available for the inspection of the commissioner during all business
2745 hours for a period of time after the date of the transaction as specified by the commissioner by

2746 rule, but in no case for less than the current calendar year plus three years.
2747 (b) Discarding books and records after the applicable record retention period has
2748 expired does not place the licensee in violation of a later-adopted longer record retention
2749 period.
2750 Section 26. Section 31A-23a-415 is amended to read:
2751 31A-23a-415. Assessment on title insurance agencies or title insurers -- Account
2752 created.
2753 (1) For purposes of this section:
2754 (a) "Premium" is as defined in Subsection 59-9-101 (3).
2755 (b) "Title insurer" means a person:
2756 (i) making any contract or policy of title insurance as:
2757 (A) insurer;
2758 (B) guarantor; or
2759 (C) surety;
2760 (ii) proposing to make any contract or policy of title insurance as:
2761 (A) insurer;
2762 (B) guarantor; or
2763 (C) surety; or
2764 (iii) transacting or proposing to transact any phase of title insurance, including:
2765 (A) soliciting;
2766 (B) negotiating preliminary to execution;
2767 (C) executing of a contract of title insurance;
2768 (D) insuring; and
2769 (E) transacting matters subsequent to the execution of the contract and arising out of
2770 the contract.
2771 (c) "Utah risks" means insuring, guaranteeing, or indemnifying with regard to real or
2772 personal property located in Utah, an owner of real or personal property, the holders of liens or
2773 encumbrances on that property, or others interested in the property against loss or damage

2774 suffered by reason of:
2775 (i) liens or encumbrances upon, defects in, or the unmarketability of the title to the
2776 property; or
2777 (ii) invalidity or unenforceability of any liens or encumbrances on the property.
2778 (2) (a) The commissioner may assess each title insurer and each title insurance agency
2779 an annual assessment:
2780 (i) determined by the Title and Escrow Commission:
2781 (A) after consultation with the commissioner; and
2782 (B) in accordance with this Subsection (2); and
2783 (ii) to be used for the purposes described in Subsection (3).
2784 (b) A title insurance agency shall be assessed up to:
2785 (i) [$200] $250 for the first office in each county in which the title insurance agency
2786 maintains an office; and
2787 (ii) [$100] $150 for each additional office the title insurance agency maintains in the
2788 county described in Subsection (2)(b)(i).
2789 (c) A title insurer shall be assessed up to:
2790 (i) [$200] $250 for the first office in each county in which the title insurer maintains an
2791 office;
2792 (ii) [$100] $150 for each additional office the title insurer maintains in the county
2793 described in Subsection (2)(c)(i); and
2794 (iii) an amount calculated by:
2795 (A) aggregating the assessments imposed on:
2796 (I) title insurance agencies under Subsection (2)(b); and
2797 (II) title insurers under Subsections (2)(c)(i) and (2)(c)(ii);
2798 (B) subtracting the amount determined under Subsection (2)(c)(iii)(A) from the total
2799 costs and expenses determined under Subsection (2)(d); and
2800 (C) multiplying:
2801 (I) the amount calculated under Subsection (2)(c)(iii)(B); and

2802 (II) the percentage of total premiums for title insurance on Utah risk that are premiums
2803 of the title insurer.
2804 (d) Notwithstanding Section 31A-3-103 and subject to Section 31A-2-404 , the Title
2805 and Escrow Commission by rule shall establish the amount of costs and expenses described
2806 under Subsection (3) that will be covered by the assessment, except the costs or expenses to be
2807 covered by the assessment may not exceed [$75,000] $80,000 annually.
2808 (3) (a) Money received by the state under this section shall be deposited into the Title
2809 Licensee Enforcement Restricted Account.
2810 (b) There is created in the General Fund a restricted account known as the "Title
2811 Licensee Enforcement Restricted Account."
2812 (c) The Title Licensee Enforcement Restricted Account shall consist of the money
2813 received by the state under this section.
2814 (d) The commissioner shall administer the Title Licensee Enforcement Restricted
2815 Account. Subject to appropriations by the Legislature, the commissioner shall use the money
2816 deposited into the Title Licensee Enforcement Restricted Account only to pay for a cost or
2817 expense incurred by the department in the administration, investigation, and enforcement of
2818 this part and Part 5, Compensation of Producers and Consultants, related to:
2819 (i) the marketing of title insurance; and
2820 (ii) audits of agencies.
2821 (e) An appropriation from the Title Licensee Enforcement Restricted Account is
2822 nonlapsing.
2823 (4) The assessment imposed by this section shall be in addition to any premium
2824 assessment imposed under Subsection 59-9-101 (3).
2825 Section 27. Section 31A-23a-501 is amended to read:
2826 31A-23a-501. Licensee compensation.
2827 (1) As used in this section:
2828 (a) "Commission compensation" includes funds paid to or credited for the benefit of a
2829 licensee from:

2830 (i) commission amounts deducted from insurance premiums on insurance sold by or
2831 placed through the licensee; or
2832 (ii) commission amounts received from an insurer or another licensee as a result of the
2833 sale or placement of insurance.
2834 (b) (i) "Compensation from an insurer or third party administrator" means
2835 commissions, fees, awards, overrides, bonuses, contingent commissions, loans, stock options,
2836 gifts, prizes, or any other form of valuable consideration:
2837 (A) whether or not payable pursuant to a written agreement; and
2838 (B) received from:
2839 (I) an insurer; or
2840 (II) a third party to the transaction for the sale or placement of insurance.
2841 (ii) "Compensation from an insurer or third party administrator" does not mean
2842 compensation from a customer that is:
2843 (A) a fee or pass-through costs as provided in Subsection (1)(e); or
2844 (B) a fee or amount collected by or paid to the producer that does not exceed an
2845 amount established by the commissioner by administrative rule.
2846 (c) (i) "Customer" means:
2847 (A) the person signing the application or submission for insurance; or
2848 (B) the authorized representative of the insured actually negotiating the placement of
2849 insurance with the producer.
2850 (ii) "Customer" does not mean a person who is a participant or beneficiary of:
2851 (A) an employee benefit plan; or
2852 (B) a group or blanket insurance policy or group annuity contract sold, solicited, or
2853 negotiated by the producer or affiliate.
2854 (d) (i) "Noncommission compensation" includes all funds paid to or credited for the
2855 benefit of a licensee other than commission compensation.
2856 (ii) "Noncommission compensation" does not include charges for pass-through costs
2857 incurred by the licensee in connection with obtaining, placing, or servicing an insurance policy.

2858 (e) "Pass-through costs" include:
2859 (i) costs for copying documents to be submitted to the insurer; and
2860 (ii) bank costs for processing cash or credit card payments.
2861 (2) A licensee may receive from an insured or from a person purchasing an insurance
2862 policy, noncommission compensation if the noncommission compensation is stated on a
2863 separate, written disclosure.
2864 (a) The disclosure required by this Subsection (2) shall:
2865 (i) include the signature of the insured or prospective insured acknowledging the
2866 noncommission compensation;
2867 (ii) clearly specify the amount or extent of the noncommission compensation; and
2868 (iii) be provided to the insured or prospective insured before the performance of the
2869 service.
2870 (b) Noncommission compensation shall be:
2871 (i) limited to actual or reasonable expenses incurred for services; and
2872 (ii) uniformly applied to all insureds or prospective insureds in a class or classes of
2873 business or for a specific service or services.
2874 (c) A copy of the signed disclosure required by this Subsection (2) must be maintained
2875 by any licensee who collects or receives the noncommission compensation or any portion of
2876 the noncommission compensation.
2877 (d) All accounting records relating to noncommission compensation shall be
2878 maintained by the person described in Subsection (2)(c) in a manner that facilitates an audit.
2879 (3) (a) A licensee may receive noncommission compensation when acting as a
2880 producer for the insured in connection with the actual sale or placement of insurance if:
2881 (i) the producer and the insured have agreed on the producer's noncommission
2882 compensation; and
2883 (ii) the producer has disclosed to the insured the existence and source of any other
2884 compensation that accrues to the producer as a result of the transaction.
2885 (b) The disclosure required by this Subsection (3) shall:

2886 (i) include the signature of the insured or prospective insured acknowledging the
2887 noncommission compensation;
2888 (ii) clearly specify the amount or extent of the noncommission compensation and the
2889 existence and source of any other compensation; and
2890 (iii) be provided to the insured or prospective insured before the performance of the
2891 service.
2892 (c) The following additional noncommission compensation is authorized:
2893 (i) compensation received by a producer of a compensated corporate surety who under
2894 procedures approved by a rule or order of the commissioner is paid by surety bond principal
2895 debtors for extra services;
2896 (ii) compensation received by an insurance producer who is also licensed as a public
2897 adjuster under Section 31A-26-203 , for services performed for an insured in connection with a
2898 claim adjustment, so long as the producer does not receive or is not promised compensation for
2899 aiding in the claim adjustment prior to the occurrence of the claim;
2900 (iii) compensation received by a consultant as a consulting fee, provided the consultant
2901 complies with the requirements of Section 31A-23a-401 ; or
2902 (iv) other compensation arrangements approved by the commissioner after a finding
2903 that they do not violate Section 31A-23a-401 and are not harmful to the public.
2904 (4) (a) For purposes of this Subsection (4), "producer" includes:
2905 (i) a producer;
2906 (ii) an affiliate of a producer; or
2907 (iii) a consultant.
2908 (b) Beginning January 1, 2010, in addition to any other disclosures required by this
2909 section, a producer may not accept or receive any compensation from an insurer or third party
2910 administrator for the placement of a health benefit plan, other than a hospital confinement
2911 indemnity policy, unless prior to the customer's purchase of the health benefit plan the
2912 producer:
2913 (i) except as provided in Subsection (4)(c), discloses in writing to the customer that the

2914 producer will receive compensation from the insurer or third party administrator for the
2915 placement of insurance, including the amount or type of compensation known to the producer
2916 at the time of the disclosure; and
2917 (ii) except as provided in Subsection (4)(c):
2918 (A) obtains the customer's signed acknowledgment that the disclosure under
2919 Subsection (4)(b)(i) was made to the customer; or
2920 (B) (I) signs a statement that the disclosure required by Subsection (4)(b)(i) was made
2921 to the customer; and
2922 (II) keeps the signed statement on file in the producer's office while the health benefit
2923 plan placed with the customer is in force.
2924 (c) If the compensation to the producer from an insurer or third party administrator is
2925 for the renewal of a health benefit plan, once the producer has made an initial disclosure that
2926 complies with Subsection (4)(b), the producer does not have to disclose compensation received
2927 for the subsequent yearly renewals in accordance with Subsection (4)(b) until the renewal
2928 period immediately following 36 months after the initial disclosure.
2929 (d) (i) A licensee who collects or receives any part of the compensation from an insurer
2930 or third party administrator in a manner that facilitates an audit shall, while the health benefit
2931 plan placed with the customer is in force, maintain a copy of:
2932 (A) the signed acknowledgment described in Subsection (4)(b)(i); or
2933 (B) the signed statement described in Subsection (4)(b)(ii).
2934 (ii) The standard application developed in accordance with Section 31A-22-635 shall
2935 include a place for a producer to provide the disclosure required by this Subsection (4), and if
2936 completed, shall satisfy the requirement of Subsection (4)(d)(i).
2937 (e) Subsection (4)(b)(ii) does not apply to:
2938 (i) a person licensed as a producer who acts only as an intermediary between an insurer
2939 and the customer's producer, including a managing general agent; or
2940 (ii) the placement of insurance in a secondary or residual market.
2941 (5) This section does not alter the right of any licensee to recover from an insured the

2942 amount of any premium due for insurance effected by or through that licensee or to charge a
2943 reasonable rate of interest upon past-due accounts.
2944 (6) This section does not apply to bail bond producers or bail enforcement agents as
2945 defined in Section 31A-35-102 .
2946 (7) A licensee may not receive noncommission compensation from an insured or
2947 enrollee for providing a service or engaging in an act that is required to be provided or
2948 performed in order to receive commission compensation, except for the surplus lines
2949 transactions that do not receive commissions.
2950 Section 28. Section 31A-25-208 is amended to read:
2951 31A-25-208. Revocation, suspension, surrender, lapsing, limiting, or otherwise
2952 terminating a license -- Rulemaking for renewal and reinstatement.
2953 (1) A license type issued under this chapter remains in force until:
2954 (a) revoked or suspended under Subsection (4);
2955 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
2956 administrative action;
2957 (c) the licensee dies or is adjudicated incompetent as defined under:
2958 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2959 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2960 Minors;
2961 (d) lapsed under Section 31A-25-210 ; or
2962 (e) voluntarily surrendered.
2963 (2) The following may be reinstated within one year after the day on which the license
2964 is no longer in force:
2965 (a) a lapsed license; or
2966 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
2967 not be reinstated after the license period in which the license is voluntarily surrendered.
2968 (3) Unless otherwise stated in [the] a written agreement for the voluntary surrender of a
2969 license, submission and acceptance of a voluntary surrender of a license does not prevent the

