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H.B. 29 Enrolled

             1     

INSURANCE AMENDMENTS

             2     
2012 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: James A. Dunnigan

             5     
Senate Sponsor: Curtis S. Bramble

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill modifies the Insurance Code to make various changes related to the regulation
             10      of insurance.
             11      Highlighted Provisions:
             12          This bill:
             13          .    modifies definition provisions;
             14          .    addresses annual report to policyholders;
             15          .    addresses catastrophic coverage of mental health conditions;
             16          .    amends provisions related to adverse benefit determination review process;
             17          .    addresses when uniform waiver of coverage forms may be combined or modified;
             18          .    provides for the establishment of surplus lines producers;
             19          .    modifies provisions related to inducements;
             20          .    addresses the regulation of customer service representatives;
             21          .    modifies definitions related to insurance marketing and licensing;
             22          .    addresses sharing of commissions;
             23          .    addresses what constitutes administrative action taken against a person that is to be
             24      reported to the commissioner;
             25          .    clarifies when a line of authority no longer remains in force for a person;
             26          .    addresses references to the federal Violent Crime Control and Law Enforcement
             27      Act;
             28          .    requires a person who wants to reinstate a voluntarily surrendered license to comply
             29      with continuing education requirements;


             30          .    addresses special requirements for variable contracts lines of authority;
             31          .    addresses disbursements from certain trust accounts;
             32          .    modifies language regarding trust obligation for certain money;
             33          .    addresses payments of claims by administrator;
             34          .    addresses commissioner's administrative actions;
             35          .    grants rulemaking authority to the commissioner regarding model regulations
             36      related to determining hazardous financial condition of an insurer;
             37          .    changes dates related to coverage under a pool policy;
             38          .    addresses education requirements related to bail bond licensing;
             39          .    addresses filing of forms by bail bond surety companies and surety insurers;
             40          .    deletes definition of basic benefit plan;
             41          .    addresses health benefit plan choices;
             42          .    grants immunity related to good faith communications between insurers or
             43      employees of insurers;
             44          .    increases assessments paid by insurers to fund costs and expenses incurred by the
             45      Department of Insurance in the administration, investigation, and enforcement of
             46      provisions related to insurance fraud;
             47          .    addresses reporting by the board of directors of the Utah Defined Contribution Risk
             48      Adjuster; and
             49          .    makes technical and conforming amendments.
             50      Money Appropriated in this Bill:
             51          None
             52      Other Special Clauses:
             53          None
             54      Utah Code Sections Affected:
             55      AMENDS:
             56          31A-1-301, as last amended by Laws of Utah 2011, Chapters 284 and 366
             57          31A-2-308, as last amended by Laws of Utah 2009, Chapter 347


             58          31A-2-404, as last amended by Laws of Utah 2010, Chapter 10
             59          31A-7-302, as enacted by Laws of Utah 1985, Chapter 242
             60          31A-22-625, as last amended by Laws of Utah 2011, Chapters 240, 284, 297, 366, and
             61      400
             62          31A-22-629, as last amended by Laws of Utah 2007, Chapter 307
             63          31A-22-635, as last amended by Laws of Utah 2011, Chapter 400
             64          31A-23a-101, as renumbered and amended by Laws of Utah 2003, Chapter 298
             65          31A-23a-102, as last amended by Laws of Utah 2011, Chapter 284
             66          31A-23a-103, as renumbered and amended by Laws of Utah 2003, Chapter 298
             67          31A-23a-104, as last amended by Laws of Utah 2011, Chapter 337
             68          31A-23a-105, as last amended by Laws of Utah 2011, Chapter 337
             69          31A-23a-106, as last amended by Laws of Utah 2011, Chapter 284
             70          31A-23a-107, as renumbered and amended by Laws of Utah 2003, Chapter 298
             71          31A-23a-108, as last amended by Laws of Utah 2005, Chapters 185 and 219
             72          31A-23a-109, as last amended by Laws of Utah 2008, Chapter 3
             73          31A-23a-111, as last amended by Laws of Utah 2011, Chapter 284
             74          31A-23a-113, as last amended by Laws of Utah 2009, Chapter 349
             75          31A-23a-115.5, as enacted by Laws of Utah 2011, Chapter 400
             76          31A-23a-203, as last amended by Laws of Utah 2011, Chapter 284
             77          31A-23a-206, as renumbered and amended by Laws of Utah 2003, Chapter 298
             78          31A-23a-301, as enacted by Laws of Utah 2003, Chapter 298
             79          31A-23a-302, as last amended by Laws of Utah 2009, Chapter 349
             80          31A-23a-402.5, as enacted by Laws of Utah 2011, Chapter 62
             81          31A-23a-406, as last amended by Laws of Utah 2011, Chapter 284
             82          31A-23a-409, as last amended by Laws of Utah 2011, Chapter 342
             83          31A-23a-412, as last amended by Laws of Utah 2011, Chapter 284
             84          31A-23a-504, as last amended by Laws of Utah 2011, Chapter 62
             85          31A-25-203, as last amended by Laws of Utah 2009, Chapter 349


             86          31A-25-306, as enacted by Laws of Utah 1985, Chapter 242
             87          31A-26-203, as last amended by Laws of Utah 2009, Chapter 349
             88          31A-27-503, as renumbered and amended by Laws of Utah 2007, Chapter 309
             89          31A-27a-101, as enacted by Laws of Utah 2007, Chapter 309
             90          31A-27a-104, as last amended by Laws of Utah 2009, Chapter 355
             91          31A-29-112, as last amended by Laws of Utah 2004, Chapter 2
             92          31A-30-103, as last amended by Laws of Utah 2011, Chapters 284 and 400
             93          31A-30-109, as last amended by Laws of Utah 2009, Chapter 12
             94          31A-30-112, as last amended by Laws of Utah 2011, Chapter 284
             95          31A-31-105, as last amended by Laws of Utah 2008, Chapter 150
             96          31A-31-108, as last amended by Laws of Utah 2011, Chapter 284
             97          31A-35-401.5, as enacted by Laws of Utah 2011, Chapter 179
             98          31A-35-607, as last amended by Laws of Utah 2000, Chapter 259
             99          31A-41-301, as enacted by Laws of Utah 2008, Chapter 220
             100          31A-42-203, as enacted by Laws of Utah 2009, Chapter 12
             101     
             102      Be it enacted by the Legislature of the state of Utah:
             103          Section 1. Section 31A-1-301 is amended to read:
             104           31A-1-301. Definitions.
             105          As used in this title, unless otherwise specified:
             106          (1) (a) "Accident and health insurance" means insurance to provide protection against
             107      economic losses resulting from:
             108          (i) a medical condition including:
             109          (A) a medical care expense; or
             110          (B) the risk of disability;
             111          (ii) accident; or
             112          (iii) sickness.
             113          (b) "Accident and health insurance":


             114          (i) includes a contract with disability contingencies including:
             115          (A) an income replacement contract;
             116          (B) a health care contract;
             117          (C) an expense reimbursement contract;
             118          (D) a credit accident and health contract;
             119          (E) a continuing care contract; and
             120          (F) a long-term care contract; and
             121          (ii) may provide:
             122          (A) hospital coverage;
             123          (B) surgical coverage;
             124          (C) medical coverage;
             125          (D) loss of income coverage;
             126          (E) prescription drug coverage;
             127          (F) dental coverage; or
             128          (G) vision coverage.
             129          (c) "Accident and health insurance" does not include workers' compensation insurance.
             130          (2) "Actuary" is as defined by the commissioner by rule, made in accordance with Title
             131      63G, Chapter 3, Utah Administrative Rulemaking Act.
             132          (3) "Administrator" is defined in Subsection [(161)] (162).
             133          (4) "Adult" means an individual who has attained the age of at least 18 years.
             134          (5) "Affiliate" means a person who controls, is controlled by, or is under common
             135      control with, another person. A corporation is an affiliate of another corporation, regardless of
             136      ownership, if substantially the same group of individuals manage the corporations.
             137          (6) "Agency" means:
             138          (a) a person other than an individual, including a sole proprietorship by which an
             139      individual does business under an assumed name; and
             140          (b) an insurance organization licensed or required to be licensed under Section
             141      31A-23a-301 , 31A-25-207 , or 31A-26-209 .


             142          (7) "Alien insurer" means an insurer domiciled outside the United States.
             143          (8) "Amendment" means an endorsement to an insurance policy or certificate.
             144          (9) "Annuity" means an agreement to make periodical payments for a period certain or
             145      over the lifetime of one or more individuals if the making or continuance of all or some of the
             146      series of the payments, or the amount of the payment, is dependent upon the continuance of
             147      human life.
             148          (10) "Application" means a document:
             149          (a) (i) completed by an applicant to provide information about the risk to be insured;
             150      and
             151          (ii) that contains information that is used by the insurer to evaluate risk and decide
             152      whether to:
             153          (A) insure the risk under:
             154          (I) the coverage as originally offered; or
             155          (II) a modification of the coverage as originally offered; or
             156          (B) decline to insure the risk; or
             157          (b) used by the insurer to gather information from the applicant before issuance of an
             158      annuity contract.
             159          (11) "Articles" or "articles of incorporation" means:
             160          (a) the original articles;
             161          (b) a special law;
             162          (c) a charter;
             163          (d) an amendment;
             164          (e) restated articles;
             165          (f) articles of merger or consolidation;
             166          (g) a trust instrument;
             167          (h) another constitutive document for a trust or other entity that is not a corporation;
             168      and
             169          (i) an amendment to an item listed in Subsections (11)(a) through (h).


             170          (12) "Bail bond insurance" means a guarantee that a person will attend court when
             171      required, up to and including surrender of the person in execution of a sentence imposed under
             172      Subsection 77-20-7 (1), as a condition to the release of that person from confinement.
             173          (13) "Binder" is defined in Section 31A-21-102 .
             174          (14) "Blanket insurance policy" means a group policy covering a defined class of
             175      persons:
             176          (a) without individual underwriting or application; and
             177          (b) that is determined by definition without designating each person covered.
             178          (15) "Board," "board of trustees," or "board of directors" means the group of persons
             179      with responsibility over, or management of, a corporation, however designated.
             180          (16) "Bona fide office" means a physical office in this state:
             181          (a) that is open to the public;
             182          (b) that is staffed during regular business hours on regular business days; and
             183          (c) at which the public may appear in person to obtain services.
             184          (17) "Business entity" means:
             185          (a) a corporation;
             186          (b) an association;
             187          (c) a partnership;
             188          (d) a limited liability company;
             189          (e) a limited liability partnership; or
             190          (f) another legal entity.
             191          (18) "Business of insurance" is defined in Subsection [(87)] (88).
             192          (19) "Business plan" means the information required to be supplied to the
             193      commissioner under Subsections 31A-5-204 (2)(i) and (j), including the information required
             194      when these subsections apply by reference under:
             195          (a) Section 31A-7-201 ;
             196          (b) Section 31A-8-205 ; or
             197          (c) Subsection 31A-9-205 (2).


             198          (20) (a) "Bylaws" means the rules adopted for the regulation or management of a
             199      corporation's affairs, however designated.
             200          (b) "Bylaws" includes comparable rules for a trust or other entity that is not a
             201      corporation.
             202          (21) "Captive insurance company" means:
             203          (a) an insurer:
             204          (i) owned by another organization; and
             205          (ii) whose exclusive purpose is to insure risks of the parent organization and an
             206      affiliated company; or
             207          (b) in the case of a group or association, an insurer:
             208          (i) owned by the insureds; and
             209          (ii) whose exclusive purpose is to insure risks of:
             210          (A) a member organization;
             211          (B) a group member; or
             212          (C) an affiliate of:
             213          (I) a member organization; or
             214          (II) a group member.
             215          (22) "Casualty insurance" means liability insurance.
             216          (23) "Certificate" means evidence of insurance given to:
             217          (a) an insured under a group insurance policy; or
             218          (b) a third party.
             219          (24) "Certificate of authority" is included within the term "license."
             220          (25) "Claim," unless the context otherwise requires, means a request or demand on an
             221      insurer for payment of a benefit according to the terms of an insurance policy.
             222          (26) "Claims-made coverage" means an insurance contract or provision limiting
             223      coverage under a policy insuring against legal liability to claims that are first made against the
             224      insured while the policy is in force.
             225          (27) (a) "Commissioner" or "commissioner of insurance" means Utah's insurance


             226      commissioner.
             227          (b) When appropriate, the terms listed in Subsection (27)(a) apply to the equivalent
             228      supervisory official of another jurisdiction.
             229          (28) (a) "Continuing care insurance" means insurance that:
             230          (i) provides board and lodging;
             231          (ii) provides one or more of the following:
             232          (A) a personal service;
             233          (B) a nursing service;
             234          (C) a medical service; or
             235          (D) any other health-related service; and
             236          (iii) provides the coverage described in this Subsection (28)(a) under an agreement
             237      effective:
             238          (A) for the life of the insured; or
             239          (B) for a period in excess of one year.
             240          (b) Insurance is continuing care insurance regardless of whether or not the board and
             241      lodging are provided at the same location as a service described in Subsection (28)(a)(ii).
             242          (29) (a) "Control," "controlling," "controlled," or "under common control" means the
             243      direct or indirect possession of the power to direct or cause the direction of the management
             244      and policies of a person. This control may be:
             245          (i) by contract;
             246          (ii) by common management;
             247          (iii) through the ownership of voting securities; or
             248          (iv) by a means other than those described in Subsections (29)(a)(i) through (iii).
             249          (b) There is no presumption that an individual holding an official position with another
             250      person controls that person solely by reason of the position.
             251          (c) A person having a contract or arrangement giving control is considered to have
             252      control despite the illegality or invalidity of the contract or arrangement.
             253          (d) There is a rebuttable presumption of control in a person who directly or indirectly


             254      owns, controls, holds with the power to vote, or holds proxies to vote 10% or more of the
             255      voting securities of another person.
             256          (30) "Controlled insurer" means a licensed insurer that is either directly or indirectly
             257      controlled by a producer.
             258          (31) "Controlling person" means a person that directly or indirectly has the power to
             259      direct or cause to be directed, the management, control, or activities of a reinsurance
             260      intermediary.
             261          (32) "Controlling producer" means a producer who directly or indirectly controls an
             262      insurer.
             263          (33) (a) "Corporation" means an insurance corporation, except when referring to:
             264          (i) a corporation doing business:
             265          (A) as:
             266          (I) an insurance producer;
             267          (II) a surplus lines producer;
             268          [(II)] (III) a limited line producer;
             269          [(III)] (IV) a consultant;
             270          [(IV)] (V) a managing general agent;
             271          [(V)] (VI) a reinsurance intermediary;
             272          [(VI)] (VII) a third party administrator; or
             273          [(VII)] (VIII) an adjuster; and
             274          (B) under:
             275          (I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
             276      Reinsurance Intermediaries;
             277          (II) Chapter 25, Third Party Administrators; or
             278          (III) Chapter 26, Insurance Adjusters; or
             279          (ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance
             280      Holding Companies.
             281          (b) "Stock corporation" means a stock insurance corporation.


             282          (c) "Mutual" or "mutual corporation" means a mutual insurance corporation.
             283          (34) (a) "Creditable coverage" has the same meaning as provided in federal regulations
             284      adopted pursuant to the Health Insurance Portability and Accountability Act.
             285          (b) "Creditable coverage" includes coverage that is offered through a public health plan
             286      such as:
             287          (i) the Primary Care Network Program under a Medicaid primary care network
             288      demonstration waiver obtained subject to Section 26-18-3 ;
             289          (ii) the Children's Health Insurance Program under Section 26-40-106 ; or
             290          (iii) the Ryan White Program Comprehensive AIDS Resources Emergency Act, Pub. L.
             291      101-381, and Ryan White HIV/AIDS Treatment Modernization Act of 2006, Pub. L. 109-415.
             292          (35) "Credit accident and health insurance" means insurance on a debtor to provide
             293      indemnity for payments coming due on a specific loan or other credit transaction while the
             294      debtor has a disability.
             295          (36) (a) "Credit insurance" means insurance offered in connection with an extension of
             296      credit that is limited to partially or wholly extinguishing that credit obligation.
             297          (b) "Credit insurance" includes:
             298          (i) credit accident and health insurance;
             299          (ii) credit life insurance;
             300          (iii) credit property insurance;
             301          (iv) credit unemployment insurance;
             302          (v) guaranteed automobile protection insurance;
             303          (vi) involuntary unemployment insurance;
             304          (vii) mortgage accident and health insurance;
             305          (viii) mortgage guaranty insurance; and
             306          (ix) mortgage life insurance.
             307          (37) "Credit life insurance" means insurance on the life of a debtor in connection with
             308      an extension of credit that pays a person if the debtor dies.
             309          (38) "Credit property insurance" means insurance:


             310          (a) offered in connection with an extension of credit; and
             311          (b) that protects the property until the debt is paid.
             312          (39) "Credit unemployment insurance" means insurance:
             313          (a) offered in connection with an extension of credit; and
             314          (b) that provides indemnity if the debtor is unemployed for payments coming due on a:
             315          (i) specific loan; or
             316          (ii) credit transaction.
             317          (40) "Creditor" means a person, including an insured, having a claim, whether:
             318          (a) matured;
             319          (b) unmatured;
             320          (c) liquidated;
             321          (d) unliquidated;
             322          (e) secured;
             323          (f) unsecured;
             324          (g) absolute;
             325          (h) fixed; or
             326          (i) contingent.
             327          (41) (a) "Crop insurance" means insurance providing protection against damage to
             328      crops from unfavorable weather conditions, fire or lightning, flood, hail, insect infestation,
             329      disease, or other yield-reducing conditions or perils that is:
             330          (i) provided by the private insurance market; or
             331          (ii) subsidized by the Federal Crop Insurance Corporation.
             332          (b) "Crop insurance" includes multiperil crop insurance.
             333          [(41)] (42) (a) "Customer service representative" means a person that provides an
             334      insurance service and insurance product information:
             335          (i) for the customer service representative's:
             336          (A) producer; [or]
             337          (B) surplus lines producer; or


             338          [(B)] (C) consultant employer; and
             339          (ii) to the customer service representative's employer's:
             340          (A) customer;
             341          (B) client; or
             342          (C) organization.
             343          (b) A customer service representative may only operate within the scope of authority of
             344      the customer service representative's producer, surplus lines producer, or consultant employer.
             345          [(42)] (43) "Deadline" means a final date or time:
             346          (a) imposed by:
             347          (i) statute;
             348          (ii) rule; or
             349          (iii) order; and
             350          (b) by which a required filing or payment must be received by the department.
             351          [(43)] (44) "Deemer clause" means a provision under this title under which upon the
             352      occurrence of a condition precedent, the commissioner is considered to have taken a specific
             353      action. If the statute so provides, a condition precedent may be the commissioner's failure to
             354      take a specific action.
             355          [(44)] (45) "Degree of relationship" means the number of steps between two persons
             356      determined by counting the generations separating one person from a common ancestor and
             357      then counting the generations to the other person.
             358          [(45)] (46) "Department" means the Insurance Department.
             359          [(46)] (47) "Director" means a member of the board of directors of a corporation.
             360          [(47)] (48) "Disability" means a physiological or psychological condition that partially
             361      or totally limits an individual's ability to:
             362          (a) perform the duties of:
             363          (i) that individual's occupation; or
             364          (ii) any occupation for which the individual is reasonably suited by education, training,
             365      or experience; or


             366          (b) perform two or more of the following basic activities of daily living:
             367          (i) eating;
             368          (ii) toileting;
             369          (iii) transferring;
             370          (iv) bathing; or
             371          (v) dressing.
             372          [(48)] (49) "Disability income insurance" is defined in Subsection [(78)] (79).
             373          [(49)] (50) "Domestic insurer" means an insurer organized under the laws of this state.
             374          [(50)] (51) "Domiciliary state" means the state in which an insurer:
             375          (a) is incorporated;
             376          (b) is organized; or
             377          (c) in the case of an alien insurer, enters into the United States.
             378          [(51)] (52) (a) "Eligible employee" means:
             379          (i) an employee who:
             380          (A) works on a full-time basis; and
             381          (B) has a normal work week of 30 or more hours; or
             382          (ii) a person described in Subsection [(51)] (52)(b).
             383          (b) "Eligible employee" includes, if the individual is included under a health benefit
             384      plan of a small employer:
             385          (i) a sole proprietor;
             386          (ii) a partner in a partnership; or
             387          (iii) an independent contractor.
             388          (c) "Eligible employee" does not include, unless eligible under Subsection [(51)]
             389      (52)(b):
             390          (i) an individual who works on a temporary or substitute basis for a small employer;
             391          (ii) an employer's spouse; or
             392          (iii) a dependent of an employer.
             393          [(52)] (53) "Employee" means an individual employed by an employer.


