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7 LONG TITLE
8 General Description:
9 This bill modifies provisions related to insurance.
10 Highlighted Provisions:
11 This bill:
12 ▸ defines terms and modifies defined terms;
13 ▸ adds provisions that a warrantor is required to disclose in a vehicle protection
14 product warranty;
15 ▸ repeals the requirement that the fixed amount of reimbursement under a vehicle
16 protection product warranty is uniform for all warranty holders of the same vehicle
17 protection product warranty;
18 ▸ addresses the requirements for filing a binder for a health benefit plan or dental
19 policy with the commissioner;
20 ▸ modifies the date on which the commissioner presents an annual evaluation of the
21 state's health insurance market;
22 ▸ classifies certain records related to an examination as protected records;
23 ▸ modifies the membership of the Title and Escrow Commission;
24 ▸ modifies provisions related to the Captive Insurance Restricted Account;
25 ▸ enacts and consolidates provisions related to an offer of qualified health insurance
26 coverage that certain contractors and subcontractors are required to obtain and
27 maintain;
28 ▸ amends the threshold at which certain contractors and subcontractors become
29 subject to certain health care-related requirements;
30 ▸ modifies the process by which the commissioner determines an applicant's ability to
31 provide proposed health care services under Title 31A, Chapter 8, Health
32 Maintenance Organizations and Limited Health Plans;
33 ▸ modifies the requirements for a nonadmitted insurer to be listed on the
34 commissioner's "reliable" list;
35 ▸ provides the circumstances under which the commissioner must hold a hearing on a
36 merger or other acquisition of an insurer;
37 ▸ amends the deadline for holding a hearing on a merger or other acquisition of an
38 insurer;
39 ▸ allows an insurer to terminate coverage of a spouse of an insured under an accident
40 and health insurance policy in the event of legal separation;
41 ▸ prohibits an insured from charging any additional amount for electing to extend
42 group coverage;
43 ▸ addresses the timing of open enrollment for individuals who extend or are eligible
44 to extend group coverage;
45 ▸ addresses the commissioner's authority to take action against a person who has had
46 an insurance license or other professional or occupational license denied,
47 suspended, revoked, or surrendered to resolve an administrative action;
48 ▸ addresses the circumstances under which an individual title insurance producer or
49 agency title insurance producer may do escrow involving real property transactions;
50 ▸ provides that the commissioner may take action against a licensee if the
51 commissioner finds that the licensee is convicted of a misdemeanor involving fraud,
52 misrepresentation, theft, or dishonesty;
53 ▸ modifies the training and continuing education requirements for certain licensees;
54 ▸ amends provisions related to the effect of an insurer's insolvency;
55 ▸ clarifies the process by which the state designates the essential health benefits for
56 the state;
57 ▸ repeals certain sections of the Insurance Code;
58 ▸ modifies the workers' compensation advisory council's reporting requirements;
59 ▸ authorizes the Labor Commission to use funds from the Industrial Accident
60 Restricted Account for specific purposes; and
61 ▸ makes technical and conforming changes.
62 Money Appropriated in this Bill:
63 None
64 Other Special Clauses:
65 None
66 Utah Code Sections Affected:
67 AMENDS:
68 17B-2a-818.5, as last amended by Laws of Utah 2016, Chapters 20 and 355
69 19-1-206, as last amended by Laws of Utah 2016, Chapters 20 and 355
70 26-18-402, as last amended by Laws of Utah 2013, Chapter 278
71 26-40-115, as last amended by Laws of Utah 2016, Chapter 20
72 31A-1-301, as last amended by Laws of Utah 2017, Chapter 292
73 31A-2-201.1, as last amended by Laws of Utah 2008, Chapter 382
74 31A-2-201.2, as last amended by Laws of Utah 2017, Chapter 292
75 31A-2-204, as last amended by Laws of Utah 2008, Chapter 382
76 31A-2-403, as last amended by Laws of Utah 2015, Chapter 330
77 31A-3-303, as last amended by Laws of Utah 2011, Chapters 62 and 275
78 31A-3-304, as last amended by Laws of Utah 2017, Chapter 168
79 31A-6a-101, as last amended by Laws of Utah 2017, Chapter 27
80 31A-6a-104, as last amended by Laws of Utah 2016, Chapter 138
81 31A-6a-105, as last amended by Laws of Utah 2015, Chapter 244
82 31A-8-104, as last amended by Laws of Utah 1997, Chapter 185
83 31A-8a-102, as last amended by Laws of Utah 2013, Chapters 104 and 135
84 31A-15-103, as last amended by Laws of Utah 2017, Chapter 363
85 31A-16-103, as last amended by Laws of Utah 2015, Chapter 244
86 31A-22-612, as last amended by Laws of Utah 2015, Chapter 244
87 31A-22-618.6, as last amended by Laws of Utah 2017, Chapter 168 and renumbered
88 and amended by Laws of Utah 2017, Chapter 292
89 31A-22-629, as last amended by Laws of Utah 2012, Chapter 253
90 31A-22-701, as last amended by Laws of Utah 2017, Chapter 168
91 31A-22-722, as last amended by Laws of Utah 2013, Chapter 319
92 31A-23a-107, as last amended by Laws of Utah 2012, Chapter 253
93 31A-23a-109, as last amended by Laws of Utah 2012, Chapter 253
94 31A-23a-111, as last amended by Laws of Utah 2017, Chapter 168
95 31A-23a-208, as enacted by Laws of Utah 2013, Chapter 341
96 31A-23a-406, as last amended by Laws of Utah 2013, Chapter 319
97 31A-23b-102, as last amended by Laws of Utah 2017, Chapter 168
98 31A-23b-202.5, as last amended by Laws of Utah 2017, Chapter 168
99 31A-23b-204, as enacted by Laws of Utah 2013, Chapter 341
100 31A-23b-205, as last amended by Laws of Utah 2014, Chapters 290, 300, 425 and last
101 amended by Coordination Clause, Laws of Utah 2014, Chapters 300, and 425
102 31A-23b-206, as last amended by Laws of Utah 2015, Chapter 244
103 31A-25-204, as enacted by Laws of Utah 1985, Chapter 242
104 31A-25-206, as last amended by Laws of Utah 2001, Chapter 116
105 31A-26-102, as last amended by Laws of Utah 2014, Chapters 290 and 300
106 31A-26-205, as last amended by Laws of Utah 1986, Chapter 204
107 31A-26-208, as last amended by Laws of Utah 2011, Chapter 284
108 31A-27a-111, as enacted by Laws of Utah 2007, Chapter 309
109 31A-27a-608, as enacted by Laws of Utah 2007, Chapter 309
110 31A-30-210, as enacted by Laws of Utah 2010, Chapter 229
111 31A-43-303, as last amended by Laws of Utah 2014, Chapters 290 and 300
112 34A-2-107, as last amended by Laws of Utah 2017, Chapters 18 and 363
113 34A-2-705, as last amended by Laws of Utah 2011, Chapter 328
114 63A-5-205, as last amended by Laws of Utah 2016, Chapters 20 and 355
115 63C-9-403, as last amended by Laws of Utah 2016, Chapters 20 and 355
116 63G-2-305, as last amended by Laws of Utah 2017, Chapters 374, 382, and 415
117 72-6-107.5, as last amended by Laws of Utah 2016, Chapters 20 and 355
118 79-2-404, as last amended by Laws of Utah 2016, Chapters 20 and 355
119 ENACTS:
120 31A-45-403, Utah Code Annotated 1953
121 63A-5-205.5, Utah Code Annotated 1953
122 REPEALS AND REENACTS:
123 31A-6a-111, as enacted by Laws of Utah 2015, Chapter 244
124 REPEALS:
125 31A-22-722.5, as last amended by Laws of Utah 2011, Chapters 297 and 340
126 31A-30-209, as last amended by Laws of Utah 2016, Chapter 138
127
128 Be it enacted by the Legislature of the state of Utah:
129 Section 1. Section 17B-2a-818.5 is amended to read:
130 17B-2a-818.5. Contracting powers of public transit districts -- Health insurance
131 coverage.
132 (1) [
133 (a) "Aggregate" means the sum of all contracts, change orders, and modifications
134 related to a single project.
135 (b) "Change order" means the same as that term is defined in Section 63G-6a-103.
136 [
137 "worker," or "operative" [
138 (i) works at least 30 hours per calendar week; and
139 (ii) meets employer eligibility waiting requirements for health care insurance, which
140 may not exceed the first day of the calendar month following 60 days [
141 after the day on which the individual is hired.
142 [
143 31A-1-301.
144 [
145 in Section 26-40-115.
146 [
147 [
148
149
150 [
151
152 [
153
154 [
155 (2) Except as provided in Subsection (3), the requirements of this section apply to:
156 (a) a contractor of a design or construction contract entered into by the public transit
157 district on or after July 1, 2009, if the prime contract is in an aggregate amount equal to or
158 greater than $2,000,000; and
159 (b) a subcontractor of a contractor of a design or construction contract entered into by
160 the public transit district on or after July 1, 2009, if the subcontract is in an aggregate amount
161 equal to or greater than $1,000,000.
162 (3) The requirements of this section do not apply to a contractor or subcontractor
163 described in Subsection (2) if:
164 (a) the application of this section jeopardizes the receipt of federal funds;
165 (b) the contract is a sole source contract; or
166 (c) the contract is an emergency procurement.
167 [
168
169
170 [
171 modifications, or multiple contracts to circumvent the requirements of [
172 section is guilty of an infraction.
173 (5) (a) A contractor subject to [
174 demonstrate to the public transit district that the contractor has and will maintain an offer of
175 qualified health insurance coverage for the contractor's employees and the employee's
176 dependents during the duration of the contract[
177 written statement that:
178 [
179
180 (i) the contractor offers qualified health insurance coverage that complies with Section
181 26-40-115;
182 (ii) is from:
183 (A) an actuary selected by the contractor or the contractor's insurer; or
184 (B) an underwriter who is responsible for developing the employer group's premium
185 rates; and
186 (iii) was created within one year before the day on which the statement is submitted.
187 (b) A contractor that is subject to the requirements of this section shall:
188 (i) place a requirement in [
189 contractor's subcontracts that a subcontractor that is subject to the requirements of this section
190 shall obtain and maintain an offer of qualified health insurance coverage for the subcontractor's
191 employees and the employees' [
192 and
193 [
194
195
196 (ii) obtain from a subcontractor that is subject to the requirements of this section a
197 written statement that:
198 (A) the subcontractor offers qualified health insurance coverage that complies with
199 Section 26-40-115;
200 (B) is from an actuary selected by the subcontractor or the subcontractor's insurer, or an
201 underwriter who is responsible for developing the employer group's premium rates; and
202 (C) was created within one year before the day on which the contractor obtains the
203 statement.
204 (c) (i) (A) A contractor [
205 offer of qualified health insurance coverage as described in Subsection (5)(a) during the
206 duration of the contract is subject to penalties in accordance with an ordinance adopted by the
207 public transit district under Subsection (6).
208 (B) A contractor is not subject to penalties for the failure of a subcontractor to [
209
210 described in Subsection (5)(b)(i).
211 (ii) (A) A subcontractor [
212 maintain an offer of qualified health insurance coverage described in Subsection (5)(b)(i)
213 during the duration of the [
214 ordinance adopted by the public transit district under Subsection (6).
215 (B) A subcontractor is not subject to penalties for the failure of a contractor to [
216
217 Subsection (5)(a).
218 (6) The public transit district shall adopt ordinances:
219 (a) in coordination with:
220 (i) the Department of Environmental Quality in accordance with Section 19-1-206;
221 (ii) the Department of Natural Resources in accordance with Section 79-2-404;
222 (iii) the State Building Board in accordance with Section [
223 (iv) the State Capitol Preservation Board in accordance with Section 63C-9-403; and
224 (v) the Department of Transportation in accordance with Section 72-6-107.5; and
225 (b) that establish:
226 (i) the requirements and procedures a contractor and a subcontractor shall follow to
227 demonstrate [
228 including:
229 [
230
231 [
232 (A) that a contractor or subcontractor's compliance with this section is subject to an
233 audit by the public transit district or the Office of the Legislative Auditor General; [
234 [
235
236
237
238
239
240 (B) that a contractor that is subject to the requirements of this section shall obtain a
241 written statement described in Subsection (5)(a); and
242 (C) that a subcontractor that is subject to the requirements of this section shall obtain a
243 written statement described in Subsection (5)(b)(ii);
244 (ii) the penalties that may be imposed if a contractor or subcontractor intentionally
245 violates the provisions of this section, which may include:
246 (A) a three-month suspension of the contractor or subcontractor from entering into
247 future contracts with the public transit district upon the first violation;
248 (B) a six-month suspension of the contractor or subcontractor from entering into future
249 contracts with the public transit district upon the second violation;
250 (C) an action for debarment of the contractor or subcontractor in accordance with
251 Section 63G-6a-904 upon the third or subsequent violation; and
252 (D) monetary penalties which may not exceed 50% of the amount necessary to
253 purchase qualified health insurance coverage for employees and dependents of employees of
254 the contractor or subcontractor who were not offered qualified health insurance coverage
255 during the duration of the contract; and
256 (iii) a website on which the district shall post the commercially equivalent benchmark,
257 for the qualified health insurance coverage identified in Subsection (1)[
258 by the Department of Health, in accordance with Subsection 26-40-115(2).
259 (7) (a) (i) In addition to the penalties imposed under Subsection (6)(b)(ii), a contractor
260 or subcontractor who intentionally violates the provisions of this section [
261 the employee for health care costs that would have been covered by qualified health insurance
262 coverage.
263 (ii) An employer has an affirmative defense to a cause of action under Subsection
264 (7)(a)(i) if:
265 (A) the employer relied in good faith on a written statement [
266
267 [
268 [
269
270 (B) a department or division determines that compliance with this section is not
271 required under the provisions of Subsection (3) [
272 (b) An employee has a private right of action only against the employee's employer to
273 enforce the provisions of this Subsection (7).
274 (8) Any penalties imposed and collected under this section shall be deposited into the
275 Medicaid Restricted Account created in Section 26-18-402.
276 (9) The failure of a contractor or subcontractor to provide qualified health insurance
277 coverage as required by this section:
278 (a) may not be the basis for a protest or other action from a prospective bidder, offeror,
279 or contractor under:
280 (i) Section 63G-6a-1602; or
281 (ii) any other provision in Title 63G, Chapter 6a, Utah Procurement Code; and
282 (b) may not be used by the procurement entity or a prospective bidder, offeror, or
283 contractor as a basis for any action or suit that would suspend, disrupt, or terminate the design
284 or construction.