2970 department from pursuing additional disciplinary or other action authorized under:
2971 (a) this title; or
2972 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
2973 Administrative Rulemaking Act.
2974 (4) (a) If the commissioner makes a finding under Subsection (4)(b), as part of an
2975 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
2976 commissioner may:
2977 (i) revoke a license;
2978 (ii) suspend a license for a specified period of 12 months or less;
2979 (iii) limit a license in whole or in part; or
2980 (iv) deny a license application.
2981 (b) The commissioner may take an action described in Subsection (4)(a) if the
2982 commissioner finds that the licensee:
2983 (i) is unqualified for a license under Section 31A-25-202 , 31A-25-203 , or 31A-25-204 ;
2984 (ii) has violated:
2985 (A) an insurance statute;
2986 (B) a rule that is valid under Subsection 31A-2-201 (3); or
2987 (C) an order that is valid under Subsection 31A-2-201 (4);
2988 (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
2989 delinquency proceedings in any state;
2990 (iv) fails to pay a final judgment rendered against the person in this state within 60
2991 days after the day on which the judgment became final;
2992 (v) fails to meet the same good faith obligations in claims settlement that is required of
2993 admitted insurers;
2994 (vi) is affiliated with and under the same general management or interlocking
2995 directorate or ownership as another third party administrator that transacts business in this state
2996 without a license;
2997 (vii) refuses:

2998 (A) to be examined; or
2999 (B) to produce its accounts, records, and files for examination;
3000 (viii) has an officer who refuses to:
3001 (A) give information with respect to the third party administrator's affairs; or
3002 (B) perform any other legal obligation as to an examination;
3003 (ix) provides information in the license application that is:
3004 (A) incorrect;
3005 (B) misleading;
3006 (C) incomplete; or
3007 (D) materially untrue;
3008 (x) has violated an insurance law, valid rule, or valid order of another state's insurance
3009 department;
3010 (xi) has obtained or attempted to obtain a license through misrepresentation or fraud;
3011 (xii) has improperly withheld, misappropriated, or converted money or properties
3012 received in the course of doing insurance business;
3013 (xiii) has intentionally misrepresented the terms of an actual or proposed:
3014 (A) insurance contract; or
3015 (B) application for insurance;
3016 (xiv) has been convicted of a felony;
3017 (xv) has admitted or been found to have committed an insurance unfair trade practice
3018 or fraud;
3019 (xvi) in the conduct of business in this state or elsewhere has:
3020 (A) used fraudulent, coercive, or dishonest practices; or
3021 (B) demonstrated incompetence, untrustworthiness, or financial irresponsibility;
3022 (xvii) has had an insurance license or its equivalent, denied, suspended, or revoked in
3023 any other state, province, district, or territory;
3024 (xviii) has forged another's name to:
3025 (A) an application for insurance; or

3026 (B) a document related to an insurance transaction;
3027 (xix) has improperly used notes or any other reference material to complete an
3028 examination for an insurance license;
3029 (xx) has knowingly accepted insurance business from an individual who is not
3030 licensed;
3031 (xxi) has failed to comply with an administrative or court order imposing a child
3032 support obligation;
3033 (xxii) has failed to:
3034 (A) pay state income tax; or
3035 (B) comply with an administrative or court order directing payment of state income
3036 tax;
3037 (xxiii) has violated or permitted others to violate the federal Violent Crime Control and
3038 Law Enforcement Act of 1994, 18 U.S.C. [Secs.] Sec. 1033 and 1034; or
3039 (xxiv) has engaged in methods and practices in the conduct of business that endanger
3040 the legitimate interests of customers and the public.
3041 (c) For purposes of this section, if a license is held by an agency, both the agency itself
3042 and any individual designated under the license are considered to be the holders of the agency
3043 license.
3044 (d) If an individual designated under the agency license commits an act or fails to
3045 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
3046 the commissioner may suspend, revoke, or limit the license of:
3047 (i) the individual;
3048 (ii) the agency if the agency:
3049 (A) is reckless or negligent in its supervision of the individual; or
3050 (B) knowingly participated in the act or failure to act that is the ground for suspending,
3051 revoking, or limiting the license; or
3052 (iii) (A) the individual; and
3053 (B) the agency if the agency meets the requirements of Subsection (4)(d)(ii).

3054 (5) A licensee under this chapter is subject to the penalties for acting as a licensee
3055 without a license if:
3056 (a) the licensee's license is:
3057 (i) revoked;
3058 (ii) suspended;
3059 (iii) limited;
3060 (iv) surrendered in lieu of administrative action;
3061 (v) lapsed; or
3062 (vi) voluntarily surrendered; and
3063 (b) the licensee:
3064 (i) continues to act as a licensee; or
3065 (ii) violates the terms of the license limitation.
3066 (6) A licensee under this chapter shall immediately report to the commissioner:
3067 (a) a revocation, suspension, or limitation of the person's license in any other state, the
3068 District of Columbia, or a territory of the United States;
3069 (b) the imposition of a disciplinary sanction imposed on that person by any other state,
3070 the District of Columbia, or a territory of the United States; or
3071 (c) a judgment or injunction entered against the person on the basis of conduct
3072 involving:
3073 (i) fraud;
3074 (ii) deceit;
3075 (iii) misrepresentation; or
3076 (iv) a violation of an insurance law or rule.
3077 (7) (a) An order revoking a license under Subsection (4) or an agreement to surrender a
3078 license in lieu of administrative action may specify a time, not to exceed five years, within
3079 which the former licensee may not apply for a new license.
3080 (b) If no time is specified in the order or agreement described in Subsection (7)(a), the
3081 former licensee may not apply for a new license for five years from the day on which the order

3082 or agreement is made without the express approval of the commissioner.
3083 (8) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
3084 a license issued under this part if so ordered by the court.
3085 (9) The commissioner shall by rule prescribe the license renewal and reinstatement
3086 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
3087 Section 29. Section 31A-26-206 is amended to read:
3088 31A-26-206. Continuing education requirements.
3089 (1) Pursuant to this section, the commissioner shall by rule prescribe continuing
3090 education requirements for each class of license under Section 31A-26-204 .
3091 (2) (a) The commissioner shall impose continuing education requirements in
3092 accordance with a two-year licensing period in which the licensee meets the requirements of
3093 this Subsection (2).
3094 (b) (i) Except as otherwise provided in [Subsection (2)(b)(iii)] this section, the
3095 continuing education requirements shall require:
3096 (A) that a licensee complete 24 credit hours of continuing education for every two-year
3097 licensing period;
3098 (B) that [three] 3 of the 24 credit hours described in Subsection (2)(b)(i)(A) be ethics
3099 courses; and
3100 (C) that the licensee complete at least half of the required hours through classroom
3101 hours of insurance-related instruction.
3102 [(ii) The hours not completed through classroom hours]
3103 (ii) A continuing education hour completed in accordance with Subsection
3104 (2)(b)(i)[(C)] may be obtained through:
3105 (A) classroom attendance;
3106 [(A)] (B) home study;
3107 [(B)] (C) watching a video recording;
3108 [(C)] (D) experience credit; or
3109 [(D)] (E) other methods provided by rule.

3110 (iii) Notwithstanding Subsections (2)(b)(i)(A) and (B), a title insurance adjuster is
3111 required to complete 12 credit hours of continuing education for every two-year licensing
3112 period, with [three] 3 of the credit hours being ethics courses.
3113 (c) A licensee may obtain continuing education hours at any time during the two-year
3114 licensing period.
3115 (d) (i) [Beginning May 3, 1999, a] A licensee is exempt from the continuing education
3116 requirements of this section if:
3117 (A) the licensee was first licensed before April 1, [1970] 1978;
3118 (B) the license does not have a continuous lapse for a period of more than one year,
3119 except for a license for which the licensee has had an exemption approved before May 11,
3120 2011;
3121 [(B)] (C) the licensee requests an exemption from the department; and
3122 [(C)] (D) the department approves the exemption.
3123 (ii) If the department approves the exemption under Subsection (2)(d)(i), the licensee is
3124 not required to apply again for the exemption.
3125 (e) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3126 commissioner shall by rule:
3127 (i) publish a list of insurance professional designations whose continuing education
3128 requirements can be used to meet the requirements for continuing education under Subsection
3129 (2)(b); and
3130 (ii) authorize a professional adjuster [associations] association to:
3131 (A) offer a qualified [programs for all classes of licenses] program for a classification
3132 of license on a geographically accessible basis; and
3133 (B) collect a reasonable [fees] fee for funding and administration of [the continuing
3134 education programs] a qualified program, subject to the review and approval of the
3135 commissioner.
3136 (f) (i) [The fees] A fee permitted under Subsection (2)(e)(ii)(B) that [are] is charged to
3137 fund and administer a qualified program shall reasonably relate to the [costs] cost of

3138 administering the qualified program.
3139 (ii) Nothing in this section shall prohibit a provider of a continuing education
3140 [programs or courses] program or course from charging [fees] a fee for attendance at [courses]
3141 a course offered for continuing education credit.
3142 (iii) [The fees] A fee permitted under Subsection (2)(e)(ii)(B) that [are] is charged for
3143 attendance at an association program may be less for an association member, [based] on the
3144 basis of the member's affiliation expense, but shall preserve the right of a nonmember to attend
3145 without affiliation.
3146 (3) The continuing education requirements of this section apply only to [licensees who
3147 are natural persons] a licensee who is an individual.
3148 (4) The continuing education requirements of this section do not apply to [members] a
3149 member of the Utah State Bar.
3150 (5) The commissioner shall designate [courses that satisfy] a course that satisfies the
3151 requirements of this section, including [those] a course presented by [insurers] an insurer.
3152 (6) A nonresident adjuster is considered to have satisfied this state's continuing
3153 education requirements if:
3154 (a) the nonresident adjuster satisfies the nonresident producer's home state's continuing
3155 education requirements for a licensed insurance adjuster; and
3156 (b) on the same basis the nonresident adjuster's home state considers satisfaction of
3157 Utah's continuing education requirements for a producer as satisfying the continuing education
3158 requirements of the home state.
3159 (7) A licensee subject to this section shall keep documentation of completing the
3160 continuing education requirements of this section for two years after the end of the two-year
3161 licensing period to which the continuing education requirement applies.
3162 Section 30. Section 31A-26-208 is amended to read:
3163 31A-26-208. Nonresident jurisdictional agreement.
3164 (1) (a) If a nonresident license applicant has a valid license from the nonresident
3165 license applicant's home state and the conditions of Subsection (1)(b) are met, the

3166 commissioner shall:
3167 (i) waive any license requirement for a license under this chapter; and
3168 (ii) issue the nonresident license applicant a nonresident adjuster's license.
3169 (b) Subsection (1)(a) applies if:
3170 (i) the nonresident license applicant:
3171 (A) is licensed as a resident in the nonresident license applicant's home state at the time
3172 the nonresident license applicant applies for a nonresident adjuster license;
3173 (B) has submitted the proper request for licensure;
3174 (C) has submitted to the commissioner:
3175 (I) the application for licensure that the nonresident license applicant submitted to the
3176 applicant's home state; or
3177 (II) a completed uniform application; and
3178 (D) has paid the applicable fees under Section 31A-3-103 ;
3179 (ii) the nonresident license applicant's license in the applicant's home state is in good
3180 standing; and
3181 (iii) the nonresident license applicant's home state awards nonresident adjuster licenses
3182 to residents of this state on the same basis as this state awards licenses to residents of that home
3183 state.
3184 (2) A nonresident applicant shall execute in a form acceptable to the commissioner an
3185 agreement to be subject to the jurisdiction of the commissioner and courts of this state on any
3186 matter related to the adjuster's insurance activities in this state, on the basis of:
3187 (a) service of process under Sections 31A-2-309 and 31A-2-310 ; or
3188 (b) other service authorized under the Utah Rules of Civil Procedure or Section
3189 78B-3-206 .
3190 (3) The commissioner may verify [the third party administrator's] an adjuster's
3191 licensing status through the database maintained by:
3192 (a) the National Association of Insurance Commissioners; or
3193 (b) an affiliate or subsidiary of the National Association of Insurance Commissioners.