             394          [(53)] (54) "Employee benefits" means one or more benefits or services provided to:
             395          (a) an employee; or
             396          (b) a dependent of an employee.
             397          [(54)] (55) (a) "Employee welfare fund" means a fund:
             398          (i) established or maintained, whether directly or through a trustee, by:
             399          (A) one or more employers;
             400          (B) one or more labor organizations; or
             401          (C) a combination of employers and labor organizations; and
             402          (ii) that provides employee benefits paid or contracted to be paid, other than income
             403      from investments of the fund:
             404          (A) by or on behalf of an employer doing business in this state; or
             405          (B) for the benefit of a person employed in this state.
             406          (b) "Employee welfare fund" includes a plan funded or subsidized by a user fee or tax
             407      revenues.
             408          [(55)] (56) "Endorsement" means a written agreement attached to a policy or certificate
             409      to modify the policy or certificate coverage.
             410          [(56)] (57) "Enrollment date," with respect to a health benefit plan, means:
             411          (a) the first day of coverage; or
             412          (b) if there is a waiting period, the first day of the waiting period.
             413          [(57)] (58) (a) "Escrow" means:
             414          (i) a real estate settlement or real estate closing conducted by a third party pursuant to
             415      the requirements of a written agreement between the parties in a real estate transaction; or
             416          (ii) a settlement or closing involving:
             417          (A) a mobile home;
             418          (B) a grazing right;
             419          (C) a water right; or
             420          (D) other personal property authorized by the commissioner.
             421          (b) "Escrow" includes the act of conducting a:


             422          (i) real estate settlement; or
             423          (ii) real estate closing.
             424          [(58)] (59) "Escrow agent" means:
             425          (a) an insurance producer with:
             426          (i) a title insurance line of authority; and
             427          (ii) an escrow subline of authority; or
             428          (b) a person defined as an escrow agent in Section 7-22-101 .
             429          [(59)] (60) (a) "Excludes" is not exhaustive and does not mean that another thing is not
             430      also excluded.
             431          (b) The items listed in a list using the term "excludes" are representative examples for
             432      use in interpretation of this title.
             433          [(60)] (61) "Exclusion" means for the purposes of accident and health insurance that an
             434      insurer does not provide insurance coverage, for whatever reason, for one of the following:
             435          (a) a specific physical condition;
             436          (b) a specific medical procedure;
             437          (c) a specific disease or disorder; or
             438          (d) a specific prescription drug or class of prescription drugs.
             439          [(61)] (62) "Expense reimbursement insurance" means insurance:
             440          (a) written to provide a payment for an expense relating to hospital confinement
             441      resulting from illness or injury; and
             442          (b) written:
             443          (i) as a daily limit for a specific number of days in a hospital; and
             444          (ii) to have a one or two day waiting period following a hospitalization.
             445          [(62)] (63) "Fidelity insurance" means insurance guaranteeing the fidelity of a person
             446      holding a position of public or private trust.
             447          [(63)] (64) (a) "Filed" means that a filing is:
             448          (i) submitted to the department as required by and in accordance with applicable
             449      statute, rule, or filing order;


             450          (ii) received by the department within the time period provided in applicable statute,
             451      rule, or filing order; and
             452          (iii) accompanied by the appropriate fee in accordance with:
             453          (A) Section 31A-3-103 ; or
             454          (B) rule.
             455          (b) "Filed" does not include a filing that is rejected by the department because it is not
             456      submitted in accordance with Subsection [(63)] (64)(a).
             457          [(64)] (65) "Filing," when used as a noun, means an item required to be filed with the
             458      department including:
             459          (a) a policy;
             460          (b) a rate;
             461          (c) a form;
             462          (d) a document;
             463          (e) a plan;
             464          (f) a manual;
             465          (g) an application;
             466          (h) a report;
             467          (i) a certificate;
             468          (j) an endorsement;
             469          (k) an actuarial certification;
             470          (l) a licensee annual statement;
             471          (m) a licensee renewal application;
             472          (n) an advertisement; or
             473          (o) an outline of coverage.
             474          [(65)] (66) "First party insurance" means an insurance policy or contract in which the
             475      insurer agrees to pay a claim submitted to it by the insured for the insured's losses.
             476          [(66)] (67) "Foreign insurer" means an insurer domiciled outside of this state, including
             477      an alien insurer.


             478          [(67)] (68) (a) "Form" means one of the following prepared for general use:
             479          (i) a policy;
             480          (ii) a certificate;
             481          (iii) an application;
             482          (iv) an outline of coverage; or
             483          (v) an endorsement.
             484          (b) "Form" does not include a document specially prepared for use in an individual
             485      case.
             486          [(68)] (69) "Franchise insurance" means an individual insurance policy provided
             487      through a mass marketing arrangement involving a defined class of persons related in some
             488      way other than through the purchase of insurance.
             489          [(69)] (70) "General lines of authority" include:
             490          (a) the general lines of insurance in Subsection [(70)] (71);
             491          (b) title insurance under one of the following sublines of authority:
             492          (i) search, including authority to act as a title marketing representative;
             493          (ii) escrow, including authority to act as a title marketing representative; and
             494          (iii) title marketing representative only;
             495          (c) surplus lines;
             496          (d) workers' compensation; and
             497          (e) any other line of insurance that the commissioner considers necessary to recognize
             498      in the public interest.
             499          [(70)] (71) "General lines of insurance" include:
             500          (a) accident and health;
             501          (b) casualty;
             502          (c) life;
             503          (d) personal lines;
             504          (e) property; and
             505          (f) variable contracts, including variable life and annuity.


             506          [(71)] (72) "Group health plan" means an employee welfare benefit plan to the extent
             507      that the plan provides medical care:
             508          (a) (i) to an employee; or
             509          (ii) to a dependent of an employee; and
             510          (b) (i) directly;
             511          (ii) through insurance reimbursement; or
             512          (iii) through another method.
             513          [(72)] (73) (a) "Group insurance policy" means a policy covering a group of persons
             514      that is issued:
             515          (i) to a policyholder on behalf of the group; and
             516          (ii) for the benefit of a member of the group who is selected under a procedure defined
             517      in:
             518          (A) the policy; or
             519          (B) an agreement that is collateral to the policy.
             520          (b) A group insurance policy may include a member of the policyholder's family or a
             521      dependent.
             522          [(73)] (74) "Guaranteed automobile protection insurance" means insurance offered in
             523      connection with an extension of credit that pays the difference in amount between the
             524      insurance settlement and the balance of the loan if the insured automobile is a total loss.
             525          [(74)] (75) (a) Except as provided in Subsection [(74)] (75)(b), "health benefit plan"
             526      means a policy or certificate that:
             527          (i) provides health care insurance;
             528          (ii) provides major medical expense insurance; or
             529          (iii) is offered as a substitute for hospital or medical expense insurance, such as:
             530          (A) a hospital confinement indemnity; or
             531          (B) a limited benefit plan.
             532          (b) "Health benefit plan" does not include a policy or certificate that:
             533          (i) provides benefits solely for:


             534          (A) accident;
             535          (B) dental;
             536          (C) income replacement;
             537          (D) long-term care;
             538          (E) a Medicare supplement;
             539          (F) a specified disease;
             540          (G) vision; or
             541          (H) a short-term limited duration; or
             542          (ii) is offered and marketed as supplemental health insurance.
             543          [(75)] (76) "Health care" means any of the following intended for use in the diagnosis,
             544      treatment, mitigation, or prevention of a human ailment or impairment:
             545          (a) a professional service;
             546          (b) a personal service;
             547          (c) a facility;
             548          (d) equipment;
             549          (e) a device;
             550          (f) supplies; or
             551          (g) medicine.
             552          [(76)] (77) (a) "Health care insurance" or "health insurance" means insurance
             553      providing:
             554          (i) a health care benefit; or
             555          (ii) payment of an incurred health care expense.
             556          (b) "Health care insurance" or "health insurance" does not include accident and health
             557      insurance providing a benefit for:
             558          (i) replacement of income;
             559          (ii) short-term accident;
             560          (iii) fixed indemnity;
             561          (iv) credit accident and health;


             562          (v) supplements to liability;
             563          (vi) workers' compensation;
             564          (vii) automobile medical payment;
             565          (viii) no-fault automobile;
             566          (ix) equivalent self-insurance; or
             567          (x) a type of accident and health insurance coverage that is a part of or attached to
             568      another type of policy.
             569          [(77)] (78) "Health Insurance Portability and Accountability Act" means the Health
             570      Insurance Portability and Accountability Act of 1996, Pub. L. 104-191, 110 Stat. 1936, as
             571      amended.
             572          [(78)] (79) "Income replacement insurance" or "disability income insurance" means
             573      insurance written to provide payments to replace income lost from accident or sickness.
             574          [(79)] (80) "Indemnity" means the payment of an amount to offset all or part of an
             575      insured loss.
             576          [(80)] (81) "Independent adjuster" means an insurance adjuster required to be licensed
             577      under Section 31A-26-201 who engages in insurance adjusting as a representative of an insurer.
             578          [(81)] (82) "Independently procured insurance" means insurance procured under
             579      Section 31A-15-104 .
             580          [(82)] (83) "Individual" means a natural person.
             581          [(83)] (84) "Inland marine insurance" includes insurance covering:
             582          (a) property in transit on or over land;
             583          (b) property in transit over water by means other than boat or ship;
             584          (c) bailee liability;
             585          (d) fixed transportation property such as bridges, electric transmission systems, radio
             586      and television transmission towers and tunnels; and
             587          (e) personal and commercial property floaters.
             588          [(84)] (85) "Insolvency" means that:
             589          (a) an insurer is unable to pay its debts or meet its obligations as the debts and


             590      obligations mature;
             591          (b) an insurer's total adjusted capital is less than the insurer's mandatory control level
             592      RBC under Subsection 31A-17-601 (8)(c); or
             593          (c) an insurer is determined to be hazardous under this title.
             594          [(85)] (86) (a) "Insurance" means:
             595          (i) an arrangement, contract, or plan for the transfer of a risk or risks from one or more
             596      persons to one or more other persons; or
             597          (ii) an arrangement, contract, or plan for the distribution of a risk or risks among a
             598      group of persons that includes the person seeking to distribute that person's risk.
             599          (b) "Insurance" includes:
             600          (i) a risk distributing arrangement providing for compensation or replacement for
             601      damages or loss through the provision of a service or a benefit in kind;
             602          (ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a
             603      business and not as merely incidental to a business transaction; and
             604          (iii) a plan in which the risk does not rest upon the person who makes an arrangement,
             605      but with a class of persons who have agreed to share the risk.
             606          [(86)] (87) "Insurance adjuster" means a person who directs the investigation,
             607      negotiation, or settlement of a claim under an insurance policy other than life insurance or an
             608      annuity, on behalf of an insurer, policyholder, or a claimant under an insurance policy.
             609          [(87)] (88) "Insurance business" or "business of insurance" includes:
             610          (a) providing health care insurance by an organization that is or is required to be
             611      licensed under this title;
             612          (b) providing a benefit to an employee in the event of a contingency not within the
             613      control of the employee, in which the employee is entitled to the benefit as a right, which
             614      benefit may be provided either:
             615          (i) by a single employer or by multiple employer groups; or
             616          (ii) through one or more trusts, associations, or other entities;
             617          (c) providing an annuity:


             618          (i) including an annuity issued in return for a gift; and
             619          (ii) except an annuity provided by a person specified in Subsections 31A-22-1305 (2)
             620      and (3);
             621          (d) providing the characteristic services of a motor club as outlined in Subsection
             622      [(115)] (116);
             623          (e) providing another person with insurance;
             624          (f) making as insurer, guarantor, or surety, or proposing to make as insurer, guarantor,
             625      or surety, a contract or policy of title insurance;
             626          (g) transacting or proposing to transact any phase of title insurance, including:
             627          (i) solicitation;
             628          (ii) negotiation preliminary to execution;
             629          (iii) execution of a contract of title insurance;
             630          (iv) insuring; and
             631          (v) transacting matters subsequent to the execution of the contract and arising out of
             632      the contract, including reinsurance;
             633          (h) transacting or proposing a life settlement; and
             634          (i) doing, or proposing to do, any business in substance equivalent to Subsections
             635      [(87)] (88)(a) through (h) in a manner designed to evade this title.
             636          [(88)] (89) "Insurance consultant" or "consultant" means a person who:
             637          (a) advises another person about insurance needs and coverages;
             638          (b) is compensated by the person advised on a basis not directly related to the insurance
             639      placed; and
             640          (c) except as provided in Section 31A-23a-501 , is not compensated directly or
             641      indirectly by an insurer or producer for advice given.
             642          [(89)] (90) "Insurance holding company system" means a group of two or more
             643      affiliated persons, at least one of whom is an insurer.
             644          [(90)] (91) (a) "Insurance producer" or "producer" means a person licensed or required
             645      to be licensed under the laws of this state to sell, solicit, or negotiate insurance.


             646          (b) (i) "Producer for the insurer" means a producer who is compensated directly or
             647      indirectly by an insurer for selling, soliciting, or negotiating an insurance product of that
             648      insurer.
             649          (ii) "Producer for the insurer" may be referred to as an "agent."
             650          (c) (i) "Producer for the insured" means a producer who:
             651          (A) is compensated directly and only by an insurance customer or an insured; and
             652          (B) receives no compensation directly or indirectly from an insurer for selling,
             653      soliciting, or negotiating an insurance product of that insurer to an insurance customer or
             654      insured.
             655          (ii) "Producer for the insured" may be referred to as a "broker."
             656          [(91)] (92) (a) "Insured" means a person to whom or for whose benefit an insurer
             657      makes a promise in an insurance policy and includes:
             658          (i) a policyholder;
             659          (ii) a subscriber;
             660          (iii) a member; and
             661          (iv) a beneficiary.
             662          (b) The definition in Subsection [(91)] (92)(a):
             663          (i) applies only to this title; and
             664          (ii) does not define the meaning of this word as used in an insurance policy or
             665      certificate.
             666          [(92)] (93) (a) "Insurer" means a person doing an insurance business as a principal
             667      including:
             668          (i) a fraternal benefit society;
             669          (ii) an issuer of a gift annuity other than an annuity specified in Subsections
             670      31A-22-1305 (2) and (3);
             671          (iii) a motor club;
             672          (iv) an employee welfare plan; and
             673          (v) a person purporting or intending to do an insurance business as a principal on that


             674      person's own account.
             675          (b) "Insurer" does not include a governmental entity to the extent the governmental
             676      entity is engaged in an activity described in Section 31A-12-107 .
             677          [(93)] (94) "Interinsurance exchange" is defined in Subsection [(144)] (145).
             678          [(94)] (95) "Involuntary unemployment insurance" means insurance:
             679          (a) offered in connection with an extension of credit; and
             680          (b) that provides indemnity if the debtor is involuntarily unemployed for payments
             681      coming due on a:
             682          (i) specific loan; or
             683          (ii) credit transaction.
             684          [(95)] (96) "Large employer," in connection with a health benefit plan, means an
             685      employer who, with respect to a calendar year and to a plan year:
             686          (a) employed an average of at least 51 eligible employees on each business day during
             687      the preceding calendar year; and
             688          (b) employs at least two employees on the first day of the plan year.
             689          [(96)] (97) "Late enrollee," with respect to an employer health benefit plan, means an
             690      individual whose enrollment is a late enrollment.
             691          [(97)] (98) "Late enrollment," with respect to an employer health benefit plan, means
             692      enrollment of an individual other than:
             693          (a) on the earliest date on which coverage can become effective for the individual
             694      under the terms of the plan; or
             695          (b) through special enrollment.
             696          [(98)] (99) (a) Except for a retainer contract or legal assistance described in Section
             697      31A-1-103 , "legal expense insurance" means insurance written to indemnify or pay for a
             698      specified legal expense.
             699          (b) "Legal expense insurance" includes an arrangement that creates a reasonable
             700      expectation of an enforceable right.
             701          (c) "Legal expense insurance" does not include the provision of, or reimbursement for,


             702      legal services incidental to other insurance coverage.
             703          [(99)] (100) (a) "Liability insurance" means insurance against liability:
             704          (i) for death, injury, or disability of a human being, or for damage to property,
             705      exclusive of the coverages under:
             706          (A) Subsection [(109)] (110) for medical malpractice insurance;
             707          (B) Subsection [(136)] (137) for professional liability insurance; and
             708          (C) Subsection [(170)] (171) for workers' compensation insurance;
             709          (ii) for a medical, hospital, surgical, and funeral benefit to a person other than the
             710      insured who is injured, irrespective of legal liability of the insured, when issued with or
             711      supplemental to insurance against legal liability for the death, injury, or disability of a human
             712      being, exclusive of the coverages under:
             713          (A) Subsection [(109)] (110) for medical malpractice insurance;
             714          (B) Subsection [(136)] (137) for professional liability insurance; and
             715          (C) Subsection [(170)] (171) for workers' compensation insurance;
             716          (iii) for loss or damage to property resulting from an accident to or explosion of a
             717      boiler, pipe, pressure container, machinery, or apparatus;
             718          (iv) for loss or damage to property caused by:
             719          (A) the breakage or leakage of a sprinkler, water pipe, or water container; or
             720          (B) water entering through a leak or opening in a building; or
             721          (v) for other loss or damage properly the subject of insurance not within another kind
             722      of insurance as defined in this chapter, if the insurance is not contrary to law or public policy.
             723          (b) "Liability insurance" includes:
             724          (i) vehicle liability insurance;
             725          (ii) residential dwelling liability insurance; and
             726          (iii) making inspection of, and issuing a certificate of inspection upon, an elevator,
             727      boiler, machinery, or apparatus of any kind when done in connection with insurance on the
             728      elevator, boiler, machinery, or apparatus.
             729          [(100)] (101) (a) "License" means authorization issued by the commissioner to engage


             730      in an activity that is part of or related to the insurance business.
             731          (b) "License" includes a certificate of authority issued to an insurer.
             732          [(101)] (102) (a) "Life insurance" means:
             733          (i) insurance on a human life; and
             734          (ii) insurance pertaining to or connected with human life.
             735          (b) The business of life insurance includes:
             736          (i) granting a death benefit;
             737          (ii) granting an annuity benefit;
             738          (iii) granting an endowment benefit;
             739          (iv) granting an additional benefit in the event of death by accident;
             740          (v) granting an additional benefit to safeguard the policy against lapse; and
             741          (vi) providing an optional method of settlement of proceeds.
             742          [(102)] (103) "Limited license" means a license that:
             743          (a) is issued for a specific product of insurance; and
             744          (b) limits an individual or agency to transact only for that product or insurance.
             745          [(103)] (104) "Limited line credit insurance" includes the following forms of
             746      insurance:
             747          (a) credit life;
             748          (b) credit accident and health;
             749          (c) credit property;
             750          (d) credit unemployment;
             751          (e) involuntary unemployment;
             752          (f) mortgage life;
             753          (g) mortgage guaranty;
             754          (h) mortgage accident and health;
             755          (i) guaranteed automobile protection; and
             756          (j) another form of insurance offered in connection with an extension of credit that:
             757          (i) is limited to partially or wholly extinguishing the credit obligation; and


             758          (ii) the commissioner determines by rule should be designated as a form of limited line
             759      credit insurance.
             760          [(104)] (105) "Limited line credit insurance producer" means a person who sells,
             761      solicits, or negotiates one or more forms of limited line credit insurance coverage to an
             762      individual through a master, corporate, group, or individual policy.
             763          [(105)] (106) "Limited line insurance" includes:
             764          (a) bail bond;
             765          (b) limited line credit insurance;
             766          (c) legal expense insurance;
             767          (d) motor club insurance;
             768          (e) car rental related insurance;
             769          (f) travel insurance;
             770          (g) crop insurance;
             771          (h) self-service storage insurance;
             772          (i) guaranteed asset protection waiver; and
             773          (j) another form of limited insurance that the commissioner determines by rule should
             774      be designated a form of limited line insurance.
             775          [(106)] (107) "Limited lines authority" includes:
             776          (a) the lines of insurance listed in Subsection [(105)] (106); and
             777          (b) a customer service representative.
             778          [(107)] (108) "Limited lines producer" means a person who sells, solicits, or negotiates
             779      limited lines insurance.
             780          [(108)] (109) (a) "Long-term care insurance" means an insurance policy or rider
             781      advertised, marketed, offered, or designated to provide coverage:
             782          (i) in a setting other than an acute care unit of a hospital;
             783          (ii) for not less than 12 consecutive months for a covered person on the basis of:
             784          (A) expenses incurred;
             785          (B) indemnity;


             786          (C) prepayment; or
             787          (D) another method;
             788          (iii) for one or more necessary or medically necessary services that are:
             789          (A) diagnostic;
             790          (B) preventative;
             791          (C) therapeutic;
             792          (D) rehabilitative;
             793          (E) maintenance; or
             794          (F) personal care; and
             795          (iv) that may be issued by:
             796          (A) an insurer;
             797          (B) a fraternal benefit society;
             798          (C) (I) a nonprofit health hospital; and
             799          (II) a medical service corporation;
             800          (D) a prepaid health plan;
             801          (E) a health maintenance organization; or
             802          (F) an entity similar to the entities described in Subsections [(108)] (109)(a)(iv)(A)
             803      through (E) to the extent that the entity is otherwise authorized to issue life or health care
             804      insurance.
             805          (b) "Long-term care insurance" includes:
             806          (i) any of the following that provide directly or supplement long-term care insurance:
             807          (A) a group or individual annuity or rider; or
             808          (B) a life insurance policy or rider;
             809          (ii) a policy or rider that provides for payment of benefits on the basis of:
             810          (A) cognitive impairment; or
             811          (B) functional capacity; or
             812          (iii) a qualified long-term care insurance contract.
             813          (c) "Long-term care insurance" does not include:


             814          (i) a policy that is offered primarily to provide basic Medicare supplement coverage;
             815          (ii) basic hospital expense coverage;
             816          (iii) basic medical/surgical expense coverage;
             817          (iv) hospital confinement indemnity coverage;
             818          (v) major medical expense coverage;
             819          (vi) income replacement or related asset-protection coverage;
             820          (vii) accident only coverage;
             821          (viii) coverage for a specified:
             822          (A) disease; or
             823          (B) accident;
             824          (ix) limited benefit health coverage; or
             825          (x) a life insurance policy that accelerates the death benefit to provide the option of a
             826      lump sum payment:
             827          (A) if the following are not conditioned on the receipt of long-term care:
             828          (I) benefits; or
             829          (II) eligibility; and
             830          (B) the coverage is for one or more the following qualifying events:
             831          (I) terminal illness;
             832          (II) medical conditions requiring extraordinary medical intervention; or
             833          (III) permanent institutional confinement.
             834          [(109)] (110) "Medical malpractice insurance" means insurance against legal liability
             835      incident to the practice and provision of a medical service other than the practice and provision
             836      of a dental service.
             837          [(110)] (111) "Member" means a person having membership rights in an insurance
             838      corporation.
             839          [(111)] (112) "Minimum capital" or "minimum required capital" means the capital that
             840      must be constantly maintained by a stock insurance corporation as required by statute.
             841          [(112)] (113) "Mortgage accident and health insurance" means insurance offered in


             842      connection with an extension of credit that provides indemnity for payments coming due on a
             843      mortgage while the debtor has a disability.
             844          [(113)] (114) "Mortgage guaranty insurance" means surety insurance under which a
             845      mortgagee or other creditor is indemnified against losses caused by the default of a debtor.
             846          [(114)] (115) "Mortgage life insurance" means insurance on the life of a debtor in
             847      connection with an extension of credit that pays if the debtor dies.
             848          [(115)] (116) "Motor club" means a person:
             849          (a) licensed under:
             850          (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
             851          (ii) Chapter 11, Motor Clubs; or
             852          (iii) Chapter 14, Foreign Insurers; and
             853          (b) that promises for an advance consideration to provide for a stated period of time
             854      one or more:
             855          (i) legal services under Subsection 31A-11-102 (1)(b);
             856          (ii) bail services under Subsection 31A-11-102 (1)(c); or
             857          (iii) (A) trip reimbursement;
             858          (B) towing services;
             859          (C) emergency road services;
             860          (D) stolen automobile services;
             861          (E) a combination of the services listed in Subsections [(115)] (116)(b)(iii)(A) through
             862      (D); or
             863          (F) other services given in Subsections 31A-11-102 (1)(b) through (f).
             864          [(116)] (117) "Mutual" means a mutual insurance corporation.
             865          [(117)] (118) "Network plan" means health care insurance:
             866          (a) that is issued by an insurer; and
             867          (b) under which the financing and delivery of medical care is provided, in whole or in
             868      part, through a defined set of providers under contract with the insurer, including the financing
             869      and delivery of an item paid for as medical care.


