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H.B. 47 Enrolled

             1     

INSURANCE LAW AMENDMENTS

             2     
2013 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: James A. Dunnigan

             5     
Senate Sponsor: Curtis S. Bramble

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill modifies the Insurance Code.
             10      Highlighted Provisions:
             11          This bill:
             12          .    amends the definition provisions;
             13          .    clarifies the provision related to coordination with other states;
             14          .    addresses rules related to title and escrow examinations;
             15          .    modifies the provision related to the Title and Escrow Commission and its
             16      members;
             17          .    modifies the cap on appropriations from the Captive Insurance Restricted Account,
             18      effective July 1, 2015;
             19          .    enacts provisions related to closing or settlement protections;
             20          .    modifies language regarding restrictions on foreign title insurers;
             21          .    amends provisions related to company action level events;
             22          .    enacts a provision regarding producer's duties related to replacement of life
             23      insurance;
             24          .    addresses death pending conversion of group life insurance policy;
             25          .    modifies preferred provider contract provisions;
             26          .    amends provisions related to health benefit plan offerings;
             27          .    addresses car rental related insurance;
             28          .    amends provisions related to inducements;
             29          .    creates the concept of a "qualifying licensee" for purposes of title and escrow


             30      licenses;
             31          .    clarifies terminology of individual and agency title insurance producers;
             32          .    modifies the requirement that a title insurance producer conduct a minimum
             33      mandatory search to be a requirement of a reasonable search;
             34          .    establishes who shall conduct an escrow as provided in statute;
             35          .    clarifies reference to a title insurance agency's reserve account;
             36          .    addresses Utah mini-COBRA benefits for employer group coverage;
             37          .    addresses sharing of commissions;
             38          .    addresses powers of the board related to the Utah Comprehensive Health Insurance
             39      Pool Act;
             40          .    addresses money deposited into the Insurance Fraud Investigation Restricted
             41      Account and the Insurance Fraud Victim Restitution Account;
             42          .    amends lifetime maximum for covered benefits from the Comprehensive Health
             43      Insurance Pool;
             44          .    creates the Insurance Fraud Victim Restitution Account;
             45          .    repeals provisions related to alternative coverage and Utah NetCare Plan; and
             46          .    makes technical and conforming amendments.
             47      Money Appropriated in this Bill:
             48          None
             49      Other Special Clauses:
             50          This bill has an effective date.
             51      Utah Code Sections Affected:
             52      AMENDS:
             53          31A-1-301, as last amended by Laws of Utah 2012, Chapters 151 and 253
             54          31A-2-201.2, as enacted by Laws of Utah 2010, Chapter 68
             55          31A-2-217, as last amended by Laws of Utah 2008, Chapter 382
             56          31A-2-402, as last amended by Laws of Utah 2011, Chapter 289
             57          31A-2-403, as last amended by Laws of Utah 2010, Chapters 10 and 286


             58          31A-2-404, as last amended by Laws of Utah 2012, Chapter 253
             59          31A-3-304 (Effective 07/01/13), as last amended by Laws of Utah 2011, Chapter 284
             60          31A-8-301, as last amended by Laws of Utah 2005, Chapter 123
             61          31A-14-211, as last amended by Laws of Utah 2011, Chapter 284
             62          31A-17-603, as last amended by Laws of Utah 2001, Chapter 116
             63          31A-19a-209, as last amended by Laws of Utah 2007, Chapter 325
             64          31A-20-110, as last amended by Laws of Utah 2003, Chapter 298
             65          31A-21-503, as last amended by Laws of Utah 2007, Chapter 307
             66          31A-22-519, as enacted by Laws of Utah 1985, Chapter 242
             67          31A-22-612, as last amended by Laws of Utah 2004, Chapter 108
             68          31A-22-617, as last amended by Laws of Utah 2009, Chapter 12
             69          31A-22-618.5, as last amended by Laws of Utah 2011, Chapters 284 and 297
             70          31A-22-722, as last amended by Laws of Utah 2010, Chapter 10
             71          31A-23a-102, as last amended by Laws of Utah 2012, Chapter 253
             72          31A-23a-105, as last amended by Laws of Utah 2012, Chapter 253
             73          31A-23a-106, as last amended by Laws of Utah 2012, Chapters 151 and 253
             74          31A-23a-202, as last amended by Laws of Utah 2011, Chapter 284
             75          31A-23a-203.5, as enacted by Laws of Utah 2011, Chapter 337
             76          31A-23a-204, as last amended by Laws of Utah 2011, Chapters 284 and 342
             77          31A-23a-402, as last amended by Laws of Utah 2011, Second Special Session, Chapter
             78      5
             79          31A-23a-402.5, as last amended by Laws of Utah 2012, Chapters 253 and 279
             80          31A-23a-406, as last amended by Laws of Utah 2012, Chapter 253
             81          31A-23a-407, as renumbered and amended by Laws of Utah 2003, Chapter 298
             82          31A-23a-413, as renumbered and amended by Laws of Utah 2003, Chapter 298
             83          31A-23a-415, as last amended by Laws of Utah 2011, Chapter 284
             84          31A-23a-503, as last amended by Laws of Utah 2005, Chapter 185
             85          31A-23a-504, as last amended by Laws of Utah 2012, Chapter 253


             86          31A-27a-104, as last amended by Laws of Utah 2012, Chapter 253
             87          31A-29-106, as last amended by Laws of Utah 2011, Chapter 284
             88          31A-29-113, as last amended by Laws of Utah 2007, Chapter 40
             89          31A-30-115, as last amended by Laws of Utah 2011, Second Special Session, Chapter 5
             90          31A-30-208, as last amended by Laws of Utah 2011, Chapter 400
             91          31A-31-108, as last amended by Laws of Utah 2012, Chapter 253
             92          31A-41-102, as enacted by Laws of Utah 2008, Chapter 220
             93          31A-41-201, as enacted by Laws of Utah 2008, Chapter 220
             94          31A-41-202, as enacted by Laws of Utah 2008, Chapter 220
             95          49-20-410, as last amended by Laws of Utah 2012, Chapter 406
             96      ENACTS:
             97          31A-4-117, Utah Code Annotated 1953
             98          31A-22-429, Utah Code Annotated 1953
             99          31A-23a-118, Utah Code Annotated 1953
             100          31A-23a-406.5, Utah Code Annotated 1953
             101          31A-31-108.5, Utah Code Annotated 1953
             102      REPEALS:
             103          31A-22-723, as last amended by Laws of Utah 2011, Chapters 284 and 297
             104          31A-22-724, as last amended by Laws of Utah 2011, Chapter 400
             105          31A-30-109, as last amended by Laws of Utah 2012, Chapter 253
             106          31A-30-202.5, as last amended by Laws of Utah 2011, Second Special Session, Chapter
             107      5
             108          31A-30-205, as last amended by Laws of Utah 2011, Chapter 400
             109     
             110      Be it enacted by the Legislature of the state of Utah:
             111          Section 1. Section 31A-1-301 is amended to read:
             112           31A-1-301. Definitions.
             113          As used in this title, unless otherwise specified:


             114          (1) (a) "Accident and health insurance" means insurance to provide protection against
             115      economic losses resulting from:
             116          (i) a medical condition including:
             117          (A) a medical care expense; or
             118          (B) the risk of disability;
             119          (ii) accident; or
             120          (iii) sickness.
             121          (b) "Accident and health insurance":
             122          (i) includes a contract with disability contingencies including:
             123          (A) an income replacement contract;
             124          (B) a health care contract;
             125          (C) an expense reimbursement contract;
             126          (D) a credit accident and health contract;
             127          (E) a continuing care contract; and
             128          (F) a long-term care contract; and
             129          (ii) may provide:
             130          (A) hospital coverage;
             131          (B) surgical coverage;
             132          (C) medical coverage;
             133          (D) loss of income coverage;
             134          (E) prescription drug coverage;
             135          (F) dental coverage; or
             136          (G) vision coverage.
             137          (c) "Accident and health insurance" does not include workers' compensation insurance.
             138          (2) "Actuary" is as defined by the commissioner by rule, made in accordance with Title
             139      63G, Chapter 3, Utah Administrative Rulemaking Act.
             140          (3) "Administrator" is defined in Subsection [(162)] (163).
             141          (4) "Adult" means an individual who has attained the age of at least 18 years.


             142          (5) "Affiliate" means a person who controls, is controlled by, or is under common
             143      control with, another person. A corporation is an affiliate of another corporation, regardless of
             144      ownership, if substantially the same group of individuals manage the corporations.
             145          (6) "Agency" means:
             146          (a) a person other than an individual, including a sole proprietorship by which an
             147      individual does business under an assumed name; and
             148          (b) an insurance organization licensed or required to be licensed under Section
             149      31A-23a-301 , 31A-25-207 , or 31A-26-209 .
             150          (7) "Alien insurer" means an insurer domiciled outside the United States.
             151          (8) "Amendment" means an endorsement to an insurance policy or certificate.
             152          (9) "Annuity" means an agreement to make periodical payments for a period certain or
             153      over the lifetime of one or more individuals if the making or continuance of all or some of the
             154      series of the payments, or the amount of the payment, is dependent upon the continuance of
             155      human life.
             156          (10) "Application" means a document:
             157          (a) (i) completed by an applicant to provide information about the risk to be insured;
             158      and
             159          (ii) that contains information that is used by the insurer to evaluate risk and decide
             160      whether to:
             161          (A) insure the risk under:
             162          (I) the coverage as originally offered; or
             163          (II) a modification of the coverage as originally offered; or
             164          (B) decline to insure the risk; or
             165          (b) used by the insurer to gather information from the applicant before issuance of an
             166      annuity contract.
             167          (11) "Articles" or "articles of incorporation" means:
             168          (a) the original articles;
             169          (b) a special law;


             170          (c) a charter;
             171          (d) an amendment;
             172          (e) restated articles;
             173          (f) articles of merger or consolidation;
             174          (g) a trust instrument;
             175          (h) another constitutive document for a trust or other entity that is not a corporation;
             176      and
             177          (i) an amendment to an item listed in Subsections (11)(a) through (h).
             178          (12) "Bail bond insurance" means a guarantee that a person will attend court when
             179      required, up to and including surrender of the person in execution of a sentence imposed under
             180      Subsection 77-20-7 (1), as a condition to the release of that person from confinement.
             181          (13) "Binder" is defined in Section 31A-21-102 .
             182          (14) "Blanket insurance policy" means a group policy covering a defined class of
             183      persons:
             184          (a) without individual underwriting or application; and
             185          (b) that is determined by definition without designating each person covered.
             186          (15) "Board," "board of trustees," or "board of directors" means the group of persons
             187      with responsibility over, or management of, a corporation, however designated.
             188          (16) "Bona fide office" means a physical office in this state:
             189          (a) that is open to the public;
             190          (b) that is staffed during regular business hours on regular business days; and
             191          (c) at which the public may appear in person to obtain services.
             192          (17) "Business entity" means:
             193          (a) a corporation;
             194          (b) an association;
             195          (c) a partnership;
             196          (d) a limited liability company;
             197          (e) a limited liability partnership; or


             198          (f) another legal entity.
             199          (18) "Business of insurance" is defined in Subsection (88).
             200          (19) "Business plan" means the information required to be supplied to the
             201      commissioner under Subsections 31A-5-204 (2)(i) and (j), including the information required
             202      when these subsections apply by reference under:
             203          (a) Section 31A-7-201 ;
             204          (b) Section 31A-8-205 ; or
             205          (c) Subsection 31A-9-205 (2).
             206          (20) (a) "Bylaws" means the rules adopted for the regulation or management of a
             207      corporation's affairs, however designated.
             208          (b) "Bylaws" includes comparable rules for a trust or other entity that is not a
             209      corporation.
             210          (21) "Captive insurance company" means:
             211          (a) an insurer:
             212          (i) owned by another organization; and
             213          (ii) whose exclusive purpose is to insure risks of the parent organization and an
             214      affiliated company; or
             215          (b) in the case of a group or association, an insurer:
             216          (i) owned by the insureds; and
             217          (ii) whose exclusive purpose is to insure risks of:
             218          (A) a member organization;
             219          (B) a group member; or
             220          (C) an affiliate of:
             221          (I) a member organization; or
             222          (II) a group member.
             223          (22) "Casualty insurance" means liability insurance.
             224          (23) "Certificate" means evidence of insurance given to:
             225          (a) an insured under a group insurance policy; or


             226          (b) a third party.
             227          (24) "Certificate of authority" is included within the term "license."
             228          (25) "Claim," unless the context otherwise requires, means a request or demand on an
             229      insurer for payment of a benefit according to the terms of an insurance policy.
             230          (26) "Claims-made coverage" means an insurance contract or provision limiting
             231      coverage under a policy insuring against legal liability to claims that are first made against the
             232      insured while the policy is in force.
             233          (27) (a) "Commissioner" or "commissioner of insurance" means Utah's insurance
             234      commissioner.
             235          (b) When appropriate, the terms listed in Subsection (27)(a) apply to the equivalent
             236      supervisory official of another jurisdiction.
             237          (28) (a) "Continuing care insurance" means insurance that:
             238          (i) provides board and lodging;
             239          (ii) provides one or more of the following:
             240          (A) a personal service;
             241          (B) a nursing service;
             242          (C) a medical service; or
             243          (D) any other health-related service; and
             244          (iii) provides the coverage described in this Subsection (28)(a) under an agreement
             245      effective:
             246          (A) for the life of the insured; or
             247          (B) for a period in excess of one year.
             248          (b) Insurance is continuing care insurance regardless of whether or not the board and
             249      lodging are provided at the same location as a service described in Subsection (28)(a)(ii).
             250          (29) (a) "Control," "controlling," "controlled," or "under common control" means the
             251      direct or indirect possession of the power to direct or cause the direction of the management
             252      and policies of a person. This control may be:
             253          (i) by contract;


             254          (ii) by common management;
             255          (iii) through the ownership of voting securities; or
             256          (iv) by a means other than those described in Subsections (29)(a)(i) through (iii).
             257          (b) There is no presumption that an individual holding an official position with another
             258      person controls that person solely by reason of the position.
             259          (c) A person having a contract or arrangement giving control is considered to have
             260      control despite the illegality or invalidity of the contract or arrangement.
             261          (d) There is a rebuttable presumption of control in a person who directly or indirectly
             262      owns, controls, holds with the power to vote, or holds proxies to vote 10% or more of the
             263      voting securities of another person.
             264          (30) "Controlled insurer" means a licensed insurer that is either directly or indirectly
             265      controlled by a producer.
             266          (31) "Controlling person" means a person that directly or indirectly has the power to
             267      direct or cause to be directed, the management, control, or activities of a reinsurance
             268      intermediary.
             269          (32) "Controlling producer" means a producer who directly or indirectly controls an
             270      insurer.
             271          (33) (a) "Corporation" means an insurance corporation, except when referring to:
             272          (i) a corporation doing business:
             273          (A) as:
             274          (I) an insurance producer;
             275          (II) a surplus lines producer;
             276          (III) a limited line producer;
             277          (IV) a consultant;
             278          (V) a managing general agent;
             279          (VI) a reinsurance intermediary;
             280          (VII) a third party administrator; or
             281          (VIII) an adjuster; and


             282          (B) under:
             283          (I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
             284      Reinsurance Intermediaries;
             285          (II) Chapter 25, Third Party Administrators; or
             286          (III) Chapter 26, Insurance Adjusters; or
             287          (ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance
             288      Holding Companies.
             289          (b) "Stock corporation" means a stock insurance corporation.
             290          (c) "Mutual" or "mutual corporation" means a mutual insurance corporation.
             291          (34) (a) "Creditable coverage" has the same meaning as provided in federal regulations
             292      adopted pursuant to the Health Insurance Portability and Accountability Act.
             293          (b) "Creditable coverage" includes coverage that is offered through a public health plan
             294      such as:
             295          (i) the Primary Care Network Program under a Medicaid primary care network
             296      demonstration waiver obtained subject to Section 26-18-3 ;
             297          (ii) the Children's Health Insurance Program under Section 26-40-106 ; or
             298          (iii) the Ryan White Program Comprehensive AIDS Resources Emergency Act, Pub. L.
             299      101-381, and Ryan White HIV/AIDS Treatment Modernization Act of 2006, Pub. L. 109-415.
             300          (35) "Credit accident and health insurance" means insurance on a debtor to provide
             301      indemnity for payments coming due on a specific loan or other credit transaction while the
             302      debtor has a disability.
             303          (36) (a) "Credit insurance" means insurance offered in connection with an extension of
             304      credit that is limited to partially or wholly extinguishing that credit obligation.
             305          (b) "Credit insurance" includes:
             306          (i) credit accident and health insurance;
             307          (ii) credit life insurance;
             308          (iii) credit property insurance;
             309          (iv) credit unemployment insurance;


             310          (v) guaranteed automobile protection insurance;
             311          (vi) involuntary unemployment insurance;
             312          (vii) mortgage accident and health insurance;
             313          (viii) mortgage guaranty insurance; and
             314          (ix) mortgage life insurance.
             315          (37) "Credit life insurance" means insurance on the life of a debtor in connection with
             316      an extension of credit that pays a person if the debtor dies.
             317          (38) "Credit property insurance" means insurance:
             318          (a) offered in connection with an extension of credit; and
             319          (b) that protects the property until the debt is paid.
             320          (39) "Credit unemployment insurance" means insurance:
             321          (a) offered in connection with an extension of credit; and
             322          (b) that provides indemnity if the debtor is unemployed for payments coming due on a:
             323          (i) specific loan; or
             324          (ii) credit transaction.
             325          (40) "Creditor" means a person, including an insured, having a claim, whether:
             326          (a) matured;
             327          (b) unmatured;
             328          (c) liquidated;
             329          (d) unliquidated;
             330          (e) secured;
             331          (f) unsecured;
             332          (g) absolute;
             333          (h) fixed; or
             334          (i) contingent.
             335          (41) (a) "Crop insurance" means insurance providing protection against damage to
             336      crops from unfavorable weather conditions, fire or lightning, flood, hail, insect infestation,
             337      disease, or other yield-reducing conditions or perils that is:


             338          (i) provided by the private insurance market; or
             339          (ii) subsidized by the Federal Crop Insurance Corporation.
             340          (b) "Crop insurance" includes multiperil crop insurance.
             341          (42) (a) "Customer service representative" means a person that provides an insurance
             342      service and insurance product information:
             343          (i) for the customer service representative's:
             344          (A) producer;
             345          (B) surplus lines producer; or
             346          (C) consultant employer; and
             347          (ii) to the customer service representative's employer's:
             348          (A) customer;
             349          (B) client; or
             350          (C) organization.
             351          (b) A customer service representative may only operate within the scope of authority of
             352      the customer service representative's producer, surplus lines producer, or consultant employer.
             353          (43) "Deadline" means a final date or time:
             354          (a) imposed by:
             355          (i) statute;
             356          (ii) rule; or
             357          (iii) order; and
             358          (b) by which a required filing or payment must be received by the department.
             359          (44) "Deemer clause" means a provision under this title under which upon the
             360      occurrence of a condition precedent, the commissioner is considered to have taken a specific
             361      action. If the statute so provides, a condition precedent may be the commissioner's failure to
             362      take a specific action.
             363          (45) "Degree of relationship" means the number of steps between two persons
             364      determined by counting the generations separating one person from a common ancestor and
             365      then counting the generations to the other person.


             366          (46) "Department" means the Insurance Department.
             367          (47) "Director" means a member of the board of directors of a corporation.
             368          (48) "Disability" means a physiological or psychological condition that partially or
             369      totally limits an individual's ability to:
             370          (a) perform the duties of:
             371          (i) that individual's occupation; or
             372          (ii) any occupation for which the individual is reasonably suited by education, training,
             373      or experience; or
             374          (b) perform two or more of the following basic activities of daily living:
             375          (i) eating;
             376          (ii) toileting;
             377          (iii) transferring;
             378          (iv) bathing; or
             379          (v) dressing.
             380          (49) "Disability income insurance" is defined in Subsection (79).
             381          (50) "Domestic insurer" means an insurer organized under the laws of this state.
             382          (51) "Domiciliary state" means the state in which an insurer:
             383          (a) is incorporated;
             384          (b) is organized; or
             385          (c) in the case of an alien insurer, enters into the United States.
             386          (52) (a) "Eligible employee" means:
             387          (i) an employee who:
             388          (A) works on a full-time basis; and
             389          (B) has a normal work week of 30 or more hours; or
             390          (ii) a person described in Subsection (52)(b).
             391          (b) "Eligible employee" includes, if the individual is included under a health benefit
             392      plan of a small employer:
             393          (i) a sole proprietor;


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


             422      the requirements of a written agreement between the parties in a real estate transaction; or]
             423          (i) a transaction that effects the sale, transfer, encumbering, or leasing of real property,
             424      when a person not a party to the transaction, and neither having nor acquiring an interest in the
             425      title, performs, in accordance with the written instructions or terms of the written agreement
             426      between the parties to the transaction, any of the following actions:
             427          (A) the explanation, holding, or creation of a document; or
             428          (B) the receipt, deposit, and disbursement of money;
             429          (ii) a settlement or closing involving:
             430          (A) a mobile home;
             431          (B) a grazing right;
             432          (C) a water right; or
             433          (D) other personal property authorized by the commissioner.
             434          [(b) "Escrow" includes the act of conducting a:]
             435          [(i) real estate settlement; or]
             436          [(ii) real estate closing.]
             437          (b) "Escrow" does not include:
             438          (i) the following notarial acts performed by a notary within the state:
             439          (A) an acknowledgment;
             440          (B) a copy certification;
             441          (C) jurat; and
             442          (D) an oath or affirmation;
             443          (ii) the receipt or delivery of a document; or
             444          (iii) the receipt of money for delivery to the escrow agent.
             445          (59) "Escrow agent" means[: (a)] an agency title insurance producer [with:] meeting
             446      the requirements of Sections 31A-4-107 , 31A-14-211 , and 31A-23a-204 , who is acting through
             447      an individual title insurance producer licensed with an escrow subline of authority.
             448          [(i) a title insurance line of authority; and]
             449          [(ii) an escrow subline of authority; or]


             450          [(b) a person defined as an escrow agent in Section 7-22-101 .]
             451          (60) (a) "Excludes" is not exhaustive and does not mean that another thing is not also
             452      excluded.
             453          (b) The items listed in a list using the term "excludes" are representative examples for
             454      use in interpretation of this title.
             455          (61) "Exclusion" means for the purposes of accident and health insurance that an
             456      insurer does not provide insurance coverage, for whatever reason, for one of the following:
             457          (a) a specific physical condition;
             458          (b) a specific medical procedure;
             459          (c) a specific disease or disorder; or
             460          (d) a specific prescription drug or class of prescription drugs.
             461          (62) "Expense reimbursement insurance" means insurance:
             462          (a) written to provide a payment for an expense relating to hospital confinement
             463      resulting from illness or injury; and
             464          (b) written:
             465          (i) as a daily limit for a specific number of days in a hospital; and
             466          (ii) to have a one or two day waiting period following a hospitalization.
             467          (63) "Fidelity insurance" means insurance guaranteeing the fidelity of a person holding
             468      a position of public or private trust.
             469          (64) (a) "Filed" means that a filing is:
             470          (i) submitted to the department as required by and in accordance with applicable
             471      statute, rule, or filing order;
             472          (ii) received by the department within the time period provided in applicable statute,
             473      rule, or filing order; and
             474          (iii) accompanied by the appropriate fee in accordance with:
             475          (A) Section 31A-3-103 ; or
             476          (B) rule.
             477          (b) "Filed" does not include a filing that is rejected by the department because it is not


             478      submitted in accordance with Subsection (64)(a).
             479          (65) "Filing," when used as a noun, means an item required to be filed with the
             480      department including:
             481          (a) a policy;
             482          (b) a rate;
             483          (c) a form;
             484          (d) a document;
             485          (e) a plan;
             486          (f) a manual;
             487          (g) an application;
             488          (h) a report;
             489          (i) a certificate;
             490          (j) an endorsement;
             491          (k) an actuarial certification;
             492          (l) a licensee annual statement;
             493          (m) a licensee renewal application;
             494          (n) an advertisement; or
             495          (o) an outline of coverage.
             496          (66) "First party insurance" means an insurance policy or contract in which the insurer
             497      agrees to pay a claim submitted to it by the insured for the insured's losses.
             498          (67) "Foreign insurer" means an insurer domiciled outside of this state, including an
             499      alien insurer.
             500          (68) (a) "Form" means one of the following prepared for general use:
             501          (i) a policy;
             502          (ii) a certificate;
             503          (iii) an application;
             504          (iv) an outline of coverage; or
             505          (v) an endorsement.


