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H.B. 19 Enrolled
7 LONG TITLE
8 General Description:
9 This bill modifies the Insurance Code and other provisions related to the regulation of
10 insurance and insurance products.
11 Highlighted Provisions:
12 This bill:
13 . amends definitions;
14 . creates the Insurance Department Restricted Account;
15 . addresses fees for captive insurance companies and the cap on the Captive
16 Insurance Restricted Account;
17 . modifies restrictions on foreign title insurers;
18 . removes outdated language;
19 . addresses grace periods for accident and health insurance policies;
20 . modifies provisions related to individuals, group, or blanket accident and health
21 insurance coverage;
22 . addresses health benefit plan offerings;
23 . addresses producer lines of authority;
24 . addresses a written agreement related to a voluntary surrender of a license;
25 . amends provisions related to continuing education;
26 . provides for training related to long-term care insurance;
27 . modifies title insurance agency and producer licensing requirements;
28 . addresses when a title insurance producer may do an escrow involving a real
29 property transaction;
30 . modifies provisions related to disbursements from escrow accounts;
31 . modifies title insurance related assessments;
32 . addresses licensee compensation;
33 . addresses when a person may represent that the person acts in behalf of an insurer;
34 . modifies provisions related to providing the commissioner address, telephone, and
35 email address information;
36 . addresses verification under a nonresident jurisdictional agreement;
37 . addresses per diem and travel expenses of public representatives on the board of
38 directors of the Utah Life and Health Insurance Guaranty Association;
39 . addresses the establishment of classes of business;
40 . modifies rating restrictions;
41 . addresses the renewal of a bail bond surety company license;
42 . permits the commissioner to assign a department employee to engage in certain
43 activities related to the regulation of captive insurance companies;
44 . requires a professional employer organization to notify the commissioner of
45 material changes;
46 . removes the title insurance assessment from the sunset act;
47 . converts certain dedicated credits into several restricted accounts and provides that
48 related appropriations are nonlapsing; and
49 . makes technical and conforming amendments.
50 Money Appropriated in this Bill:
52 Other Special Clauses:
53 This bill has an effective date.
54 This bill provides for retrospective operation of certain provisions.
55 Utah Code Sections Affected:
57 31A-1-301, as last amended by Laws of Utah 2010, Chapter 10
58 31A-2-208, as last amended by Laws of Utah 2010, Chapter 391
59 31A-2-212, as last amended by Laws of Utah 2007, Chapter 309
60 31A-3-101, as last amended by Laws of Utah 2008, Chapter 382
61 31A-3-103, as last amended by Laws of Utah 2010, Chapter 10
62 31A-3-304, as last amended by Laws of Utah 2010, Chapters 10, 68 and last amended
63 by Coordination Clause, Laws of Utah 2010, Chapter 265
64 31A-14-211, as last amended by Laws of Utah 2003, Chapter 298
65 31A-22-607, as last amended by Laws of Utah 2004, Chapter 329
66 31A-22-610.6, as enacted by Laws of Utah 2008, Chapters 345, 383, and 390
67 31A-22-614.5, as last amended by Laws of Utah 2010, Chapter 357
68 31A-22-618.5, as last amended by Laws of Utah 2010, Chapter 68
69 31A-22-625, as last amended by Laws of Utah 2010, Chapters 10 and 68
70 31A-22-701, as last amended by Laws of Utah 2010, Chapter 10
71 31A-22-716, as last amended by Laws of Utah 2005, Chapter 71
72 31A-22-721, as last amended by Laws of Utah 2004, Chapter 329
73 31A-22-723, as last amended by Laws of Utah 2010, Chapter 68
74 31A-23a-102, as last amended by Laws of Utah 2009, Chapter 349
75 31A-23a-106, as last amended by Laws of Utah 2009, Chapter 349
76 31A-23a-111, as last amended by Laws of Utah 2009, Chapters 349 and 355
77 31A-23a-202, as last amended by Laws of Utah 2009, Chapter 127
78 31A-23a-203, as last amended by Laws of Utah 2009, Chapter 349
79 31A-23a-204, as last amended by Laws of Utah 2009, Chapter 349
80 31A-23a-406, as last amended by Laws of Utah 2007, Chapter 325
81 31A-23a-408, as renumbered and amended by Laws of Utah 2003, Chapter 298
82 31A-23a-412, as renumbered and amended by Laws of Utah 2003, Chapter 298
83 31A-23a-415, as last amended by Laws of Utah 2010, Chapter 10 and last amended by
84 Coordination Clause, Laws of Utah 2010, Chapter 265
85 31A-23a-501, as last amended by Laws of Utah 2010, Chapter 10
86 31A-25-208, as last amended by Laws of Utah 2009, Chapter 349
87 31A-26-206, as last amended by Laws of Utah 2008, Chapter 382
88 31A-26-208, as last amended by Laws of Utah 2008, Chapter 3
89 31A-26-213, as last amended by Laws of Utah 2009, Chapter 349
90 31A-26-306, as last amended by Laws of Utah 2004, Chapter 173
91 31A-28-107, as last amended by Laws of Utah 2010, Chapter 292
92 31A-29-103, as last amended by Laws of Utah 2008, Chapters 3 and 385
93 31A-29-106, as last amended by Laws of Utah 2008, Chapter 382
94 31A-30-103, as last amended by Laws of Utah 2010, Chapter 68
95 31A-30-105, as last amended by Laws of Utah 2010, Chapter 68
96 31A-30-106, as last amended by Laws of Utah 2010, Chapter 68
97 31A-30-106.1, as enacted by Laws of Utah 2010, Chapter 68
98 31A-30-106.5, as last amended by Laws of Utah 2010, Chapter 68
99 31A-30-108, as last amended by Laws of Utah 2008, Chapter 383
100 31A-30-110, as last amended by Laws of Utah 2002, Chapter 308
101 31A-30-112, as last amended by Laws of Utah 2009, Chapter 12
102 31A-31-108, as last amended by Laws of Utah 2010, Chapter 391
103 31A-31-109, as last amended by Laws of Utah 2010, Chapter 391
104 31A-35-202, as last amended by Laws of Utah 2000, Chapter 259
105 31A-35-406, as last amended by Laws of Utah 2010, Chapter 10
106 31A-35-602, as last amended by Laws of Utah 2000, Chapter 259
107 31A-37-103, as last amended by Laws of Utah 2008, Chapter 302
108 31A-37-202, as last amended by Laws of Utah 2009, Chapter 183
109 31A-37-504, as last amended by Laws of Utah 2007, Chapter 309
110 59-9-105, as last amended by Laws of Utah 2002, Chapter 308
111 63I-2-231, as last amended by Laws of Utah 2010, Chapters 68 and 285
112 63J-1-602.2, as enacted by Laws of Utah 2010, Chapter 265 and last amended by
113 Coordination Clause, Laws of Utah 2010, Chapter 265
114 63J-1-602.3, as enacted by Laws of Utah 2010, Chapter 265
116 31A-40-308, Utah Code Annotated 1953
117 Uncodified Material Affected:
118 ENACTS UNCODIFIED MATERIAL
120 Be it enacted by the Legislature of the state of Utah:
121 Section 1. Section 31A-1-301 is amended to read:
122 31A-1-301. Definitions.
123 As used in this title, unless otherwise specified:
124 (1) (a) "Accident and health insurance" means insurance to provide protection against
125 economic losses resulting from:
126 (i) a medical condition including:
127 (A) a medical care expense; or
128 (B) the risk of disability;
129 (ii) accident; or
130 (iii) sickness.
131 (b) "Accident and health insurance":
132 (i) includes a contract with disability contingencies including:
133 (A) an income replacement contract;
134 (B) a health care contract;
135 (C) an expense reimbursement contract;
136 (D) a credit accident and health contract;
137 (E) a continuing care contract; and
138 (F) a long-term care contract; and
139 (ii) may provide:
140 (A) hospital coverage;
141 (B) surgical coverage;
142 (C) medical coverage;
143 (D) loss of income coverage;
144 (E) prescription drug coverage;
145 (F) dental coverage; or
146 (G) vision coverage.
147 (c) "Accident and health insurance" does not include workers' compensation insurance.
148 (2) "Actuary" is as defined by the commissioner by rule, made in accordance with Title
149 63G, Chapter 3, Utah Administrative Rulemaking Act.
150 (3) "Administrator" is defined in Subsection [
151 (4) "Adult" means an individual who has attained the age of at least 18 years.
152 (5) "Affiliate" means a person who controls, is controlled by, or is under common
153 control with, another person. A corporation is an affiliate of another corporation, regardless of
154 ownership, if substantially the same group of individuals manage the corporations.
155 (6) "Agency" means:
156 (a) a person other than an individual, including a sole proprietorship by which an
157 individual does business under an assumed name; and
158 (b) an insurance organization licensed or required to be licensed under Section
159 31A-23a-301 , 31A-25-207 , or 31A-26-209 .
160 (7) "Alien insurer" means an insurer domiciled outside the United States.
161 (8) "Amendment" means an endorsement to an insurance policy or certificate.
162 (9) "Annuity" means an agreement to make periodical payments for a period certain or
163 over the lifetime of one or more individuals if the making or continuance of all or some of the
164 series of the payments, or the amount of the payment, is dependent upon the continuance of
165 human life.
166 (10) "Application" means a document:
167 (a) (i) completed by an applicant to provide information about the risk to be insured;
169 (ii) that contains information that is used by the insurer to evaluate risk and decide
170 whether to:
171 (A) insure the risk under:
172 (I) the coverage as originally offered; or
173 (II) a modification of the coverage as originally offered; or
174 (B) decline to insure the risk; or
175 (b) used by the insurer to gather information from the applicant before issuance of an
176 annuity contract.
177 (11) "Articles" or "articles of incorporation" means:
178 (a) the original articles;
179 (b) a special law;
180 (c) a charter;
181 (d) an amendment;
182 (e) restated articles;
183 (f) articles of merger or consolidation;
184 (g) a trust instrument;
185 (h) another constitutive document for a trust or other entity that is not a corporation;
187 (i) an amendment to an item listed in Subsections (11)(a) through (h).
188 (12) "Bail bond insurance" means a guarantee that a person will attend court when
189 required, up to and including surrender of the person in execution of a sentence imposed under
190 Subsection 77-20-7 (1), as a condition to the release of that person from confinement.
191 (13) "Binder" is defined in Section 31A-21-102 .
192 (14) "Blanket insurance policy" means a group policy covering a defined class of
194 (a) without individual underwriting or application; and
195 (b) that is determined by definition [
196 (15) "Board," "board of trustees," or "board of directors" means the group of persons
197 with responsibility over, or management of, a corporation, however designated.
198 (16) "Bona fide office" means a physical office in this state:
199 (a) that is open to the public;
200 (b) that is staffed during regular business hours on regular business days; and
201 (c) at which the public may appear in person to obtain services.
203 (a) a corporation;
204 (b) an association;
205 (c) a partnership;
206 (d) a limited liability company;
207 (e) a limited liability partnership; or
208 (f) another legal entity.
211 commissioner under Subsections 31A-5-204 (2)(i) and (j), including the information required
212 when these subsections apply by reference under:
213 (a) Section 31A-7-201 ;
214 (b) Section 31A-8-205 ; or
215 (c) Subsection 31A-9-205 (2).
217 corporation's affairs, however designated.
218 (b) "Bylaws" includes comparable rules for a trust or other entity that is not a
221 (a) an insurer:
222 (i) owned by another organization; and
223 (ii) whose exclusive purpose is to insure risks of the parent organization and an
224 affiliated company; or
225 (b) in the case of a group or association, an insurer:
226 (i) owned by the insureds; and
227 (ii) whose exclusive purpose is to insure risks of:
228 (A) a member organization;
229 (B) a group member; or
230 (C) an affiliate of:
231 (I) a member organization; or
232 (II) a group member.
235 (a) an insured under a group insurance policy; or
236 (b) a third party.
239 on an insurer for payment of a benefit according to the terms of an insurance policy.
241 coverage under a policy insuring against legal liability to claims that are first made against the
242 insured while the policy is in force.
244 insurance commissioner.
245 (b) When appropriate, the terms listed in Subsection [
246 equivalent supervisory official of another jurisdiction.
248 (i) provides board and lodging;
249 (ii) provides one or more of the following:
250 (A) a personal service;
251 (B) a nursing service;
252 (C) a medical service; or
253 (D) any other health-related service; and
254 (iii) provides the coverage described in this Subsection [
255 agreement effective:
256 (A) for the life of the insured; or
257 (B) for a period in excess of one year.
258 (b) Insurance is continuing care insurance regardless of whether or not the board and
259 lodging are provided at the same location as a service described in Subsection [
261 means the direct or indirect possession of the power to direct or cause the direction of the
262 management and policies of a person. This control may be:
263 (i) by contract;
264 (ii) by common management;
265 (iii) through the ownership of voting securities; or
266 (iv) by a means other than those described in Subsections [
267 (b) There is no presumption that an individual holding an official position with another
268 person controls that person solely by reason of the position.
269 (c) A person having a contract or arrangement giving control is considered to have
270 control despite the illegality or invalidity of the contract or arrangement.
271 (d) There is a rebuttable presumption of control in a person who directly or indirectly
272 owns, controls, holds with the power to vote, or holds proxies to vote 10% or more of the
273 voting securities of another person.
275 indirectly controlled by a producer.
277 power to direct or cause to be directed, the management, control, or activities of a reinsurance
280 an insurer.
282 (i) a corporation doing business:
283 (A) as:
284 (I) an insurance producer;
285 (II) a limited line producer;
286 (III) a consultant;
287 (IV) a managing general agent;
288 (V) a reinsurance intermediary;
289 (VI) a third party administrator; or
290 (VII) an adjuster; and
291 (B) under:
292 (I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
293 Reinsurance Intermediaries;
294 (II) Chapter 25, Third Party Administrators; or
295 (III) Chapter 26, Insurance Adjusters; or
296 (ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance
297 Holding Companies.
298 (b) "Stock corporation" means a stock insurance corporation.
299 (c) "Mutual" or "mutual corporation" means a mutual insurance corporation.
301 regulations adopted pursuant to the Health Insurance Portability and Accountability Act [
303 (b) "Creditable coverage" includes coverage that is offered through a public health plan
304 such as:
305 (i) the Primary Care Network Program under a Medicaid primary care network
306 demonstration waiver obtained subject to Section 26-18-3 ;
307 (ii) the Children's Health Insurance Program under Section 26-40-106 ; or
308 (iii) the Ryan White Program Comprehensive AIDS Resources Emergency Act, Pub. L.
309 101-381, and Ryan White HIV/AIDS Treatment Modernization Act of 2006, Pub. L. 109-415.
311 provide indemnity for payments coming due on a specific loan or other credit transaction while
312 the debtor is disabled.
314 extension of credit that is limited to partially or wholly extinguishing that credit obligation.
315 (b) "Credit insurance" includes:
316 (i) credit accident and health insurance;
317 (ii) credit life insurance;
318 (iii) credit property insurance;
319 (iv) credit unemployment insurance;
320 (v) guaranteed automobile protection insurance;
321 (vi) involuntary unemployment insurance;
322 (vii) mortgage accident and health insurance;
323 (viii) mortgage guaranty insurance; and
324 (ix) mortgage life insurance.
326 with an extension of credit that pays a person if the debtor dies.
328 (a) offered in connection with an extension of credit; and
329 (b) that protects the property until the debt is paid.
331 (a) offered in connection with an extension of credit; and
332 (b) that provides indemnity if the debtor is unemployed for payments coming due on a:
333 (i) specific loan; or
334 (ii) credit transaction.
336 (a) matured;
337 (b) unmatured;
338 (c) liquidated;
339 (d) unliquidated;
340 (e) secured;
341 (f) unsecured;
342 (g) absolute;
343 (h) fixed; or
344 (i) contingent.
346 insurance service and insurance product information:
347 (i) for the customer service representative's:
348 (A) producer; or
349 (B) consultant employer; and
350 (ii) to the customer service representative's employer's:
351 (A) customer;
352 (B) client; or
353 (C) organization.
354 (b) A customer service representative may only operate within the scope of authority of
355 the customer service representative's producer or consultant employer.
357 (a) imposed by:
358 (i) statute;
359 (ii) rule; or
360 (iii) order; and
361 (b) by which a required filing or payment must be received by the department.
363 occurrence of a condition precedent, the commissioner is considered to have taken a specific
364 action. If the statute so provides, a condition precedent may be the commissioner's failure to
365 take a specific action.
367 determined by counting the generations separating one person from a common ancestor and
368 then counting the generations to the other person.
372 or totally limits an individual's ability to:
373 (a) perform the duties of:
374 (i) that individual's occupation; or
375 (ii) any occupation for which the individual is reasonably suited by education, training,
376 or experience; or
377 (b) perform two or more of the following basic activities of daily living:
378 (i) eating;
379 (ii) toileting;
380 (iii) transferring;
381 (iv) bathing; or
382 (v) dressing.
386 (a) is incorporated;
387 (b) is organized; or
388 (c) in the case of an alien insurer, enters into the United States.
390 (i) an employee who:
391 (A) works on a full-time basis; and
392 (B) has a normal work week of 30 or more hours; or
393 (ii) a person described in Subsection [
394 (b) "Eligible employee" includes, if the individual is included under a health benefit
395 plan of a small employer:
396 (i) a sole proprietor;
397 (ii) a partner in a partnership; or
398 (iii) an independent contractor.
399 (c) "Eligible employee" does not include, unless eligible under Subsection [
401 (i) an individual who works on a temporary or substitute basis for a small employer;
402 (ii) an employer's spouse; or
403 (iii) a dependent of an employer.
406 (a) an employee; or
407 (b) a dependent of an employee.
409 (i) established or maintained, whether directly or through a trustee, by:
410 (A) one or more employers;
411 (B) one or more labor organizations; or
412 (C) a combination of employers and labor organizations; and
413 (ii) that provides employee benefits paid or contracted to be paid, other than income
414 from investments of the fund:
415 (A) by or on behalf of an employer doing business in this state; or
416 (B) for the benefit of a person employed in this state.
417 (b) "Employee welfare fund" includes a plan funded or subsidized by a user fee or tax
420 to modify the policy or certificate coverage.