             870          [(118)] (119) "Nonparticipating" means a plan of insurance under which the insured is
             871      not entitled to receive a dividend representing a share of the surplus of the insurer.
             872          [(119)] (120) "Ocean marine insurance" means insurance against loss of or damage to:
             873          (a) ships or hulls of ships;
             874          (b) goods, freight, cargoes, merchandise, effects, disbursements, profits, money,
             875      securities, choses in action, evidences of debt, valuable papers, bottomry, respondentia
             876      interests, or other cargoes in or awaiting transit over the oceans or inland waterways;
             877          (c) earnings such as freight, passage money, commissions, or profits derived from
             878      transporting goods or people upon or across the oceans or inland waterways; or
             879          (d) a vessel owner or operator as a result of liability to employees, passengers, bailors,
             880      owners of other vessels, owners of fixed objects, customs or other authorities, or other persons
             881      in connection with maritime activity.
             882          [(120)] (121) "Order" means an order of the commissioner.
             883          [(121)] (122) "Outline of coverage" means a summary that explains an accident and
             884      health insurance policy.
             885          [(122)] (123) "Participating" means a plan of insurance under which the insured is
             886      entitled to receive a dividend representing a share of the surplus of the insurer.
             887          [(123)] (124) "Participation," as used in a health benefit plan, means a requirement
             888      relating to the minimum percentage of eligible employees that must be enrolled in relation to
             889      the total number of eligible employees of an employer reduced by each eligible employee who
             890      voluntarily declines coverage under the plan because the employee:
             891          (a) has other group health care insurance coverage; or
             892          (b) receives:
             893          (i) Medicare, under the Health Insurance for the Aged Act, Title XVIII of the Social
             894      Security Amendments of 1965; or
             895          (ii) another government health benefit.
             896          [(124)] (125) "Person" includes:
             897          (a) an individual;


             898          (b) a partnership;
             899          (c) a corporation;
             900          (d) an incorporated or unincorporated association;
             901          (e) a joint stock company;
             902          (f) a trust;
             903          (g) a limited liability company;
             904          (h) a reciprocal;
             905          (i) a syndicate; or
             906          (j) another similar entity or combination of entities acting in concert.
             907          [(125)] (126) "Personal lines insurance" means property and casualty insurance
             908      coverage sold for primarily noncommercial purposes to:
             909          (a) an individual; or
             910          (b) a family.
             911          [(126)] (127) "Plan sponsor" is as defined in 29 U.S.C. Sec. 1002(16)(B).
             912          [(127)] (128) "Plan year" means:
             913          (a) the year that is designated as the plan year in:
             914          (i) the plan document of a group health plan; or
             915          (ii) a summary plan description of a group health plan;
             916          (b) if the plan document or summary plan description does not designate a plan year or
             917      there is no plan document or summary plan description:
             918          (i) the year used to determine deductibles or limits;
             919          (ii) the policy year, if the plan does not impose deductibles or limits on a yearly basis;
             920      or
             921          (iii) the employer's taxable year if:
             922          (A) the plan does not impose deductibles or limits on a yearly basis; and
             923          (B) (I) the plan is not insured; or
             924          (II) the insurance policy is not renewed on an annual basis; or
             925          (c) in a case not described in Subsection [(127)] (128)(a) or (b), the calendar year.


             926          [(128)] (129) (a) "Policy" means a document, including an attached endorsement or
             927      application that:
             928          (i) purports to be an enforceable contract; and
             929          (ii) memorializes in writing some or all of the terms of an insurance contract.
             930          (b) "Policy" includes a service contract issued by:
             931          (i) a motor club under Chapter 11, Motor Clubs;
             932          (ii) a service contract provided under Chapter 6a, Service Contracts; and
             933          (iii) a corporation licensed under:
             934          (A) Chapter 7, Nonprofit Health Service Insurance Corporations; or
             935          (B) Chapter 8, Health Maintenance Organizations and Limited Health Plans.
             936          (c) "Policy" does not include:
             937          (i) a certificate under a group insurance contract; or
             938          (ii) a document that does not purport to have legal effect.
             939          [(129)] (130) "Policyholder" means a person who controls a policy, binder, or oral
             940      contract by ownership, premium payment, or otherwise.
             941          [(130)] (131) "Policy illustration" means a presentation or depiction that includes
             942      nonguaranteed elements of a policy of life insurance over a period of years.
             943          [(131)] (132) "Policy summary" means a synopsis describing the elements of a life
             944      insurance policy.
             945          [(132)] (133) "Preexisting condition," with respect to a health benefit plan:
             946          (a) means a condition that was present before the effective date of coverage, whether or
             947      not medical advice, diagnosis, care, or treatment was recommended or received before that day;
             948      and
             949          (b) does not include a condition indicated by genetic information unless an actual
             950      diagnosis of the condition by a physician has been made.
             951          [(133)] (134) (a) "Premium" means the monetary consideration for an insurance policy.
             952          (b) "Premium" includes, however designated:
             953          (i) an assessment;


             954          (ii) a membership fee;
             955          (iii) a required contribution; or
             956          (iv) monetary consideration.
             957          (c) (i) "Premium" does not include consideration paid to a third party administrator for
             958      the third party administrator's services.
             959          (ii) "Premium" includes an amount paid by a third party administrator to an insurer for
             960      insurance on the risks administered by the third party administrator.
             961          [(134)] (135) "Principal officers" for a corporation means the officers designated under
             962      Subsection 31A-5-203 (3).
             963          [(135)] (136) "Proceeding" includes an action or special statutory proceeding.
             964          [(136)] (137) "Professional liability insurance" means insurance against legal liability
             965      incident to the practice of a profession and provision of a professional service.
             966          [(137)] (138) (a) Except as provided in Subsection [(137)] (138)(b), "property
             967      insurance" means insurance against loss or damage to real or personal property of every kind
             968      and any interest in that property:
             969          (i) from all hazards or causes; and
             970          (ii) against loss consequential upon the loss or damage including vehicle
             971      comprehensive and vehicle physical damage coverages.
             972          (b) "Property insurance" does not include:
             973          (i) inland marine insurance; and
             974          (ii) ocean marine insurance.
             975          [(138)] (139) "Qualified long-term care insurance contract" or "federally tax qualified
             976      long-term care insurance contract" means:
             977          (a) an individual or group insurance contract that meets the requirements of Section
             978      7702B(b), Internal Revenue Code; or
             979          (b) the portion of a life insurance contract that provides long-term care insurance:
             980          (i) (A) by rider; or
             981          (B) as a part of the contract; and


             982          (ii) that satisfies the requirements of Sections 7702B(b) and (e), Internal Revenue
             983      Code.
             984          [(139)] (140) "Qualified United States financial institution" means an institution that:
             985          (a) is:
             986          (i) organized under the laws of the United States or any state; or
             987          (ii) in the case of a United States office of a foreign banking organization, licensed
             988      under the laws of the United States or any state;
             989          (b) is regulated, supervised, and examined by a United States federal or state authority
             990      having regulatory authority over a bank or trust company; and
             991          (c) meets the standards of financial condition and standing that are considered
             992      necessary and appropriate to regulate the quality of a financial institution whose letters of credit
             993      will be acceptable to the commissioner as determined by:
             994          (i) the commissioner by rule; or
             995          (ii) the Securities Valuation Office of the National Association of Insurance
             996      Commissioners.
             997          [(140)] (141) (a) "Rate" means:
             998          (i) the cost of a given unit of insurance; or
             999          (ii) for property or casualty insurance, that cost of insurance per exposure unit either
             1000      expressed as:
             1001          (A) a single number; or
             1002          (B) a pure premium rate, adjusted before the application of individual risk variations
             1003      based on loss or expense considerations to account for the treatment of:
             1004          (I) expenses;
             1005          (II) profit; and
             1006          (III) individual insurer variation in loss experience.
             1007          (b) "Rate" does not include a minimum premium.
             1008          [(141)] (142) (a) Except as provided in Subsection [(141)] (142)(b), "rate service
             1009      organization" means a person who assists an insurer in rate making or filing by:


             1010          (i) collecting, compiling, and furnishing loss or expense statistics;
             1011          (ii) recommending, making, or filing rates or supplementary rate information; or
             1012          (iii) advising about rate questions, except as an attorney giving legal advice.
             1013          (b) "Rate service organization" does not mean:
             1014          (i) an employee of an insurer;
             1015          (ii) a single insurer or group of insurers under common control;
             1016          (iii) a joint underwriting group; or
             1017          (iv) an individual serving as an actuarial or legal consultant.
             1018          [(142)] (143) "Rating manual" means any of the following used to determine initial and
             1019      renewal policy premiums:
             1020          (a) a manual of rates;
             1021          (b) a classification;
             1022          (c) a rate-related underwriting rule; and
             1023          (d) a rating formula that describes steps, policies, and procedures for determining
             1024      initial and renewal policy premiums.
             1025          [(143)] (144) "Received by the department" means:
             1026          (a) the date delivered to and stamped received by the department, if delivered in
             1027      person;
             1028          (b) the post mark date, if delivered by mail;
             1029          (c) the delivery service's post mark or pickup date, if delivered by a delivery service;
             1030          (d) the received date recorded on an item delivered, if delivered by:
             1031          (i) facsimile;
             1032          (ii) email; or
             1033          (iii) another electronic method; or
             1034          (e) a date specified in:
             1035          (i) a statute;
             1036          (ii) a rule; or
             1037          (iii) an order.


             1038          [(144)] (145) "Reciprocal" or "interinsurance exchange" means an unincorporated
             1039      association of persons:
             1040          (a) operating through an attorney-in-fact common to all of the persons; and
             1041          (b) exchanging insurance contracts with one another that provide insurance coverage
             1042      on each other.
             1043          [(145)] (146) "Reinsurance" means an insurance transaction where an insurer, for
             1044      consideration, transfers any portion of the risk it has assumed to another insurer. In referring to
             1045      reinsurance transactions, this title sometimes refers to:
             1046          (a) the insurer transferring the risk as the "ceding insurer"; and
             1047          (b) the insurer assuming the risk as the:
             1048          (i) "assuming insurer"; or
             1049          (ii) "assuming reinsurer."
             1050          [(146)] (147) "Reinsurer" means a person licensed in this state as an insurer with the
             1051      authority to assume reinsurance.
             1052          [(147)] (148) "Residential dwelling liability insurance" means insurance against
             1053      liability resulting from or incident to the ownership, maintenance, or use of a residential
             1054      dwelling that is a detached single family residence or multifamily residence up to four units.
             1055          [(148)] (149) (a) "Retrocession" means reinsurance with another insurer of a liability
             1056      assumed under a reinsurance contract.
             1057          (b) A reinsurer "retrocedes" when the reinsurer reinsures with another insurer part of a
             1058      liability assumed under a reinsurance contract.
             1059          [(149)] (150) "Rider" means an endorsement to:
             1060          (a) an insurance policy; or
             1061          (b) an insurance certificate.
             1062          [(150)] (151) (a) "Security" means a:
             1063          (i) note;
             1064          (ii) stock;
             1065          (iii) bond;


             1066          (iv) debenture;
             1067          (v) evidence of indebtedness;
             1068          (vi) certificate of interest or participation in a profit-sharing agreement;
             1069          (vii) collateral-trust certificate;
             1070          (viii) preorganization certificate or subscription;
             1071          (ix) transferable share;
             1072          (x) investment contract;
             1073          (xi) voting trust certificate;
             1074          (xii) certificate of deposit for a security;
             1075          (xiii) certificate of interest of participation in an oil, gas, or mining title or lease or in
             1076      payments out of production under such a title or lease;
             1077          (xiv) commodity contract or commodity option;
             1078          (xv) certificate of interest or participation in, temporary or interim certificate for,
             1079      receipt for, guarantee of, or warrant or right to subscribe to or purchase any of the items listed
             1080      in Subsections [(150)] (151)(a)(i) through (xiv); or
             1081          (xvi) another interest or instrument commonly known as a security.
             1082          (b) "Security" does not include:
             1083          (i) any of the following under which an insurance company promises to pay money in a
             1084      specific lump sum or periodically for life or some other specified period:
             1085          (A) insurance;
             1086          (B) an endowment policy; or
             1087          (C) an annuity contract; or
             1088          (ii) a burial certificate or burial contract.
             1089          [(151)] (152) "Secondary medical condition" means a complication related to an
             1090      exclusion from coverage in accident and health insurance.
             1091          [(152)] (153) (a) "Self-insurance" means an arrangement under which a person
             1092      provides for spreading its own risks by a systematic plan.
             1093          (b) Except as provided in this Subsection [(152)] (153), "self-insurance" does not


             1094      include an arrangement under which a number of persons spread their risks among themselves.
             1095          (c) "Self-insurance" includes:
             1096          (i) an arrangement by which a governmental entity undertakes to indemnify an
             1097      employee for liability arising out of the employee's employment; and
             1098          (ii) an arrangement by which a person with a managed program of self-insurance and
             1099      risk management undertakes to indemnify its affiliates, subsidiaries, directors, officers, or
             1100      employees for liability or risk that is related to the relationship or employment.
             1101          (d) "Self-insurance" does not include an arrangement with an independent contractor.
             1102          [(153)] (154) "Sell" means to exchange a contract of insurance:
             1103          (a) by any means;
             1104          (b) for money or its equivalent; and
             1105          (c) on behalf of an insurance company.
             1106          [(154)] (155) "Short-term care insurance" means an insurance policy or rider
             1107      advertised, marketed, offered, or designed to provide coverage that is similar to long-term care
             1108      insurance, but that provides coverage for less than 12 consecutive months for each covered
             1109      person.
             1110          [(155)] (156) "Significant break in coverage" means a period of 63 consecutive days
             1111      during each of which an individual does not have creditable coverage.
             1112          [(156)] (157) "Small employer," in connection with a health benefit plan, means an
             1113      employer who, with respect to a calendar year and to a plan year:
             1114          (a) employed an average of at least two employees but not more than 50 eligible
             1115      employees on each business day during the preceding calendar year; and
             1116          (b) employs at least two employees on the first day of the plan year.
             1117          [(157)] (158) "Special enrollment period," in connection with a health benefit plan, has
             1118      the same meaning as provided in federal regulations adopted pursuant to the Health Insurance
             1119      Portability and Accountability Act.
             1120          [(158)] (159) (a) "Subsidiary" of a person means an affiliate controlled by that person
             1121      either directly or indirectly through one or more affiliates or intermediaries.


             1122          (b) "Wholly owned subsidiary" of a person is a subsidiary of which all of the voting
             1123      shares are owned by that person either alone or with its affiliates, except for the minimum
             1124      number of shares the law of the subsidiary's domicile requires to be owned by directors or
             1125      others.
             1126          [(159)] (160) Subject to Subsection [(85)] (86)(b), "surety insurance" includes:
             1127          (a) a guarantee against loss or damage resulting from the failure of a principal to pay or
             1128      perform the principal's obligations to a creditor or other obligee;
             1129          (b) bail bond insurance; and
             1130          (c) fidelity insurance.
             1131          [(160)] (161) (a) "Surplus" means the excess of assets over the sum of paid-in capital
             1132      and liabilities.
             1133          (b) (i) "Permanent surplus" means the surplus of a mutual insurer that is designated by
             1134      the insurer as permanent.
             1135          (ii) Sections 31A-5-211 , 31A-7-201 , 31A-8-209 , 31A-9-209 , and 31A-14-209 require
             1136      that mutuals doing business in this state maintain specified minimum levels of permanent
             1137      surplus.
             1138          (iii) Except for assessable mutuals, the minimum permanent surplus requirement is the
             1139      same as the minimum required capital requirement that applies to stock insurers.
             1140          (c) "Excess surplus" means:
             1141          (i) for a life insurer, accident and health insurer, health organization, or property and
             1142      casualty insurer as defined in Section 31A-17-601 , the lesser of:
             1143          (A) that amount of an insurer's or health organization's total adjusted capital that
             1144      exceeds the product of:
             1145          (I) 2.5; and
             1146          (II) the sum of the insurer's or health organization's minimum capital or permanent
             1147      surplus required under Section 31A-5-211 , 31A-9-209 , or 31A-14-205 ; or
             1148          (B) that amount of an insurer's or health organization's total adjusted capital that
             1149      exceeds the product of:


             1150          (I) 3.0; and
             1151          (II) the authorized control level RBC as defined in Subsection 31A-17-601 (8)(a); and
             1152          (ii) for a monoline mortgage guaranty insurer, financial guaranty insurer, or title insurer
             1153      that amount of an insurer's paid-in-capital and surplus that exceeds the product of:
             1154          (A) 1.5; and
             1155          (B) the insurer's total adjusted capital required by Subsection 31A-17-609 (1).
             1156          [(161)] (162) "Third party administrator" or "administrator" means a person who
             1157      collects charges or premiums from, or who, for consideration, adjusts or settles claims of
             1158      residents of the state in connection with insurance coverage, annuities, or service insurance
             1159      coverage, except:
             1160          (a) a union on behalf of its members;
             1161          (b) a person administering a:
             1162          (i) pension plan subject to the federal Employee Retirement Income Security Act of
             1163      1974;
             1164          (ii) governmental plan as defined in Section 414(d), Internal Revenue Code; or
             1165          (iii) nonelecting church plan as described in Section 410(d), Internal Revenue Code;
             1166          (c) an employer on behalf of the employer's employees or the employees of one or
             1167      more of the subsidiary or affiliated corporations of the employer;
             1168          (d) an insurer licensed under the following, but only for a line of insurance for which
             1169      the insurer holds a license in this state:
             1170          (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
             1171          (ii) Chapter 7, Nonprofit Health Service Insurance Corporations;
             1172          (iii) Chapter 8, Health Maintenance Organizations and Limited Health Plans;
             1173          (iv) Chapter 9, Insurance Fraternals; or
             1174          (v) Chapter 14, Foreign Insurers; [or]
             1175          (e) a person:
             1176          (i) licensed or exempt from licensing under:
             1177          (A) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and


             1178      Reinsurance Intermediaries; or
             1179          (B) Chapter 26, Insurance Adjusters; and
             1180          (ii) whose activities are limited to those authorized under the license the person holds
             1181      or for which the person is exempt[.]; or
             1182          (f) an institution, bank, or financial institution:
             1183          (i) that is:
             1184          (A) an institution whose deposits and accounts are to any extent insured by a federal
             1185      deposit insurance agency, including the Federal Deposit Insurance Corporation or National
             1186      Credit Union Administration; or
             1187          (B) a bank or other financial institution that is subject to supervision or examination by
             1188      a federal or state banking authority; and
             1189          (ii) that does not adjust claims without a third party administrator license.
             1190          [(162)] (163) "Title insurance" means the insuring, guaranteeing, or indemnifying of an
             1191      owner of real or personal property or the holder of liens or encumbrances on that property, or
             1192      others interested in the property against loss or damage suffered by reason of liens or
             1193      encumbrances upon, defects in, or the unmarketability of the title to the property, or invalidity
             1194      or unenforceability of any liens or encumbrances on the property.
             1195          [(163)] (164) "Total adjusted capital" means the sum of an insurer's or health
             1196      organization's statutory capital and surplus as determined in accordance with:
             1197          (a) the statutory accounting applicable to the annual financial statements required to be
             1198      filed under Section 31A-4-113 ; and
             1199          (b) another item provided by the RBC instructions, as RBC instructions is defined in
             1200      Section 31A-17-601 .
             1201          [(164)] (165) (a) "Trustee" means "director" when referring to the board of directors of
             1202      a corporation.
             1203          (b) "Trustee," when used in reference to an employee welfare fund, means an
             1204      individual, firm, association, organization, joint stock company, or corporation, whether acting
             1205      individually or jointly and whether designated by that name or any other, that is charged with


             1206      or has the overall management of an employee welfare fund.
             1207          [(165)] (166) (a) "Unauthorized insurer," "unadmitted insurer," or "nonadmitted
             1208      insurer" means an insurer:
             1209          (i) not holding a valid certificate of authority to do an insurance business in this state;
             1210      or
             1211          (ii) transacting business not authorized by a valid certificate.
             1212          (b) "Admitted insurer" or "authorized insurer" means an insurer:
             1213          (i) holding a valid certificate of authority to do an insurance business in this state; and
             1214          (ii) transacting business as authorized by a valid certificate.
             1215          [(166)] (167) "Underwrite" means the authority to accept or reject risk on behalf of the
             1216      insurer.
             1217          [(167)] (168) "Vehicle liability insurance" means insurance against liability resulting
             1218      from or incident to ownership, maintenance, or use of a land vehicle or aircraft, exclusive of a
             1219      vehicle comprehensive or vehicle physical damage coverage under Subsection [(137)] (138).
             1220          [(168)] (169) "Voting security" means a security with voting rights, and includes a
             1221      security convertible into a security with a voting right associated with the security.
             1222          [(169)] (170) "Waiting period" for a health benefit plan means the period that must
             1223      pass before coverage for an individual, who is otherwise eligible to enroll under the terms of
             1224      the health benefit plan, can become effective.
             1225          [(170)] (171) "Workers' compensation insurance" means:
             1226          (a) insurance for indemnification of an employer against liability for compensation
             1227      based on:
             1228          (i) a compensable accidental injury; and
             1229          (ii) occupational disease disability;
             1230          (b) employer's liability insurance incidental to workers' compensation insurance and
             1231      written in connection with workers' compensation insurance; and
             1232          (c) insurance assuring to a person entitled to workers' compensation benefits the
             1233      compensation provided by law.