             506          (b) "Form" does not include a document specially prepared for use in an individual
             507      case.
             508          (69) "Franchise insurance" means an individual insurance policy provided through a
             509      mass marketing arrangement involving a defined class of persons related in some way other
             510      than through the purchase of insurance.
             511          (70) "General lines of authority" include:
             512          (a) the general lines of insurance in Subsection (71);
             513          (b) title insurance under one of the following sublines of authority:
             514          (i) search, including authority to act as a title marketing representative;
             515          (ii) escrow, including authority to act as a title marketing representative; and
             516          (iii) title marketing representative only;
             517          (c) surplus lines;
             518          (d) workers' compensation; and
             519          (e) any other line of insurance that the commissioner considers necessary to recognize
             520      in the public interest.
             521          (71) "General lines of insurance" include:
             522          (a) accident and health;
             523          (b) casualty;
             524          (c) life;
             525          (d) personal lines;
             526          (e) property; and
             527          (f) variable contracts, including variable life and annuity.
             528          (72) "Group health plan" means an employee welfare benefit plan to the extent that the
             529      plan provides medical care:
             530          (a) (i) to an employee; or
             531          (ii) to a dependent of an employee; and
             532          (b) (i) directly;
             533          (ii) through insurance reimbursement; or


             534          (iii) through another method.
             535          (73) (a) "Group insurance policy" means a policy covering a group of persons that is
             536      issued:
             537          (i) to a policyholder on behalf of the group; and
             538          (ii) for the benefit of a member of the group who is selected under a procedure defined
             539      in:
             540          (A) the policy; or
             541          (B) an agreement that is collateral to the policy.
             542          (b) A group insurance policy may include a member of the policyholder's family or a
             543      dependent.
             544          (74) "Guaranteed automobile protection insurance" means insurance offered in
             545      connection with an extension of credit that pays the difference in amount between the
             546      insurance settlement and the balance of the loan if the insured automobile is a total loss.
             547          (75) (a) Except as provided in Subsection (75)(b), "health benefit plan" means a policy
             548      or certificate that:
             549          (i) provides health care insurance;
             550          (ii) provides major medical expense insurance; or
             551          (iii) is offered as a substitute for hospital or medical expense insurance, such as:
             552          (A) a hospital confinement indemnity; or
             553          (B) a limited benefit plan.
             554          (b) "Health benefit plan" does not include a policy or certificate that:
             555          (i) provides benefits solely for:
             556          (A) accident;
             557          (B) dental;
             558          (C) income replacement;
             559          (D) long-term care;
             560          (E) a Medicare supplement;
             561          (F) a specified disease;


             562          (G) vision; or
             563          (H) a short-term limited duration; or
             564          (ii) is offered and marketed as supplemental health insurance.
             565          (76) "Health care" means any of the following intended for use in the diagnosis,
             566      treatment, mitigation, or prevention of a human ailment or impairment:
             567          (a) a professional service;
             568          (b) a personal service;
             569          (c) a facility;
             570          (d) equipment;
             571          (e) a device;
             572          (f) supplies; or
             573          (g) medicine.
             574          (77) (a) "Health care insurance" or "health insurance" means insurance providing:
             575          (i) a health care benefit; or
             576          (ii) payment of an incurred health care expense.
             577          (b) "Health care insurance" or "health insurance" does not include accident and health
             578      insurance providing a benefit for:
             579          (i) replacement of income;
             580          (ii) short-term accident;
             581          (iii) fixed indemnity;
             582          (iv) credit accident and health;
             583          (v) supplements to liability;
             584          (vi) workers' compensation;
             585          (vii) automobile medical payment;
             586          (viii) no-fault automobile;
             587          (ix) equivalent self-insurance; or
             588          (x) a type of accident and health insurance coverage that is a part of or attached to
             589      another type of policy.


             590          (78) "Health Insurance Portability and Accountability Act" means the Health Insurance
             591      Portability and Accountability Act of 1996, Pub. L. 104-191, 110 Stat. 1936, as amended.
             592          (79) "Income replacement insurance" or "disability income insurance" means insurance
             593      written to provide payments to replace income lost from accident or sickness.
             594          (80) "Indemnity" means the payment of an amount to offset all or part of an insured
             595      loss.
             596          (81) "Independent adjuster" means an insurance adjuster required to be licensed under
             597      Section 31A-26-201 who engages in insurance adjusting as a representative of an insurer.
             598          (82) "Independently procured insurance" means insurance procured under Section
             599      31A-15-104 .
             600          (83) "Individual" means a natural person.
             601          (84) "Inland marine insurance" includes insurance covering:
             602          (a) property in transit on or over land;
             603          (b) property in transit over water by means other than boat or ship;
             604          (c) bailee liability;
             605          (d) fixed transportation property such as bridges, electric transmission systems, radio
             606      and television transmission towers and tunnels; and
             607          (e) personal and commercial property floaters.
             608          (85) "Insolvency" means that:
             609          (a) an insurer is unable to pay its debts or meet its obligations as the debts and
             610      obligations mature;
             611          (b) an insurer's total adjusted capital is less than the insurer's mandatory control level
             612      RBC under Subsection 31A-17-601 (8)(c); or
             613          (c) an insurer is determined to be hazardous under this title.
             614          (86) (a) "Insurance" means:
             615          (i) an arrangement, contract, or plan for the transfer of a risk or risks from one or more
             616      persons to one or more other persons; or
             617          (ii) an arrangement, contract, or plan for the distribution of a risk or risks among a


             618      group of persons that includes the person seeking to distribute that person's risk.
             619          (b) "Insurance" includes:
             620          (i) a risk distributing arrangement providing for compensation or replacement for
             621      damages or loss through the provision of a service or a benefit in kind;
             622          (ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a
             623      business and not as merely incidental to a business transaction; and
             624          (iii) a plan in which the risk does not rest upon the person who makes an arrangement,
             625      but with a class of persons who have agreed to share the risk.
             626          (87) "Insurance adjuster" means a person who directs the investigation, negotiation, or
             627      settlement of a claim under an insurance policy other than life insurance or an annuity, on
             628      behalf of an insurer, policyholder, or a claimant under an insurance policy.
             629          (88) "Insurance business" or "business of insurance" includes:
             630          (a) providing health care insurance by an organization that is or is required to be
             631      licensed under this title;
             632          (b) providing a benefit to an employee in the event of a contingency not within the
             633      control of the employee, in which the employee is entitled to the benefit as a right, which
             634      benefit may be provided either:
             635          (i) by a single employer or by multiple employer groups; or
             636          (ii) through one or more trusts, associations, or other entities;
             637          (c) providing an annuity:
             638          (i) including an annuity issued in return for a gift; and
             639          (ii) except an annuity provided by a person specified in Subsections 31A-22-1305 (2)
             640      and (3);
             641          (d) providing the characteristic services of a motor club as outlined in Subsection
             642      (116);
             643          (e) providing another person with insurance;
             644          (f) making as insurer, guarantor, or surety, or proposing to make as insurer, guarantor,
             645      or surety, a contract or policy of title insurance;


             646          (g) transacting or proposing to transact any phase of title insurance, including:
             647          (i) solicitation;
             648          (ii) negotiation preliminary to execution;
             649          (iii) execution of a contract of title insurance;
             650          (iv) insuring; and
             651          (v) transacting matters subsequent to the execution of the contract and arising out of
             652      the contract, including reinsurance;
             653          (h) transacting or proposing a life settlement; and
             654          (i) doing, or proposing to do, any business in substance equivalent to Subsections
             655      (88)(a) through (h) in a manner designed to evade this title.
             656          (89) "Insurance consultant" or "consultant" means a person who:
             657          (a) advises another person about insurance needs and coverages;
             658          (b) is compensated by the person advised on a basis not directly related to the insurance
             659      placed; and
             660          (c) except as provided in Section 31A-23a-501 , is not compensated directly or
             661      indirectly by an insurer or producer for advice given.
             662          (90) "Insurance holding company system" means a group of two or more affiliated
             663      persons, at least one of whom is an insurer.
             664          (91) (a) "Insurance producer" or "producer" means a person licensed or required to be
             665      licensed under the laws of this state to sell, solicit, or negotiate insurance.
             666          (b) (i) "Producer for the insurer" means a producer who is compensated directly or
             667      indirectly by an insurer for selling, soliciting, or negotiating an insurance product of that
             668      insurer.
             669          (ii) "Producer for the insurer" may be referred to as an "agent."
             670          (c) (i) "Producer for the insured" means a producer who:
             671          (A) is compensated directly and only by an insurance customer or an insured; and
             672          (B) receives no compensation directly or indirectly from an insurer for selling,
             673      soliciting, or negotiating an insurance product of that insurer to an insurance customer or


             674      insured.
             675          (ii) "Producer for the insured" may be referred to as a "broker."
             676          (92) (a) "Insured" means a person to whom or for whose benefit an insurer makes a
             677      promise in an insurance policy and includes:
             678          (i) a policyholder;
             679          (ii) a subscriber;
             680          (iii) a member; and
             681          (iv) a beneficiary.
             682          (b) The definition in Subsection (92)(a):
             683          (i) applies only to this title; and
             684          (ii) does not define the meaning of this word as used in an insurance policy or
             685      certificate.
             686          (93) (a) "Insurer" means a person doing an insurance business as a principal including:
             687          (i) a fraternal benefit society;
             688          (ii) an issuer of a gift annuity other than an annuity specified in Subsections
             689      31A-22-1305 (2) and (3);
             690          (iii) a motor club;
             691          (iv) an employee welfare plan; and
             692          (v) a person purporting or intending to do an insurance business as a principal on that
             693      person's own account.
             694          (b) "Insurer" does not include a governmental entity to the extent the governmental
             695      entity is engaged in an activity described in Section 31A-12-107 .
             696          (94) "Interinsurance exchange" is defined in Subsection [(145)] (146).
             697          (95) "Involuntary unemployment insurance" means insurance:
             698          (a) offered in connection with an extension of credit; and
             699          (b) that provides indemnity if the debtor is involuntarily unemployed for payments
             700      coming due on a:
             701          (i) specific loan; or


             702          (ii) credit transaction.
             703          (96) "Large employer," in connection with a health benefit plan, means an employer
             704      who, with respect to a calendar year and to a plan year:
             705          (a) employed an average of at least 51 eligible employees on each business day during
             706      the preceding calendar year; and
             707          (b) employs at least two employees on the first day of the plan year.
             708          (97) "Late enrollee," with respect to an employer health benefit plan, means an
             709      individual whose enrollment is a late enrollment.
             710          (98) "Late enrollment," with respect to an employer health benefit plan, means
             711      enrollment of an individual other than:
             712          (a) on the earliest date on which coverage can become effective for the individual
             713      under the terms of the plan; or
             714          (b) through special enrollment.
             715          (99) (a) Except for a retainer contract or legal assistance described in Section
             716      31A-1-103 , "legal expense insurance" means insurance written to indemnify or pay for a
             717      specified legal expense.
             718          (b) "Legal expense insurance" includes an arrangement that creates a reasonable
             719      expectation of an enforceable right.
             720          (c) "Legal expense insurance" does not include the provision of, or reimbursement for,
             721      legal services incidental to other insurance coverage.
             722          (100) (a) "Liability insurance" means insurance against liability:
             723          (i) for death, injury, or disability of a human being, or for damage to property,
             724      exclusive of the coverages under:
             725          (A) Subsection (110) for medical malpractice insurance;
             726          (B) Subsection [(137)] (138) for professional liability insurance; and
             727          (C) Subsection [(171)] (172) for workers' compensation insurance;
             728          (ii) for a medical, hospital, surgical, and funeral benefit to a person other than the
             729      insured who is injured, irrespective of legal liability of the insured, when issued with or


             730      supplemental to insurance against legal liability for the death, injury, or disability of a human
             731      being, exclusive of the coverages under:
             732          (A) Subsection (110) for medical malpractice insurance;
             733          (B) Subsection [(137)] (138) for professional liability insurance; and
             734          (C) Subsection [(171)] (172) for workers' compensation insurance;
             735          (iii) for loss or damage to property resulting from an accident to or explosion of a
             736      boiler, pipe, pressure container, machinery, or apparatus;
             737          (iv) for loss or damage to property caused by:
             738          (A) the breakage or leakage of a sprinkler, water pipe, or water container; or
             739          (B) water entering through a leak or opening in a building; or
             740          (v) for other loss or damage properly the subject of insurance not within another kind
             741      of insurance as defined in this chapter, if the insurance is not contrary to law or public policy.
             742          (b) "Liability insurance" includes:
             743          (i) vehicle liability insurance;
             744          (ii) residential dwelling liability insurance; and
             745          (iii) making inspection of, and issuing a certificate of inspection upon, an elevator,
             746      boiler, machinery, or apparatus of any kind when done in connection with insurance on the
             747      elevator, boiler, machinery, or apparatus.
             748          (101) (a) "License" means authorization issued by the commissioner to engage in an
             749      activity that is part of or related to the insurance business.
             750          (b) "License" includes a certificate of authority issued to an insurer.
             751          (102) (a) "Life insurance" means:
             752          (i) insurance on a human life; and
             753          (ii) insurance pertaining to or connected with human life.
             754          (b) The business of life insurance includes:
             755          (i) granting a death benefit;
             756          (ii) granting an annuity benefit;
             757          (iii) granting an endowment benefit;


             758          (iv) granting an additional benefit in the event of death by accident;
             759          (v) granting an additional benefit to safeguard the policy against lapse; and
             760          (vi) providing an optional method of settlement of proceeds.
             761          (103) "Limited license" means a license that:
             762          (a) is issued for a specific product of insurance; and
             763          (b) limits an individual or agency to transact only for that product or insurance.
             764          (104) "Limited line credit insurance" includes the following forms of insurance:
             765          (a) credit life;
             766          (b) credit accident and health;
             767          (c) credit property;
             768          (d) credit unemployment;
             769          (e) involuntary unemployment;
             770          (f) mortgage life;
             771          (g) mortgage guaranty;
             772          (h) mortgage accident and health;
             773          (i) guaranteed automobile protection; and
             774          (j) another form of insurance offered in connection with an extension of credit that:
             775          (i) is limited to partially or wholly extinguishing the credit obligation; and
             776          (ii) the commissioner determines by rule should be designated as a form of limited line
             777      credit insurance.
             778          (105) "Limited line credit insurance producer" means a person who sells, solicits, or
             779      negotiates one or more forms of limited line credit insurance coverage to an individual through
             780      a master, corporate, group, or individual policy.
             781          (106) "Limited line insurance" includes:
             782          (a) bail bond;
             783          (b) limited line credit insurance;
             784          (c) legal expense insurance;
             785          (d) motor club insurance;


             786          (e) car rental related insurance;
             787          (f) travel insurance;
             788          (g) crop insurance;
             789          (h) self-service storage insurance;
             790          (i) guaranteed asset protection waiver;
             791          (j) portable electronics insurance; and
             792          (k) another form of limited insurance that the commissioner determines by rule should
             793      be designated a form of limited line insurance.
             794          (107) "Limited lines authority" includes:
             795          (a) the lines of insurance listed in Subsection (106); and
             796          (b) a customer service representative.
             797          (108) "Limited lines producer" means a person who sells, solicits, or negotiates limited
             798      lines insurance.
             799          (109) (a) "Long-term care insurance" means an insurance policy or rider advertised,
             800      marketed, offered, or designated to provide coverage:
             801          (i) in a setting other than an acute care unit of a hospital;
             802          (ii) for not less than 12 consecutive months for a covered person on the basis of:
             803          (A) expenses incurred;
             804          (B) indemnity;
             805          (C) prepayment; or
             806          (D) another method;
             807          (iii) for one or more necessary or medically necessary services that are:
             808          (A) diagnostic;
             809          (B) preventative;
             810          (C) therapeutic;
             811          (D) rehabilitative;
             812          (E) maintenance; or
             813          (F) personal care; and


             814          (iv) that may be issued by:
             815          (A) an insurer;
             816          (B) a fraternal benefit society;
             817          (C) (I) a nonprofit health hospital; and
             818          (II) a medical service corporation;
             819          (D) a prepaid health plan;
             820          (E) a health maintenance organization; or
             821          (F) an entity similar to the entities described in Subsections (109)(a)(iv)(A) through (E)
             822      to the extent that the entity is otherwise authorized to issue life or health care insurance.
             823          (b) "Long-term care insurance" includes:
             824          (i) any of the following that provide directly or supplement long-term care insurance:
             825          (A) a group or individual annuity or rider; or
             826          (B) a life insurance policy or rider;
             827          (ii) a policy or rider that provides for payment of benefits on the basis of:
             828          (A) cognitive impairment; or
             829          (B) functional capacity; or
             830          (iii) a qualified long-term care insurance contract.
             831          (c) "Long-term care insurance" does not include:
             832          (i) a policy that is offered primarily to provide basic Medicare supplement coverage;
             833          (ii) basic hospital expense coverage;
             834          (iii) basic medical/surgical expense coverage;
             835          (iv) hospital confinement indemnity coverage;
             836          (v) major medical expense coverage;
             837          (vi) income replacement or related asset-protection coverage;
             838          (vii) accident only coverage;
             839          (viii) coverage for a specified:
             840          (A) disease; or
             841          (B) accident;


             842          (ix) limited benefit health coverage; or
             843          (x) a life insurance policy that accelerates the death benefit to provide the option of a
             844      lump sum payment:
             845          (A) if the following are not conditioned on the receipt of long-term care:
             846          (I) benefits; or
             847          (II) eligibility; and
             848          (B) the coverage is for one or more the following qualifying events:
             849          (I) terminal illness;
             850          (II) medical conditions requiring extraordinary medical intervention; or
             851          (III) permanent institutional confinement.
             852          (110) "Medical malpractice insurance" means insurance against legal liability incident
             853      to the practice and provision of a medical service other than the practice and provision of a
             854      dental service.
             855          (111) "Member" means a person having membership rights in an insurance
             856      corporation.
             857          (112) "Minimum capital" or "minimum required capital" means the capital that must be
             858      constantly maintained by a stock insurance corporation as required by statute.
             859          (113) "Mortgage accident and health insurance" means insurance offered in connection
             860      with an extension of credit that provides indemnity for payments coming due on a mortgage
             861      while the debtor has a disability.
             862          (114) "Mortgage guaranty insurance" means surety insurance under which a mortgagee
             863      or other creditor is indemnified against losses caused by the default of a debtor.
             864          (115) "Mortgage life insurance" means insurance on the life of a debtor in connection
             865      with an extension of credit that pays if the debtor dies.
             866          (116) "Motor club" means a person:
             867          (a) licensed under:
             868          (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
             869          (ii) Chapter 11, Motor Clubs; or


             870          (iii) Chapter 14, Foreign Insurers; and
             871          (b) that promises for an advance consideration to provide for a stated period of time
             872      one or more:
             873          (i) legal services under Subsection 31A-11-102 (1)(b);
             874          (ii) bail services under Subsection 31A-11-102 (1)(c); or
             875          (iii) (A) trip reimbursement;
             876          (B) towing services;
             877          (C) emergency road services;
             878          (D) stolen automobile services;
             879          (E) a combination of the services listed in Subsections (116)(b)(iii)(A) through (D); or
             880          (F) other services given in Subsections 31A-11-102 (1)(b) through (f).
             881          (117) "Mutual" means a mutual insurance corporation.
             882          (118) "Network plan" means health care insurance:
             883          (a) that is issued by an insurer; and
             884          (b) under which the financing and delivery of medical care is provided, in whole or in
             885      part, through a defined set of providers under contract with the insurer, including the financing
             886      and delivery of an item paid for as medical care.
             887          (119) "Nonparticipating" means a plan of insurance under which the insured is not
             888      entitled to receive a dividend representing a share of the surplus of the insurer.
             889          (120) "Ocean marine insurance" means insurance against loss of or damage to:
             890          (a) ships or hulls of ships;
             891          (b) goods, freight, cargoes, merchandise, effects, disbursements, profits, money,
             892      securities, choses in action, evidences of debt, valuable papers, bottomry, respondentia
             893      interests, or other cargoes in or awaiting transit over the oceans or inland waterways;
             894          (c) earnings such as freight, passage money, commissions, or profits derived from
             895      transporting goods or people upon or across the oceans or inland waterways; or
             896          (d) a vessel owner or operator as a result of liability to employees, passengers, bailors,
             897      owners of other vessels, owners of fixed objects, customs or other authorities, or other persons