422 (a) the first day of coverage; or
423 (b) if there is a waiting period, the first day of the waiting period.
425 (i) a real estate settlement or real estate closing conducted by a third party pursuant to
426 the requirements of a written agreement between the parties in a real estate transaction; or
427 (ii) a settlement or closing involving:
428 (A) a mobile home;
429 (B) a grazing right;
430 (C) a water right; or
431 (D) other personal property authorized by the commissioner.
432 (b) "Escrow" includes the act of conducting a:
433 (i) real estate settlement; or
434 (ii) real estate closing.
436 (a) an insurance producer with:
437 (i) a title insurance line of authority; and
438 (ii) an escrow subline of authority; or
439 (b) a person defined as an escrow agent in Section 7-22-101 .
441 also excluded.
442 (b) The items listed in a list using the term "excludes" are representative examples for
443 use in interpretation of this title.
445 insurer does not provide insurance coverage, for whatever reason, for one of the following:
446 (a) a specific physical condition;
447 (b) a specific medical procedure;
448 (c) a specific disease or disorder; or
449 (d) a specific prescription drug or class of prescription drugs.
451 (a) written to provide a payment for an expense relating to hospital confinement
452 resulting from illness or injury; and
453 (b) written:
454 (i) as a daily limit for a specific number of days in a hospital; and
455 (ii) to have a one or two day waiting period following a hospitalization.
457 holding a position of public or private trust.
459 (i) submitted to the department as required by and in accordance with applicable
460 statute, rule, or filing order;
461 (ii) received by the department within the time period provided in applicable statute,
462 rule, or filing order; and
463 (iii) accompanied by the appropriate fee in accordance with:
464 (A) Section 31A-3-103 ; or
465 (B) rule.
466 (b) "Filed" does not include a filing that is rejected by the department because it is not
467 submitted in accordance with Subsection [
469 department including:
470 (a) a policy;
471 (b) a rate;
472 (c) a form;
473 (d) a document;
474 (e) a plan;
475 (f) a manual;
476 (g) an application;
477 (h) a report;
478 (i) a certificate;
479 (j) an endorsement;
480 (k) an actuarial certification;
481 (l) a licensee annual statement;
482 (m) a licensee renewal application;
483 (n) an advertisement; or
484 (o) an outline of coverage.
486 insurer agrees to pay a claim submitted to it by the insured for the insured's losses.
488 an alien insurer.
490 (i) a policy;
491 (ii) a certificate;
492 (iii) an application;
493 (iv) an outline of coverage; or
494 (v) an endorsement.
495 (b) "Form" does not include a document specially prepared for use in an individual
498 through a mass marketing arrangement involving a defined class of persons related in some
499 way other than through the purchase of insurance.
501 (a) the general lines of insurance in Subsection [
502 (b) title insurance under one of the following sublines of authority:
503 (i) search, including authority to act as a title marketing representative;
504 (ii) escrow, including authority to act as a title marketing representative; and
505 (iii) title marketing representative only;
506 (c) surplus lines;
507 (d) workers' compensation; and
508 (e) any other line of insurance that the commissioner considers necessary to recognize
509 in the public interest.
511 (a) accident and health;
512 (b) casualty;
513 (c) life;
514 (d) personal lines;
515 (e) property; and
516 (f) variable contracts, including variable life and annuity.
518 that the plan provides medical care:
519 (a) (i) to an employee; or
520 (ii) to a dependent of an employee; and
521 (b) (i) directly;
522 (ii) through insurance reimbursement; or
523 (iii) through another method.
525 that is issued:
526 (i) to a policyholder on behalf of the group; and
527 (ii) for the benefit of a member of the group who is selected under a procedure defined
529 (A) the policy; or
530 (B) an agreement that is collateral to the policy.
531 (b) A group insurance policy may include a member of the policyholder's family or a
534 connection with an extension of credit that pays the difference in amount between the
535 insurance settlement and the balance of the loan if the insured automobile is a total loss.
537 means a policy or certificate that:
538 (i) provides health care insurance;
539 (ii) provides major medical expense insurance; or
540 (iii) is offered as a substitute for hospital or medical expense insurance, such as:
541 (A) a hospital confinement indemnity; or
542 (B) a limited benefit plan.
543 (b) "Health benefit plan" does not include a policy or certificate that:
544 (i) provides benefits solely for:
545 (A) accident;
546 (B) dental;
547 (C) income replacement;
548 (D) long-term care;
549 (E) a Medicare supplement;
550 (F) a specified disease;
551 (G) vision; or
552 (H) a short-term limited duration; or
553 (ii) is offered and marketed as supplemental health insurance.
555 treatment, mitigation, or prevention of a human ailment or impairment:
556 (a) a professional service;
557 (b) a personal service;
558 (c) a facility;
559 (d) equipment;
560 (e) a device;
561 (f) supplies; or
562 (g) medicine.
565 (i) a health care benefit; or
566 (ii) payment of an incurred health care expense.
567 (b) "Health care insurance" or "health insurance" does not include accident and health
568 insurance providing a benefit for:
569 (i) replacement of income;
570 (ii) short-term accident;
571 (iii) fixed indemnity;
572 (iv) credit accident and health;
573 (v) supplements to liability;
574 (vi) workers' compensation;
575 (vii) automobile medical payment;
576 (viii) no-fault automobile;
577 (ix) equivalent self-insurance; or
578 (x) a type of accident and health insurance coverage that is a part of or attached to
579 another type of policy.
580 (77) "Health Insurance Portability and Accountability Act" means the Health Insurance
581 Portability and Accountability Act of 1996, Pub. L. 104-191, 110 Stat. 1936, as amended.
583 insurance written to provide payments to replace income lost from accident or sickness.
585 insured loss.
587 under Section 31A-26-201 who engages in insurance adjusting as a representative of an insurer.
589 Section 31A-15-104 .
592 (a) property in transit on or over land;
593 (b) property in transit over water by means other than boat or ship;
594 (c) bailee liability;
595 (d) fixed transportation property such as bridges, electric transmission systems, radio
596 and television transmission towers and tunnels; and
597 (e) personal and commercial property floaters.
599 (a) an insurer is unable to pay its debts or meet its obligations as the debts and
600 obligations mature;
601 (b) an insurer's total adjusted capital is less than the insurer's mandatory control level
602 RBC under Subsection 31A-17-601 (8)(c); or
603 (c) an insurer is determined to be hazardous under this title.
605 (i) an arrangement, contract, or plan for the transfer of a risk or risks from one or more
606 persons to one or more other persons; or
607 (ii) an arrangement, contract, or plan for the distribution of a risk or risks among a
608 group of persons that includes the person seeking to distribute that person's risk.
609 (b) "Insurance" includes:
610 (i) a risk distributing arrangement providing for compensation or replacement for
611 damages or loss through the provision of a service or a benefit in kind;
612 (ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a
613 business and not as merely incidental to a business transaction; and
614 (iii) a plan in which the risk does not rest upon the person who makes an arrangement,
615 but with a class of persons who have agreed to share the risk.
617 negotiation, or settlement of a claim under an insurance policy other than life insurance or an
618 annuity, on behalf of an insurer, policyholder, or a claimant under an insurance policy.
620 (a) providing health care insurance by an organization that is or is required to be
621 licensed under this title;
622 (b) providing a benefit to an employee in the event of a contingency not within the
623 control of the employee, in which the employee is entitled to the benefit as a right, which
624 benefit may be provided either:
625 (i) by a single employer or by multiple employer groups; or
626 (ii) through one or more trusts, associations, or other entities;
627 (c) providing an annuity:
628 (i) including an annuity issued in return for a gift; and
629 (ii) except an annuity provided by a person specified in Subsections 31A-22-1305 (2)
630 and (3);
631 (d) providing the characteristic services of a motor club as outlined in Subsection
633 (e) providing another person with insurance;
634 (f) making as insurer, guarantor, or surety, or proposing to make as insurer, guarantor,
635 or surety, a contract or policy of title insurance;
636 (g) transacting or proposing to transact any phase of title insurance, including:
637 (i) solicitation;
638 (ii) negotiation preliminary to execution;
639 (iii) execution of a contract of title insurance;
640 (iv) insuring; and
641 (v) transacting matters subsequent to the execution of the contract and arising out of
642 the contract, including reinsurance; [
647 (a) advises another person about insurance needs and coverages;
648 (b) is compensated by the person advised on a basis not directly related to the insurance
649 placed; and
650 (c) except as provided in Section 31A-23a-501 , is not compensated directly or
651 indirectly by an insurer or producer for advice given.
653 affiliated persons, at least one of whom is an insurer.
655 to be licensed under the laws of this state to sell, solicit, or negotiate insurance.
659 directly or indirectly by an insurer for selling, soliciting, or negotiating [
660 of that insurer[
661 (ii) "Producer for the insurer" may be referred to as an "agent."
663 (A) is compensated directly and only by an insurance customer or an insured; and
664 (B) receives no compensation directly or indirectly from an insurer for selling,
665 soliciting, or negotiating [
667 (ii) "Producer for the insured" may be referred to as a "broker."
669 makes a promise in an insurance policy and includes:
670 (i) a policyholder;
671 (ii) a subscriber;
672 (iii) a member; and
673 (iv) a beneficiary.
674 (b) The definition in Subsection [
675 (i) applies only to this title; and
676 (ii) does not define the meaning of this word as used in an insurance policy or
680 (i) a fraternal benefit society;
681 (ii) an issuer of a gift annuity other than an annuity specified in Subsections
682 31A-22-1305 (2) and (3);
683 (iii) a motor club;
684 (iv) an employee welfare plan; and
685 (v) a person purporting or intending to do an insurance business as a principal on that
686 person's own account.
687 (b) "Insurer" does not include a governmental entity to the extent the governmental
688 entity is engaged in an activity described in Section 31A-12-107 .
691 (a) offered in connection with an extension of credit; and
692 (b) that provides indemnity if the debtor is involuntarily unemployed for payments
693 coming due on a:
694 (i) specific loan; or
695 (ii) credit transaction.
697 employer who, with respect to a calendar year and to a plan year:
698 (a) employed an average of at least 51 eligible employees on each business day during
699 the preceding calendar year; and
700 (b) employs at least two employees on the first day of the plan year.
702 individual whose enrollment is a late enrollment.
704 enrollment of an individual other than:
705 (a) on the earliest date on which coverage can become effective for the individual
706 under the terms of the plan; or
707 (b) through special enrollment.
709 31A-1-103 , "legal expense insurance" means insurance written to indemnify or pay for a
710 specified legal expense.
711 (b) "Legal expense insurance" includes an arrangement that creates a reasonable
712 expectation of an enforceable right.
713 (c) "Legal expense insurance" does not include the provision of, or reimbursement for,
714 legal services incidental to other insurance coverage.
716 (i) for death, injury, or disability of a human being, or for damage to property,
717 exclusive of the coverages under:
718 (A) Subsection [
719 (B) Subsection [
720 (C) Subsection [
721 (ii) for a medical, hospital, surgical, and funeral benefit to a person other than the
722 insured who is injured, irrespective of legal liability of the insured, when issued with or
723 supplemental to insurance against legal liability for the death, injury, or disability of a human
724 being, exclusive of the coverages under:
725 (A) Subsection [
726 (B) Subsection [
727 (C) Subsection [
728 (iii) for loss or damage to property resulting from an accident to or explosion of a
729 boiler, pipe, pressure container, machinery, or apparatus;
730 (iv) for loss or damage to property caused by:
731 (A) the breakage or leakage of a sprinkler, water pipe, or water container; or
732 (B) water entering through a leak or opening in a building; or
733 (v) for other loss or damage properly the subject of insurance not within another kind
734 of insurance as defined in this chapter, if the insurance is not contrary to law or public policy.
735 (b) "Liability insurance" includes:
736 (i) vehicle liability insurance;
737 (ii) residential dwelling liability insurance; and
738 (iii) making inspection of, and issuing a certificate of inspection upon, an elevator,
739 boiler, machinery, or apparatus of any kind when done in connection with insurance on the
740 elevator, boiler, machinery, or apparatus.
742 an activity that is part of or related to the insurance business.
743 (b) "License" includes a certificate of authority issued to an insurer.
745 (i) insurance on a human life; and
746 (ii) insurance pertaining to or connected with human life.
747 (b) The business of life insurance includes:
748 (i) granting a death benefit;
749 (ii) granting an annuity benefit;
750 (iii) granting an endowment benefit;
751 (iv) granting an additional benefit in the event of death by accident;
752 (v) granting an additional benefit to safeguard the policy against lapse; and
753 (vi) providing an optional method of settlement of proceeds.
755 (a) is issued for a specific product of insurance; and
756 (b) limits an individual or agency to transact only for that product or insurance.
759 (a) credit life;
760 (b) credit accident and health;
761 (c) credit property;
762 (d) credit unemployment;
763 (e) involuntary unemployment;
764 (f) mortgage life;
765 (g) mortgage guaranty;
766 (h) mortgage accident and health;
767 (i) guaranteed automobile protection; and
768 (j) another form of insurance offered in connection with an extension of credit that:
769 (i) is limited to partially or wholly extinguishing the credit obligation; and
770 (ii) the commissioner determines by rule should be designated as a form of limited line
771 credit insurance.
773 solicits, or negotiates one or more forms of limited line credit insurance coverage to an
774 individual through a master, corporate, group, or individual policy.
776 (a) bail bond;
777 (b) limited line credit insurance;
778 (c) legal expense insurance;
779 (d) motor club insurance;
780 (e) [
781 (f) travel insurance;
782 (g) crop insurance;
783 (h) self-service storage insurance; [
784 (i) guaranteed asset protection waiver; and
786 should be designated a form of limited line insurance.
788 (a) the lines of insurance listed in Subsection [
789 (b) a customer service representative.
791 limited lines insurance.
793 advertised, marketed, offered, or designated to provide coverage:
794 (i) in a setting other than an acute care unit of a hospital;
795 (ii) for not less than 12 consecutive months for a covered person on the basis of:
796 (A) expenses incurred;
797 (B) indemnity;
798 (C) prepayment; or
799 (D) another method;
800 (iii) for one or more necessary or medically necessary services that are:
801 (A) diagnostic;
802 (B) preventative;
803 (C) therapeutic;
804 (D) rehabilitative;
805 (E) maintenance; or
806 (F) personal care; and
807 (iv) that may be issued by:
808 (A) an insurer;
809 (B) a fraternal benefit society;
810 (C) (I) a nonprofit health hospital; and
811 (II) a medical service corporation;
812 (D) a prepaid health plan;
813 (E) a health maintenance organization; or
814 (F) an entity similar to the entities described in Subsections [
815 through (E) to the extent that the entity is otherwise authorized to issue life or health care
817 (b) "Long-term care insurance" includes:
818 (i) any of the following that provide directly or supplement long-term care insurance:
819 (A) a group or individual annuity or rider; or
820 (B) a life insurance policy or rider;
821 (ii) a policy or rider that provides for payment of benefits on the basis of:
822 (A) cognitive impairment; or
823 (B) functional capacity; or
824 (iii) a qualified long-term care insurance contract.
825 (c) "Long-term care insurance" does not include:
826 (i) a policy that is offered primarily to provide basic Medicare supplement coverage;
827 (ii) basic hospital expense coverage;
828 (iii) basic medical/surgical expense coverage;
829 (iv) hospital confinement indemnity coverage;
830 (v) major medical expense coverage;
831 (vi) income replacement or related asset-protection coverage;
832 (vii) accident only coverage;
833 (viii) coverage for a specified:
834 (A) disease; or
835 (B) accident;
836 (ix) limited benefit health coverage; or
837 (x) a life insurance policy that accelerates the death benefit to provide the option of a
838 lump sum payment:
839 (A) if the following are not conditioned on the receipt of long-term care:
840 (I) benefits; or
841 (II) eligibility; and
842 (B) the coverage is for one or more the following qualifying events:
843 (I) terminal illness;
844 (II) medical conditions requiring extraordinary medical intervention; or
845 (III) permanent institutional confinement.
847 incident to the practice and provision of a medical service other than the practice and provision
848 of a dental service.
852 must be constantly maintained by a stock insurance corporation as required by statute.
854 connection with an extension of credit that provides indemnity for payments coming due on a
855 mortgage while the debtor is disabled.
857 mortgagee or other creditor is indemnified against losses caused by the default of a debtor.
859 connection with an extension of credit that pays if the debtor dies.
861 (a) licensed under:
862 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
863 (ii) Chapter 11, Motor Clubs; or
864 (iii) Chapter 14, Foreign Insurers; and
865 (b) that promises for an advance consideration to provide for a stated period of time
866 one or more:
867 (i) legal services under Subsection 31A-11-102 (1)(b);
868 (ii) bail services under Subsection 31A-11-102 (1)(c); or
869 (iii) (A) trip reimbursement;
870 (B) towing services;
871 (C) emergency road services;
872 (D) stolen automobile services;
873 (E) a combination of the services listed in Subsections [
874 (D); or
875 (F) other services given in Subsections 31A-11-102 (1)(b) through (f).
878 (a) that is issued by an insurer; and
879 (b) under which the financing and delivery of medical care is provided, in whole or in
880 part, through a defined set of providers under contract with the insurer, including the financing
881 and delivery of an item paid for as medical care.
883 not entitled to receive a dividend representing a share of the surplus of the insurer.
885 (a) ships or hulls of ships;
886 (b) goods, freight, cargoes, merchandise, effects, disbursements, profits, money,
887 securities, choses in action, evidences of debt, valuable papers, bottomry, respondentia
888 interests, or other cargoes in or awaiting transit over the oceans or inland waterways;
889 (c) earnings such as freight, passage money, commissions, or profits derived from
890 transporting goods or people upon or across the oceans or inland waterways; or
891 (d) a vessel owner or operator as a result of liability to employees, passengers, bailors,
892 owners of other vessels, owners of fixed objects, customs or other authorities, or other persons
893 in connection with maritime activity.
896 health insurance policy.
898 entitled to receive a dividend representing a share of the surplus of the insurer.