             1234          Section 2. Section 31A-2-308 is amended to read:
             1235           31A-2-308. Enforcement penalties and procedures.
             1236          (1) (a) A person who violates any insurance statute or rule or any order issued under
             1237      Subsection 31A-2-201 (4) shall forfeit to the state twice the amount of any profit gained from
             1238      the violation, in addition to any other forfeiture or penalty imposed.
             1239          (b) (i) The commissioner may order an individual producer, surplus line producer,
             1240      limited line producer, [customer service representative,] managing general agent, reinsurance
             1241      intermediary, adjuster, or insurance consultant who violates an insurance statute or rule to
             1242      forfeit to the state not more than $2,500 for each violation.
             1243          (ii) The commissioner may order any other person who violates an insurance statute or
             1244      rule to forfeit to the state not more than $5,000 for each violation.
             1245          (c) (i) The commissioner may order an individual producer, surplus line producer,
             1246      limited line producer, [customer service representative,] managing general agent, reinsurance
             1247      intermediary, adjuster, or insurance consultant who violates an order issued under Subsection
             1248      31A-2-201 (4) to forfeit to the state not more than $2,500 for each violation. Each day the
             1249      violation continues is a separate violation.
             1250          (ii) The commissioner may order any other person who violates an order issued under
             1251      Subsection 31A-2-201 (4) to forfeit to the state not more than $5,000 for each violation. Each
             1252      day the violation continues is a separate violation.
             1253          (d) The commissioner may accept or compromise any forfeiture under this Subsection
             1254      (1) until after a complaint is filed under Subsection (2). After the filing of the complaint, only
             1255      the attorney general may compromise the forfeiture.
             1256          (2) When a person fails to comply with an order issued under Subsection
             1257      31A-2-201 (4), including a forfeiture order, the commissioner may file an action in any court of
             1258      competent jurisdiction or obtain a court order or judgment:
             1259          (a) enforcing the commissioner's order;
             1260          (b) (i) directing compliance with the commissioner's order and restraining further
             1261      violation of the order; and


             1262          (ii) subjecting the person ordered to the procedures and sanctions available to the court
             1263      for punishing contempt if the failure to comply continues; or
             1264          (c) imposing a forfeiture in an amount the court considers just, up to $10,000 for each
             1265      day the failure to comply continues after the filing of the complaint until judgment is rendered.
             1266          (3) (a) The Utah Rules of Civil Procedure govern actions brought under Subsection (2),
             1267      except that the commissioner may file a complaint seeking a court-ordered forfeiture under
             1268      Subsection (2)(c) no sooner than two weeks after giving written notice of the commissioner's
             1269      intention to proceed under Subsection (2)(c).
             1270          (b) The commissioner's order issued under Subsection 31A-2-201 (4) may contain a
             1271      notice of intention to seek a court-ordered forfeiture if the commissioner's order is disobeyed.
             1272          (4) If, after a court order is issued under Subsection (2), the person fails to comply with
             1273      the commissioner's order or judgment:
             1274          (a) the commissioner may certify the fact of the failure to the court by affidavit; and
             1275          (b) the court may, after a hearing following at least five days written notice to the
             1276      parties subject to the order or judgment, amend the order or judgment to add the forfeiture or
             1277      forfeitures, as prescribed in Subsection (2)(c), until the person complies.
             1278          (5) (a) The proceeds of [all] the forfeitures under this section, including collection
             1279      expenses, shall be paid into the General Fund.
             1280          (b) The expenses of collection shall be credited to the department's budget.
             1281          (c) The attorney general's budget shall be credited to the extent the department
             1282      reimburses the attorney general's office for its collection expenses under this section.
             1283          (6) (a) Forfeitures and judgments under this section bear interest at the rate charged by
             1284      the United States Internal Revenue Service for past due taxes on the:
             1285          (i) date of entry of the commissioner's order under Subsection (1); or
             1286          (ii) date of judgment under Subsection (2).
             1287          (b) Interest accrues from the later of the dates described in Subsection (6)(a) until the
             1288      forfeiture and accrued interest are fully paid.
             1289          (7) A forfeiture may not be imposed under Subsection (2)(c) if:


             1290          (a) at the time the forfeiture action is commenced, the person was in compliance with
             1291      the commissioner's order; or
             1292          (b) the violation of the order occurred during the order's suspension.
             1293          (8) The commissioner may seek an injunction as an alternative to issuing an order
             1294      under Subsection 31A-2-201 (4).
             1295          (9) (a) A person is guilty of a class B misdemeanor if that person:
             1296          (i) intentionally violates:
             1297          (A) an insurance statute of this state; or
             1298          (B) an order issued under Subsection 31A-2-201 (4);
             1299          (ii) intentionally permits a person over whom that person has authority to violate:
             1300          (A) an insurance statute of this state; or
             1301          (B) an order issued under Subsection 31A-2-201 (4); or
             1302          (iii) intentionally aids any person in violating:
             1303          (A) an insurance statute of this state; or
             1304          (B) an order issued under Subsection 31A-2-201 (4).
             1305          (b) Unless a specific criminal penalty is provided elsewhere in this title, the person may
             1306      be fined not more than:
             1307          (i) $10,000 if a corporation; or
             1308          (ii) $5,000 if a person other than a corporation.
             1309          (c) If the person is an individual, the person may, in addition, be imprisoned for up to
             1310      one year.
             1311          (d) As used in this Subsection (9), "intentionally" has the same meaning as under
             1312      Subsection 76-2-103 (1).
             1313          (10) (a) A person who knowingly and intentionally violates Section 31A-4-102 ,
             1314      31A-8a-208 , 31A-15-105 , 31A-23a-116 , or 31A-31-111 is guilty of a felony as provided in this
             1315      Subsection (10).
             1316          (b) When the value of the property, money, or other things obtained or sought to be
             1317      obtained in violation of Subsection (10)(a):


             1318          (i) is less than $5,000, a person is guilty of a third degree felony; or
             1319          (ii) is or exceeds $5,000, a person is guilty of a second degree felony.
             1320          (11) (a) After a hearing, the commissioner may, in whole or in part, revoke, suspend,
             1321      place on probation, limit, or refuse to renew the licensee's license or certificate of authority:
             1322          (i) when a licensee of the department, other than a domestic insurer:
             1323          (A) persistently or substantially violates the insurance law; or
             1324          (B) violates an order of the commissioner under Subsection 31A-2-201 (4);
             1325          (ii) if there are grounds for delinquency proceedings against the licensee under Section
             1326      31A-27a-207 ; or
             1327          (iii) if the licensee's methods and practices in the conduct of the licensee's business
             1328      endanger, or the licensee's financial resources are inadequate to safeguard, the legitimate
             1329      interests of the licensee's customers and the public.
             1330          (b) Additional license termination or probation provisions for licensees other than
             1331      insurers are set forth in Sections 31A-19a-303 , 31A-19a-304 , 31A-23a-111 , 31A-23a-112 ,
             1332      31A-25-208 , 31A-25-209 , 31A-26-213 , 31A-26-214 , 31A-35-501 , and 31A-35-503 .
             1333          (12) The enforcement penalties and procedures set forth in this section are not
             1334      exclusive, but are cumulative of other rights and remedies the commissioner has pursuant to
             1335      applicable law.
             1336          Section 3. Section 31A-2-404 is amended to read:
             1337           31A-2-404. Duties of the commissioner and Title and Escrow Commission.
             1338          (1) Notwithstanding the other provisions of this chapter, to the extent provided in this
             1339      part, the commissioner shall administer and enforce the provisions in this title related to:
             1340          (a) title insurance; and
             1341          (b) escrow conducted by a title licensee or title insurer.
             1342          (2) The commission shall:
             1343          (a) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, and
             1344      subject to Subsection (3), make rules for the administration of the provisions in this title related
             1345      to title insurance including rules related to:


             1346          (i) rating standards and rating methods for a title licensee, as provided in Section
             1347      31A-19a-209 ;
             1348          (ii) the licensing for a title licensee, including the licensing requirements of [Sections
             1349      31A-23a-203 and ] Section 31A-23a-204 ;
             1350          (iii) continuing education requirements of Section 31A-23a-202 ;
             1351          (iv) examination procedures, after consultation with the commissioner and the
             1352      commissioner's test administrator when required by Section 31A-23a-204 ; and
             1353          (v) standards of conduct for a title licensee;
             1354          (b) concur in the issuance and renewal of a license in accordance with Section
             1355      31A-23a-105 or 31A-26-203 ;
             1356          (c) in accordance with Section 31A-3-103 , establish, with the concurrence of the
             1357      commissioner, the fees imposed by this title on a title licensee;
             1358          (d) in accordance with Section 31A-23a-415 determine, after consulting with the
             1359      commissioner, the assessment on a title insurer as defined in Section 31A-23a-415 ;
             1360          (e) conduct an administrative hearing not delegated by the commission to an
             1361      administrative law judge related to the:
             1362          (i) licensing of an applicant;
             1363          (ii) conduct of a title licensee; or
             1364          (iii) approval of a continuing education program required by Section 31A-23a-202 ;
             1365          (f) with the concurrence of the commissioner, approve a continuing education program
             1366      required by Section 31A-23a-202 ;
             1367          (g) with the concurrence of the commissioner, impose a penalty:
             1368          (i) under this title related to:
             1369          (A) title insurance; or
             1370          (B) escrow conducted by a title licensee;
             1371          (ii) after investigation by the commissioner in accordance with Part 3, Procedures and
             1372      Enforcement; and
             1373          (iii) that is enforced by the commissioner;


             1374          (h) advise the commissioner on the administration and enforcement of any matter
             1375      affecting the title insurance industry;
             1376          (i) advise the commissioner on matters affecting the commissioner's budget related to
             1377      title insurance; and
             1378          (j) perform other duties as provided in this title.
             1379          (3) The commission may make a rule under this title only if at the time the commission
             1380      files its proposed rule and rule analysis with the Division of Administrative Rules in
             1381      accordance with Section 63G-3-301 , the commission provides the Real Estate Commission that
             1382      same information.
             1383          (4) (a) The commissioner shall annually report the information described in Subsection
             1384      (4)(b) in writing to:
             1385          (i) the commission; and
             1386          (ii) the Business and Labor Interim Committee.
             1387          (b) The information required to be reported under this Subsection (4):
             1388          (i) may not identify a person; and
             1389          (ii) shall include:
             1390          (A) the number of complaints the commissioner receives with regard to transactions
             1391      involving title insurance or a title licensee during the calendar year immediately proceeding the
             1392      report;
             1393          (B) the type of complaints described in Subsection (4)(b)(ii)(A); and
             1394          (C) for each complaint described in Subsection (4)(b)(ii)(A):
             1395          (I) any action taken by the commissioner with regard to the complaint; and
             1396          (II) the time-period beginning the day on which a complaint is made and ending the
             1397      day on which the commissioner determines it will take no further action with regard to the
             1398      complaint.
             1399          Section 4. Section 31A-7-302 is amended to read:
             1400           31A-7-302. Annual report to policyholders.
             1401          Every insurer organized or operating under this chapter shall send to each policyholder


             1402      or electronically post on the insurer's public website an abbreviated annual report which
             1403      contains basic financial and operating data, and information about important business and
             1404      corporate developments.
             1405          Section 5. Section 31A-22-625 is amended to read:
             1406           31A-22-625. Catastrophic coverage of mental health conditions.
             1407          (1) As used in this section:
             1408          (a) (i) "Catastrophic mental health coverage" means coverage in a health benefit plan
             1409      that does not impose a lifetime limit, annual payment limit, episodic limit, inpatient or
             1410      outpatient service limit, or maximum out-of-pocket limit that places a greater financial burden
             1411      on an insured for the evaluation and treatment of a mental health condition than for the
             1412      evaluation and treatment of a physical health condition.
             1413          (ii) "Catastrophic mental health coverage" may include a restriction on cost sharing
             1414      factors, such as deductibles, copayments, or coinsurance, before reaching a maximum
             1415      out-of-pocket limit.
             1416          (iii) "Catastrophic mental health coverage" may include one maximum out-of-pocket
             1417      limit for physical health conditions and another maximum out-of-pocket limit for mental health
             1418      conditions, except that if separate out-of-pocket limits are established, the out-of-pocket limit
             1419      for mental health conditions may not exceed the out-of-pocket limit for physical health
             1420      conditions.
             1421          (b) (i) "50/50 mental health coverage" means coverage in a health benefit plan that
             1422      pays for at least 50% of covered services for the diagnosis and treatment of mental health
             1423      conditions.
             1424          (ii) "50/50 mental health coverage" may include a restriction on:
             1425          (A) episodic limits;
             1426          (B) inpatient or outpatient service limits; or
             1427          (C) maximum out-of-pocket limits.
             1428          (c) "Large employer" is as defined in 42 U.S.C. Sec. 300gg-91.
             1429          (d) (i) "Mental health condition" means a condition or disorder involving mental illness


             1430      that falls under a diagnostic category listed in the Diagnostic and Statistical Manual, as
             1431      periodically revised.
             1432          (ii) "Mental health condition" does not include the following when diagnosed as the
             1433      primary or substantial reason or need for treatment:
             1434          (A) a marital or family problem;
             1435          (B) a social, occupational, religious, or other social maladjustment;
             1436          (C) a conduct disorder;
             1437          (D) a chronic adjustment disorder;
             1438          (E) a psychosexual disorder;
             1439          (F) a chronic organic brain syndrome;
             1440          (G) a personality disorder;
             1441          (H) a specific developmental disorder or learning disability; or
             1442          (I) an intellectual disability.
             1443          (e) "Small employer" is as defined in 42 U.S.C. Sec. 300gg-91.
             1444          (2) (a) At the time of purchase and renewal, an insurer shall offer to a small employer
             1445      that it insures or seeks to insure a choice between:
             1446          (i) (A) catastrophic mental health coverage; or
             1447          (B) federally qualified mental health coverage as described in Subsection (3); and
             1448          (ii) 50/50 mental health coverage.
             1449          (b) In addition to complying with Subsection (2)(a), an insurer may offer to provide:
             1450          (i) catastrophic mental health coverage, 50/50 mental health coverage, or both at levels
             1451      that exceed the minimum requirements of this section; or
             1452          (ii) coverage that excludes benefits for mental health conditions.
             1453          (c) A small employer may, at its option, regardless of the employer's previous coverage
             1454      for mental health conditions, choose either:
             1455          (i) coverage offered under Subsection (2)(a)(i);
             1456          (ii) 50/50 mental health coverage; or
             1457          (iii) coverage offered under Subsection (2)(b).


             1458          (d) An insurer is exempt from the 30% index rating restriction in Section
             1459      31A-30-106.1 and, for the first year only that the employer chooses coverage that meets or
             1460      exceeds catastrophic mental health coverage [is chosen], the 15% annual adjustment restriction
             1461      in Section 31A-30-106.1 , for any small employer with 20 or less enrolled employees who
             1462      chooses coverage that meets or exceeds catastrophic mental health coverage.
             1463          (3) An insurer shall offer a large employer mental health and substance use disorder
             1464      benefit in compliance with Section 2705 of the Public Health Service Act, 42 U.S.C. Sec.
             1465      300gg-26, and federal regulations adopted pursuant to that act.
             1466          (4) (a) An insurer may provide catastrophic mental health coverage to a small employer
             1467      through a managed care organization or system in a manner consistent with Chapter 8, Health
             1468      Maintenance Organizations and Limited Health Plans, regardless of whether the insurance
             1469      policy uses a managed care organization or system for the treatment of physical health
             1470      conditions.
             1471          (b) (i) Notwithstanding any other provision of this title, an insurer may:
             1472          (A) establish a closed panel of providers for catastrophic mental health coverage; and
             1473          (B) refuse to provide a benefit to be paid for services rendered by a nonpanel provider
             1474      unless:
             1475          (I) the insured is referred to a nonpanel provider with the prior authorization of the
             1476      insurer; and
             1477          (II) the nonpanel provider agrees to follow the insurer's protocols and treatment
             1478      guidelines.
             1479          (ii) If an insured receives services from a nonpanel provider in the manner permitted by
             1480      Subsection (4)(b)(i)(B), the insurer shall reimburse the insured for not less than 75% of the
             1481      average amount paid by the insurer for comparable services of panel providers under a
             1482      noncapitated arrangement who are members of the same class of health care providers.
             1483          (iii) This Subsection (4)(b) may not be construed as requiring an insurer to authorize a
             1484      referral to a nonpanel provider.
             1485          (c) To be eligible for catastrophic mental health coverage, a diagnosis or treatment of a


             1486      mental health condition shall be rendered:
             1487          (i) by a mental health therapist as defined in Section 58-60-102 ; or
             1488          (ii) in a health care facility:
             1489          (A) licensed or otherwise authorized to provide mental health services pursuant to:
             1490          (I) Title 26, Chapter 21, Health Care Facility Licensing and Inspection Act; or
             1491          (II) Title 62A, Chapter 2, Licensure of Programs and Facilities; and
             1492          (B) that provides a program for the treatment of a mental health condition pursuant to a
             1493      written plan.
             1494          (5) The commissioner may prohibit an insurance policy that provides mental health
             1495      coverage in a manner that is inconsistent with this section.
             1496          (6) The commissioner shall:
             1497          (a) adopt rules, in accordance with Title 63G, Chapter 3, Utah Administrative
             1498      Rulemaking Act, as necessary to ensure compliance with this section; and
             1499          (b) provide general figures on the percentage of insurance policies that include:
             1500          (i) no mental health coverage;
             1501          (ii) 50/50 mental health coverage;
             1502          (iii) catastrophic mental health coverage; and
             1503          (iv) coverage that exceeds the minimum requirements of this section.
             1504          (7) This section may not be construed as discouraging or otherwise preventing an
             1505      insurer from providing mental health coverage in connection with an individual insurance
             1506      policy.
             1507          Section 6. Section 31A-22-629 is amended to read:
             1508           31A-22-629. Adverse benefit determination review process.
             1509          (1) As used in this section:
             1510          (a) (i) "Adverse benefit determination" means the:
             1511          (A) denial of a benefit;
             1512          (B) reduction of a benefit;
             1513          (C) termination of a benefit; or


             1514          (D) failure to provide or make payment, in whole or in part, for a benefit.
             1515          (ii) "Adverse benefit determination" includes:
             1516          (A) denial, reduction, termination, or failure to provide or make payment that is based
             1517      on a determination of an insured's or a beneficiary's eligibility to participate in a plan;
             1518          (B) [with respect to individual or group health plans, and income replacement or
             1519      disability income policies, a] denial, reduction, or termination of, or a failure to provide or
             1520      make payment, in whole or in part, for, a benefit resulting from the application of a utilization
             1521      review; [and] or
             1522          (C) failure to cover an item or service for which benefits are otherwise provided
             1523      because it is determined to be:
             1524          (I) experimental;
             1525          (II) investigational; or
             1526          (III) not medically necessary or appropriate.
             1527          (b) "Independent review" means a process that:
             1528          (i) is a voluntary option for the resolution of an adverse benefit determination;
             1529          (ii) is conducted at the discretion of the claimant;
             1530          (iii) is conducted by an independent review organization designated by the insurer;
             1531          (iv) renders an independent and impartial decision on an adverse benefit determination
             1532      submitted by an insured; and
             1533          (v) may not require the insured to pay a fee for requesting the independent review.
             1534          (c) "Independent review organization" means a person, subject to Subsection (6), who
             1535      conducts an independent external review of adverse determinations.
             1536          (d) "Insured" is as defined in Section 31A-1-301 and includes a person who is
             1537      authorized to act on the insured's behalf.
             1538          (e) "Insurer" is as defined in Section 31A-1-301 and includes:
             1539          (i) a health maintenance organization; and
             1540          (ii) a third party administrator that offers, sells, manages, or administers a health
             1541      insurance policy or health maintenance organization contract that is subject to this title.