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


             926          (a) an individual; or
             927          (b) a family.
             928          (127) "Plan sponsor" is as defined in 29 U.S.C. Sec. 1002(16)(B).
             929          (128) "Plan year" means:
             930          (a) the year that is designated as the plan year in:
             931          (i) the plan document of a group health plan; or
             932          (ii) a summary plan description of a group health plan;
             933          (b) if the plan document or summary plan description does not designate a plan year or
             934      there is no plan document or summary plan description:
             935          (i) the year used to determine deductibles or limits;
             936          (ii) the policy year, if the plan does not impose deductibles or limits on a yearly basis;
             937      or
             938          (iii) the employer's taxable year if:
             939          (A) the plan does not impose deductibles or limits on a yearly basis; and
             940          (B) (I) the plan is not insured; or
             941          (II) the insurance policy is not renewed on an annual basis; or
             942          (c) in a case not described in Subsection (128)(a) or (b), the calendar year.
             943          (129) (a) "Policy" means a document, including an attached endorsement or application
             944      that:
             945          (i) purports to be an enforceable contract; and
             946          (ii) memorializes in writing some or all of the terms of an insurance contract.
             947          (b) "Policy" includes a service contract issued by:
             948          (i) a motor club under Chapter 11, Motor Clubs;
             949          (ii) a service contract provided under Chapter 6a, Service Contracts; and
             950          (iii) a corporation licensed under:
             951          (A) Chapter 7, Nonprofit Health Service Insurance Corporations; or
             952          (B) Chapter 8, Health Maintenance Organizations and Limited Health Plans.
             953          (c) "Policy" does not include:


             954          (i) a certificate under a group insurance contract; or
             955          (ii) a document that does not purport to have legal effect.
             956          (130) "Policyholder" means a person who controls a policy, binder, or oral contract by
             957      ownership, premium payment, or otherwise.
             958          (131) "Policy illustration" means a presentation or depiction that includes
             959      nonguaranteed elements of a policy of life insurance over a period of years.
             960          (132) "Policy summary" means a synopsis describing the elements of a life insurance
             961      policy.
             962          (133) "PPACA" means the Patient Protection and Affordable Care Act, Pub. L. No.
             963      111-148 and the Health Care Education Reconciliation Act of 2010, Pub. L. No. 111-152, and
             964      related federal regulations and guidance.
             965          [(133)] (134) "Preexisting condition," with respect to a health benefit plan:
             966          (a) means a condition that was present before the effective date of coverage, whether or
             967      not medical advice, diagnosis, care, or treatment was recommended or received before that day;
             968      and
             969          (b) does not include a condition indicated by genetic information unless an actual
             970      diagnosis of the condition by a physician has been made.
             971          [(134)] (135) (a) "Premium" means the monetary consideration for an insurance policy.
             972          (b) "Premium" includes, however designated:
             973          (i) an assessment;
             974          (ii) a membership fee;
             975          (iii) a required contribution; or
             976          (iv) monetary consideration.
             977          (c) (i) "Premium" does not include consideration paid to a third party administrator for
             978      the third party administrator's services.
             979          (ii) "Premium" includes an amount paid by a third party administrator to an insurer for
             980      insurance on the risks administered by the third party administrator.
             981          [(135)] (136) "Principal officers" for a corporation means the officers designated under


             982      Subsection 31A-5-203 (3).
             983          [(136)] (137) "Proceeding" includes an action or special statutory proceeding.
             984          [(137)] (138) "Professional liability insurance" means insurance against legal liability
             985      incident to the practice of a profession and provision of a professional service.
             986          [(138)] (139) (a) Except as provided in Subsection [(138)] (139)(b), "property
             987      insurance" means insurance against loss or damage to real or personal property of every kind
             988      and any interest in that property:
             989          (i) from all hazards or causes; and
             990          (ii) against loss consequential upon the loss or damage including vehicle
             991      comprehensive and vehicle physical damage coverages.
             992          (b) "Property insurance" does not include:
             993          (i) inland marine insurance; and
             994          (ii) ocean marine insurance.
             995          [(139)] (140) "Qualified long-term care insurance contract" or "federally tax qualified
             996      long-term care insurance contract" means:
             997          (a) an individual or group insurance contract that meets the requirements of Section
             998      7702B(b), Internal Revenue Code; or
             999          (b) the portion of a life insurance contract that provides long-term care insurance:
             1000          (i) (A) by rider; or
             1001          (B) as a part of the contract; and
             1002          (ii) that satisfies the requirements of Sections 7702B(b) and (e), Internal Revenue
             1003      Code.
             1004          [(140)] (141) "Qualified United States financial institution" means an institution that:
             1005          (a) is:
             1006          (i) organized under the laws of the United States or any state; or
             1007          (ii) in the case of a United States office of a foreign banking organization, licensed
             1008      under the laws of the United States or any state;
             1009          (b) is regulated, supervised, and examined by a United States federal or state authority


             1010      having regulatory authority over a bank or trust company; and
             1011          (c) meets the standards of financial condition and standing that are considered
             1012      necessary and appropriate to regulate the quality of a financial institution whose letters of credit
             1013      will be acceptable to the commissioner as determined by:
             1014          (i) the commissioner by rule; or
             1015          (ii) the Securities Valuation Office of the National Association of Insurance
             1016      Commissioners.
             1017          [(141)] (142) (a) "Rate" means:
             1018          (i) the cost of a given unit of insurance; or
             1019          (ii) for property or casualty insurance, that cost of insurance per exposure unit either
             1020      expressed as:
             1021          (A) a single number; or
             1022          (B) a pure premium rate, adjusted before the application of individual risk variations
             1023      based on loss or expense considerations to account for the treatment of:
             1024          (I) expenses;
             1025          (II) profit; and
             1026          (III) individual insurer variation in loss experience.
             1027          (b) "Rate" does not include a minimum premium.
             1028          [(142)] (143) (a) Except as provided in Subsection [(142)] (143)(b), "rate service
             1029      organization" means a person who assists an insurer in rate making or filing by:
             1030          (i) collecting, compiling, and furnishing loss or expense statistics;
             1031          (ii) recommending, making, or filing rates or supplementary rate information; or
             1032          (iii) advising about rate questions, except as an attorney giving legal advice.
             1033          (b) "Rate service organization" does not mean:
             1034          (i) an employee of an insurer;
             1035          (ii) a single insurer or group of insurers under common control;
             1036          (iii) a joint underwriting group; or
             1037          (iv) an individual serving as an actuarial or legal consultant.


             1038          [(143)] (144) "Rating manual" means any of the following used to determine initial and
             1039      renewal policy premiums:
             1040          (a) a manual of rates;
             1041          (b) a classification;
             1042          (c) a rate-related underwriting rule; and
             1043          (d) a rating formula that describes steps, policies, and procedures for determining
             1044      initial and renewal policy premiums.
             1045          [(144)] (145) "Received by the department" means:
             1046          (a) the date delivered to and stamped received by the department, if delivered in
             1047      person;
             1048          (b) the post mark date, if delivered by mail;
             1049          (c) the delivery service's post mark or pickup date, if delivered by a delivery service;
             1050          (d) the received date recorded on an item delivered, if delivered by:
             1051          (i) facsimile;
             1052          (ii) email; or
             1053          (iii) another electronic method; or
             1054          (e) a date specified in:
             1055          (i) a statute;
             1056          (ii) a rule; or
             1057          (iii) an order.
             1058          [(145)] (146) "Reciprocal" or "interinsurance exchange" means an unincorporated
             1059      association of persons:
             1060          (a) operating through an attorney-in-fact common to all of the persons; and
             1061          (b) exchanging insurance contracts with one another that provide insurance coverage
             1062      on each other.
             1063          [(146)] (147) "Reinsurance" means an insurance transaction where an insurer, for
             1064      consideration, transfers any portion of the risk it has assumed to another insurer. In referring to
             1065      reinsurance transactions, this title sometimes refers to:


             1066          (a) the insurer transferring the risk as the "ceding insurer"; and
             1067          (b) the insurer assuming the risk as the:
             1068          (i) "assuming insurer"; or
             1069          (ii) "assuming reinsurer."
             1070          [(147)] (148) "Reinsurer" means a person licensed in this state as an insurer with the
             1071      authority to assume reinsurance.
             1072          [(148)] (149) "Residential dwelling liability insurance" means insurance against
             1073      liability resulting from or incident to the ownership, maintenance, or use of a residential
             1074      dwelling that is a detached single family residence or multifamily residence up to four units.
             1075          [(149)] (150) (a) "Retrocession" means reinsurance with another insurer of a liability
             1076      assumed under a reinsurance contract.
             1077          (b) A reinsurer "retrocedes" when the reinsurer reinsures with another insurer part of a
             1078      liability assumed under a reinsurance contract.
             1079          [(150)] (151) "Rider" means an endorsement to:
             1080          (a) an insurance policy; or
             1081          (b) an insurance certificate.
             1082          [(151)] (152) (a) "Security" means a:
             1083          (i) note;
             1084          (ii) stock;
             1085          (iii) bond;
             1086          (iv) debenture;
             1087          (v) evidence of indebtedness;
             1088          (vi) certificate of interest or participation in a profit-sharing agreement;
             1089          (vii) collateral-trust certificate;
             1090          (viii) preorganization certificate or subscription;
             1091          (ix) transferable share;
             1092          (x) investment contract;
             1093          (xi) voting trust certificate;


             1094          (xii) certificate of deposit for a security;
             1095          (xiii) certificate of interest of participation in an oil, gas, or mining title or lease or in
             1096      payments out of production under such a title or lease;
             1097          (xiv) commodity contract or commodity option;
             1098          (xv) certificate of interest or participation in, temporary or interim certificate for,
             1099      receipt for, guarantee of, or warrant or right to subscribe to or purchase any of the items listed
             1100      in Subsections [(151)] (152)(a)(i) through (xiv); or
             1101          (xvi) another interest or instrument commonly known as a security.
             1102          (b) "Security" does not include:
             1103          (i) any of the following under which an insurance company promises to pay money in a
             1104      specific lump sum or periodically for life or some other specified period:
             1105          (A) insurance;
             1106          (B) an endowment policy; or
             1107          (C) an annuity contract; or
             1108          (ii) a burial certificate or burial contract.
             1109          [(152)] (153) "Secondary medical condition" means a complication related to an
             1110      exclusion from coverage in accident and health insurance.
             1111          [(153)] (154) (a) "Self-insurance" means an arrangement under which a person
             1112      provides for spreading its own risks by a systematic plan.
             1113          (b) Except as provided in this Subsection [(153)] (154), "self-insurance" does not
             1114      include an arrangement under which a number of persons spread their risks among themselves.
             1115          (c) "Self-insurance" includes:
             1116          (i) an arrangement by which a governmental entity undertakes to indemnify an
             1117      employee for liability arising out of the employee's employment; and
             1118          (ii) an arrangement by which a person with a managed program of self-insurance and
             1119      risk management undertakes to indemnify its affiliates, subsidiaries, directors, officers, or
             1120      employees for liability or risk that is related to the relationship or employment.
             1121          (d) "Self-insurance" does not include an arrangement with an independent contractor.


             1122          [(154)] (155) "Sell" means to exchange a contract of insurance:
             1123          (a) by any means;
             1124          (b) for money or its equivalent; and
             1125          (c) on behalf of an insurance company.
             1126          [(155)] (156) "Short-term care insurance" means an insurance policy or rider
             1127      advertised, marketed, offered, or designed to provide coverage that is similar to long-term care
             1128      insurance, but that provides coverage for less than 12 consecutive months for each covered
             1129      person.
             1130          [(156)] (157) "Significant break in coverage" means a period of 63 consecutive days
             1131      during each of which an individual does not have creditable coverage.
             1132          [(157)] (158) "Small employer," in connection with a health benefit plan, means an
             1133      employer who, with respect to a calendar year and to a plan year:
             1134          (a) employed an average of at least two employees but not more than 50 eligible
             1135      employees on each business day during the preceding calendar year; and
             1136          (b) employs at least two employees on the first day of the plan year.
             1137          [(158)] (159) "Special enrollment period," in connection with a health benefit plan, has
             1138      the same meaning as provided in federal regulations adopted pursuant to the Health Insurance
             1139      Portability and Accountability Act.
             1140          [(159)] (160) (a) "Subsidiary" of a person means an affiliate controlled by that person
             1141      either directly or indirectly through one or more affiliates or intermediaries.
             1142          (b) "Wholly owned subsidiary" of a person is a subsidiary of which all of the voting
             1143      shares are owned by that person either alone or with its affiliates, except for the minimum
             1144      number of shares the law of the subsidiary's domicile requires to be owned by directors or
             1145      others.
             1146          [(160)] (161) Subject to Subsection (86)(b), "surety insurance" includes:
             1147          (a) a guarantee against loss or damage resulting from the failure of a principal to pay or
             1148      perform the principal's obligations to a creditor or other obligee;
             1149          (b) bail bond insurance; and


             1150          (c) fidelity insurance.
             1151          [(161)] (162) (a) "Surplus" means the excess of assets over the sum of paid-in capital
             1152      and liabilities.
             1153          (b) (i) "Permanent surplus" means the surplus of [a mutual] an insurer or organization
             1154      that is designated by the insurer or organization as permanent.
             1155          (ii) Sections 31A-5-211 , 31A-7-201 , 31A-8-209 , 31A-9-209 , and [ 31A-14-209 ]
             1156      31A-14-205 require that [mutuals] insurers or organizations doing business in this state
             1157      maintain specified minimum levels of permanent surplus.
             1158          (iii) Except for assessable mutuals, the minimum permanent surplus requirement is the
             1159      same as the minimum required capital requirement that applies to stock insurers.
             1160          (c) "Excess surplus" means:
             1161          (i) for a life insurer, accident and health insurer, health organization, or property and
             1162      casualty insurer as defined in Section 31A-17-601 , the lesser of:
             1163          (A) that amount of an insurer's or health organization's total adjusted capital that
             1164      exceeds the product of:
             1165          (I) 2.5; and
             1166          (II) the sum of the insurer's or health organization's minimum capital or permanent
             1167      surplus required under Section 31A-5-211 , 31A-9-209 , or 31A-14-205 ; or
             1168          (B) that amount of an insurer's or health organization's total adjusted capital that
             1169      exceeds the product of:
             1170          (I) 3.0; and
             1171          (II) the authorized control level RBC as defined in Subsection 31A-17-601 (8)(a); and
             1172          (ii) for a monoline mortgage guaranty insurer, financial guaranty insurer, or title insurer
             1173      that amount of an insurer's paid-in-capital and surplus that exceeds the product of:
             1174          (A) 1.5; and
             1175          (B) the insurer's total adjusted capital required by Subsection 31A-17-609 (1).
             1176          [(162)] (163) "Third party administrator" or "administrator" means a person who
             1177      collects charges or premiums from, or who, for consideration, adjusts or settles claims of


             1178      residents of the state in connection with insurance coverage, annuities, or service insurance
             1179      coverage, except:
             1180          (a) a union on behalf of its members;
             1181          (b) a person administering a:
             1182          (i) pension plan subject to the federal Employee Retirement Income Security Act of
             1183      1974;
             1184          (ii) governmental plan as defined in Section 414(d), Internal Revenue Code; or
             1185          (iii) nonelecting church plan as described in Section 410(d), Internal Revenue Code;
             1186          (c) an employer on behalf of the employer's employees or the employees of one or
             1187      more of the subsidiary or affiliated corporations of the employer;
             1188          (d) an insurer licensed under the following, but only for a line of insurance for which
             1189      the insurer holds a license in this state:
             1190          (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
             1191          (ii) Chapter 7, Nonprofit Health Service Insurance Corporations;
             1192          (iii) Chapter 8, Health Maintenance Organizations and Limited Health Plans;
             1193          (iv) Chapter 9, Insurance Fraternals; or
             1194          (v) Chapter 14, Foreign Insurers;
             1195          (e) a person:
             1196          (i) licensed or exempt from licensing under:
             1197          (A) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
             1198      Reinsurance Intermediaries; or
             1199          (B) Chapter 26, Insurance Adjusters; and
             1200          (ii) whose activities are limited to those authorized under the license the person holds
             1201      or for which the person is exempt; or
             1202          (f) an institution, bank, or financial institution:
             1203          (i) that is:
             1204          (A) an institution whose deposits and accounts are to any extent insured by a federal
             1205      deposit insurance agency, including the Federal Deposit Insurance Corporation or National


             1206      Credit Union Administration; or
             1207          (B) a bank or other financial institution that is subject to supervision or examination by
             1208      a federal or state banking authority; and
             1209          (ii) that does not adjust claims without a third party administrator license.
             1210          [(163)] (164) "Title insurance" means the insuring, guaranteeing, or indemnifying of an
             1211      owner of real or personal property or the holder of liens or encumbrances on that property, or
             1212      others interested in the property against loss or damage suffered by reason of liens or
             1213      encumbrances upon, defects in, or the unmarketability of the title to the property, or invalidity
             1214      or unenforceability of any liens or encumbrances on the property.
             1215          [(164)] (165) "Total adjusted capital" means the sum of an insurer's or health
             1216      organization's statutory capital and surplus as determined in accordance with:
             1217          (a) the statutory accounting applicable to the annual financial statements required to be
             1218      filed under Section 31A-4-113 ; and
             1219          (b) another item provided by the RBC instructions, as RBC instructions is defined in
             1220      Section 31A-17-601 .
             1221          [(165)] (166) (a) "Trustee" means "director" when referring to the board of directors of
             1222      a corporation.
             1223          (b) "Trustee," when used in reference to an employee welfare fund, means an
             1224      individual, firm, association, organization, joint stock company, or corporation, whether acting
             1225      individually or jointly and whether designated by that name or any other, that is charged with
             1226      or has the overall management of an employee welfare fund.
             1227          [(166)] (167) (a) "Unauthorized insurer," "unadmitted insurer," or "nonadmitted
             1228      insurer" means an insurer:
             1229          (i) not holding a valid certificate of authority to do an insurance business in this state;
             1230      or
             1231          (ii) transacting business not authorized by a valid certificate.
             1232          (b) "Admitted insurer" or "authorized insurer" means an insurer:
             1233          (i) holding a valid certificate of authority to do an insurance business in this state; and


             1234          (ii) transacting business as authorized by a valid certificate.
             1235          [(167)] (168) "Underwrite" means the authority to accept or reject risk on behalf of the
             1236      insurer.
             1237          [(168)] (169) "Vehicle liability insurance" means insurance against liability resulting
             1238      from or incident to ownership, maintenance, or use of a land vehicle or aircraft, exclusive of a
             1239      vehicle comprehensive or vehicle physical damage coverage under Subsection [(138)] (139).
             1240          [(169)] (170) "Voting security" means a security with voting rights, and includes a
             1241      security convertible into a security with a voting right associated with the security.
             1242          [(170)] (171) "Waiting period" for a health benefit plan means the period that must
             1243      pass before coverage for an individual, who is otherwise eligible to enroll under the terms of
             1244      the health benefit plan, can become effective.
             1245          [(171)] (172) "Workers' compensation insurance" means:
             1246          (a) insurance for indemnification of an employer against liability for compensation
             1247      based on:
             1248          (i) a compensable accidental injury; and
             1249          (ii) occupational disease disability;
             1250          (b) employer's liability insurance incidental to workers' compensation insurance and
             1251      written in connection with workers' compensation insurance; and
             1252          (c) insurance assuring to a person entitled to workers' compensation benefits the
             1253      compensation provided by law.
             1254          Section 2. Section 31A-2-201.2 is amended to read:
             1255           31A-2-201.2. Evaluation of health insurance market.
             1256          (1) Each year the commissioner shall:
             1257          (a) conduct an evaluation of the state's health insurance market;
             1258          (b) report the findings of the evaluation to the Health and Human Services Interim
             1259      Committee before October 1 of each year; and
             1260          (c) publish the findings of the evaluation on the department website.
             1261          (2) The evaluation required by this section shall:


             1262          (a) analyze the effectiveness of the insurance regulations and statutes in promoting a
             1263      healthy, competitive health insurance market that meets the needs of the state, and includes an
             1264      analysis of:
             1265          (i) the availability and marketing of individual and group products;
             1266          (ii) rate changes;
             1267          (iii) coverage and demographic changes;
             1268          (iv) benefit trends;
             1269          (v) market share changes; and
             1270          (vi) accessibility;
             1271          (b) assess complaint ratios and trends within the health insurance market, which
             1272      assessment shall include complaint data from the Office of Consumer Health Assistance within
             1273      the department;
             1274          (c) contain recommendations for action to improve the overall effectiveness of the
             1275      health insurance market, administrative rules, and statutes; and
             1276          (d) include claims loss ratio data for each health insurance company doing business in
             1277      the state.
             1278          (3) When preparing the evaluation required by this section, the commissioner shall
             1279      include a report of:
             1280          (a) the types of health benefit plans sold in the Health Insurance Exchange created in
             1281      Section 63M-1-2504 ;
             1282          (b) the number of insurers participating in the defined contribution arrangement health
             1283      benefit plans in the Health Insurance Exchange; and
             1284          (c) the number of employers and covered lives in the defined contribution arrangement
             1285      market in the Health Insurance Exchange[; and].
             1286          [(d) the number of lives covered by health benefit plans that do not include state
             1287      mandates as permitted by Subsection 31A-30-109 (2).]
             1288          (4) When preparing the evaluation and report required by this section, the
             1289      commissioner may seek the input of insurers, employers, insured persons, providers, and others


             1290      with an interest in the health insurance market.
             1291          (5) The commissioner may adopt administrative rules for the purpose of collecting the
             1292      data required by this section, taking into account the business confidentiality of the insurers.
             1293          (6) Records submitted to the commissioner under this section shall be maintained by
             1294      the commissioner as protected records under Title 63G, Chapter 2, Government Records
             1295      Access and Management Act.
             1296          Section 3. Section 31A-2-217 is amended to read:
             1297           31A-2-217. Coordination with other states.
             1298          (1) (a) Subject to Subsection (1)(b), the commissioner, by rule, may adopt one or more
             1299      agreements with [another] a state governmental regulatory agency, within and outside of this
             1300      state, or with the National Association of Insurance Commissioners to address state regulatory
             1301      issues limited to:
             1302          (i) licensing of insurance companies;
             1303          (ii) licensing of agents;
             1304          (iii) regulation of premium rates and policy forms; and
             1305          (iv) regulation of insurer insolvency and insurance receiverships.
             1306          (b) An agreement described in Subsection (1)(a), may authorize the commissioner to
             1307      modify a requirement of this title if the commissioner determines that the requirements under
             1308      the agreement provide protections similar to or greater than the requirements under this title.
             1309          (2) (a) The commissioner may negotiate an interstate compact that addresses issuing
             1310      certificates of authority, if the commissioner determines that:
             1311          (i) each state participating in the compact has requirements for issuing certificates of
             1312      authority that provide protections similar to or greater than the requirements of this title; or
             1313          (ii) the interstate compact contains requirements for issuing certificates of authority
             1314      that provide protections similar to or greater than the requirements of this title.
             1315          (b) If an interstate compact described in Subsection (2)(a) is adopted by the
             1316      Legislature, the commissioner may issue certificates of authority to insurers in accordance with
             1317      the terms of the interstate compact.