3194 (4) The commissioner may not assess a greater fee for an insurance license or related
3195 service to a person not residing in this state based solely on the fact that the person does not
3196 reside in this state.
3197 Section 31. Section 31A-26-213 is amended to read:
3198 31A-26-213. Revocation, suspension, surrender, lapsing, limiting, or otherwise
3199 terminating a license -- Rulemaking for renewal or reinstatement.
3200 (1) A license type issued under this chapter remains in force until:
3201 (a) revoked or suspended under Subsection (5);
3202 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
3203 administrative action;
3204 (c) the licensee dies or is adjudicated incompetent as defined under:
3205 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
3206 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
3207 Minors;
3208 (d) lapsed under Section 31A-26-214.5 ; or
3209 (e) voluntarily surrendered.
3210 (2) The following may be reinstated within one year after the day on which the license
3211 is no longer in force:
3212 (a) a lapsed license; or
3213 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
3214 not be reinstated after the license period in which it is voluntarily surrendered.
3215 (3) Unless otherwise stated in [the] a written agreement for the voluntary surrender of a
3216 license, submission and acceptance of a voluntary surrender of a license does not prevent the
3217 department from pursuing additional disciplinary or other action authorized under:
3218 (a) this title; or
3219 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
3220 Administrative Rulemaking Act.
3221 (4) A license classification issued under this chapter remains in force until:

3222 (a) the qualifications pertaining to a license classification are no longer met by the
3223 licensee; or
3224 (b) the supporting license type:
3225 (i) is revoked or suspended under Subsection (5); or
3226 (ii) is surrendered to the commissioner and accepted by the commissioner in lieu of
3227 administrative action.
3228 (5) (a) If the commissioner makes a finding under Subsection (5)(b) as part of an
3229 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
3230 commissioner may:
3231 (i) revoke:
3232 (A) a license; or
3233 (B) a license classification;
3234 (ii) suspend for a specified period of 12 months or less:
3235 (A) a license; or
3236 (B) a license classification;
3237 (iii) limit in whole or in part:
3238 (A) a license; or
3239 (B) a license classification; or
3240 (iv) deny a license application.
3241 (b) The commissioner may take an action described in Subsection (5)(a) if the
3242 commissioner finds that the licensee:
3243 (i) is unqualified for a license or license classification under Section 31A-26-202 ,
3244 31A-26-203 , 31A-26-204 , or 31A-26-205 ;
3245 (ii) has violated:
3246 (A) an insurance statute;
3247 (B) a rule that is valid under Subsection 31A-2-201 (3); or
3248 (C) an order that is valid under Subsection 31A-2-201 (4);
3249 (iii) is insolvent, or the subject of receivership, conservatorship, rehabilitation, or other

3250 delinquency proceedings in any state;
3251 (iv) fails to pay a final judgment rendered against the person in this state within 60
3252 days after the judgment became final;
3253 (v) fails to meet the same good faith obligations in claims settlement that is required of
3254 admitted insurers;
3255 (vi) is affiliated with and under the same general management or interlocking
3256 directorate or ownership as another insurance adjuster that transacts business in this state
3257 without a license;
3258 (vii) refuses:
3259 (A) to be examined; or
3260 (B) to produce its accounts, records, and files for examination;
3261 (viii) has an officer who refuses to:
3262 (A) give information with respect to the insurance adjuster's affairs; or
3263 (B) perform any other legal obligation as to an examination;
3264 (ix) provides information in the license application that is:
3265 (A) incorrect;
3266 (B) misleading;
3267 (C) incomplete; or
3268 (D) materially untrue;
3269 (x) has violated an insurance law, valid rule, or valid order of another state's insurance
3270 department;
3271 (xi) has obtained or attempted to obtain a license through misrepresentation or fraud;
3272 (xii) has improperly withheld, misappropriated, or converted money or properties
3273 received in the course of doing insurance business;
3274 (xiii) has intentionally misrepresented the terms of an actual or proposed:
3275 (A) insurance contract; or
3276 (B) application for insurance;
3277 (xiv) has been convicted of a felony;

3278 (xv) has admitted or been found to have committed an insurance unfair trade practice
3279 or fraud;
3280 (xvi) in the conduct of business in this state or elsewhere has:
3281 (A) used fraudulent, coercive, or dishonest practices; or
3282 (B) demonstrated incompetence, untrustworthiness, or financial irresponsibility;
3283 (xvii) has had an insurance license, or its equivalent, denied, suspended, or revoked in
3284 any other state, province, district, or territory;
3285 (xviii) has forged another's name to:
3286 (A) an application for insurance; or
3287 (B) a document related to an insurance transaction;
3288 (xix) has improperly used notes or any other reference material to complete an
3289 examination for an insurance license;
3290 (xx) has knowingly accepted insurance business from an individual who is not
3291 licensed;
3292 (xxi) has failed to comply with an administrative or court order imposing a child
3293 support obligation;
3294 (xxii) has failed to:
3295 (A) pay state income tax; or
3296 (B) comply with an administrative or court order directing payment of state income
3297 tax;
3298 (xxiii) has violated or permitted others to violate the federal Violent Crime Control and
3299 Law Enforcement Act of 1994, 18 U.S.C. [Secs.] Sec. 1033 and 1034; or
3300 (xxiv) has engaged in methods and practices in the conduct of business that endanger
3301 the legitimate interests of customers and the public.
3302 (c) For purposes of this section, if a license is held by an agency, both the agency itself
3303 and any individual designated under the license are considered to be the holders of the license.
3304 (d) If an individual designated under the agency license commits an act or fails to
3305 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,

3306 the commissioner may suspend, revoke, or limit the license of:
3307 (i) the individual;
3308 (ii) the agency, if the agency:
3309 (A) is reckless or negligent in its supervision of the individual; or
3310 (B) knowingly participated in the act or failure to act that is the ground for suspending,
3311 revoking, or limiting the license; or
3312 (iii) (A) the individual; and
3313 (B) the agency if the agency meets the requirements of Subsection (5)(d)(ii).
3314 (6) A licensee under this chapter is subject to the penalties for conducting an insurance
3315 business without a license if:
3316 (a) the licensee's license is:
3317 (i) revoked;
3318 (ii) suspended;
3319 (iii) limited;
3320 (iv) surrendered in lieu of administrative action;
3321 (v) lapsed; or
3322 (vi) voluntarily surrendered; and
3323 (b) the licensee:
3324 (i) continues to act as a licensee; or
3325 (ii) violates the terms of the license limitation.
3326 (7) A licensee under this chapter shall immediately report to the commissioner:
3327 (a) a revocation, suspension, or limitation of the person's license in any other state, the
3328 District of Columbia, or a territory of the United States;
3329 (b) the imposition of a disciplinary sanction imposed on that person by any other state,
3330 the District of Columbia, or a territory of the United States; or
3331 (c) a judgment or injunction entered against that person on the basis of conduct
3332 involving:
3333 (i) fraud;

3334 (ii) deceit;
3335 (iii) misrepresentation; or
3336 (iv) a violation of an insurance law or rule.
3337 (8) (a) An order revoking a license under Subsection (5) or an agreement to surrender a
3338 license in lieu of administrative action may specify a time not to exceed five years within
3339 which the former licensee may not apply for a new license.
3340 (b) If no time is specified in the order or agreement described in Subsection (8)(a), the
3341 former licensee may not apply for a new license for five years without the express approval of
3342 the commissioner.
3343 (9) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
3344 a license issued under this part if so ordered by a court.
3345 (10) The commissioner shall by rule prescribe the license renewal and reinstatement
3346 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
3347 Section 32. Section 31A-26-306 is amended to read:
3348 31A-26-306. Place of business -- Records.
3349 (1) (a) An insurance adjuster licensed under this chapter shall[: (i)] register and
3350 maintain with the commissioner:
3351 (i) the address and telephone number of the licensee's principal place of business; [and]
3352 (ii) a valid business email address at which the commissioner may contact the licensee;
3353 and
3354 [(ii)] (iii) if the licensee is an individual, [provide] the licensee's residence address and
3355 telephone number.
3356 (b) A licensee shall notify the commissioner within 30 days of [any change of] a
3357 change in one of the following required to be registered under Subsection (1)(a):
3358 (i) an address [or];
3359 (ii) a telephone number[.]; or
3360 (iii) a business email address.
3361 (2) Except as provided under Subsection (3), [every] an insurance adjuster shall keep at

3362 the address registered under Subsection (1), a record of [all] the transactions consummated
3363 under the insurance adjuster's license, including a record of:
3364 (a) each investigation or adjustment undertaken or consummated; and
3365 (b) [any] a fee, commission, or other compensation received or to be received by the
3366 adjuster on account of the investigation or adjustment.
3367 (3) Subsection (2) is satisfied if the records specified in [that subsection] Subsection
3368 (2) can be obtained immediately from a central storage place elsewhere by on-line computer
3369 terminals located at the registered address.
3370 (4) (a) [The records] A record maintained as to a transaction under Subsection (2) shall
3371 be kept available for the inspection of the commissioner during all business hours for a period
3372 of time after the date of the transaction specified by the commissioner by rule, but in no case
3373 for less than the current calendar year plus three years.
3374 (b) Discarding [records] a record after the then applicable record retention period is
3375 passed does not place the licensee in violation of a later-adopted longer record retention period.
3376 Section 33. Section 31A-28-107 is amended to read:
3377 31A-28-107. Board of directors.
3378 (1) (a) The board of directors of the association shall consist of:
3379 (i) at least five but not more than nine member insurers who:
3380 (A) subject to Subsection (1)(e), serve terms as established in the plan of operation;
3381 and
3382 (B) are selected by member insurers, subject to the approval of the commissioner; and
3383 (ii) two public representatives appointed by the commissioner.
3384 (b) (i) The commissioner shall make the appointment of a public representative
3385 coincide with the association's annual meeting at which the association's board of directors is
3386 elected.
3387 (ii) A public representative may not be:
3388 (A) an officer, director, or employee of an insurer; or
3389 (B) a person engaged in the business of insurance.

3390 (iii) Subject to Subsection (1)(e), a public representative shall serve a term of three
3391 years.
3392 (c) When a vacancy occurs in the membership of the board of directors for any reason:
3393 (i) if the vacancy is of a member insurer, a replacement may be elected for the
3394 unexpired term by a majority vote of the remaining board members, subject to the approval of
3395 the commissioner; and
3396 (ii) if the vacancy is of a public representative, the commissioner shall appoint a
3397 replacement for the unexpired term.
3398 (d) In approving a selection or in appointing a member to the board of directors, the
3399 commissioner shall consider, among other things, whether all member insurers are fairly
3400 represented.
3401 (e) Notwithstanding Subsections (1)(a) and (b), the commissioner shall, at the time of
3402 election, reelection, appointment, or reappointment adjust the length of terms to ensure that the
3403 terms of board members are staggered so that approximately half of the board of directors is
3404 selected during any two-year period.
3405 (2) (a) A member of the board of directors may be reimbursed from the assets of the
3406 association for expenses incurred by the member as a member of the board of directors.
3407 (b) A public representative appointed under Subsection (1)(a)(ii) may not receive
3408 compensation or benefits for the public representative's service, but in addition to
3409 reimbursement under Subsection (2)(a), a public representative may receive per diem and
3410 travel expenses established by the board with the approval of the commissioner.
3411 [(b)] (c) Except as provided in [Subsection (2)(a)] Subsections (2)(a) and (b), a
3412 member of the board of directors may not be compensated by the association for the member's
3413 services.
3414 Section 34. Section 31A-29-103 is amended to read:
3415 31A-29-103. Definitions.
3416 As used in this chapter:
3417 (1) "Board" means the board of directors of the pool created in Section 31A-29-104 .

3418 (2) (a) "Creditable coverage" has the same meaning as provided in Section 31A-1-301 .
3419 (b) "Creditable coverage" does not include a period of time in which there is a
3420 significant break in coverage, as defined in Section 31A-1-301 .
3421 (3) "Domicile" means the place where an individual has a fixed and permanent home
3422 and principal establishment:
3423 (a) to which the individual, if absent, intends to return; and
3424 (b) in which the individual, and the individual's family voluntarily reside, not for a
3425 special or temporary purpose, but with the intention of making a permanent home.
3426 (4) "Enrollee" means an individual who has met the eligibility requirements of the pool
3427 and is covered by a pool policy under this chapter.
3428 (5) "Health benefit plan":
3429 (a) is defined in Section 31A-1-301 ; and
3430 (b) does not include a plan that:
3431 (i) (A) has a maximum actuarial value less that 100% of the basic health care plan; or
3432 (B) has a maximum annual limit of $100,000 or less; and
3433 (ii) meets other criteria established by the board.
3434 (6) "Health care facility" means any entity providing health care services which is
3435 licensed under Title 26, Chapter 21, Health Care Facility Licensing and Inspection Act.
3436 (7) "Health care insurance" is defined in Section 31A-1-301 .
3437 (8) "Health care provider" has the same meaning as provided in Section 78B-3-403 .
3438 (9) "Health care services" means:
3439 (a) any service or product:
3440 (i) used in furnishing to any individual medical care or hospitalization; or
3441 (ii) incidental to furnishing medical care or hospitalization; and
3442 (b) any other service or product furnished for the purpose of preventing, alleviating,
3443 curing, or healing human illness or injury.
3444 (10) "Health maintenance organization" has the same meaning as provided in Section
3445 31A-8-101 .