             1542          (f) "Internal review" means the process an insurer uses to review an insured's adverse
             1543      benefit determination before the adverse benefit determination is submitted for independent
             1544      review.
             1545          (2) This section applies generally to health insurance policies, health maintenance
             1546      organization contracts, and income replacement or disability income policies.
             1547          (3) (a) An insured may submit an adverse benefit determination to the insurer.
             1548          (b) The insurer shall conduct an internal review of the insured's adverse benefit
             1549      determination.
             1550          (c) An insured who disagrees with the results of an internal review may submit the
             1551      adverse benefit determination for an independent review if the adverse benefit determination
             1552      involves:
             1553          (i) payment of a claim regarding medical necessity; or
             1554          (ii) denial of a claim regarding medical necessity.
             1555          (4) The commissioner shall adopt rules that establish minimum standards for:
             1556          (a) internal reviews;
             1557          (b) independent reviews to ensure independence and impartiality;
             1558          (c) the types of adverse benefit determinations that may be submitted to an independent
             1559      review; and
             1560          (d) the timing of the review process, including an expedited review when medically
             1561      necessary.
             1562          (5) Nothing in this section may be construed as:
             1563          (a) expanding, extending, or modifying the terms of a policy or contract with respect to
             1564      benefits or coverage;
             1565          (b) permitting an insurer to charge an insured for the internal review of an adverse
             1566      benefit determination;
             1567          (c) restricting the use of arbitration in connection with or subsequent to an independent
             1568      review; or
             1569          (d) altering the legal rights of any party to seek court or other redress in connection


             1570      with:
             1571          (i) an adverse decision resulting from an independent review, except that if the insurer
             1572      is the party seeking legal redress, the insurer shall pay for the reasonable attorney fees of the
             1573      insured related to the action and court costs; or
             1574          (ii) an adverse benefit determination or other claim that is not eligible for submission
             1575      to independent review.
             1576          (6) (a) An independent review organization in relation to the insurer may not be:
             1577          (i) the insurer;
             1578          (ii) the health plan;
             1579          (iii) the health plan's fiduciary;
             1580          (iv) the employer; or
             1581          (v) an employee or agent of any one listed in Subsections (6)(a)(i) through (iv).
             1582          (b) An independent review organization may not have a material professional, familial,
             1583      or financial conflict of interest with:
             1584          (i) the health plan;
             1585          (ii) an officer, director, or management employee of the health plan;
             1586          (iii) the enrollee;
             1587          (iv) the enrollee's health care provider;
             1588          (v) the health care provider's medical group or independent practice association;
             1589          (vi) a health care facility where service would be provided; or
             1590          (vii) the developer or manufacturer of the service that would be provided.
             1591          Section 7. Section 31A-22-635 is amended to read:
             1592           31A-22-635. Uniform application -- Uniform waiver of coverage -- Information
             1593      on Health Insurance Exchange.
             1594          (1) For purposes of this section, "insurer":
             1595          (a) is defined in Subsection 31A-22-634 (1); and
             1596          (b) includes the state employee's risk pool under Section 49-20-202 .
             1597          (2) (a) Insurers offering a health benefit plan to an individual or small employer shall


             1598      use a uniform application form.
             1599          (b) The uniform application form:
             1600          (i) except for cancer and transplants, may not include questions about an applicant's
             1601      health history prior to the previous five years; and
             1602          (ii) shall be shortened and simplified in accordance with rules adopted by the
             1603      commissioner.
             1604          (c) Insurers offering a health benefit plan to a small employer shall use a uniform
             1605      waiver of coverage form, which may not include health status related questions other than
             1606      pregnancy, and is limited to:
             1607          (i) information that identifies the employee;
             1608          (ii) proof of the employee's insurance coverage; and
             1609          (iii) a statement that the employee declines coverage with a particular employer group.
             1610          (3) Notwithstanding the requirements of Subsection (2)(a), the uniform application and
             1611      uniform waiver of coverage forms may, if the combination or modification is approved by the
             1612      commissioner, be combined or modified to facilitate a more efficient and consumer friendly
             1613      experience for:
             1614          (a) enrollees using the Health Insurance Exchange [if the modification is approved by
             1615      the commissioner.]; or
             1616          (b) insurers using electronic applications.
             1617          (4) The uniform application form, and uniform waiver form, shall be adopted and
             1618      approved by the commissioner in accordance with Title 63G, Chapter 3, Utah Administrative
             1619      Rulemaking Act.
             1620          (5) (a) An insurer who offers a health benefit plan in either the group or individual
             1621      market on the Health Insurance Exchange created in Section 63M-1-2504 , shall:
             1622          (i) accept and process an electronic submission of the uniform application or uniform
             1623      waiver from the Health Insurance Exchange using the electronic standards adopted pursuant to
             1624      Section 63M-1-2506 ;
             1625          (ii) if requested, provide the applicant with a copy of the completed application either


             1626      by mail or electronically;
             1627          (iii) post all health benefit plans offered by the insurer in the defined contribution
             1628      arrangement market on the Health Insurance Exchange; and
             1629          (iv) post the information required by Subsection (6) on the Health Insurance Exchange
             1630      for every health benefit plan the insurer offers on the Health Insurance Exchange.
             1631          (b) Except as provided in Subsection (5)(c), an insurer who posts health benefit plans
             1632      on the Health Insurance Exchange may not directly or indirectly offer products on the Health
             1633      Insurance Exchange that are not health benefit plans.
             1634          (c) Notwithstanding Subsection (5)(b), an insurer may offer a health savings account
             1635      on the Health Insurance Exchange.
             1636          (6) An insurer shall provide the commissioner and the Health Insurance Exchange with
             1637      the following information for each health benefit plan submitted to the Health Insurance
             1638      Exchange, in the electronic format required by Subsection 63M-1-2506 (1):
             1639          (a) plan design, benefits, and options offered by the health benefit plan including state
             1640      mandates the plan does not cover;
             1641          (b) information and Internet address to online provider networks;
             1642          (c) wellness programs and incentives;
             1643          (d) descriptions of prescription drug benefits, exclusions, or limitations;
             1644          (e) the percentage of claims paid by the insurer within 30 days of the date a claim is
             1645      submitted to the insurer for the prior year; and
             1646          (f) the claims denial and insurer transparency information developed in accordance
             1647      with Subsection 31A-22-613.5 (4).
             1648          (7) The [Insurance Department] department shall post on the Health Insurance
             1649      Exchange the [Insurance Department's] department's solvency rating for each insurer who posts
             1650      a health benefit plan on the Health Insurance Exchange. The solvency rating for each insurer
             1651      shall be based on methodology established by the [Insurance Department] department by
             1652      administrative rule and shall be updated each calendar year.
             1653          (8) (a) The commissioner may request information from an insurer under Section


             1654      31A-22-613.5 to verify the data submitted to the [Insurance Department] department and to the
             1655      Health Insurance Exchange.
             1656          (b) The commissioner shall regulate any fees charged by insurers to an enrollee for a
             1657      uniform application form or electronic submission of the application forms.
             1658          Section 8. Section 31A-23a-101 is amended to read:
             1659           31A-23a-101. Purposes.
             1660          The purposes of this chapter include:
             1661          (1) promoting the professional competence of insurance producers, surplus lines
             1662      producers, limited line producers, [customer service representatives,] consultants, managing
             1663      general agents, and reinsurance intermediaries;
             1664          (2) providing maximum freedom of marketing methods for insurance, consistent with
             1665      the interests of the Utah public;
             1666          (3) preserving and encouraging competition at the consumer level;
             1667          (4) regulating insurance marketing practices in conformity with the general purposes of
             1668      this title;
             1669          (5) governing the qualifications and procedures for the licensing of insurance
             1670      producers, surplus lines producers, limited line producers, [customer service representatives,]
             1671      consultants, managing general agents, and reinsurance intermediaries; and
             1672          (6) promoting uniform licensing requirements between the several states.
             1673          Section 9. Section 31A-23a-102 is amended to read:
             1674           31A-23a-102. Definitions.
             1675          As used in this chapter:
             1676          (1) "Bail bond producer" [means a person who:] is as defined in Section 31A-35-102 .
             1677          [(a) is appointed by:]
             1678          [(i) a surety insurer that issues bail bonds; or]
             1679          [(ii) a bail bond surety company licensed under Chapter 35, Bail Bond Act;]
             1680          [(b) is designated to execute or countersign undertakings of bail in connection with a
             1681      judicial proceeding; and]


             1682          [(c) receives or is promised money or other things of value for engaging in an act
             1683      described in Subsection (1)(b).]
             1684          (2) "Escrow" means a license subline of authority in conjunction with the title
             1685      insurance line of authority that allows a person to conduct escrow as defined in Section
             1686      31A-1-301 .
             1687          (3) "Home state" means a state or territory of the United States or the District of
             1688      Columbia in which an insurance producer:
             1689          (a) maintains the insurance producer's principal:
             1690          (i) place of residence; or
             1691          (ii) place of business; and
             1692          (b) is licensed to act as an insurance producer.
             1693          (4) "Insurer" is as defined in Section 31A-1-301 , except that the following persons or
             1694      similar persons are not insurers for purposes of Part 7, Producer Controlled Insurers:
             1695          (a) a risk retention group as defined in:
             1696          (i) the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499;
             1697          (ii) the Risk Retention Act, 15 U.S.C. Sec. 3901 et seq.; and
             1698          (iii) Chapter 15, Part 2, Risk Retention Groups Act;
             1699          (b) a residual market pool;
             1700          (c) a joint underwriting authority or association; and
             1701          (d) a captive insurer.
             1702          (5) "License" is defined in Section 31A-1-301 .
             1703          (6) (a) "Managing general agent" means a person that:
             1704          (i) manages all or part of the insurance business of an insurer, including the
             1705      management of a separate division, department, or underwriting office;
             1706          (ii) acts as an agent for the insurer whether it is known as a managing general agent,
             1707      manager, or other similar term;
             1708          (iii) produces and underwrites an amount of gross direct written premium equal to, or
             1709      more than 5% of, the policyholder surplus as reported in the last annual statement of the insurer


             1710      in any one quarter or year:
             1711          (A) with or without the authority;
             1712          (B) separately or together with an affiliate; and
             1713          (C) directly or indirectly; and
             1714          (iv) (A) adjusts or pays claims in excess of an amount determined by the
             1715      commissioner; or
             1716          (B) negotiates reinsurance on behalf of the insurer.
             1717          (b) Notwithstanding Subsection (6)(a), the following persons may not be considered as
             1718      managing general agent for the purposes of this chapter:
             1719          (i) an employee of the insurer;
             1720          (ii) a United States manager of the United States branch of an alien insurer;
             1721          (iii) an underwriting manager that, pursuant to contract:
             1722          (A) manages all the insurance operations of the insurer;
             1723          (B) is under common control with the insurer;
             1724          (C) is subject to Chapter 16, Insurance Holding Companies; and
             1725          (D) is not compensated based on the volume of premiums written; and
             1726          (iv) the attorney-in-fact authorized by and acting for the subscribers of a reciprocal
             1727      insurer or inter-insurance exchange under powers of attorney.
             1728          (7) "Negotiate" means the act of conferring directly with or offering advice directly to a
             1729      purchaser or prospective purchaser of a particular contract of insurance concerning a
             1730      substantive benefit, term, or condition of the contract if the person engaged in that act:
             1731          (a) sells insurance; or
             1732          (b) obtains insurance from insurers for purchasers.
             1733          (8) "Reinsurance intermediary" means:
             1734          (a) a reinsurance intermediary-broker; or
             1735          (b) a reinsurance intermediary-manager.
             1736          (9) "Reinsurance intermediary-broker" means a person other than an officer or
             1737      employee of the ceding insurer, firm, association, or corporation who solicits, negotiates, or


             1738      places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority
             1739      or power to bind reinsurance on behalf of the insurer.
             1740          (10) (a) "Reinsurance intermediary-manager" means a person who:
             1741          (i) has authority to bind or who manages all or part of the assumed reinsurance
             1742      business of a reinsurer, including the management of a separate division, department, or
             1743      underwriting office; and
             1744          (ii) acts as an agent for the reinsurer whether the person is known as a reinsurance
             1745      intermediary-manager, manager, or other similar term.
             1746          (b) Notwithstanding Subsection (10)(a), the following persons may not be considered
             1747      reinsurance intermediary-managers for the purpose of this chapter with respect to the reinsurer:
             1748          (i) an employee of the reinsurer;
             1749          (ii) a United States manager of the United States branch of an alien reinsurer;
             1750          (iii) an underwriting manager that, pursuant to contract:
             1751          (A) manages all the reinsurance operations of the reinsurer;
             1752          (B) is under common control with the reinsurer;
             1753          (C) is subject to Chapter 16, Insurance Holding Companies; and
             1754          (D) is not compensated based on the volume of premiums written; and
             1755          (iv) the manager of a group, association, pool, or organization of insurers that:
             1756          (A) engage in joint underwriting or joint reinsurance; and
             1757          (B) are subject to examination by the insurance commissioner of the state in which the
             1758      manager's principal business office is located.
             1759          (11) "Search" means a license subline of authority in conjunction with the title
             1760      insurance line of authority that allows a person to issue title insurance commitments or policies
             1761      on behalf of a title insurer.
             1762          (12) "Sell" means to exchange a contract of insurance:
             1763          (a) by any means;
             1764          (b) for money or its equivalent; and
             1765          (c) on behalf of an insurance company.


             1766          (13) "Solicit" means:
             1767          (a) attempting to sell insurance;
             1768          (b) asking or urging a person to apply for:
             1769          (i) a particular kind of insurance; and
             1770          (ii) insurance from a particular insurance company;
             1771          (c) advertising insurance, including advertising for the purpose of obtaining leads for
             1772      the sale of insurance; or
             1773          (d) holding oneself out as being in the insurance business.
             1774          (14) "Terminate" means:
             1775          (a) the cancellation of the relationship between:
             1776          (i) an individual licensee or agency licensee and a particular insurer; or
             1777          (ii) an individual licensee and a particular agency licensee; or
             1778          (b) the termination of:
             1779          (i) an individual licensee's or agency licensee's authority to transact insurance on behalf
             1780      of a particular insurance company; or
             1781          (ii) an individual licensee's authority to transact insurance on behalf of a particular
             1782      agency licensee.
             1783          (15) "Title marketing representative" means a person who:
             1784          (a) represents a title insurer in soliciting, requesting, or negotiating the placing of:
             1785          (i) title insurance; or
             1786          (ii) escrow services; and
             1787          (b) does not have a search or escrow license as provided in Section 31A-23a-106 .
             1788          (16) "Uniform application" means the version of the National Association of Insurance
             1789      Commissioners' uniform application for resident and nonresident producer licensing at the time
             1790      the application is filed.
             1791          (17) "Uniform business entity application" means the version of the National
             1792      Association of Insurance Commissioners' uniform business entity application for resident and
             1793      nonresident business entities at the time the application is filed.


             1794          Section 10. Section 31A-23a-103 is amended to read:
             1795           31A-23a-103. Requirement of license.
             1796          (1) (a) Unless exempted from the licensing requirement under Section 31A-23a-201 or
             1797      31A-23a-207 , a person may not perform, offer to perform, or advertise any service as a
             1798      producer, surplus lines producer, limited line producer, [customer service representative,]
             1799      consultant, managing general agent, or reinsurance intermediary in Utah, without a valid
             1800      individual or agency license issued under this chapter.
             1801          (b) A valid license includes at least one license type and one line of authority
             1802      pertaining to that license type.
             1803          (c) A person may not utilize the services of another as a producer, surplus lines
             1804      producer, limited line producer, [customer service representative,] consultant, managing
             1805      general agent, or reinsurance intermediary if that person knows or should know that the other
             1806      does not have a license as required by law.
             1807          (2) This part may not be construed to require an insurer to obtain an insurance producer
             1808      license.
             1809          (3) An insurance contract is not invalid as a result of a violation of this section.
             1810          Section 11. Section 31A-23a-104 is amended to read:
             1811           31A-23a-104. Application for individual license -- Application for agency license.
             1812          (1) This section applies to an initial or renewal license as a:
             1813          (a) producer;
             1814          (b) surplus lines producer;
             1815          [(b)] (c) limited line producer;
             1816          [(c) customer service representative;]
             1817          (d) consultant;
             1818          (e) managing general agent; or
             1819          (f) reinsurance intermediary.
             1820          (2) (a) Subject to Subsection (2)(b), to obtain or renew an individual license, an
             1821      individual shall:


             1822          (i) file an application for an initial or renewal individual license with the commissioner
             1823      on forms and in a manner the commissioner prescribes; and
             1824          (ii) pay a license fee that is not refunded if the application:
             1825          (A) is denied; or
             1826          (B) is incomplete when filed and is never completed by the applicant.
             1827          (b) An application described in this Subsection (2) shall provide:
             1828          (i) information about the applicant's identity;
             1829          (ii) the applicant's Social Security number;
             1830          (iii) the applicant's personal history, experience, education, and business record;
             1831          (iv) whether the applicant is 18 years of age or older;
             1832          (v) whether the applicant has committed an act that is a ground for denial, suspension,
             1833      or revocation as set forth in Section 31A-23a-105 or 31A-23a-111 ;
             1834          (vi) if the application is for a resident individual producer license, certification that the
             1835      applicant complies with Section 31A-23a-203.5 ; and
             1836          (vii) any other information the commissioner reasonably requires.
             1837          (3) The commissioner may require a document reasonably necessary to verify the
             1838      information contained in an application filed under this section.
             1839          (4) An applicant's Social Security number contained in an application filed under this
             1840      section is a private record under Section 63G-2-302 .
             1841          (5) (a) Subject to Subsection (5)(b), to obtain or renew an agency license, a person
             1842      shall:
             1843          (i) file an application for an initial or renewal agency license with the commissioner on
             1844      forms and in a manner the commissioner prescribes; and
             1845          (ii) pay a license fee that is not refunded if the application:
             1846          (A) is denied; or
             1847          (B) is incomplete when filed and is never completed by the applicant.
             1848          (b) An application described in Subsection (5)(a) shall provide:
             1849          (i) information about the applicant's identity;


             1850          (ii) the applicant's federal employer identification number;
             1851          (iii) the designated responsible licensed producer;
             1852          (iv) the identity of [all] the owners, partners, officers, and directors;
             1853          (v) whether the applicant has committed an act that is a ground for denial, suspension,
             1854      or revocation as set forth in Section 31A-23a-105 or 31A-23a-111 ; and
             1855          (vi) any other information the commissioner reasonably requires.
             1856          Section 12. Section 31A-23a-105 is amended to read:
             1857           31A-23a-105. General requirements for individual and agency license issuance
             1858      and renewal.
             1859          (1) (a) The commissioner shall issue or renew a license to a person described in
             1860      Subsection (1)(b) to act as:
             1861          (i) a producer;
             1862          (ii) a surplus lines producer;
             1863          [(ii)] (iii) a limited line producer;
             1864          [(iii) a customer service representative;]
             1865          (iv) a consultant;
             1866          (v) a managing general agent; or
             1867          (vi) a reinsurance intermediary.
             1868          (b) The commissioner shall issue or renew a license under Subsection (1)(a) to a
             1869      person who, as to the license type and line of authority classification applied for under Section
             1870      31A-23a-106 :
             1871          (i) satisfies the application requirements under Section 31A-23a-104 ;
             1872          (ii) satisfies the character requirements under Section 31A-23a-107 ;
             1873          (iii) satisfies any applicable continuing education requirements under Section
             1874      31A-23a-202 ;
             1875          (iv) satisfies any applicable examination requirements under Section 31A-23a-108 ;
             1876          (v) satisfies any applicable training period requirements under Section 31A-23a-203 ;
             1877          (vi) if an applicant for a resident individual producer license, certifies that, to the extent


             1878      applicable, the applicant:
             1879          (A) is in compliance with Section 31A-23a-203.5 ; and
             1880          (B) will maintain compliance with Section 31A-23a-203.5 during the period for which
             1881      the license is issued or renewed;
             1882          (vii) has not committed an act that is a ground for denial, suspension, or revocation as
             1883      provided in Section 31A-23a-111 ;
             1884          (viii) if a nonresident:
             1885          (A) complies with Section 31A-23a-109 ; and
             1886          (B) holds an active similar license in that person's state of residence;
             1887          (ix) if an applicant for a title insurance producer license, satisfies the requirements of
             1888      [Sections 31A-23a-203 and ] Section 31A-23a-204 ;
             1889          (x) if an applicant for a license to act as a life settlement provider or life settlement
             1890      producer, satisfies the requirements of Section 31A-23a-117 ; and
             1891          (xi) pays the applicable fees under Section 31A-3-103 .
             1892          (2) (a) This Subsection (2) applies to the following persons:
             1893          (i) an applicant for a pending:
             1894          (A) individual or agency producer license;
             1895          (B) surplus lines producer license;
             1896          [(B)] (C) limited line producer license;
             1897          [(C) customer service representative license;]
             1898          (D) consultant license;
             1899          (E) managing general agent license; or
             1900          (F) reinsurance intermediary license; or
             1901          (ii) a licensed:
             1902          (A) individual or agency producer;
             1903          (B) surplus lines producer;
             1904          [(B)] (C) limited line producer;
             1905          [(C) customer service representative;]


             1906          (D) consultant;
             1907          (E) managing general agent; or
             1908          (F) reinsurance intermediary.
             1909          (b) A person described in Subsection (2)(a) shall report to the commissioner:
             1910          (i) an administrative action taken against the person, including a denial of a new or
             1911      renewal license application:
             1912          (A) in another jurisdiction; or
             1913          (B) by another regulatory agency in this state; and
             1914          (ii) a criminal prosecution taken against the person in any jurisdiction.
             1915          (c) The report required by Subsection (2)(b) shall:
             1916          (i) be filed:
             1917          (A) at the time the person files the application for an individual or agency license; and
             1918          (B) for an action or prosecution that occurs on or after the day on which the person
             1919      files the application:
             1920          (I) for an administrative action, within 30 days of the final disposition of the
             1921      administrative action; or
             1922          (II) for a criminal prosecution, within 30 days of the initial appearance before a court;
             1923      and
             1924          (ii) include a copy of the complaint or other relevant legal documents related to the
             1925      action or prosecution described in Subsection (2)(b).
             1926          (3) (a) The department may require a person applying for a license or for consent to
             1927      engage in the business of insurance to submit to a criminal background check as a condition of
             1928      receiving a license or consent.
             1929          (b) A person, if required to submit to a criminal background check under Subsection
             1930      (3)(a), shall:
             1931          (i) submit a fingerprint card in a form acceptable to the department; and
             1932          (ii) consent to a fingerprint background check by:
             1933          (A) the Utah Bureau of Criminal Identification; and