             1318          (3) If any provision of this title conflicts with a provision of the annual statement
             1319      instructions or the National Association of Insurance Commissioners Accounting Practices and
             1320      Procedures Manual, the commissioner may, by rule, resolve the conflict in favor of the annual
             1321      statement instructions or the National Association of Insurance Commissioners Accounting
             1322      Practices and Procedures Manual.
             1323          (4) The commissioner may, by rule, accept the information prescribed by the National
             1324      Association of Insurance Commissioners instead of the documents required to be filed with an
             1325      application for a certificate of authority under:
             1326          (a) Section 31A-4-103 , 31A-5-204 , 31A-8-205 , or 31A-14-201 ; or
             1327          (b) rules made by the commissioner.
             1328          (5) Before November 30, 2001, the commissioner shall report to the Business and
             1329      Labor Interim Committee regarding the status of:
             1330          (a) any agreements entered into under Subsection (1);
             1331          (b) any interstate compact entered into under Subsection (2); and
             1332          (c) any rule made under Subsections (3) and (4).
             1333          (6) This section shall be repealed in accordance with Section 63I-1-231 .
             1334          Section 4. Section 31A-2-402 is amended to read:
             1335           31A-2-402. Definitions.
             1336          As used in this part:
             1337          (1) "Commission" means the Title and Escrow Commission created in Section
             1338      31A-2-403 .
             1339          (2) "Concurrence" means the entities given a concurring role must jointly agree for the
             1340      action to be taken.
             1341          (3) "Dual licensed title licensee" means a title licensee who holds:
             1342          (a) [a] an individual title insurance producer license as a title licensee; and
             1343          (b) a license or certificate under:
             1344          (i) Title 61, Chapter 2c, Utah Residential Mortgage Practices and Licensing Act;
             1345          (ii) Title 61, Chapter 2f, Real Estate Licensing and Practices Act; or


             1346          (iii) Title 61, Chapter 2g, Real Estate Appraiser Licensing and Certification Act.
             1347          (4) "Real Estate Commission" means the Real Estate Commission created in Section
             1348      61-2f-103 .
             1349          (5) "Title licensee" means a person licensed under this title as:
             1350          (a) an agency title insurance producer with a title insurance line of authority;
             1351          (b) [a] an individual title insurance producer with:
             1352          (i) a general title insurance line of authority; or
             1353          (ii) a specific category of authority for title insurance; or
             1354          (c) a title insurance adjuster.
             1355          Section 5. Section 31A-2-403 is amended to read:
             1356           31A-2-403. Title and Escrow Commission created.
             1357          (1) (a) Subject to Subsection (1)(b), there is created within the department the Title and
             1358      Escrow Commission that is comprised of five members appointed by the governor with the
             1359      consent of the Senate as follows beginning July 1, 2013:
             1360          [(i) four members shall each:]
             1361          (i) two members shall be employees of a title insurer;
             1362          (ii) two members shall:
             1363          (A) be employees of a Utah agency title insurance producer;
             1364          [(A)] (B) be or have been licensed under the title insurance line of authority;
             1365          [(B)] (C) as of the day on which the member is appointed, be or have been licensed
             1366      with the search or escrow subline of authority for at least five years; and
             1367          [(C)] (D) as of the day on which the member is appointed, not be from the same county
             1368      as another member appointed under this Subsection (1)(a)[(i)](ii); and
             1369          [(ii)] (iii) one member shall be a member of the general public from any county in the
             1370      state.
             1371          (b) No more than one commission member may be appointed from a single company
             1372      or an affiliate or subsidiary of the company.
             1373          (2) (a) Subject to Subsection (2)(c), a commission member shall file with the


             1374      commissioner a disclosure of any position of employment or ownership interest that the
             1375      commission member has with respect to a person that is subject to the jurisdiction of the
             1376      commissioner.
             1377          (b) The disclosure statement required by this Subsection (2) shall be:
             1378          (i) filed by no later than the day on which the person begins that person's appointment;
             1379      and
             1380          (ii) amended when a significant change occurs in any matter required to be disclosed
             1381      under this Subsection (2).
             1382          (c) A commission member is not required to disclose an ownership interest that the
             1383      commission member has if the ownership interest is in a publicly traded company or held as
             1384      part of a mutual fund, trust, or similar investment.
             1385          (3) (a) Except as required by Subsection (3)(b), as terms of current commission
             1386      members expire, the governor shall appoint each new commission member to a four-year term
             1387      ending on June 30.
             1388          (b) Notwithstanding the requirements of Subsection (3)(a), the governor shall, at the
             1389      time of appointment, adjust the length of terms to ensure that the terms of the commission
             1390      members are staggered so that approximately half of the [commission is] members appointed
             1391      under Subsection (1)(a)(i) and half of the members appointed under Subsection (1)(a)(ii) are
             1392      appointed every two years.
             1393          (c) A commission member may not serve more than one consecutive term.
             1394          (d) When a vacancy occurs in the membership for any reason, the governor, with the
             1395      consent of the Senate, shall appoint a replacement for the unexpired term.
             1396          (e) Notwithstanding the other provisions of this Subsection (3), a commission member
             1397      serves until a successor is appointed by the governor with the consent of the Senate.
             1398          (4) A commission member may not receive compensation or benefits for the
             1399      commission member's service, but may receive per diem and travel expenses in accordance
             1400      with:
             1401          (a) Section 63A-3-106 ;


             1402          (b) Section 63A-3-107 ; and
             1403          (c) rules made by the Division of Finance pursuant to Sections 63A-3-106 and
             1404      63A-3-107 .
             1405          (5) Members of the commission shall annually select one commission member to serve
             1406      as chair.
             1407          (6) (a) The commission shall meet at least monthly. Notwithstanding Section
             1408      52-4-207 , a commission member shall physically attend a regularly scheduled monthly meeting
             1409      of the commission and may not attend through electronic means. A commission member may
             1410      attend subcommittee meetings, emergency meetings, or other not regularly scheduled meetings
             1411      electronically in accordance with Section 52-4-207 .
             1412          (b) The commissioner may call additional meetings:
             1413          (i) at the commissioner's discretion;
             1414          (ii) upon the request of the chair of the commission; or
             1415          (iii) upon the written request of three or more commission members.
             1416          (c) (i) Three commission members constitute a quorum for the transaction of business.
             1417          (ii) The action of a majority of the commission members when a quorum is present is
             1418      the action of the commission.
             1419          (7) The commissioner shall staff the commission.
             1420          Section 6. Section 31A-2-404 is amended to read:
             1421           31A-2-404. Duties of the commissioner and Title and Escrow Commission.
             1422          (1) Notwithstanding the other provisions of this chapter, to the extent provided in this
             1423      part, the commissioner shall administer and enforce the provisions in this title related to:
             1424          (a) title insurance; and
             1425          (b) escrow conducted by a title licensee or title insurer.
             1426          (2) The commission shall:
             1427          (a) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, and
             1428      subject to Subsection [(3)] (4), make rules for the administration of the provisions in this title
             1429      related to title insurance including rules related to:


             1430          (i) rating standards and rating methods for a title licensee, as provided in Section
             1431      31A-19a-209 ;
             1432          (ii) the licensing for a title licensee, including the licensing requirements of Section
             1433      31A-23a-204 ;
             1434          (iii) continuing education requirements of Section 31A-23a-202 ; and
             1435          [(iv) examination procedures, after consultation with the commissioner and the
             1436      commissioner's test administrator when required by Section 31A-23a-204 ; and]
             1437          [(v)] (iv) standards of conduct for a title licensee;
             1438          (b) concur in the issuance and renewal of a license in accordance with Section
             1439      31A-23a-105 or 31A-26-203 ;
             1440          (c) in accordance with Section 31A-3-103 , establish, with the concurrence of the
             1441      commissioner, the fees imposed by this title on a title licensee;
             1442          (d) in accordance with Section 31A-23a-415 determine, after consulting with the
             1443      commissioner, the assessment on a title insurer as defined in Section 31A-23a-415 ;
             1444          (e) conduct an administrative hearing not delegated by the commission to an
             1445      administrative law judge related to the:
             1446          (i) licensing of an applicant;
             1447          (ii) conduct of a title licensee; or
             1448          (iii) approval of a continuing education program required by Section 31A-23a-202 ;
             1449          (f) with the concurrence of the commissioner, approve a continuing education program
             1450      required by Section 31A-23a-202 ;
             1451          (g) with the concurrence of the commissioner, impose a penalty:
             1452          (i) under this title related to:
             1453          (A) title insurance; or
             1454          (B) escrow conducted by a title licensee;
             1455          (ii) after investigation by the commissioner in accordance with Part 3, Procedures and
             1456      Enforcement; and
             1457          (iii) that is enforced by the commissioner;


             1458          (h) advise the commissioner on the administration and enforcement of any matter
             1459      affecting the title insurance industry;
             1460          (i) advise the commissioner on matters affecting the commissioner's budget related to
             1461      title insurance; and
             1462          (j) perform other duties as provided in this title.
             1463          (3) The commission may make rules establishing an examination for a license that will
             1464      satisfy Section 31A-23a-204 :
             1465          (a) after consultation with the commissioner and the commissioner's test administrator;
             1466          (b) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act; and
             1467          (c) subject to Subsection (4).
             1468          [(3)] (4) The commission may make a rule under this title only if at the time the
             1469      commission files its proposed rule and rule analysis with the Division of Administrative Rules
             1470      in accordance with Section 63G-3-301 , the commission provides the Real Estate Commission
             1471      that same information.
             1472          [(4)] (5) (a) The commissioner shall annually report the information described in
             1473      Subsection [(4)] (5)(b) in writing to:
             1474          (i) the commission; and
             1475          (ii) the Business and Labor Interim Committee.
             1476          (b) The information required to be reported under this Subsection [(4)] (5):
             1477          (i) may not identify a person; and
             1478          (ii) shall include:
             1479          (A) the number of complaints the commissioner receives with regard to transactions
             1480      involving title insurance or a title licensee during the calendar year immediately proceeding the
             1481      report;
             1482          (B) the type of complaints described in Subsection [(4)] (5)(b)(ii)(A); and
             1483          (C) for each complaint described in Subsection [(4)] (5)(b)(ii)(A):
             1484          (I) any action taken by the commissioner with regard to the complaint; and
             1485          (II) the time-period beginning the day on which a complaint is made and ending the


             1486      day on which the commissioner determines it will take no further action with regard to the
             1487      complaint.
             1488          (6) The commission may not impose a penalty in a manner inconsistent with
             1489      Subsection (2)(g) or make a rule that conflicts with Subsection (2)(g).
             1490          Section 7. Section 31A-3-304 (Effective 07/01/13) is amended to read:
             1491           31A-3-304 (Effective 07/01/13). Annual fees -- Other taxes or fees prohibited --
             1492      Captive Insurance Restricted Account.
             1493          (1) (a) A captive insurance company shall pay an annual fee imposed under this section
             1494      to obtain or renew a certificate of authority.
             1495          (b) The commissioner shall:
             1496          (i) determine the annual fee pursuant to Section 31A-3-103 ; and
             1497          (ii) consider whether the annual fee is competitive with fees imposed by other states on
             1498      captive insurance companies.
             1499          (2) A captive insurance company that fails to pay the fee required by this section is
             1500      subject to the relevant sanctions of this title.
             1501          (3) (a) Except as provided in Subsection (3)(d) and notwithstanding Title 59, Chapter
             1502      9, Taxation of Admitted Insurers, the following constitute the sole taxes, fees, or charges under
             1503      the laws of this state that may be levied or assessed on a captive insurance company:
             1504          (i) a fee under this section;
             1505          (ii) a fee under Chapter 37, Captive Insurance Companies Act; and
             1506          (iii) a fee under Chapter 37a, Special Purpose Financial Captive Insurance Company
             1507      Act.
             1508          (b) The state or a county, city, or town within the state may not levy or collect an
             1509      occupation tax or other tax, fee, or charge not described in Subsections (3)(a)(i) through (iii)
             1510      against a captive insurance company.
             1511          (c) The state may not levy, assess, or collect a withdrawal fee under Section 31A-4-115
             1512      against a captive insurance company.
             1513          (d) A captive insurance company is subject to real and personal property taxes.


             1514          (4) A captive insurance company shall pay the fee imposed by this section to the
             1515      commissioner by June 20 of each year.
             1516          (5) (a) Money received pursuant to a fee described in Subsection (3)(a) shall be
             1517      deposited into the Captive Insurance Restricted Account.
             1518          (b) There is created in the General Fund a restricted account known as the "Captive
             1519      Insurance Restricted Account."
             1520          (c) The Captive Insurance Restricted Account shall consist of the fees described in
             1521      Subsection (3)(a).
             1522          (d) The commissioner shall administer the Captive Insurance Restricted Account.
             1523      Subject to appropriations by the Legislature, the commissioner shall use the money deposited
             1524      into the Captive Insurance Restricted Account to:
             1525          (i) administer and enforce:
             1526          (A) Chapter 37, Captive Insurance Companies Act; and
             1527          (B) Chapter 37a, Special Purpose Financial Captive Insurance Company Act; and
             1528          (ii) promote the captive insurance industry in Utah.
             1529          (e) An appropriation from the Captive Insurance Restricted Account is nonlapsing,
             1530      except that at the end of each fiscal year, money received by the commissioner in excess of
             1531      [$950,000] $1,250,000 shall be treated as free revenue in the General Fund.
             1532          Section 8. Section 31A-4-117 is enacted to read:
             1533          31A-4-117. Closing or settlement protection.
             1534          (1) A title insurer may issue closing or settlement protection in the form of a closing
             1535      protection letter filed with the department to a person who is a party to a transaction in which a
             1536      title insurance policy is issued.
             1537          (2) Closing or settlement protection may indemnify a person who is a party to a
             1538      transaction referred to in Subsection (1) against loss that the title insurer approves for the
             1539      closing or settlement protection, under the terms and conditions of the closing protection letter
             1540      issued by the title insurer, because of one or more of the following acts of a title insurance
             1541      policy issuing individual title insurance producer or agency title insurance producer or other


             1542      settlement service provider:
             1543          (a) theft or misappropriation of settlement funds in connection with a transaction in
             1544      which one or more title insurance policies are issued by or on behalf of the title insurer issuing
             1545      the closing or settlement protection, but only to the extent that the theft or misappropriation
             1546      relates to the status of the title to that interest in land or to the validity, enforceability, and
             1547      priority of the lien of the mortgage on that interest in land; or
             1548          (b) failure to comply with the written closing instructions when agreed to by the
             1549      settlement agent, title agent, or employee of the title insurer, but only to the extent that the
             1550      failure to follow the written closing instructions relates to the status of the title to that interest
             1551      in land or the validity, enforceability, and priority of the lien of the mortgage on that interest in
             1552      land.
             1553          (3) A title insurer may not make the fee charged by a title insurer for each party
             1554      receiving closing or settlement protection coverage subject to any agreement requiring a
             1555      division of fees or premiums collected on behalf of the title insurer. The fee charged for a
             1556      closing or settlement coverage protection letter will be filed by the title insurer with the
             1557      department 30 days before use.
             1558          (4) A title insurer may not provide any other protection that purports to contractually
             1559      indemnify against improper acts or omissions of a person who is a party to a transaction
             1560      referred to in Subsection (1) with regard to settlement or closing services.
             1561          Section 9. Section 31A-8-301 is amended to read:
             1562           31A-8-301. Requirements for doing business in state.
             1563          (1) Only a corporation incorporated and licensed under Part 2, Domestic
             1564      Organizations, may do business in this state as an organization.
             1565          (2) To do business in this state as an organization, a foreign [corporations] corporation
             1566      doing a similar business in other states shall incorporate a subsidiary and license [if] it under
             1567      Part 2, Domestic Organizations, for its Utah business. Except as to Chapter 16, Insurance
             1568      Holding Companies, the laws applicable to a domestic [organizations] organization apply only
             1569      to the domestic organization and not to its foreign parent corporation.


             1570          Section 10. Section 31A-14-211 is amended to read:
             1571           31A-14-211. Restrictions on foreign title insurers.
             1572          (1) An authorized foreign title insurer may [not] only insure property in this state
             1573      [except]:
             1574          (a) through [a] an agency title insurance producer who is a resident in Utah; or
             1575          (b) [through] if the authorized foreign title insurer has a bona fide office in Utah:
             1576          (i) that is under the direction and control of the authorized foreign title insurer;
             1577          (ii) for which the authorized foreign title insurer pays the expenses, including
             1578      compensation of the employees of the bona fide office;
             1579          (iii) at which a person may request information about title services related to a real
             1580      estate transaction for which the person is a party;
             1581          (iv) at which a person may deliver written communications to the authorized foreign
             1582      title insurer as required by the real estate transaction for which the person is a party; and
             1583          (v) at which a person may deliver escrow money related to a real estate transaction for
             1584      which the person is a party.
             1585          (2) This section does not apply to reinsurance.
             1586          Section 11. Section 31A-17-603 is amended to read:
             1587           31A-17-603. Company action level event.
             1588          (1) "Company action level event" means any of the following events:
             1589          (a) the filing of an RBC report by an insurer or health organization that indicates that:
             1590          (i) the insurer's or health organization's total adjusted capital is greater than or equal to
             1591      its regulatory action level RBC but less than its company action level RBC; [or]
             1592          (ii) if a life or accident and health insurer, the insurer has:
             1593          (A) total adjusted capital that is greater than or equal to its company action level RBC
             1594      but less than the product of its authorized control level RBC and [2.5] 3.0; and
             1595          [(B) a negative trend, determined in accordance with the "trend test calculation"
             1596      included in the RBC instructions;]
             1597          (B) triggers the trend test determined in accordance with the trend test calculation


             1598      included in the life or fraternal RBC instructions; or
             1599          (iii) if a property and casualty insurer, the insurer has:
             1600          (A) total adjusted capital that is greater than or equal to its company action level RBC,
             1601      but less than the product of its authorized control level RBC and 3.0; and
             1602          (B) triggers the trend test determined in accordance with the trend test calculation
             1603      included in the property and casualty RBC instructions;
             1604          (b) the notification by the commissioner to the insurer or health organization of an
             1605      adjusted RBC report that indicates an event in Subsection (1)(a), provided the insurer or health
             1606      organization does not challenge the adjusted RBC report under Section 31A-17-607 ; or
             1607          (c) if, pursuant to Section 31A-17-607 , an insurer or health organization challenges an
             1608      adjusted RBC report that indicates the event in Subsection (1)(a), the notification by the
             1609      commissioner to the insurer or health organization that after a hearing the commissioner rejects
             1610      the insurer's or health organization's challenge.
             1611          (2) (a) In the event of a company action level event, the insurer or health organization
             1612      shall prepare and submit to the commissioner an RBC plan that shall:
             1613          (i) identify the conditions that contribute to the company action level event;
             1614          (ii) contain proposals of corrective actions that the insurer or health organization
             1615      intends to take and that are expected to result in the elimination of the company action level
             1616      event;
             1617          (iii) provide projections of the insurer's or health organization's financial results in the
             1618      current year and at least the four succeeding years, both in the absence of proposed corrective
             1619      actions and giving effect to the proposed corrective actions, including projections of:
             1620          (A) statutory operating income;
             1621          (B) net income;
             1622          (C) capital;
             1623          (D) surplus; and
             1624          (E) RBC levels;
             1625          (iv) identify the key assumptions impacting the insurer's or health organization's


             1626      projections and the sensitivity of the projections to the assumptions; and
             1627          (v) identify the quality of, and problems associated with, the insurer's or health
             1628      organization's business, including its assets, anticipated business growth and associated surplus
             1629      strain, extraordinary exposure to risk, mix of business and use of reinsurance, if any, in each
             1630      case.
             1631          (b) For purposes of Subsection (2)(a)(iii), the projections for both new and renewal
             1632      business may include separate projections for each major line of business and separately
             1633      identify each significant income, expense, and benefit component.
             1634          (3) The RBC plan shall be submitted:
             1635          (a) within 45 days of the company action level event; or
             1636          (b) if the insurer or health organization challenges an adjusted RBC report pursuant to
             1637      Section 31A-17-607 , within 45 days after notification to the insurer or health organization that
             1638      after a hearing the commissioner rejects the insurer's or health organization's challenge.
             1639          (4) (a) Within 60 days after the submission by an insurer or health organization of an
             1640      RBC plan to the commissioner, the commissioner shall notify the insurer or health organization
             1641      whether the RBC plan:
             1642          (i) shall be implemented; or
             1643          (ii) is unsatisfactory.
             1644          (b) If the commissioner determines the RBC plan is unsatisfactory, the notification to
             1645      the insurer or health organization shall set forth the reasons for the determination, and may
             1646      propose revisions that will render the RBC plan satisfactory. Upon notification from the
             1647      commissioner, the insurer or health organization shall:
             1648          (i) prepare a revised RBC plan that incorporates any revision proposed by the
             1649      commissioner; and
             1650          (ii) submit the revised RBC plan to the commissioner:
             1651          (A) within 45 days after the notification from the commissioner; or
             1652          (B) if the insurer challenges the notification from the commissioner under Section
             1653      31A-17-607 , within 45 days after a notification to the insurer or health organization that after a