285 Section 2. Section 19-1-206 is amended to read:
286 19-1-206. Contracting powers of department -- Health insurance coverage.
287 (1) [
288 (a) "Aggregate" means the sum of all contracts, change orders, and modifications
289 related to a single project.
290 (b) "Change order" means the same as that term is defined in Section 63G-6a-103.
291 [
292 "worker," or "operative" [
293 (i) works at least 30 hours per calendar week; and
294 (ii) meets employer eligibility waiting requirements for health care insurance, which
295 may not exceed the first day of the calendar month following 60 days [
296 after the day on which the individual is hired.
297 [
298 31A-1-301.
299 [
300 in Section 26-40-115.
301 [
302 [
303
304
305
306 [
307
308 [
309
310 (2) Except as provided in Subsection (3), the requirements of this section apply to:
311 (a) a contractor of a design or construction contract entered into by, or delegated to, the
312 department, or a division or board of the department, on or after July 1, 2009, if the prime
313 contract is in an aggregate amount equal to or greater than $2,000,000; and
314 (b) a subcontractor of a contractor of a design or construction contract entered into by,
315 or delegated to, the department, or a division or board of the department, on or after July 1,
316 2009, if the subcontract is in an aggregate amount equal to or greater than $1,000,000.
317 (3) This section does not apply to contracts entered into by the department or a division
318 or board of the department if:
319 (a) the application of this section jeopardizes the receipt of federal funds;
320 (b) the contract or agreement is between:
321 (i) the department or a division or board of the department; and
322 (ii) (A) another agency of the state;
323 (B) the federal government;
324 (C) another state;
325 (D) an interstate agency;
326 (E) a political subdivision of this state; or
327 (F) a political subdivision of another state;
328 (c) the executive director determines that applying the requirements of this section to a
329 particular contract interferes with the effective response to an immediate health and safety
330 threat from the environment; or
331 (d) the contract is:
332 (i) a sole source contract; or
333 (ii) an emergency procurement.
334 [
335
336
337 [
338 modifications, or multiple contracts to circumvent the requirements of [
339 section is guilty of an infraction.
340 (5) (a) A contractor subject to [
341 demonstrate to the executive director that the contractor has and will maintain an offer of
342 qualified health insurance coverage for the contractor's employees and the employees'
343 dependents during the duration of the contract[
344 written statement that:
345 [
346
347 (i) the contractor offers qualified health insurance coverage that complies with Section
348 26-40-115;
349 (ii) is from:
350 (A) an actuary selected by the contractor or the contractor's insurer; or
351 (B) an underwriter who is responsible for developing the employer group's premium
352 rates; and
353 (iii) was created within one year before the day on which the statement is submitted.
354 (b) A contractor that is subject to the requirements of this section shall:
355 (i) place a requirement in [
356 contractor's subcontracts that a subcontractor that is subject to the requirements of this section
357 shall obtain and maintain an offer of qualified health insurance coverage for the subcontractor's
358 employees and the employees' [
359 and
360 [
361
362
363 (ii) obtain from a subcontractor that is subject to the requirements of this section a
364 written statement that:
365 (A) the subcontractor offers qualified health insurance coverage that complies with
366 Section 26-40-115;
367 (B) is from an actuary selected by the subcontractor or the subcontractor's insurer, or an
368 underwriter who is responsible for developing the employer group's premium rates; and
369 (C) was created within one year before the day on which the contractor obtains the
370 statement.
371 (c) (i) (A) A contractor [
372 qualified health insurance coverage described in Subsection (5)(a) during the duration of the
373 contract is subject to penalties in accordance with administrative rules adopted by the
374 department under Subsection (6).
375 (B) A contractor is not subject to penalties for the failure of a subcontractor to [
376
377 described in Subsection (5)(b)(i).
378 (ii) (A) A subcontractor [
379 maintain an offer of qualified health insurance coverage described in Subsection (5)(b) during
380 the duration of the [
381 administrative rules adopted by the department under Subsection (6).
382 (B) A subcontractor is not subject to penalties for the failure of a contractor to [
383
384 Subsection (5)(a).
385 (6) The department shall adopt administrative rules:
386 (a) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
387 (b) in coordination with:
388 (i) a public transit district in accordance with Section 17B-2a-818.5;
389 (ii) the Department of Natural Resources in accordance with Section 79-2-404;
390 (iii) the State Building Board in accordance with Section [
391 (iv) the State Capitol Preservation Board in accordance with Section 63C-9-403;
392 (v) the Department of Transportation in accordance with Section 72-6-107.5; and
393 (vi) the Legislature's Administrative Rules Review Committee; and
394 (c) that establish:
395 (i) the requirements and procedures a contractor and a subcontractor shall follow to
396 demonstrate [
397 including:
398 [
399
400 [
401 (A) that a contractor or subcontractor's compliance with this section is subject to an
402 audit by the department or the Office of the Legislative Auditor General; [
403 [
404
405
406
407
408
409 (B) that a contractor that is subject to the requirements of this section shall obtain a
410 written statement described in Subsection (5)(a); and
411 (C) that a subcontractor that is subject to the requirements of this section shall obtain a
412 written statement described in Subsection (5)(b)(ii);
413 (ii) the penalties that may be imposed if a contractor or subcontractor intentionally
414 violates the provisions of this section, which may include:
415 (A) a three-month suspension of the contractor or subcontractor from entering into
416 future contracts with the state upon the first violation;
417 (B) a six-month suspension of the contractor or subcontractor from entering into future
418 contracts with the state upon the second violation;
419 (C) an action for debarment of the contractor or subcontractor in accordance with
420 Section 63G-6a-904 upon the third or subsequent violation; and
421 (D) notwithstanding Section 19-1-303, monetary penalties which may not exceed 50%
422 of the amount necessary to purchase qualified health insurance coverage for an employee and
423 the dependents of an employee of the contractor or subcontractor who was not offered qualified
424 health insurance coverage during the duration of the contract; and
425 (iii) a website on which the department shall post the commercially equivalent
426 benchmark, for the qualified health insurance coverage identified in Subsection (1)[
427 is provided by the Department of Health, in accordance with Subsection 26-40-115(2).
428 (7) (a) (i) In addition to the penalties imposed under Subsection (6)(c)(ii), a contractor
429 or subcontractor who intentionally violates the provisions of this section [
430 the employee for health care costs that would have been covered by qualified health insurance
431 coverage.
432 (ii) An employer has an affirmative defense to a cause of action under Subsection
433 (7)(a)(i) if:
434 (A) the employer relied in good faith on a written statement [
435
436 [
437 [
438
439 (B) the department determines that compliance with this section is not required under
440 the provisions of Subsection (3) [
441 (b) An employee has a private right of action only against the employee's employer to
442 enforce the provisions of this Subsection (7).
443 (8) Any penalties imposed and collected under this section shall be deposited into the
444 Medicaid Restricted Account created in Section 26-18-402.
445 (9) The failure of a contractor or subcontractor to provide qualified health insurance
446 coverage as required by this section:
447 (a) may not be the basis for a protest or other action from a prospective bidder, offeror,
448 or contractor under:
449 (i) Section 63G-6a-1602; or
450 (ii) any other provision in Title 63G, Chapter 6a, Utah Procurement Code; and
451 (b) may not be used by the procurement entity or a prospective bidder, offeror, or
452 contractor as a basis for any action or suit that would suspend, disrupt, or terminate the design
453 or construction.
454 Section 3. Section 26-18-402 is amended to read:
455 26-18-402. Medicaid Restricted Account.
456 (1) There is created a restricted account in the General Fund known as the Medicaid
457 Restricted Account.
458 (2) (a) Except as provided in Subsection (3), the following shall be deposited into the
459 Medicaid Restricted Account:
460 (i) any general funds appropriated to the department for the state plan for medical
461 assistance or for the Division of Health Care Financing that are not expended by the
462 department in the fiscal year for which the general funds were appropriated and which are not
463 otherwise designated as nonlapsing shall lapse into the Medicaid Restricted Account;
464 (ii) any unused state funds that are associated with the Medicaid program, as defined in
465 Section 26-18-2, from the Department of Workforce Services and the Department of Human
466 Services; and
467 (iii) any penalties imposed and collected under:
468 (A) Section 17B-2a-818.5;
469 (B) Section 19-1-206;
470 [
471 (C) Subsection 63A-5-205.5;
472 (D) Section 63C-9-403;
473 (E) Section 72-6-107.5; or
474 (F) Section 79-2-404.
475 (b) The account shall earn interest and all interest earned shall be deposited into the
476 account.
477 (c) The Legislature may appropriate money in the restricted account to fund programs
478 that expand medical assistance coverage and private health insurance plans to low income
479 persons who have not traditionally been served by Medicaid, including the Utah Children's
480 Health Insurance Program created in Chapter 40, Utah Children's Health Insurance Act.
481 (3) For fiscal years 2008-09, 2009-10, 2010-11, 2011-12, and 2012-13 the following
482 funds are nonlapsing:
483 (a) any general funds appropriated to the department for the state plan for medical
484 assistance, or for the Division of Health Care Financing that are not expended by the
485 department in the fiscal year in which the general funds were appropriated; and
486 (b) funds described in Subsection (2)(a)(ii).
487 Section 4. Section 26-40-115 is amended to read:
488 26-40-115. State contractor -- Employee and dependent health benefit plan
489 coverage.
490 (1) For purposes of Sections 17B-2a-818.5, 19-1-206, [
491 63C-9-403, 72-6-107.5, and 79-2-404, "qualified health insurance coverage" means, at the time
492 the contract is entered into or renewed:
493 (a) a health benefit plan and employer contribution level with a combined actuarial
494 value at least actuarially equivalent to the combined actuarial value of the benchmark plan
495 determined by the program under Subsection 26-40-106(1), and a contribution level at which
496 the employer pays at least 50% of the premium for the employee and the dependents of the
497 employee who reside or work in the state; or
498 (b) a federally qualified high deductible health plan that, at a minimum:
499 (i) has a deductible that is:
500 (A) the lowest deductible permitted for a federally qualified high deductible health
501 plan; or
502 (B) a deductible that is higher than the lowest deductible permitted for a federally
503 qualified high deductible health plan, but includes an employer contribution to a health savings
504 account in a dollar amount at least equal to the dollar amount difference between the lowest
505 deductible permitted for a federally qualified high deductible plan and the deductible for the
506 employer offered federally qualified high deductible plan;
507 (ii) has an out-of-pocket maximum that does not exceed three times the amount of the
508 annual deductible; and
509 (iii) provides that the employer pays 60% of the premium for the employee and the
510 dependents of the employee who work or reside in the state.
511 (2) The department shall:
512 (a) on or before July 1, 2016:
513 (i) determine the commercial equivalent of the benchmark plan described in Subsection
514 (1)(a); and
515 (ii) post the commercially equivalent benchmark plan described in Subsection (2)(a)(i)
516 on the department's website, noting the date posted; and
517 (b) update the posted commercially equivalent benchmark plan annually and at the
518 time of any change in the benchmark.
519 Section 5. Section 31A-1-301 is amended to read:
520 31A-1-301. Definitions.
521 As used in this title, unless otherwise specified:
522 (1) (a) "Accident and health insurance" means insurance to provide protection against
523 economic losses resulting from:
524 (i) a medical condition including:
525 (A) a medical care expense; or
526 (B) the risk of disability;
527 (ii) accident; or
528 (iii) sickness.
529 (b) "Accident and health insurance":
530 (i) includes a contract with disability contingencies including:
531 (A) an income replacement contract;
532 (B) a health care contract;
533 (C) an expense reimbursement contract;
534 (D) a credit accident and health contract;
535 (E) a continuing care contract; and
536 (F) a long-term care contract; and
537 (ii) may provide:
538 (A) hospital coverage;
539 (B) surgical coverage;
540 (C) medical coverage;
541 (D) loss of income coverage;
542 (E) prescription drug coverage;
543 (F) dental coverage; or
544 (G) vision coverage.
545 (c) "Accident and health insurance" does not include workers' compensation insurance.
546 (d) For purposes of a national licensing registry, "accident and health insurance" is the
547 same as "accident and health or sickness insurance."
548 (2) "Actuary" is as defined by the commissioner by rule, made in accordance with Title
549 63G, Chapter 3, Utah Administrative Rulemaking Act.
550 (3) "Administrator" means the same as that term is defined in Subsection [
551 (4) "Adult" means an individual who has attained the age of at least 18 years.
552 (5) "Affiliate" means a person who controls, is controlled by, or is under common
553 control with, another person. A corporation is an affiliate of another corporation, regardless of
554 ownership, if substantially the same group of individuals manage the corporations.
555 (6) "Agency" means:
556 (a) a person other than an individual, including a sole proprietorship by which an
557 individual does business under an assumed name; and
558 (b) an insurance organization licensed or required to be licensed under Section
559 31A-23a-301, 31A-25-207, or 31A-26-209.
560 (7) "Alien insurer" means an insurer domiciled outside the United States.
561 (8) "Amendment" means an endorsement to an insurance policy or certificate.
562 (9) "Annuity" means an agreement to make periodical payments for a period certain or
563 over the lifetime of one or more individuals if the making or continuance of all or some of the
564 series of the payments, or the amount of the payment, is dependent upon the continuance of
565 human life.
566 (10) "Application" means a document:
567 (a) (i) completed by an applicant to provide information about the risk to be insured;
568 and
569 (ii) that contains information that is used by the insurer to evaluate risk and decide
570 whether to:
571 (A) insure the risk under:
572 (I) the coverage as originally offered; or
573 (II) a modification of the coverage as originally offered; or
574 (B) decline to insure the risk; or
575 (b) used by the insurer to gather information from the applicant before issuance of an
576 annuity contract.
577 (11) "Articles" or "articles of incorporation" means:
578 (a) the original articles;
579 (b) a special law;
580 (c) a charter;
581 (d) an amendment;
582 (e) restated articles;
583 (f) articles of merger or consolidation;
584 (g) a trust instrument;
585 (h) another constitutive document for a trust or other entity that is not a corporation;
586 and
587 (i) an amendment to an item listed in Subsections (11)(a) through (h).
588 (12) "Bail bond insurance" means a guarantee that a person will attend court when
589 required, up to and including surrender of the person in execution of a sentence imposed under
590 Subsection 77-20-7(1), as a condition to the release of that person from confinement.
591 (13) "Binder" means the same as that term is defined in Section 31A-21-102.
592 (14) "Blanket insurance policy" means a group policy covering a defined class of
593 persons:
594 (a) without individual underwriting or application; and
595 (b) that is determined by definition without designating each person covered.
