H.B. 146 Enrolled

NONTRADITIONAL INSURERS
2003 GENERAL SESSION
STATE OF UTAH
Sponsor: James A. Ferrin
This act modifies the Insurance Code to replace the definition for a nonprofit educational
insurer with a definition for a nontraditional insurer, and to continue the exemption of
nonprofit educational insurers from certain provisions of the Insurance Code to
nontraditional insurers.
This act affects sections of Utah Code Annotated 1953 as follows:
AMENDS:
31A-10-201, as enacted by Chapter 204, Laws of Utah 1986
31A-10-202, as enacted by Chapter 204, Laws of Utah 1986
31A-10-203, as last amended by Chapter 245, Laws of Utah 1994
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 31A-10-201 is amended to read:
Part II. Nontraditional Insurers
31A-10-201. Definition.
As used in this part[, "nonprofit educational]:
(1) "Nontraditional insurer" means [a nonprofit] an insurer incorporated under Chapter
5, Domestic Stock and Mutual Insurance Corporations, or admitted under Chapter 14 [which],
Foreign Insurers, that:
(a) exists for the purpose of aiding and strengthening [nonprofit educational and
research institutions by providing them and their employees with annuities and insurance. An
insurer is not a nonprofit educational insurer if it provides annuities or insurance to persons
other than nonprofit educational and research institutions and their employees.] the following
by providing them with annuities:
(i) nonprofit entities;
(ii) employees of nonprofit entities;
(iii) governmental entities; and

(iv) employees of governmental entities;
(b) issues only annuities and no other insurance product; and
(c) does not pay any benefit based on a guarantee as to principal, interest rate, return on
investment, mortality, and morbidity.
(2) "Nontraditional insurer" does not include an insurer that provides annuities to persons
other than:
(a) nonprofit entities;
(b) employees of nonprofit entities;
(c) governmental entities; and
(d) employees of governmental entities.
Section 2. Section 31A-10-202 is amended to read:
31A-10-202. Purposes of part.
The purposes of this part are:
(1) to provide for the continued operation in this state, subject to the provisions of this
title, of [nonprofit organizations] nontraditional insurers providing annuities [and insurance to
the educational and research institutions] to the nonprofit entities and governmental entities of
this state and their employees; and
(2) to specify provisions which equitably deal with the operational, structural, and
functional differences between [nonprofit educational] nontraditional insurers and other insurers,
without compromising the interests of policyholders.
Section 3. Section 31A-10-203 is amended to read:
31A-10-203. Applicability of other provisions.
(1) Except as provided in this section, domestic [nonprofit educational] nontraditional
insurers are subject to the same provisions applicable to other domestic insurers, and
nondomestic [nonprofit educational] nontraditional insurers are subject to the same provisions
applicable to other nondomestic insurers.
[(2) Chapter 28 does not apply to the annuity business nor to annuitants of nonprofit
educational insurers.]

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[(3)] (2) [Nonprofit educational insurers that do not issue contracts containing guarantees
as to principal, interest rate, return on investment, mortality, and morbidity] Nontraditional
insurers are not subject to:
(a) Section 31A-5-211 ;
(b) Section 31A-5-217 ;
(c) Subsection 31A-14-205 (1)(a);
(d) Chapter 17, Determination of Financial Condition;
(e) Chapter 18, Investments;
(f) Section 31A-20-106 ;
(g) Chapter 21, Insurance Contracts in General, if:
(i) their contract forms have been approved by the appropriate regulatory authorities in
their state of domicile; and
(ii) these contract forms are standard forms generally issued by those [nonprofit
educational] nontraditional insurers in the United States; [or]
(h) Chapter 22[.], Contracts in Specific Lines; or
(i) Chapter 28, Guaranty Associations.

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