             1654      hearing the commissioner rejects the insurer's or health organization's challenge.
             1655          (5) In the event of a notification by the commissioner to an insurer or health
             1656      organization that the insurer's or health organization's RBC plan or revised RBC plan is
             1657      unsatisfactory, the commissioner may specify in the notification that the notification constitutes
             1658      a regulatory action level event subject to the insurer's or health organization's right to a hearing
             1659      under Section 31A-17-607 .
             1660          (6) Every domestic insurer or health organization that files an RBC plan or revised
             1661      RBC plan with the commissioner shall file a copy of the RBC plan or revised RBC plan with
             1662      the insurance commissioner in any state in which the insurer or health organization is
             1663      authorized to do business if:
             1664          (a) the state has an RBC provision substantially similar to Subsection 31A-17-608 (1);
             1665      and
             1666          (b) the insurance commissioner of that state notifies the insurer or health organization
             1667      of its request for the filing in writing, in which case the insurer or health organization shall file
             1668      a copy of the RBC plan or revised RBC plan in that state no later than the later of:
             1669          (i) 15 days after the receipt of notice to file a copy of its RBC plan or revised RBC plan
             1670      with that state; or
             1671          (ii) the date on which the RBC plan or revised RBC plan is filed under Subsections (3)
             1672      and (4).
             1673          Section 12. Section 31A-19a-209 is amended to read:
             1674           31A-19a-209. Special provisions for title insurance.
             1675          (1) (a) (i) The Title and Escrow Commission shall adopt rules subject to Section
             1676      31A-2-404 , establishing rate standards and rating methods for [title agencies and producers]
             1677      individual title insurance producers and agency title insurance producers.
             1678          (ii) The commissioner shall determine compliance with rate standards and rating
             1679      methods for title insurance insurers[, agencies, and producers], individual title insurance
             1680      producers, and agency title insurance producers.
             1681          (b) In addition to the considerations in determining compliance with rate standards and


             1682      rating methods as set forth in Sections 31A-19a-201 and 31A-19a-202 , including for title
             1683      insurers, the commissioner and the Title and Escrow Commission shall consider the costs and
             1684      expenses incurred by title insurance insurers[, agencies, and producers], individual title
             1685      insurance producers, and agency title insurance producers peculiar to the business of title
             1686      insurance including:
             1687          (i) the maintenance of title plants; and
             1688          (ii) the searching and examining of public records to determine insurability of title to
             1689      real redevelopment property.
             1690          (2) (a) Every title insurance insurer[,] or agency[, and] title insurance producer, and
             1691      every individual title insurance producer who is not designated by an agency title insurance
             1692      producer, shall file with the commissioner:
             1693          (i) a schedule of the escrow charges that the title insurance insurer[, agency, or],
             1694      individual title insurance producer, or agency title insurance producer proposes to use in this
             1695      state for services performed in connection with the issuance of policies of title insurance; and
             1696          (ii) any changes to the schedule of the escrow charges described in Subsection (2)(a)(i).
             1697          (b) Except for a schedule filed by a title insurance insurer under this Subsection (2), a
             1698      schedule filed under this Subsection (2) is subject to review by the Title and Escrow
             1699      Commission.
             1700          (c) (i) The schedule of escrow charges required to be filed by Subsection (2)(a)(i) takes
             1701      effect on the day on which the schedule of escrow charges is filed.
             1702          (ii) Any changes to the schedule of the escrow charges required to be filed by
             1703      Subsection (2)(a)(ii) take effect on the day specified in the change to the schedule of escrow
             1704      charges except that the effective date may not be less than 30 calendar days after the day on
             1705      which the change to the schedule of escrow charges is filed.
             1706          (3) A title insurance insurer[, agency, or producer], individual title insurance producer,
             1707      or agency title insurance producer may not file or use any rate or other charge relating to the
             1708      business of title insurance, including rates or charges filed for escrow that would cause the title
             1709      insurance company[, agency, or producer], individual title insurance producer, or agency title


             1710      insurance producer to:
             1711          (a) operate at less than the cost of doing:
             1712          (i) the insurance business; or
             1713          (ii) the escrow business; or
             1714          (b) fail to adequately underwrite a title insurance policy.
             1715          (4) (a) All or any of the schedule of rates or schedule of charges, including the schedule
             1716      of escrow charges, may be changed or amended at any time, subject to the limitations in this
             1717      Subsection (4).
             1718          (b) Each change or amendment shall:
             1719          (i) be filed with the commissioner, subject to review by the Title and Escrow
             1720      Commission; and
             1721          (ii) state the effective date of the change or amendment, which may not be less than 30
             1722      calendar days after the day on which the change or amendment is filed.
             1723          (c) Any change or amendment remains in force for a period of at least 90 calendar days
             1724      from the change or amendment's effective date.
             1725          (5) While the schedule of rates and schedule of charges are effective, a copy of each
             1726      shall be:
             1727          (a) retained in each of the offices of:
             1728          (i) the title insurance insurer in this state;
             1729          (ii) the title insurance insurer's individual title insurance producers or agency title
             1730      insurance producers in this state; and
             1731          (b) upon request, furnished to the public.
             1732          (6) Except in accordance with the schedules of rates and charges filed with the
             1733      commissioner, a title insurance insurer[, agency, or producer], individual title insurance
             1734      producer, or agency title insurance producer may not make or impose any premium or other
             1735      charge:
             1736          (a) in connection with the issuance of a policy of title insurance; or
             1737          (b) for escrow services performed in connection with the issuance of a policy of title


             1738      insurance.
             1739          Section 13. Section 31A-20-110 is amended to read:
             1740           31A-20-110. Underwriting rules for title insurance.
             1741          (1) [No] A title insurance policy may not be written until the title insurer or its
             1742      individual title insurance producer or agency title insurance producer has conducted a
             1743      reasonable search and examination of the title and has made a determination of insurability of
             1744      title under sound underwriting principles. Evidence of this search and reasonable
             1745      determination shall be retained in the files of the title insurer or its individual title insurance
             1746      producer or agency title insurance producer for not less than 15 years after the policy has been
             1747      issued, either in its original form or as recorded by any process which can accurately and
             1748      reliably reproduce the original. This section does not apply to a company assuming liability
             1749      through a contract of reinsurance, or to a company acting as coinsurer, if another coinsuring
             1750      company has complied with this section.
             1751          (2) [No] A title insurance policy may not be issued except by a title [insurance
             1752      company or by a] insurer, an individual title insurance producer who is appointed by an insurer,
             1753      or agency title insurance producer licensed under Section 31A-23a-105 .
             1754          (3) This section is enforceable only by the commissioner. It does not create, eliminate,
             1755      or modify any private cause of action or remedy.
             1756          Section 14. Section 31A-21-503 is amended to read:
             1757           31A-21-503. Discrimination based on domestic violence or child abuse
             1758      prohibited.
             1759          (1) Except as provided in Subsection (2), an insurer of life or accident and health
             1760      insurance may not consider whether an insured or applicant is the subject of domestic abuse as
             1761      a factor to:
             1762          (a) refuse to insure the applicant;
             1763          (b) refuse to continue to insure the insured;
             1764          (c) refuse to renew or reissue a policy to insure the insured or applicant;
             1765          (d) limit the amount, extent, or kind of coverage available to the insured or applicant;


             1766          (e) charge a different rate for coverage to the insured or applicant;
             1767          (f) exclude or limit benefits or coverage under an insurance policy or contract for
             1768      losses incurred;
             1769          (g) deny a claim; or
             1770          (h) terminate coverage or fail to provide conversion privileges in violation of
             1771      [Sections] Section 31A-22-612 [and 31A-22-723 ] under a group accident and health policy for
             1772      the insured because the coverage was issued in the name of the perpetrator of the domestic
             1773      violence or abuse.
             1774          (2) (a) Notwithstanding Subsection (1), an insurer may underwrite on the basis of the
             1775      physical or mental condition of an insured or applicant if the underwriting is on the basis of a
             1776      determination that there is a correlation between the medical or mental condition and a material
             1777      increase in insurance risk.
             1778          (b) For purposes of Subsection (2)(a), the fact that an insured or applicant is a subject
             1779      of domestic abuse is not a mental or physical condition.
             1780          (c) The determination required by Subsection (2)(a) shall be made in conformance with
             1781      sound actuarial principles.
             1782          (d) Within 30 days after receiving an oral or written request from an insured or
             1783      applicant, an insurer shall disclose in writing:
             1784          (i) the basis of an action permitted under Subsection (2)(a); and
             1785          (ii) if the policy has been issued or modified, the extent the action taken will impact the
             1786      amount, extent, or kind of coverage or benefits available to the insured.
             1787          Section 15. Section 31A-22-429 is enacted to read:
             1788          31A-22-429. Producer's duties related to replacement of life insurance or annuity.
             1789          (1) In connection with or as part of each application for life insurance or annuities, the
             1790      applicant shall complete and the producer shall submit to the insurer the statements required by
             1791      rule made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, as
             1792      to:
             1793          (a) whether the applicant has existing policies or contracts; and


             1794          (b) whether the proposed life insurance or annuity will replace, discontinue, or change
             1795      an existing policy or contract.
             1796          (2) If an applicant for life insurance or an annuity answers "yes" to the question
             1797      regarding replacement, discontinuance, or change of an existing policy or contract referred to in
             1798      Subsection (1), the producer shall present to the applicant, not later than at the time of taking
             1799      the application, the notice regarding replacements in the form adopted by the commissioner by
             1800      rule made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, or
             1801      other substantially similar document filed with the commissioner.
             1802          (3) (a) The notice described in Subsection (2) shall:
             1803          (i) list each existing policy or contract contemplated to be replaced, properly identified
             1804      by name of insurer, the insured or annuitant, and policy or contract number if available; and
             1805          (ii) include a statement as to whether each policy or contract will be replaced or
             1806      whether a policy will be used as a source of financing for the new policy or contract.
             1807          (b) If a policy or contract number has not been issued by the existing insurer,
             1808      alternative identification, such as an application or receipt number, shall be listed.
             1809          (4) In connection with a replacement transaction, the producer shall leave with the
             1810      applicant by no later than at the time of policy or contract delivery the original or a copy of all
             1811      printed sales material. With respect to electronically presented sales material, it shall be
             1812      provided to the policy or contract holder in printed form no later than at the time of policy or
             1813      contract delivery.
             1814          (5) Except as provided in rule made by the commissioner in accordance with Title
             1815      63G, Chapter 3, Utah Administrative Rulemaking Act, in connection with a replacement
             1816      transaction, the producer shall submit to the insurer to which an application for a policy or
             1817      contract is presented:
             1818          (a) a copy of each document required by this section;
             1819          (b) a statement identifying any preprinted or electronically presented company
             1820      approved sales materials used; and
             1821          (c) copies of any individualized sales materials, including any illustrations related to


             1822      the specific policy or contract purchased.
             1823          Section 16. Section 31A-22-519 is amended to read:
             1824           31A-22-519. Death pending conversion.
             1825          If a person insured under a group life insurance policy, or the insured dependent of that
             1826      person, dies during the period of eligibility for conversion under Section 31A-22-517 or
             1827      31A-22-518 and before the individual policy becomes effective, the amount of life insurance to
             1828      which [he] the insured would have been entitled to have issued under the individual policy is
             1829      payable as a claim under the group policy, whether or not application for the individual policy
             1830      or the payment of the first premium has been made.
             1831          Section 17. Section 31A-22-612 is amended to read:
             1832           31A-22-612. Conversion privileges for insured former spouse.
             1833          (1) An accident and health insurance policy, which in addition to covering the insured
             1834      also provides coverage to the spouse of the insured, may not contain a provision for
             1835      termination of coverage of a spouse covered under the policy, except by entry of a valid decree
             1836      of divorce or annulment between the parties.
             1837          (2) Every policy which contains this type of provision shall provide that upon the entry
             1838      of the divorce decree the spouse is entitled to have issued an individual policy of accident and
             1839      health insurance without evidence of insurability, upon application to the company and
             1840      payment of the appropriate premium. The policy shall provide the coverage being issued
             1841      which is most nearly similar to the terminated coverage. Probationary or waiting periods in the
             1842      policy are considered satisfied to the extent the coverage was in force under the prior policy.
             1843          (3) When the insurer receives actual notice that the coverage of a spouse is to be
             1844      terminated because of a divorce or annulment, the insurer shall promptly provide the spouse
             1845      written notification of the right to obtain individual coverage as provided in Subsection (2), the
             1846      premium amounts required, and the manner, place, and time in which premiums may be paid.
             1847      The premium is determined in accordance with the insurer's table of premium rates applicable
             1848      to the age and class of risk of the persons to be covered and to the type and amount of coverage
             1849      provided. If the spouse applies and tenders the first monthly premium to the insurer within 30


             1850      days after receiving the notice provided by this subsection, the spouse shall receive individual
             1851      coverage that commences immediately upon termination of coverage under the insured's
             1852      policy.
             1853          (4) This section does not apply to accident and health insurance policies[: (a)] offered
             1854      on a group blanket basis[; or].
             1855          [(b) that comply with Section 31A-22-723 .]
             1856          Section 18. Section 31A-22-617 is amended to read:
             1857           31A-22-617. Preferred provider contract provisions.
             1858          Health insurance policies may provide for insureds to receive services or
             1859      reimbursement under the policies in accordance with preferred health care provider contracts as
             1860      follows:
             1861          (1) Subject to restrictions under this section, any insurer or third party administrator
             1862      may enter into contracts with health care providers as defined in Section 78B-3-403 under
             1863      which the health care providers agree to supply services, at prices specified in the contracts, to
             1864      persons insured by an insurer.
             1865          (a) (i) A health care provider contract may require the health care provider to accept the
             1866      specified payment as payment in full, relinquishing the right to collect additional amounts from
             1867      the insured person.
             1868          (ii) In any dispute involving a provider's claim for reimbursement, the same shall be
             1869      determined in accordance with applicable law, the provider contract, the subscriber contract,
             1870      and the insurer's written payment policies in effect at the time services were rendered.
             1871          (iii) If the parties are unable to resolve their dispute, the matter shall be subject to
             1872      binding arbitration by a jointly selected arbitrator. Each party is to bear its own expense except
             1873      the cost of the jointly selected arbitrator shall be equally shared. This Subsection (1)(a)(iii)
             1874      does not apply to the claim of a general acute hospital to the extent it is inconsistent with the
             1875      hospital's provider agreement.
             1876          (iv) An organization may not penalize a provider solely for pursuing a claims dispute
             1877      or otherwise demanding payment for a sum believed owing.


             1878          (v) If an insurer permits another entity with which it does not share common ownership
             1879      or control to use or otherwise lease one or more of the organization's networks of participating
             1880      providers, the organization shall ensure, at a minimum, that the entity pays participating
             1881      providers in accordance with the same fee schedule and general payment policies as the
             1882      organization would for that network.
             1883          (b) The insurance contract may reward the insured for selection of preferred health care
             1884      providers by:
             1885          (i) reducing premium rates;
             1886          (ii) reducing deductibles;
             1887          (iii) coinsurance;
             1888          (iv) other copayments; or
             1889          (v) any other reasonable manner.
             1890          (c) If the insurer is a managed care organization, as defined in Subsection
             1891      31A-27a-403 (1)(f):
             1892          (i) the insurance contract and the health care provider contract shall provide that in the
             1893      event the managed care organization becomes insolvent, the rehabilitator or liquidator may:
             1894          (A) require the health care provider to continue to provide health care services under
             1895      the contract until the earlier of:
             1896          (I) 90 days after the date of the filing of a petition for rehabilitation or the petition for
             1897      liquidation; or
             1898          (II) the date the term of the contract ends; and
             1899          (B) subject to Subsection (1)(c)(v), reduce the fees the provider is otherwise entitled to
             1900      receive from the managed care organization during the time period described in Subsection
             1901      (1)(c)(i)(A);
             1902          (ii) the provider is required to:
             1903          (A) accept the reduced payment under Subsection (1)(c)(i)(B) as payment in full; and
             1904          (B) relinquish the right to collect additional amounts from the insolvent managed care
             1905      organization's enrollee, as defined in Subsection 31A-27a-403 (1)(b);


             1906          (iii) if the contract between the health care provider and the managed care organization
             1907      has not been reduced to writing, or the contract fails to contain the language required by
             1908      Subsection (1)(c)(i), the provider may not collect or attempt to collect from the enrollee:
             1909          (A) sums owed by the insolvent managed care organization; or
             1910          (B) the amount of the regular fee reduction authorized under Subsection (1)(c)(i)(B);
             1911          (iv) the following may not bill or maintain any action at law against an enrollee to
             1912      collect sums owed by the insolvent managed care organization or the amount of the regular fee
             1913      reduction authorized under Subsection (1)(c)(i)(B):
             1914          (A) a provider;
             1915          (B) an agent;
             1916          (C) a trustee; or
             1917          (D) an assignee of a person described in Subsections (1)(c)(iv)(A) through (C); and
             1918          (v) notwithstanding Subsection (1)(c)(i):
             1919          (A) a rehabilitator or liquidator may not reduce a fee by less than 75% of the provider's
             1920      regular fee set forth in the contract; and
             1921          (B) the enrollee shall continue to pay the copayments, deductibles, and other payments
             1922      for services received from the provider that the enrollee was required to pay before the filing
             1923      of:
             1924          (I) a petition for rehabilitation; or
             1925          (II) a petition for liquidation.
             1926          (2) (a) Subject to Subsections (2)(b) through (2)[(f)](e), an insurer using preferred
             1927      health care provider contracts [shall pay for the services of health care providers not under the
             1928      contract, unless the illnesses or injuries treated by the health care provider are not within the
             1929      scope of the insurance contract. As used in this section, "class of health care providers" means
             1930      all health care providers licensed or licensed and certified by the state within the same
             1931      professional, trade, occupational, or facility licensure or licensure and certification category
             1932      established pursuant to Titles 26, Utah Health Code and 58, Occupations and Professions] is
             1933      subject to the reimbursement requirements in Section 31A-8-501 on or after January 1, 2014.


             1934          [(b) (i) Until July 1, 2012, when the insured receives services from a health care
             1935      provider not under contract, the insurer shall reimburse the insured for at least 75% of the
             1936      average amount paid by the insurer for comparable services of preferred health care providers
             1937      who are members of the same class of health care providers.]
             1938          [(ii) Notwithstanding Subsection (2)(b)(i), an insurer may offer a health plan that
             1939      complies with the provisions of Subsection 31A-22-618.5 (3).]
             1940          [(iii) The commissioner may adopt a rule dealing with the determination of what
             1941      constitutes 75% of the average amount paid by the insurer under Subsection (2)(b)(i) for
             1942      comparable services of preferred health care providers who are members of the same class of
             1943      health care providers.]
             1944          [(c)] (b) When reimbursing for services of health care providers not under contract, the
             1945      insurer may make direct payment to the insured.
             1946          [(d) Notwithstanding Subsection (2)(b), an]
             1947          (c) An insurer using preferred health care provider contracts may impose a deductible
             1948      on coverage of health care providers not under contract.
             1949          [(e)] (d) When selecting health care providers with whom to contract under Subsection
             1950      (1), an insurer may not unfairly discriminate between classes of health care providers, but may
             1951      discriminate within a class of health care providers, subject to Subsection (7).
             1952          [(f)] (e) For purposes of this section, unfair discrimination between classes of health
             1953      care providers [shall include] includes:
             1954          (i) refusal to contract with class members in reasonable proportion to the number of
             1955      insureds covered by the insurer and the expected demand for services from class members; and
             1956          (ii) refusal to cover procedures for one class of providers that are:
             1957          (A) commonly [utilized] used by members of the class of health care providers for the
             1958      treatment of illnesses, injuries, or conditions;
             1959          (B) otherwise covered by the insurer; and
             1960          (C) within the scope of practice of the class of health care providers.
             1961          (3) Before the insured consents to the insurance contract, the insurer shall fully disclose


             1962      to the insured that it has entered into preferred health care provider contracts. The insurer shall
             1963      provide sufficient detail on the preferred health care provider contracts to permit the insured to
             1964      agree to the terms of the insurance contract. The insurer shall provide at least the following
             1965      information:
             1966          (a) a list of the health care providers under contract, and if requested their business
             1967      locations and specialties;
             1968          (b) a description of the insured benefits, including any deductibles, coinsurance, or
             1969      other copayments;
             1970          (c) a description of the quality assurance program required under Subsection (4); and
             1971          (d) a description of the adverse benefit determination procedures required under
             1972      Subsection (5).
             1973          (4) (a) An insurer using preferred health care provider contracts shall maintain a quality
             1974      assurance program for assuring that the care provided by the health care providers under
             1975      contract meets prevailing standards in the state.
             1976          (b) The commissioner in consultation with the executive director of the Department of
             1977      Health may designate qualified persons to perform an audit of the quality assurance program.
             1978      The auditors shall have full access to all records of the organization and its health care
             1979      providers, including medical records of individual patients.
             1980          (c) The information contained in the medical records of individual patients shall
             1981      remain confidential. All information, interviews, reports, statements, memoranda, or other data
             1982      furnished for purposes of the audit and any findings or conclusions of the auditors are
             1983      privileged. The information is not subject to discovery, use, or receipt in evidence in any legal
             1984      proceeding except hearings before the commissioner concerning alleged violations of this
             1985      section.
             1986          (5) An insurer using preferred health care provider contracts shall provide a reasonable
             1987      procedure for resolving complaints and adverse benefit determinations initiated by the insureds
             1988      and health care providers.
             1989          (6) An insurer may not contract with a health care provider for treatment of illness or