900 relating to the minimum percentage of eligible employees that must be enrolled in relation to
901 the total number of eligible employees of an employer reduced by each eligible employee who
902 voluntarily declines coverage under the plan because the employee:
903 (a) has other group health care insurance coverage; or
904 (b) receives:
905 (i) Medicare, under the Health Insurance for the Aged Act, Title XVIII of the Social
906 Security Amendments of 1965; or
907 (ii) another government health benefit.
909 (a) an individual;
910 (b) a partnership;
911 (c) a corporation;
912 (d) an incorporated or unincorporated association;
913 (e) a joint stock company;
914 (f) a trust;
915 (g) a limited liability company;
916 (h) a reciprocal;
917 (i) a syndicate; or
918 (j) another similar entity or combination of entities acting in concert.
920 coverage sold for primarily noncommercial purposes to:
921 (a) an individual; or
922 (b) a family.
925 (a) the year that is designated as the plan year in:
926 (i) the plan document of a group health plan; or
927 (ii) a summary plan description of a group health plan;
928 (b) if the plan document or summary plan description does not designate a plan year or
929 there is no plan document or summary plan description:
930 (i) the year used to determine deductibles or limits;
931 (ii) the policy year, if the plan does not impose deductibles or limits on a yearly basis;
933 (iii) the employer's taxable year if:
934 (A) the plan does not impose deductibles or limits on a yearly basis; and
935 (B) (I) the plan is not insured; or
936 (II) the insurance policy is not renewed on an annual basis; or
937 (c) in a case not described in Subsection [
939 application that:
940 (i) purports to be an enforceable contract; and
941 (ii) memorializes in writing some or all of the terms of an insurance contract.
942 (b) "Policy" includes a service contract issued by:
943 (i) a motor club under Chapter 11, Motor Clubs;
944 (ii) a service contract provided under Chapter 6a, Service Contracts; and
945 (iii) a corporation licensed under:
946 (A) Chapter 7, Nonprofit Health Service Insurance Corporations; or
947 (B) Chapter 8, Health Maintenance Organizations and Limited Health Plans.
948 (c) "Policy" does not include:
949 (i) a certificate under a group insurance contract; or
950 (ii) a document that does not purport to have legal effect.
952 contract by ownership, premium payment, or otherwise.
954 nonguaranteed elements of a policy of life insurance over a period of years.
956 insurance policy.
958 (a) means a condition that was present before the effective date of coverage, whether or
959 not medical advice, diagnosis, care, or treatment was recommended or received before that day;
961 (b) does not include a condition indicated by genetic information unless an actual
962 diagnosis of the condition by a physician has been made.
964 (b) "Premium" includes, however designated:
965 (i) an assessment;
966 (ii) a membership fee;
967 (iii) a required contribution; or
968 (iv) monetary consideration.
969 (c) (i) "Premium" does not include consideration paid to a third party administrator for
970 the third party administrator's services.
971 (ii) "Premium" includes an amount paid by a third party administrator to an insurer for
972 insurance on the risks administered by the third party administrator.
974 Subsection 31A-5-203 (3).
977 incident to the practice of a profession and provision of a professional service.
979 insurance" means insurance against loss or damage to real or personal property of every kind
980 and any interest in that property:
981 (i) from all hazards or causes; and
982 (ii) against loss consequential upon the loss or damage including vehicle
983 comprehensive and vehicle physical damage coverages.
984 (b) "Property insurance" does not include:
985 (i) inland marine insurance; and
986 (ii) ocean marine insurance.
988 long-term care insurance contract" means:
989 (a) an individual or group insurance contract that meets the requirements of Section
990 7702B(b), Internal Revenue Code; or
991 (b) the portion of a life insurance contract that provides long-term care insurance:
992 (i) (A) by rider; or
993 (B) as a part of the contract; and
994 (ii) that satisfies the requirements of Sections 7702B(b) and (e), Internal Revenue
997 (a) is:
998 (i) organized under the laws of the United States or any state; or
999 (ii) in the case of a United States office of a foreign banking organization, licensed
1000 under the laws of the United States or any state;
1001 (b) is regulated, supervised, and examined by a United States federal or state authority
1002 having regulatory authority over a bank or trust company; and
1003 (c) meets the standards of financial condition and standing that are considered
1004 necessary and appropriate to regulate the quality of a financial institution whose letters of credit
1005 will be acceptable to the commissioner as determined by:
1006 (i) the commissioner by rule; or
1007 (ii) the Securities Valuation Office of the National Association of Insurance
1010 (i) the cost of a given unit of insurance; or
1011 (ii) for property or casualty insurance, that cost of insurance per exposure unit either
1012 expressed as:
1013 (A) a single number; or
1014 (B) a pure premium rate, adjusted before the application of individual risk variations
1015 based on loss or expense considerations to account for the treatment of:
1016 (I) expenses;
1017 (II) profit; and
1018 (III) individual insurer variation in loss experience.
1019 (b) "Rate" does not include a minimum premium.
1021 organization" means a person who assists an insurer in rate making or filing by:
1022 (i) collecting, compiling, and furnishing loss or expense statistics;
1023 (ii) recommending, making, or filing rates or supplementary rate information; or
1024 (iii) advising about rate questions, except as an attorney giving legal advice.
1025 (b) "Rate service organization" does not mean:
1026 (i) an employee of an insurer;
1027 (ii) a single insurer or group of insurers under common control;
1028 (iii) a joint underwriting group; or
1029 (iv) an individual serving as an actuarial or legal consultant.
1031 renewal policy premiums:
1032 (a) a manual of rates;
1033 (b) a classification;
1034 (c) a rate-related underwriting rule; and
1035 (d) a rating formula that describes steps, policies, and procedures for determining
1036 initial and renewal policy premiums.
1038 (a) the date delivered to and stamped received by the department, if delivered in
1040 (b) the post mark date, if delivered by mail;
1041 (c) the delivery service's post mark or pickup date, if delivered by a delivery service;
1042 (d) the received date recorded on an item delivered, if delivered by:
1043 (i) facsimile;
1044 (ii) email; or
1045 (iii) another electronic method; or
1046 (e) a date specified in:
1047 (i) a statute;
1048 (ii) a rule; or
1049 (iii) an order.
1051 association of persons:
1052 (a) operating through an attorney-in-fact common to all of the persons; and
1053 (b) exchanging insurance contracts with one another that provide insurance coverage
1054 on each other.
1056 consideration, transfers any portion of the risk it has assumed to another insurer. In referring to
1057 reinsurance transactions, this title sometimes refers to:
1058 (a) the insurer transferring the risk as the "ceding insurer"; and
1059 (b) the insurer assuming the risk as the:
1060 (i) "assuming insurer"; or
1061 (ii) "assuming reinsurer."
1063 authority to assume reinsurance.
1065 liability resulting from or incident to the ownership, maintenance, or use of a residential
1066 dwelling that is a detached single family residence or multifamily residence up to four units.
1068 assumed under a reinsurance contract.
1069 (b) A reinsurer "retrocedes" when the reinsurer reinsures with another insurer part of a
1070 liability assumed under a reinsurance contract.
1072 (a) an insurance policy; or
1073 (b) an insurance certificate.
1075 (i) note;
1076 (ii) stock;
1077 (iii) bond;
1078 (iv) debenture;
1079 (v) evidence of indebtedness;
1080 (vi) certificate of interest or participation in a profit-sharing agreement;
1081 (vii) collateral-trust certificate;
1082 (viii) preorganization certificate or subscription;
1083 (ix) transferable share;
1084 (x) investment contract;
1085 (xi) voting trust certificate;
1086 (xii) certificate of deposit for a security;
1087 (xiii) certificate of interest of participation in an oil, gas, or mining title or lease or in
1088 payments out of production under such a title or lease;
1089 (xiv) commodity contract or commodity option;
1090 (xv) certificate of interest or participation in, temporary or interim certificate for,
1091 receipt for, guarantee of, or warrant or right to subscribe to or purchase any of the items listed
1092 in Subsections [
1093 (xvi) another interest or instrument commonly known as a security.
1094 (b) "Security" does not include:
1095 (i) any of the following under which an insurance company promises to pay money in a
1096 specific lump sum or periodically for life or some other specified period:
1097 (A) insurance;
1098 (B) an endowment policy; or
1099 (C) an annuity contract; or
1100 (ii) a burial certificate or burial contract.
1102 exclusion from coverage in accident and health insurance.
1104 provides for spreading its own risks by a systematic plan.
1106 include an arrangement under which a number of persons spread their risks among themselves.
1108 (i) an arrangement by which a governmental entity undertakes to indemnify an
1109 employee for liability arising out of the employee's employment; and
1110 (ii) an arrangement by which a person with a managed program of self-insurance and
1111 risk management undertakes to indemnify its affiliates, subsidiaries, directors, officers, or
1112 employees for liability or risk that is related to the relationship or employment.
1116 (a) by any means;
1117 (b) for money or its equivalent; and
1118 (c) on behalf of an insurance company.
1120 advertised, marketed, offered, or designed to provide coverage that is similar to long-term care
1121 insurance, but that provides coverage for less than 12 consecutive months for each covered
1124 during each of which an individual does not have creditable coverage.
1126 employer who, with respect to a calendar year and to a plan year:
1127 (a) employed an average of at least two employees but not more than 50 eligible
1128 employees on each business day during the preceding calendar year; and
1129 (b) employs at least two employees on the first day of the plan year.
1131 the same meaning as provided in federal regulations adopted pursuant to the Health Insurance
1132 Portability and Accountability Act [
1134 either directly or indirectly through one or more affiliates or intermediaries.
1135 (b) "Wholly owned subsidiary" of a person is a subsidiary of which all of the voting
1136 shares are owned by that person either alone or with its affiliates, except for the minimum
1137 number of shares the law of the subsidiary's domicile requires to be owned by directors or
1140 (a) a guarantee against loss or damage resulting from the failure of a principal to pay or
1141 perform the principal's obligations to a creditor or other obligee;
1142 (b) bail bond insurance; and
1143 (c) fidelity insurance.
1145 and liabilities.
1146 (b) (i) "Permanent surplus" means the surplus of a mutual insurer that is designated by
1147 the insurer as permanent.
1148 (ii) Sections 31A-5-211 , 31A-7-201 , 31A-8-209 , 31A-9-209 , and 31A-14-209 require
1149 that mutuals doing business in this state maintain specified minimum levels of permanent
1151 (iii) Except for assessable mutuals, the minimum permanent surplus requirement is the
1152 same as the minimum required capital requirement that applies to stock insurers.
1153 (c) "Excess surplus" means:
1154 (i) for a life insurer, accident and health insurer, health organization, or property and
1155 casualty insurer as defined in Section 31A-17-601 , the lesser of:
1156 (A) that amount of an insurer's or health organization's total adjusted capital that
1157 exceeds the product of:
1158 (I) 2.5; and
1159 (II) the sum of the insurer's or health organization's minimum capital or permanent
1160 surplus required under Section 31A-5-211 , 31A-9-209 , or 31A-14-205 ; or
1161 (B) that amount of an insurer's or health organization's total adjusted capital that
1162 exceeds the product of:
1163 (I) 3.0; and
1164 (II) the authorized control level RBC as defined in Subsection 31A-17-601 (8)(a); and
1165 (ii) for a monoline mortgage guaranty insurer, financial guaranty insurer, or title insurer
1166 that amount of an insurer's paid-in-capital and surplus that exceeds the product of:
1167 (A) 1.5; and
1168 (B) the insurer's total adjusted capital required by Subsection 31A-17-609 (1).
1170 collects charges or premiums from, or who, for consideration, adjusts or settles claims of
1171 residents of the state in connection with insurance coverage, annuities, or service insurance
1172 coverage, except:
1173 (a) a union on behalf of its members;
1174 (b) a person administering a:
1175 (i) pension plan subject to the federal Employee Retirement Income Security Act of
1177 (ii) governmental plan as defined in Section 414(d), Internal Revenue Code; or
1178 (iii) nonelecting church plan as described in Section 410(d), Internal Revenue Code;
1179 (c) an employer on behalf of the employer's employees or the employees of one or
1180 more of the subsidiary or affiliated corporations of the employer;
1181 (d) an insurer licensed under [
1182 line of insurance for which the insurer holds a license in this state[
1183 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
1184 (ii) Chapter 7, Nonprofit Health Service Insurance Corporations;
1185 (iii) Chapter 8, Health Maintenance Organizations and Limited Health Plans;
1186 (iv) Chapter 9, Insurance Fraternals; or
1187 (v) Chapter 14, Foreign Insurers; or
1188 (e) a person:
1189 (i) licensed or exempt from licensing under:
1190 (A) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
1191 Reinsurance Intermediaries; or
1192 (B) Chapter 26, Insurance Adjusters; and
1193 (ii) whose activities are limited to those authorized under the license the person holds
1194 or for which the person is exempt.
1196 owner of real or personal property or the holder of liens or encumbrances on that property, or
1197 others interested in the property against loss or damage suffered by reason of liens or
1198 encumbrances upon, defects in, or the unmarketability of the title to the property, or invalidity
1199 or unenforceability of any liens or encumbrances on the property.
1201 organization's statutory capital and surplus as determined in accordance with:
1202 (a) the statutory accounting applicable to the annual financial statements required to be
1203 filed under Section 31A-4-113 ; and
1204 (b) another item provided by the RBC instructions, as RBC instructions is defined in
1205 Section 31A-17-601 .
1207 a corporation.
1208 (b) "Trustee," when used in reference to an employee welfare fund, means an
1209 individual, firm, association, organization, joint stock company, or corporation, whether acting
1210 individually or jointly and whether designated by that name or any other, that is charged with
1211 or has the overall management of an employee welfare fund.
1213 insurer" means an insurer:
1214 (i) not holding a valid certificate of authority to do an insurance business in this state;
1216 (ii) transacting business not authorized by a valid certificate.
1217 (b) "Admitted insurer" or "authorized insurer" means an insurer:
1218 (i) holding a valid certificate of authority to do an insurance business in this state; and
1219 (ii) transacting business as authorized by a valid certificate.
1223 from or incident to ownership, maintenance, or use of a land vehicle or aircraft, exclusive of a
1224 vehicle comprehensive or vehicle physical damage coverage under Subsection [
1226 security convertible into a security with a voting right associated with the security.
1228 pass before coverage for an individual, who is otherwise eligible to enroll under the terms of
1229 the health benefit plan, can become effective.
1231 (a) insurance for indemnification of an employer against liability for compensation
1232 based on:
1233 (i) a compensable accidental injury; and
1234 (ii) occupational disease disability;
1235 (b) employer's liability insurance incidental to workers' compensation insurance and
1236 written in connection with workers' compensation insurance; and
1237 (c) insurance assuring to a person entitled to workers' compensation benefits the
1238 compensation provided by law.
1239 Section 2. Section 31A-2-208 is amended to read:
1240 31A-2-208. Publications.
1241 (1) The commissioner may prepare and distribute books, pamphlets, and other
1242 publications relating to insurance. Except as otherwise provided under this title, the
1244 those desiring to receive [
1245 charged for [
1247 Restricted Account, created in Section 59-9-105 , to be used as provided in Section 59-9-105 .
1248 (2) The commissioner shall have the annual report required in Subsection
1249 31A-2-207 (5) printed:
1250 (a) in a form determined by [
1251 (b) in sufficient numbers to meet [
1252 (3) The commissioner shall publish in [
1253 31A-2-207 (5) an up-to-date chart and explanation of the organization of [
1254 commissioner's office, making clear the allocation of responsibility and authority among the
1255 staff. This [
1257 Section 3. Section 31A-2-212 is amended to read:
1258 31A-2-212. Miscellaneous duties.
1259 (1) Upon issuance of [
1260 person's authority to do business in Utah, and [
1261 commissioner begins a proceeding against [
1262 Receivership Act, the commissioner:
1263 (a) shall notify by mail [
1264 commissioner has record; and
1265 (b) may publish notice of the order or proceeding in any manner the commissioner
1266 considers necessary to protect the rights of the public.
1267 (2) When required for evidence in [
1268 furnish a certificate of [
1269 insurance in Utah on any particular date. The court or other officer shall receive the certificate
1270 of authority in lieu of the commissioner's testimony.
1271 (3) (a) On the request of [
1272 commissioner shall furnish a copy of the insurer's certificate of authority to [
1273 public officer in this state who requires that certificate of authority before accepting a bond.
1274 (b) The public officer described in Subsection (3)(a) shall file the certificate of
1275 authority furnished under Subsection (3)(a).
1276 (c) After a certified copy of a certificate of authority [
1277 officer, it is not necessary, while the certificate of authority remains effective, to attach a copy
1278 of it to any instrument of suretyship filed with that public officer.
1279 (d) Whenever the commissioner revokes the certificate of authority or [
1281 an insurer authorized to do a surety business, the commissioner shall immediately give notice
1282 of that action to each public officer who [
1283 (4) (a) The commissioner shall immediately notify every judge and clerk of [
1284 courts of record in the state when:
1285 (i) an authorized insurer doing a surety business:
1286 (A) files a petition for receivership; or
1287 (B) is in receivership; or
1288 (ii) the commissioner has reason to believe that the authorized insurer doing surety
1290 (A) is in financial difficulty; or
1291 (B) has unreasonably failed to carry out any of its contracts.
1292 (b) Upon the receipt of the notice required by this Subsection (4), it is the duty of the
1293 judges and clerks to notify and require [
1294 bond on which the authorized insurer doing surety business is surety[
1295 new bond with a new surety.
1296 (5) The commissioner shall require an insurer that issues, sells, renews, or offers health
1297 insurance coverage in this state to comply with the Health Insurance Portability and
1298 Accountability Act[
1299 Section 4. Section 31A-3-101 is amended to read:
1300 31A-3-101. General finance provisions.
1302 expenditures shall conform to the Legislature's appropriation adopted under Title 63J, Chapter
1303 1, Budgetary Procedures Act.
1307 Section 5. Section 31A-3-103 is amended to read:
1308 31A-3-103. Fees.
1309 (1) For purposes of this section, "services" means functions that are reasonable and
1310 necessary to enable the commissioner to perform the duties imposed by this title including:
1311 (a) issuing or renewing a license or certificate of authority;
1312 (b) filing a policy form;
1313 (c) reporting a producer appointment or termination; and
1314 (d) filing an annual statement.