596 (15) "Board," "board of trustees," or "board of directors" means the group of persons
597 with responsibility over, or management of, a corporation, however designated.
598 (16) "Bona fide office" means a physical office in this state:
599 (a) that is open to the public;
600 (b) that is staffed during regular business hours on regular business days; and
601 (c) at which the public may appear in person to obtain services.
602 (17) "Business entity" means:
603 (a) a corporation;
604 (b) an association;
605 (c) a partnership;
606 (d) a limited liability company;
607 (e) a limited liability partnership; or
608 (f) another legal entity.
609 (18) "Business of insurance" means the same as that term is defined in Subsection
610 [
611 (19) "Business plan" means the information required to be supplied to the
612 commissioner under Subsections 31A-5-204(2)(i) and (j), including the information required
613 when these subsections apply by reference under:
614 (a) Section 31A-7-201;
615 (b) Section 31A-8-205; or
616 (c) Subsection 31A-9-205(2).
617 (20) (a) "Bylaws" means the rules adopted for the regulation or management of a
618 corporation's affairs, however designated.
619 (b) "Bylaws" includes comparable rules for a trust or other entity that is not a
620 corporation.
621 (21) "Captive insurance company" means:
622 (a) an insurer:
623 (i) owned by another organization; and
624 (ii) whose exclusive purpose is to insure risks of the parent organization and an
625 affiliated company; or
626 (b) in the case of a group or association, an insurer:
627 (i) owned by the insureds; and
628 (ii) whose exclusive purpose is to insure risks of:
629 (A) a member organization;
630 (B) a group member; or
631 (C) an affiliate of:
632 (I) a member organization; or
633 (II) a group member.
634 (22) "Casualty insurance" means liability insurance.
635 (23) "Certificate" means evidence of insurance given to:
636 (a) an insured under a group insurance policy; or
637 (b) a third party.
638 (24) "Certificate of authority" is included within the term "license."
639 (25) "Claim," unless the context otherwise requires, means a request or demand on an
640 insurer for payment of a benefit according to the terms of an insurance policy.
641 (26) "Claims-made coverage" means an insurance contract or provision limiting
642 coverage under a policy insuring against legal liability to claims that are first made against the
643 insured while the policy is in force.
644 (27) (a) "Commissioner" or "commissioner of insurance" means Utah's insurance
645 commissioner.
646 (b) When appropriate, the terms listed in Subsection (27)(a) apply to the equivalent
647 supervisory official of another jurisdiction.
648 (28) (a) "Continuing care insurance" means insurance that:
649 (i) provides board and lodging;
650 (ii) provides one or more of the following:
651 (A) a personal service;
652 (B) a nursing service;
653 (C) a medical service; or
654 (D) any other health-related service; and
655 (iii) provides the coverage described in this Subsection (28)(a) under an agreement
656 effective:
657 (A) for the life of the insured; or
658 (B) for a period in excess of one year.
659 (b) Insurance is continuing care insurance regardless of whether or not the board and
660 lodging are provided at the same location as a service described in Subsection (28)(a)(ii).
661 (29) (a) "Control," "controlling," "controlled," or "under common control" means the
662 direct or indirect possession of the power to direct or cause the direction of the management
663 and policies of a person. This control may be:
664 (i) by contract;
665 (ii) by common management;
666 (iii) through the ownership of voting securities; or
667 (iv) by a means other than those described in Subsections (29)(a)(i) through (iii).
668 (b) There is no presumption that an individual holding an official position with another
669 person controls that person solely by reason of the position.
670 (c) A person having a contract or arrangement giving control is considered to have
671 control despite the illegality or invalidity of the contract or arrangement.
672 (d) There is a rebuttable presumption of control in a person who directly or indirectly
673 owns, controls, holds with the power to vote, or holds proxies to vote 10% or more of the
674 voting securities of another person.
675 (30) "Controlled insurer" means a licensed insurer that is either directly or indirectly
676 controlled by a producer.
677 (31) "Controlling person" means a person that directly or indirectly has the power to
678 direct or cause to be directed, the management, control, or activities of a reinsurance
679 intermediary.
680 (32) "Controlling producer" means a producer who directly or indirectly controls an
681 insurer.
682 (33) (a) "Corporation" means an insurance corporation, except when referring to:
683 (i) a corporation doing business:
684 (A) as:
685 (I) an insurance producer;
686 (II) a surplus lines producer;
687 (III) a limited line producer;
688 (IV) a consultant;
689 (V) a managing general agent;
690 (VI) a reinsurance intermediary;
691 (VII) a third party administrator; or
692 (VIII) an adjuster; and
693 (B) under:
694 (I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
695 Reinsurance Intermediaries;
696 (II) Chapter 25, Third Party Administrators; or
697 (III) Chapter 26, Insurance Adjusters; or
698 (ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance
699 Holding Companies.
700 (b) "Mutual" or "mutual corporation" means a mutual insurance corporation.
701 (c) "Stock corporation" means a stock insurance corporation.
702 (34) (a) "Creditable coverage" has the same meaning as provided in federal regulations
703 adopted pursuant to the Health Insurance Portability and Accountability Act.
704 (b) "Creditable coverage" includes coverage that is offered through a public health plan
705 such as:
706 (i) the Primary Care Network Program under a Medicaid primary care network
707 demonstration waiver obtained subject to Section 26-18-3;
708 (ii) the Children's Health Insurance Program under Section 26-40-106; or
709 (iii) the Ryan White Program Comprehensive AIDS Resources Emergency Act, Pub. L.
710 No. 101-381, and Ryan White HIV/AIDS Treatment Modernization Act of 2006, Pub. L. No.
711 109-415.
712 (35) "Credit accident and health insurance" means insurance on a debtor to provide
713 indemnity for payments coming due on a specific loan or other credit transaction while the
714 debtor has a disability.
715 (36) (a) "Credit insurance" means insurance offered in connection with an extension of
716 credit that is limited to partially or wholly extinguishing that credit obligation.
717 (b) "Credit insurance" includes:
718 (i) credit accident and health insurance;
719 (ii) credit life insurance;
720 (iii) credit property insurance;
721 (iv) credit unemployment insurance;
722 (v) guaranteed automobile protection insurance;
723 (vi) involuntary unemployment insurance;
724 (vii) mortgage accident and health insurance;
725 (viii) mortgage guaranty insurance; and
726 (ix) mortgage life insurance.
727 (37) "Credit life insurance" means insurance on the life of a debtor in connection with
728 an extension of credit that pays a person if the debtor dies.
729 (38) "Creditor" means a person, including an insured, having a claim, whether:
730 (a) matured;
731 (b) unmatured;
732 (c) liquidated;
733 (d) unliquidated;
734 (e) secured;
735 (f) unsecured;
736 (g) absolute;
737 (h) fixed; or
738 (i) contingent.
739 (39) "Credit property insurance" means insurance:
740 (a) offered in connection with an extension of credit; and
741 (b) that protects the property until the debt is paid.
742 (40) "Credit unemployment insurance" means insurance:
743 (a) offered in connection with an extension of credit; and
744 (b) that provides indemnity if the debtor is unemployed for payments coming due on a:
745 (i) specific loan; or
746 (ii) credit transaction.
747 (41) (a) "Crop insurance" means insurance providing protection against damage to
748 crops from unfavorable weather conditions, fire or lightning, flood, hail, insect infestation,
749 disease, or other yield-reducing conditions or perils that is:
750 (i) provided by the private insurance market; or
751 (ii) subsidized by the Federal Crop Insurance Corporation.
752 (b) "Crop insurance" includes multiperil crop insurance.
753 (42) (a) "Customer service representative" means a person that provides an insurance
754 service and insurance product information:
755 (i) for the customer service representative's:
756 (A) producer;
757 (B) surplus lines producer; or
758 (C) consultant employer; and
759 (ii) to the customer service representative's employer's:
760 (A) customer;
761 (B) client; or
762 (C) organization.
763 (b) A customer service representative may only operate within the scope of authority of
764 the customer service representative's producer, surplus lines producer, or consultant employer.
765 (43) "Deadline" means a final date or time:
766 (a) imposed by:
767 (i) statute;
768 (ii) rule; or
769 (iii) order; and
770 (b) by which a required filing or payment must be received by the department.
771 (44) "Deemer clause" means a provision under this title under which upon the
772 occurrence of a condition precedent, the commissioner is considered to have taken a specific
773 action. If the statute so provides, a condition precedent may be the commissioner's failure to
774 take a specific action.
775 (45) "Degree of relationship" means the number of steps between two persons
776 determined by counting the generations separating one person from a common ancestor and
777 then counting the generations to the other person.
778 (46) "Department" means the Insurance Department.
779 (47) "Director" means a member of the board of directors of a corporation.
780 (48) "Disability" means a physiological or psychological condition that partially or
781 totally limits an individual's ability to:
782 (a) perform the duties of:
783 (i) that individual's occupation; or
784 (ii) an occupation for which the individual is reasonably suited by education, training,
785 or experience; or
786 (b) perform two or more of the following basic activities of daily living:
787 (i) eating;
788 (ii) toileting;
789 (iii) transferring;
790 (iv) bathing; or
791 (v) dressing.
792 (49) "Disability income insurance" means the same as that term is defined in
793 Subsection [
794 (50) "Domestic insurer" means an insurer organized under the laws of this state.
795 (51) "Domiciliary state" means the state in which an insurer:
796 (a) is incorporated;
797 (b) is organized; or
798 (c) in the case of an alien insurer, enters into the United States.
799 (52) (a) "Eligible employee" means:
800 (i) an employee who:
801 (A) works on a full-time basis; and
802 (B) has a normal work week of 30 or more hours; or
803 (ii) a person described in Subsection (52)(b).
804 (b) "Eligible employee" includes:
805 (i) an owner who:
806 (A) works on a full-time basis; and
807 (B) has a normal work week of 30 or more hours; and
808 (ii) if the individual is included under a health benefit plan of a small employer:
809 (A) a sole proprietor;
810 (B) a partner in a partnership; or
811 (C) an independent contractor.
812 (c) "Eligible employee" does not include, unless eligible under Subsection (52)(b):
813 (i) an individual who works on a temporary or substitute basis for a small employer;
814 (ii) an employer's spouse who does not meet the requirements of Subsection (52)(a)(i);
815 or
816 (iii) a dependent of an employer who does not meet the requirements of Subsection
817 (52)(a)(i).
818 (53) "Employee" means:
819 (a) an individual employed by an employer; and
820 (b) an owner who meets the requirements of Subsection (52)(b)(i).
821 (54) "Employee benefits" means one or more benefits or services provided to:
822 (a) an employee; or
823 (b) a dependent of an employee.
824 (55) (a) "Employee welfare fund" means a fund:
825 (i) established or maintained, whether directly or through a trustee, by:
826 (A) one or more employers;
827 (B) one or more labor organizations; or
828 (C) a combination of employers and labor organizations; and
829 (ii) that provides employee benefits paid or contracted to be paid, other than income
830 from investments of the fund:
831 (A) by or on behalf of an employer doing business in this state; or
832 (B) for the benefit of a person employed in this state.
833 (b) "Employee welfare fund" includes a plan funded or subsidized by a user fee or tax
834 revenues.
835 (56) "Endorsement" means a written agreement attached to a policy or certificate to
836 modify the policy or certificate coverage.
837 (57) (a) "Enrollee" means:
838 (i) a policyholder;
839 (ii) a certificate holder;
840 (iii) a subscriber; or
841 (iv) a covered individual:
842 (A) who has entered into a contract with an organization for health care; or
843 (B) on whose behalf an arrangement for health care has been made.
844 (b) "Enrollee" includes an insured.
845 (58) "Enrollment date," with respect to a health benefit plan, means:
846 (a) the first day of coverage; or
847 (b) if there is a waiting period, the first day of the waiting period.
848 (59) "Enterprise risk" means an activity, circumstance, event, or series of events
849 involving one or more affiliates of an insurer that, if not remedied promptly, is likely to have a
850 material adverse effect upon the financial condition or liquidity of the insurer or its insurance
851 holding company system as a whole, including anything that would cause:
852 (a) the insurer's risk-based capital to fall into an action or control level as set forth in
853 Sections 31A-17-601 through 31A-17-613; or
854 (b) the insurer to be in hazardous financial condition set forth in Section 31A-27a-101.
855 (60) (a) "Escrow" means:
856 (i) a transaction that effects the sale, transfer, encumbering, or leasing of real property,
857 when a person not a party to the transaction, and neither having nor acquiring an interest in the
858 title, performs, in accordance with the written instructions or terms of the written agreement
859 between the parties to the transaction, any of the following actions:
860 (A) the explanation, holding, or creation of a document; or
861 (B) the receipt, deposit, and disbursement of money;
862 (ii) a settlement or closing involving:
863 (A) a mobile home;
864 (B) a grazing right;
865 (C) a water right; or
866 (D) other personal property authorized by the commissioner.
867 (b) "Escrow" does not include:
868 (i) the following notarial acts performed by a notary within the state:
869 (A) an acknowledgment;
870 (B) a copy certification;
871 (C) jurat; and
872 (D) an oath or affirmation;
873 (ii) the receipt or delivery of a document; or
874 (iii) the receipt of money for delivery to the escrow agent.
875 (61) "Escrow agent" means an agency title insurance producer meeting the
876 requirements of Sections 31A-4-107, 31A-14-211, and 31A-23a-204, who is acting through an
877 individual title insurance producer licensed with an escrow subline of authority.
878 (62) (a) "Excludes" is not exhaustive and does not mean that another thing is not also
879 excluded.
880 (b) The items listed in a list using the term "excludes" are representative examples for
881 use in interpretation of this title.
882 (63) "Exclusion" means for the purposes of accident and health insurance that an
883 insurer does not provide insurance coverage, for whatever reason, for one of the following:
884 (a) a specific physical condition;
885 (b) a specific medical procedure;
886 (c) a specific disease or disorder; or
887 (d) a specific prescription drug or class of prescription drugs.
888 (64) "Expense reimbursement insurance" means insurance:
889 (a) written to provide a payment for an expense relating to hospital confinement
890 resulting from illness or injury; and
891 (b) written:
892 (i) as a daily limit for a specific number of days in a hospital; and
893 (ii) to have a one or two day waiting period following a hospitalization.
894 (65) "Fidelity insurance" means insurance guaranteeing the fidelity of a person holding
895 a position of public or private trust.
896 (66) (a) "Filed" means that a filing is:
897 (i) submitted to the department as required by and in accordance with applicable
898 statute, rule, or filing order;
899 (ii) received by the department within the time period provided in applicable statute,
900 rule, or filing order; and
901 (iii) accompanied by the appropriate fee in accordance with:
902 (A) Section 31A-3-103; or
903 (B) rule.