             1990      injury unless the health care provider is licensed to perform that treatment.
             1991          (7) (a) A health care provider or insurer may not discriminate against a preferred health
             1992      care provider for agreeing to a contract under Subsection (1).
             1993          (b) Any health care provider licensed to treat any illness or injury within the scope of
             1994      the health care provider's practice, who is willing and able to meet the terms and conditions
             1995      established by the insurer for designation as a preferred health care provider, shall be able to
             1996      apply for and receive the designation as a preferred health care provider. Contract terms and
             1997      conditions may include reasonable limitations on the number of designated preferred health
             1998      care providers based upon substantial objective and economic grounds, or expected use of
             1999      particular services based upon prior provider-patient profiles.
             2000          (8) Upon the written request of a provider excluded from a provider contract, the
             2001      commissioner may hold a hearing to determine if the insurer's exclusion of the provider is
             2002      based on the criteria set forth in Subsection (7)(b).
             2003          (9) [Insurers] Except as provided in Subsection 31A-22-618.5 (3)(a), insurers are
             2004      subject to [the provisions of] Sections 31A-22-613.5 , 31A-22-614.5 , and 31A-22-618 .
             2005          (10) Nothing in this section is to be construed as to require an insurer to offer a certain
             2006      benefit or service as part of a health benefit plan.
             2007          (11) This section does not apply to catastrophic mental health coverage provided in
             2008      accordance with Section 31A-22-625 .
             2009          Section 19. Section 31A-22-618.5 is amended to read:
             2010           31A-22-618.5. Health benefit plan offerings.
             2011          (1) The purpose of this section is to increase the range of health benefit plans available
             2012      in the small group, small employer group, large group, and individual insurance markets.
             2013          (2) A health maintenance organization that is subject to Chapter 8, Health Maintenance
             2014      Organizations and Limited Health Plans:
             2015          (a) shall offer to potential purchasers at least one health benefit plan that is subject to
             2016      the requirements of Chapter 8, Health Maintenance Organizations and Limited Health Plans;
             2017      and


             2018          (b) may offer to a potential purchaser one or more health benefit plans that:
             2019          (i) are not subject to one or more of the following:
             2020          (A) the limitations on insured indemnity benefits in Subsection 31A-8-105 (4);
             2021          (B) the limitation on point of service products in Subsections 31A-8-408 (3) through
             2022      (6);
             2023          (C) except as provided in Subsection (2)(b)(ii), basic health care services as defined in
             2024      Section 31A-8-101 ; or
             2025          (D) coverage mandates enacted after January 1, 2009 that are not required by federal
             2026      law, provided that the insurer offers one plan under Subsection (2)(a) that covers the mandate
             2027      enacted after January 1, 2009; and
             2028          (ii) when offering a health plan under this section, provide coverage for an emergency
             2029      medical condition as required by Section 31A-22-627 as follows:
             2030          (A) within the organization's service area, covered services shall include health care
             2031      services from nonaffiliated providers when medically necessary to stabilize an emergency
             2032      medical condition; and
             2033          (B) outside the organization's service area, covered services shall include medically
             2034      necessary health care services for the treatment of an emergency medical condition that are
             2035      immediately required while the enrollee is outside the geographic limits of the organization's
             2036      service area.
             2037          (3) An insurer that offers a health benefit plan that is not subject to Chapter 8, Health
             2038      Maintenance Organizations and Limited Health Plans:
             2039          [(a) notwithstanding Subsection 31A-22-617 (2), may offer a health benefit plan that
             2040      groups providers into the following reimbursement levels:]
             2041          [(i) tier one contracted providers;]
             2042          [(ii) tier two contracted providers who the insurer shall reimburse at least 75% of tier
             2043      one providers; and]
             2044          [(iii) one or more tiers of non-contracted providers;]
             2045          [(b)] (a) notwithstanding Subsection 31A-22-617 (9), may offer a health benefit plan


             2046      that is not subject to Section 31A-22-618 ;
             2047          [(c) beginning July 1, 2012, may offer health benefit plans that:]
             2048          [(i) are not subject to Subsection 31A-22-617 (2); and]
             2049          [(ii) are subject to the reimbursement requirements in Section 31A-8-501 ;]
             2050          [(d)] (b) when offering a health plan under this Subsection (3), shall provide coverage
             2051      of emergency care services as required by Section 31A-22-627 [by providing coverage at a
             2052      reimbursement level of at least 75% of the health benefit plan's highest contracted provider
             2053      category]; and
             2054          [(e) are] (c) is not subject to coverage mandates enacted after January 1, 2009 that are
             2055      not required by federal law, provided that an insurer offers one plan that covers a mandate
             2056      enacted after January 1, 2009.
             2057          (4) Section 31A-8-106 does not prohibit the offer of a health benefit plan under
             2058      Subsection (2)(b).
             2059          (5) (a) Any difference in price between a health benefit plan offered under Subsections
             2060      (2)(a) and (b) shall be based on actuarially sound data.
             2061          (b) Any difference in price between a health benefit plan offered under [Subsections]
             2062      Subsection (3)(a) [and (b)] shall be based on actuarially sound data.
             2063          (6) Nothing in this section limits the number of health benefit plans that an insurer may
             2064      offer.
             2065          Section 20. Section 31A-22-722 is amended to read:
             2066           31A-22-722. Utah mini-COBRA benefits for employer group coverage.
             2067          (1) An insured may extend the employee's coverage under the current employer's group
             2068      policy for a period of 12 months, except as provided in Subsections (2) and 31A-22-722.5 (4).
             2069      The right to extend coverage includes:
             2070          (a) voluntary termination;
             2071          (b) involuntary termination;
             2072          (c) retirement;
             2073          (d) death;


             2074          (e) divorce or legal separation;
             2075          (f) loss of dependent status;
             2076          (g) sabbatical;
             2077          (h) a disability;
             2078          (i) leave of absence; or
             2079          (j) reduction of hours.
             2080          (2) (a) Notwithstanding Subsection (1), an employee may not extend coverage under
             2081      the current employer's group insurance policy if the employee:
             2082          (i) fails to pay premiums or contributions in accordance with the terms of the insurance
             2083      policy;
             2084          (ii) acquires other group coverage covering all preexisting conditions including
             2085      maternity, if the coverage exists;
             2086          (iii) performs an act or practice that constitutes fraud in connection with the coverage;
             2087          (iv) makes an intentional misrepresentation of material fact under the terms of the
             2088      coverage;
             2089          (v) is terminated from employment for gross misconduct;
             2090          (vi) is not continuously covered under the current employer's group policy for a period
             2091      of three months immediately before the termination of the insurance policy due to an event set
             2092      forth in Subsection (1);
             2093          (vii) is eligible for an extension of coverage required by federal law;
             2094          (viii) establishes residence outside of this state;
             2095          (ix) moves out of the insurer's service area;
             2096          (x) is eligible for similar coverage under another group insurance policy; or
             2097          (xi) has the employee's coverage terminated because the employer's coverage is
             2098      terminated, except as provided in Subsection (8)[; or].
             2099          [(xii) elects alternative coverage under Section 31A-22-724 .]
             2100          (b) The right to extend coverage under Subsection (1) applies to spouse or dependent
             2101      coverage, including a surviving spouse or dependents whose coverage under the insurance


             2102      policy terminates by reason of the death of the employee or member.
             2103          (3) (a) The employer shall notify the following in writing of the right to extend group
             2104      coverage and the payment amounts required for extension of coverage, including the manner,
             2105      place, and time in which the payments shall be made:
             2106          (i) a terminated insured;
             2107          (ii) an ex-spouse of an insured; or
             2108          (iii) if Subsection (2)(b) applies:
             2109          (A) a surviving spouse; and
             2110          (B) the guardian of surviving dependents, if different from a surviving spouse.
             2111          (b) The notification required in Subsection (3)(a) shall be sent first class mail within 30
             2112      days after the termination date of the group coverage to:
             2113          (i) the terminated insured's home address as shown on the records of the employer;
             2114          (ii) the address of the surviving spouse, if different from the insured's address and if
             2115      shown on the records of the employer;
             2116          (iii) the guardian of any dependents address, if different from the insured's address, and
             2117      if shown on the records of the employer; and
             2118          (iv) the address of the ex-spouse, if shown on the records of the employer.
             2119          (4) The insurer shall provide the employee, spouse, or any eligible dependent the
             2120      opportunity to extend the group coverage at the payment amount stated in Subsection (5) if:
             2121          (a) the employer policyholder does not provide the terminated insured the written
             2122      notification required by Subsection (3)(a); and
             2123          (b) the employee or other individual eligible for extension contacts the insurer within
             2124      60 days of coverage termination.
             2125          (5) A premium amount for extended group coverage may not exceed 102% of the
             2126      group rate in effect for a group member, including an employer's contribution, if any, for a
             2127      group insurance policy.
             2128          (6) Except as provided in this Subsection (6), coverage extends without interruption for
             2129      12 months and may not terminate if the terminated insured or, with respect to a minor, the


             2130      parent or guardian of the terminated insured:
             2131          (a) elects to extend group coverage within 60 days of losing group coverage; and
             2132          (b) tenders the amount required to the employer or insurer.
             2133          (7) The insured's coverage may be terminated before 12 months if the terminated
             2134      insured:
             2135          (a) establishes residence outside of this state;
             2136          (b) moves out of the insurer's service area;
             2137          (c) fails to pay premiums or contributions in accordance with the terms of the insurance
             2138      policy, including any timeliness requirements;
             2139          (d) performs an act or practice that constitutes fraud in connection with the coverage;
             2140          (e) makes an intentional misrepresentation of material fact under the terms of the
             2141      coverage;
             2142          (f) becomes eligible for similar coverage under another group insurance policy; or
             2143          (g) has the coverage terminated because the employer's coverage is terminated, except
             2144      as provided in Subsection (8).
             2145          (8) If the current employer coverage is terminated and the employer replaces coverage
             2146      with similar coverage under another group insurance policy, without interruption, the
             2147      terminated insured, spouse, or the surviving spouse and guardian of dependents if Subsection
             2148      (2)(b) applies, may obtain extension of coverage under the replacement group insurance policy:
             2149          (a) for the balance of the period the terminated insured would have extended coverage
             2150      under the replaced group insurance policy; and
             2151          (b) if the terminated insured is otherwise eligible for extension of coverage.
             2152          [(9) (a) Within 30 days of the insured's exhaustion of extension of coverage, the
             2153      employer shall provide the terminated insured and the ex-spouse, or, in the case of the death of
             2154      the insured, the surviving spouse, or guardian of any dependents, written notification of the
             2155      right to an individual conversion policy under Section 31A-22-723 .]
             2156          [(b) The notification required by Subsection (9)(a):]
             2157          [(i) shall be sent first class mail to:]


             2158          [(A) the insured's last-known address as shown on the records of the employer;]
             2159          [(B) the address of the surviving spouse, if different from the insured's address, and if
             2160      shown on the records of the employer;]
             2161          [(C) the guardian of any dependents last known address as shown on the records of the
             2162      employer, if different from the address of the surviving spouse; and]
             2163          [(D) the address of the ex-spouse as shown on the records of the employer, if
             2164      applicable; and]
             2165          [(ii) shall contain the name, address, and telephone number of the insurer that will
             2166      provide the conversion coverage.]
             2167          Section 21. Section 31A-23a-102 is amended to read:
             2168           31A-23a-102. Definitions.
             2169          As used in this chapter:
             2170          (1) "Bail bond producer" is as defined in Section 31A-35-102 .
             2171          [(2) "Escrow" means a license subline of authority in conjunction with the title
             2172      insurance line of authority that allows a person to conduct escrow as defined in Section
             2173      31A-1-301 .]
             2174          [(3)] (2) "Home state" means a state or territory of the United States or the District of
             2175      Columbia in which an insurance producer:
             2176          (a) maintains the insurance producer's principal:
             2177          (i) place of residence; or
             2178          (ii) place of business; and
             2179          (b) is licensed to act as an insurance producer.
             2180          [(4)] (3) "Insurer" is as defined in Section 31A-1-301 , except that the following
             2181      persons or similar persons are not insurers for purposes of Part 7, Producer Controlled Insurers:
             2182          (a) a risk retention group as defined in:
             2183          (i) the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499;
             2184          (ii) the Risk Retention Act, 15 U.S.C. Sec. 3901 et seq.; and
             2185          (iii) Chapter 15, Part 2, Risk Retention Groups Act;


             2186          (b) a residual market pool;
             2187          (c) a joint underwriting authority or association; and
             2188          (d) a captive insurer.
             2189          [(5)] (4) "License" is defined in Section 31A-1-301 .
             2190          [(6)] (5) (a) "Managing general agent" means a person that:
             2191          (i) manages all or part of the insurance business of an insurer, including the
             2192      management of a separate division, department, or underwriting office;
             2193          (ii) acts as an agent for the insurer whether it is known as a managing general agent,
             2194      manager, or other similar term;
             2195          (iii) produces and underwrites an amount of gross direct written premium equal to, or
             2196      more than 5% of, the policyholder surplus as reported in the last annual statement of the insurer
             2197      in any one quarter or year:
             2198          (A) with or without the authority;
             2199          (B) separately or together with an affiliate; and
             2200          (C) directly or indirectly; and
             2201          (iv) (A) adjusts or pays claims in excess of an amount determined by the
             2202      commissioner; or
             2203          (B) negotiates reinsurance on behalf of the insurer.
             2204          (b) Notwithstanding Subsection [(6)] (5)(a), the following persons may not be
             2205      considered as managing general agent for the purposes of this chapter:
             2206          (i) an employee of the insurer;
             2207          (ii) a United States manager of the United States branch of an alien insurer;
             2208          (iii) an underwriting manager that, pursuant to contract:
             2209          (A) manages all the insurance operations of the insurer;
             2210          (B) is under common control with the insurer;
             2211          (C) is subject to Chapter 16, Insurance Holding Companies; and
             2212          (D) is not compensated based on the volume of premiums written; and
             2213          (iv) the attorney-in-fact authorized by and acting for the subscribers of a reciprocal


             2214      insurer or inter-insurance exchange under powers of attorney.
             2215          [(7)] (6) "Negotiate" means the act of conferring directly with or offering advice
             2216      directly to a purchaser or prospective purchaser of a particular contract of insurance concerning
             2217      a substantive benefit, term, or condition of the contract if the person engaged in that act:
             2218          (a) sells insurance; or
             2219          (b) obtains insurance from insurers for purchasers.
             2220          [(8)] (7) "Reinsurance intermediary" means:
             2221          (a) a reinsurance intermediary-broker; or
             2222          (b) a reinsurance intermediary-manager.
             2223          [(9)] (8) "Reinsurance intermediary-broker" means a person other than an officer or
             2224      employee of the ceding insurer, firm, association, or corporation who solicits, negotiates, or
             2225      places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority
             2226      or power to bind reinsurance on behalf of the insurer.
             2227          [(10)] (9) (a) "Reinsurance intermediary-manager" means a person who:
             2228          (i) has authority to bind or who manages all or part of the assumed reinsurance
             2229      business of a reinsurer, including the management of a separate division, department, or
             2230      underwriting office; and
             2231          (ii) acts as an agent for the reinsurer whether the person is known as a reinsurance
             2232      intermediary-manager, manager, or other similar term.
             2233          (b) Notwithstanding Subsection [(10)] (9)(a), the following persons may not be
             2234      considered reinsurance intermediary-managers for the purpose of this chapter with respect to
             2235      the reinsurer:
             2236          (i) an employee of the reinsurer;
             2237          (ii) a United States manager of the United States branch of an alien reinsurer;
             2238          (iii) an underwriting manager that, pursuant to contract:
             2239          (A) manages all the reinsurance operations of the reinsurer;
             2240          (B) is under common control with the reinsurer;
             2241          (C) is subject to Chapter 16, Insurance Holding Companies; and


             2242          (D) is not compensated based on the volume of premiums written; and
             2243          (iv) the manager of a group, association, pool, or organization of insurers that:
             2244          (A) engage in joint underwriting or joint reinsurance; and
             2245          (B) are subject to examination by the insurance commissioner of the state in which the
             2246      manager's principal business office is located.
             2247          [(11)] (10) "Search" means a license subline of authority in conjunction with the title
             2248      insurance line of authority that allows a person to issue title insurance commitments or policies
             2249      on behalf of a title insurer.
             2250          [(12)] (11) "Sell" means to exchange a contract of insurance:
             2251          (a) by any means;
             2252          (b) for money or its equivalent; and
             2253          (c) on behalf of an insurance company.
             2254          [(13)] (12) "Solicit" means:
             2255          (a) attempting to sell insurance;
             2256          (b) asking or urging a person to apply for:
             2257          (i) a particular kind of insurance; and
             2258          (ii) insurance from a particular insurance company;
             2259          (c) advertising insurance, including advertising for the purpose of obtaining leads for
             2260      the sale of insurance; or
             2261          (d) holding oneself out as being in the insurance business.
             2262          [(14)] (13) "Terminate" means:
             2263          (a) the cancellation of the relationship between:
             2264          (i) an individual licensee or agency licensee and a particular insurer; or
             2265          (ii) an individual licensee and a particular agency licensee; or
             2266          (b) the termination of:
             2267          (i) an individual licensee's or agency licensee's authority to transact insurance on behalf
             2268      of a particular insurance company; or
             2269          (ii) an individual licensee's authority to transact insurance on behalf of a particular


             2270      agency licensee.
             2271          [(15)] (14) "Title marketing representative" means a person who:
             2272          (a) represents a title insurer in soliciting, requesting, or negotiating the placing of:
             2273          (i) title insurance; or
             2274          (ii) escrow services; and
             2275          (b) does not have a search or escrow license as provided in Section 31A-23a-106 .
             2276          [(16)] (15) "Uniform application" means the version of the National Association of
             2277      Insurance Commissioners' uniform application for resident and nonresident producer licensing
             2278      at the time the application is filed.
             2279          [(17)] (16) "Uniform business entity application" means the version of the National
             2280      Association of Insurance Commissioners' uniform business entity application for resident and
             2281      nonresident business entities at the time the application is filed.
             2282          Section 22. Section 31A-23a-105 is amended to read:
             2283           31A-23a-105. General requirements for individual and agency license issuance
             2284      and renewal.
             2285          (1) (a) The commissioner shall issue or renew a license to a person described in
             2286      Subsection (1)(b) to act as:
             2287          (i) a producer;
             2288          (ii) a surplus lines producer;
             2289          (iii) a limited line producer;
             2290          (iv) a consultant;
             2291          (v) a managing general agent; or
             2292          (vi) a reinsurance intermediary.
             2293          (b) The commissioner shall issue or renew a license under Subsection (1)(a) to a
             2294      person who, as to the license type and line of authority classification applied for under Section
             2295      31A-23a-106 :
             2296          (i) satisfies the application requirements under Section 31A-23a-104 ;
             2297          (ii) satisfies the character requirements under Section 31A-23a-107 ;


             2298          (iii) satisfies any applicable continuing education requirements under Section
             2299      31A-23a-202 ;
             2300          (iv) satisfies any applicable examination requirements under Section 31A-23a-108 ;
             2301          (v) satisfies any applicable training period requirements under Section 31A-23a-203 ;
             2302          (vi) if an applicant for a resident individual producer license, certifies that, to the extent
             2303      applicable, the applicant:
             2304          (A) is in compliance with Section 31A-23a-203.5 ; and
             2305          (B) will maintain compliance with Section 31A-23a-203.5 during the period for which
             2306      the license is issued or renewed;
             2307          (vii) has not committed an act that is a ground for denial, suspension, or revocation as
             2308      provided in Section 31A-23a-111 ;
             2309          (viii) if a nonresident:
             2310          (A) complies with Section 31A-23a-109 ; and
             2311          (B) holds an active similar license in that person's state of residence;
             2312          (ix) if an applicant for [a] an individual title insurance producer or agency title
             2313      insurance producer license, satisfies the requirements of Section 31A-23a-204 ;
             2314          (x) if an applicant for a license to act as a life settlement provider or life settlement
             2315      producer, satisfies the requirements of Section 31A-23a-117 ; and
             2316          (xi) pays the applicable fees under Section 31A-3-103 .
             2317          (2) (a) This Subsection (2) applies to the following persons:
             2318          (i) an applicant for a pending:
             2319          (A) individual or agency producer license;
             2320          (B) surplus lines producer license;
             2321          (C) limited line producer license;
             2322          (D) consultant license;
             2323          (E) managing general agent license; or
             2324          (F) reinsurance intermediary license; or
             2325          (ii) a licensed:


             2326          (A) individual or agency producer;
             2327          (B) surplus lines producer;
             2328          (C) limited line producer;
             2329          (D) consultant;
             2330          (E) managing general agent; or
             2331          (F) reinsurance intermediary.
             2332          (b) A person described in Subsection (2)(a) shall report to the commissioner:
             2333          (i) an administrative action taken against the person, including a denial of a new or
             2334      renewal license application:
             2335          (A) in another jurisdiction; or
             2336          (B) by another regulatory agency in this state; and
             2337          (ii) a criminal prosecution taken against the person in any jurisdiction.
             2338          (c) The report required by Subsection (2)(b) shall:
             2339          (i) be filed:
             2340          (A) at the time the person files the application for an individual or agency license; and
             2341          (B) for an action or prosecution that occurs on or after the day on which the person
             2342      files the application:
             2343          (I) for an administrative action, within 30 days of the final disposition of the
             2344      administrative action; or
             2345          (II) for a criminal prosecution, within 30 days of the initial appearance before a court;
             2346      and
             2347          (ii) include a copy of the complaint or other relevant legal documents related to the
             2348      action or prosecution described in Subsection (2)(b).
             2349          (3) (a) The department may require a person applying for a license or for consent to
             2350      engage in the business of insurance to submit to a criminal background check as a condition of
             2351      receiving a license or consent.
             2352          (b) A person, if required to submit to a criminal background check under Subsection
             2353      (3)(a), shall:


             2354          (i) submit a fingerprint card in a form acceptable to the department; and
             2355          (ii) consent to a fingerprint background check by:
             2356          (A) the Utah Bureau of Criminal Identification; and
             2357          (B) the Federal Bureau of Investigation.
             2358          (c) For a person who submits a fingerprint card and consents to a fingerprint
             2359      background check under Subsection (3)(b), the department may request:
             2360          (i) criminal background information maintained pursuant to Title 53, Chapter 10, Part
             2361      2, Bureau of Criminal Identification, from the Bureau of Criminal Identification; and
             2362          (ii) complete Federal Bureau of Investigation criminal background checks through the
             2363      national criminal history system.
             2364          (d) Information obtained by the department from the review of criminal history records
             2365      received under this Subsection (3) shall be used by the department for the purposes of:
             2366          (i) determining if a person satisfies the character requirements under Section
             2367      31A-23a-107 for issuance or renewal of a license;
             2368          (ii) determining if a person has failed to maintain the character requirements under
             2369      Section 31A-23a-107 ; and
             2370          (iii) preventing a person who violates the federal Violent Crime Control and Law
             2371      Enforcement Act of 1994, 18 U.S.C. Sec. 1033, from engaging in the business of insurance in
             2372      the state.
             2373          (e) If the department requests the criminal background information, the department
             2374      shall:
             2375          (i) pay to the Department of Public Safety the costs incurred by the Department of
             2376      Public Safety in providing the department criminal background information under Subsection
             2377      (3)(c)(i);
             2378          (ii) pay to the Federal Bureau of Investigation the costs incurred by the Federal Bureau
             2379      of Investigation in providing the department criminal background information under
             2380      Subsection (3)(c)(ii); and
             2381          (iii) charge the person applying for a license or for consent to engage in the business of


             2382      insurance a fee equal to the aggregate of Subsections (3)(e)(i) and (ii).
             2383          (4) To become a resident licensee in accordance with Section 31A-23a-104 and this
             2384      section, a person licensed as one of the following in another state who moves to this state shall
             2385      apply within 90 days of establishing legal residence in this state:
             2386          (a) insurance producer;
             2387          (b) surplus lines producer;
             2388          (c) limited line producer;
             2389          (d) consultant;
             2390          (e) managing general agent; or
             2391          (f) reinsurance intermediary.
             2392          (5) (a) The commissioner may deny a license application for a license listed in
             2393      Subsection (5)(b) if the person applying for the license, as to the license type and line of
             2394      authority classification applied for under Section 31A-23a-106 :
             2395          (i) fails to satisfy the requirements as set forth in this section; or
             2396          (ii) commits an act that is grounds for denial, suspension, or revocation as set forth in
             2397      Section 31A-23a-111 .
             2398          (b) This Subsection (5) applies to the following licenses:
             2399          (i) producer;
             2400          (ii) surplus lines producer;
             2401          (iii) limited line producer;
             2402          (iv) consultant;
             2403          (v) managing general agent; or
             2404          (vi) reinsurance intermediary.
             2405          (6) Notwithstanding the other provisions of this section, the commissioner may:
             2406          (a) issue a license to an applicant for a license for a title insurance line of authority only
             2407      with the concurrence of the Title and Escrow Commission; and
             2408          (b) renew a license for a title insurance line of authority only with the concurrence of
             2409      the Title and Escrow Commission.