1315 (2) Except as otherwise provided by this title:
1316 (a) the commissioner may set and collect a fee for services provided by the
1318 (b) a fee related to the renewal of a license may be imposed no more frequently than
1319 once each year; and
1320 (c) a fee charged by the commissioner shall be set in accordance with Section
1321 63J-1-504 .
1325 this section.
1326 (b) The commissioner shall, by rule, establish the deadlines for payment of a fee
1327 established pursuant to this section.
1328 (4) (a) Beginning July 1, 2011, there is created in the General Fund a restricted account
1329 known as the "Insurance Department Restricted Account."
1330 (b) Except as provided in Subsection (4)(c), the Insurance Department Restricted
1331 Account shall consist of:
1332 (i) fees authorized by this section; and
1333 (ii) other money received by the department, including:
1334 (A) reimbursements for examination costs incurred by the department; and
1335 (B) forfeitures collected under this title.
1336 (c) The department shall deposit money it receives that is subject to a restricted account
1337 or enterprise fund created by this title into the restricted account or enterprise fund in
1338 accordance with the statute creating the restricted account or enterprise fund, and the
1339 department may not deposit the money into the Insurance Department Restricted Account.
1340 (d) Subject to appropriation by the Legislature, the department may expend money in
1341 the Insurance Department Restricted Account to fund the operations of the department.
1342 (e) At the end of each fiscal year, the director of the Division of Finance shall transfer
1343 into the General Fund any money deposited into the Insurance Department Restricted Account
1344 under Subsection (4)(b) that exceeds the legislative appropriations from the Insurance
1345 Department Restricted Account for that year.
1346 Section 6. Section 31A-3-304 is amended to read:
1347 31A-3-304. Annual fees -- Other taxes or fees prohibited -- Captive Insurance
1348 Restricted Account.
1349 (1) (a) A captive insurance company shall pay an annual fee imposed under this section
1350 to obtain or renew a certificate of authority.
1351 (b) The commissioner shall:
1352 (i) determine the annual fee pursuant to Section 31A-3-103 ; and
1353 (ii) consider whether the annual fee is competitive with fees imposed by other states on
1354 captive insurance companies.
1355 (2) A captive insurance company that fails to pay the fee required by this section is
1356 subject to the relevant sanctions of this title.
1357 (3) (a) Except as provided in Subsection (3)[
1358 Chapter 9, Taxation of Admitted Insurers, [
1360 state that may be [
1364 (i) a fee under this section;
1365 (ii) a fee under Chapter 37, Captive Insurance Companies Act; and
1366 (iii) a fee under Chapter 37a, Special Purpose Financial Captive Insurance Company
1368 (b) The state or a county, city, or town within the state may not levy or collect an
1369 occupation tax or other tax, fee, or charge not described in Subsections (3)(a)(i) through (iii)
1370 against a captive insurance company.
1371 (c) The state may not levy, assess, or collect a withdrawal fee under Section 31A-4-115
1372 against a captive insurance company.
1373 (d) A captive insurance company is subject to real and personal property taxes.
1374 (4) A captive insurance company shall pay the fee imposed by this section to the
1375 commissioner by [
1376 (5) (a) Money received pursuant to [
1377 (3)(a) shall be deposited into the Captive Insurance Restricted Account.
1378 (b) There is created in the General Fund a restricted account known as the "Captive
1379 Insurance Restricted Account."
1380 (c) The Captive Insurance Restricted Account shall consist of the fees [
1382 (d) The commissioner shall administer the Captive Insurance Restricted Account.
1383 Subject to appropriations by the Legislature, the commissioner shall use the money deposited
1384 into the Captive Insurance Restricted Account to:
1385 (i) administer and enforce:
1386 (A) Chapter 37, Captive Insurance Companies Act; and
1387 (B) Chapter 37a, Special Purpose Financial Captive Insurance Company Act; and
1388 (ii) promote the captive insurance industry in Utah.
1389 (e) An appropriation from the Captive Insurance Restricted Account is nonlapsing,
1390 except that at the end of each fiscal year, money received by the commissioner in excess of
1392 Section 7. Section 31A-14-211 is amended to read:
1393 31A-14-211. Restrictions on foreign title insurers.
1394 (1) An authorized foreign title insurer may not insure property in this state except:
1395 (a) through a title insurance producer who is a resident in Utah; or
1396 (b) through a bona fide [
1397 (i) that is under the direction and control of the authorized foreign title insurer [
1399 (ii) for which the authorized foreign title insurer pays the expenses [
1401 (iii) at which a person may request information about title services related to a real
1402 estate transaction for which the person is a party;
1403 (iv) at which a person may deliver written communications to the authorized foreign
1404 title insurer as required by the real estate transaction for which the person is a party; and
1405 (v) at which a person may deliver escrow money related to a real estate transaction for
1406 which the person is a party.
1408 (2) This section does not apply to reinsurance.
1409 Section 8. Section 31A-22-607 is amended to read:
1410 31A-22-607. Grace period.
1411 (1) [
1412 contain one or more clauses providing for a grace period for premium payment only of:
1413 (i) at least 15 days for a weekly or monthly premium [
1414 (ii) 30 days for [
1415 policy, for each premium after the first premium payment. [
1416 (b) An insurer may elect to include a grace period that is longer than 15 days for a
1417 weekly or monthly [
1419 force during [
1421 individual or franchise accident and health insurance policy continues in force with no gap in
1424 expires, the [
1425 terminated as of the last date for which the premium [
1427 individual or franchise accident and health insurance policy be discontinued.
1428 (2) [
1429 for a grace period of at least 30 days, unless the policyholder gives written notice of
1430 discontinuance [
1431 terms. [
1432 (b) A group or blanket accident and health insurance policy is in force during a grace
1434 (c) If an insurer does not receive payment before a grace period expires, the group or
1435 blanket accident and health insurance policy is terminated as of the last day of the grace period.
1436 (d) A group or blanket accident and health insurance policy may provide for payment
1437 of a pro rata premium for the period the group or blanket accident and health insurance policy
1438 is in effect during [
1439 (3) If [
1440 health insurance policy, [
1441 provided in the accident and health insurance policy, be cut off by compliance with the notice
1442 provision under Subsection 31A-21-303 (4)(b).
1443 Section 9. Section 31A-22-610.6 is amended to read:
1444 31A-22-610.6. Special enrollment for individuals receiving premium assistance.
1445 (1) As used in this section:
1446 (a) "Premium assistance" means assistance under Title 26, Chapter 18, Medical
1447 Assistance Act, in the payment of premium.
1448 (b) "Qualified beneficiary" means an individual who is approved to receive premium
1450 (2) Subject to the other provisions in this section, an individual may enroll under this
1451 section at a time outside of an employer health benefit plan open enrollment period, regardless
1452 of previously waiving coverage, if the individual is:
1453 (a) a qualified beneficiary who is eligible for coverage as an employee under the
1454 employer health benefit plan; or
1455 (b) a dependent of the qualified beneficiary who is eligible for coverage under the
1456 employer health benefit plan.
1457 (3) To be eligible to enroll outside of an open enrollment period, an individual
1458 described in Subsection (2) shall enroll in the employer health benefit plan by no later than 30
1459 days from the day on which the qualified beneficiary receives initial written notification, after
1460 July 1, 2008, that the qualified beneficiary is eligible to receive premium assistance.
1461 (4) An individual described in Subsection (2) may enroll under this section only in an
1462 employer health benefit plan that is available at the time of enrollment to similarly situated
1463 eligible employees or dependents of eligible employees.
1464 (5) Coverage under an employer health benefit plan for an individual described in
1465 Subsection (2) may begin as soon as the first day of the month immediately following
1466 enrollment of the individual in accordance with this section.
1467 (6) This section does not modify any requirement related to premiums that applies
1468 under an employer health benefit plan to a similarly situated eligible employee or dependent of
1469 an eligible employee under the employer health benefit plan.
1470 (7) An employer health benefit plan may require an individual described in Subsection
1471 (2) to satisfy a preexisting condition waiting period that:
1472 (a) is allowed under the Health Insurance Portability and Accountability Act [
1474 (b) is not longer than 12 months.
1475 Section 10. Section 31A-22-614.5 is amended to read:
1476 31A-22-614.5. Uniform claims processing -- Electronic exchange of health
1478 (1) (a) Except as provided in Subsection (1)(c), all insurers offering health insurance
1479 shall use a uniform claim form and uniform billing and claim codes.
1480 (b) Beginning January 1, 2011, all health benefit plans, and dental and vision plans,
1481 shall provide for the electronic exchange of uniform:
1482 (i) eligibility and coverage information; and
1483 (ii) coordination of benefits information.
1484 (c) For purposes of Subsection (1)(a), "health insurance" does not include a policy or
1485 certificate that provides benefits solely for:
1486 (i) income replacement; or
1487 (ii) long-term care.
1488 (2) (a) The uniform electronic standards and information required in Subsection (1)
1489 shall be adopted and approved by the commissioner in accordance with Title 63G, Chapter 3,
1490 Utah Administrative Rulemaking Act.
1491 (b) When adopting rules under this section the commissioner:
1492 (i) shall:
1493 (A) consult with national and state organizations involved with the standardized
1494 exchange of health data, and the electronic exchange of health data, to develop the standards
1495 for the use and electronic exchange of uniform:
1496 (I) claim forms;
1497 (II) billing and claim codes;
1498 (III) insurance eligibility and coverage information; and
1499 (IV) coordination of benefits information; and
1500 (B) meet federal mandatory minimum standards following the adoption of national
1501 requirements for transaction and data elements in the federal Health Insurance Portability and
1502 Accountability Act [
1503 (ii) may not require an insurer or administrator to use a specific software product or
1504 vendor; and
1505 (iii) may require an insurer who participates in the all payer database created under
1506 Section 26-33a-106.1 to allow data regarding demographic and insurance coverage information
1507 to be electronically shared with the state's designated secure health information master person
1508 index to be used:
1509 (A) in compliance with data security standards established by:
1510 (I) the federal Health Insurance Portability and Accountability Act [
1512 (II) the electronic commerce agreements established in a business associate agreement;
1514 (B) for the purpose of coordination of health benefit plans.
1515 (3) (a) The commissioner shall coordinate the administrative rules adopted under the
1516 provisions of this section with the administrative rules adopted by the Department of Health for
1517 the implementation of the standards for the electronic exchange of clinical health information
1518 under Section 26-1-37 . The department shall establish procedures for developing the rules
1519 adopted under this section, which ensure that the Department of Health is given the opportunity
1520 to comment on proposed rules.
1521 (b) (i) The commissioner may provide information to health care providers regarding
1522 resources available to a health care provider to verify whether a health care provider's practice
1523 management software system meets the uniform electronic standards for data exchange
1524 required by this section.
1525 (ii) The commissioner may provide the information described in Subsection (3)(b)(i)
1526 by partnering with:
1527 (A) a not-for-profit, broad based coalition of state health care insurers and health care
1528 providers who are involved in the electronic exchange of the data required by this section; or
1529 (B) some other person that the commissioner determines is appropriate to provide the
1530 information described in Subsection (3)(b)(i).
1531 (c) The commissioner shall regulate any fees charged by insurers to the providers for:
1532 (i) uniform claim forms;
1533 (ii) electronic billing; or
1534 (iii) the electronic exchange of clinical health information permitted by Section
1535 26-1-37 .
1536 Section 11. Section 31A-22-618.5 is amended to read:
1537 31A-22-618.5. Health benefit plan offerings.
1538 (1) The purpose of this section is to increase the range of health benefit plans available
1539 in the small group, small employer group, large group, and individual insurance markets.
1540 (2) A health maintenance organization that is subject to Chapter 8, Health Maintenance
1541 Organizations and Limited Health Plans:
1542 (a) shall offer to potential purchasers at least one health benefit plan that is subject to
1543 the requirements of Chapter 8, Health Maintenance Organizations and Limited Health Plans;
1545 (b) may offer to a potential purchaser one or more health benefit plans that:
1546 (i) are not subject to one or more of the following:
1547 (A) the limitations on insured indemnity benefits in Subsection 31A-8-105 (4);
1548 (B) the limitation on point of service products in Subsections 31A-8-408 (3) through
1550 (C) except as provided in Subsection (2)(b)(ii), basic health care services as defined in
1551 Section 31A-8-101 ; or
1552 (D) coverage mandates enacted after January 1, 2009 that are not required by federal
1553 law, provided that the insurer offers one plan under Subsection (2)(a) that covers the mandate
1554 enacted after January 1, 2009; and
1555 (ii) when offering a health plan under this section, provide coverage for an emergency
1556 medical condition as required by Section 31A-22-627 as follows:
1557 (A) within the organization's service area, covered services shall include health care
1558 services from non-affiliated providers when medically necessary to stabilize an emergency
1559 medical condition; and
1560 (B) outside the organization's service area, covered services shall include medically
1561 necessary health care services for the treatment of an emergency medical condition that are
1562 immediately required while the enrollee is outside the geographic limits of the organization's
1563 service area.
1564 (3) An insurer that offers a health benefit plan that is not subject to Chapter 8, Health
1565 Maintenance Organizations and Limited Health Plans:
1566 (a) notwithstanding Subsection 31A-22-617 (2), may offer a health benefit plan that
1567 groups providers into the following reimbursement levels:
1568 (i) tier one contracted providers;
1569 (ii) tier two contracted providers who the insurer must reimburse at least 75% of tier
1570 one providers; and
1571 (iii) one or more tiers of non-contracted providers; [
1572 (b) notwithstanding Subsection 31A-22-617 (9) may offer a health benefit plan that is
1573 not subject to Section 31A-22-618 ;
1574 (c) beginning July 1, 2012, may offer [
1575 plans that:
1576 (i) are not subject to Subsection 31A-22-617 (2); and
1577 (ii) are subject to the reimbursement requirements in Section 31A-8-501 ;
1578 (d) when offering a health plan under this Subsection (3), shall provide coverage of
1579 emergency care services as required by Section 31A-22-627 by providing coverage at a
1580 reimbursement level of at least 75% of [
1581 contracted provider category; and
1582 (e) are not subject to coverage mandates enacted after January 1, 2009 that are not
1583 required by federal law, provided that an insurer offers one plan that covers a mandate enacted
1584 after January 1, 2009.
1585 (4) Section 31A-8-106 does not prohibit the offer of a health benefit plan under
1586 Subsection (2)(b).
1587 (5) (a) Any difference in price between a health benefit plan offered under Subsections
1588 (2)(a) and (b) shall be based on actuarially sound data.
1589 (b) Any difference in price between a health benefit plan offered under Subsections
1590 (3)(a) and (b) shall be based on actuarially sound data.
1591 (6) Nothing in this section limits the number of health benefit plans that an insurer may
1593 Section 12. Section 31A-22-625 is amended to read:
1594 31A-22-625. Catastrophic coverage of mental health conditions.
1595 (1) As used in this section:
1596 (a) (i) "Catastrophic mental health coverage" means coverage in a health benefit plan
1597 that does not impose a lifetime limit, annual payment limit, episodic limit, inpatient or
1598 outpatient service limit, or maximum out-of-pocket limit that places a greater financial burden
1599 on an insured for the evaluation and treatment of a mental health condition than for the
1600 evaluation and treatment of a physical health condition.
1601 (ii) "Catastrophic mental health coverage" may include a restriction on cost sharing
1602 factors, such as deductibles, copayments, or coinsurance, before reaching a maximum
1603 out-of-pocket limit.
1604 (iii) "Catastrophic mental health coverage" may include one maximum out-of-pocket
1605 limit for physical health conditions and another maximum out-of-pocket limit for mental health
1606 conditions, except that if separate out-of-pocket limits are established, the out-of-pocket limit
1607 for mental health conditions may not exceed the out-of-pocket limit for physical health
1609 (b) (i) "50/50 mental health coverage" means coverage in a health benefit plan that
1610 pays for at least 50% of covered services for the diagnosis and treatment of mental health
1612 (ii) "50/50 mental health coverage" may include a restriction on:
1613 (A) episodic limits;
1614 (B) inpatient or outpatient service limits; or
1615 (C) maximum out-of-pocket limits.
1616 (c) "Large employer" is as defined in 42 U.S.C. Sec. 300gg-91.
1617 (d) (i) "Mental health condition" means a condition or disorder involving mental illness
1618 that falls under a diagnostic category listed in the Diagnostic and Statistical Manual, as
1619 periodically revised.
1620 (ii) "Mental health condition" does not include the following when diagnosed as the
1621 primary or substantial reason or need for treatment:
1622 (A) a marital or family problem;
1623 (B) a social, occupational, religious, or other social maladjustment;
1624 (C) a conduct disorder;
1625 (D) a chronic adjustment disorder;
1626 (E) a psychosexual disorder;
1627 (F) a chronic organic brain syndrome;
1628 (G) a personality disorder;
1629 (H) a specific developmental disorder or learning disability; or
1630 (I) mental retardation.
1631 (e) "Small employer" is as defined in 42 U.S.C. Sec. 300gg-91.
1632 (2) (a) At the time of purchase and renewal, an insurer shall offer to a small employer
1633 that it insures or seeks to insure a choice between catastrophic mental health coverage and
1634 50/50 mental health coverage.
1635 (b) In addition to complying with Subsection (2)(a), an insurer may offer to provide:
1636 (i) catastrophic mental health coverage, 50/50 mental health coverage, or both at levels
1637 that exceed the minimum requirements of this section; or
1638 (ii) coverage that excludes benefits for mental health conditions.
1639 (c) A small employer may, at its option, choose either catastrophic mental health
1640 coverage, 50/50 mental health coverage, or coverage offered under Subsection (2)(b),
1641 regardless of the employer's previous coverage for mental health conditions.
1642 (d) An insurer is exempt from the 30% index rating restriction in Section
1643 31A-30-106.1 and, for the first year only that catastrophic mental health coverage is chosen, the
1644 15% annual adjustment restriction in Section 31A-30-106.1 , for any small employer with 20 or
1645 less enrolled employees who chooses coverage that meets or exceeds catastrophic mental
1646 health coverage.