904 (b) "Filed" does not include a filing that is rejected by the department because it is not
905 submitted in accordance with Subsection (66)(a).
906 (67) "Filing," when used as a noun, means an item required to be filed with the
907 department including:
908 (a) a policy;
909 (b) a rate;
910 (c) a form;
911 (d) a document;
912 (e) a plan;
913 (f) a manual;
914 (g) an application;
915 (h) a report;
916 (i) a certificate;
917 (j) an endorsement;
918 (k) an actuarial certification;
919 (l) a licensee annual statement;
920 (m) a licensee renewal application;
921 (n) an advertisement;
922 (o) a binder; or
923 (p) an outline of coverage.
924 (68) "First party insurance" means an insurance policy or contract in which the insurer
925 agrees to pay a claim submitted to it by the insured for the insured's losses.
926 (69) "Foreign insurer" means an insurer domiciled outside of this state, including an
927 alien insurer.
928 (70) (a) "Form" means one of the following prepared for general use:
929 (i) a policy;
930 (ii) a certificate;
931 (iii) an application;
932 (iv) an outline of coverage; or
933 (v) an endorsement.
934 (b) "Form" does not include a document specially prepared for use in an individual
935 case.
936 (71) "Franchise insurance" means an individual insurance policy provided through a
937 mass marketing arrangement involving a defined class of persons related in some way other
938 than through the purchase of insurance.
939 (72) "General lines of authority" include:
940 (a) the general lines of insurance in Subsection (73);
941 (b) title insurance under one of the following sublines of authority:
942 (i) title examination, including authority to act as a title marketing representative;
943 (ii) escrow, including authority to act as a title marketing representative; and
944 (iii) title marketing representative only;
945 (c) surplus lines;
946 (d) workers' compensation; and
947 (e) another line of insurance that the commissioner considers necessary to recognize in
948 the public interest.
949 (73) "General lines of insurance" include:
950 (a) accident and health;
951 (b) casualty;
952 (c) life;
953 (d) personal lines;
954 (e) property; and
955 (f) variable contracts, including variable life and annuity.
956 (74) "Group health plan" means an employee welfare benefit plan to the extent that the
957 plan provides medical care:
958 (a) (i) to an employee; or
959 (ii) to a dependent of an employee; and
960 (b) (i) directly;
961 (ii) through insurance reimbursement; or
962 (iii) through another method.
963 (75) (a) "Group insurance policy" means a policy covering a group of persons that is
964 issued:
965 (i) to a policyholder on behalf of the group; and
966 (ii) for the benefit of a member of the group who is selected under a procedure defined
967 in:
968 (A) the policy; or
969 (B) an agreement that is collateral to the policy.
970 (b) A group insurance policy may include a member of the policyholder's family or a
971 dependent.
972 (76) "Guaranteed automobile protection insurance" means insurance offered in
973 connection with an extension of credit that pays the difference in amount between the
974 insurance settlement and the balance of the loan if the insured automobile is a total loss.
975 (77) (a) "Health benefit plan" means, except as provided in Subsection (77)(b), a
976 policy, contract, certificate, or agreement offered or issued by a health carrier to provide,
977 deliver, arrange for, pay for, or reimburse any of the costs of health care.
978 (b) "Health benefit plan" does not include:
979 (i) coverage only for accident or disability income insurance, or any combination
980 thereof;
981 (ii) coverage issued as a supplement to liability insurance;
982 (iii) liability insurance, including general liability insurance and automobile liability
983 insurance;
984 (iv) workers' compensation or similar insurance;
985 (v) automobile medical payment insurance;
986 (vi) credit-only insurance;
987 (vii) coverage for on-site medical clinics;
988 (viii) other similar insurance coverage, specified in federal regulations issued pursuant
989 to Pub. L. No. 104-191, under which benefits for health care services are secondary or
990 incidental to other insurance benefits;
991 (ix) the following benefits if they are provided under a separate policy, certificate, or
992 contract of insurance or are otherwise not an integral part of the plan:
993 (A) limited scope dental or vision benefits;
994 (B) benefits for long-term care, nursing home care, home health care,
995 community-based care, or any combination thereof; or
996 (C) other similar limited benefits, specified in federal regulations issued pursuant to
997 Pub. L. No. 104-191;
998 (x) the following benefits if the benefits are provided under a separate policy,
999 certificate, or contract of insurance, there is no coordination between the provision of benefits
1000 and any exclusion of benefits under any health plan, and the benefits are paid with respect to an
1001 event without regard to whether benefits are provided under any health plan:
1002 (A) coverage only for specified disease or illness; or
1003 (B) hospital indemnity or other fixed indemnity insurance; and
1004 (xi) the following if offered as a separate policy, certificate, or contract of insurance:
1005 (A) Medicare supplemental health insurance as defined under the Social Security Act,
1006 42 U.S.C. Sec. 1395ss(g)(1);
1007 (B) coverage supplemental to the coverage provided under United States Code, Title
1008 10, Chapter 55, Civilian Health and Medical Program of the Uniformed Services
1009 (CHAMPUS); or
1010 (C) similar supplemental coverage provided to coverage under a group health insurance
1011 plan.
1012 (78) "Health care" means any of the following intended for use in the diagnosis,
1013 treatment, mitigation, or prevention of a human ailment or impairment:
1014 (a) a professional service;
1015 (b) a personal service;
1016 (c) a facility;
1017 (d) equipment;
1018 (e) a device;
1019 (f) supplies; or
1020 (g) medicine.
1021 (79) (a) "Health care insurance" or "health insurance" means insurance providing:
1022 (i) a health care benefit; or
1023 (ii) payment of an incurred health care expense.
1024 (b) "Health care insurance" or "health insurance" does not include accident and health
1025 insurance providing a benefit for:
1026 (i) replacement of income;
1027 (ii) short-term accident;
1028 (iii) fixed indemnity;
1029 (iv) credit accident and health;
1030 (v) supplements to liability;
1031 (vi) workers' compensation;
1032 (vii) automobile medical payment;
1033 (viii) no-fault automobile;
1034 (ix) equivalent self-insurance; or
1035 (x) a type of accident and health insurance coverage that is a part of or attached to
1036 another type of policy.
1037 (80) "Health care provider" means the same as that term is defined in Section
1038 78B-3-403.
1039 (81) "Health insurance exchange" means an exchange as defined in 45 C.F.R. Sec.
1040 155.20.
1041 [
1042 Insurance Portability and Accountability Act of 1996, Pub. L. No. 104-191, 110 Stat. 1936, as
1043 amended.
1044 [
1045 insurance written to provide payments to replace income lost from accident or sickness.
1046 [
1047 insured loss.
1048 [
1049 under Section 31A-26-201 who engages in insurance adjusting as a representative of an insurer.
1050 [
1051 Section 31A-15-104.
1052 [
1053 [
1054 (a) property in transit on or over land;
1055 (b) property in transit over water by means other than boat or ship;
1056 (c) bailee liability;
1057 (d) fixed transportation property such as bridges, electric transmission systems, radio
1058 and television transmission towers and tunnels; and
1059 (e) personal and commercial property floaters.
1060 [
1061 (a) an insurer is unable to pay [
1062
1063 (b) an insurer's total adjusted capital is less than the insurer's mandatory control level
1064 RBC under Subsection 31A-17-601(8)(c); or
1065 (c) an [
1066 are less than the insurer's liabilities.
1067 [
1068 (i) an arrangement, contract, or plan for the transfer of a risk or risks from one or more
1069 persons to one or more other persons; or
1070 (ii) an arrangement, contract, or plan for the distribution of a risk or risks among a
1071 group of persons that includes the person seeking to distribute that person's risk.
1072 (b) "Insurance" includes:
1073 (i) a risk distributing arrangement providing for compensation or replacement for
1074 damages or loss through the provision of a service or a benefit in kind;
1075 (ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a
1076 business and not as merely incidental to a business transaction; and
1077 (iii) a plan in which the risk does not rest upon the person who makes an arrangement,
1078 but with a class of persons who have agreed to share the risk.
1079 [
1080 investigation, negotiation, or settlement of a claim under an insurance policy other than life
1081 insurance or an annuity, on behalf of an insurer, policyholder, or a claimant under an insurance
1082 policy.
1083 [
1084 (a) providing health care insurance by an organization that is or is required to be
1085 licensed under this title;
1086 (b) providing a benefit to an employee in the event of a contingency not within the
1087 control of the employee, in which the employee is entitled to the benefit as a right, which
1088 benefit may be provided either:
1089 (i) by a single employer or by multiple employer groups; or
1090 (ii) through one or more trusts, associations, or other entities;
1091 (c) providing an annuity:
1092 (i) including an annuity issued in return for a gift; and
1093 (ii) except an annuity provided by a person specified in Subsections 31A-22-1305(2)
1094 and (3);
1095 (d) providing the characteristic services of a motor club as outlined in Subsection
1096 [
1097 (e) providing another person with insurance;
1098 (f) making as insurer, guarantor, or surety, or proposing to make as insurer, guarantor,
1099 or surety, a contract or policy of title insurance;
1100 (g) transacting or proposing to transact any phase of title insurance, including:
1101 (i) solicitation;
1102 (ii) negotiation preliminary to execution;
1103 (iii) execution of a contract of title insurance;
1104 (iv) insuring; and
1105 (v) transacting matters subsequent to the execution of the contract and arising out of
1106 the contract, including reinsurance;
1107 (h) transacting or proposing a life settlement; and
1108 (i) doing, or proposing to do, any business in substance equivalent to Subsections
1109 [
1110 [
1111 (a) advises another person about insurance needs and coverages;
1112 (b) is compensated by the person advised on a basis not directly related to the insurance
1113 placed; and
1114 (c) except as provided in Section 31A-23a-501, is not compensated directly or
1115 indirectly by an insurer or producer for advice given.
1116 [
1117 affiliated persons, at least one of whom is an insurer.
1118 [
1119 to be licensed under the laws of this state to sell, solicit, or negotiate insurance.
1120 (b) (i) "Producer for the insurer" means a producer who is compensated directly or
1121 indirectly by an insurer for selling, soliciting, or negotiating an insurance product of that
1122 insurer.
1123 (ii) "Producer for the insurer" may be referred to as an "agent."
1124 (c) (i) "Producer for the insured" means a producer who:
1125 (A) is compensated directly and only by an insurance customer or an insured; and
1126 (B) receives no compensation directly or indirectly from an insurer for selling,
1127 soliciting, or negotiating an insurance product of that insurer to an insurance customer or
1128 insured.
1129 (ii) "Producer for the insured" may be referred to as a "broker."
1130 [
1131 makes a promise in an insurance policy and includes:
1132 (i) a policyholder;
1133 (ii) a subscriber;
1134 (iii) a member; and
1135 (iv) a beneficiary.
1136 (b) The definition in Subsection [
1137 (i) applies only to this title;
1138 (ii) does not define the meaning of "insured" as used in an insurance policy or
1139 certificate; and
1140 (iii) includes an enrollee.
1141 [
1142 including:
1143 (i) a fraternal benefit society;
1144 (ii) an issuer of a gift annuity other than an annuity specified in Subsections
1145 31A-22-1305(2) and (3);
1146 (iii) a motor club;
1147 (iv) an employee welfare plan;
1148 (v) a person purporting or intending to do an insurance business as a principal on that
1149 person's own account; and
1150 (vi) a health maintenance organization.
1151 (b) "Insurer" does not include a governmental entity to the extent the governmental
1152 entity is engaged in an activity described in Section 31A-12-107.
1153 [
1154 Subsection [
1155 [
1156 (a) offered in connection with an extension of credit; and
1157 (b) that provides indemnity if the debtor is involuntarily unemployed for payments
1158 coming due on a:
1159 (i) specific loan; or
1160 (ii) credit transaction.
1161 [
1162 employer who, with respect to a calendar year and to a plan year:
1163 (i) employed an average of at least 51 employees on business days during the preceding
1164 calendar year; and
1165 (ii) employs at least one employee on the first day of the plan year.
1166 (b) The number of employees shall be determined using the method set forth in 26
1167 U.S.C. Sec. 4980H(c)(2).
1168 [
1169 an individual whose enrollment is a late enrollment.
1170 [
1171 enrollment of an individual other than:
1172 (a) on the earliest date on which coverage can become effective for the individual
1173 under the terms of the plan; or
1174 (b) through special enrollment.
1175 [
1176 31A-1-103, "legal expense insurance" means insurance written to indemnify or pay for a
1177 specified legal expense.
1178 (b) "Legal expense insurance" includes an arrangement that creates a reasonable
1179 expectation of an enforceable right.
1180 (c) "Legal expense insurance" does not include the provision of, or reimbursement for,
1181 legal services incidental to other insurance coverage.
1182 [
1183 (i) for death, injury, or disability of a human being, or for damage to property,
1184 exclusive of the coverages under:
1185 (A) medical malpractice insurance;
1186 (B) professional liability insurance; and
1187 (C) workers' compensation insurance;
1188 (ii) for a medical, hospital, surgical, and funeral benefit to a person other than the
1189 insured who is injured, irrespective of legal liability of the insured, when issued with or
1190 supplemental to insurance against legal liability for the death, injury, or disability of a human
1191 being, exclusive of the coverages under:
1192 (A) medical malpractice insurance;
1193 (B) professional liability insurance; and
1194 (C) workers' compensation insurance;
1195 (iii) for loss or damage to property resulting from an accident to or explosion of a
1196 boiler, pipe, pressure container, machinery, or apparatus;
1197 (iv) for loss or damage to property caused by:
1198 (A) the breakage or leakage of a sprinkler, water pipe, or water container; or
1199 (B) water entering through a leak or opening in a building; or
1200 (v) for other loss or damage properly the subject of insurance not within another kind
1201 of insurance as defined in this chapter, if the insurance is not contrary to law or public policy.
1202 (b) "Liability insurance" includes:
1203 (i) vehicle liability insurance;
1204 (ii) residential dwelling liability insurance; and
1205 (iii) making inspection of, and issuing a certificate of inspection upon, an elevator,
1206 boiler, machinery, or apparatus of any kind when done in connection with insurance on the
1207 elevator, boiler, machinery, or apparatus.
1208 [
1209 in an activity that is part of or related to the insurance business.
1210 (b) "License" includes a certificate of authority issued to an insurer.
1211 [
1212 (i) insurance on a human life; and
1213 (ii) insurance pertaining to or connected with human life.