             1934          (B) the Federal Bureau of Investigation.
             1935          (c) For a person who submits a fingerprint card and consents to a fingerprint
             1936      background check under Subsection (3)(b), the department may request:
             1937          (i) criminal background information maintained pursuant to Title 53, Chapter 10, Part
             1938      2, Bureau of Criminal Identification, from the Bureau of Criminal Identification; and
             1939          (ii) complete Federal Bureau of Investigation criminal background checks through the
             1940      national criminal history system.
             1941          (d) Information obtained by the department from the review of criminal history records
             1942      received under this Subsection (3) shall be used by the department for the purposes of:
             1943          (i) determining if a person satisfies the character requirements under Section
             1944      31A-23a-107 for issuance or renewal of a license;
             1945          (ii) determining if a person has failed to maintain the character requirements under
             1946      Section 31A-23a-107 ; and
             1947          (iii) preventing a person who violates the federal Violent Crime Control and Law
             1948      Enforcement Act of 1994, 18 U.S.C. Sec. 1033 [and 1034], from engaging in the business of
             1949      insurance in the state.
             1950          (e) If the department requests the criminal background information, the department
             1951      shall:
             1952          (i) pay to the Department of Public Safety the costs incurred by the Department of
             1953      Public Safety in providing the department criminal background information under Subsection
             1954      (3)(c)(i);
             1955          (ii) pay to the Federal Bureau of Investigation the costs incurred by the Federal Bureau
             1956      of Investigation in providing the department criminal background information under
             1957      Subsection (3)(c)(ii); and
             1958          (iii) charge the person applying for a license or for consent to engage in the business of
             1959      insurance a fee equal to the aggregate of Subsections (3)(e)(i) and (ii).
             1960          (4) To become a resident licensee in accordance with Section 31A-23a-104 and this
             1961      section, a person licensed as one of the following in another state who moves to this state shall


             1962      apply within 90 days of establishing legal residence in this state:
             1963          (a) insurance producer;
             1964          (b) surplus lines producer;
             1965          [(b)] (c) limited line producer;
             1966          [(c) customer service representative;]
             1967          (d) consultant;
             1968          (e) managing general agent; or
             1969          (f) reinsurance intermediary.
             1970          (5) (a) The commissioner may deny a license application for a license listed in
             1971      Subsection (5)(b) if the person applying for the license, as to the license type and line of
             1972      authority classification applied for under Section 31A-23a-106 :
             1973          (i) fails to satisfy the requirements as set forth in this section; or
             1974          (ii) commits an act that is grounds for denial, suspension, or revocation as set forth in
             1975      Section 31A-23a-111 .
             1976          (b) This Subsection (5) applies to the following licenses:
             1977          (i) producer;
             1978          (ii) surplus lines producer;
             1979          [(ii)] (iii) limited line producer;
             1980          [(iii) customer service representative;]
             1981          (iv) consultant;
             1982          (v) managing general agent; or
             1983          (vi) reinsurance intermediary.
             1984          (6) Notwithstanding the other provisions of this section, the commissioner may:
             1985          (a) issue a license to an applicant for a license for a title insurance line of authority only
             1986      with the concurrence of the Title and Escrow Commission; and
             1987          (b) renew a license for a title insurance line of authority only with the concurrence of
             1988      the Title and Escrow Commission.
             1989          Section 13. Section 31A-23a-106 is amended to read:


             1990           31A-23a-106. License types.
             1991          (1) (a) A resident or nonresident license issued under this chapter shall be issued under
             1992      the license types described under Subsection (2).
             1993          (b) A license type and a line of authority pertaining to a license type describe the type
             1994      of licensee and the lines of business that a licensee may sell, solicit, or negotiate. A license
             1995      type is intended to describe the matters to be considered under any education, examination, and
             1996      training required of a license applicant under Sections 31A-23a-108 , 31A-23a-202 , and
             1997      31A-23a-203 .
             1998          (2) (a) A producer license type includes the following lines of authority:
             1999          (i) life insurance, including a nonvariable contract;
             2000          (ii) variable contracts, including variable life and annuity, if the producer has the life
             2001      insurance line of authority;
             2002          (iii) accident and health insurance, including a contract issued to a policyholder under
             2003      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
             2004      Organizations and Limited Health Plans;
             2005          (iv) property insurance;
             2006          (v) casualty insurance, including a surety or other bond;
             2007          (vi) title insurance under one or more of the following categories:
             2008          (A) search, including authority to act as a title marketing representative;
             2009          (B) escrow, including authority to act as a title marketing representative; and
             2010          (C) title marketing representative only; and
             2011          (vii) personal lines insurance[; and].
             2012          [(viii) surplus lines, if the producer has the property or casualty or both lines of
             2013      authority.]
             2014          (b) A surplus lines producer license type includes the following lines of authority:
             2015          (i) property insurance, if the person holds an underlying producer license with the
             2016      property line of insurance; and
             2017          (ii) casualty insurance, if the person holds an underlying producer license with the


             2018      casualty line of authority.
             2019          [(b)] (c) A limited line producer license type includes the following limited lines of
             2020      authority:
             2021          (i) limited line credit insurance;
             2022          (ii) travel insurance;
             2023          (iii) motor club insurance;
             2024          (iv) car rental related insurance;
             2025          (v) legal expense insurance;
             2026          (vi) crop insurance;
             2027          (vii) self-service storage insurance;
             2028          (viii) bail bond producer; and
             2029          (ix) guaranteed asset protection waiver.
             2030          [(c) A customer service representative license type includes the following lines of
             2031      authority, if held by the customer service representative's employer producer:]
             2032          [(i) life insurance, including a nonvariable contract;]
             2033          [(ii) accident and health insurance, including a contract issued to a policyholder under
             2034      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
             2035      Organizations and Limited Health Plans;]
             2036          [(iii) property insurance;]
             2037          [(iv) casualty insurance, including a surety or other bond;]
             2038          [(v) personal lines insurance; and]
             2039          [(vi) surplus lines, if the employer producer has the property or casualty or both lines of
             2040      authority.]
             2041          (d) A consultant license type includes the following lines of authority:
             2042          (i) life insurance, including a nonvariable contract;
             2043          (ii) variable contracts, including variable life and annuity, if the consultant has the life
             2044      insurance line of authority;
             2045          (iii) accident and health insurance, including a contract issued to a policyholder under


             2046      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
             2047      Organizations and Limited Health Plans;
             2048          (iv) property insurance;
             2049          (v) casualty insurance, including a surety or other bond; and
             2050          (vi) personal lines insurance.
             2051          (e) A managing general agent license type includes the following lines of authority:
             2052          (i) life insurance, including a nonvariable contract;
             2053          (ii) variable contracts, including variable life and annuity, if the managing general
             2054      agent has the life insurance line of authority;
             2055          (iii) accident and health insurance, including a contract issued to a policyholder under
             2056      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
             2057      Organizations and Limited Health Plans;
             2058          (iv) property insurance;
             2059          (v) casualty insurance, including a surety or other bond; and
             2060          (vi) personal lines insurance.
             2061          (f) A reinsurance intermediary license type includes the following lines of authority:
             2062          (i) life insurance, including a nonvariable contract;
             2063          (ii) variable contracts, including variable life and annuity, if the reinsurance
             2064      intermediary has the life insurance line of authority;
             2065          (iii) accident and health insurance, including a contract issued to a policyholder under
             2066      Chapter 7, Nonprofit Health Service Insurance Corporations, or Chapter 8, Health Maintenance
             2067      Organizations and Limited Health Plans;
             2068          (iv) property insurance;
             2069          (v) casualty insurance, including a surety or other bond; and
             2070          (vi) personal lines insurance.
             2071          (g) A person who holds a license under Subsection (2)(a)[, (d), (e), or (f)] has the
             2072      qualifications necessary to act as a holder of a license under [Subsections (2)(b) and]
             2073      Subsection (2)(c), except that the person may not act under Subsection (2)[(b)](c)(viii) or (ix).


             2074          (3) (a) The commissioner may by rule recognize other producer, surplus lines producer,
             2075      limited line producer, [customer service representative,] consultant, managing general agent, or
             2076      reinsurance intermediary lines of authority as to kinds of insurance not listed under Subsections
             2077      (2)(a) through (f).
             2078          (b) Notwithstanding Subsection (3)(a), for purposes of title insurance the Title and
             2079      Escrow Commission may by rule, with the concurrence of the commissioner and subject to
             2080      Section 31A-2-404 , recognize other categories for a title insurance producer line of authority
             2081      not listed under Subsection (2)(a)(vi).
             2082          (4) The variable contracts[, including variable life and annuity] line of authority
             2083      requires:
             2084          [(a) licensure as a registered agent or broker by the Financial Industry Regulatory
             2085      Authority; and]
             2086          [(b) current registration with a securities broker-dealer.]
             2087          (a) for a producer, licensure by the Financial Industry Regulatory Authority as a:
             2088          (i) registered broker-dealer; or
             2089          (ii) broker-dealer agent, with a current registration with a broker-dealer; and
             2090          (b) for a consultant, registration with the Securities and Exchange Commission or
             2091      licensure by the Utah Division of Securities as an:
             2092          (i) investment adviser; or
             2093          (ii) investment adviser representative, with a current association with an investment
             2094      adviser.
             2095          (5) A surplus lines producer is a producer who has a surplus lines [line of authority]
             2096      license.
             2097          Section 14. Section 31A-23a-107 is amended to read:
             2098           31A-23a-107. Character requirements.
             2099          [Each] An applicant for a license under this chapter shall show to the commissioner
             2100      that:
             2101          (1) the applicant has the intent in good faith, to engage in the type of business that the


             2102      license applied for would permit;
             2103          (2) (a) if a natural person, the applicant is competent and trustworthy; or[,]
             2104          (b) if the applicant is an agency[, all]:
             2105          (i) the partners, directors, or principal officers or persons having comparable powers
             2106      are trustworthy[,]; and
             2107          (ii) that it will transact business in such a way that [all] the acts that may only be
             2108      performed by a licensed producer, surplus lines producer, limited line producer, [customer
             2109      service representative,] consultant, managing general agent, or reinsurance intermediary are
             2110      performed exclusively by natural persons who are licensed under this chapter to transact that
             2111      type of business and designated on the agency's license;
             2112          (3) the applicant intends to comply with Section 31A-23a-502 ; and
             2113          (4) if a natural person, the applicant is at least 18 years of age.
             2114          Section 15. Section 31A-23a-108 is amended to read:
             2115           31A-23a-108. Examination requirements.
             2116          (1) (a) The commissioner may require applicants for any particular license type under
             2117      Section 31A-23a-106 to pass a line of authority examination as a requirement for a license,
             2118      except that an examination may not be required of applicants for:
             2119          (i) licenses under [Subsections] Subsection 31A-23a-106 (2)[(b)](c) [and (c)]; or
             2120          (ii) other limited line license lines of authority recognized by the commissioner or the
             2121      Title and Escrow Commission by rule as provided in Subsection 31A-23a-106 (3).
             2122          (b) The examination described in Subsection (1)(a):
             2123          (i) shall reasonably relate to the line of authority for which it is prescribed; and
             2124          (ii) may be administered by the commissioner or as otherwise specified by rule.
             2125          (2) The commissioner shall waive the requirement of an examination for a nonresident
             2126      applicant who:
             2127          (a) applies for an insurance producer license in this state;
             2128          (b) has been licensed for the same line of authority in another state; and
             2129          (c) (i) is licensed in the state described in Subsection (2)(b) at the time the applicant


             2130      applies for an insurance producer license in this state; or
             2131          (ii) if the application is received within 90 days of the cancellation of the applicant's
             2132      previous license:
             2133          (A) the prior state certifies that at the time of cancellation, the applicant was in good
             2134      standing in that state; or
             2135          (B) the state's producer database records maintained by the National Association of
             2136      Insurance Commissioners or the National Association of Insurance Commissioner's affiliates or
             2137      subsidiaries, indicates that the producer is or was licensed in good standing for the line of
             2138      authority requested.
             2139          (3) A nonresident producer licensee who moves to this state and applies for a resident
             2140      license within 90 days of establishing legal residence in this state shall be exempt from any line
             2141      of authority examination that the producer was authorized on the producer's nonresident
             2142      producer license, except where the commissioner determines otherwise by rule.
             2143          (4) This section's requirement may only be applied to applicants who are natural
             2144      persons.
             2145          Section 16. Section 31A-23a-109 is amended to read:
             2146           31A-23a-109. Nonresident jurisdictional agreement.
             2147          (1) (a) If a nonresident license applicant has a valid producer, surplus lines producer,
             2148      limited line producer, [customer service representative,] consultant, managing general agent, or
             2149      reinsurance intermediary license from the nonresident license applicant's home state and the
             2150      conditions of Subsection (1)(b) are met, the commissioner shall:
             2151          (i) waive [all] the license requirements for a license under this chapter; and
             2152          (ii) issue the nonresident license applicant a nonresident license.
             2153          (b) Subsection (1)(a) applies if:
             2154          (i) the nonresident license applicant:
             2155          (A) is licensed as a resident in the nonresident license applicant's home state at the time
             2156      the nonresident license applicant applies for a nonresident producer, surplus lines producer,
             2157      limited line producer, [customer service representative,] consultant, managing general agent, or


             2158      reinsurance intermediary license;
             2159          (B) has submitted the proper request for licensure;
             2160          (C) has submitted to the commissioner:
             2161          (I) the application for licensure that the nonresident license applicant submitted to the
             2162      applicant's home state; or
             2163          (II) a completed uniform application; and
             2164          (D) has paid the applicable fees under Section 31A-3-103 ; and
             2165          (ii) the nonresident license applicant's license in the applicant's home state is in good
             2166      standing.
             2167          (2) A nonresident applicant applying under Subsection (1) shall in addition to
             2168      complying with all license requirements for a license under this chapter execute, in a form
             2169      acceptable to the commissioner, an agreement to be subject to the jurisdiction of the Utah
             2170      commissioner and courts on any matter related to the applicant's insurance activities in this
             2171      state, on the basis of:
             2172          (a) service of process under Sections 31A-2-309 and 31A-2-310 ; or
             2173          (b) service authorized:
             2174          (i) in the Utah Rules of Civil Procedure; or
             2175          (ii) under Section 78B-3-206 .
             2176          (3) The commissioner may verify a producer's licensing status through the producer
             2177      database maintained by:
             2178          (a) the National Association of Insurance Commissioners; or
             2179          (b) an affiliate or subsidiary of the National Association of Insurance Commissioners.
             2180          (4) The commissioner may not assess a greater fee for an insurance license or related
             2181      service to a person not residing in this state solely on the fact that the person does not reside in
             2182      this state.
             2183          Section 17. Section 31A-23a-111 is amended to read:
             2184           31A-23a-111. Revocation, suspension, surrender, lapsing, limiting, or otherwise
             2185      terminating a license -- Rulemaking for renewal or reinstatement.


             2186          (1) A license type issued under this chapter remains in force until:
             2187          (a) revoked or suspended under Subsection (5);
             2188          (b) surrendered to the commissioner and accepted by the commissioner in lieu of
             2189      administrative action;
             2190          (c) the licensee dies or is adjudicated incompetent as defined under:
             2191          (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
             2192          (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
             2193      Minors;
             2194          (d) lapsed under Section 31A-23a-113 ; or
             2195          (e) voluntarily surrendered.
             2196          (2) The following may be reinstated within one year after the day on which the license
             2197      is no longer in force:
             2198          (a) a lapsed license; or
             2199          (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
             2200      not be reinstated after the license period in which the license is voluntarily surrendered.
             2201          (3) Unless otherwise stated in a written agreement for the voluntary surrender of a
             2202      license, submission and acceptance of a voluntary surrender of a license does not prevent the
             2203      department from pursuing additional disciplinary or other action authorized under:
             2204          (a) this title; or
             2205          (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
             2206      Administrative Rulemaking Act.
             2207          (4) A line of authority issued under this chapter remains in force until:
             2208          (a) the qualifications pertaining to a line of authority are no longer met by the licensee;
             2209      or
             2210          (b) the supporting license type:
             2211          (i) is revoked or suspended under Subsection (5);
             2212          (ii) is surrendered to the commissioner and accepted by the commissioner in lieu of
             2213      administrative action;


             2214          [(iii) the licensee dies or is adjudicated incompetent as defined under:]
             2215          [(A) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or]
             2216          [(B) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
             2217      Minors;]
             2218          [(iv) lapsed] (iii) lapses under Section 31A-23a-113 ; or
             2219          [(v)] (iv) is voluntarily surrendered[.]; or
             2220          (c) the licensee dies or is adjudicated incompetent as defined under:
             2221          (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
             2222          (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
             2223      Minors.
             2224          (5) (a) If the commissioner makes a finding under Subsection (5)(b), as part of an
             2225      adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
             2226      commissioner may:
             2227          (i) revoke:
             2228          (A) a license; or
             2229          (B) a line of authority;
             2230          (ii) suspend for a specified period of 12 months or less:
             2231          (A) a license; or
             2232          (B) a line of authority;
             2233          (iii) limit in whole or in part:
             2234          (A) a license; or
             2235          (B) a line of authority; or
             2236          (iv) deny a license application.
             2237          (b) The commissioner may take an action described in Subsection (5)(a) if the
             2238      commissioner finds that the licensee:
             2239          (i) is unqualified for a license or line of authority under Section 31A-23a-104 ,
             2240      31A-23a-105 , or 31A-23a-107 ;
             2241          (ii) violates:


             2242          (A) an insurance statute;
             2243          (B) a rule that is valid under Subsection 31A-2-201 (3); or
             2244          (C) an order that is valid under Subsection 31A-2-201 (4);
             2245          (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
             2246      delinquency proceedings in any state;
             2247          (iv) fails to pay a final judgment rendered against the person in this state within 60
             2248      days after the day on which the judgment became final;
             2249          (v) fails to meet the same good faith obligations in claims settlement that is required of
             2250      admitted insurers;
             2251          (vi) is affiliated with and under the same general management or interlocking
             2252      directorate or ownership as another insurance producer that transacts business in this state
             2253      without a license;
             2254          (vii) refuses:
             2255          (A) to be examined; or
             2256          (B) to produce its accounts, records, and files for examination;
             2257          (viii) has an officer who refuses to:
             2258          (A) give information with respect to the insurance producer's affairs; or
             2259          (B) perform any other legal obligation as to an examination;
             2260          (ix) provides information in the license application that is:
             2261          (A) incorrect;
             2262          (B) misleading;
             2263          (C) incomplete; or
             2264          (D) materially untrue;
             2265          (x) violates an insurance law, valid rule, or valid order of another state's insurance
             2266      department;
             2267          (xi) obtains or attempts to obtain a license through misrepresentation or fraud;
             2268          (xii) improperly withholds, misappropriates, or converts money or properties received
             2269      in the course of doing insurance business;


             2270          (xiii) intentionally misrepresents the terms of an actual or proposed:
             2271          (A) insurance contract;
             2272          (B) application for insurance; or
             2273          (C) life settlement;
             2274          (xiv) is convicted of a felony;
             2275          (xv) admits or is found to have committed an insurance unfair trade practice or fraud;
             2276          (xvi) in the conduct of business in this state or elsewhere:
             2277          (A) uses fraudulent, coercive, or dishonest practices; or
             2278          (B) demonstrates incompetence, untrustworthiness, or financial irresponsibility;
             2279          (xvii) has an insurance license, or its equivalent, denied, suspended, or revoked in
             2280      another state, province, district, or territory;
             2281          (xviii) forges another's name to:
             2282          (A) an application for insurance; or
             2283          (B) a document related to an insurance transaction;
             2284          (xix) improperly uses notes or another reference material to complete an examination
             2285      for an insurance license;
             2286          (xx) knowingly accepts insurance business from an individual who is not licensed;
             2287          (xxi) fails to comply with an administrative or court order imposing a child support
             2288      obligation;
             2289          (xxii) fails to:
             2290          (A) pay state income tax; or
             2291          (B) comply with an administrative or court order directing payment of state income
             2292      tax;
             2293          (xxiii) violates or permits others to violate the federal Violent Crime Control and Law
             2294      Enforcement Act of 1994, 18 U.S.C. Sec. 1033 [and 1034] and therefore under 18 U.S.C. Sec.
             2295      1033 is prohibited from engaging in the business of insurance; or
             2296          (xxiv) engages in a method or practice in the conduct of business that endangers the
             2297      legitimate interests of customers and the public.


             2298          (c) For purposes of this section, if a license is held by an agency, both the agency itself
             2299      and any individual designated under the license are considered to be the holders of the license.
             2300          (d) If an individual designated under the agency license commits an act or fails to
             2301      perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
             2302      the commissioner may suspend, revoke, or limit the license of:
             2303          (i) the individual;
             2304          (ii) the agency, if the agency:
             2305          (A) is reckless or negligent in its supervision of the individual; or
             2306          (B) knowingly participates in the act or failure to act that is the ground for suspending,
             2307      revoking, or limiting the license; or
             2308          (iii) (A) the individual; and
             2309          (B) the agency if the agency meets the requirements of Subsection (5)(d)(ii).
             2310          (6) A licensee under this chapter is subject to the penalties for acting as a licensee
             2311      without a license if:
             2312          (a) the licensee's license is:
             2313          (i) revoked;
             2314          (ii) suspended;
             2315          (iii) limited;
             2316          (iv) surrendered in lieu of administrative action;
             2317          (v) lapsed; or
             2318          (vi) voluntarily surrendered; and
             2319          (b) the licensee:
             2320          (i) continues to act as a licensee; or
             2321          (ii) violates the terms of the license limitation.
             2322          (7) A licensee under this chapter shall immediately report to the commissioner:
             2323          (a) a revocation, suspension, or limitation of the person's license in another state, the
             2324      District of Columbia, or a territory of the United States;
             2325          (b) the imposition of a disciplinary sanction imposed on that person by another state,


             2326      the District of Columbia, or a territory of the United States; or
             2327          (c) a judgment or injunction entered against that person on the basis of conduct
             2328      involving:
             2329          (i) fraud;
             2330          (ii) deceit;
             2331          (iii) misrepresentation; or
             2332          (iv) a violation of an insurance law or rule.
             2333          (8) (a) An order revoking a license under Subsection (5) or an agreement to surrender a
             2334      license in lieu of administrative action may specify a time, not to exceed five years, within
             2335      which the former licensee may not apply for a new license.
             2336          (b) If no time is specified in an order or agreement described in Subsection (8)(a), the
             2337      former licensee may not apply for a new license for five years from the day on which the order
             2338      or agreement is made without the express approval by the commissioner.
             2339          (9) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
             2340      a license issued under this part if so ordered by a court.
             2341          (10) The commissioner shall by rule prescribe the license renewal and reinstatement
             2342      procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
             2343          Section 18. Section 31A-23a-113 is amended to read:
             2344           31A-23a-113. License lapse and voluntary surrender.
             2345          (1) (a) A license issued under this chapter shall lapse if the licensee fails to:
             2346          (i) pay when due a fee under Section 31A-3-103 ;
             2347          (ii) complete continuing education requirements under Section 31A-23a-202 before
             2348      submitting the license renewal application;
             2349          (iii) submit a completed renewal application as required by Section 31A-23a-104 ;
             2350          (iv) submit additional documentation required to complete the licensing process as
             2351      related to a specific license type or line of authority; or
             2352          (v) maintain an active license in a resident state if the licensee is a nonresident
             2353      licensee.