1647 (3) An insurer shall offer a large employer mental health and substance use disorder
1648 benefit in compliance with Section 2705 of the Public Health Service Act, 42 U.S.C. Sec.
1650 (4) (a) An insurer may provide catastrophic mental health coverage to a small employer
1651 through a managed care organization or system in a manner consistent with Chapter 8, Health
1652 Maintenance Organizations and Limited Health Plans, regardless of whether the insurance
1653 policy uses a managed care organization or system for the treatment of physical health
1655 (b) (i) Notwithstanding any other provision of this title, an insurer may:
1656 (A) establish a closed panel of providers for catastrophic mental health coverage; and
1657 (B) refuse to provide a benefit to be paid for services rendered by a nonpanel provider
1659 (I) the insured is referred to a nonpanel provider with the prior authorization of the
1660 insurer; and
1661 (II) the nonpanel provider agrees to follow the insurer's protocols and treatment
1663 (ii) If an insured receives services from a nonpanel provider in the manner permitted by
1664 Subsection (4)(b)(i)(B), the insurer shall reimburse the insured for not less than 75% of the
1665 average amount paid by the insurer for comparable services of panel providers under a
1666 noncapitated arrangement who are members of the same class of health care providers.
1667 (iii) This Subsection (4)(b) may not be construed as requiring an insurer to authorize a
1668 referral to a nonpanel provider.
1669 (c) To be eligible for catastrophic mental health coverage, a diagnosis or treatment of a
1670 mental health condition must be rendered:
1671 (i) by a mental health therapist as defined in Section 58-60-102 ; or
1672 (ii) in a health care facility:
1673 (A) licensed or otherwise authorized to provide mental health services pursuant to:
1674 (I) Title 26, Chapter 21, Health Care Facility Licensing and Inspection Act; or
1675 (II) Title 62A, Chapter 2, Licensure of Programs and Facilities; and
1676 (B) that provides a program for the treatment of a mental health condition pursuant to a
1677 written plan.
1678 (5) The commissioner may prohibit an insurance policy that provides mental health
1679 coverage in a manner that is inconsistent with this section.
1680 (6) The commissioner shall:
1681 (a) adopt rules, in accordance with Title 63G, Chapter 3, Utah Administrative
1682 Rulemaking Act, as necessary to ensure compliance with this section; and
1683 (b) provide general figures on the percentage of insurance policies that include:
1684 (i) no mental health coverage;
1685 (ii) 50/50 mental health coverage;
1686 (iii) catastrophic mental health coverage; and
1687 (iv) coverage that exceeds the minimum requirements of this section.
1688 (7) This section may not be construed as discouraging or otherwise preventing an
1689 insurer from providing mental health coverage in connection with an individual insurance
1691 (8) This section shall be repealed in accordance with Section 63I-1-231 .
1692 Section 13. Section 31A-22-701 is amended to read:
1693 31A-22-701. Groups eligible for group or blanket insurance.
1694 (1) As used in this section, "association group" means a lawfully formed association of
1695 individuals or business entities that:
1696 (a) purchases insurance on a group basis on behalf of members; and
1697 (b) is formed and maintained in good faith for purposes other than obtaining insurance.
1698 (2) A group [
1699 (a) a group:
1700 (i) to which a group life insurance policy may be issued under Sections 31A-22-502 ,
1701 31A-22-503 , 31A-22-504 , 31A-22-506 , 31A-22-507 , and 31A-22-509 ; and
1702 (ii) that is formed [
1703 good faith for a purpose other than obtaining insurance;
1704 (b) an association group that:
1705 (i) has been actively in existence for at least five years;
1706 (ii) has a constitution and bylaws;
1707 (iii) is formed and maintained in good faith for purposes other than obtaining
1709 (iv) does not condition membership in the association group on any health
1710 status-related factor relating to an individual, including an employee of an employer or a
1711 dependent of an employee;
1712 (v) makes accident and health insurance coverage offered through the association
1713 group available to all members regardless of any health status-related factor relating to the
1714 members or individuals eligible for coverage through a member; [
1715 (vi) does not make accident and health insurance coverage offered through the
1716 association group available other than in connection with a member of the association group;
1718 (vii) is actuarially sound; or
1719 (c) a group specifically authorized by the commissioner under Section 31A-22-509 ,
1720 upon a finding that:
1721 (i) authorization is not contrary to the public interest;
1722 (ii) the [
1723 (iii) formation of the proposed group may result in economies of scale in acquisition,
1724 administrative, marketing, and brokerage costs;
1725 (iv) the insurance policy, insurance certificate, or other indicia of coverage that will be
1726 offered to the proposed group is substantially equivalent to insurance policies that are
1727 otherwise available to similar groups;
1728 (v) the group would not present hazards of adverse selection; [
1729 (vi) the premiums for the insurance policy and any contributions by or on behalf of the
1730 insured persons are reasonable in relation to the benefits provided[
1731 (vii) the group is formed and maintained in good faith for a purpose other than
1732 obtaining insurance.
1733 (3) A blanket accident and health insurance policy:
1734 (a) covers a defined class of persons;
1735 (b) may not be offered or underwritten on an individual basis;
1736 (c) shall cover only a group that is:
1737 (i) actuarially sound; and
1738 (ii) formed and maintained in good faith for a purpose other than obtaining insurance;
1740 (d) may [
1742 as policyholder, covering persons who may become passengers as defined by reference to
1745 or guests, as defined by reference to specified hazards incident to any activities of the
1749 jurisdictional unit, as policyholder, covering students, teachers, or employees;
1751 branch of one of those organizations, as policyholder, covering [
1752 participants as defined by reference to specified hazards incident to the activities sponsored or
1753 supervised by the policyholder;
1755 policyholder, covering members, campers, employees, officials, or supervisors;
1757 organization, as policyholder, covering [
1758 reference to specified hazards incident to activities sponsored, supervised, or participated in by
1759 the policyholder;
1762 bylaws and [
1763 obtaining insurance, as policyholder, covering [
1764 defined by reference to specified hazards incident to the activities or operations sponsored or
1765 supervised by the policyholder; and
1769 properly eligible for blanket accident and health insurance.
1770 (4) The judgment of the commissioner may be exercised on the basis of:
1771 (a) individual risks;
1772 (b) a class of risks; or
1773 (c) both Subsections (4)(a) and (b).
1774 Section 14. Section 31A-22-716 is amended to read:
1775 31A-22-716. Required provision for notice of termination.
1776 (1) Every policy for group or blanket accident and health coverage issued or renewed
1777 after July 1, 1990, shall include a provision that obligates the policyholder to give 30 days prior
1778 written notice of termination to each employee or group member and to notify each employee
1779 or group member of his rights to continue coverage upon termination.
1780 (2) An insurer's monthly notice to the policyholder of premium payments due shall
1781 include a statement of the policyholder's obligations as set forth in Subsection (1). Insurers
1782 shall provide a sample notice to the policyholder at least once a year.
1783 (3) For the purpose of compliance with federal law and the Health Insurance Portability
1784 and Accountability Act[
1785 insurers, and student health plans must provide a certificate of creditable coverage to each
1786 covered person upon the person's termination from the plan as soon as reasonably possible.
1787 Section 15. Section 31A-22-721 is amended to read:
1788 31A-22-721. A health benefit plan for a plan sponsor -- Discontinuance and
1790 (1) Except as otherwise provided in this section, a health benefit plan for a plan
1791 sponsor is renewable and continues in force:
1792 (a) with respect to all eligible employees and dependents; and
1793 (b) at the option of the plan sponsor.
1794 (2) A health benefit plan for a plan sponsor may be discontinued or nonrenewed:
1795 (a) for a network plan, if:
1796 (i) there is no longer any enrollee under the group health plan who lives, resides, or
1797 works in:
1798 (A) the service area of the insurer; or
1799 (B) the area for which the insurer is authorized to do business; and
1800 (ii) in the case of the small employer market, the insurer applies the same criteria the
1801 insurer would apply in denying enrollment in the plan under Subsection 31A-30-108 (7); or
1802 (b) for coverage made available in the small or large employer market only through an
1803 association, if:
1804 (i) the employer's membership in the association ceases; and
1805 (ii) the coverage is terminated uniformly without regard to any health status-related
1806 factor relating to any covered individual.
1807 (3) A health benefit plan for a plan sponsor may be discontinued if:
1808 (a) a condition described in Subsection (2) exists;
1809 (b) the plan sponsor fails to pay premiums or contributions in accordance with the
1810 terms of the contract;
1811 (c) the plan sponsor:
1812 (i) performs an act or practice that constitutes fraud; or
1813 (ii) makes an intentional misrepresentation of material fact under the terms of the
1815 (d) the insurer:
1816 (i) elects to discontinue offering a particular health benefit product delivered or issued
1817 for delivery in this state;
1818 (ii) (A) provides notice of the discontinuation in writing:
1819 (I) to each plan sponsor, employee, and dependent of a plan sponsor or employee; and
1820 (II) at least 90 days before the date the coverage will be discontinued;
1821 (B) provides notice of the discontinuation in writing:
1822 (I) to the commissioner; and
1823 (II) at least three working days prior to the date the notice is sent to the affected plan
1824 sponsors, employees, and dependents of plan sponsors or employees;
1825 (C) offers to each plan sponsor, on a guaranteed issue basis, the option to purchase any
1826 other health benefit products currently being offered:
1827 (I) by the insurer in the market; or
1828 (II) in the case of a large employer, any other health benefit plan currently being
1829 offered in that market; and
1830 (D) in exercising the option to discontinue that product and in offering the option of
1831 coverage in this section, the insurer acts uniformly without regard to:
1832 (I) the claims experience of a plan sponsor;
1833 (II) any health status-related factor relating to any covered participant or beneficiary; or
1834 (III) any health status-related factor relating to a new participant or beneficiary who
1835 may become eligible for coverage; or
1836 (e) the insurer:
1837 (i) elects to discontinue all of the insurer's health benefit plans:
1838 (A) in the small employer market; or
1839 (B) the large employer market; or
1840 (C) both the small and large employer markets; and
1841 (ii) (A) provides notice of the discontinuance in writing:
1842 (I) to each plan sponsor, employee, or dependent of a plan sponsor or an employee; and
1843 (II) at least 180 days before the date the coverage will be discontinued;
1844 (B) provides notice of the discontinuation in writing:
1845 (I) to the commissioner in each state in which an affected insured individual is known
1846 to reside; and
1847 (II) at least 30 business days prior to the date the notice is sent to the affected plan
1848 sponsors, employees, and dependents of a plan sponsor or employee;
1849 (C) discontinues and nonrenews all plans issued or delivered for issuance in the
1850 market; and
1851 (D) provides a plan of orderly withdrawal as required by Section 31A-4-115 .
1852 (4) A large employer health benefit plan may be discontinued or nonrenewed:
1853 (a) if a condition described in Subsection (2) exists; or
1854 (b) for noncompliance with the insurer's:
1855 (i) minimum participation requirements; or
1856 (ii) employer contribution requirements.
1857 (5) A small employer health benefit plan may be discontinued or nonrenewed:
1858 (a) if a condition described in Subsection (2) exists; or
1859 (b) for noncompliance with the insurer's employer contribution requirements.
1860 (6) A small employer health benefit plan may be nonrenewed:
1861 (a) if a condition described in Subsection (2) exists; or
1862 (b) for noncompliance with the insurer's minimum participation requirements.
1863 (7) (a) Except as provided in Subsection (7)(d), an eligible employee may be
1864 discontinued if after issuance of coverage the eligible employee:
1865 (i) engages in an act or practice that constitutes fraud in connection with the coverage;
1867 (ii) makes an intentional misrepresentation of material fact in connection with the
1869 (b) An eligible employee that is discontinued under Subsection (7)(a) may reenroll:
1870 (i) 12 months after the date of discontinuance; and
1871 (ii) if the plan sponsor's coverage is in effect at the time the eligible employee applies
1872 to reenroll.
1873 (c) At the time the eligible employee's coverage is discontinued under Subsection
1874 (7)(a), the insurer shall notify the eligible employee of the right to reenroll when coverage is
1876 (d) An eligible employee may not be discontinued under this Subsection (7) because of
1877 a fraud or misrepresentation that relates to health status.
1878 (8) (a) Except as provided in Subsection (8)(b), an insurer that elects to discontinue
1879 offering a health benefit plan under Subsection (3)(e) shall be prohibited from writing new
1880 business in such market in this state for a period of five years beginning on the date of
1881 discontinuation of the last coverage that is discontinued.
1882 (b) The commissioner may waive the prohibition under Subsection (8)(a) when the
1883 commissioner finds that waiver is in the public interest:
1884 (i) to promote competition; or
1885 (ii) to resolve inequity in the marketplace.
1886 (9) If an insurer is doing business in one established geographic service area of the
1887 state, this section applies only to the insurer's operations in that geographic service area.
1888 (10) An insurer may modify a health benefit plan for a plan sponsor only:
1889 (a) at the time of coverage renewal; and
1890 (b) if the modification is effective uniformly among all plans with a particular product
1891 or service.
1892 (11) For purposes of this section, a reference to "plan sponsor" includes a reference to
1893 the employer:
1894 (a) with respect to coverage provided to an employer member of the association; and
1895 (b) if the health benefit plan is made available by an insurer in the employer market
1896 only through:
1897 (i) an association;
1898 (ii) a trust; or
1899 (iii) a discretionary group.
1900 (12) (a) A small employer that, after purchasing a health benefit plan in the small group
1901 market, employs on average more than 50 eligible employees on each business day in a
1902 calendar year may continue to renew the health benefit plan purchased in the small group
1904 (b) A large employer that, after purchasing a health benefit plan in the large group
1905 market, employs on average less than 51 eligible employees on each business day in a calendar
1906 year may continue to renew the health benefit plan purchased in the large group market.
1907 (13) An insurer offering employer sponsored health benefit plans shall comply with the
1908 Health Insurance Portability and Accountability Act, [
1910 Section 16. Section 31A-22-723 is amended to read:
1911 31A-22-723. Conversion from group coverage.
1912 (1) Notwithstanding Subsection 31A-1-103 (3)(f), and except as provided in Subsection
1913 (3), [
1914 title, or Title 49, Chapter 20, Public Employees' Benefit and Insurance Program Act, shall
1915 provide that a person whose insurance under the group policy has been terminated is entitled to
1916 choose a converted individual policy in accordance with this section and Section 31A-22-724 .
1917 (2) A person who has lost group coverage may elect conversion coverage with the
1918 insurer that provided prior group coverage if the person:
1919 (a) has been continuously covered for a period of three months by the group policy or
1920 the group's preceding policies immediately prior to termination;
1921 (b) has exhausted either:
1922 (i) Utah mini-COBRA coverage as required in Section 31A-22-722 ;
1923 (ii) federal COBRA coverage; or
1924 (iii) alternative coverage under Section 31A-22-724 ;
1925 (c) has not acquired or is not covered under any other group coverage that covers [
1926 preexisting conditions, including maternity, if the coverage exists; and
1927 (d) resides in the insurer's service area.
1928 (3) This section does not apply if the person's prior group coverage:
1929 (a) is a stand alone policy that only provides one of the following:
1930 (i) catastrophic benefits;
1931 (ii) aggregate stop loss benefits;
1932 (iii) specific stop loss benefits;
1933 (iv) benefits for specific diseases;
1934 (v) accidental injuries only;
1935 (vi) dental; or
1936 (vii) vision;
1937 (b) is an income replacement policy;
1938 (c) was terminated because the insured:
1939 (i) failed to pay any required individual contribution;
1940 (ii) performed an act or practice that constitutes fraud in connection with the coverage;
1942 (iii) made intentional misrepresentation of material fact under the terms of coverage; or
1943 (d) was terminated pursuant to Subsection 31A-8-402.3 (2)(a), 31A-22-721 (2)(a), or
1944 31A-30-107 (2)(a).
1945 (4) (a) The [
1946 individual conversion policy within 30 days of the insurer receiving notice of, the insured's
1947 termination of COBRA or Utah mini-COBRA coverage to:
1948 (i) the terminated insured;
1949 (ii) the ex-spouse; or
1950 (iii) in the case of the death of the insured:
1951 (A) the surviving spouse; and
1952 (B) the guardian of any dependents, if different from a surviving spouse.
1953 (b) The notification required by Subsection (4)(a) shall:
1954 (i) be sent by first class mail;
1955 (ii) contain the name, address, and telephone number of the insurer that will provide
1956 the conversion coverage; and
1957 (iii) be sent to the insured's last-known address as shown on the records of the
1958 employer of:
1959 (A) the insured;
1960 (B) the ex-spouse; and
1961 (C) if the policy terminates by reason of the death of the insured to:
1962 (I) the surviving spouse; and
1963 (II) the guardian of any dependents, if different from a surviving spouse.
1964 (5) (a) An insurer is not required to issue a converted policy [
1965 benefits in excess of those provided under the group policy from which conversion is made.
1966 (b) Except as provided in Subsection (5)(c), if the conversion is made from a health
1967 benefit plan, the employee or member shall be offered[
1970 (c) If the benefit levels required under Subsection (5)(b) exceed the benefit levels
1971 provided under the group policy, the conversion policy may offer benefits [
1972 substantially similar to those provided under the group policy.
1973 (6) Written application for [
1974 paid to the insurer no later than [
1976 (7) [
1977 (8) (a) The initial premium for the converted policy for the first 12 months and
1978 subsequent renewal premiums shall be determined in accordance with premium rates
1979 applicable to age, class of risk of the person, and the type and amount of insurance provided.
1980 (b) The initial premium for the first 12 months may not be raised based on pregnancy
1981 of a covered insured.
1982 (c) The premium for converted policies shall be payable monthly or quarterly as
1983 required by the insurer for the policy form and plan selected, unless another mode or premium
1984 payment is mutually agreed upon.
1985 (9) [
1986 group policy terminates.
1987 (10) (a) A newly issued converted policy covers the employee or the member and must
1988 also cover [
1990 (b) The only dependents that may be added after the policy has been issued are children
1991 and dependents as required by Section 31A-22-610 and Subsections 31A-22-610.5 (6) and (7).