1214 (b) The business of life insurance includes:
1215 (i) granting a death benefit;
1216 (ii) granting an annuity benefit;
1217 (iii) granting an endowment benefit;
1218 (iv) granting an additional benefit in the event of death by accident;
1219 (v) granting an additional benefit to safeguard the policy against lapse; and
1220 (vi) providing an optional method of settlement of proceeds.
1221 [
1222 (a) is issued for a specific product of insurance; and
1223 (b) limits an individual or agency to transact only for that product or insurance.
1224 [
1225 insurance:
1226 (a) credit life;
1227 (b) credit accident and health;
1228 (c) credit property;
1229 (d) credit unemployment;
1230 (e) involuntary unemployment;
1231 (f) mortgage life;
1232 (g) mortgage guaranty;
1233 (h) mortgage accident and health;
1234 (i) guaranteed automobile protection; and
1235 (j) another form of insurance offered in connection with an extension of credit that:
1236 (i) is limited to partially or wholly extinguishing the credit obligation; and
1237 (ii) the commissioner determines by rule should be designated as a form of limited line
1238 credit insurance.
1239 [
1240 solicits, or negotiates one or more forms of limited line credit insurance coverage to an
1241 individual through a master, corporate, group, or individual policy.
1242 [
1243 (a) bail bond;
1244 (b) limited line credit insurance;
1245 (c) legal expense insurance;
1246 (d) motor club insurance;
1247 (e) car rental related insurance;
1248 (f) travel insurance;
1249 (g) crop insurance;
1250 (h) self-service storage insurance;
1251 (i) guaranteed asset protection waiver;
1252 (j) portable electronics insurance; and
1253 (k) another form of limited insurance that the commissioner determines by rule should
1254 be designated a form of limited line insurance.
1255 [
1256 Subsection [
1257 [
1258 limited lines insurance.
1259 [
1260 advertised, marketed, offered, or designated to provide coverage:
1261 (i) in a setting other than an acute care unit of a hospital;
1262 (ii) for not less than 12 consecutive months for a covered person on the basis of:
1263 (A) expenses incurred;
1264 (B) indemnity;
1265 (C) prepayment; or
1266 (D) another method;
1267 (iii) for one or more necessary or medically necessary services that are:
1268 (A) diagnostic;
1269 (B) preventative;
1270 (C) therapeutic;
1271 (D) rehabilitative;
1272 (E) maintenance; or
1273 (F) personal care; and
1274 (iv) that may be issued by:
1275 (A) an insurer;
1276 (B) a fraternal benefit society;
1277 (C) (I) a nonprofit health hospital; and
1278 (II) a medical service corporation;
1279 (D) a prepaid health plan;
1280 (E) a health maintenance organization; or
1281 (F) an entity similar to the entities described in Subsections [
1282 through (E) to the extent that the entity is otherwise authorized to issue life or health care
1283 insurance.
1284 (b) "Long-term care insurance" includes:
1285 (i) any of the following that provide directly or supplement long-term care insurance:
1286 (A) a group or individual annuity or rider; or
1287 (B) a life insurance policy or rider;
1288 (ii) a policy or rider that provides for payment of benefits on the basis of:
1289 (A) cognitive impairment; or
1290 (B) functional capacity; or
1291 (iii) a qualified long-term care insurance contract.
1292 (c) "Long-term care insurance" does not include:
1293 (i) a policy that is offered primarily to provide basic Medicare supplement coverage;
1294 (ii) basic hospital expense coverage;
1295 (iii) basic medical/surgical expense coverage;
1296 (iv) hospital confinement indemnity coverage;
1297 (v) major medical expense coverage;
1298 (vi) income replacement or related asset-protection coverage;
1299 (vii) accident only coverage;
1300 (viii) coverage for a specified:
1301 (A) disease; or
1302 (B) accident;
1303 (ix) limited benefit health coverage; or
1304 (x) a life insurance policy that accelerates the death benefit to provide the option of a
1305 lump sum payment:
1306 (A) if the following are not conditioned on the receipt of long-term care:
1307 (I) benefits; or
1308 (II) eligibility; and
1309 (B) the coverage is for one or more the following qualifying events:
1310 (I) terminal illness;
1311 (II) medical conditions requiring extraordinary medical intervention; or
1312 (III) permanent institutional confinement.
1313 [
1314 (a) licensed as a health maintenance organization under Chapter 8, Health Maintenance
1315 Organizations and Limited Health Plans; or
1316 (b) (i) licensed under:
1317 (A) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
1318 (B) Chapter 7, Nonprofit Health Service Insurance Corporations; or
1319 (C) Chapter 14, Foreign Insurers; and
1320 (ii) that requires an enrollee to use, or offers incentives, including financial incentives,
1321 for an enrollee to use, network providers.
1322 [
1323 incident to the practice and provision of a medical service other than the practice and provision
1324 of a dental service.
1325 [
1326 corporation.
1327 [
1328 must be constantly maintained by a stock insurance corporation as required by statute.
1329 [
1330 connection with an extension of credit that provides indemnity for payments coming due on a
1331 mortgage while the debtor has a disability.
1332 [
1333 mortgagee or other creditor is indemnified against losses caused by the default of a debtor.
1334 [
1335 connection with an extension of credit that pays if the debtor dies.
1336 [
1337 (a) licensed under:
1338 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
1339 (ii) Chapter 11, Motor Clubs; or
1340 (iii) Chapter 14, Foreign Insurers; and
1341 (b) that promises for an advance consideration to provide for a stated period of time
1342 one or more:
1343 (i) legal services under Subsection 31A-11-102(1)(b);
1344 (ii) bail services under Subsection 31A-11-102(1)(c); or
1345 (iii) (A) trip reimbursement;
1346 (B) towing services;
1347 (C) emergency road services;
1348 (D) stolen automobile services;
1349 (E) a combination of the services listed in Subsections [
1350 (D); or
1351 (F) other services given in Subsections 31A-11-102(1)(b) through (f).
1352 [
1353 [
1354 (a) that is issued by an insurer; and
1355 (b) under which the financing and delivery of medical care is provided, in whole or in
1356 part, through a defined set of providers under contract with the insurer, including the financing
1357 and delivery of an item paid for as medical care.
1358 [
1359 with a managed care organization to provide health care services to an enrollee with an
1360 expectation of receiving payment, other than coinsurance, copayments, or deductibles, directly
1361 from the managed care organization.
1362 [
1363 not entitled to receive a dividend representing a share of the surplus of the insurer.
1364 [
1365 (a) ships or hulls of ships;
1366 (b) goods, freight, cargoes, merchandise, effects, disbursements, profits, money,
1367 securities, choses in action, evidences of debt, valuable papers, bottomry, respondentia
1368 interests, or other cargoes in or awaiting transit over the oceans or inland waterways;
1369 (c) earnings such as freight, passage money, commissions, or profits derived from
1370 transporting goods or people upon or across the oceans or inland waterways; or
1371 (d) a vessel owner or operator as a result of liability to employees, passengers, bailors,
1372 owners of other vessels, owners of fixed objects, customs or other authorities, or other persons
1373 in connection with maritime activity.
1374 [
1375 [
1376 health insurance policy.
1377 [
1378 entitled to receive a dividend representing a share of the surplus of the insurer.
1379 [
1380 relating to the minimum percentage of eligible employees that must be enrolled in relation to
1381 the total number of eligible employees of an employer reduced by each eligible employee who
1382 voluntarily declines coverage under the plan because the employee:
1383 (a) has other group health care insurance coverage; or
1384 (b) receives:
1385 (i) Medicare, under the Health Insurance for the Aged Act, Title XVIII of the Social
1386 Security Amendments of 1965; or
1387 (ii) another government health benefit.
1388 [
1389 (a) an individual;
1390 (b) a partnership;
1391 (c) a corporation;
1392 (d) an incorporated or unincorporated association;
1393 (e) a joint stock company;
1394 (f) a trust;
1395 (g) a limited liability company;
1396 (h) a reciprocal;
1397 (i) a syndicate; or
1398 (j) another similar entity or combination of entities acting in concert.
1399 [
1400 coverage sold for primarily noncommercial purposes to:
1401 (a) an individual; or
1402 (b) a family.
1403 [
1404 1002(16)(B).
1405 [
1406 (a) the year that is designated as the plan year in:
1407 (i) the plan document of a group health plan; or
1408 (ii) a summary plan description of a group health plan;
1409 (b) if the plan document or summary plan description does not designate a plan year or
1410 there is no plan document or summary plan description:
1411 (i) the year used to determine deductibles or limits;
1412 (ii) the policy year, if the plan does not impose deductibles or limits on a yearly basis;
1413 or
1414 (iii) the employer's taxable year if:
1415 (A) the plan does not impose deductibles or limits on a yearly basis; and
1416 (B) (I) the plan is not insured; or
1417 (II) the insurance policy is not renewed on an annual basis; or
1418 (c) in a case not described in Subsection [
1419 [
1420 application that:
1421 (i) purports to be an enforceable contract; and
1422 (ii) memorializes in writing some or all of the terms of an insurance contract.
1423 (b) "Policy" includes a service contract issued by:
1424 (i) a motor club under Chapter 11, Motor Clubs;
1425 (ii) a service contract provided under Chapter 6a, Service Contracts; and
1426 (iii) a corporation licensed under:
1427 (A) Chapter 7, Nonprofit Health Service Insurance Corporations; or
1428 (B) Chapter 8, Health Maintenance Organizations and Limited Health Plans.
1429 (c) "Policy" does not include:
1430 (i) a certificate under a group insurance contract; or
1431 (ii) a document that does not purport to have legal effect.
1432 [
1433 contract by ownership, premium payment, or otherwise.
1434 [
1435 nonguaranteed elements of a policy of life insurance over a period of years.
1436 [
1437 insurance policy.
1438 [
1439 No. 111-148 and the Health Care Education Reconciliation Act of 2010, Pub. L. No. 111-152,
1440 and related federal regulations and guidance.
1441 [
1442 insurance:
1443 (a) means a condition that was present before the effective date of coverage, whether or
1444 not medical advice, diagnosis, care, or treatment was recommended or received before that day;
1445 and
1446 (b) does not include a condition indicated by genetic information unless an actual
1447 diagnosis of the condition by a physician has been made.
1448 [
1449 (b) "Premium" includes, however designated:
1450 (i) an assessment;
1451 (ii) a membership fee;
1452 (iii) a required contribution; or
1453 (iv) monetary consideration.
1454 (c) (i) "Premium" does not include consideration paid to a third party administrator for
1455 the third party administrator's services.
1456 (ii) "Premium" includes an amount paid by a third party administrator to an insurer for
1457 insurance on the risks administered by the third party administrator.
1458 [
1459 Subsection 31A-5-203(3).
1460 [
1461 [
1462 incident to the practice of a profession and provision of a professional service.
1463 [
1464 insurance" means insurance against loss or damage to real or personal property of every kind
1465 and any interest in that property:
1466 (i) from all hazards or causes; and
1467 (ii) against loss consequential upon the loss or damage including vehicle
1468 comprehensive and vehicle physical damage coverages.
1469 (b) "Property insurance" does not include:
1470 (i) inland marine insurance; and
1471 (ii) ocean marine insurance.
1472 [
1473 long-term care insurance contract" means:
1474 (a) an individual or group insurance contract that meets the requirements of Section
1475 7702B(b), Internal Revenue Code; or
1476 (b) the portion of a life insurance contract that provides long-term care insurance:
1477 (i) (A) by rider; or
1478 (B) as a part of the contract; and
1479 (ii) that satisfies the requirements of Sections 7702B(b) and (e), Internal Revenue
1480 Code.
1481 [
1482 (a) is:
1483 (i) organized under the laws of the United States or any state; or
1484 (ii) in the case of a United States office of a foreign banking organization, licensed
1485 under the laws of the United States or any state;
1486 (b) is regulated, supervised, and examined by a United States federal or state authority
1487 having regulatory authority over a bank or trust company; and
1488 (c) meets the standards of financial condition and standing that are considered
1489 necessary and appropriate to regulate the quality of a financial institution whose letters of credit
1490 will be acceptable to the commissioner as determined by:
1491 (i) the commissioner by rule; or
1492 (ii) the Securities Valuation Office of the National Association of Insurance
1493 Commissioners.
1494 [
1495 (i) the cost of a given unit of insurance; or
1496 (ii) for property or casualty insurance, that cost of insurance per exposure unit either
1497 expressed as:
1498 (A) a single number; or
1499 (B) a pure premium rate, adjusted before the application of individual risk variations
1500 based on loss or expense considerations to account for the treatment of:
1501 (I) expenses;
1502 (II) profit; and
1503 (III) individual insurer variation in loss experience.
1504 (b) "Rate" does not include a minimum premium.
1505 [
1506 organization" means a person who assists an insurer in rate making or filing by:
1507 (i) collecting, compiling, and furnishing loss or expense statistics;
1508 (ii) recommending, making, or filing rates or supplementary rate information; or
1509 (iii) advising about rate questions, except as an attorney giving legal advice.
1510 (b) "Rate service organization" does not mean:
1511 (i) an employee of an insurer;
1512 (ii) a single insurer or group of insurers under common control;
1513 (iii) a joint underwriting group; or
1514 (iv) an individual serving as an actuarial or legal consultant.
1515 [
1516 renewal policy premiums:
1517 (a) a manual of rates;
1518 (b) a classification;
1519 (c) a rate-related underwriting rule; and
1520 (d) a rating formula that describes steps, policies, and procedures for determining
1521 initial and renewal policy premiums.
1522 [
1523 pay, allow, or give, directly or indirectly:
1524 (i) a refund of premium or portion of premium;
1525 (ii) a refund of commission or portion of commission;
1526 (iii) a refund of all or a portion of a consultant fee; or
1527 (iv) providing services or other benefits not specified in an insurance or annuity
1528 contract.
1529 (b) "Rebate" does not include:
1530 (i) a refund due to termination or changes in coverage;
1531 (ii) a refund due to overcharges made in error by the licensee; or
1532 (iii) savings or wellness benefits as provided in the contract by the licensee.
1533 [
1534 (a) the date delivered to and stamped received by the department, if delivered in
1535 person;
1536 (b) the post mark date, if delivered by mail;
1537 (c) the delivery service's post mark or pickup date, if delivered by a delivery service;
1538 (d) the received date recorded on an item delivered, if delivered by:
1539 (i) facsimile;
1540 (ii) email; or
1541 (iii) another electronic method; or
1542 (e) a date specified in:
1543 (i) a statute;
1544 (ii) a rule; or
1545 (iii) an order.
1546 [
1547 association of persons:
1548 (a) operating through an attorney-in-fact common to all of the persons; and
1549 (b) exchanging insurance contracts with one another that provide insurance coverage
1550 on each other.