3446 (11) "Health plan" means any arrangement by which an individual, including a
3447 dependent or spouse, covered or making application to be covered under the pool has:
3448 (a) access to hospital and medical benefits or reimbursement including group or
3449 individual insurance or subscriber contract;
3450 (b) coverage through:
3451 (i) a health maintenance organization;
3452 (ii) a preferred provider prepayment;
3453 (iii) group practice;
3454 (iv) individual practice plan; or
3455 (v) health care insurance;
3456 (c) coverage under an uninsured arrangement of group or group-type contracts
3457 including employer self-insured, cost-plus, or other benefits methodologies not involving
3458 insurance;
3459 (d) coverage under a group type contract which is not available to the general public
3460 and can be obtained only because of connection with a particular organization or group; and
3461 (e) coverage by Medicare or other governmental benefit.
3462 (12) "HIPAA" means the Health Insurance Portability and Accountability Act [of 1996,
3463 Pub. L. 104-191, 110 Stat. 1936].
3464 (13) "HIPAA eligible" means an individual who is eligible under the provisions of the
3465 Health Insurance Portability and Accountability Act [of 1996, Pub. L. 104-191, 110 Stat.
3466 1936].
3467 (14) "Insurer" means:
3468 (a) an insurance company authorized to transact accident and health insurance business
3469 in this state;
3470 (b) a health maintenance organization; or
3471 (c) a self-insurer not subject to federal preemption.
3472 (15) "Medicaid" means coverage under Title XIX of the Social Security Act, 42 U.S.C.
3473 Sec. 1396 et seq., as amended.

3474 (16) "Medicare" means coverage under both Part A and B of Title XVIII of the Social
3475 Security Act, 42 U.S.C. Sec. 1395 et seq., as amended.
3476 (17) "Plan of operation" means the plan developed by the board in accordance with
3477 Section 31A-29-105 and includes the articles, bylaws, and operating rules adopted by the board
3478 under Section 31A-29-106 .
3479 (18) "Pool" means the Utah Comprehensive Health Insurance Pool created in Section
3480 31A-29-104 .
3481 (19) "Pool fund" means the Comprehensive Health Insurance Pool Enterprise Fund
3482 created in Section 31A-29-120 .
3483 (20) "Pool policy" means a health benefit plan policy issued under this chapter.
3484 (21) "Preexisting condition" has the same meaning as defined in Section 31A-1-301 .
3485 (22) (a) "Resident" or "residency" means a person who is domiciled in this state.
3486 (b) A resident retains residency if that resident leaves this state:
3487 (i) to serve in the armed forces of the United States; or
3488 (ii) for religious or educational purposes.
3489 (23) "Third-party administrator" has the same meaning as provided in Section
3490 31A-1-301 .
3491 Section 35. Section 31A-29-106 is amended to read:
3492 31A-29-106. Powers of board.
3493 (1) The board shall have the general powers and authority granted under the laws of
3494 this state to insurance companies licensed to transact health care insurance business. In
3495 addition, the board shall have the specific authority to:
3496 (a) enter into contracts to carry out the provisions and purposes of this chapter,
3497 including, with the approval of the commissioner, contracts with:
3498 (i) similar pools of other states for the joint performance of common administrative
3499 functions; or
3500 (ii) persons or other organizations for the performance of administrative functions;
3501 (b) sue or be sued, including taking such legal action necessary to avoid the payment of

3502 improper claims against the pool or the coverage provided through the pool;
3503 (c) establish appropriate rates, rate schedules, rate adjustments, expense allowances,
3504 agents' referral fees, claim reserve formulas, and any other actuarial function appropriate to the
3505 operation of the pool;
3506 (d) issue policies of insurance in accordance with the requirements of this chapter;
3507 (e) retain an executive director and appropriate legal, actuarial, and other personnel as
3508 necessary to provide technical assistance in the operations of the pool;
3509 (f) establish rules, conditions, and procedures for reinsuring risks under this chapter;
3510 (g) cause the pool to have an annual audit of its operations by the state auditor;
3511 (h) coordinate with the Department of Health in seeking to obtain from the Centers for
3512 Medicare and Medicaid Services, or other appropriate office or agency of government, all
3513 appropriate waivers, authority, and permission needed to coordinate the coverage available
3514 from the pool with coverage available under Medicaid, either before or after Medicaid
3515 coverage, or as a conversion option upon completion of Medicaid eligibility, without the
3516 necessity for requalification by the enrollee;
3517 (i) provide for and employ cost containment measures and requirements including
3518 preadmission certification, concurrent inpatient review, and individual case management for
3519 the purpose of making the pool more cost-effective;
3520 (j) offer pool coverage through contracts with health maintenance organizations,
3521 preferred provider organizations, and other managed care systems that will manage costs while
3522 maintaining quality care;
3523 (k) establish annual limits on benefits payable under the pool to or on behalf of any
3524 enrollee;
3525 (l) exclude from coverage under the pool specific benefits, medical conditions, and
3526 procedures for the purpose of protecting the financial viability of the pool;
3527 (m) administer the Pool Fund;
3528 (n) make rules in accordance with Title 63G, Chapter 3, Utah Administrative
3529 Rulemaking Act, to implement this chapter; and

3530 (o) adopt, trademark, and copyright a trade name for the pool for use in marketing and
3531 publicizing the pool and its products.
3532 (2) (a) The board shall prepare and submit an annual report to the Legislature which
3533 shall include:
3534 (i) the net premiums anticipated;
3535 (ii) actuarial projections of payments required of the pool;
3536 (iii) the expenses of administration; and
3537 (iv) the anticipated reserves or losses of the pool.
3538 (b) The budget for operation of the pool is subject to the approval of the board.
3539 (c) The administrative budget of the board and the commissioner under this chapter
3540 shall comply with the requirements of Title 63J, Chapter 1, Budgetary Procedures Act, and is
3541 subject to review and approval by the Legislature.
3542 (3) (a) The board shall on or before September 1, 2004, require the plan administrator
3543 or an independent actuarial consultant retained by the plan administrator to redetermine the
3544 reasonable equivalent of the criteria for uninsurability required under Subsection
3545 31A-30-106 (1)[(j)](h) that is used by the board to determine eligibility for coverage in the pool.
3546 (b) The board shall redetermine the criteria established in Subsection (3)(a) at least
3547 every five years thereafter.
3548 Section 36. Section 31A-30-103 is amended to read:
3549 31A-30-103. Definitions.
3550 As used in this chapter:
3551 (1) "Actuarial certification" means a written statement by a member of the American
3552 Academy of Actuaries or other individual approved by the commissioner that a covered carrier
3553 is in compliance with [Section] Sections 31A-30-106 and 31A-30-106.1 , based upon the
3554 examination of the covered carrier, including review of the appropriate records and of the
3555 actuarial assumptions and methods used by the covered carrier in establishing premium rates
3556 for applicable health benefit plans.
3557 (2) "Affiliate" or "affiliated" means any entity or person who directly or indirectly

3558 through one or more intermediaries, controls or is controlled by, or is under common control
3559 with, a specified entity or person.
3560 (3) "Base premium rate" means, for each class of business as to a rating period, the
3561 lowest premium rate charged or that could have been charged under a rating system for that
3562 class of business by the covered carrier to covered insureds with similar case characteristics for
3563 health benefit plans with the same or similar coverage.
3564 (4) "Basic benefit plan" or "basic coverage" means the coverage provided in the Basic
3565 Health Care Plan under Section 31A-22-613.5 .
3566 (5) "Carrier" means any person or entity that provides health insurance in this state
3567 including:
3568 (a) an insurance company;
3569 (b) a prepaid hospital or medical care plan;
3570 (c) a health maintenance organization;
3571 (d) a multiple employer welfare arrangement; and
3572 (e) any other person or entity providing a health insurance plan under this title.
3573 (6) (a) Except as provided in Subsection (6)(b), "case characteristics" means
3574 demographic or other objective characteristics of a covered insured that are considered by the
3575 carrier in determining premium rates for the covered insured.
3576 (b) "Case characteristics" do not include:
3577 (i) duration of coverage since the policy was issued;
3578 (ii) claim experience; and
3579 (iii) health status.
3580 (7) "Class of business" means all or a separate grouping of covered insureds that is
3581 permitted by the [department] commissioner in accordance with Section 31A-30-105 .
3582 (8) "Conversion policy" means a policy providing coverage under the conversion
3583 provisions required in Chapter 22, Part 7, Group Accident and Health Insurance.
3584 (9) "Covered carrier" means any individual carrier or small employer carrier subject to
3585 this chapter.

3586 (10) "Covered individual" means any individual who is covered under a health benefit
3587 plan subject to this chapter.
3588 (11) "Covered insureds" means small employers and individuals who are issued a
3589 health benefit plan that is subject to this chapter.
3590 (12) "Dependent" means an individual to the extent that the individual is defined to be
3591 a dependent by:
3592 (a) the health benefit plan covering the covered individual; and
3593 (b) Chapter 22, Part 6, Accident and Health Insurance.
3594 (13) "Established geographic service area" means a geographical area approved by the
3595 commissioner within which the carrier is authorized to provide coverage.
3596 (14) "Index rate" means, for each class of business as to a rating period for covered
3597 insureds with similar case characteristics, the arithmetic average of the applicable base
3598 premium rate and the corresponding highest premium rate.
3599 (15) "Individual carrier" means a carrier that provides coverage on an individual basis
3600 through a health benefit plan regardless of whether:
3601 (a) coverage is offered through:
3602 (i) an association;
3603 (ii) a trust;
3604 (iii) a discretionary group; or
3605 (iv) other similar groups; or
3606 (b) the policy or contract is situated out-of-state.
3607 (16) "Individual conversion policy" means a conversion policy issued to:
3608 (a) an individual; or
3609 (b) an individual with a family.
3610 (17) "Individual coverage count" means the number of natural persons covered under a
3611 carrier's health benefit products that are individual policies.
3612 (18) "Individual enrollment cap" means the percentage set by the commissioner in
3613 accordance with Section 31A-30-110 .

3614 (19) "New business premium rate" means, for each class of business as to a rating
3615 period, the lowest premium rate charged or offered, or that could have been charged or offered,
3616 by the carrier to covered insureds with similar case characteristics for newly issued health
3617 benefit plans with the same or similar coverage.
3618 (20) "Premium" means [all] money paid by covered insureds and covered individuals
3619 as a condition of receiving coverage from a covered carrier, including any fees or other
3620 contributions associated with the health benefit plan.
3621 (21) (a) "Rating period" means the calendar period for which premium rates
3622 established by a covered carrier are assumed to be in effect, as determined by the carrier.
3623 (b) A covered carrier may not have:
3624 (i) more than one rating period in any calendar month; and
3625 (ii) no more than 12 rating periods in any calendar year.
3626 (22) "Resident" means an individual who has resided in this state for at least 12
3627 consecutive months immediately preceding the date of application.
3628 (23) "Short-term limited duration insurance" means a health benefit product that:
3629 (a) is not renewable; and
3630 (b) has an expiration date specified in the contract that is less than 364 days after the
3631 date the plan became effective.
3632 (24) "Small employer carrier" means a carrier that provides health benefit plans
3633 covering eligible employees of one or more small employers in this state, regardless of
3634 whether:
3635 (a) coverage is offered through:
3636 (i) an association;
3637 (ii) a trust;
3638 (iii) a discretionary group; or
3639 (iv) other similar grouping; or
3640 (b) the policy or contract is situated out-of-state.
3641 (25) "Uninsurable" means an individual who:

3642 (a) is eligible for the Comprehensive Health Insurance Pool coverage under the
3643 underwriting criteria established in Subsection 31A-29-111 (5); or
3644 (b) (i) is issued a certificate for coverage under Subsection 31A-30-108 (3); and
3645 (ii) has a condition of health that does not meet consistently applied underwriting
3646 criteria as established by the commissioner in accordance with Subsections 31A-30-106 (1)[(i)
3647 and (j)](g) and (h) for which coverage the applicant is applying.
3648 (26) "Uninsurable percentage" for a given calendar year equals UC/CI where, for
3649 purposes of this formula:
3650 (a) "CI" means the carrier's individual coverage count as of December 31 of the
3651 preceding year; and
3652 (b) "UC" means the number of uninsurable individuals who were issued an individual
3653 policy on or after July 1, 1997.
3654 Section 37. Section 31A-30-105 is amended to read:
3655 31A-30-105. Establishment of classes of business.
3656 (1) For [policies that go into] a policy that takes effect on or after January 1, 2011, a
3657 covered carrier may not establish a separate class of business unless:
3658 (a) the covered carrier submits an application to the [department] commissioner to
3659 establish a separate class of business;
3660 (b) the covered carrier demonstrates to the satisfaction of the [department]
3661 commissioner that a separate class of business is justified under the provisions of this section;
3662 and
3663 (c) the [department] commissioner approves the carrier's application for the use of a
3664 separate class of business.
3665 (2) (a) The [presumption of the department shall be] commissioner shall have a
3666 presumption against the use of a separate class of business by a covered insured, except when
3667 the covered carrier demonstrates that [the provisions of] this Subsection (2) [apply] applies.
3668 (b) The [department] commissioner may approve the use of a separate class of business
3669 only if the covered carrier can demonstrate that the use of a separate class of business is