1992 (c) At the option of the insurer, a separate converted policy may be issued to cover
1994 (11) (a) To the extent [
1995 conversion policy shall provide maternity benefits equal to the lesser of the maternity benefits
1996 of the group policy or the conversion policy until termination of a pregnancy that exists on the
1997 date of conversion if one of the following is pregnant on the date of the conversion:
1998 (i) the insured;
1999 (ii) a spouse of the insured; or
2000 (iii) a dependent of the insured.
2001 (b) [
2002 that occurs after the date of conversion.
2003 (12) Except as provided in this Subsection (12), a converted policy is renewable with
2004 respect to [
2005 insured. An insured may be terminated from a converted policy for the following reasons:
2006 (a) a dependent is no longer eligible under the converted policy;
2007 (b) for a network plan, if the individual no longer lives, resides, or works in:
2008 (i) the insured's service area; or
2009 (ii) the area for which the covered carrier is authorized to do business;
2010 (c) the individual fails to pay premiums or contributions in accordance with the terms
2011 of the converted policy, including any timeliness requirements;
2012 (d) the individual performs an act or practice that constitutes fraud in connection with
2013 the coverage;
2014 (e) the individual makes an intentional misrepresentation of material fact under the
2015 terms of the coverage; or
2016 (f) coverage is terminated uniformly without regard to any health status-related factor
2017 relating to any covered individual.
2018 (13) Conditions pertaining to health may not be used as a basis for classification under
2019 this section.
2020 (14) An insurer is only required to offer a conversion policy that complies with
2021 Subsection 31A-22-724 (1)(b) and, notwithstanding Sections 31A-8-402.5 and 31A-30-107.1 ,
2022 may discontinue any other conversion policy if:
2023 (a) the discontinued conversion policy is discontinued uniformly without regard to
2025 (b) [
2026 notice of the discontinuation of the existing conversion policy;
2027 (c) the [
2028 complies with Subsection 31A-22-724 (1)(b); and
2029 (d) the [
2030 (15) This section does not apply to a blanket accident and health insurance policy
2031 issued under Section 31A-22-701 .
2032 Section 17. Section 31A-23a-102 is amended to read:
2033 31A-23a-102. Definitions.
2034 As used in this chapter:
2035 (1) "Bail bond producer" means a person who:
2036 (a) is appointed by:
2037 (i) a surety insurer that issues bail bonds; or
2038 (ii) a bail bond surety company licensed under Chapter 35, Bail Bond Act;
2039 (b) is designated to execute or countersign undertakings of bail in connection with a
2040 judicial proceeding; and
2041 (c) receives or is promised money or other things of value for engaging in an act
2042 described in Subsection (1)(b).
2043 (2) "Escrow" means a license subline of authority in conjunction with the title
2044 insurance line of authority that allows a person to conduct escrow as defined in Section
2045 31A-1-301 .
2046 (3) "Home state" means a state or territory of the United States or the District of
2047 Columbia in which an insurance producer:
2048 (a) maintains the insurance producer's principal:
2049 (i) place of residence; or
2050 (ii) place of business; and
2051 (b) is licensed to act as an insurance producer.
2052 (4) "Insurer" is as defined in Section 31A-1-301 , except that the following persons or
2053 similar persons are not insurers for purposes of Part 7, Producer Controlled Insurers:
2054 (a) a risk retention group as defined in:
2055 (i) the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499;
2056 (ii) the Risk Retention Act, 15 U.S.C. Sec. 3901 et seq.; and
2057 (iii) Chapter 15, Part 2, Risk Retention Groups Act;
2058 (b) a residual market pool;
2059 (c) a joint underwriting authority or association; and
2060 (d) a captive insurer.
2061 (5) "License" is defined in Section 31A-1-301 .
2062 (6) (a) "Managing general agent" means a person that:
2063 (i) manages all or part of the insurance business of an insurer, including the
2064 management of a separate division, department, or underwriting office;
2065 (ii) acts as an agent for the insurer whether it is known as a managing general agent,
2066 manager, or other similar term;
2067 (iii) produces and underwrites an amount of gross direct written premium equal to, or
2068 more than 5% of, the policyholder surplus as reported in the last annual statement of the insurer
2069 in any one quarter or year:
2070 (A) with or without the authority;
2071 (B) separately or together with an affiliate; and
2072 (C) directly or indirectly; and
2073 (iv) (A) adjusts or pays claims in excess of an amount determined by the
2074 commissioner; or
2075 (B) negotiates reinsurance on behalf of the insurer.
2076 (b) Notwithstanding Subsection (6)(a), the following persons may not be considered as
2077 managing general agent for the purposes of this chapter:
2078 (i) an employee of the insurer;
2079 (ii) a United States manager of the United States branch of an alien insurer;
2080 (iii) an underwriting manager that, pursuant to contract:
2081 (A) manages all the insurance operations of the insurer;
2082 (B) is under common control with the insurer;
2083 (C) is subject to Chapter 16, Insurance Holding Companies; and
2084 (D) is not compensated based on the volume of premiums written; and
2085 (iv) the attorney-in-fact authorized by and acting for the subscribers of a reciprocal
2086 insurer or inter-insurance exchange under powers of attorney.
2087 (7) "Negotiate" means the act of conferring directly with or offering advice directly to a
2088 purchaser or prospective purchaser of a particular contract of insurance concerning a
2089 substantive benefit, term, or condition of the contract if the person engaged in that act:
2090 (a) sells insurance; or
2091 (b) obtains insurance from insurers for purchasers.
2092 (8) "Reinsurance intermediary" means:
2093 (a) a reinsurance intermediary-broker; or
2094 (b) a reinsurance intermediary-manager.
2095 (9) "Reinsurance intermediary-broker" means a person other than an officer or
2096 employee of the ceding insurer, firm, association, or corporation who solicits, negotiates, or
2097 places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority
2098 or power to bind reinsurance on behalf of the insurer.
2099 (10) (a) "Reinsurance intermediary-manager" means a person who:
2100 (i) has authority to bind or who manages all or part of the assumed reinsurance
2101 business of a reinsurer, including the management of a separate division, department, or
2102 underwriting office; and
2103 (ii) acts as an agent for the reinsurer whether the person is known as a reinsurance
2104 intermediary-manager, manager, or other similar term.
2105 (b) Notwithstanding Subsection (10)(a), the following persons may not be considered
2106 reinsurance intermediary-managers for the purpose of this chapter with respect to the reinsurer:
2107 (i) an employee of the reinsurer;
2108 (ii) a United States manager of the United States branch of an alien reinsurer;
2109 (iii) an underwriting manager that, pursuant to contract:
2110 (A) manages all the reinsurance operations of the reinsurer;
2111 (B) is under common control with the reinsurer;
2112 (C) is subject to Chapter 16, Insurance Holding Companies; and
2113 (D) is not compensated based on the volume of premiums written; and
2114 (iv) the manager of a group, association, pool, or organization of insurers that:
2115 (A) engage in joint underwriting or joint reinsurance; and
2116 (B) are subject to examination by the insurance commissioner of the state in which the
2117 manager's principal business office is located.
2118 (11) "Search" means a license subline of authority in conjunction with the title
2119 insurance line of authority that allows a person to issue title insurance commitments or policies
2120 on behalf of a title insurer.
2121 (12) "Sell" means to exchange a contract of insurance:
2122 (a) by any means;
2123 (b) for money or its equivalent; and
2124 (c) on behalf of an insurance company.
2125 (13) "Solicit" means:
2126 (a) attempting to sell insurance;
2127 (b) asking or urging a person to apply for:
2128 (i) a particular kind of insurance; and
2129 (ii) insurance from a particular insurance company;
2130 (c) advertising insurance, including advertising for the purpose of obtaining leads for
2131 the sale of insurance; or
2132 (d) holding oneself out as being in the insurance business.
2133 (14) "Terminate" means:
2134 (a) the cancellation of the relationship between:
2135 (i) an individual licensee or agency licensee and a particular insurer; or
2136 (ii) an individual licensee and a particular agency licensee; or
2137 (b) the termination of:
2138 (i) an individual licensee's or agency licensee's authority to transact insurance on behalf
2139 of a particular insurance company; or
2140 (ii) an individual licensee's authority to transact insurance on behalf of a particular
2141 agency licensee.
2142 (15) "Title marketing representative" means a person who:
2143 (a) represents a title insurer in soliciting, requesting, or negotiating the placing of:
2144 (i) title insurance; or
2145 (ii) escrow services; and
2146 (b) does not have a search or escrow license as provided in Section 31A-23a-106 .
2147 (16) "Uniform application" means the version of the National Association of Insurance
2149 licensing at the time the application is filed.
2150 (17) "Uniform business entity application" means the version of the National
2151 Association of Insurance [
2152 for resident and nonresident business entities at the time the application is filed.
2153 Section 18. Section 31A-23a-106 is amended to read:
2154 31A-23a-106. License types.
2155 (1) (a) A resident or nonresident license issued under this chapter shall be issued under
2156 the license types described under Subsection (2).
2157 (b) A license type and a line of authority pertaining to a license type describe the type
2158 of licensee and the lines of business that a licensee may sell, solicit, or negotiate. A license type
2159 is intended to describe the matters to be considered under any education, examination, and
2160 training required of a license applicant under Sections 31A-23a-108 , 31A-23a-202 , and
2161 31A-23a-203 .
2162 (2) (a) A producer license type includes the following lines of authority:
2163 (i) life insurance, including a nonvariable contract;
2164 (ii) variable contracts, including variable life and annuity, if the producer has the life
2165 insurance line of authority;
2166 (iii) accident and health insurance, including a contract issued to a policyholder under
2167 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2168 Organizations and Limited Health Plans;
2169 (iv) property insurance;
2170 (v) casualty insurance, including a surety or other bond;
2171 (vi) title insurance under one or more of the following categories:
2172 (A) search, including authority to act as a title marketing representative;
2173 (B) escrow, including authority to act as a title marketing representative; and
2174 (C) title marketing representative only;
2175 (vii) personal lines insurance; and
2176 (viii) surplus lines, if the producer has the property or casualty or both lines of
2178 (b) A limited line producer license type includes the following limited lines of
2180 (i) limited line credit insurance;
2181 (ii) travel insurance;
2182 (iii) motor club insurance;
2183 (iv) car rental related insurance;
2184 (v) legal expense insurance;
2185 (vi) crop insurance;
2186 (vii) self-service storage insurance; [
2187 (viii) bail bond producer[
2188 (ix) guaranteed asset protection waiver.
2189 (c) A customer service representative license type includes the following lines of
2190 authority, if held by the customer service representative's employer producer:
2191 (i) life insurance, including a nonvariable contract;
2192 (ii) accident and health insurance, including a contract issued to a policyholder under
2193 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2194 Organizations and Limited Health Plans;
2195 (iii) property insurance;
2196 (iv) casualty insurance, including a surety or other bond;
2197 (v) personal lines insurance; and
2198 (vi) surplus lines, if the employer producer has the property or casualty or both lines of
2200 (d) A consultant license type includes the following lines of authority:
2201 (i) life insurance, including a nonvariable contract;
2202 (ii) variable contracts, including variable life and annuity, if the consultant has the life
2203 insurance line of authority;
2204 (iii) accident and health insurance, including a contract issued to a policyholder under
2205 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2206 Organizations and Limited Health Plans;
2207 (iv) property insurance;
2208 (v) casualty insurance, including a surety or other bond; and
2209 (vi) personal lines insurance.
2210 (e) A managing general agent license type includes the following lines of authority:
2211 (i) life insurance, including a nonvariable contract;
2212 (ii) variable contracts, including variable life and annuity, if the managing general
2213 agent has the life insurance line of authority;
2214 (iii) accident and health insurance, including a contract issued to a policyholder under
2215 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2216 Organizations and Limited Health Plans;
2217 (iv) property insurance;
2218 (v) casualty insurance, including a surety or other bond; and
2219 (vi) personal lines insurance.
2220 (f) A reinsurance intermediary license type includes the following lines of authority:
2221 (i) life insurance, including a nonvariable contract;
2222 (ii) variable contracts, including variable life and annuity, if the reinsurance
2223 intermediary has the life insurance line of authority;
2224 (iii) accident and health insurance, including a contract issued to a policyholder under
2225 Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
2226 Organizations and Limited Health Plans;
2227 (iv) property insurance;
2228 (v) casualty insurance, including a surety or other bond; and
2229 (vi) personal lines insurance.
2230 (g) A [
2231 (2)(a), (d), (e), [
2232 under Subsections (2)(b) and (c), except that the person may not act under Subsection
2233 (2)(b)(viii) or (ix).
2234 (3) (a) The commissioner may by rule recognize other producer, limited line producer,
2235 customer service representative, consultant, managing general agent, or reinsurance
2236 intermediary lines of authority as to kinds of insurance not listed under Subsections (2)(a)
2237 through (f).
2238 (b) Notwithstanding Subsection (3)(a), for purposes of title insurance the Title and
2239 Escrow Commission may by rule, with the concurrence of the commissioner and subject to
2240 Section 31A-2-404 , recognize other categories for a title insurance producer line of authority
2241 not listed under Subsection (2)(a)(vi).
2242 (4) The variable contracts, including variable life and annuity line of authority requires:
2243 (a) licensure as a registered agent or broker by the [
2245 (b) current registration with a securities broker-dealer.
2246 (5) A surplus lines producer is a producer who has a surplus lines line of authority.
2247 Section 19. Section 31A-23a-111 is amended to read:
2248 31A-23a-111. Revocation, suspension, surrender, lapsing, limiting, or otherwise
2249 terminating a license -- Rulemaking for renewal or reinstatement.
2250 (1) A license type issued under this chapter remains in force until:
2251 (a) revoked or suspended under Subsection (5);
2252 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
2253 administrative action;
2254 (c) the licensee dies or is adjudicated incompetent as defined under:
2255 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2256 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2258 (d) lapsed under Section 31A-23a-113 ; or
2259 (e) voluntarily surrendered.
2260 (2) The following may be reinstated within one year after the day on which the license
2261 is no longer in force:
2262 (a) a lapsed license; or
2263 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
2264 not be reinstated after the license period in which the license is voluntarily surrendered.
2265 (3) Unless otherwise stated in [
2266 license, submission and acceptance of a voluntary surrender of a license does not prevent the
2267 department from pursuing additional disciplinary or other action authorized under:
2268 (a) this title; or
2269 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
2270 Administrative Rulemaking Act.
2271 (4) A line of authority issued under this chapter remains in force until:
2272 (a) the qualifications pertaining to a line of authority are no longer met by the licensee;
2274 (b) the supporting license type:
2275 (i) is revoked or suspended under Subsection (5);
2276 (ii) is surrendered to the commissioner and accepted by the commissioner in lieu of
2277 administrative action;
2278 (iii) the licensee dies or is adjudicated incompetent as defined under:
2279 (A) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2280 (B) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2282 (iv) lapsed under Section 31A-23a-113 ; or
2283 (v) voluntarily surrendered.
2284 (5) (a) If the commissioner makes a finding under Subsection (5)(b), as part of an
2285 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
2286 commissioner may:
2287 (i) revoke:
2288 (A) a license; or
2289 (B) a line of authority;
2290 (ii) suspend for a specified period of 12 months or less:
2291 (A) a license; or
2292 (B) a line of authority;
2293 (iii) limit in whole or in part:
2294 (A) a license; or
2295 (B) a line of authority; or
2296 (iv) deny a license application.
2297 (b) The commissioner may take an action described in Subsection (5)(a) if the
2298 commissioner finds that the licensee:
2299 (i) is unqualified for a license or line of authority under Section 31A-23a-104 ,
2300 31A-23a-105 , or 31A-23a-107 ;
2301 (ii) violates:
2302 (A) an insurance statute;
2303 (B) a rule that is valid under Subsection 31A-2-201 (3); or
2304 (C) an order that is valid under Subsection 31A-2-201 (4);
2305 (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
2306 delinquency proceedings in any state;
2307 (iv) fails to pay a final judgment rendered against the person in this state within 60
2308 days after the day on which the judgment became final;
2309 (v) fails to meet the same good faith obligations in claims settlement that is required of
2310 admitted insurers;
2311 (vi) is affiliated with and under the same general management or interlocking
2312 directorate or ownership as another insurance producer that transacts business in this state
2313 without a license;
2314 (vii) refuses:
2315 (A) to be examined; or
2316 (B) to produce its accounts, records, and files for examination;
2317 (viii) has an officer who refuses to:
2318 (A) give information with respect to the insurance producer's affairs; or
2319 (B) perform any other legal obligation as to an examination;
2320 (ix) provides information in the license application that is:
2321 (A) incorrect;
2322 (B) misleading;
2323 (C) incomplete; or
2324 (D) materially untrue;
2325 (x) violates an insurance law, valid rule, or valid order of another state's insurance
2327 (xi) obtains or attempts to obtain a license through misrepresentation or fraud;
2328 (xii) improperly withholds, misappropriates, or converts money or properties received
2329 in the course of doing insurance business;
2330 (xiii) intentionally misrepresents the terms of an actual or proposed:
2331 (A) insurance contract;
2332 (B) application for insurance; or
2333 (C) life settlement;
2334 (xiv) is convicted of a felony;
2335 (xv) admits or is found to have committed an insurance unfair trade practice or fraud;
2336 (xvi) in the conduct of business in this state or elsewhere:
2337 (A) uses fraudulent, coercive, or dishonest practices; or
2338 (B) demonstrates incompetence, untrustworthiness, or financial irresponsibility;
2339 (xvii) has an insurance license, or its equivalent, denied, suspended, or revoked in
2340 another state, province, district, or territory;
2341 (xviii) forges another's name to:
2342 (A) an application for insurance; or
2343 (B) a document related to an insurance transaction;
2344 (xix) improperly uses notes or another reference material to complete an examination
2345 for an insurance license;
2346 (xx) knowingly accepts insurance business from an individual who is not licensed;
2347 (xxi) fails to comply with an administrative or court order imposing a child support
2349 (xxii) fails to:
2350 (A) pay state income tax; or
2351 (B) comply with an administrative or court order directing payment of state income
2353 (xxiii) violates or permits others to violate the federal Violent Crime Control and Law
2354 Enforcement Act of 1994, 18 U.S.C. [
2355 (xxiv) engages in a method or practice in the conduct of business that endangers the
2356 legitimate interests of customers and the public.