1551 [
1552 consideration, transfers any portion of the risk it has assumed to another insurer. In referring to
1553 reinsurance transactions, this title sometimes refers to:
1554 (a) the insurer transferring the risk as the "ceding insurer"; and
1555 (b) the insurer assuming the risk as the:
1556 (i) "assuming insurer"; or
1557 (ii) "assuming reinsurer."
1558 [
1559 authority to assume reinsurance.
1560 [
1561 liability resulting from or incident to the ownership, maintenance, or use of a residential
1562 dwelling that is a detached single family residence or multifamily residence up to four units.
1563 [
1564 assumed under a reinsurance contract.
1565 (b) A reinsurer "retrocedes" when the reinsurer reinsures with another insurer part of a
1566 liability assumed under a reinsurance contract.
1567 [
1568 (a) an insurance policy; or
1569 (b) an insurance certificate.
1570 [
1571 exclusion from coverage in accident and health insurance.
1572 [
1573 (i) note;
1574 (ii) stock;
1575 (iii) bond;
1576 (iv) debenture;
1577 (v) evidence of indebtedness;
1578 (vi) certificate of interest or participation in a profit-sharing agreement;
1579 (vii) collateral-trust certificate;
1580 (viii) preorganization certificate or subscription;
1581 (ix) transferable share;
1582 (x) investment contract;
1583 (xi) voting trust certificate;
1584 (xii) certificate of deposit for a security;
1585 (xiii) certificate of interest of participation in an oil, gas, or mining title or lease or in
1586 payments out of production under such a title or lease;
1587 (xiv) commodity contract or commodity option;
1588 (xv) certificate of interest or participation in, temporary or interim certificate for,
1589 receipt for, guarantee of, or warrant or right to subscribe to or purchase any of the items listed
1590 in Subsections [
1591 (xvi) another interest or instrument commonly known as a security.
1592 (b) "Security" does not include:
1593 (i) any of the following under which an insurance company promises to pay money in a
1594 specific lump sum or periodically for life or some other specified period:
1595 (A) insurance;
1596 (B) an endowment policy; or
1597 (C) an annuity contract; or
1598 (ii) a burial certificate or burial contract.
1599 [
1600 person, including:
1601 (a) common stock;
1602 (b) preferred stock;
1603 (c) debt obligations; and
1604 (d) any other security convertible into or evidencing the right of any of the items listed
1605 in this Subsection [
1606 [
1607 provides for spreading its own risks by a systematic plan.
1608 (b) Except as provided in this Subsection [
1609 include an arrangement under which a number of persons spread their risks among themselves.
1610 (c) "Self-insurance" includes:
1611 (i) an arrangement by which a governmental entity undertakes to indemnify an
1612 employee for liability arising out of the employee's employment; and
1613 (ii) an arrangement by which a person with a managed program of self-insurance and
1614 risk management undertakes to indemnify its affiliates, subsidiaries, directors, officers, or
1615 employees for liability or risk that is related to the relationship or employment.
1616 (d) "Self-insurance" does not include an arrangement with an independent contractor.
1617 [
1618 (a) by any means;
1619 (b) for money or its equivalent; and
1620 (c) on behalf of an insurance company.
1621 [
1622 advertised, marketed, offered, or designed to provide coverage that is similar to long-term care
1623 insurance, but that provides coverage for less than 12 consecutive months for each covered
1624 person.
1625 [
1626 during each of which an individual does not have creditable coverage.
1627 [
1628 with respect to a calendar year and to a plan year, an employer who:
1629 (i) (A) employed at least one [
1630 business days during the preceding calendar year; [
1631 (B) if the employer did not exist for the entirety of the preceding calendar year,
1632 reasonably expects to employ an average of at least one but not more than 50 eligible
1633 employees on business days during the current calendar year;
1634 (ii) employs at least one employee on the first day of the plan year[
1635 [
1636 [
1637 [
1638 (iii) for an employer who has common ownership with one or more other employers, is
1639 treated as a single employer under 26 U.S.C. Sec. 414(b), (c), (m), or (o).
1640 [
1641 least one employee.
1642 [
1643 the same meaning as provided in federal regulations adopted pursuant to the Health Insurance
1644 Portability and Accountability Act.
1645 [
1646 either directly or indirectly through one or more affiliates or intermediaries.
1647 (b) "Wholly owned subsidiary" of a person is a subsidiary of which all of the voting
1648 shares are owned by that person either alone or with its affiliates, except for the minimum
1649 number of shares the law of the subsidiary's domicile requires to be owned by directors or
1650 others.
1651 [
1652 (a) a guarantee against loss or damage resulting from the failure of a principal to pay or
1653 perform the principal's obligations to a creditor or other obligee;
1654 (b) bail bond insurance; and
1655 (c) fidelity insurance.
1656 [
1657 and liabilities.
1658 (b) (i) "Permanent surplus" means the surplus of an insurer or organization that is
1659 designated by the insurer or organization as permanent.
1660 (ii) Sections 31A-5-211, 31A-7-201, 31A-8-209, 31A-9-209, and 31A-14-205 require
1661 that insurers or organizations doing business in this state maintain specified minimum levels of
1662 permanent surplus.
1663 (iii) Except for assessable mutuals, the minimum permanent surplus requirement is the
1664 same as the minimum required capital requirement that applies to stock insurers.
1665 (c) "Excess surplus" means:
1666 (i) for a life insurer, accident and health insurer, health organization, or property and
1667 casualty insurer as defined in Section 31A-17-601, the lesser of:
1668 (A) that amount of an insurer's or health organization's total adjusted capital that
1669 exceeds the product of:
1670 (I) 2.5; and
1671 (II) the sum of the insurer's or health organization's minimum capital or permanent
1672 surplus required under Section 31A-5-211, 31A-9-209, or 31A-14-205; or
1673 (B) that amount of an insurer's or health organization's total adjusted capital that
1674 exceeds the product of:
1675 (I) 3.0; and
1676 (II) the authorized control level RBC as defined in Subsection 31A-17-601(8)(a); and
1677 (ii) for a monoline mortgage guaranty insurer, financial guaranty insurer, or title insurer
1678 that amount of an insurer's paid-in-capital and surplus that exceeds the product of:
1679 (A) 1.5; and
1680 (B) the insurer's total adjusted capital required by Subsection 31A-17-609(1).
1681 [
1682 collects charges or premiums from, or who, for consideration, adjusts or settles claims of
1683 residents of the state in connection with insurance coverage, annuities, or service insurance
1684 coverage, except:
1685 (a) a union on behalf of its members;
1686 (b) a person administering a:
1687 (i) pension plan subject to the federal Employee Retirement Income Security Act of
1688 1974;
1689 (ii) governmental plan as defined in Section 414(d), Internal Revenue Code; or
1690 (iii) nonelecting church plan as described in Section 410(d), Internal Revenue Code;
1691 (c) an employer on behalf of the employer's employees or the employees of one or
1692 more of the subsidiary or affiliated corporations of the employer;
1693 (d) an insurer licensed under the following, but only for a line of insurance for which
1694 the insurer holds a license in this state:
1695 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
1696 (ii) Chapter 7, Nonprofit Health Service Insurance Corporations;
1697 (iii) Chapter 8, Health Maintenance Organizations and Limited Health Plans;
1698 (iv) Chapter 9, Insurance Fraternals; or
1699 (v) Chapter 14, Foreign Insurers;
1700 (e) a person:
1701 (i) licensed or exempt from licensing under:
1702 (A) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
1703 Reinsurance Intermediaries; or
1704 (B) Chapter 26, Insurance Adjusters; and
1705 (ii) whose activities are limited to those authorized under the license the person holds
1706 or for which the person is exempt; or
1707 (f) an institution, bank, or financial institution:
1708 (i) that is:
1709 (A) an institution whose deposits and accounts are to any extent insured by a federal
1710 deposit insurance agency, including the Federal Deposit Insurance Corporation or National
1711 Credit Union Administration; or
1712 (B) a bank or other financial institution that is subject to supervision or examination by
1713 a federal or state banking authority; and
1714 (ii) that does not adjust claims without a third party administrator license.
1715 [
1716 owner of real or personal property or the holder of liens or encumbrances on that property, or
1717 others interested in the property against loss or damage suffered by reason of liens or
1718 encumbrances upon, defects in, or the unmarketability of the title to the property, or invalidity
1719 or unenforceability of any liens or encumbrances on the property.
1720 [
1721 organization's statutory capital and surplus as determined in accordance with:
1722 (a) the statutory accounting applicable to the annual financial statements required to be
1723 filed under Section 31A-4-113; and
1724 (b) another item provided by the RBC instructions, as RBC instructions is defined in
1725 Section 31A-17-601.
1726 [
1727 a corporation.
1728 (b) "Trustee," when used in reference to an employee welfare fund, means an
1729 individual, firm, association, organization, joint stock company, or corporation, whether acting
1730 individually or jointly and whether designated by that name or any other, that is charged with
1731 or has the overall management of an employee welfare fund.
1732 [
1733 insurer" means an insurer:
1734 (i) not holding a valid certificate of authority to do an insurance business in this state;
1735 or
1736 (ii) transacting business not authorized by a valid certificate.
1737 (b) "Admitted insurer" or "authorized insurer" means an insurer:
1738 (i) holding a valid certificate of authority to do an insurance business in this state; and
1739 (ii) transacting business as authorized by a valid certificate.
1740 [
1741 insurer.
1742 [
1743 from or incident to ownership, maintenance, or use of a land vehicle or aircraft, exclusive of a
1744 vehicle comprehensive or vehicle physical damage coverage under Subsection [
1745 [
1746 security convertible into a security with a voting right associated with the security.
1747 [
1748 pass before coverage for an individual, who is otherwise eligible to enroll under the terms of
1749 the health benefit plan, can become effective.
1750 [
1751 (a) insurance for indemnification of an employer against liability for compensation
1752 based on:
1753 (i) a compensable accidental injury; and
1754 (ii) occupational disease disability;
1755 (b) employer's liability insurance incidental to workers' compensation insurance and
1756 written in connection with workers' compensation insurance; and
1757 (c) insurance assuring to a person entitled to workers' compensation benefits the
1758 compensation provided by law.
1759 Section 6. Section 31A-2-201.1 is amended to read:
1760 31A-2-201.1. General filing requirements.
1761 Except as otherwise provided in this title, the commissioner may set by rule made in
1762 accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, specific
1763 requirements for filing any of the following required by this title:
1764 (1) a form;
1765 (2) a rate; [
1766 (3) a report[
1767 (4) a binder for a health benefit plan or dental policy.
1768 Section 7. Section 31A-2-201.2 is amended to read:
1769 31A-2-201.2. Evaluation of health insurance market.
1770 (1) Each year the commissioner shall:
1771 (a) conduct an evaluation of the state's health insurance market;
1772 (b) report the findings of the evaluation to the Health and Human Services Interim
1773 Committee before [
1774 (c) publish the findings of the evaluation on the department website.
1775 (2) The evaluation required by this section shall:
1776 (a) analyze the effectiveness of the insurance regulations and statutes in promoting a
1777 healthy, competitive health insurance market that meets the needs of the state, and includes an
1778 analysis of:
1779 (i) the availability and marketing of individual and group products;
1780 (ii) rate changes;
1781 (iii) coverage and demographic changes;
1782 (iv) benefit trends;
1783 (v) market share changes; and
1784 (vi) accessibility;
1785 (b) assess complaint ratios and trends within the health insurance market, which
1786 assessment shall include complaint data from the Office of Consumer Health Assistance within
1787 the department;
1788 (c) contain recommendations for action to improve the overall effectiveness of the
1789 health insurance market, administrative rules, and statutes; and
1790 (d) include claims loss ratio data for each health insurance company doing business in
1791 the state.
1792 (3) When preparing the evaluation and report required by this section, the
1793 commissioner may seek the input of insurers, employers, insured persons, providers, and others
1794 with an interest in the health insurance market.
1795 (4) The commissioner may adopt administrative rules for the purpose of collecting the
1796 data required by this section, taking into account the business confidentiality of the insurers.
1797 (5) Records submitted to the commissioner under this section shall be maintained by
1798 the commissioner as protected records under Title 63G, Chapter 2, Government Records
1799 Access and Management Act.
1800 Section 8. Section 31A-2-204 is amended to read:
1801 31A-2-204. Conducting examinations.
1802 (1) As used in this section, "work papers" means a record that is created or relied upon:
1803 (a) during the course of an examination conducted under Section 31A-2-203; or
1804 (b) in drafting an examination report.
1805 [
1806 issue an order:
1807 (i) stating the scope of the examination; and
1808 (ii) designating the examiner in charge.
1809 (b) The commissioner need not give advance notice of an examination to an examinee.
1810 (c) The examiner in charge shall give the examinee a copy of the order issued under
1811 this Subsection [
1812 (d) (i) The commissioner may alter the scope or nature of an examination at any time
1813 without advance notice to the examinee.
1814 (ii) If the commissioner amends an order described in this Subsection [
1815 commissioner shall provide a copy of any amended order to the examinee.
1816 (e) Statements in the commissioner's examination order concerning examination scope
1817 are for the examiner's guidance only.
1818 (f) Examining relevant matters not mentioned in an order issued under this Subsection
1819 [
1820 [
1821 regulators of other states by conducting joint examinations of:
1822 (a) multistate insurers doing business in this state; or
1823 (b) other multistate licensees doing business in this state.
1824 [
1825 purposes of the examination, have access at all reasonable hours to the premises and to any
1826 books, records, files, securities, documents, or property of:
1827 (a) the examinee; and
1828 (b) any of the following if the premises, books, records, files, securities, documents, or
1829 property relate to the affairs of the examinee:
1830 (i) an officer of the examinee;
1831 (ii) any other person who:
1832 (A) has executive authority over the examinee; or
1833 (B) is in charge of any segment of the examinee's affairs; or
1834 (iii) any affiliate of the examinee under Subsection 31A-2-203(1)(b).
1835 [
1836 Subsection 31A-2-203(1)(b) shall comply with every reasonable request of the examiners for
1837 assistance in any matter relating to the examination.
1838 (b) A person may not obstruct or interfere with the examination except by legal
1839 process.
1840 [
1841 examination of the condition and affairs of the examinee or improperly kept or posted, the
1842 commissioner may employ experts to rewrite, post, or balance the accounts or records at the
1843 expense of the examinee.
1844 [
1845 examination no later than 60 days after the completion of the examination that shall include:
1846 (i) the information and analysis ordered under Subsection [
1847 (ii) the examiner's recommendations.