3670 necessary due to substantial differences in either expected claims experience or administrative
3671 costs related to the following reasons:
3672 (i) the covered carrier uses more than one type of system for the marketing and sale of
3673 health benefit plans to covered insureds;
3674 (ii) the covered carrier has acquired a class of business from another covered carrier; or
3675 (iii) the covered carrier provides coverage to one or more association groups.
3676 (3) The commissioner may establish regulations to provide for a period of transition in
3677 order for a covered carrier to come into compliance with Subsection (2) in the instance of
3678 acquisition of an additional class of business from another covered carrier.
3679 (4) The commissioner may approve the establishment of up to five classes of business
3680 per covered carrier upon application to the commissioner and a finding by the commissioner
3681 that such action would substantially enhance the efficiency and fairness of the health insurance
3682 marketplace subject to this chapter.
3683 (5) A covered carrier may not establish a class of business based solely on the
3684 marketing or sale of a health benefit plan as a defined contribution arrangement health benefit
3685 plan, or through the Health Insurance Exchange.
3686 Section 38. Section 31A-30-106 is amended to read:
3687 31A-30-106. Individual premiums -- Rating restrictions -- Disclosure.
3688 (1) Premium rates for health benefit plans for individuals under this chapter are subject
3689 to [the provisions of] this section.
3690 (a) The index rate for a rating period for any class of business may not exceed the
3691 index rate for any other class of business by more than 20%.
3692 (b) (i) For a class of business, the premium rates charged during a rating period to
3693 covered insureds with similar case characteristics for the same or similar coverage, or the rates
3694 that could be charged to the individual under the rating system for that class of business, may
3695 not vary from the index rate by more than 30% of the index rate [provided in Section
3696 31A-30-106.1 ] except as provided under Subsection (1)(b)(ii).
3697 (ii) A carrier that offers individual and small employer health benefit plans may use the

3698 small employer index rates to establish the rate limitations for individual policies, even if some
3699 individual policies are rated below the small employer base rate.
3700 (c) The percentage increase in the premium rate charged to a covered insured for a new
3701 rating period, adjusted pro rata for rating periods less than a year, may not exceed the sum of
3702 the following:
3703 (i) the percentage change in the new business premium rate measured from the first day
3704 of the prior rating period to the first day of the new rating period;
3705 (ii) any adjustment, not to exceed 15% annually and adjusted pro rata for rating periods
3706 of less than one year, due to the claim experience, health status, or duration of coverage of the
3707 covered individuals as determined from the rate manual for the class of business of the carrier
3708 offering an individual health benefit plan; and
3709 (iii) any adjustment due to change in coverage or change in the case characteristics of
3710 the covered insured as determined from the rate manual for the class of business of the carrier
3711 offering an individual health benefit plan.
3712 (d) (i) A carrier offering an individual health benefit plan shall apply rating factors,
3713 including case characteristics, consistently with respect to all covered insureds in a class of
3714 business.
3715 (ii) Rating factors shall produce premiums for identical individuals that:
3716 (A) differ only by the amounts attributable to plan design; and
3717 (B) do not reflect differences due to the nature of the individuals assumed to select
3718 particular health benefit products.
3719 (iii) A carrier offering an individual health benefit plan shall treat all health benefit
3720 plans issued or renewed in the same calendar month as having the same rating period.
3721 (e) For the purposes of this Subsection (1), a health benefit plan that uses a restricted
3722 network provision may not be considered similar coverage to a health benefit plan that does not
3723 use a restricted network provision, provided that use of the restricted network provision results
3724 in substantial difference in claims costs.
3725 (f) A carrier offering a health benefit plan to an individual may not, without prior

3726 approval of the commissioner, use case characteristics other than:
3727 (i) age;
3728 (ii) gender;
3729 (iii) geographic area; and
3730 (iv) family composition.
3731 (g) (i) The commissioner shall establish rules in accordance with Title 63G, Chapter 3,
3732 Utah Administrative Rulemaking Act, to:
3733 (A) implement this chapter; and
3734 (B) assure that rating practices used by carriers who offer health benefit plans to
3735 individuals are consistent with the purposes of this chapter.
3736 (ii) The rules described in Subsection (1)(g)(i) may include rules that:
3737 (A) assure that differences in rates charged for health benefit products by carriers who
3738 offer health benefit plans to individuals are reasonable and reflect objective differences in plan
3739 design, not including differences due to the nature of the individuals assumed to select
3740 particular health benefit products;
3741 (B) prescribe the manner in which case characteristics may be used by carriers who
3742 offer health benefit plans to individuals;
3743 (C) implement the individual enrollment cap under Section 31A-30-110 , including
3744 specifying:
3745 (I) the contents for certification;
3746 (II) auditing standards;
3747 (III) underwriting criteria for uninsurable classification; and
3748 (IV) limitations on high risk enrollees under Section 31A-30-111 ; and
3749 (D) establish the individual enrollment cap under Subsection 31A-30-110 (1).
3750 (h) Before implementing regulations for underwriting criteria for uninsurable
3751 classification, the commissioner shall contract with an independent consulting organization to
3752 develop industry-wide underwriting criteria for uninsurability based on an individual's expected
3753 claims under open enrollment coverage exceeding 325% of that expected for a standard

3754 insurable individual with the same case characteristics.
3755 (i) The commissioner shall revise rules issued for Sections 31A-22-602 and
3756 31A-22-605 regarding individual accident and health policy rates to allow rating in accordance
3757 with this section.
3758 (2) For purposes of Subsection (1)(c)(i), if a health benefit product is a health benefit
3759 product into which the covered carrier is no longer enrolling new covered insureds, the covered
3760 carrier shall use the percentage change in the base premium rate, provided that the change does
3761 not exceed, on a percentage basis, the change in the new business premium rate for the most
3762 similar health benefit product into which the covered carrier is actively enrolling new covered
3763 insureds.
3764 (3) (a) A covered carrier may not transfer a covered insured involuntarily into or out of
3765 a class of business.
3766 (b) A covered carrier may not offer to transfer a covered insured into or out of a class
3767 of business unless the offer is made to transfer all covered insureds in the class of business
3768 without regard to:
3769 (i) case characteristics;
3770 (ii) claim experience;
3771 (iii) health status; or
3772 (iv) duration of coverage since issue.
3773 (4) (a) A carrier who offers a health benefit plan to an individual shall maintain at the
3774 carrier's principal place of business a complete and detailed description of its rating practices
3775 and renewal underwriting practices, including information and documentation that demonstrate
3776 that the carrier's rating methods and practices are:
3777 (i) based upon commonly accepted actuarial assumptions; and
3778 (ii) in accordance with sound actuarial principles.
3779 (b) (i) Each carrier subject to this section shall file with the commissioner, on or before
3780 April 1 of each year, in a form, manner, and containing such information as prescribed by the
3781 commissioner, an actuarial certification certifying that:

3782 (A) the carrier is in compliance with this chapter; and
3783 (B) the rating methods of the carrier are actuarially sound.
3784 (ii) A copy of the certification required by Subsection (4)(b)(i) shall be retained by the
3785 carrier at the carrier's principal place of business.
3786 (c) A carrier shall make the information and documentation described in this
3787 Subsection (4) available to the commissioner upon request.
3788 (d) Records submitted to the commissioner under this section shall be maintained by
3789 the commissioner as protected records under Title 63G, Chapter 2, Government Records
3790 Access and Management Act.
3791 Section 39. Section 31A-30-106.1 is amended to read:
3792 31A-30-106.1. Small employer premiums -- Rating restrictions -- Disclosure.
3793 (1) Premium rates for small employer health benefit plans under this chapter are
3794 subject to [the provisions of] this section for a health benefit plan that is issued or renewed, on
3795 or after January 1, 2011.
3796 (2) (a) The index rate for a rating period for any class of business may not exceed the
3797 index rate for any other class of business by more than 20%.
3798 (b) For a class of business, the premium rates charged during a rating period to covered
3799 insureds with similar case characteristics for the same or similar coverage, or the rates that
3800 could be charged to an employer group under the rating system for that class of business, may
3801 not vary from the index rate by more than 30% of the index rate, except when catastrophic
3802 mental health coverage is selected as provided in Subsection 31A-22-625 (2)(d).
3803 (3) The percentage increase in the premium rate charged to a covered insured for a new
3804 rating period, adjusted pro rata for rating periods less than a year, may not exceed the sum of
3805 the following:
3806 (a) the percentage change in the new business premium rate measured from the first
3807 day of the prior rating period to the first day of the new rating period;
3808 (b) any adjustment, not to exceed 15% annually and adjusted pro rata for rating periods
3809 of less than one year, due to the claim experience, health status, or duration of coverage of the

3810 covered individuals as determined from the small employer carrier's rate manual for the class of
3811 business, except when catastrophic mental health coverage is selected as provided in
3812 Subsection 31A-22-625 (2)(d); and
3813 (c) any adjustment due to change in coverage or change in the case characteristics of
3814 the covered insured as determined for the class of business from the small employer carrier's
3815 rate manual.
3816 (4) (a) Adjustments in rates for claims experience, health status, and duration from
3817 issue may not be charged to individual employees or dependents.
3818 (b) Rating adjustments and factors, including case characteristics, shall be applied
3819 uniformly and consistently to the rates charged for all employees and dependents of the small
3820 employer.
3821 (c) Rating factors shall produce premiums for identical groups that:
3822 (i) differ only by the amounts attributable to plan design; and
3823 (ii) do not reflect differences due to the nature of the groups assumed to select
3824 particular health benefit products.
3825 (d) A small employer carrier shall treat all health benefit plans issued or renewed in the
3826 same calendar month as having the same rating period.
3827 (5) A health benefit plan that uses a restricted network provision may not be considered
3828 similar coverage to a health benefit plan that does not use a restricted network provision,
3829 provided that use of the restricted network provision results in substantial difference in claims
3830 costs.
3831 (6) The small employer carrier may not use case characteristics other than the
3832 following:
3833 (a) age of the employee, as determined at the beginning of the plan year, limited to:
3834 (i) the following age bands:
3835 (A) less than 20;
3836 (B) 20-24;
3837 (C) 25-29;

3838 (D) 30-34;
3839 (E) 35-39;
3840 (F) 40-44;
3841 (G) 45-49;
3842 (H) 50-54;
3843 (I) 55-59;
3844 (J) 60-64; and
3845 (K) 65 and above; and
3846 (ii) a standard slope ratio range for each age band, applied to each family composition
3847 tier rating structure under Subsection (6)(c):
3848 (A) as developed by the [department] commissioner by administrative rule;
3849 (B) not to exceed an overall ratio of 5:1; and
3850 (C) the age slope ratios for each age band may not overlap;
3851 (b) geographic area; and
3852 (c) family composition, limited to:
3853 (i) an overall ratio of 5:1 or less; and
3854 (ii) a four tier rating structure that includes:
3855 (A) employee only;
3856 (B) employee plus spouse;
3857 (C) employee plus a dependent or dependents; and
3858 (D) a family, consisting of an employee plus spouse, and a dependent or dependents.
3859 (7) If a health benefit plan is a health benefit plan into which the small employer carrier
3860 is no longer enrolling new covered insureds, the small employer carrier shall use the percentage
3861 change in the base premium rate, provided that the change does not exceed, on a percentage
3862 basis, the change in the new business premium rate for the most similar health benefit product
3863 into which the small employer carrier is actively enrolling new covered insureds.
3864 (8) (a) A covered carrier may not transfer a covered insured involuntarily into or out of
3865 a class of business.

3866 (b) A covered carrier may not offer to transfer a covered insured into or out of a class
3867 of business unless the offer is made to transfer all covered insureds in the class of business
3868 without regard to:
3869 (i) case characteristics;
3870 (ii) claim experience;
3871 (iii) health status; or
3872 (iv) duration of coverage since issue.
3873 (9) (a) Each small employer carrier shall maintain at the small employer carrier's
3874 principal place of business a complete and detailed description of its rating practices and
3875 renewal underwriting practices, including information and documentation that demonstrate that
3876 the small employer carrier's rating methods and practices are:
3877 (i) based upon commonly accepted actuarial assumptions; and
3878 (ii) in accordance with sound actuarial principles.
3879 (b) (i) Each small employer carrier shall file with the commissioner on or before April
3880 1 of each year, in a form and manner and containing information as prescribed by the
3881 commissioner, an actuarial certification certifying that:
3882 (A) the small employer carrier is in compliance with this chapter; and
3883 (B) the rating methods of the small employer carrier are actuarially sound.
3884 (ii) A copy of the certification required by Subsection (9)(b)(i) shall be retained by the
3885 small employer carrier at the small employer carrier's principal place of business.
3886 (c) A small employer carrier shall make the information and documentation described
3887 in this Subsection (9) available to the commissioner upon request.
3888 (10) (a) The commissioner shall, by July 1, 2010, establish rules in accordance with
3889 Title 63G, Chapter 3, Utah Administrative Rulemaking Act, to:
3890 (i) implement this chapter; and
3891 (ii) assure that rating practices used by small employer carriers under this section and
3892 carriers for individual plans under Section 31A-30-106 , [as effective] in effect on January 1,
3893 2011, are consistent with the purposes of this chapter.