2357 (c) For purposes of this section, if a license is held by an agency, both the agency itself
2358 and any individual designated under the license are considered to be the holders of the license.
2359 (d) If an individual designated under the agency license commits an act or fails to
2360 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
2361 the commissioner may suspend, revoke, or limit the license of:
2362 (i) the individual;
2363 (ii) the agency, if the agency:
2364 (A) is reckless or negligent in its supervision of the individual; or
2365 (B) knowingly participates in the act or failure to act that is the ground for suspending,
2366 revoking, or limiting the license; or
2367 (iii) (A) the individual; and
2368 (B) the agency if the agency meets the requirements of Subsection (5)(d)(ii).
2369 (6) A licensee under this chapter is subject to the penalties for acting as a licensee
2370 without a license if:
2371 (a) the licensee's license is:
2372 (i) revoked;
2373 (ii) suspended;
2374 (iii) limited;
2375 (iv) surrendered in lieu of administrative action;
2376 (v) lapsed; or
2377 (vi) voluntarily surrendered; and
2378 (b) the licensee:
2379 (i) continues to act as a licensee; or
2380 (ii) violates the terms of the license limitation.
2381 (7) A licensee under this chapter shall immediately report to the commissioner:
2382 (a) a revocation, suspension, or limitation of the person's license in another state, the
2383 District of Columbia, or a territory of the United States;
2384 (b) the imposition of a disciplinary sanction imposed on that person by another state,
2385 the District of Columbia, or a territory of the United States; or
2386 (c) a judgment or injunction entered against that person on the basis of conduct
2388 (i) fraud;
2389 (ii) deceit;
2390 (iii) misrepresentation; or
2391 (iv) a violation of an insurance law or rule.
2392 (8) (a) An order revoking a license under Subsection (5) or an agreement to surrender a
2393 license in lieu of administrative action may specify a time, not to exceed five years, within
2394 which the former licensee may not apply for a new license.
2395 (b) If no time is specified in an order or agreement described in Subsection (8)(a), the
2396 former licensee may not apply for a new license for five years from the day on which the order
2397 or agreement is made without the express approval by the commissioner.
2398 (9) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
2399 a license issued under this part if so ordered by a court.
2400 (10) The commissioner shall by rule prescribe the license renewal and reinstatement
2401 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
2402 Section 20. Section 31A-23a-202 is amended to read:
2403 31A-23a-202. Continuing education requirements.
2404 (1) Pursuant to this section, the commissioner shall by rule prescribe the continuing
2405 education requirements for a producer and a consultant.
2406 (2) (a) The commissioner may not state a continuing education requirement in terms of
2407 formal education.
2408 (b) The commissioner may state a continuing education requirement in terms of
2410 (c) Insurance-related formal education may be a substitute, in whole or in part, for
2412 (3) (a) The commissioner shall impose continuing education requirements in
2413 accordance with a two-year licensing period in which the licensee meets the requirements of
2414 this Subsection (3).
2415 (b) (i) Except as provided in this section, the continuing education requirements shall
2417 (A) that a licensee complete 24 credit hours of continuing education for every two-year
2418 licensing period;
2419 (B) that 3 of the 24 credit hours described in Subsection (3)(b)(i)(A) be ethics courses;
2421 (C) that the licensee complete at least half of the required hours through classroom
2422 hours of insurance-related instruction.
2423 (ii) [
2424 education in accordance with Subsection (3)(b)(i)[
2425 (A) classroom attendance;
2430 (iii) (A) Notwithstanding Subsections (3)(b)(i)(A) and (B), a title insurance producer is
2431 required to complete 12 credit hours of continuing education for every two-year licensing
2432 period, with 3 of the credit hours being ethics courses unless the title insurance producer is
2433 licensed in this state as a title insurance producer for 20 or more consecutive years.
2434 (B) If a title insurance producer is licensed in this state as a title insurance producer for
2435 20 or more consecutive years, the title insurance producer is required to complete 6 credit hours
2436 of continuing education for every two-year licensing period, with 3 of the credit hours being
2437 ethics courses.
2438 (C) Notwithstanding Subsection (3)(b)(iii)(A) or (B), a title insurance producer is
2439 considered to have met the continuing education requirements imposed under Subsection
2440 (3)(b)(iii)(A) or (B) if the title insurance producer:
2441 (I) is an active member in good standing with the Utah State Bar;
2442 (II) is in compliance with the continuing education requirements of the Utah State Bar;
2444 (III) if requested by the department, provides the department evidence that the title
2445 insurance producer complied with the continuing education requirements of the Utah State Bar.
2446 (c) A licensee may obtain continuing education hours at any time during the two-year
2447 licensing period.
2448 (d) (i) A licensee is exempt from continuing education requirements under this section
2450 (A) the licensee was first licensed before April 1, 1978;
2451 (B) the license does not have a continuous lapse for a period of more than one year,
2452 except for a license for which the licensee has had an exemption approved before May 11,
2456 (ii) If the department approves the exemption under Subsection (3)(d)(i), the licensee is
2457 not required to apply again for the exemption.
2458 (e) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2459 commissioner shall, by rule:
2460 (i) publish a list of insurance professional designations whose continuing education
2461 requirements can be used to meet the requirements for continuing education under Subsection
2463 (ii) authorize a continuing education provider or a state or national professional
2464 producer or consultant association to:
2465 (A) offer a qualified program for a license type or line of authority on a geographically
2466 accessible basis; and
2467 (B) collect a reasonable fee for funding and administration of a continuing education
2468 program, subject to the review and approval of the commissioner; and
2469 (iii) provide that membership by a producer or consultant in a state or national
2470 professional producer or consultant association is considered a substitute for the equivalent of
2471 two hours for each year during which the producer or consultant is a member of the
2472 professional association, except that the commissioner may not give more than two hours of
2473 continuing education credit in a year regardless of the number of professional associations of
2474 which the producer or consultant is a member.
2475 (f) A fee permitted under Subsection (3)(e)(ii)(B) that is charged for attendance at a
2476 professional producer or consultant association program may be less for an association
2477 member, on the basis of the member's affiliation expense, but shall preserve the right of a
2478 nonmember to attend without affiliation.
2479 (4) The commissioner shall approve a continuing education provider or continuing
2480 education course that satisfies the requirements of this section.
2481 (5) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2482 commissioner shall by rule set the processes and procedures for continuing education provider
2483 registration and course approval.
2484 (6) The requirements of this section apply only to a producer or consultant who is an
2486 (7) A nonresident producer or consultant is considered to have satisfied this state's
2487 continuing education requirements if the nonresident producer or consultant satisfies the
2488 nonresident producer's or consultant's home state's continuing education requirements for a
2489 licensed insurance producer or consultant.
2490 (8) A producer or consultant subject to this section shall keep documentation of
2491 completing the continuing education requirements of this section for two years after the end of
2492 the two-year licensing period to which the continuing education applies.
2493 Section 21. Section 31A-23a-203 is amended to read:
2494 31A-23a-203. Training period requirements.
2495 (1) A producer is eligible to add the surplus lines of authority to the person's producer's
2496 license if the producer:
2497 (a) has passed the applicable examination;
2498 (b) has been a producer with property and casualty lines of authority for at least three
2499 years during the four years immediately preceding the date of application; and
2500 (c) has paid the applicable fee under Section 31A-3-103 .
2501 (2) A person is eligible to become a consultant only if the person has acted in a
2502 capacity that would provide the person with preparation to act as an insurance consultant for a
2503 period aggregating not less than three years during the four years immediately preceding the
2504 date of application.
2505 (3) (a) A resident producer with an accident and health line of authority may only sell
2506 long-term care insurance if the producer:
2507 (i) initially completes a minimum of three hours of long-term care training before
2508 selling long-term care coverage; and
2509 (ii) after completing the training required by Subsection (3)(a)(i), completes a
2510 minimum of three hours of long-term care training during each subsequent two-year licensing
2512 (b) A course taken to satisfy a long-term care training requirement may be used toward
2513 satisfying a producer continuing education requirement.
2514 (c) Long-term care training is not a continuing education requirement to renew a
2515 producer license.
2516 (d) An insurer that issues long-term care insurance shall demonstrate to the
2517 commissioner, upon request, that a producer who is appointed by the insurer and who sells
2518 long-term care insurance coverage is in compliance with this Subsection (3).
2520 applying for a license under this chapter.
2521 Section 22. Section 31A-23a-204 is amended to read:
2522 31A-23a-204. Special requirements for title insurance producers and agencies.
2523 A title insurance producer, including an agency, shall be licensed in accordance with
2524 this chapter, with the additional requirements listed in this section.
2525 (1) (a) A person that receives a new license under this title as a title insurance agency,
2526 shall at the time of licensure be owned or managed by [
2527 least one individual who is licensed for at least three of the five years immediately [
2528 preceding the date on which the title insurance agency applies for a license with both:
2529 (i) a search line of authority; and
2530 (ii) an escrow line of authority.
2531 (b) A title insurance agency subject to Subsection (1)(a) may comply with Subsection
2532 (1)(a) by having the title insurance agency owned or managed by:
2533 (i) one or more individuals who are licensed with the search line of authority for the
2534 time period provided in Subsection (1)(a); and
2535 (ii) one or more individuals who are licensed with the escrow line of authority for the
2536 time period provided in Subsection (1)(a).
2537 (c) A person licensed as a title insurance agency shall at all times during the term of
2538 licensure be owned or managed by at least one individual who is licensed for at least three
2539 years within the preceding five-year period with both:
2540 (i) a search line of authority; and
2541 (ii) an escrow line of authority.
2543 exempt an attorney with real estate experience from the experience requirements in Subsection
2545 (2) (a) A title insurance agency or producer appointed by an insurer shall maintain:
2546 (i) a fidelity bond;
2547 (ii) a professional liability insurance policy; or
2548 (iii) a financial protection:
2549 (A) equivalent to that described in Subsection (2)(a)(i) or (ii); and
2550 (B) that the commissioner considers adequate.
2551 (b) The bond, insurance, or financial protection required by this Subsection (2):
2552 (i) shall be supplied under a contract approved by the commissioner to provide
2553 protection against the improper performance of any service in conjunction with the issuance of
2554 a contract or policy of title insurance; and
2555 (ii) be in a face amount no less than $50,000.
2556 (c) The Title and Escrow Commission may by rule, subject to Section 31A-2-404 ,
2557 exempt title insurance producers from the requirements of this Subsection (2) upon a finding
2558 that, and only so long as, the required policy or bond is generally unavailable at reasonable
2560 (3) A title insurance agency or producer appointed by an insurer may maintain a
2561 reserve fund to the extent monies were deposited before July 1, 2008, and not withdrawn to the
2562 income of the title insurance producer.
2563 (4) An examination for licensure shall include questions regarding the search and
2564 examination of title to real property.
2565 (5) A title insurance producer may not perform the functions of escrow unless the title
2566 insurance producer has been examined on the fiduciary duties and procedures involved in those
2568 (6) The Title and Escrow Commission shall adopt rules, subject to Section 31A-2-404 ,
2569 after consulting with the department and the department's test administrator, establishing an
2570 examination for a license that will satisfy this section.
2571 (7) A license may be issued to a title insurance producer who has qualified:
2572 (a) to perform only searches and examinations of title as specified in Subsection (4);
2573 (b) to handle only escrow arrangements as specified in Subsection (5); or
2574 (c) to act as a title marketing representative.
2575 (8) (a) A person licensed to practice law in Utah is exempt from the requirements of
2576 Subsections (2) and (3) if that person issues 12 or less policies in any 12-month period.
2577 (b) In determining the number of policies issued by a person licensed to practice law in
2578 Utah for purposes of Subsection (8)(a), if the person licensed to practice law in Utah issues a
2579 policy to more than one party to the same closing, the person is considered to have issued only
2580 one policy.
2581 (9) A person licensed to practice law in Utah, whether exempt under Subsection (8) or
2582 not, shall maintain a trust account separate from a law firm trust account for all title and real
2583 estate escrow transactions.
2584 Section 23. Section 31A-23a-406 is amended to read:
2585 31A-23a-406. Title insurance producer's business.
2586 (1) A title insurance producer may do escrow involving real property transactions if all
2587 of the following exist:
2588 (a) the title insurance producer is licensed with:
2589 (i) the title line of authority; and
2590 (ii) the escrow subline of authority;
2591 (b) the title insurance producer is appointed by a title insurer authorized to do business
2592 in the state;
2593 (c) the title insurance producer issues one or more of the following [
2594 part of the transaction:
2595 (i) an owner's policy of title insurance; or
2596 (ii) a lender's policy of title insurance;
2597 (d) [
2598 any escrow:
2602 money that is not related to real estate transactions; [
2604 under the provisions of the escrow; and
2607 (e) earnings on [
2608 any person in accordance with the conditions of the escrow; [
2609 (f) the escrow does not require the title insurance producer to hold:
2610 (i) construction [
2611 (ii) [
2613 (g) the title insurance producer shall maintain a physical office in Utah staffed by a
2614 person with an escrow subline of authority who processes the escrow.
2615 (2) Notwithstanding Subsection (1), a title insurance producer may engage in the
2616 escrow business if:
2617 (a) the escrow involves:
2618 (i) a mobile home;
2619 (ii) a grazing right;
2620 (iii) a water right; or
2621 (iv) other personal property authorized by the commissioner; and
2622 (b) the title insurance producer complies with [
2623 except for [
2624 (3) [
2625 (a) [
2626 (b) may only be used to fulfill the terms of the individual escrow under which the
2628 (c) may not be used until [
2629 (4) Assets or property other than escrow [
2630 producer in accordance with an escrow shall be maintained in a manner that will:
2631 (a) reasonably preserve and protect the asset or property from loss, theft, or damages;
2633 (b) otherwise comply with [
2635 (5) (a) A check from the trust account described in Subsection (1)(d) may not be
2636 drawn, executed, or dated, or [
2637 account from which [
2638 consisting of collected [
2639 or dated, or [
2640 (b) As used in this Subsection (5), [
2641 and cleared," and may be disbursed as follows:
2642 (i) cash may be disbursed on the same day the cash is deposited;
2643 (ii) a wire transfer may be disbursed on the same day the wire transfer is deposited; and
2660 (iii) the proceeds of one or more of the following financial instruments may be
2661 disbursed on the same day the financial instruments are deposited if received from a single
2662 party to the real estate transaction and if the aggregate of the financial instruments for the real
2663 estate transaction is less than $10,000:
2664 (A) a cashier's check, certified check, or official check that is drawn on an existing
2665 account at a federally insured financial institution;
2666 (B) a check drawn on the trust account of a principal broker or associate broker
2667 licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices Act, if the title
2668 producer has reasonable and prudent grounds to believe sufficient money will be available
2669 from the trust account on which the check is drawn at the time of disbursement of proceeds
2670 from the title producer's escrow account;
2671 (C) a personal check not to exceed $500 per closing;
2672 (D) a check drawn on the escrow account of another title producer, if the title producer
2673 in the escrow transaction has reasonable and prudent grounds to believe that sufficient money
2674 will be available for withdrawal from the account upon which the check is drawn at the time of
2675 disbursement of money from the escrow account of the title producer in the escrow transaction;
2677 (E) a check issued by a farm credit service authorized under the Farm Credit Act of
2678 1971, 12 U.S.C. Sec. 2001 et seq., as amended.
2679 (c) Money received from a financial instrument described in Subsection (5)(b)(iii)(B)
2680 or (C) may be disbursed:
2681 (i) within the time limits provided under the Expedited Funds Availability Act, 12
2682 U.S.C. Sec. 4001 et seq., as amended, and related regulations of the Federal Reserve System; or
2683 (ii) upon notification from the financial institution to which the money has been
2684 deposited that final settlement has occurred on the deposited financial instrument.
2685 (6) [
2687 (7) [
2688 (a) Section 31A-23a-409 ;
2689 (b) Title 46, Chapter 1, Notaries Public Reform Act; and
2690 (c) any rules adopted by the Title and Escrow Commission, subject to Section
2691 31A-2-404 , that govern escrows.
2692 (8) If a title insurance producer conducts a search for real estate located in the state, the
2693 title insurance producer shall conduct a minimum mandatory search, as defined by rule made
2694 by the Title and Escrow Commission, subject to Section 31A-2-404 .
2695 Section 24. Section 31A-23a-408 is amended to read:
2696 31A-23a-408. Representations of agency.
2698 insurer unless a written agency contract is in effect giving the person authority from the insurer
2699 and the insurer [
2700 Section 25. Section 31A-23a-412 is amended to read:
2701 31A-23a-412. Place of business and residence address -- Records.
2702 (1) (a) [
2704 (i) the address and telephone numbers of [
2706 (ii) a valid business email address at which the commissioner may contact the licensee.
2707 (b) If [
2708 the individual shall [
2709 residence address and telephone number.
2710 (c) A licensee shall notify the commissioner within 30 days of [
2711 the following required to be registered with the commissioner under this section:
2712 (i) an address [
2713 (ii) a telephone number[
2714 (iii) a business email address.
2715 (2) (a) Except as provided under Subsection (3), [
2716 shall keep at the principal place of business address registered under Subsection (1), separate
2717 and distinct books and records of [
2718 (b) The books and records described in Subsection (2)(a) shall:
2719 (i) be in an organized form;
2720 (ii) be available to the commissioner for inspection upon reasonable notice; and
2721 (iii) include all of the following:
2722 (A) if the licensee is a producer, limited line producer, consultant, managing general
2723 agent, or reinsurance intermediary:
2724 (I) a record of each insurance contract procured by or issued through the licensee, with
2725 the names of insurers and insureds, the amount of premium and commissions or other
2726 compensation, and the subject of the insurance;
2727 (II) the names of any other producers, limited line producers, consultants, managing
2728 general agents, or reinsurance intermediaries from whom business is accepted, and of persons
2729 to whom commissions or allowances of any kind are promised or paid; and
2730 (III) a record of [
2731 insurance regulator;
2732 (B) if the licensee is a consultant, a record of each agreement outlining the work
2733 performed and the fee for the work; and
2734 (C) any additional information which:
2735 (I) is customary for a similar business; or
2736 (II) may reasonably be required by the commissioner by rule.