             2410          Section 23. Section 31A-23a-106 is amended to read:
             2411           31A-23a-106. License types.
             2412          (1) (a) A resident or nonresident license issued under this chapter shall be issued under
             2413      the license types described under Subsection (2).
             2414          (b) A license type and a line of authority pertaining to a license type describe the type
             2415      of licensee and the lines of business that a licensee may sell, solicit, or negotiate. A license
             2416      type is intended to describe the matters to be considered under any education, examination, and
             2417      training required of a license applicant under Sections 31A-23a-108 , 31A-23a-202 , and
             2418      31A-23a-203 .
             2419          (2) (a) A producer license type includes the following lines of authority:
             2420          (i) life insurance, including a nonvariable contract;
             2421          (ii) variable contracts, including variable life and annuity, if the producer has the life
             2422      insurance line of authority;
             2423          (iii) accident and health insurance, including a contract issued to a policyholder under
             2424      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
             2425      Organizations and Limited Health Plans;
             2426          (iv) property insurance;
             2427          (v) casualty insurance, including a surety or other bond;
             2428          (vi) title insurance under one or more of the following categories:
             2429          (A) search, including authority to act as a title marketing representative;
             2430          (B) escrow, including authority to act as a title marketing representative; and
             2431          (C) title marketing representative only; and
             2432          (vii) personal lines insurance.
             2433          (b) A surplus lines producer license type includes the following lines of authority:
             2434          (i) property insurance, if the person holds an underlying producer license with the
             2435      property line of insurance; and
             2436          (ii) casualty insurance, if the person holds an underlying producer license with the
             2437      casualty line of authority.


             2438          (c) A limited line producer license type includes the following limited lines of
             2439      authority:
             2440          (i) limited line credit insurance;
             2441          (ii) travel insurance;
             2442          (iii) motor club insurance;
             2443          (iv) car rental related insurance;
             2444          (v) legal expense insurance;
             2445          (vi) crop insurance;
             2446          (vii) self-service storage insurance;
             2447          (viii) bail bond producer;
             2448          (ix) guaranteed asset protection waiver; and
             2449          (x) portable electronics insurance.
             2450          (d) A consultant license type includes the following lines of authority:
             2451          (i) life insurance, including a nonvariable contract;
             2452          (ii) variable contracts, including variable life and annuity, if the consultant has the life
             2453      insurance line of authority;
             2454          (iii) accident and health insurance, including a contract issued to a policyholder under
             2455      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
             2456      Organizations and Limited Health Plans;
             2457          (iv) property insurance;
             2458          (v) casualty insurance, including a surety or other bond; and
             2459          (vi) personal lines insurance.
             2460          (e) A managing general agent license type includes the following lines of authority:
             2461          (i) life insurance, including a nonvariable contract;
             2462          (ii) variable contracts, including variable life and annuity, if the managing general
             2463      agent has the life insurance line of authority;
             2464          (iii) accident and health insurance, including a contract issued to a policyholder under
             2465      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance


             2466      Organizations and Limited Health Plans;
             2467          (iv) property insurance;
             2468          (v) casualty insurance, including a surety or other bond; and
             2469          (vi) personal lines insurance.
             2470          (f) A reinsurance intermediary license type includes the following lines of authority:
             2471          (i) life insurance, including a nonvariable contract;
             2472          (ii) variable contracts, including variable life and annuity, if the reinsurance
             2473      intermediary has the life insurance line of authority;
             2474          (iii) accident and health insurance, including a contract issued to a policyholder under
             2475      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
             2476      Organizations and Limited Health Plans;
             2477          (iv) property insurance;
             2478          (v) casualty insurance, including a surety or other bond; and
             2479          (vi) personal lines insurance.
             2480          (g) A person who holds a license under Subsection (2)(a) has the qualifications
             2481      necessary to act as a holder of a license under Subsection (2)(c), except that the person may not
             2482      act under Subsection (2)(c)(viii) or (ix).
             2483          (3) (a) The commissioner may by rule recognize other producer, surplus lines producer,
             2484      limited line producer, consultant, managing general agent, or reinsurance intermediary lines of
             2485      authority as to kinds of insurance not listed under Subsections (2)(a) through (f).
             2486          (b) Notwithstanding Subsection (3)(a), for purposes of title insurance the Title and
             2487      Escrow Commission may by rule, with the concurrence of the commissioner and subject to
             2488      Section 31A-2-404 , recognize other categories for [a] an individual title insurance producer or
             2489      agency title insurance producer line of authority not listed under Subsection (2)(a)(vi).
             2490          (4) The variable contracts line of authority requires:
             2491          (a) for a producer, licensure by the Financial Industry Regulatory Authority as a:
             2492          (i) registered broker-dealer; or
             2493          (ii) broker-dealer agent, with a current registration with a broker-dealer; and


             2494          (b) for a consultant, registration with the Securities and Exchange Commission or
             2495      licensure by the Utah Division of Securities as an:
             2496          (i) investment adviser; or
             2497          (ii) investment adviser representative, with a current association with an investment
             2498      adviser.
             2499          (5) A surplus lines producer is a producer who has a surplus lines license.
             2500          Section 24. Section 31A-23a-118 is enacted to read:
             2501          31A-23a-118. Car rental related licensing requirements.
             2502          (1) Subject to Section 31A-23a-103 , a person is required to hold a limited line
             2503      producer license with a car rental related insurance limited line of authority to sell or offer car
             2504      rental related insurance coverage under a car rental related insurance policy.
             2505          (2) A car rental related insurance limited line license issued pursuant to Sections
             2506      31A-23a-103 and 31A-23a-106 authorizes an employee or authorized representative of the
             2507      licensee to sell or offer coverage under a car rental related insurance policy to a customer at
             2508      each location at which the licensee engages in car rental related insurance transactions.
             2509          (3) An agency holding a car rental related insurance limited line license shall:
             2510          (a) be appointed by an insurer underwriting a car rental related insurance policy that the
             2511      agency sells or offers; and
             2512          (b) have a designated responsible licensed individual at each location at which the
             2513      agency is soliciting, selling, or offering car rental related insurance.
             2514          (4) An agency holding a car rental related insurance limited line license may employ a
             2515      nonlicensed individual employed as a counter sales representative in soliciting, selling, or
             2516      offering car rental related insurance. The nonlicensed individual shall be:
             2517          (a) trained and supervised in the sale of car rental related insurance products; and
             2518          (b) responsible to a licensed individual designated by the agency at each location where
             2519      a car rental related insurance product is sold.
             2520          Section 25. Section 31A-23a-202 is amended to read:
             2521           31A-23a-202. Continuing education requirements.


             2522          (1) Pursuant to this section, the commissioner shall by rule prescribe the continuing
             2523      education requirements for a producer and a consultant.
             2524          (2) (a) The commissioner may not state a continuing education requirement in terms of
             2525      formal education.
             2526          (b) The commissioner may state a continuing education requirement in terms of hours
             2527      of insurance-related instruction received.
             2528          (c) Insurance-related formal education may be a substitute, in whole or in part, for the
             2529      hours required under Subsection (2)(b).
             2530          (3) (a) The commissioner shall impose continuing education requirements in
             2531      accordance with a two-year licensing period in which the licensee meets the requirements of
             2532      this Subsection (3).
             2533          (b) (i) Except as provided in this section, the continuing education requirements shall
             2534      require:
             2535          (A) that a licensee complete 24 credit hours of continuing education for every two-year
             2536      licensing period;
             2537          (B) that 3 of the 24 credit hours described in Subsection (3)(b)(i)(A) be ethics courses;
             2538      and
             2539          (C) that the licensee complete at least half of the required hours through classroom
             2540      hours of insurance-related instruction.
             2541          (ii) An hour of continuing education in accordance with Subsection (3)(b)(i) may be
             2542      obtained through:
             2543          (A) classroom attendance;
             2544          (B) home study;
             2545          (C) watching a video recording;
             2546          (D) experience credit; or
             2547          (E) another method provided by rule.
             2548          (iii) (A) Notwithstanding Subsections (3)(b)(i)(A) and (B), [a] an individual title
             2549      insurance producer is required to complete 12 credit hours of continuing education for every


             2550      two-year licensing period, with 3 of the credit hours being ethics courses unless the individual
             2551      title insurance producer is licensed in this state as [a] an individual title insurance producer for
             2552      20 or more consecutive years.
             2553          (B) If [a] an individual title insurance producer is licensed in this state as [a] an
             2554      individual title insurance producer for 20 or more consecutive years, the individual title
             2555      insurance producer is required to complete 6 credit hours of continuing education for every
             2556      two-year licensing period, with 3 of the credit hours being ethics courses.
             2557          (C) Notwithstanding Subsection (3)(b)(iii)(A) or (B), [a] an individual title insurance
             2558      producer is considered to have met the continuing education requirements imposed under
             2559      Subsection (3)(b)(iii)(A) or (B) if the individual title insurance producer:
             2560          (I) is an active member in good standing with the Utah State Bar;
             2561          (II) is in compliance with the continuing education requirements of the Utah State Bar;
             2562      and
             2563          (III) if requested by the department, provides the department evidence that the
             2564      individual title insurance producer complied with the continuing education requirements of the
             2565      Utah State Bar.
             2566          (c) A licensee may obtain continuing education hours at any time during the two-year
             2567      licensing period.
             2568          (d) (i) A licensee is exempt from continuing education requirements under this section
             2569      if:
             2570          (A) the licensee was first licensed before April 1, 1978;
             2571          (B) the license does not have a continuous lapse for a period of more than one year,
             2572      except for a license for which the licensee has had an exemption approved before May 11,
             2573      2011;
             2574          (C) the licensee requests an exemption from the department; and
             2575          (D) the department approves the exemption.
             2576          (ii) If the department approves the exemption under Subsection (3)(d)(i), the licensee is
             2577      not required to apply again for the exemption.


             2578          (e) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2579      commissioner shall, by rule:
             2580          (i) publish a list of insurance professional designations whose continuing education
             2581      requirements can be used to meet the requirements for continuing education under Subsection
             2582      (3)(b);
             2583          (ii) authorize a continuing education provider or a state or national professional
             2584      producer or consultant association to:
             2585          (A) offer a qualified program for a license type or line of authority on a geographically
             2586      accessible basis; and
             2587          (B) collect a reasonable fee for funding and administration of a continuing education
             2588      program, subject to the review and approval of the commissioner; and
             2589          (iii) provide that membership by a producer or consultant in a state or national
             2590      professional producer or consultant association is considered a substitute for the equivalent of
             2591      two hours for each year during which the producer or consultant is a member of the
             2592      professional association, except that the commissioner may not give more than two hours of
             2593      continuing education credit in a year regardless of the number of professional associations of
             2594      which the producer or consultant is a member.
             2595          (f) A fee permitted under Subsection (3)(e)(ii)(B) that is charged for attendance at a
             2596      professional producer or consultant association program may be less for an association
             2597      member, on the basis of the member's affiliation expense, but shall preserve the right of a
             2598      nonmember to attend without affiliation.
             2599          (4) The commissioner shall approve a continuing education provider or continuing
             2600      education course that satisfies the requirements of this section.
             2601          (5) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             2602      commissioner shall by rule set the processes and procedures for continuing education provider
             2603      registration and course approval.
             2604          (6) The requirements of this section apply only to a producer or consultant who is an
             2605      individual.


             2606          (7) A nonresident producer or consultant is considered to have satisfied this state's
             2607      continuing education requirements if the nonresident producer or consultant satisfies the
             2608      nonresident producer's or consultant's home state's continuing education requirements for a
             2609      licensed insurance producer or consultant.
             2610          (8) A producer or consultant subject to this section shall keep documentation of
             2611      completing the continuing education requirements of this section for two years after the end of
             2612      the two-year licensing period to which the continuing education applies.
             2613          Section 26. Section 31A-23a-203.5 is amended to read:
             2614           31A-23a-203.5. Errors and omissions coverage requirements.
             2615          (1) In accordance with this section, a resident individual producer shall ensure that the
             2616      resident individual producer is covered:
             2617          (a) for the legal liability of the resident individual producer as the result of an
             2618      erroneous act or failure to act in the resident individual producer's capacity as a producer; and
             2619          (b) at all times during the term of the resident individual producer's license.
             2620          (2) The coverage required by Subsection (1) shall consist of:
             2621          (a) a policy naming the resident individual producer;
             2622          (b) a policy naming the agency that designates the resident individual producer in
             2623      accordance with this chapter; or
             2624          (c) a written agreement by an insurer or group of affiliated insurers, on behalf of a
             2625      resident individual producer who is or will become an exclusive agent of the insurer or group
             2626      of affiliated insurers, under which the insurer or group of affiliated insurers agrees to assume
             2627      responsibility, to the benefit of an aggrieved person, for legal liability of the resident individual
             2628      producer as the result of an erroneous act or failure to act in the resident individual producer's
             2629      capacity as a producer for the insurer or group of affiliated insurers.
             2630          (3) The commissioner may, by rule made in accordance with Title 63G, Chapter 3,
             2631      Utah Administrative Rulemaking Act, provide for:
             2632          (a) the terms and conditions of the coverage required under Subsection (1); and
             2633          (b) if the coverage required by Subsection (1) is terminated during a resident individual


             2634      producer's license term, requirements to:
             2635          (i) provide notice; and
             2636          (ii) replace the coverage.
             2637          (4) [A] An individual title insurance producer is considered to be in compliance with
             2638      this section [if the] when:
             2639          (a) the individual title insurance producer is not designated by an agency title producer
             2640      and maintains [a] the individual title insurance producer's own bond, policy, or other financial
             2641      protection in accordance with Subsection 31A-23a-204 (2)[.]; or
             2642          (b) the individual title insurance producer is designated by an agency title insurance
             2643      producer that maintains a bond, policy, or other financial protection in accordance with
             2644      Subsection 31A-23a-204 (2).
             2645          (5) Notwithstanding the other provisions of this section, a resident individual producer
             2646      is exempt from the requirement to maintain coverage as provided in this section during a
             2647      period in which the resident individual producer is not either:
             2648          (a) appointed by an insurer under this title; or
             2649          (b) designated by an agency under this title.
             2650          (6) A limited lines producer is exempt from this section.
             2651          Section 27. Section 31A-23a-204 is amended to read:
             2652           31A-23a-204. Special requirements for title insurance producers and agencies.
             2653          [A] An individual title insurance producer or agency title insurance producer[,
             2654      including an agency,] shall be licensed in accordance with this chapter, with the additional
             2655      requirements listed in this section.
             2656          (1) (a) A person that receives a new license under this title as [a] an agency title
             2657      insurance [agency,] producer shall at the time of licensure be owned or managed by at least one
             2658      individual who is licensed for at least three of the five years immediately preceding the date on
             2659      which the agency title insurance [agency] producer applies for a license with both:
             2660          (i) a search line of authority; and
             2661          (ii) an escrow line of authority.


             2662          (b) [A] An agency title insurance [agency] producer subject to Subsection (1)(a) may
             2663      comply with Subsection (1)(a) by having the agency title insurance [agency] producer owned or
             2664      managed by:
             2665          (i) one or more individuals who are licensed with the search line of authority for the
             2666      time period provided in Subsection (1)(a); and
             2667          (ii) one or more individuals who are licensed with the escrow line of authority for the
             2668      time period provided in Subsection (1)(a).
             2669          (c) A person licensed as [a] an agency title insurance [agency] producer shall at all
             2670      times during the term of licensure be owned or managed by at least one individual who is
             2671      licensed for at least three years within the preceding five-year period with both:
             2672          (i) a search line of authority; and
             2673          (ii) an escrow line of authority.
             2674          (d) The Title and Escrow Commission may by rule, subject to Section 31A-2-404 ,
             2675      exempt an attorney with real estate experience from the experience requirements in Subsection
             2676      (1)(a).
             2677          (e) An individual who satisfies the requirements of this Subsection (1) is known as a
             2678      "qualifying licensee." At any given time, an individual may be a qualifying licensee for not
             2679      more than two agency title insurance producers.
             2680          (2) (a) [A] An individual title insurance producer or agency title insurance [agency or]
             2681      producer appointed by an insurer shall maintain:
             2682          (i) a fidelity bond;
             2683          (ii) a professional liability insurance policy; or
             2684          (iii) a financial protection:
             2685          (A) equivalent to that described in Subsection (2)(a)(i) or (ii); and
             2686          (B) that the commissioner considers adequate.
             2687          (b) The bond, insurance, or financial protection required by this Subsection (2):
             2688          (i) shall be supplied under a contract approved by the commissioner to provide
             2689      protection against the improper performance of any service in conjunction with the issuance of


             2690      a contract or policy of title insurance; and
             2691          (ii) be in a face amount no less than $50,000.
             2692          (c) The Title and Escrow Commission may by rule, subject to Section 31A-2-404 ,
             2693      exempt individual title insurance producer or agency title insurance producers from the
             2694      requirements of this Subsection (2) upon a finding that, and only so long as, the required policy
             2695      or bond is generally unavailable at reasonable rates.
             2696          (3) [A] An individual title insurance producer or agency title insurance [agency or]
             2697      producer appointed by an insurer may maintain a reserve fund to the extent money was
             2698      deposited before July 1, 2008, and not withdrawn to the income of the individual title insurance
             2699      producer or agency title insurance producer.
             2700          (4) An examination for licensure shall include questions regarding the search and
             2701      examination of title to real property.
             2702          (5) [A] An individual title insurance producer may not perform the functions of escrow
             2703      unless the individual title insurance producer has been examined on the fiduciary duties and
             2704      procedures involved in those functions.
             2705          (6) The Title and Escrow Commission [shall] may adopt rules, subject to Section
             2706      31A-2-404 , after consulting with the [department] commissioner and the [department's]
             2707      commissioner's test administrator, establishing an examination for a license that will satisfy
             2708      this section.
             2709          (7) A license may be issued to [a] an individual title insurance producer or agency title
             2710      insurance producer who has qualified:
             2711          (a) to perform only searches and examinations of title as specified in Subsection (4);
             2712          (b) to handle only escrow arrangements as specified in Subsection (5); or
             2713          (c) to act as a title marketing representative.
             2714          (8) (a) A person licensed to practice law in Utah is exempt from the requirements of
             2715      Subsections (2) and (3) if that person issues 12 or less policies in any 12-month period.
             2716          (b) In determining the number of policies issued by a person licensed to practice law in
             2717      Utah for purposes of Subsection (8)(a), if the person licensed to practice law in Utah issues a