3894 (b) The rules may:
3895 (i) assure that differences in rates charged for health benefit plans by carriers are
3896 reasonable and reflect objective differences in plan design, not including differences due to the
3897 nature of the groups or individuals assumed to select particular health benefit plans; and
3898 (ii) prescribe the manner in which case characteristics may be used by small employer
3899 and individual carriers.
3900 (11) Records submitted to the commissioner under this section shall be maintained by
3901 the commissioner as protected records under Title 63G, Chapter 2, Government Records
3902 Access and Management Act.
3903 Section 40. Section 31A-30-106.5 is amended to read:
3904 31A-30-106.5. Conversion policy -- Premiums -- Rating restrictions.
3905 (1) [All provisions of Section 31A-30-106.1 apply] Section 31A-30-106 applies to
3906 conversion policies.
3907 (2) Conversion policy premium rates may not exceed by more than 35% the index rate
3908 for small employers with similar case characteristics for any class of business in which the
3909 policy form has been [approved] filed.
3910 (3) An insurer may not consider pregnancy of a covered insured in determining its
3911 conversion policy premium rates.
3912 Section 41. Section 31A-30-108 is amended to read:
3913 31A-30-108. Eligibility for small employer and individual market.
3914 (1) (a) Small employer carriers shall accept residents for small group coverage as set
3915 forth in the Health Insurance Portability and Accountability Act, [P.L. 104-191, 110 Stat.
3916 1962,] Sec. 2701(f) and 2711(a).
3917 (b) Individual carriers shall accept residents for individual coverage pursuant to:
3918 (i) [to P.L. 104-191, 110 Stat. 1979] Health Insurance Portability and Accountability
3919 Act, Sec. 2741(a)-(b); and
3920 (ii) Subsection (3).
3921 (2) (a) Small employer carriers shall offer to accept all eligible employees and their

3922 dependents at the same level of benefits under any health benefit plan provided to a small
3923 employer.
3924 (b) Small employer carriers may:
3925 (i) request a small employer to submit a copy of the small employer's quarterly income
3926 tax withholdings to determine whether the employees for whom coverage is provided or
3927 requested are bona fide employees of the small employer; and
3928 (ii) deny or terminate coverage if the small employer refuses to provide documentation
3929 requested under Subsection (2)(b)(i).
3930 (3) Except as provided in Subsections (5) and (6) and Section 31A-30-110 , individual
3931 carriers shall accept for coverage individuals to whom all of the following conditions apply:
3932 (a) the individual is not covered or eligible for coverage:
3933 (i) (A) as an employee of an employer;
3934 (B) as a member of an association; or
3935 (C) as a member of any other group; and
3936 (ii) under:
3937 (A) a health benefit plan; or
3938 (B) a self-insured arrangement that provides coverage similar to that provided by a
3939 health benefit plan as defined in Section 31A-1-301 ;
3940 (b) the individual is not covered and is not eligible for coverage under any public
3941 health benefits arrangement including:
3942 (i) the Medicare program established under Title XVIII of the Social Security Act;
3943 (ii) any act of Congress or law of this or any other state that provides benefits
3944 comparable to the benefits provided under this chapter; or
3945 (iii) coverage under the Comprehensive Health Insurance Pool Act created in Chapter
3946 29, Comprehensive Health Insurance Pool Act;
3947 (c) unless the maximum benefit has been reached the individual is not covered or
3948 eligible for coverage under any:
3949 (i) Medicare supplement policy;

3950 (ii) conversion option;
3951 (iii) continuation or extension under COBRA; or
3952 (iv) state extension;
3953 (d) the individual has not terminated or declined coverage described in Subsection
3954 (3)(a), (b), or (c) within 93 days of application for coverage, unless the individual is eligible for
3955 individual coverage under [P.L. 104-191, 110 Stat. 1979] Health Insurance Portability and
3956 Accountability Act, Sec. 2741(b), in which case, the requirement of this Subsection (3)(d) does
3957 not apply; and
3958 (e) the individual is certified as ineligible for the Health Insurance Pool if:
3959 (i) the individual applies for coverage with the Comprehensive Health Insurance Pool
3960 within 30 days after being rejected or refused coverage by the covered carrier and reapplies for
3961 coverage with that covered carrier within 30 days after the date of issuance of a certificate
3962 under Subsection 31A-29-111 (5)(c); or
3963 (ii) the individual applies for coverage with any individual carrier within 45 days after:
3964 (A) notice of cancellation of coverage under Subsection 31A-29-115 (1); or
3965 (B) the date of issuance of a certificate under Subsection 31A-29-111 (5)(c) if the
3966 individual applied first for coverage with the Comprehensive Health Insurance Pool.
3967 (4) (a) If coverage is obtained under Subsection (3)(e)(i) and the required premium is
3968 paid, the effective date of coverage shall be the first day of the month following the individual's
3969 submission of a completed insurance application to that covered carrier.
3970 (b) If coverage is obtained under Subsection (3)(e)(ii) and the required premium is
3971 paid, the effective date of coverage shall be the day following the:
3972 (i) cancellation of coverage under Subsection 31A-29-115 (1); or
3973 (ii) submission of a completed insurance application to the Comprehensive Health
3974 Insurance Pool.
3975 (5) (a) An individual carrier is not required to accept individuals for coverage under
3976 Subsection (3) if the carrier issues no new individual policies in the state after July 1, 1997.
3977 (b) A carrier described in Subsection (5)(a) may not issue new individual policies in

3978 the state for five years from July 1, 1997.
3979 (c) Notwithstanding Subsection (5)(b), a carrier may request permission to issue new
3980 policies after July 1, 1999, which may only be granted if:
3981 (i) the carrier accepts uninsurables as is required of a carrier entering the market under
3982 Subsection 31A-30-110 ; and
3983 (ii) the commissioner finds that the carrier's issuance of new individual policies:
3984 (A) is in the best interests of the state; and
3985 (B) does not provide an unfair advantage to the carrier.
3986 (6) (a) If the Comprehensive Health Insurance Pool, as set forth under [Title 31A],
3987 Chapter 29, Comprehensive Health Insurance Pool Act, is dissolved or discontinued, or if
3988 enrollment is capped or suspended, an individual carrier may decline to accept individuals
3989 applying for individual enrollment, other than individuals applying for coverage as set forth in
3990 [P.L. 104-191, 110 Stat. 1979] Health Insurance Portability and Accountability Act, Sec. 2741
3991 (a)-(b).
3992 (b) Within two calendar days of taking action under Subsection (6)(a), an individual
3993 carrier will provide written notice to the [Utah Insurance Department] department.
3994 (7) (a) If a small employer carrier offers health benefit plans to small employers
3995 through a network plan, the small employer carrier may:
3996 (i) limit the employers that may apply for the coverage to those employers with eligible
3997 employees who live, reside, or work in the service area for the network plan; and
3998 (ii) within the service area of the network plan, deny coverage to an employer if the
3999 small employer carrier has demonstrated to the commissioner that the small employer carrier:
4000 (A) will not have the capacity to deliver services adequately to enrollees of any
4001 additional groups because of the small employer carrier's obligations to existing group contract
4002 holders and enrollees; and
4003 (B) applies this section uniformly to all employers without regard to:
4004 (I) the claims experience of an employer, an employer's employee, or a dependent of an
4005 employee; or

4006 (II) any health status-related factor relating to an employee or dependent of an
4007 employee.
4008 (b) (i) A small employer carrier that denies a health benefit product to an employer in
4009 any service area in accordance with this section may not offer coverage in the small employer
4010 market within the service area to any employer for a period of 180 days after the date the
4011 coverage is denied.
4012 (ii) This Subsection (7)(b) does not:
4013 (A) limit the small employer carrier's ability to renew coverage that is in force; or
4014 (B) relieve the small employer carrier of the responsibility to renew coverage that is in
4015 force.
4016 (c) Coverage offered within a service area after the 180-day period specified in
4017 Subsection (7)(b) is subject to the requirements of this section.
4018 Section 42. Section 31A-30-110 is amended to read:
4019 31A-30-110. Individual enrollment cap.
4020 (1) The commissioner shall set the individual enrollment cap at .5% on July 1, 1997.
4021 (2) The commissioner shall raise the individual enrollment cap by .5% at the later of
4022 the following dates:
4023 (a) six months from the last increase in the individual enrollment cap; or
4024 (b) the date when CCI/TI is greater than .90, where:
4025 (i) "CCI" is the total individual coverage count for all carriers certifying that their
4026 uninsurable percentage has reached the individual enrollment cap; and
4027 (ii) "TI" is the total individual coverage count for all carriers.
4028 (3) The commissioner may establish a minimum number of uninsurable individuals
4029 that a carrier entering the market who is subject to this chapter must accept under the individual
4030 enrollment provisions of this chapter.
4031 (4) Beginning July 1, 1997, an individual carrier may decline to accept individuals
4032 applying for individual enrollment under Subsection 31A-30-108 (3), other than individuals
4033 applying for coverage as set forth in P.L. 104-191, 110 Stat. 1979, Sec. 2741 (a)-(b), if:

4034 (a) the uninsurable percentage for that carrier equals or exceeds the cap established in
4035 Subsection (1); and
4036 (b) the covered carrier has certified on forms provided by the commissioner that its
4037 uninsurable percentage equals or exceeds the individual enrollment cap.
4038 (5) The department may audit a carrier's records to verify whether the carrier's
4039 uninsurable classification meets industry standards for underwriting criteria as established by
4040 the commissioner in accordance with Subsection 31A-30-106 (1)[(i)](h).
4041 (6) (a) If the commissioner determines that individual enrollment is causing a
4042 substantial adverse effect on premiums, enrollment, or experience, the commissioner may
4043 suspend, limit, or delay further individual enrollment for up to 12 months.
4044 (b) The commissioner shall adopt rules to establish a uniform methodology for
4045 calculating and reporting loss ratios for individual policies for determining whether the
4046 individual enrollment provisions of Section 31A-30-108 should be waived for an individual
4047 carrier experiencing significant and adverse financial impact as a result of complying with
4048 those provisions.
4049 Section 43. Section 31A-30-112 is amended to read:
4050 31A-30-112. Employee participation levels.
4051 (1) (a) Except as provided in Subsection (2) and Section 31A-30-206 , a requirement
4052 used by a covered carrier in determining whether to provide coverage to a small employer,
4053 including a requirement for minimum participation of eligible employees and minimum
4054 employer contributions, shall be applied uniformly among all small employers with the same
4055 number of eligible employees applying for coverage or receiving coverage from the covered
4056 carrier.
4057 (b) In addition to applying Subsection 31A-1-301 [(121)](123), a covered carrier may
4058 require that a small employer have a minimum of two eligible employees to meet participation
4059 requirements.
4060 (2) A covered carrier may not increase a requirement for minimum employee
4061 participation or a requirement for minimum employer contribution applicable to a small

4062 employer at any time after the small employer is accepted for coverage.
4063 Section 44. Section 31A-31-108 is amended to read:
4064 31A-31-108. Assessment of insurers.
4065 (1) For purposes of this section:
4066 (a) The commissioner shall by rule made in accordance with Title 63G, Chapter 3,
4067 Utah Administrative Rulemaking Act, define:
4068 (i) "annuity consideration";
4069 (ii) "membership fees";
4070 (iii) "other fees";
4071 (iv) "deposit-type contract funds"; and
4072 (v) "other considerations in Utah."
4073 (b) "Utah consideration" means:
4074 (i) the total premiums written for Utah risks;
4075 (ii) annuity consideration;
4076 (iii) membership fees collected by the insurer;
4077 (iv) other fees collected by the insurer;
4078 (v) deposit-type contract funds; and
4079 (vi) other considerations in Utah.
4080 (c) "Utah risks" means insurance coverage on the lives, health, or against the liability
4081 of persons residing in Utah, or on property located in Utah, other than property temporarily in
4082 transit through Utah.
4083 (2) To implement this chapter, Section 34A-2-110 , and Section 76-6-521 , the
4084 commissioner may assess each admitted insurer and each nonadmitted insurer transacting
4085 insurance under Chapter 15, Parts 1, Unauthorized Insurers and Surplus Lines, and 2,
4086 [Unauthorized Insurers] Risk Retention Groups Act, an annual fee as follows:
4087 (a) $150 for an insurer, if the sum of the Utah consideration for that insurer is less than
4088 or equal to $1,000,000;
4089 (b) $400 for an insurer, if the sum of the Utah consideration for that insurer is greater

4090 than $1,000,000 but is less than or equal to $2,500,000;
4091 (c) $700 for an insurer, if the sum of the Utah consideration for that insurer is greater
4092 than $2,500,000 but is less than or equal to $5,000,000;
4093 (d) $1,350 for an insurer, if the sum of the Utah consideration for that insurer is greater
4094 than $5,000,000 but less than or equal to $10,000,000;
4095 (e) $5,150 for an insurer, if the sum of the Utah consideration for that insurer is greater
4096 than $10,000,000 but less than $50,000,000; and
4097 (f) $12,350 for an insurer, if the sum of the Utah consideration for that insurer equals
4098 or exceeds $50,000,000.
4099 (3) [All money] Money received by the state under this section shall be deposited [in
4100 the General Fund as a dedicated credit of the department for the purpose of providing funds to
4101 pay for any costs and expenses incurred by the department in the administration, investigation,
4102 and enforcement of this chapter, Section 34A-2-110 , and Section 76-6-521 .] into the Insurance
4103 Fraud Investigation Restricted Account created in Subsection (4).
4104 (4) (a) There is created in the General Fund a restricted account known as the
4105 "Insurance Fraud Investigation Restricted Account."
4106 (b) The Insurance Fraud Investigation Restricted Account shall consist of the money
4107 received by the commissioner under this section and Section 31A-31-109 .
4108 (c) The commissioner shall administer the Insurance Fraud Investigation Restricted
4109 Account. Subject to appropriations by the Legislature, the commissioner shall use the money
4110 deposited into the Insurance Fraud Investigation Restricted Account to pay for a cost or
4111 expense incurred by the commissioner in the administration, investigation, and enforcement of
4112 this chapter, Section 34A-2-110 , and Section 76-6-521 .
4113 Section 45. Section 31A-31-109 is amended to read:
4114 31A-31-109. Civil penalties.
4115 (1) In addition to other penalties provided by law, a person who violates this chapter:
4116 (a) is subject to the following civil penalties:
4117 (i) the person shall make full restitution; and