             2354          (b) (i) A licensee whose license lapses due to the following may request an action
             2355      described in Subsection (1)(b)(ii):
             2356          (A) military service;
             2357          (B) voluntary service for a period of time designated by the person for whom the
             2358      licensee provides voluntary service; or
             2359          (C) some other extenuating circumstances, such as long-term medical disability.
             2360          (ii) A licensee described in Subsection (1)(b)(i) may request:
             2361          (A) reinstatement of the license no later than one year after the day on which the
             2362      license lapses; and
             2363          (B) waiver of any of the following imposed for failure to comply with renewal
             2364      procedures:
             2365          (I) an examination requirement;
             2366          (II) reinstatement fees set under Section 31A-3-103 ;
             2367          (III) continuing education requirements; or
             2368          (IV) other sanction imposed for failure to comply with renewal procedures.
             2369          (2) If a license issued under this chapter is voluntarily surrendered, the license or line
             2370      of authority may be reinstated:
             2371          (a) during the license period in which the license is voluntarily surrendered; and
             2372          (b) no later than one year after the day on which the license is voluntarily surrendered.
             2373          (3) A voluntarily surrendered license that is reinstated during the license period set
             2374      forth in Subsection (2) may not be reinstated until the person who voluntarily surrendered the
             2375      license complies with any applicable continuing education requirements for the period during
             2376      which the license was voluntarily surrendered.
             2377          Section 19. Section 31A-23a-115.5 is amended to read:
             2378           31A-23a-115.5. Use of customer service representative.
             2379          A producer, surplus lines producer, or consultant who employs a customer service
             2380      representative [licensed under this chapter] is responsible for the duties performed by the
             2381      customer service representative. A customer service representative:


             2382          (1) may not maintain an office independent of the customer service representative's
             2383      licensed producer, surplus lines producer, or consultant employer for the purpose of conducting
             2384      insurance activities;
             2385          (2) except as provided in Subsection (3), may not sell, solicit, negotiate, or bind
             2386      coverage; and
             2387          (3) may provide a customer a quote on behalf of the customer service representative's
             2388      licensed producer, surplus lines producer, or consultant employer.
             2389          Section 20. Section 31A-23a-203 is amended to read:
             2390           31A-23a-203. Training period requirements.
             2391          (1) A producer is eligible to [add the surplus lines of authority to the person's
             2392      producer's license] become a surplus lines producer only if the producer:
             2393          (a) has passed the applicable surplus lines producer examination;
             2394          (b) has been a producer with property and casualty lines of authority for at least three
             2395      years during the four years immediately preceding the date of application; and
             2396          (c) has paid the applicable fee under Section 31A-3-103 .
             2397          (2) A person is eligible to become a consultant only if the person has acted in a
             2398      capacity that would provide the person with preparation to act as an insurance consultant for a
             2399      period aggregating not less than three years during the four years immediately preceding the
             2400      date of application.
             2401          (3) (a) A resident producer with an accident and health line of authority may only sell
             2402      long-term care insurance if the producer:
             2403          (i) initially completes a minimum of three hours of long-term care training before
             2404      selling long-term care coverage; and
             2405          (ii) after completing the training required by Subsection (3)(a)(i), completes a
             2406      minimum of three hours of long-term care training during each subsequent two-year licensing
             2407      period.
             2408          (b) A course taken to satisfy a long-term care training requirement may be used toward
             2409      satisfying a producer continuing education requirement.


             2410          (c) Long-term care training is not a continuing education requirement to renew a
             2411      producer license.
             2412          (d) An insurer that issues long-term care insurance shall demonstrate to the
             2413      commissioner, upon request, that a producer who is appointed by the insurer and who sells
             2414      long-term care insurance coverage is in compliance with this Subsection (3).
             2415          (4) The training periods required under this section apply only to an individual
             2416      applying for a license under this chapter.
             2417          Section 21. Section 31A-23a-206 is amended to read:
             2418           31A-23a-206. Special requirements for variable contracts line of authority.
             2419          (1) Before applying for a variable contracts line of authority[,]:
             2420          (a) a producer [or consultant] shall be licensed under Section 61-1-3 as a:
             2421          [(a)] (i) broker-dealer; or
             2422          [(b)] (ii) broker-dealer agent[.]; and
             2423          (b) a consultant shall be licensed under Section 61-1-3 as an:
             2424          (i) investment adviser; or
             2425          (ii) investment adviser representative.
             2426          (2) A producer's or consultant's variable contracts line of authority is revoked on the day
             2427      the producer's or consultant's securities related license under Section 61-1-3 is no longer valid.
             2428          Section 22. Section 31A-23a-301 is amended to read:
             2429           31A-23a-301. Agency license.
             2430          An insurance organization shall be licensed as an agency if the insurance organization
             2431      acts as:
             2432          (1) a producer;
             2433          (2) a surplus lines producer;
             2434          [(2)] (3) a limited line producer;
             2435          [(3)] (4) a consultant;
             2436          [(4)] (5) a managing general agent; or
             2437          [(5)] (6) a reinsurance intermediary.


             2438          Section 23. Section 31A-23a-302 is amended to read:
             2439           31A-23a-302. Agency designations.
             2440          (1) An agency shall designate an individual that has an individual producer, surplus
             2441      lines producer, limited line producer, [customer service representative,] consultant, managing
             2442      general agent, or reinsurance intermediary license to act on the agency's behalf in order for the
             2443      licensee to do business for the agency in this state.
             2444          (2) An agency shall report to the commissioner, at intervals and in the form the
             2445      commissioner establishes by rule:
             2446          (a) a new designation; and
             2447          (b) a terminated designation.
             2448          (3) (a) An agency licensed under this chapter shall report to the commissioner the
             2449      cause of termination of a designation if:
             2450          (i) the reason for termination is a reason described in Subsection 31A-23a-111 (5)(b);
             2451      or
             2452          (ii) the agency has knowledge that the individual licensee is found to have engaged in
             2453      an activity described in Subsection 31A-23a-111 (5)(b) by:
             2454          (A) a court;
             2455          (B) a government body; or
             2456          (C) a self-regulatory organization, which the commissioner may define by rule made in
             2457      accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
             2458          (b) The information provided the commissioner under Subsection (3)(a) is a private
             2459      record under Title 63G, Chapter 2, Government Records Access and Management Act.
             2460          (c) An agency is immune from civil action, civil penalty, or damages if the agency
             2461      complies in good faith with this Subsection (3) in reporting to the commissioner the cause of
             2462      termination of a designation.
             2463          (d) Notwithstanding any other provision in this section, an agency is not immune from
             2464      an action or resulting penalty imposed on the reporting agency as a result of proceedings
             2465      brought by or on behalf of the department if the action is based on evidence other than the


             2466      report submitted in compliance with this Subsection (3).
             2467          (4) An agency licensed under this chapter may act in a capacity for which it is licensed
             2468      only through an individual who is licensed under this chapter to act in the same capacity.
             2469          (5) An agency licensed under this chapter shall designate and report to the
             2470      commissioner in accordance with any rule made by the commissioner the name of the
             2471      designated responsible licensed individual who has authority to act on behalf of the agency in
             2472      [all] the matters pertaining to compliance with this title and orders of the commissioner.
             2473          (6) If an agency designates a licensee in reports submitted under Subsection (2) or (5),
             2474      there is a rebuttable presumption that the designated licensee acts on behalf of the agency.
             2475          (7) (a) When a license is held by an agency, both the agency itself and any individual
             2476      designated under the agency license shall be considered to be the holder of the agency license
             2477      for purposes of this section.
             2478          (b) If an individual designated under the agency license commits an act or fails to
             2479      perform a duty that is a ground for suspending, revoking, or limiting the agency license, the
             2480      commissioner may suspend, revoke, or limit the license of:
             2481          (i) the individual;
             2482          (ii) the agency, if the agency:
             2483          (A) is reckless or negligent in its supervision of the individual; or
             2484          (B) knowingly participates in the act or failure to act that is the ground for suspending,
             2485      revoking, or limiting the license; or
             2486          (iii) (A) the individual; and
             2487          (B) the agency if the agency meets the requirements of Subsection (7)(b)(ii).
             2488          Section 24. Section 31A-23a-402.5 is amended to read:
             2489           31A-23a-402.5. Inducements.
             2490          (1) (a) Except as provided in Subsection (2), a licensee under this title, or an officer or
             2491      employee of a licensee, may not induce a person to enter into, continue, or terminate an
             2492      insurance contract by offering a benefit that is not:
             2493          (i) specified in the insurance contract; or


             2494          (ii) directly related to the insurance contract.
             2495          (b) An insurer may not make or knowingly allow an agreement of insurance that is not
             2496      clearly expressed in the insurance contract to be issued or renewed.
             2497          (c) A licensee under this title may not absorb the tax under Section 31A-3-301 .
             2498          (2) This section does not apply to a title insurer, a title producer, or an officer or
             2499      employee of a title insurer or title producer.
             2500          (3) Items not prohibited by Subsection (1) include an insurer:
             2501          (a) reducing premiums because of expense savings;
             2502          (b) providing to a policyholder or insured one or more incentives, as defined by the
             2503      commissioner by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             2504      Rulemaking Act, to participate in a program or activity designed to reduce claims or claim
             2505      expenses; or
             2506          (c) receiving premiums under an installment payment plan.
             2507          (4) Items not prohibited by Subsection (1) include a licensee, or an officer or employee
             2508      of a licensee, either directly or through a third party:
             2509          (a) engaging in a usual kind of social courtesy if receipt of the social courtesy is not
             2510      conditioned on the purchase of a particular insurance product;
             2511          (b) extending credit on a premium to the insured:
             2512          (i) without interest, for no more than 90 days from the effective date of the insurance
             2513      contract;
             2514          (ii) for interest that is not less than the legal rate under Section 15-1-1 , on the unpaid
             2515      balance after the time period described in Subsection (4)(b)(i); and
             2516          (iii) except that an installment or payroll deduction payment of premiums on an
             2517      insurance contract issued under an insurer's mass marketing program is not considered an
             2518      extension of credit for purposes of this Subsection (4)(b);
             2519          (c) preparing or conducting a survey that:
             2520          (i) is directly related to an accident and health insurance policy purchased from the
             2521      licensee; or


             2522          (ii) is used by the licensee to assess the benefit needs and preferences of insureds,
             2523      employers, or employees directly related to an insurance product sold by the licensee;
             2524          (d) providing limited human resource services that are directly related to an insurance
             2525      product sold by the licensee, including:
             2526          (i) answering questions directly related to:
             2527          (A) an employee benefit offering or administration, if the insurance product purchased
             2528      from the licensee is accident and health insurance or health insurance; and
             2529          (B) employment practices liability, if the insurance product offered by or purchased
             2530      from the licensee is property or casualty insurance; and
             2531          (ii) providing limited human resource compliance training and education directly
             2532      pertaining to an insurance product purchased from the licensee;
             2533          (e) providing the following types of information or guidance:
             2534          (i) providing guidance directly related to compliance with federal and state laws for an
             2535      insurance product purchased from the licensee;
             2536          (ii) providing a workshop or seminar addressing an insurance issue that is directly
             2537      related to an insurance product purchased from the licensee; or
             2538          (iii) providing information regarding:
             2539          (A) employee benefit issues;
             2540          (B) directly related insurance regulatory and legislative updates; or
             2541          (C) similar education about an insurance product sold by the licensee and how the
             2542      insurance product interacts with tax law;
             2543          (f) preparing or providing a form that is directly related to an insurance product
             2544      purchased from, or offered by, the licensee;
             2545          (g) preparing or providing documents directly related to a premium only cafeteria plan
             2546      within the meaning of Section 125, Internal Revenue Code, or a flexible spending account, but
             2547      not providing ongoing administration of a flexible spending account;
             2548          (h) providing enrollment and billing assistance, including:
             2549          (i) providing benefit statements or new hire insurance benefits packages; and


             2550          (ii) providing technology services such as an electronic enrollment platform or
             2551      application system;
             2552          (i) communicating coverages in writing and in consultation with the insured and
             2553      employees;
             2554          (j) providing employee communication materials and notifications directly related to an
             2555      insurance product purchased from a licensee;
             2556          (k) providing claims management and resolution to the extent permitted under the
             2557      licensee's license;
             2558          (l) providing underwriting or actuarial analysis or services;
             2559          (m) negotiating with an insurer regarding the placement and pricing of an insurance
             2560      product;
             2561          (n) recommending placement and coverage options;
             2562          (o) providing a health fair or providing assistance or advice on establishing or
             2563      operating a wellness program, but not providing any payment for or direct operation of the
             2564      wellness program;
             2565          (p) providing COBRA and Utah mini-COBRA administration, consultations, and other
             2566      services directly related to an insurance product purchased from the licensee;
             2567          (q) assisting with a summary plan description;
             2568          (r) providing information necessary for the preparation of documents directly related to
             2569      the Employee Retirement Income Security Act of 1974, 29 U.S.C. Sec. 1001, et seq., as
             2570      amended;
             2571          (s) providing information or services directly related to the Health Insurance Portability
             2572      and Accountability Act of 1996, Pub. L. 104-191, 110 Stat. 1936, as amended, such as services
             2573      directly related to health care access, portability, and renewability when offered in connection
             2574      with accident and health insurance sold by a licensee;
             2575          (t) sending proof of coverage to a third party with a legitimate interest in coverage;
             2576          (u) providing information in a form approved by the commissioner and directly related
             2577      to determining whether an insurance product sold by the licensee meets the requirements of a


             2578      third party contract that requires or references insurance coverage;
             2579          (v) facilitating risk management services directly related to the insurance product sold
             2580      or offered for sale by the licensee, including:
             2581          (i) risk management;
             2582          (ii) claims and loss control services; and
             2583          (iii) risk assessment consulting;
             2584          (w) otherwise providing services that are legitimately part of servicing an insurance
             2585      product purchased from a licensee; and
             2586          (x) providing other directly related services approved by the department.
             2587          (5) An inducement prohibited under Subsection (1) includes a licensee, or an officer or
             2588      employee of a licensee:
             2589          (a) (i) providing a premium or commission rebate;
             2590          (ii) paying the salary of an employee of a person who purchases an insurance product
             2591      from the licensee; or
             2592          (iii) if the licensee is an insurer, or a third party administrator who contracts with an
             2593      insurer, paying the salary for an onsite staff member to perform an act prohibited under
             2594      Subsection (5)(b)(xii); or
             2595          (b) engaging in one or more of the following unless a fee is paid in accordance with
             2596      Subsection (7):
             2597          (i) performing background checks of prospective employees;
             2598          (ii) providing legal services by a person licensed to practice law;
             2599          (iii) performing drug testing that is directly related to an insurance product purchased
             2600      from the licensee;
             2601          (iv) preparing employer or employee handbooks, except that a licensee may:
             2602          (A) provide information for a medical benefit section of an employee handbook;
             2603          (B) provide information for the section of an employee handbook directly related to an
             2604      employment practices liability insurance product purchased from the licensee; or
             2605          (C) prepare or print an employee benefit enrollment guide;


             2606          (v) providing job descriptions, postings, and applications for a person that purchases an
             2607      employment practices liability insurance product from the licensee;
             2608          (vi) providing payroll services;
             2609          (vii) providing performance reviews or performance review training;
             2610          (viii) providing union advice;
             2611          (ix) providing accounting services;
             2612          (x) providing data analysis information technology programs, except as provided in
             2613      Subsection (4)(h)(ii);
             2614          (xi) providing administration of health reimbursement accounts or health savings
             2615      accounts; or
             2616          (xii) if the licensee is an insurer, or a third party administrator who contracts with an
             2617      insurer, the insurer issuing an insurance policy that lists in the insurance policy one or more of
             2618      the following prohibited benefits:
             2619          (A) performing background checks of prospective employees;
             2620          (B) providing legal services by a person licensed to practice law;
             2621          (C) performing drug testing that is directly related to an insurance product purchased
             2622      from the insurer;
             2623          (D) preparing employer or employee handbooks;
             2624          (E) providing job descriptions postings, and applications;
             2625          (F) providing payroll services;
             2626          (G) providing performance reviews or performance review training;
             2627          (H) providing union advice;
             2628          (I) providing accounting services;
             2629          (J) providing discrimination testing; or
             2630          (K) providing data analysis information technology programs.
             2631          (6) A de minimis gift or meal not to exceed $25 for each individual receiving the gift
             2632      or meal is presumed to be a social courtesy not conditioned on the purchase of a particular
             2633      insurance product for purposes of Subsection (4)(a).


             2634          (7) If as provided under Subsection (5)(b) a licensee is paid a fee to provide an item
             2635      listed in Subsection (5)(b), the licensee shall comply with Subsection 31A-23a-501 (2) in
             2636      charging the fee, except that the fee paid for the item shall equal or exceed the fair market
             2637      value of the item.
             2638          Section 25. Section 31A-23a-406 is amended to read:
             2639           31A-23a-406. Title insurance producer's business.
             2640          (1) A title insurance producer may do escrow involving real property transactions if all
             2641      of the following exist:
             2642          (a) the title insurance producer is licensed with:
             2643          (i) the title line of authority; and
             2644          (ii) the escrow subline of authority;
             2645          (b) the title insurance producer is appointed by a title insurer authorized to do business
             2646      in the state;
             2647          (c) the title insurance producer issues one or more of the following as part of the
             2648      transaction:
             2649          (i) an owner's policy of title insurance; or
             2650          (ii) a lender's policy of title insurance;
             2651          (d) money deposited with the title insurance producer in connection with any escrow:
             2652          (i) is deposited:
             2653          (A) in a federally insured financial institution; and
             2654          (B) in a trust account that is separate from all other trust account money that is not
             2655      related to real estate transactions;
             2656          (ii) is the property of the one or more persons entitled to the money under the
             2657      provisions of the escrow; and
             2658          (iii) is segregated escrow by escrow in the records of the title insurance producer;
             2659          (e) earnings on money held in escrow may be paid out of the escrow account to any
             2660      person in accordance with the conditions of the escrow;
             2661          (f) the escrow does not require the title insurance producer to hold:


             2662          (i) construction money; or
             2663          (ii) money held for exchange under Section 1031, Internal Revenue Code; and
             2664          (g) the title insurance producer shall maintain a physical office in Utah staffed by a
             2665      person with an escrow subline of authority who processes the escrow.
             2666          (2) Notwithstanding Subsection (1), a title insurance producer may engage in the
             2667      escrow business if:
             2668          (a) the escrow involves:
             2669          (i) a mobile home;
             2670          (ii) a grazing right;
             2671          (iii) a water right; or
             2672          (iv) other personal property authorized by the commissioner; and
             2673          (b) the title insurance producer complies with this section except for Subsection (1)(c).
             2674          (3) Money held in escrow:
             2675          (a) is not subject to any debts of the title insurance producer;
             2676          (b) may only be used to fulfill the terms of the individual escrow under which the
             2677      money is accepted; and
             2678          (c) may not be used until the conditions of the escrow are met.
             2679          (4) Assets or property other than escrow money received by a title insurance producer
             2680      in accordance with an escrow shall be maintained in a manner that will:
             2681          (a) reasonably preserve and protect the asset or property from loss, theft, or damages;
             2682      and
             2683          (b) otherwise comply with the general duties and responsibilities of a fiduciary or
             2684      bailee.
             2685          (5) (a) A check from the trust account described in Subsection (1)(d) may not be
             2686      drawn, executed, or dated, or money otherwise disbursed unless the segregated escrow account
             2687      from which money is to be disbursed contains a sufficient credit balance consisting of collected
             2688      and cleared money at the time the check is drawn, executed, or dated, or money is otherwise
             2689      disbursed.