1848 (b) At the option of the examiner in charge, preparation of the report may include
1849 conferences with the examinee or representatives of the examinee.
1850 (c) The report is confidential until the report becomes a public document under
1851 Subsection [
1852 for action under Chapter 27a, Insurer Receivership Act.
1853 [
1854 in Subsection [
1855 (b) Within 20 days after service, the examinee shall:
1856 (i) accept the examination report as written; or
1857 (ii) request agency action to modify the examination report.
1858 (c) The report is considered accepted under this Subsection [
1859 does not file a request for agency action to modify the report within 20 days after service of the
1860 report.
1861 (d) If the examination report is accepted:
1862 (i) the examination report immediately becomes a public document; and
1863 (ii) the commissioner shall distribute the examination report to all jurisdictions in
1864 which the examinee is authorized to do business.
1865 (e) (i) Any adjudicative proceeding held as a result of the examinee's request for
1866 agency action shall, upon the examinee's demand, be closed to the public, except that the
1867 commissioner need not exclude any participating examiner from this closed hearing.
1868 (ii) Within 20 days after the hearing held under this Subsection [
1869 commissioner shall:
1870 (A) adopt the examination report with any necessary modifications; and
1871 (B) serve a copy of the adopted report upon the examinee.
1872 (iii) Unless the examinee seeks judicial relief, the adopted examination report:
1873 (A) shall become a public document 10 days after service; and
1874 (B) may be distributed as described in this section.
1875 (f) Notwithstanding Title 63G, Chapter 4, Administrative Procedures Act, to the extent
1876 that this section is in conflict with Title 63G, Chapter 4, Administrative Procedures Act, this
1877 section governs:
1878 (i) a request for agency action under this section; or
1879 (ii) adjudicative proceeding under this section.
1880 [
1881 described in Subsection [
1882 [
1883 [
1884 31A-3-103, a copy of the examination report to interested persons, including:
1885 (a) a member of the board of the examinee; or
1886 (b) one or more newspapers in this state.
1887 [
1888 examinee, the examination report as adopted by the commissioner is admissible as evidence of
1889 the facts stated in the report.
1890 (b) In any proceeding commenced under Chapter 27a, Insurer Receivership Act, the
1891 examination report, whether adopted by the commissioner or not, is admissible as evidence of
1892 the facts stated in the examination report.
1893 (12) Work papers are protected records under Title 63G, Chapter 2, Government
1894 Records Access and Management Act.
1895 Section 9. Section 31A-2-403 is amended to read:
1896 31A-2-403. Title and Escrow Commission created.
1897 (1) (a) Subject to Subsection (1)(b), there is created within the department the Title and
1898 Escrow Commission that is comprised of five members appointed by the governor with the
1899 consent of the Senate as follows:
1900 (i) except as provided in Subsection (1)(c), two members shall be employees of a title
1901 insurer;
1902 (ii) two members shall:
1903 (A) be employees of a Utah agency title insurance producer;
1904 (B) be or have been licensed under the title insurance line of authority;
1905 (C) as of the day on which the member is appointed, be or have been licensed with the
1906 title examination or escrow subline of authority for at least five years; and
1907 (D) as of the day on which the member is appointed, not be from the same county as
1908 another member appointed under this Subsection (1)(a)(ii); and
1909 (iii) one member shall be a member of the general public from any county in the state.
1910 (b) No more than one commission member may be appointed from a single company
1911 or an affiliate or subsidiary of the company.
1912 (c) If the governor is unable to identify more than one individual who is an employee
1913 of a title insurer and willing to serve as a member of the commission, the commission shall
1914 include the following members in lieu of the members described in Subsection (1)(a)(i):
1915 (i) one member who is an employee of a title insurer; and
1916 (ii) one member who is an employee of a Utah agency title insurance producer.
1917 (2) (a) Subject to Subsection (2)(c), a commission member shall file with the
1918 commissioner a disclosure of any position of employment or ownership interest that the
1919 commission member has with respect to a person that is subject to the jurisdiction of the
1920 commissioner.
1921 (b) The disclosure statement required by this Subsection (2) shall be:
1922 (i) filed by no later than the day on which the person begins that person's appointment;
1923 and
1924 (ii) amended when a significant change occurs in any matter required to be disclosed
1925 under this Subsection (2).
1926 (c) A commission member is not required to disclose an ownership interest that the
1927 commission member has if the ownership interest is in a publicly traded company or held as
1928 part of a mutual fund, trust, or similar investment.
1929 (3) (a) Except as required by Subsection (3)(b), as terms of current commission
1930 members expire, the governor shall appoint each new commission member to a four-year term
1931 ending on June 30.
1932 (b) Notwithstanding the requirements of Subsection (3)(a), the governor shall, at the
1933 time of appointment, adjust the length of terms to ensure that the terms of the commission
1934 members are staggered so that approximately half of the members appointed under Subsection
1935 (1)(a)(i) and half of the members appointed under Subsection (1)(a)(ii) are appointed every two
1936 years.
1937 (c) A commission member may not serve more than one consecutive term.
1938 (d) When a vacancy occurs in the membership for any reason, the governor, with the
1939 consent of the Senate, shall appoint a replacement for the unexpired term.
1940 (e) Notwithstanding the other provisions of this Subsection (3), a commission member
1941 serves until a successor is appointed by the governor with the consent of the Senate.
1942 (4) A commission member may not receive compensation or benefits for the
1943 commission member's service, but may receive per diem and travel expenses in accordance
1944 with:
1945 (a) Section 63A-3-106;
1946 (b) Section 63A-3-107; and
1947 (c) rules made by the Division of Finance pursuant to Sections 63A-3-106 and
1948 63A-3-107.
1949 (5) Members of the commission shall annually select one commission member to serve
1950 as chair.
1951 (6) (a) The commission shall meet at least monthly. Notwithstanding Section
1952 52-4-207, a commission member shall physically attend a regularly scheduled monthly meeting
1953 of the commission and may not attend through electronic means. A commission member may
1954 attend subcommittee meetings, emergency meetings, or other not regularly scheduled meetings
1955 electronically in accordance with Section 52-4-207.
1956 (b) The commissioner may call additional meetings:
1957 (i) at the commissioner's discretion;
1958 (ii) upon the request of the chair of the commission; or
1959 (iii) upon the written request of three or more commission members.
1960 (c) (i) Three commission members constitute a quorum for the transaction of business.
1961 (ii) The action of a majority of the commission members when a quorum is present is
1962 the action of the commission.
1963 (7) The commissioner shall staff the commission.
1964 Section 10. Section 31A-3-303 is amended to read:
1965 31A-3-303. Payment of tax.
1966 (1) (a) An insurer, the producers involved in the transaction, and the policyholder are
1967 jointly and severally liable for the payment of the taxes required under Section 31A-3-301.
1968 (b) The policyholder's liability for payment of the premium tax under Section
1969 31A-3-301 ends when the policyholder pays the tax to a producer or an insurer.
1970 (c) The insurer and the producers involved in the transaction are jointly and severally
1971 liable for the payment of the additional tax required under Section 31A-3-302.
1972 (d) Except for the tax under Section 31A-3-302, the policyholder shall pay a tax under
1973 this part and shall be billed specifically for the tax when billed for the premium.
1974 (e) Except for the tax imposed under Section 31A-3-302, absorption of the tax by the
1975 producer or insurer is an unfair method of competition under Sections 31A-23a-402 and
1976 31A-23a-402.5.
1977 (2) (a) The commissioner shall by rule prescribe accounting and reporting forms and
1978 procedures for insurers, producers, and policyholders to use in determining the amount of taxes
1979 owed under this part, and the manner and time of payment.
1980 (b) If a tax is not paid within the time prescribed under the commissioner's rule, a
1981 penalty shall be imposed of 25% of the tax due, plus 1-1/2% per month from the time of
1982 default until full payment of the tax.
1983 (3) Upon making a record of its actions, and upon reasonable cause shown, the
1984 commissioner may waive, reduce, or compromise any of the penalties or interest imposed
1985 under this part.
1986 [
1987
1988
1989
1990
1991
1992
1993 (4) When Utah is the home state, premiums for surplus lines insurance are taxable in
1994 full.
1995 (5) Subject to Section 31A-3-305, the premium taxes collected under this part by a
1996 producer or by an insurer are the property of this state.
1997 (6) If the property of a producer is seized under any process in a court in this state, or if
1998 a producer's business is suspended by the action of creditors or put into the hands of an
1999 assignee, receiver, or trustee, the taxes and penalties due this state under this part are preferred
2000 claims and the state is to that extent a preferred creditor.
2001 Section 11. Section 31A-3-304 is amended to read:
2002 31A-3-304. Annual fees -- Other taxes or fees prohibited -- Captive Insurance
2003 Restricted Account.
2004 (1) (a) A captive insurance company shall pay an annual fee imposed under this section
2005 to obtain or renew a certificate of authority.
2006 (b) The commissioner shall:
2007 (i) determine the annual fee pursuant to Section 31A-3-103; and
2008 (ii) consider whether the annual fee is competitive with fees imposed by other states on
2009 captive insurance companies.
2010 (2) A captive insurance company that fails to pay the fee required by this section is
2011 subject to the relevant sanctions of this title.
2012 (3) (a) A captive insurance company that pays one of the following fees is exempt from
2013 Title 59, Chapter 7, Corporate Franchise and Income Taxes, and Title 59, Chapter 9, Taxation
2014 of Admitted Insurers:
2015 (i) a fee under this section;
2016 (ii) a fee under Chapter 37, Captive Insurance Companies Act; or
2017 (iii) a fee under Chapter 37a, Special Purpose Financial Captive Insurance Company
2018 Act.
2019 (b) The state or a county, city, or town within the state may not levy or collect an
2020 occupation tax or other fee or charge not described in Subsections (3)(a)(i) through (iii) against
2021 a captive insurance company.
2022 (c) The state may not levy, assess, or collect a withdrawal fee under Section 31A-4-115
2023 against a captive insurance company.
2024 (4) A captive insurance company shall pay the fee imposed by this section to the
2025 commissioner by June 1 of each year.
2026 (5) (a) Money received pursuant to a fee described in Subsection (3)(a) shall be
2027 deposited into the Captive Insurance Restricted Account.
2028 (b) There is created in the General Fund a restricted account known as the "Captive
2029 Insurance Restricted Account."
2030 (c) The Captive Insurance Restricted Account shall consist of the fees described in
2031 Subsection (3)(a).
2032 (d) The commissioner shall administer the Captive Insurance Restricted Account.
2033 Subject to appropriations by the Legislature, the commissioner shall use the money deposited
2034 into the Captive Insurance Restricted Account to:
2035 (i) administer and enforce:
2036 (A) Chapter 37, Captive Insurance Companies Act; and
2037 (B) Chapter 37a, Special Purpose Financial Captive Insurance Company Act; and
2038 (ii) promote the captive insurance industry in Utah.
2039 (e) An appropriation from the Captive Insurance Restricted Account is nonlapsing,
2040 except that at the end of each fiscal year, money received by the commissioner in excess of the
2041 following shall be treated as free revenue in the General Fund:
2042 [
2043 [
2044 [
2045 $1,850,000[
2046 (ii) for fiscal year 2018-2019 and subsequent fiscal years, in excess of $1,600,000.
2047 Section 12. Section 31A-6a-101 is amended to read:
2048 31A-6a-101. Definitions.
2049 As used in this chapter:
2050 (1) (a) "Incidental cost" means a cost, incurred by a warranty holder in relation to a
2051 vehicle protection product warranty, that is in addition to the cost of purchasing the warranty.
2052 (b) "Incidental cost" includes an insurance policy deductible, a rental vehicle charge,
2053 the difference between the actual value of the stolen vehicle at the time of theft and the cost of
2054 a replacement vehicle, sales tax, a registration fee, a transaction fee, a mechanical inspection
2055 fee, or damage a theft causes to a vehicle.
2056 [
2057 issued by an insurance company that has complied with either Chapter 5, Domestic Stock and
2058 Mutual Insurance Corporations, or Chapter 14, Foreign Insurers, that undertakes to perform or
2059 provide repair or replacement service on goods or property, or indemnification for repair or
2060 replacement service, for the operational or structural failure of the goods or property due to a
2061 defect in materials, workmanship, or normal wear and tear.
2062 [
2063 original manufacturer of the goods commonly referred to as "after market parts."
2064 [
2065 vehicle.
2066 (b) "Road hazard" includes potholes, rocks, wood debris, metal parts, glass, plastic,
2067 curbs, or composite scraps.
2068 [
2069 for the repair or maintenance of goods or property, for their operational or structural failure due
2070 to a defect in materials, workmanship, normal wear and tear, power surge or interruption, or
2071 accidental damage from handling, with or without additional provision for incidental payment
2072 of indemnity under limited circumstances, including towing, providing a rental car, providing
2073 emergency road service, and covering food spoilage.
2074 (b) "Service contract" does not include:
2075 (i) mechanical breakdown insurance; or
2076 (ii) a prepaid contract of limited duration that provides for scheduled maintenance
2077 only, regardless of whether the contract is executed before, on, or after May 9, 2017.
2078 (c) "Service contract" includes any contract or agreement to perform or reimburse the
2079 service contract holder for any one or more of the following services:
2080 (i) the repair or replacement of tires, wheels, or both on a motor vehicle damaged as a
2081 result of coming into contact with a road hazard;
2082 (ii) the removal of dents, dings, or creases on a motor vehicle that can be repaired using
2083 the process of paintless dent removal without affecting the existing paint finish and without
2084 replacing vehicle body panels, sanding, bonding, or painting;
2085 (iii) the repair of chips or cracks in or the replacement of a motor vehicle windshield as
2086 a result of damage caused by a road hazard, that is primary to the coverage offered by the motor
2087 vehicle owner's motor vehicle insurance policy; or
2088 (iv) the replacement of a motor vehicle key or key-fob if the key or key-fob becomes
2089 inoperable, lost, or stolen, except that the replacement of lost or stolen property is limited to
2090 only the replacement of a lost or stolen motor vehicle key or key-fob.
2091 [
2092 service contract.
2093 [
2094 administers, sells or offers to sell a service contract, or who is contractually obligated to
2095 provide service under a service contract.
2096 [
2097 means a policy of insurance providing coverage for all obligations and liabilities incurred by
2098 the service contract provider or warrantor under the terms of the service contract or vehicle
2099 protection product warranty issued by the provider or warrantor.
2100 [
2101 (i) installed on or applied to a motor vehicle; and
2102 (ii) designed to:
2103 (A) prevent the theft of the vehicle[
2104 (B) if the vehicle is stolen, aid in the recovery of the vehicle.