4118 (ii) the person shall pay the costs of enforcement of this chapter for the case in which
4119 the person is found to have violated this chapter:
4120 (A) as determined by the one or more authorized agencies involved; and
4121 (B) including costs of:
4122 (I) investigators;
4123 (II) attorneys; and
4124 (III) other public employees; and
4125 (b) in the discretion of the court, may be required to pay to the state a civil penalty not
4126 to exceed three times that amount of value improperly sought or received from the fraudulent
4127 insurance act.
4128 (2) (a) Money paid under Subsection (1)(a)(i) shall be paid to the person damaged by
4129 the fraudulent insurance act.
4130 (b) Money paid under Subsection (1)(a)(ii) shall be paid to each applicable authorized
4131 agency in the following order:
4132 (i) to the [General Fund as a dedicated credit of the department] Insurance Fraud
4133 Investigation Restricted Account created in Section 31A-31-108 for the costs of enforcement
4134 incurred by the [department] commissioner;
4135 (ii) to the General Fund for the costs of enforcement incurred by a state agency other
4136 than the [department] commissioner;
4137 (iii) to the applicable political subdivision for the costs of enforcement incurred by the
4138 political subdivision; and
4139 (iv) to the applicable criminal investigative department or agency of the United States
4140 for the costs of enforcement incurred by the department or agency.
4141 (c) Money paid under Subsection (1)(b) shall be paid into the General Fund.
4142 (3) (a) A civil penalty assessed under Subsection (1) shall be awarded by the court as
4143 part of its judgment in both criminal and civil actions.
4144 (b) A criminal action need not be brought against a person in order for that person to be
4145 civilly liable under this section.

4146 Section 46. Section 31A-35-202 is amended to read:
4147 31A-35-202. Board responsibilities.
4148 (1) The board shall:
4149 [(1)] (a) meet:
4150 [(a)] (i) at least quarterly; and
4151 [(b)] (ii) at the call of the chair;
4152 [(2)] (b) make written recommendations to the commissioner for rules governing the
4153 following aspects of the bail bond surety insurance business:
4154 [(a)] (i) qualifications, applications, and fees for obtaining:
4155 [(i)] (A) a license required by this Section 31A-35-401 ; or
4156 [(ii)] (B) a certificate;
4157 [(b)] (ii) limits on the aggregate amounts of bail bonds;
4158 [(c)] (iii) unprofessional conduct;
4159 [(d)] (iv) procedures for hearing and resolving allegations of unprofessional conduct;
4160 and
4161 [(e)] (v) sanctions for unprofessional conduct;
4162 [(3)] (c) screen:
4163 [(a)] (i) bail bond surety company license applications; and
4164 [(b)] (ii) persons applying for a bail bond surety company license; and
4165 [(4)] (d) recommend to the commissioner action regarding the granting, renewing,
4166 suspending, revoking, and reinstating of bail bond surety company license[; and].
4167 (2) The board may:
4168 [(5)] (a) conduct investigations of allegations of unprofessional conduct on the part of
4169 persons or bail bond sureties involved in the business of bail bond surety insurance; and
4170 (b) provide the results of the investigations described in Subsection [(5)] (2)(a) to the
4171 commissioner with recommendations for:
4172 (i) action; and
4173 (ii) any appropriate sanctions.

4174 Section 47. Section 31A-35-406 is amended to read:
4175 31A-35-406. Renewal and reinstatement.
4176 (1) (a) A license under this chapter expires annually on August 14. To renew its
4177 license under this chapter, on or before [the last day of the month in which the license expires]
4178 July 15 a bail bond surety company shall:
4179 (i) complete and submit a renewal application to the department; and
4180 (ii) pay the department the applicable renewal fee established in accordance with
4181 Section 31A-3-103 .
4182 (b) A bail bond surety company shall renew its license under this chapter annually as
4183 established by department rule, regardless of when the license is issued.
4184 (2) A bail bond surety company may apply for reinstatement of an expired bail bond
4185 surety company license within one year following the expiration of the license under
4186 Subsection (1) by:
4187 (a) submitting the renewal application required by Subsection (1); and
4188 (b) paying a license reinstatement fee established in accordance with Section
4189 31A-3-103 .
4190 (3) If a bail bond surety company license has been expired for more than one year, the
4191 person applying for reinstatement of the bail bond surety license shall:
4192 (a) submit a new application form to the commissioner; and
4193 (b) pay the application fee established in accordance with Section 31A-3-103 .
4194 (4) If a bail bond surety company license is suspended, the applicant may not submit an
4195 application for a bail bond surety company license until after the end of the period of
4196 suspension.
4197 (5) A fee collected under this section shall be deposited in the restricted account created
4198 in Section 31A-35-407 .
4199 Section 48. Section 31A-35-602 is amended to read:
4200 31A-35-602. Place of business -- Records to be kept there.
4201 (1) (a) [Every] A bail bond surety company shall have and maintain in this state a place

4202 of business:
4203 (i) accessible to the public; and
4204 (ii) where the bail bond surety company principally conducts transactions authorized by
4205 its bail bond surety company license.
4206 (b) The address of the place of business described in Subsection (1)(a) shall appear
4207 upon:
4208 (i) the application for a bail bond surety company license; and
4209 (ii) [the] a bail bond surety company license issued under this chapter.
4210 (c) In addition to complying with Subsection (1)(b), a bail bond surety company shall
4211 register and maintain with the commissioner the following at which the commissioner may
4212 contact the bail bond surety company:
4213 (i) a telephone number; and
4214 (ii) a business email address.
4215 [(c)] (d) A bail bond surety company shall notify the commissioner [of any change in
4216 the address required by this Subsection (1) within 20 days after the change.] within 20 days of a
4217 change in the bail bond surety company's:
4218 (i) place of business address;
4219 (ii) telephone number; or
4220 (iii) business email address.
4221 [(d)] (e) This section does not prohibit a bail bond surety company from maintaining
4222 the place of business required under this section in the licensee's residence, if the residence is
4223 in Utah.
4224 (2) The bail bond surety company shall keep at the place of business described in
4225 Subsection (1)(a) the records required under Section 31A-35-604 .
4226 Section 49. Section 31A-37-103 is amended to read:
4227 31A-37-103. Chapter exclusivity.
4228 (1) Except as provided in [Subsection] Subsections (2) and (3) or otherwise provided
4229 in this chapter, a provision of this title other than this chapter does not apply to a captive

4230 insurance company.
4231 (2) To the extent that a provision of the following does not contradict this chapter, the
4232 provision applies to a captive insurance company that receives a certificate of authority under
4233 this chapter:
4234 (a) Chapter 2, Administration of the Insurance Laws;
4235 (b) Chapter 4, Insurers in General;
4236 (c) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
4237 (d) Chapter 14, Foreign Insurers;
4238 (e) Chapter 16, Insurance Holding Companies;
4239 (f) Chapter 17, Determination of Financial Condition;
4240 (g) Chapter 18, Investments;
4241 (h) Chapter 19a, Utah Rate Regulation Act;
4242 (i) Chapter 27, Delinquency Administrative Action Provisions; and
4243 (j) Chapter 27a, Insurer Receivership Act.
4244 [(2)] (3) In addition to this chapter, and subject to Section 31A-37a-103 :
4245 (a) Chapter 37a, Special Purpose Financial Captive Insurance Company Act, applies to
4246 a special purpose financial captive insurance company; and
4247 (b) for purposes of a special purpose financial captive insurance company, a reference
4248 in this chapter to "this chapter" includes a reference to Chapter 37a, Special Purpose Financial
4249 Captive Insurance Company Act.
4250 Section 50. Section 31A-37-202 is amended to read:
4251 31A-37-202. Permissive areas of insurance.
4252 (1) (a) Except as provided in Subsection (1)(b), when permitted by its articles of
4253 incorporation or charter, a captive insurance company may apply to the commissioner for a
4254 certificate of authority to do all insurance authorized by this title except workers' compensation
4255 insurance.
4256 (b) Notwithstanding Subsection (1)(a):
4257 (i) a pure captive insurance company may not insure a risk other than a risk of:

4258 (A) its parent or affiliate;
4259 (B) a controlled unaffiliated business; or
4260 (C) a combination of Subsections (1)(b)(i)(A) and (B);
4261 (ii) an association captive insurance company may not insure a risk other than a risk of:
4262 (A) an affiliate;
4263 (B) a member organization of its association; and
4264 (C) an affiliate of a member organization of its association;
4265 (iii) an industrial insured captive insurance company may not insure a risk other than a
4266 risk of:
4267 (A) an industrial insured that is part of the industrial insured group;
4268 (B) an affiliate of an industrial insured that is part of the industrial insured group; and
4269 (C) a controlled unaffiliated business of:
4270 (I) an industrial insured that is part of the industrial insured group; or
4271 (II) an affiliate of an industrial insured that is part of the industrial insured group;
4272 (iv) a special purpose captive insurance company may only insure a risk of its parent;
4273 (v) a captive insurance company may not provide:
4274 (A) personal motor vehicle insurance coverage;
4275 (B) homeowner's insurance coverage; or
4276 (C) a component of a coverage described in this Subsection (1)(b)(v); and
4277 (vi) a captive insurance company may not accept or cede reinsurance except as
4278 provided in Section 31A-37-303 .
4279 (c) Notwithstanding Subsection (1)(b)(iv), for a risk approved by the commissioner a
4280 special purpose captive insurance company may provide:
4281 (i) insurance;
4282 (ii) reinsurance; or
4283 (iii) both insurance and reinsurance.
4284 (2) To conduct insurance business in this state a captive insurance company shall:
4285 (a) obtain from the commissioner a certificate of authority authorizing it to conduct

4286 insurance business in this state;
4287 (b) hold at least once each year in this state:
4288 (i) a board of directors meeting; or
4289 (ii) in the case of a reciprocal insurer, a subscriber's advisory committee meeting;
4290 (c) maintain in this state:
4291 (i) the principal place of business of the captive insurance company; or
4292 (ii) in the case of a branch captive insurance company, the principal place of business
4293 for the branch operations of the branch captive insurance company; and
4294 (d) except as provided in Subsection (3), appoint a resident registered agent to accept
4295 service of process and to otherwise act on behalf of the captive insurance company in this state.
4296 (3) Notwithstanding Subsection (2)(d), in the case of a captive insurance company
4297 formed as a corporation or a reciprocal insurer, if the registered agent cannot with reasonable
4298 diligence be found at the registered office of the captive insurance company, the commissioner
4299 is the agent of the captive insurance company upon whom process, notice, or demand may be
4300 served.
4301 (4) (a) Before receiving a certificate of authority, a captive insurance company:
4302 (i) formed as a corporation shall file with the commissioner:
4303 (A) a certified copy of:
4304 (I) articles of incorporation or the charter of the corporation; and
4305 (II) bylaws of the corporation;
4306 (B) a statement under oath of the president and secretary of the corporation showing
4307 the financial condition of the corporation; and
4308 (C) any other statement or document required by the commissioner under Section
4309 31A-37-106 ;
4310 (ii) formed as a reciprocal shall:
4311 (A) file with the commissioner:
4312 (I) a certified copy of the power of attorney of the attorney-in-fact of the reciprocal;
4313 (II) a certified copy of the subscribers' agreement of the reciprocal;

4314 (III) a statement under oath of the attorney-in-fact of the reciprocal showing the
4315 financial condition of the reciprocal; and
4316 (IV) any other statement or document required by the commissioner under Section
4317 31A-37-106 ; and
4318 (B) submit to the commissioner for approval a description of the:
4319 (I) coverages;
4320 (II) deductibles;
4321 (III) coverage limits;
4322 (IV) rates; and
4323 (V) any other information the commissioner requires under Section 31A-37-106 .
4324 (b) (i) If there is a subsequent material change in an item in the description required
4325 under Subsection (4)(a)(ii)(B) for a reciprocal captive insurance company, the reciprocal
4326 captive insurance company shall submit to the commissioner for approval an appropriate
4327 revision to the description required under Subsection (4)(a)(ii)(B).
4328 (ii) A reciprocal captive insurance company that is required to submit a revision under
4329 Subsection (4)(b)(i) may not offer any additional types of insurance until the commissioner
4330 approves a revision of the description.
4331 (iii) A reciprocal captive insurance company shall inform the commissioner of a
4332 material change in a rate within 30 days of the adoption of the change.
4333 (c) In addition to the information required by Subsection (4)(a), an applicant captive
4334 insurance company shall file with the commissioner evidence of:
4335 (i) the amount and liquidity of the assets of the applicant captive insurance company
4336 relative to the risks to be assumed by the applicant captive insurance company;
4337 (ii) the adequacy of the expertise, experience, and character of the person who will
4338 manage the applicant captive insurance company;
4339 (iii) the overall soundness of the plan of operation of the applicant captive insurance
4340 company;
4341 (iv) the adequacy of the loss prevention programs for the following of the applicant