2737 (3) Subsection (2) is satisfied if the books and records specified in Subsection (2) can
2738 be obtained immediately from a central storage place or elsewhere by on-line computer
2739 terminals located at the registered address.
2740 (4) A licensee who represents only a single insurer satisfies Subsection (2) if the
2741 insurer maintains the books and records pursuant to Subsection (2) at a place satisfying
2742 Subsections (1) and (5).
2743 (5) (a) The books and records maintained under Subsection (2) or Section
2744 31A-23a-413 shall be available for the inspection of the commissioner during all business
2745 hours for a period of time after the date of the transaction as specified by the commissioner by
2746 rule, but in no case for less than the current calendar year plus three years.
2747 (b) Discarding books and records after the applicable record retention period has
2748 expired does not place the licensee in violation of a later-adopted longer record retention
2750 Section 26. Section 31A-23a-415 is amended to read:
2751 31A-23a-415. Assessment on title insurance agencies or title insurers -- Account
2753 (1) For purposes of this section:
2754 (a) "Premium" is as defined in Subsection 59-9-101 (3).
2755 (b) "Title insurer" means a person:
2756 (i) making any contract or policy of title insurance as:
2757 (A) insurer;
2758 (B) guarantor; or
2759 (C) surety;
2760 (ii) proposing to make any contract or policy of title insurance as:
2761 (A) insurer;
2762 (B) guarantor; or
2763 (C) surety; or
2764 (iii) transacting or proposing to transact any phase of title insurance, including:
2765 (A) soliciting;
2766 (B) negotiating preliminary to execution;
2767 (C) executing of a contract of title insurance;
2768 (D) insuring; and
2769 (E) transacting matters subsequent to the execution of the contract and arising out of
2770 the contract.
2771 (c) "Utah risks" means insuring, guaranteeing, or indemnifying with regard to real or
2772 personal property located in Utah, an owner of real or personal property, the holders of liens or
2773 encumbrances on that property, or others interested in the property against loss or damage
2774 suffered by reason of:
2775 (i) liens or encumbrances upon, defects in, or the unmarketability of the title to the
2776 property; or
2777 (ii) invalidity or unenforceability of any liens or encumbrances on the property.
2778 (2) (a) The commissioner may assess each title insurer and each title insurance agency
2779 an annual assessment:
2780 (i) determined by the Title and Escrow Commission:
2781 (A) after consultation with the commissioner; and
2782 (B) in accordance with this Subsection (2); and
2783 (ii) to be used for the purposes described in Subsection (3).
2784 (b) A title insurance agency shall be assessed up to:
2785 (i) [
2786 maintains an office; and
2787 (ii) [
2788 county described in Subsection (2)(b)(i).
2789 (c) A title insurer shall be assessed up to:
2790 (i) [
2792 (ii) [
2793 described in Subsection (2)(c)(i); and
2794 (iii) an amount calculated by:
2795 (A) aggregating the assessments imposed on:
2796 (I) title insurance agencies under Subsection (2)(b); and
2797 (II) title insurers under Subsections (2)(c)(i) and (2)(c)(ii);
2798 (B) subtracting the amount determined under Subsection (2)(c)(iii)(A) from the total
2799 costs and expenses determined under Subsection (2)(d); and
2800 (C) multiplying:
2801 (I) the amount calculated under Subsection (2)(c)(iii)(B); and
2802 (II) the percentage of total premiums for title insurance on Utah risk that are premiums
2803 of the title insurer.
2804 (d) Notwithstanding Section 31A-3-103 and subject to Section 31A-2-404 , the Title
2805 and Escrow Commission by rule shall establish the amount of costs and expenses described
2806 under Subsection (3) that will be covered by the assessment, except the costs or expenses to be
2807 covered by the assessment may not exceed [
2808 (3) (a) Money received by the state under this section shall be deposited into the Title
2809 Licensee Enforcement Restricted Account.
2810 (b) There is created in the General Fund a restricted account known as the "Title
2811 Licensee Enforcement Restricted Account."
2812 (c) The Title Licensee Enforcement Restricted Account shall consist of the money
2813 received by the state under this section.
2814 (d) The commissioner shall administer the Title Licensee Enforcement Restricted
2815 Account. Subject to appropriations by the Legislature, the commissioner shall use the money
2816 deposited into the Title Licensee Enforcement Restricted Account only to pay for a cost or
2817 expense incurred by the department in the administration, investigation, and enforcement of
2818 this part and Part 5, Compensation of Producers and Consultants, related to:
2819 (i) the marketing of title insurance; and
2820 (ii) audits of agencies.
2821 (e) An appropriation from the Title Licensee Enforcement Restricted Account is
2823 (4) The assessment imposed by this section shall be in addition to any premium
2824 assessment imposed under Subsection 59-9-101 (3).
2825 Section 27. Section 31A-23a-501 is amended to read:
2826 31A-23a-501. Licensee compensation.
2827 (1) As used in this section:
2828 (a) "Commission compensation" includes funds paid to or credited for the benefit of a
2829 licensee from:
2830 (i) commission amounts deducted from insurance premiums on insurance sold by or
2831 placed through the licensee; or
2832 (ii) commission amounts received from an insurer or another licensee as a result of the
2833 sale or placement of insurance.
2834 (b) (i) "Compensation from an insurer or third party administrator" means
2835 commissions, fees, awards, overrides, bonuses, contingent commissions, loans, stock options,
2836 gifts, prizes, or any other form of valuable consideration:
2837 (A) whether or not payable pursuant to a written agreement; and
2838 (B) received from:
2839 (I) an insurer; or
2840 (II) a third party to the transaction for the sale or placement of insurance.
2841 (ii) "Compensation from an insurer or third party administrator" does not mean
2842 compensation from a customer that is:
2843 (A) a fee or pass-through costs as provided in Subsection (1)(e); or
2844 (B) a fee or amount collected by or paid to the producer that does not exceed an
2845 amount established by the commissioner by administrative rule.
2846 (c) (i) "Customer" means:
2847 (A) the person signing the application or submission for insurance; or
2848 (B) the authorized representative of the insured actually negotiating the placement of
2849 insurance with the producer.
2850 (ii) "Customer" does not mean a person who is a participant or beneficiary of:
2851 (A) an employee benefit plan; or
2852 (B) a group or blanket insurance policy or group annuity contract sold, solicited, or
2853 negotiated by the producer or affiliate.
2854 (d) (i) "Noncommission compensation" includes all funds paid to or credited for the
2855 benefit of a licensee other than commission compensation.
2856 (ii) "Noncommission compensation" does not include charges for pass-through costs
2857 incurred by the licensee in connection with obtaining, placing, or servicing an insurance policy.
2858 (e) "Pass-through costs" include:
2859 (i) costs for copying documents to be submitted to the insurer; and
2860 (ii) bank costs for processing cash or credit card payments.
2861 (2) A licensee may receive from an insured or from a person purchasing an insurance
2862 policy, noncommission compensation if the noncommission compensation is stated on a
2863 separate, written disclosure.
2864 (a) The disclosure required by this Subsection (2) shall:
2865 (i) include the signature of the insured or prospective insured acknowledging the
2866 noncommission compensation;
2867 (ii) clearly specify the amount or extent of the noncommission compensation; and
2868 (iii) be provided to the insured or prospective insured before the performance of the
2870 (b) Noncommission compensation shall be:
2871 (i) limited to actual or reasonable expenses incurred for services; and
2872 (ii) uniformly applied to all insureds or prospective insureds in a class or classes of
2873 business or for a specific service or services.
2874 (c) A copy of the signed disclosure required by this Subsection (2) must be maintained
2875 by any licensee who collects or receives the noncommission compensation or any portion of
2876 the noncommission compensation.
2877 (d) All accounting records relating to noncommission compensation shall be
2878 maintained by the person described in Subsection (2)(c) in a manner that facilitates an audit.
2879 (3) (a) A licensee may receive noncommission compensation when acting as a
2880 producer for the insured in connection with the actual sale or placement of insurance if:
2881 (i) the producer and the insured have agreed on the producer's noncommission
2882 compensation; and
2883 (ii) the producer has disclosed to the insured the existence and source of any other
2884 compensation that accrues to the producer as a result of the transaction.
2885 (b) The disclosure required by this Subsection (3) shall:
2886 (i) include the signature of the insured or prospective insured acknowledging the
2887 noncommission compensation;
2888 (ii) clearly specify the amount or extent of the noncommission compensation and the
2889 existence and source of any other compensation; and
2890 (iii) be provided to the insured or prospective insured before the performance of the
2892 (c) The following additional noncommission compensation is authorized:
2893 (i) compensation received by a producer of a compensated corporate surety who under
2894 procedures approved by a rule or order of the commissioner is paid by surety bond principal
2895 debtors for extra services;
2896 (ii) compensation received by an insurance producer who is also licensed as a public
2897 adjuster under Section 31A-26-203 , for services performed for an insured in connection with a
2898 claim adjustment, so long as the producer does not receive or is not promised compensation for
2899 aiding in the claim adjustment prior to the occurrence of the claim;
2900 (iii) compensation received by a consultant as a consulting fee, provided the consultant
2901 complies with the requirements of Section 31A-23a-401 ; or
2902 (iv) other compensation arrangements approved by the commissioner after a finding
2903 that they do not violate Section 31A-23a-401 and are not harmful to the public.
2904 (4) (a) For purposes of this Subsection (4), "producer" includes:
2905 (i) a producer;
2906 (ii) an affiliate of a producer; or
2907 (iii) a consultant.
2908 (b) Beginning January 1, 2010, in addition to any other disclosures required by this
2909 section, a producer may not accept or receive any compensation from an insurer or third party
2910 administrator for the placement of a health benefit plan, other than a hospital confinement
2911 indemnity policy, unless prior to the customer's purchase of the health benefit plan the
2913 (i) except as provided in Subsection (4)(c), discloses in writing to the customer that the
2914 producer will receive compensation from the insurer or third party administrator for the
2915 placement of insurance, including the amount or type of compensation known to the producer
2916 at the time of the disclosure; and
2917 (ii) except as provided in Subsection (4)(c):
2918 (A) obtains the customer's signed acknowledgment that the disclosure under
2919 Subsection (4)(b)(i) was made to the customer; or
2920 (B) (I) signs a statement that the disclosure required by Subsection (4)(b)(i) was made
2921 to the customer; and
2922 (II) keeps the signed statement on file in the producer's office while the health benefit
2923 plan placed with the customer is in force.
2924 (c) If the compensation to the producer from an insurer or third party administrator is
2925 for the renewal of a health benefit plan, once the producer has made an initial disclosure that
2926 complies with Subsection (4)(b), the producer does not have to disclose compensation received
2927 for the subsequent yearly renewals in accordance with Subsection (4)(b) until the renewal
2928 period immediately following 36 months after the initial disclosure.
2929 (d) (i) A licensee who collects or receives any part of the compensation from an insurer
2930 or third party administrator in a manner that facilitates an audit shall, while the health benefit
2931 plan placed with the customer is in force, maintain a copy of:
2932 (A) the signed acknowledgment described in Subsection (4)(b)(i); or
2933 (B) the signed statement described in Subsection (4)(b)(ii).
2934 (ii) The standard application developed in accordance with Section 31A-22-635 shall
2935 include a place for a producer to provide the disclosure required by this Subsection (4), and if
2936 completed, shall satisfy the requirement of Subsection (4)(d)(i).
2937 (e) Subsection (4)(b)(ii) does not apply to:
2938 (i) a person licensed as a producer who acts only as an intermediary between an insurer
2939 and the customer's producer, including a managing general agent; or
2940 (ii) the placement of insurance in a secondary or residual market.
2941 (5) This section does not alter the right of any licensee to recover from an insured the
2942 amount of any premium due for insurance effected by or through that licensee or to charge a
2943 reasonable rate of interest upon past-due accounts.
2944 (6) This section does not apply to bail bond producers or bail enforcement agents as
2945 defined in Section 31A-35-102 .
2946 (7) A licensee may not receive noncommission compensation from an insured or
2947 enrollee for providing a service or engaging in an act that is required to be provided or
2948 performed in order to receive commission compensation, except for the surplus lines
2949 transactions that do not receive commissions.
2950 Section 28. Section 31A-25-208 is amended to read:
2951 31A-25-208. Revocation, suspension, surrender, lapsing, limiting, or otherwise
2952 terminating a license -- Rulemaking for renewal and reinstatement.
2953 (1) A license type issued under this chapter remains in force until:
2954 (a) revoked or suspended under Subsection (4);
2955 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
2956 administrative action;
2957 (c) the licensee dies or is adjudicated incompetent as defined under:
2958 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2959 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2961 (d) lapsed under Section 31A-25-210 ; or
2962 (e) voluntarily surrendered.
2963 (2) The following may be reinstated within one year after the day on which the license
2964 is no longer in force:
2965 (a) a lapsed license; or
2966 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
2967 not be reinstated after the license period in which the license is voluntarily surrendered.
2968 (3) Unless otherwise stated in [
2969 license, submission and acceptance of a voluntary surrender of a license does not prevent the
2970 department from pursuing additional disciplinary or other action authorized under:
2971 (a) this title; or
2972 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
2973 Administrative Rulemaking Act.
2974 (4) (a) If the commissioner makes a finding under Subsection (4)(b), as part of an
2975 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
2976 commissioner may:
2977 (i) revoke a license;
2978 (ii) suspend a license for a specified period of 12 months or less;
2979 (iii) limit a license in whole or in part; or
2980 (iv) deny a license application.
2981 (b) The commissioner may take an action described in Subsection (4)(a) if the
2982 commissioner finds that the licensee:
2983 (i) is unqualified for a license under Section 31A-25-202 , 31A-25-203 , or 31A-25-204 ;
2984 (ii) has violated:
2985 (A) an insurance statute;
2986 (B) a rule that is valid under Subsection 31A-2-201 (3); or
2987 (C) an order that is valid under Subsection 31A-2-201 (4);
2988 (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
2989 delinquency proceedings in any state;
2990 (iv) fails to pay a final judgment rendered against the person in this state within 60
2991 days after the day on which the judgment became final;
2992 (v) fails to meet the same good faith obligations in claims settlement that is required of
2993 admitted insurers;
2994 (vi) is affiliated with and under the same general management or interlocking
2995 directorate or ownership as another third party administrator that transacts business in this state
2996 without a license;
2997 (vii) refuses:
2998 (A) to be examined; or
2999 (B) to produce its accounts, records, and files for examination;
3000 (viii) has an officer who refuses to:
3001 (A) give information with respect to the third party administrator's affairs; or
3002 (B) perform any other legal obligation as to an examination;
3003 (ix) provides information in the license application that is:
3004 (A) incorrect;
3005 (B) misleading;
3006 (C) incomplete; or
3007 (D) materially untrue;
3008 (x) has violated an insurance law, valid rule, or valid order of another state's insurance
3010 (xi) has obtained or attempted to obtain a license through misrepresentation or fraud;
3011 (xii) has improperly withheld, misappropriated, or converted money or properties
3012 received in the course of doing insurance business;
3013 (xiii) has intentionally misrepresented the terms of an actual or proposed:
3014 (A) insurance contract; or
3015 (B) application for insurance;
3016 (xiv) has been convicted of a felony;
3017 (xv) has admitted or been found to have committed an insurance unfair trade practice
3018 or fraud;
3019 (xvi) in the conduct of business in this state or elsewhere has:
3020 (A) used fraudulent, coercive, or dishonest practices; or
3021 (B) demonstrated incompetence, untrustworthiness, or financial irresponsibility;
3022 (xvii) has had an insurance license or its equivalent, denied, suspended, or revoked in
3023 any other state, province, district, or territory;
3024 (xviii) has forged another's name to:
3025 (A) an application for insurance; or
3026 (B) a document related to an insurance transaction;
3027 (xix) has improperly used notes or any other reference material to complete an
3028 examination for an insurance license;
3029 (xx) has knowingly accepted insurance business from an individual who is not
3031 (xxi) has failed to comply with an administrative or court order imposing a child
3032 support obligation;
3033 (xxii) has failed to:
3034 (A) pay state income tax; or
3035 (B) comply with an administrative or court order directing payment of state income
3037 (xxiii) has violated or permitted others to violate the federal Violent Crime Control and
3038 Law Enforcement Act of 1994, 18 U.S.C. [
3039 (xxiv) has engaged in methods and practices in the conduct of business that endanger
3040 the legitimate interests of customers and the public.
3041 (c) For purposes of this section, if a license is held by an agency, both the agency itself
3042 and any individual designated under the license are considered to be the holders of the agency
3044 (d) If an individual designated under the agency license commits an act or fails to
3045 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
3046 the commissioner may suspend, revoke, or limit the license of:
3047 (i) the individual;
3048 (ii) the agency if the agency:
3049 (A) is reckless or negligent in its supervision of the individual; or
3050 (B) knowingly participated in the act or failure to act that is the ground for suspending,
3051 revoking, or limiting the license; or
3052 (iii) (A) the individual; and
3053 (B) the agency if the agency meets the requirements of Subsection (4)(d)(ii).
3054 (5) A licensee under this chapter is subject to the penalties for acting as a licensee
3055 without a license if:
3056 (a) the licensee's license is:
3057 (i) revoked;
3058 (ii) suspended;
3059 (iii) limited;
3060 (iv) surrendered in lieu of administrative action;
3061 (v) lapsed; or
3062 (vi) voluntarily surrendered; and
3063 (b) the licensee:
3064 (i) continues to act as a licensee; or
3065 (ii) violates the terms of the license limitation.
3066 (6) A licensee under this chapter shall immediately report to the commissioner:
3067 (a) a revocation, suspension, or limitation of the person's license in any other state, the
3068 District of Columbia, or a territory of the United States;
3069 (b) the imposition of a disciplinary sanction imposed on that person by any other state,
3070 the District of Columbia, or a territory of the United States; or
3071 (c) a judgment or injunction entered against the person on the basis of conduct
3073 (i) fraud;
3074 (ii) deceit;
3075 (iii) misrepresentation; or
3076 (iv) a violation of an insurance law or rule.