             2718      policy to more than one party to the same closing, the person is considered to have issued only
             2719      one policy.
             2720          (9) A person licensed to practice law in Utah, whether exempt under Subsection (8) or
             2721      not, shall maintain a trust account separate from a law firm trust account for all title and real
             2722      estate escrow transactions.
             2723          Section 28. Section 31A-23a-402 is amended to read:
             2724           31A-23a-402. Unfair marketing practices -- Communication -- Unfair
             2725      discrimination -- Coercion or intimidation -- Restriction on choice.
             2726          (1) (a) (i) Any of the following may not make or cause to be made any communication
             2727      that contains false or misleading information, relating to an insurance product or contract, any
             2728      insurer, or any licensee under this title, including information that is false or misleading
             2729      because it is incomplete:
             2730          (A) a person who is or should be licensed under this title;
             2731          (B) an employee or producer of a person described in Subsection (1)(a)(i)(A);
             2732          (C) a person whose primary interest is as a competitor of a person licensed under this
             2733      title; and
             2734          (D) a person on behalf of any of the persons listed in this Subsection (1)(a)(i).
             2735          (ii) As used in this Subsection (1), "false or misleading information" includes:
             2736          (A) assuring the nonobligatory payment of future dividends or refunds of unused
             2737      premiums in any specific or approximate amounts, but reporting fully and accurately past
             2738      experience is not false or misleading information; and
             2739          (B) with intent to deceive a person examining it:
             2740          (I) filing a report;
             2741          (II) making a false entry in a record; or
             2742          (III) wilfully refraining from making a proper entry in a record.
             2743          (iii) A licensee under this title may not:
             2744          (A) use any business name, slogan, emblem, or related device that is misleading or
             2745      likely to cause the insurer or other licensee to be mistaken for another insurer or other licensee


             2746      already in business; or
             2747          (B) use any advertisement or other insurance promotional material that would cause a
             2748      reasonable person to mistakenly believe that a state or federal government agency, including
             2749      the Health Insurance Exchange, also called the "Utah Health Exchange," created in Section
             2750      63M-1-2504 , the Comprehensive Health Insurance Pool created in Chapter 29, Comprehensive
             2751      Health Insurance Pool Act, and the Children's Health Insurance Program created in Title 26,
             2752      Chapter 40, Utah Children's Health Insurance Act:
             2753          (I) is responsible for the insurance sales activities of the person;
             2754          (II) stands behind the credit of the person;
             2755          (III) guarantees any returns on insurance products of or sold by the person; or
             2756          (IV) is a source of payment of any insurance obligation of or sold by the person.
             2757          (iv) A person who is not an insurer may not assume or use any name that deceptively
             2758      implies or suggests that person is an insurer.
             2759          (v) A person other than persons licensed as health maintenance organizations under
             2760      Chapter 8 may not use the term "Health Maintenance Organization" or "HMO" in referring to
             2761      itself.
             2762          (b) A licensee's violation creates a rebuttable presumption that the violation was also
             2763      committed by the insurer if:
             2764          (i) the licensee under this title distributes cards or documents, exhibits a sign, or
             2765      publishes an advertisement that violates Subsection (1)(a), with reference to a particular
             2766      insurer:
             2767          (A) that the licensee represents; or
             2768          (B) for whom the licensee processes claims; and
             2769          (ii) the cards, documents, signs, or advertisements are supplied or approved by that
             2770      insurer.
             2771          (2) (a) A title insurer [or], individual title insurance producer, or agency title insurance
             2772      producer or any officer or employee of [either] the title insurer, individual title insurance
             2773      producer, or agency title insurance producer may not pay, allow, give, or offer to pay, allow, or


             2774      give, directly or indirectly, as an inducement to obtaining any title insurance business:
             2775          (i) any rebate, reduction, or abatement of any rate or charge made incident to the
             2776      issuance of the title insurance;
             2777          (ii) any special favor or advantage not generally available to others; [or]
             2778          (iii) any money or other consideration, except if approved under Section 31A-2-405 ; or
             2779          (iv) material inducement.
             2780          (b) "Charge made incident to the issuance of the title insurance" includes escrow
             2781      charges, and any other services that are prescribed in rule by the Title and Escrow Commission
             2782      after consultation with the commissioner and subject to Section 31A-2-404 .
             2783          (c) An insured or any other person connected, directly or indirectly, with the
             2784      transaction may not knowingly receive or accept, directly or indirectly, any benefit referred to
             2785      in Subsection (2)(a), including:
             2786          (i) a person licensed under Title 61, Chapter 2c, Utah Residential Mortgage Practices
             2787      and Licensing Act;
             2788          (ii) a person licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices
             2789      Act;
             2790          (iii) a builder;
             2791          (iv) an attorney; or
             2792          (v) an officer, employee, or agent of a person listed in this Subsection (2)(c)(iii).
             2793          (3) (a) An insurer may not unfairly discriminate among policyholders by charging
             2794      different premiums or by offering different terms of coverage, except on the basis of
             2795      classifications related to the nature and the degree of the risk covered or the expenses involved.
             2796          (b) Rates are not unfairly discriminatory if they are averaged broadly among persons
             2797      insured under a group, blanket, or franchise policy, and the terms of those policies are not
             2798      unfairly discriminatory merely because they are more favorable than in similar individual
             2799      policies.
             2800          (4) (a) This Subsection (4) applies to:
             2801          (i) a person who is or should be licensed under this title;


             2802          (ii) an employee of that licensee or person who should be licensed;
             2803          (iii) a person whose primary interest is as a competitor of a person licensed under this
             2804      title; and
             2805          (iv) one acting on behalf of any person described in Subsections (4)(a)(i) through (iii).
             2806          (b) A person described in Subsection (4)(a) may not commit or enter into any
             2807      agreement to participate in any act of boycott, coercion, or intimidation that:
             2808          (i) tends to produce:
             2809          (A) an unreasonable restraint of the business of insurance; or
             2810          (B) a monopoly in that business; or
             2811          (ii) results in an applicant purchasing or replacing an insurance contract.
             2812          (5) (a) (i) Subject to Subsection (5)(a)(ii), a person may not restrict in the choice of an
             2813      insurer or licensee under this chapter, another person who is required to pay for insurance as a
             2814      condition for the conclusion of a contract or other transaction or for the exercise of any right
             2815      under a contract.
             2816          (ii) A person requiring coverage may reserve the right to disapprove the insurer or the
             2817      coverage selected on reasonable grounds.
             2818          (b) The form of corporate organization of an insurer authorized to do business in this
             2819      state is not a reasonable ground for disapproval, and the commissioner may by rule specify
             2820      additional grounds that are not reasonable. This Subsection (5) does not bar an insurer from
             2821      declining an application for insurance.
             2822          (6) A person may not make any charge other than insurance premiums and premium
             2823      financing charges for the protection of property or of a security interest in property, as a
             2824      condition for obtaining, renewing, or continuing the financing of a purchase of the property or
             2825      the lending of money on the security of an interest in the property.
             2826          (7) (a) A licensee under this title may not refuse or fail to return promptly all indicia of
             2827      agency to the principal on demand.
             2828          (b) A licensee whose license is suspended, limited, or revoked under Section
             2829      31A-2-308 , 31A-23a-111 , or 31A-23a-112 may not refuse or fail to return the license to the


             2830      commissioner on demand.
             2831          (8) (a) A person may not engage in an unfair method of competition or any other unfair
             2832      or deceptive act or practice in the business of insurance, as defined by the commissioner by
             2833      rule, after a finding that the method of competition, the act, or the practice:
             2834          (i) is misleading;
             2835          (ii) is deceptive;
             2836          (iii) is unfairly discriminatory;
             2837          (iv) provides an unfair inducement; or
             2838          (v) unreasonably restrains competition.
             2839          (b) Notwithstanding Subsection (8)(a), for purpose of the title insurance industry, the
             2840      Title and Escrow Commission shall make rules, subject to Section 31A-2-404 , that define an
             2841      unfair method of competition or unfair or deceptive act or practice after a finding that the
             2842      method of competition, the act, or the practice:
             2843          (i) is misleading;
             2844          (ii) is deceptive;
             2845          (iii) is unfairly discriminatory;
             2846          (iv) provides an unfair inducement; or
             2847          (v) unreasonably restrains competition.
             2848          Section 29. Section 31A-23a-402.5 is amended to read:
             2849           31A-23a-402.5. Inducements.
             2850          (1) (a) Except as provided in Subsection (2), a producer, consultant, or other licensee
             2851      under this title, or an officer or employee of a licensee, may not induce a person to enter into,
             2852      continue, or terminate an insurance contract by offering a benefit that is not:
             2853          (i) specified in the insurance contract; or
             2854          (ii) directly related to the insurance contract.
             2855          (b) An insurer may not make or knowingly allow an agreement of insurance that is not
             2856      clearly expressed in the insurance contract to be issued or renewed.
             2857          (c) A licensee under this title may not absorb the tax under Section 31A-3-301 .


             2858          (2) This section does not apply to a title insurer, [a title] an individual title insurance
             2859      producer, or agency title insurance producer, or an officer or employee of a title insurer [or
             2860      title], an individual title insurance producer, or an agency title insurance producer.
             2861          (3) Items not prohibited by Subsection (1) include an insurer:
             2862          (a) reducing premiums because of expense savings;
             2863          (b) providing to a policyholder or insured one or more incentives, as defined by the
             2864      commissioner by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             2865      Rulemaking Act, to participate in a program or activity designed to reduce claims or claim
             2866      expenses, including:
             2867          (i) a premium discount offered to a small or large employer group based on a wellness
             2868      program if:
             2869          (A) the premium discount for the employer group does not exceed 20% of the group
             2870      premium; and
             2871          (B) the premium discount based on the wellness program is offered uniformly by the
             2872      insurer to all employer groups in the large or small group market;
             2873          (ii) a premium discount offered to employees of a small or large employer group in an
             2874      amount that does not exceed federal limits on wellness program incentives; or
             2875          (iii) a combination of premium discounts offered to the employer group and the
             2876      employees of an employer group, based on a wellness program, if:
             2877          (A) the premium discounts for the employer group comply with Subsection (3)(b)(i);
             2878      and
             2879          (B) the premium discounts for the employees of an employer group comply with
             2880      Subsection (3)(b)(ii); or
             2881          (c) receiving premiums under an installment payment plan.
             2882          (4) Items not prohibited by Subsection (1) include a producer, consultant, or other
             2883      licensee, or an officer or employee of a licensee, either directly or through a third party:
             2884          (a) engaging in a usual kind of social courtesy if receipt of the social courtesy is not
             2885      conditioned on a quote or the purchase of a particular insurance product;


             2886          (b) extending credit on a premium to the insured:
             2887          (i) without interest, for no more than 90 days from the effective date of the insurance
             2888      contract;
             2889          (ii) for interest that is not less than the legal rate under Section 15-1-1 , on the unpaid
             2890      balance after the time period described in Subsection (4)(b)(i); and
             2891          (iii) except that an installment or payroll deduction payment of premiums on an
             2892      insurance contract issued under an insurer's mass marketing program is not considered an
             2893      extension of credit for purposes of this Subsection (4)(b);
             2894          (c) preparing or conducting a survey that:
             2895          (i) is directly related to an accident and health insurance policy purchased from the
             2896      licensee; or
             2897          (ii) is used by the licensee to assess the benefit needs and preferences of insureds,
             2898      employers, or employees directly related to an insurance product sold by the licensee;
             2899          (d) providing limited human resource services that are directly related to an insurance
             2900      product sold by the licensee, including:
             2901          (i) answering questions directly related to:
             2902          (A) an employee benefit offering or administration, if the insurance product purchased
             2903      from the licensee is accident and health insurance or health insurance; and
             2904          (B) employment practices liability, if the insurance product offered by or purchased
             2905      from the licensee is property or casualty insurance; and
             2906          (ii) providing limited human resource compliance training and education directly
             2907      pertaining to an insurance product purchased from the licensee;
             2908          (e) providing the following types of information or guidance:
             2909          (i) providing guidance directly related to compliance with federal and state laws for an
             2910      insurance product purchased from the licensee;
             2911          (ii) providing a workshop or seminar addressing an insurance issue that is directly
             2912      related to an insurance product purchased from the licensee; or
             2913          (iii) providing information regarding:


             2914          (A) employee benefit issues;
             2915          (B) directly related insurance regulatory and legislative updates; or
             2916          (C) similar education about an insurance product sold by the licensee and how the
             2917      insurance product interacts with tax law;
             2918          (f) preparing or providing a form that is directly related to an insurance product
             2919      purchased from, or offered by, the licensee;
             2920          (g) preparing or providing documents directly related to a premium only cafeteria plan
             2921      within the meaning of Section 125, Internal Revenue Code, or a flexible spending account, but
             2922      not providing ongoing administration of a flexible spending account;
             2923          (h) providing enrollment and billing assistance, including:
             2924          (i) providing benefit statements or new hire insurance benefits packages; and
             2925          (ii) providing technology services such as an electronic enrollment platform or
             2926      application system;
             2927          (i) communicating coverages in writing and in consultation with the insured and
             2928      employees;
             2929          (j) providing employee communication materials and notifications directly related to an
             2930      insurance product purchased from a licensee;
             2931          (k) providing claims management and resolution to the extent permitted under the
             2932      licensee's license;
             2933          (l) providing underwriting or actuarial analysis or services;
             2934          (m) negotiating with an insurer regarding the placement and pricing of an insurance
             2935      product;
             2936          (n) recommending placement and coverage options;
             2937          (o) providing a health fair or providing assistance or advice on establishing or
             2938      operating a wellness program, but not providing any payment for or direct operation of the
             2939      wellness program;
             2940          (p) providing COBRA and Utah mini-COBRA administration, consultations, and other
             2941      services directly related to an insurance product purchased from the licensee;


             2942          (q) assisting with a summary plan description;
             2943          (r) providing information necessary for the preparation of documents directly related to
             2944      the Employee Retirement Income Security Act of 1974, 29 U.S.C. Sec. 1001, et seq., as
             2945      amended;
             2946          (s) providing information or services directly related to the Health Insurance Portability
             2947      and Accountability Act of 1996, Pub. L. 104-191, 110 Stat. 1936, as amended, such as services
             2948      directly related to health care access, portability, and renewability when offered in connection
             2949      with accident and health insurance sold by a licensee;
             2950          (t) sending proof of coverage to a third party with a legitimate interest in coverage;
             2951          (u) providing information in a form approved by the commissioner and directly related
             2952      to determining whether an insurance product sold by the licensee meets the requirements of a
             2953      third party contract that requires or references insurance coverage;
             2954          (v) facilitating risk management services directly related to [the] property and casualty
             2955      insurance [product] products sold or offered for sale by the licensee, including:
             2956          (i) risk management;
             2957          (ii) claims and loss control services; [and]
             2958          (iii) risk assessment consulting[;], including analysis of:
             2959          (A) employer's job descriptions; or
             2960          (B) employer's safety procedures or manuals; and
             2961          (iv) providing information and training on best practices;
             2962          (w) otherwise providing services that are legitimately part of servicing an insurance
             2963      product purchased from a licensee; and
             2964          (x) providing other directly related services approved by the department.
             2965          (5) An inducement prohibited under Subsection (1) includes a producer, consultant, or
             2966      other licensee, or an officer or employee of a licensee:
             2967          (a) (i) providing a premium or commission rebate;
             2968          (ii) paying the salary of an employee of a person who purchases an insurance product
             2969      from the licensee; or


             2970          (iii) if the licensee is an insurer, or a third party administrator who contracts with an
             2971      insurer, paying the salary for an onsite staff member to perform an act prohibited under
             2972      Subsection (5)(b)(xii); or
             2973          (b) engaging in one or more of the following unless a fee is paid in accordance with
             2974      Subsection [(7)] (8):
             2975          (i) performing background checks of prospective employees;
             2976          (ii) providing legal services by a person licensed to practice law;
             2977          (iii) performing drug testing that is directly related to an insurance product purchased
             2978      from the licensee;
             2979          (iv) preparing employer or employee handbooks, except that a licensee may:
             2980          (A) provide information for a medical benefit section of an employee handbook;
             2981          (B) provide information for the section of an employee handbook directly related to an
             2982      employment practices liability insurance product purchased from the licensee; or
             2983          (C) prepare or print an employee benefit enrollment guide;
             2984          (v) providing job descriptions, postings, and applications for a person [that purchases
             2985      an employment practices liability insurance product from the licensee];
             2986          (vi) providing payroll services;
             2987          (vii) providing performance reviews or performance review training;
             2988          (viii) providing union advice;
             2989          (ix) providing accounting services;
             2990          (x) providing data analysis information technology programs, except as provided in
             2991      Subsection (4)(h)(ii);
             2992          (xi) providing administration of health reimbursement accounts or health savings
             2993      accounts; or
             2994          (xii) if the licensee is an insurer, or a third party administrator who contracts with an
             2995      insurer, the insurer issuing an insurance policy that lists in the insurance policy one or more of
             2996      the following prohibited benefits:
             2997          (A) performing background checks of prospective employees;


             2998          (B) providing legal services by a person licensed to practice law;
             2999          (C) performing drug testing that is directly related to an insurance product purchased
             3000      from the insurer;
             3001          (D) preparing employer or employee handbooks;
             3002          (E) providing job descriptions postings, and applications;
             3003          (F) providing payroll services;
             3004          (G) providing performance reviews or performance review training;
             3005          (H) providing union advice;
             3006          (I) providing accounting services;
             3007          (J) providing discrimination testing; or
             3008          (K) providing data analysis information technology programs.
             3009          (6) A producer, consultant, or other licensee or an officer or employee of a licensee
             3010      shall itemize and bill separately from any other insurance product or service offered or
             3011      provided under Subsection (5)(b).
             3012          [(6)] (7) (a) A de minimis gift or meal not to exceed $25 for each individual receiving
             3013      the gift or meal is presumed to be a social courtesy not conditioned on [the] a quote or purchase
             3014      of a particular insurance product for purposes of Subsection (4)(a).
             3015          (b) Notwithstanding Subsection (4)(a), a de minimis gift or meal not to exceed $10
             3016      may be conditioned on receipt of a quote of a particular insurance product if the de minimis gift
             3017      or meal is provided by the insurer and not by a producer or consultant.
             3018          [(7)] (8) If as provided under Subsection (5)(b) a producer, consultant, or other licensee
             3019      is paid a fee to provide an item listed in Subsection (5)(b), the licensee shall comply with
             3020      Subsection 31A-23a-501 (2) in charging the fee, except that the fee paid for the item shall equal
             3021      or exceed the fair market value of the item.
             3022          Section 30. Section 31A-23a-406 is amended to read:
             3023           31A-23a-406. Title insurance producer's business.
             3024          (1) [A] An individual title insurance producer or agency title insurance producer may
             3025      do escrow involving real property transactions if all of the following exist:


             3026          (a) the individual title insurance producer or agency title insurance producer is licensed
             3027      with:
             3028          (i) the title line of authority; and
             3029          (ii) the escrow subline of authority;
             3030          (b) the individual title insurance producer or agency title insurance producer is
             3031      appointed by a title insurer authorized to do business in the state;
             3032          (c) the individual title insurance producer or agency title insurance producer issues one
             3033      or more of the following as part of the transaction:
             3034          (i) an owner's policy of title insurance; or
             3035          (ii) a lender's policy of title insurance;
             3036          (d) money deposited with the individual title insurance producer or agency title
             3037      insurance producer in connection with any escrow:
             3038          (i) is deposited:
             3039          (A) in a federally insured financial institution; and
             3040          (B) in a trust account that is separate from all other trust account money that is not
             3041      related to real estate transactions;
             3042          (ii) is the property of the one or more persons entitled to the money under the
             3043      provisions of the escrow; and
             3044          (iii) is segregated escrow by escrow in the records of the individual title insurance
             3045      producer or agency title insurance producer;
             3046          (e) earnings on money held in escrow may be paid out of the escrow account to any
             3047      person in accordance with the conditions of the escrow;
             3048          (f) the escrow does not require the individual title insurance producer or agency title
             3049      insurance producer to hold:
             3050          (i) construction money; or
             3051          (ii) money held for exchange under Section 1031, Internal Revenue Code; and
             3052          (g) the individual title insurance producer or agency title insurance producer shall
             3053      maintain a physical office in Utah staffed by a person with an escrow subline of authority who


             3054      processes the escrow.
             3055          (2) Notwithstanding Subsection (1), [a] an individual title insurance producer or
             3056      agency title insurance producer may engage in the escrow business if:
             3057          (a) the escrow involves:
             3058          (i) a mobile home;
             3059          (ii) a grazing right;
             3060          (iii) a water right; or
             3061          (iv) other personal property authorized by the commissioner; and
             3062          (b) the individual title insurance producer or agency title insurance producer complies
             3063      with this section except for Subsection (1)(c).
             3064          (3) Money held in escrow:
             3065          (a) is not subject to any debts of the individual title insurance producer or agency title
             3066      insurance producer;
             3067          (b) may only be used to fulfill the terms of the individual escrow under which the
             3068      money is accepted; and
             3069          (c) may not be used until the conditions of the escrow are met.
             3070          (4) Assets or property other than escrow money received by [a] an individual title
             3071      insurance producer or agency title insurance producer in accordance with an escrow shall be
             3072      maintained in a manner that will:
             3073          (a) reasonably preserve and protect the asset or property from loss, theft, or damages;
             3074      and
             3075          (b) otherwise comply with the general duties and responsibilities of a fiduciary or
             3076      bailee.
             3077          (5) (a) A check from the trust account described in Subsection (1)(d) may not be
             3078      drawn, executed, or dated, or money otherwise disbursed unless the segregated escrow account
             3079      from which money is to be disbursed contains a sufficient credit balance consisting of collected
             3080      and cleared money at the time the check is drawn, executed, or dated, or money is otherwise
             3081      disbursed.


             3082          (b) As used in this Subsection (5), money is considered to be "collected and cleared,"
             3083      and may be disbursed as follows:
             3084          (i) cash may be disbursed on the same day the cash is deposited;
             3085          (ii) a wire transfer may be disbursed on the same day the wire transfer is deposited; and
             3086          (iii) the proceeds of one or more of the following financial instruments may be
             3087      disbursed on the same day the financial instruments are deposited if received from a single
             3088      party to the real estate transaction and if the aggregate of the financial instruments for the real
             3089      estate transaction is less than $10,000:
             3090          (A) a cashier's check, certified check, or official check that is drawn on an existing
             3091      account at a federally insured financial institution;
             3092          (B) a check drawn on the trust account of a principal broker or associate broker
             3093      licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices Act, if the individual
             3094      title insurance producer or agency title insurance producer has reasonable and prudent grounds
             3095      to believe sufficient money will be available from the trust account on which the check is
             3096      drawn at the time of disbursement of proceeds from the individual title insurance producer or
             3097      agency title insurance producer's escrow account;
   &nbs