4342 captive insurance company:
4343 (A) a parent;
4344 (B) a member organization; or
4345 (C) an industrial insured; and
4346 (v) any other factor the commissioner:
4347 (A) adopts by rule under Section 31A-37-106 ; and
4348 (B) considers relevant in ascertaining whether the applicant captive insurance company
4349 will be able to meet the policy obligations of the applicant captive insurance company.
4350 (d) In addition to the information required by Subsections (4)(a), (b), and (c), an
4351 applicant sponsored captive insurance company shall file with the commissioner:
4352 (i) a business plan at the level of detail required by the commissioner under Section
4353 31A-37-106 demonstrating:
4354 (A) the manner in which the applicant sponsored captive insurance company will
4355 account for the losses and expenses of each protected cell; and
4356 (B) the manner in which the applicant sponsored captive insurance company will report
4357 to the commissioner the financial history, including losses and expenses, of each protected cell;
4358 (ii) a statement acknowledging that the applicant sponsored captive insurance company
4359 will make all financial records of the applicant sponsored captive insurance company,
4360 including records pertaining to a protected cell, available for inspection or examination by the
4361 commissioner;
4362 (iii) a contract or sample contract between the applicant sponsored captive insurance
4363 company and a participant; and
4364 (iv) evidence that expenses will be allocated to each protected cell in an equitable
4365 manner.
4366 (5) (a) Information submitted pursuant to Subsection (4) is classified as a protected
4367 record under Title 63G, Chapter 2, Government Records Access and Management Act.
4368 (b) Notwithstanding Title 63G, Chapter 2, Government Records Access and
4369 Management Act, the commissioner may disclose information submitted pursuant to

4370 Subsection (4) to a public official having jurisdiction over the regulation of insurance in
4371 another state if:
4372 (i) the public official receiving the information agrees in writing to maintain the
4373 confidentiality of the information; and
4374 (ii) the laws of the state in which the public official serves require the information to be
4375 confidential.
4376 (c) This Subsection (5) does not apply to information provided by an industrial insured
4377 captive insurance company insuring the risks of an industrial insured group.
4378 (6) (a) A captive insurance company shall pay to the department the following
4379 nonrefundable fees established by the department under Sections 31A-3-103 , 31A-3-304 , and
4380 63J-1-504 :
4381 (i) a fee for examining, investigating, and processing, by a department employee, of an
4382 application for a certificate of authority made by a captive insurance company;
4383 (ii) a fee for obtaining a certificate of authority for the year the captive insurance
4384 company is issued a certificate of authority by the department; and
4385 (iii) a certificate of authority renewal fee.
4386 (b) The commissioner may:
4387 (i) assign a department employee or retain legal, financial, and examination services
4388 from outside the department to perform the services described in:
4389 (A) Subsection (6)(a); and
4390 (B) Section 31A-37-502 ; and
4391 (ii) charge the reasonable cost of services described in Subsection (6)(b)(i) to the
4392 applicant captive insurance company.
4393 (7) If the commissioner is satisfied that the documents and statements filed by the
4394 applicant captive insurance company comply with this chapter, the commissioner may grant a
4395 certificate of authority authorizing the company to do insurance business in this state.
4396 (8) A certificate of authority granted under this section expires annually and must be
4397 renewed by July 1 of each year.

4398 Section 51. Section 31A-37-504 is amended to read:
4399 31A-37-504. Examinations for branch and alien captive insurance companies.
4400 [(1) This section applies to all business written by a captive insurance company.]
4401 [(2) Notwithstanding this section, the]
4402 (1) The examination for a branch captive insurance company shall be of branch
4403 business and branch operations only, if the branch captive insurance company:
4404 (a) provides annually to the commissioner a certificate of compliance, or an equivalent,
4405 issued by or filed with the licensing authority of the jurisdiction in which the branch captive
4406 insurance company is formed; and
4407 (b) demonstrates to the commissioner's satisfaction that the branch captive insurance
4408 company is operating in sound financial condition in accordance with [all] the applicable laws
4409 and regulations of the jurisdiction in which the branch captive insurance company is formed.
4410 [(3)] (2) As a condition of obtaining a certificate of authority, an alien captive
4411 insurance company shall grant authority to the commissioner to examine the affairs of the alien
4412 captive insurance company in the jurisdiction in which the alien captive insurance company is
4413 formed.
4414 [(4) To the extent that the provisions of Chapters 2, 4, 5, 14, 16, 17, 18, 19a, 27, and
4415 27a do not contradict this section, these chapters apply to captive insurance companies that
4416 have received a certificate of authority under this chapter.]
4417 Section 52. Section 31A-40-308 is enacted to read:
4418 31A-40-308. Material changes.
4419 A professional employer organization shall notify the commissioner within 30 days of a
4420 change in:
4421 (1) ownership;
4422 (2) an address or telephone number;
4423 (3) a contact person; or
4424 (4) business email address at which the commissioner may contact the professional
4425 employer organization.

4426 Section 53. Section 59-9-105 is amended to read:
4427 59-9-105. Tax on certain insurers to pay for relative value study and other
4428 publications or services.
4429 (1) [Each] An insurer [providing] that provides coverage for motor vehicle liability,
4430 uninsured motorist, and personal injury protection shall pay to the State Tax Commission on or
4431 before March 31 of each year, a tax of .01% on the total premiums received for these coverages
4432 during the preceding calendar year from policies covering motor vehicle risks in this state.
4433 (2) The taxable premium under this section shall be reduced by [all] the premiums
4434 returned or credited to policyholders on direct business subject to tax in this state.
4435 (3) [All money] Money received by the state under this section shall be deposited [in
4436 the General Fund as a dedicated credit for the purpose of providing funds] into the Relative
4437 Value Study Restricted Account created in Subsection (4).
4438 (4) (a) There is created in the General Fund a restricted account known as the "Relative
4439 Value Study Restricted Account."
4440 (b) The Relative Value Study Restricted Account shall consist of the money received
4441 by the insurance commissioner under:
4442 (i) Section 31A-2-208 ; and
4443 (ii) this section.
4444 (c) The insurance commissioner shall administer the Relative Value Study Restricted
4445 Account. Subject to appropriations by the Legislature, the insurance commissioner shall use
4446 the money deposited into the Relative Value Study Restricted Account to pay for [any] costs
4447 and expenses incurred by the [Insurance Department] insurance commissioner:
4448 [(a)] (i) in conducting, maintaining, and administering the relative value study referred
4449 to in Section 31A-22-307 ;
4450 [(b)] (ii) to prepare, publish, and distribute publications relating to insurance and
4451 consumers of insurance as provided in Section 31A-2-208 ; and
4452 [(c)] (iii) in providing the services of the [Insurance Department] insurance
4453 commissioner through the use of:

4454 [(i)] (A) electronic commerce; and
4455 [(ii)] (B) other information technology.
4456 Section 54. Section 63I-2-231 is amended to read:
4457 63I-2-231. Repeal dates, Title 31A.
4458 [(1) Section 31A-23a-415 is repealed July 1, 2011.]
4459 [(2)] Title 31A, Chapter 42, Defined Contribution Risk Adjuster Act, is repealed
4460 January 1, 2013.
4461 Section 55. Section 63J-1-602.2 is amended to read:
4462 63J-1-602.2. List of nonlapsing funds and accounts -- Title 31 through Title 45.
4463 (1) Appropriations from the Technology Development Restricted Account created in
4464 Section 31A-3-104 .
4465 (2) Appropriations from the Criminal Background Check Restricted Account created in
4466 Section 31A-3-105 .
4467 (3) Appropriations from the Captive Insurance Restricted Account created in Section
4468 31A-3-304 , except to the extent that Section 31A-3-304 makes the money received under that
4469 section free revenue.
4470 (4) Appropriations from the Title Licensee Enforcement Restricted Account created in
4471 Section 31A-23a-415 .
4472 (5) Appropriations from the Insurance Fraud Investigation Restricted Account created
4473 in Section 31A-31-108 .
4474 [(5)] (6) The fund for operating the state's Federal Health Care Tax Credit Program, as
4475 provided in Section 31A-38-104 .
4476 [(6)] (7) The Special Administrative Expense Account created in Section 35A-4-506 .
4477 [(7)] (8) Funding for a new program or agency that is designated as nonlapsing under
4478 Section 36-24-101 .
4479 [(8)] (9) The Oil and Gas Conservation Account created in Section 40-6-14.5 .
4480 [(9)] (10) The Off-Highway Access and Education Restricted Account created in
4481 Section 41-22-19.5 .

4482 Section 56. Section 63J-1-602.3 is amended to read:
4483 63J-1-602.3. List of nonlapsing funds and accounts -- Title 46 through Title 60.
4484 (1) Certain funds associated with the Law Enforcement Operations Account, as
4485 provided in Section 51-9-411 .
4486 (2) The Public Safety Honoring Heroes Restricted Account created in Section
4487 53-1-118 .
4488 (3) Funding for the Search and Rescue Financial Assistance Program, as provided in
4489 Section 53-2-107 .
4490 (4) Appropriations made to the Department of Public Safety from the Department of
4491 Public Safety Restricted Account, as provided in Section 53-3-106 .
4492 (5) Appropriations to the Motorcycle Rider Education Program, as provided in Section
4493 53-3-905 .
4494 (6) The DNA Specimen Restricted Account created in Section 53-10-407 .
4495 (7) Appropriations to the State Board of Education, as provided in Section
4496 53A-17a-105 .
4497 (8) Certain funds appropriated from the Uniform School Fund to the State Board of
4498 Education for new teacher bonus and performance-based compensation plans, as provided in
4499 Section 53A-17a-148 .
4500 (9) Certain funds appropriated from the Uniform School Fund to the State Board of
4501 Education for implementation of proposals to improve mathematics achievement test scores, as
4502 provided in Section 53A-17a-152 .
4503 (10) The School Building Revolving Account created in Section 53A-21-401 .
4504 (11) Money received by the State Office of Rehabilitation for the sale of certain
4505 products or services, as provided in Section 53A-24-105 .
4506 (12) The State Board of Regents, as provided in Section 53B-6-104 .
4507 (13) Certain funds appropriated from the General Fund to the State Board of Regents
4508 for teacher preparation programs, as provided in Section 53B-6-104 .
4509 (14) A certain portion of money collected for administrative costs under the School

4510 Institutional Trust Lands Management Act, as provided under Section 53C-3-202 .
4511 (15) Certain surcharges on residence and business telecommunications access lines
4512 imposed by the Public Service Commission, as provided in Section 54-8b-10 .
4513 (16) Certain fines collected by the Division of Occupational and Professional Licensing
4514 for violation of unlawful or unprofessional conduct that are used for education and enforcement
4515 purposes, as provided in Section 58-17b-505 .
4516 (17) The Nurse Education and Enforcement Account created in Section 58-31b-103 .
4517 (18) The Certified Nurse Midwife Education and Enforcement Account created in
4518 Section 58-44a-103 .
4519 (19) Certain fines collected by the Division of Occupational and Professional Licensing
4520 for use in education and enforcement of the Security Personnel Licensing Act, as provided in
4521 Section 58-63-103 .
4522 (20) The Professional Geologist Education and Enforcement Account created in
4523 Section 58-76-103 .
4524 (21) Appropriations from the Relative Value Study Restricted Account created in
4525 Section 59-9-105 .
4526 [(21)] (22) Certain money in the Water Resources Conservation and Development
4527 Fund, as provided in Section 59-12-103 .
4528 Section 57. Intent language regarding lapsing of money.
4529 It is the intent of the Legislature that money received by the Insurance Department
4530 during fiscal year 2010-11 under the following shall be considered dedicated credits and in
4531 closing out fiscal year 2010-11 the unspent dedicated credits shall lapse to the appropriate
4532 restricted account created by the amendments made by this bill:
4533 (1) Section 31A-2-208 ;
4534 (2) Section 31A-31-108 ;
4535 (3) Section 31A-31-109 ; and
4536 (4) Section 59-9-105 .
4537 Section 58. Effective date.

4538 This bill takes effect on May 10, 2011, except that the amendments to Section
4539 31A-3-304 in this bill take effect on July 1, 2013.
4540 Section 59. Retrospective operation.
4541 The amendments to the following sections in this bill have retrospective operation to
4542 January 1, 2011:
4543 (1) Section 31A-22-701 ;
4544 (2) Section 31A-30-103 ; and
4545 (3) Section 31A-30-106 .