             2690          (b) As used in this Subsection (5), money is considered to be "collected and cleared,"
             2691      and may be disbursed as follows:
             2692          (i) cash may be disbursed on the same day the cash is deposited;
             2693          (ii) a wire transfer may be disbursed on the same day the wire transfer is deposited; and
             2694          (iii) the proceeds of one or more of the following financial instruments may be
             2695      disbursed on the same day the financial instruments are deposited if received from a single
             2696      party to the real estate transaction and if the aggregate of the financial instruments for the real
             2697      estate transaction is less than $10,000:
             2698          (A) a cashier's check, certified check, or official check that is drawn on an existing
             2699      account at a federally insured financial institution;
             2700          (B) a check drawn on the trust account of a principal broker or associate broker
             2701      licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices Act, if the title
             2702      producer has reasonable and prudent grounds to believe sufficient money will be available
             2703      from the trust account on which the check is drawn at the time of disbursement of proceeds
             2704      from the title producer's escrow account;
             2705          (C) a personal check not to exceed $500 per closing; or
             2706          (D) a check drawn on the escrow account of another title producer, if the title producer
             2707      in the escrow transaction has reasonable and prudent grounds to believe that sufficient money
             2708      will be available for withdrawal from the account upon which the check is drawn at the time of
             2709      disbursement of money from the escrow account of the title producer in the escrow
             2710      transaction[; or].
             2711          [(E) a check issued by a farm credit service authorized under the Farm Credit Act of
             2712      1971, 12 U.S.C. Sec. 2001 et seq., as amended.]
             2713          (c) [Money received from a financial instrument described in Subsection (5)(b)(iii)(B)
             2714      or (C)] A check or deposit not described in Subsection (5)(b) may be disbursed:
             2715          (i) within the time limits provided under the Expedited Funds Availability Act, 12
             2716      U.S.C. Sec. 4001 et seq., as amended, and related regulations of the Federal Reserve System; or
             2717          (ii) upon notification from the financial institution to which the money has been


             2718      deposited that final settlement has occurred on the deposited financial instrument.
             2719          (6) A title insurance producer shall maintain a record of a receipt or disbursement of
             2720      escrow money.
             2721          (7) A title insurance producer shall comply with:
             2722          (a) Section 31A-23a-409 ;
             2723          (b) Title 46, Chapter 1, Notaries Public Reform Act; and
             2724          (c) any rules adopted by the Title and Escrow Commission, subject to Section
             2725      31A-2-404 , that govern escrows.
             2726          (8) If a title insurance producer conducts a search for real estate located in the state, the
             2727      title insurance producer shall conduct a minimum mandatory search, as defined by rule made
             2728      by the Title and Escrow Commission, subject to Section 31A-2-404 .
             2729          Section 26. Section 31A-23a-409 is amended to read:
             2730           31A-23a-409. Trust obligation for money collected.
             2731          (1) (a) Subject to Subsection (7), a licensee is a trustee for money that is paid to,
             2732      received by, or collected by a licensee for forwarding to insurers or to insureds.
             2733          (b) (i) Except as provided in Subsection (1)(b)(ii), a licensee may not commingle trust
             2734      funds with:
             2735          (A) the licensee's own money; or
             2736          (B) money held in any other capacity.
             2737          (ii) This Subsection (1)(b) does not apply to:
             2738          (A) amounts necessary to pay bank charges; and
             2739          (B) money paid by insureds and belonging in part to the licensee as a fee or
             2740      commission.
             2741          (c) Except as provided under Subsection (4), a licensee owes to insureds and insurers
             2742      the fiduciary duties of a trustee with respect to money to be forwarded to insurers or insureds
             2743      through the licensee.
             2744          (d) (i) Unless money is sent to the appropriate payee by the close of the next business
             2745      day after their receipt, the licensee shall deposit them in an account authorized under


             2746      Subsection (2).
             2747          (ii) Money deposited under this Subsection (1)(d) shall remain in an account
             2748      authorized under Subsection (2) until sent to the appropriate payee.
             2749          (2) Money required to be deposited under Subsection (1) shall be deposited:
             2750          (a) in a federally insured trust account in a depository institution, as defined in Section
             2751      7-1-103 , which:
             2752          (i) has an office in this state, if the licensee depositing the money is a resident licensee;
             2753          (ii) has federal deposit insurance; and
             2754          (iii) is authorized by its primary regulator to engage in the trust business, as defined by
             2755      Section 7-5-1 , in this state; or
             2756          (b) in some other account, approved by the commissioner by rule or order, providing
             2757      safety comparable to federally insured trust accounts.
             2758          (3) It is not a violation of Subsection (2)(a) if the amounts in the accounts exceed the
             2759      amount of the federal insurance on the accounts.
             2760          (4) A trust account into which money is deposited may be interest bearing. The
             2761      interest accrued on the account may be paid to the licensee, so long as the licensee otherwise
             2762      complies with this section and with the contract with the insurer.
             2763          (5) A depository institution or other organization holding trust funds under this section
             2764      may not offset or impound trust account funds against debts and obligations incurred by the
             2765      licensee.
             2766          (6) A licensee who, not being lawfully entitled to do so, diverts or appropriates any
             2767      portion of the money held under Subsection (1) to the licensee's own use, is guilty of theft
             2768      under Title 76, Chapter 6, Part 4, Theft. Section 76-6-412 applies in determining the
             2769      classification of the offense. Sanctions under Section 31A-2-308 also apply.
             2770          (7) A nonresident licensee:
             2771          (a) shall comply with Subsection (1)(a) by complying with the trust account
             2772      requirements of the nonresident licensee's home state; and
             2773          (b) is not required to comply with the other provisions of this section.


             2774          Section 27. Section 31A-23a-412 is amended to read:
             2775           31A-23a-412. Place of business and residence address -- Records.
             2776          (1) (a) A licensee under this chapter shall register and maintain with the commissioner:
             2777          (i) the address and telephone numbers of the licensee's principal place of business; and
             2778          (ii) a valid business email address at which the commissioner may contact the licensee.
             2779          (b) If a licensee is an individual, in addition to complying with Subsection (1)(a) the
             2780      individual shall register and maintain with the commissioner the individual's residence address
             2781      and telephone number.
             2782          (c) A licensee shall notify the commissioner within 30 days of a change of any of the
             2783      following required to be registered with the commissioner under this section:
             2784          (i) an address;
             2785          (ii) a telephone number; or
             2786          (iii) a business email address.
             2787          (2) (a) Except as provided under Subsection (3), a licensee under this chapter shall
             2788      keep at the principal place of business address registered under Subsection (1), separate and
             2789      distinct books and records of the transactions consummated under the Utah license.
             2790          (b) The books and records described in Subsection (2)(a) shall:
             2791          (i) be in an organized form;
             2792          (ii) be available to the commissioner for inspection upon reasonable notice; and
             2793          (iii) include all of the following:
             2794          (A) if the licensee is a producer, surplus lines producer, limited line producer,
             2795      consultant, managing general agent, or reinsurance intermediary:
             2796          (I) a record of each insurance contract procured by or issued through the licensee, with
             2797      the names of insurers and insureds, the amount of premium and commissions or other
             2798      compensation, and the subject of the insurance;
             2799          (II) the names of any other producers, surplus lines producers, limited line producers,
             2800      consultants, managing general agents, or reinsurance intermediaries from whom business is
             2801      accepted, and of persons to whom commissions or allowances of any kind are promised or


             2802      paid; and
             2803          (III) a record of the consumer complaints forwarded to the licensee by an insurance
             2804      regulator;
             2805          (B) if the licensee is a consultant, a record of each agreement outlining the work
             2806      performed and the fee for the work; and
             2807          (C) any additional information which:
             2808          (I) is customary for a similar business; or
             2809          (II) may reasonably be required by the commissioner by rule.
             2810          (3) Subsection (2) is satisfied if the books and records specified in Subsection (2) can
             2811      be obtained immediately from a central storage place or elsewhere by on-line computer
             2812      terminals located at the registered address.
             2813          (4) A licensee who represents only a single insurer satisfies Subsection (2) if the
             2814      insurer maintains the books and records pursuant to Subsection (2) at a place satisfying
             2815      Subsections (1) and (5).
             2816          (5) (a) The books and records maintained under Subsection (2) or Section
             2817      31A-23a-413 shall be available for the inspection of the commissioner during [all] the business
             2818      hours for a period of time after the date of the transaction as specified by the commissioner by
             2819      rule, but in no case for less than the current calendar year plus three years.
             2820          (b) Discarding books and records after the applicable record retention period has
             2821      expired does not place the licensee in violation of a later-adopted longer record retention
             2822      period.
             2823          Section 28. Section 31A-23a-504 is amended to read:
             2824           31A-23a-504. Sharing commissions.
             2825          (1) (a) Except as provided in Subsection 31A-15-103 (3), a licensee under this chapter
             2826      or an insurer may only pay consideration or reimburse out-of-pocket expenses to a person if the
             2827      licensee knows that the person is licensed under this chapter as to the particular type of
             2828      insurance to act in Utah as:
             2829          (i) a producer;


             2830          (ii) a limited line producer;
             2831          [(iii) a customer service representative;]
             2832          [(iv)] (iii) a consultant;
             2833          [(v)] (iv) a managing general agent; or
             2834          [(vi)] (v) a reinsurance intermediary.
             2835          (b) A person may only accept commission compensation or other compensation as a
             2836      person described in Subsections (1)(a)(i) through [(vi)] (v) that is directly or indirectly the
             2837      result of an insurance transaction if that person is licensed under this chapter to act as described
             2838      in Subsection (1)(a).
             2839          (2) (a) Except as provided in Section 31A-23a-501 , a consultant may not pay or receive
             2840      a commission or other compensation that is directly or indirectly the result of an insurance
             2841      transaction.
             2842          (b) A consultant may share a consultant fee or other compensation received for
             2843      consulting services performed within Utah only:
             2844          (i) with another consultant licensed under this chapter; and
             2845          (ii) to the extent that the other consultant contributed to the services performed.
             2846          (3) This section does not prohibit:
             2847          (a) the payment of renewal commissions to former licensees under this chapter, former
             2848      Title 31, Chapter 17, or their successors in interest under a deferred compensation or agency
             2849      sales agreement;
             2850          (b) compensation paid to or received by a person for referral of a potential customer
             2851      that seeks to purchase or obtain an opinion or advice on an insurance product if:
             2852          (i) the person is not licensed to sell insurance;
             2853          (ii) the person does not sell or provide opinions or advice on the product; and
             2854          (iii) the compensation does not depend on whether the referral results in a purchase or
             2855      sale; or
             2856          (c) the payment or assignment of a commission, service fee, brokerage, or other
             2857      valuable consideration to an agency or a person who does not sell, solicit, or negotiate


             2858      insurance in this state, unless the payment would constitute an inducement or commission
             2859      rebate under Section 31A-23a-402 or 31A-23a-402.5 .
             2860          (4) (a) In selling a policy of title insurance, sharing of commissions under Subsection
             2861      (1) may not occur if it will result in:
             2862          (i) an unlawful rebate;
             2863          (ii) compensation in connection with controlled business; or
             2864          (iii) payment of a forwarding fee or finder's fee.
             2865          (b) A person may share compensation for the issuance of a title insurance policy only
             2866      to the extent that the person contributed to the search and examination of the title or other
             2867      services connected with the title insurance policy.
             2868          (5) This section does not apply to a bail bond producer or bail enforcement agent as
             2869      defined in Section 31A-35-102 .
             2870          Section 29. Section 31A-25-203 is amended to read:
             2871           31A-25-203. General requirements for license issuance.
             2872          (1) The commissioner shall issue a license to act as a third party administrator to a
             2873      person who:
             2874          (a) satisfies the character requirements under Section 31A-25-204 ;
             2875          (b) satisfies the financial responsibility requirement under Section 31A-25-205 ;
             2876          (c) has not committed an act that is a ground for denial, suspension, or revocation
             2877      provided in Section 31A-25-208 ;
             2878          (d) if a nonresident, complies with Section 31A-25-206 ; and
             2879          (e) pays the applicable fees under Section 31A-3-103 .
             2880          (2) (a) This Subsection (2) applies to the following persons:
             2881          (i) an applicant for a third party administrator's license; or
             2882          (ii) a licensed third party administrator.
             2883          (b) A person described in Subsection (2)(a) shall report to the commissioner:
             2884          (i) an administrative action taken against the person, including a denial of a new or
             2885      renewal license application:


             2886          (A) in another jurisdiction; or
             2887          (B) by another regulatory agency in this state; and
             2888          (ii) a criminal prosecution taken against the person in any jurisdiction.
             2889          (c) The report required by Subsection (2)(b) shall:
             2890          (i) be filed:
             2891          (A) at the time the person applies for a third party administrator's license; and
             2892          (B) if an action or prosecution occurs on or after the day on which the person applies
             2893      for a third party administrator license:
             2894          (I) for an administrative action, within 30 days of the final disposition of the
             2895      administrative action; or
             2896          (II) for a criminal prosecution, within 30 days of the initial appearance before a court;
             2897      and
             2898          (ii) include a copy of the complaint or other relevant legal documents related to the
             2899      action or prosecution described in Subsection (2)(b).
             2900          (3) (a) The department may require a person applying for a license or for consent to
             2901      engage in the business of insurance to submit to a criminal background check as a condition of
             2902      receiving a license or consent.
             2903          (b) A person, if required to submit to a criminal background check under Subsection
             2904      (3)(a), shall:
             2905          (i) submit a fingerprint card in a form acceptable to the department; and
             2906          (ii) consent to a fingerprint background check by:
             2907          (A) the Utah Bureau of Criminal Identification; and
             2908          (B) the Federal Bureau of Investigation.
             2909          (c) For a person who submits a fingerprint card and consents to a fingerprint
             2910      background check under Subsection (3)(b), the department may request concerning a person
             2911      applying for a third party administrator's license:
             2912          (i) criminal background information maintained pursuant to Title 53, Chapter 10, Part
             2913      2, Bureau of Criminal Identification, from the Bureau of Criminal Identification; and


             2914          (ii) complete Federal Bureau of Investigation criminal background checks through the
             2915      national criminal history system.
             2916          (d) Information obtained by the department from the review of criminal history records
             2917      received under this Subsection (3) shall be used by the department for the purposes of:
             2918          (i) determining if a person satisfies the character requirements under Section
             2919      31A-25-204 for issuance or renewal of a license;
             2920          (ii) determining if a person has failed to maintain the character requirements under
             2921      Section 31A-25-204 ; and
             2922          (iii) preventing a person who violates the federal Violent Crime Control and Law
             2923      Enforcement Act of 1994, 18 U.S.C. [Secs.] Sec. 1033 [and 1034], from engaging in the
             2924      business of insurance in the state.
             2925          (e) If the department requests the criminal background information, the department
             2926      shall:
             2927          (i) pay to the Department of Public Safety the costs incurred by the Department of
             2928      Public Safety in providing the department criminal background information under Subsection
             2929      (3)(c)(i);
             2930          (ii) pay to the Federal Bureau of Investigation the costs incurred by the Federal Bureau
             2931      of Investigation in providing the department criminal background information under
             2932      Subsection (3)(c)(ii); and
             2933          (iii) charge the person applying for a license or for consent to engage in the business of
             2934      insurance a fee equal to the aggregate of Subsections (3)(e)(i) and (ii).
             2935          (4) The commissioner may deny a license application to act as a third party
             2936      administrator to a person who:
             2937          (a) fails to satisfy the requirements of this section; or
             2938          (b) commits an act that is a ground for denial, suspension, or revocation provided in
             2939      Section 31A-25-208 .
             2940          Section 30. Section 31A-25-306 is amended to read:
             2941           31A-25-306. Payments by administrator.


             2942          [All claims paid by the] An administrator shall pay a claim from [funds] money
             2943      collected on behalf of the insurer [shall be paid] on drafts or checks as authorized by the
             2944      insurer.
             2945          Section 31. Section 31A-26-203 is amended to read:
             2946           31A-26-203. Adjuster's license required.
             2947          (1) The commissioner shall issue a license to act as an independent adjuster or public
             2948      adjuster to a person who, as to the license classification applied for under Section 31A-26-204 :
             2949          (a) satisfies the character requirements under Section 31A-26-205 ;
             2950          (b) satisfies the applicable continuing education requirements under Section
             2951      31A-26-206 ;
             2952          (c) satisfies the applicable examination requirements under Section 31A-26-207 ;
             2953          (d) has not committed an act that is a ground for denial, suspension, or revocation
             2954      provided for in Section 31A-26-213 ;
             2955          (e) if a nonresident, complies with Section 31A-26-208 ; and
             2956          (f) pays the applicable fees under Section 31A-3-103 .
             2957          (2) (a) This Subsection (2) applies to the following persons:
             2958          (i) an applicant for:
             2959          (A) an independent adjuster's license; or
             2960          (B) a public adjuster's license;
             2961          (ii) a licensed independent adjuster; or
             2962          (iii) a licensed public adjuster.
             2963          (b) A person described in Subsection (2)(a) shall report to the commissioner:
             2964          (i) an administrative action taken against the person, including a denial of a new or
             2965      renewal license application:
             2966          (A) in another jurisdiction; or
             2967          (B) by another regulatory agency in this state; and
             2968          (ii) a criminal prosecution taken against the person in any jurisdiction.
             2969          (c) The report required by Subsection (2)(b) shall:


             2970          (i) be filed:
             2971          (A) at the time the person applies for an adjustor's license; and
             2972          (B) if an action or prosecution occurs on or after the day on which the person applies
             2973      for an adjustor's license:
             2974          (I) for an administrative action, within 30 days of the final disposition of the
             2975      administrative action; or
             2976          (II) for a criminal prosecution, within 30 days of the initial appearance before a court;
             2977      and
             2978          (ii) include a copy of the complaint or other relevant legal documents related to the
             2979      action or prosecution described in Subsection (2)(b).
             2980          (3) (a) The department may require a person applying for a license or for consent to
             2981      engage in the business of insurance to submit to a criminal background check as a condition of
             2982      receiving a license or consent.
             2983          (b) A person, if required to submit to a criminal background check under Subsection
             2984      (3)(a), shall:
             2985          (i) submit a fingerprint card in a form acceptable to the department; and
             2986          (ii) consent to a fingerprint background check by:
             2987          (A) the Utah Bureau of Criminal Identification; and
             2988          (B) the Federal Bureau of Investigation.
             2989          (c) For a person who submits a fingerprint card and consents to a fingerprint
             2990      background check under Subsection (3)(b), the department may request concerning a person
             2991      applying for an independent or public adjuster's license:
             2992          (i) criminal background information maintained pursuant to Title 53, Chapter 10, Part
             2993      2, Bureau of Criminal Identification, from the Bureau of Criminal Identification; and
             2994          (ii) complete Federal Bureau of Investigation criminal background checks through the
             2995      national criminal history system.
             2996          (d) Information obtained by the department from the review of criminal history records
             2997      received under this Subsection (3) shall be used by the department for the purposes of:


             2998          (i) determining if a person satisfies the character requirements under Section
             2999      31A-26-205 for issuance or renewal of a license;
             3000          (ii) determining if a person has failed to maintain the character requirements under
             3001      Section 31A-26-205 ; and
             3002          (iii) preventing a person who violates the federal Violent Crime Control and Law
             3003      Enforcement Act of 1994, 18 U.S.C. [Secs.] Sec. 1033 [and 1034], from engaging in the
             3004      business of insurance in the state.
             3005          (e) If the department requests the criminal background information, the department
             3006      shall:
             3007          (i) pay to the Department of Public Safety the costs incurred by the Department of
             3008      Public Safety in providing the department criminal background information under Subsection
             3009      (3)(c)(i);
             3010          (ii) pay to the Federal Bureau of Investigation the costs incurred by the Federal Bureau
             3011      of Investigation in providing the department criminal background information under
             3012      Subsection (3)(c)(ii); and
             3013          (iii) charge the person applying for a license or for consent to engage in the business of
             3014      insurance a fee equal to the aggregate of Subsections (3)(e)(i) and (ii).
             3015          (4) The commissioner may deny a license application to act as an independent adjuster
             3016      or public adjuster to a person who, as to the license classification applied for under Section
             3017      31A-26-204 :
             3018          (a) fails to satisfy the requirements in this section; or
             3019          (b) commits an act that is a ground for denial, suspension, or revocation provided for in
             3020      Section 31A-26-213 .
             3021          (5) Notwithstanding the other provisions of this section, the commissioner may:
             3022          (a) issue a license to an applicant for a license for a title insurance classification only
             3023      with the concurrence of the Title and Escrow Commission; or
             3024          (b) renew a license for a title insurance classification only with the concurrence of the
             3025      Title and Escrow Commission.


             3026          Section 32. Section 31A-27-503 is amended to read:
             3027           31A-27-503. Commissioner's administrative actions.
             3028          (1) (a) The commissioner may take an action described in Subsection (1)(b) whenever
             3029      the commissioner has reasonable cause to believe, and determines after a hearing that an
             3030      insurer:
             3031          (i) has committed or engaged in an act, practice, or transaction that would subject the
             3032      insurer to a formal delinquency proceeding under Chapter 27a, Insurer Receivership Act;
             3033          (ii) is committing or engaging in an act, practice, or transaction that would subject the
             3034      insurer to a formal delinquency proceeding under Chapter 27a, Insurer Receivership Act;
             3035          (iii) is about to commit or engage in an act, practice, or transaction that would subject
             3036      the insurer to a formal delinquency proceeding under Chapter 27a, Insurer Receivership Act;
             3037      [or]
             3038          (iv) is in or is about to be in a condition that would subject the insurer to a formal
             3039      delinquency proceeding under Chapter 27a, Insurer Receivership Act[.]; or
             3040          (v) is in hazardous financial condition or potentially hazardous financial condition, as
             3041      defined by rule made under Subsection 31A-27a-101 (3)(c).
             3042          (b) If the conditions of Subsection (1)(a) are met, the commissioner may make and
             3043      serve upon the insurer and any other persons whose action or forbearance from action is
             3044      reasonably necessary, those orders, other than a seizure order under Section 31A-27a-201 , that
             3045      are reasonably necessary to correct, eliminate, or remedy the act, practice, transaction, or
             3046      condition described in Subsection (1)(a).
             3047          (c) The commissioner may issue an order for the insurer to submit to supervision by a
             3048      supervisor appointed by the commissioner until the act, practice, transaction, or condition that
             3049      is the ground for the order has been halted or corrected.
             3050          (2) (a) The commissioner may make and serve an order issued under Subsection (1)
             3051      without notice and before a hearing if:
             3052          (i) the conditions of Subsection (1) are satisfied; and
             3053          (ii) it appears to the commissioner that irreparable harm to the property or business of


             3054      the insurer or to the interests of its policyholders, creditors, or the public may occur unless the
             3055      commissioner issues, with immediate effect, the order.
             3056          (b) The commissioner shall serve the insurer with an order described in this Subsection
             3057      (2) and a notice of agency action, containing a statement of the reasons why irreparable harm is
             3058      threatened unless the order is issued with immediate effect.
             3059          (3) (a) If the commissioner issues an order for supervision of an insurer under
             3060      Subsection (1) or (2), the commissioner shall:
             3061          (i) notify the insurer that the insurer is under the supervision of the commissioner; and
             3062          (ii) explain the reasons for that supervision.
             3063          (b) During the period of supervision, the commissioner may prohibit the insurer from
             3064      doing any of the following, without the prior approval of the commissioner or a supervisor
             3065      appointed by the commissioner:
             3066          (i) transferring any of its assets or its business in force;
             3067          (ii) withdrawing funds from any of its bank accounts;
             3068          (iii) lending any of its funds;
             3069          (iv) investing any of its funds;
             3070          (v) transferring any of its property;
             3071          (vi) incurring any debt, obligation, or liability other than in the ordinary and usual
             3072      course of business; or
             3073          (vii) entering into any new reinsurance contract or treaty.