2105 (b) "Vehicle protection product" includes:
2106 (i) a vehicle protection product warranty;
2107 (ii) an alarm system;
2108 (iii) a body part marking product;
2109 (iv) a steering lock;
2110 (v) a window etch product;
2111 (vi) a pedal and ignition lock;
2112 (vii) a fuel and ignition kill switch; and
2113 (viii) an electronic, radio, or satellite tracking device.
2114 [
2115 warrantor that provides that if the vehicle protection product fails to prevent the theft of the
2116 motor vehicle, [
2117 in the warranty, not exceeding 30 days after the day on which the motor vehicle is reported
2118 stolen, the warrantor will reimburse the warranty holder [
2119 for incidental costs specified in the warranty, not [
2120 specified fixed amount not exceeding $5,000.
2121 [
2122 holder under the terms of a vehicle protection product warranty.
2123 [
2124 product, any authorized transferee or assignee of the purchaser, or any other person legally
2125 assuming the purchaser's rights under the vehicle protection product warranty.
2126 Section 13. Section 31A-6a-104 is amended to read:
2127 31A-6a-104. Required disclosures.
2128 (1) A [
2129 vehicle protection product warranty that is issued, sold, or offered for sale in this state shall
2130 conspicuously state that, upon failure of the service contract provider or warrantor to perform
2131 under the contract, the issuer of the policy shall:
2132 (a) pay on behalf of the service contract provider or warrantor any sums the service
2133 contract provider or warrantor is legally obligated to pay according to the service contract
2134 provider's or warrantor's contractual obligations under the service contract or a vehicle
2135 protection product warranty issued or sold by the service contract provider or warrantor; or
2136 (b) provide the service which the service contract provider is legally obligated to
2137 perform, according to the service contract provider's contractual obligations under the service
2138 contract issued or sold by the service contract provider.
2139 (2) (a) A service contract may not be issued, sold, or offered for sale in this state unless
2140 the service contract contains the following statements in substantially the following form:
2141 (i) "Obligations of the provider under this service contract are guaranteed under a
2142 service contract reimbursement insurance policy. Should the provider fail to pay or provide
2143 service on any claim within 60 days after proof of loss has been filed, the contract holder is
2144 entitled to make a claim directly against the Insurance Company."; [
2145 (ii) "This service contract or warranty is subject to limited regulation by the Utah
2146 Insurance Department. To file a complaint, contact the Utah Insurance Department."; and
2147 (iii) A service contract or reimbursement insurance policy may not be issued, sold, or
2148 offered for sale in this state unless the contract contains a statement in substantially the
2149 following form, "Coverage afforded under this contract is not guaranteed by the Property and
2150 Casualty Guaranty Association."
2151 (b) A vehicle protection product warranty may not be issued, sold, or offered for sale in
2152 this state unless the vehicle protection product warranty contains the following statements in
2153 substantially the following form:
2154 (i) "Obligations of the warrantor under this vehicle protection product warranty are
2155 guaranteed under a reimbursement insurance policy. Should the warrantor fail to pay on any
2156 claim within 60 days after proof of loss has been filed, the warranty holder is entitled to make a
2157 claim directly against the Insurance Company."; [
2158 (ii) "This vehicle protection product warranty is subject to limited regulation by the
2159 Utah Insurance Department. To file a complaint, contact the Utah Insurance Department."; and
2160 (iii) as applicable:
2161 (A) "The warrantor under this vehicle protection product warranty will reimburse the
2162 warranty holder as specified in the warranty upon the theft of the vehicle."; or
2163 (B) "The warrantor under this vehicle protection product warranty will reimburse the
2164 warranty holder as specified in the warranty and at the end of the time period specified in the
2165 warranty if, following the theft of the vehicle, the stolen vehicle is not recovered within a time
2166 period specified in the warranty, not to exceed 30 days after the day on which the vehicle is
2167 reported stolen."
2168 (c) A vehicle protection product warranty, or reimbursement insurance policy, may not
2169 be issued, sold, or offered for sale in this state unless the warranty contains a statement in
2170 substantially the following form, "Coverage afforded under this warranty is not guaranteed by
2171 the Property and Casualty Guaranty Association."
2172 (3) A service contract and a vehicle protection product warranty shall:
2173 (a) conspicuously state the name, address, and a toll free claims service telephone
2174 number of the reimbursement insurer;
2175 (b) (i) identify the service contract provider, the seller, and the service contract holder;
2176 or
2177 (ii) identify the warrantor, the seller, and the warranty holder;
2178 (c) conspicuously state the total purchase price and the terms under which the service
2179 contract or warranty is to be paid;
2180 (d) conspicuously state the existence of any deductible amount;
2181 (e) specify the merchandise, service to be provided, and any limitation, exception, or
2182 exclusion;
2183 (f) state a term, restriction, or condition governing the transferability of the service
2184 contract or warranty; and
2185 (g) state a term, restriction, or condition that governs cancellation of the service
2186 contract as provided in Sections 31A-21-303 through 31A-21-305 by either the contract holder
2187 or service contract provider.
2188 (4) If prior approval of repair work is required, a service contract shall conspicuously
2189 state the procedure for obtaining prior approval and for making a claim, including:
2190 (a) a toll free telephone number for claim service; and
2191 (b) a procedure for obtaining reimbursement for emergency repairs performed outside
2192 of normal business hours.
2193 (5) A preexisting condition clause in a service contract shall specifically state which
2194 preexisting condition is excluded from coverage.
2195 (6) (a) Except as provided in Subsection (6)(c), a service contract shall state the
2196 conditions upon which the use of a nonmanufacturers' part is allowed.
2197 (b) A condition described in Subsection (6)(a) shall comply with applicable state and
2198 federal laws.
2199 (c) This Subsection (6) does not apply to a home warranty contract.
2200 (7) This section applies to a vehicle protection product warranty, except for the
2201 requirements of Subsections (3)(d) and (g), (4), (5), and (6). The department may make rules
2202 in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, to implement
2203 the application of this section to a vehicle protection product warranty.
2204 (8) (a) As used in this Subsection (8), "conspicuous statement" means a disclosure that:
2205 (i) appears in all-caps, bold, and 14-point font; and
2206 (ii) provides a space to be initialed by the consumer:
2207 (A) immediately below the printed disclosure; and
2208 (B) at or before the time the consumer purchases the vehicle protection product.
2209 [
2210 in substantially the following form: "Purchase of this product is optional and is not required in
2211 order to finance, lease, or purchase a motor vehicle."
2212 (9) If a vehicle protection product warranty states that the warrantor will reimburse the
2213 warranty holder for incidental costs, the vehicle protection product warranty shall state how
2214 incidental costs paid under the warranty are calculated.
2215 (10) If a vehicle protection product warranty states that the warrantor will reimburse
2216 the warranty holder in a fixed amount, the vehicle protection product warranty shall state the
2217 fixed amount.
2218 Section 14. Section 31A-6a-105 is amended to read:
2219 31A-6a-105. Prohibited acts.
2220 (1) Except as provided in Subsection 31A-6a-104(2), a service contract provider or
2221 warrantor may not use in [
2222 literature:
2223 (a) any of the following words:
2224 (i) "insurance";
2225 (ii) "casualty";
2226 (iii) "surety";
2227 (iv) "mutual"; or
2228 (v) another word descriptive of the insurance, casualty, or surety business; or
2229 (b) a name deceptively similar to the name or description of:
2230 (i) an insurance or surety corporation; or
2231 (ii) another service contract provider.
2232 (2) A service contract provider [
2233 warrantor, or a warrantor's representative may not:
2234 (a) make, permit, or cause to be made a false or misleading statement in connection
2235 with the sale, offer to sell, or advertisement of a service contract or vehicle protection product;
2236 or
2237 (b) deliberately omit a material statement that would be considered misleading if
2238 omitted, in connection with the sale, offer to sell, or advertisement of a service contract or
2239 vehicle protection product.
2240 (3) A bank, savings and loan association, insurance company, or other lending
2241 institution may not require the purchase of a service contract as a condition of a loan.
2242 (4) Except for a bank, savings and loan association, industrial bank, or credit union, a
2243 service contract provider may not sell, or be the obligated party for:
2244 (a) a guaranteed asset protection waiver, unless registered with the commissioner under
2245 Chapter 6b, Guaranteed Asset Protection Waiver Act;
2246 (b) a debt cancellation agreement, unless licensed by the commissioner; or
2247 (c) a debt suspension agreement, unless licensed by the commissioner.
2248 (5) A warrantor or [
2249 (a) require the purchase of a vehicle protection product as a condition of the financing,
2250 lease, or purchase of a motor vehicle[
2251 (b) sell a vehicle protection product to a consumer before providing the consumer, for
2252 review, a copy of the vehicle protection product warranty that is filed with the Department of
2253 Insurance.
2254 Section 15. Section 31A-6a-111 is repealed and reenacted to read:
2255 31A-6a-111. Vehicle protection product warranty requirements.
2256 (1) A warrantor shall make a reimbursement promised under a vehicle protection
2257 product warranty as specified in the warranty, regardless of, and not contingent upon, the
2258 payment of a benefit provided for under the warranty holder's primary vehicle insurance or any
2259 other contract.
2260 (2) (a) If a vehicle protection product is represented as preventing the theft of a vehicle,
2261 the vehicle protection product warranty shall, at a minimum, provide for reimbursement of
2262 damage a theft causes to the motor vehicle up to $5,000, if the vehicle is recovered within the
2263 time period specified in the warranty following the theft of the vehicle, not to exceed 30 days
2264 after the day on which the vehicle is reported stolen.
2265 (b) If a vehicle protection product is represented as aiding in the recovery of a stolen
2266 vehicle, the vehicle protection product warranty shall provide for reimbursement of the vehicle
2267 up to $5,000, if the vehicle is not recovered within the time period specified in the warranty
2268 following the theft of the vehicle, not to exceed 30 days after the day on which the vehicle is
2269 reported stolen.
2270 Section 16. Section 31A-8-104 is amended to read:
2271 31A-8-104. Determination of ability to provide services.
2272 (1) The commissioner may not issue a certificate of authority to an applicant for a
2273 certificate of authority under this chapter unless the applicant demonstrates to the
2274 commissioner [
2275 (a) [
2276 care services in a manner to assure both availability and accessibility of adequate personnel and
2277 facilities and continuity of service; and
2278 (b) arrangements for an ongoing quality of health care assurance program concerning
2279 health care processes and outcomes[
2280
2281
2282 [
2283
2284
2285
2286
2287 [
2288
2289
2290
2291
2292
2293
2294
2295 [
2296
2297
2298 [
2299
2300 (2) (a) In accordance with Sections 31A-2-203 and 31A-2-204, the commissioner may
2301 order an independent audit or examination by one or more technical experts to determine an
2302 applicant's ability to provide the proposed health care services as described in Subsection (1).
2303 (b) In accordance with Section 31A-2-205, an applicant shall reimburse the
2304 commissioner for the reasonable cost of an independent audit or examination.
2305 [
2306
2307
2308 (3) Licensing under this chapter does not exempt an organization from any licensing
2309 requirement applicable under Title 26, Chapter 21, Health Care Facility Licensing and
2310 Inspection Act.
2311 Section 17. Section 31A-8a-102 is amended to read:
2312 31A-8a-102. Definitions.
2313 [
2314 (1) "Fee" means any periodic charge for use of a discount program.
2315 (2) "Health care provider" means a health care provider as defined in Section
2316 78B-3-403, with the exception of "licensed athletic trainer," who:
2317 (a) is practicing within the scope of the provider's license; and
2318 (b) has agreed either directly or indirectly, by contract or any other arrangement with a
2319 health discount program operator, to provide a discount to enrollees of a health discount
2320 program.
2321 (3) (a) "Health discount program" means a business arrangement or contract in which a
2322 person pays fees, dues, charges, or other consideration in exchange for a program that provides
2323 access to health care providers who agree to provide a discount for health care services.
2324 (b) "Health discount program" does not include a program that does not charge a
2325 membership fee or require other consideration from the member to use the program's discounts
2326 for health services.
2327 (4) "Health discount program marketer" means a person, including a private label
2328 entity, that markets, promotes, sells, or distributes a health discount program but does not
2329 operate a health discount program.
2330 (5) "Health discount program operator" means a person that provides a health discount
2331 program by entering into a contract or agreement, directly or indirectly, with a person or
2332 persons in this state who agree to provide discounts for health care services to enrollees of the
2333 health discount program and determines the charge to members.
2334 (6) "Marketing" means making or causing to be made any communication that contains
2335 information that relates to a product or contract regulated under this chapter.
2336 [
2337 made by a health insurer or health maintenance organization that is licensed under this title, in
2338 connection with existing contracts with the health insurer or health maintenance organization.
2339 Section 18. Section 31A-15-103 is amended to read:
2340 31A-15-103. Surplus lines insurance -- Unauthorized insurers.
2341 (1) Notwithstanding Section 31A-15-102, [
2342
2343
2344 may make an insurance contract [
2345 located in this state, subject to the limitations and requirements of this section.
2346 (2) (a) For a contract made under this section, the insurer may, in this state:
2347 (i) inspect the risks to be insured;
2348 (ii) collect premiums;
2349 (iii) adjust losses; and
2350 (iv) do another act reasonably incidental to the contract.
2351 (b) An act described in Subsection (2)(a) may be done through:
2352 (i) an employee; or
2353 (ii) an independent contractor.
2354 (3) (a) Subsections (1) and (2) do not permit a person to solicit business in this state on
2355 behalf of an insurer that has no certificate of authority.
2356 (b) Insurance placed with a nonadmitted insurer shall be placed [
2357 lines producer licensed under Chapter 23a, Insurance Marketing - Licensing Producers,
2358 Consultants, and Reinsurance Intermediaries.
2359 (c) The commissioner may by rule prescribe how a surplus lines producer may:
2360 (i) pay or permit the payment, commission, or other remuneration on insurance placed
2361 by the surplus lines producer under authority of the surplus lines producer's license to one
2362 holding a license to act as an insurance producer; and
2363 (ii) advertise the availability of the surplus lines producer's services in procuring, on
2364 behalf of a person seeking insurance, a contract with a nonadmitted insurer.
2365 (4) For a contract made under this section, a nonadmitted insurer is subject to Sections
2366 31A-23a-402, 31A-23a-402.5, and 31A-23a-403 and the rules adopted under those sections.
2367 (5) A nonadmitted insurer may not issue workers' compensation insurance coverage to
2368 an employer located in this state, except for stop loss coverage issued to an employer securing
2369 workers' compensation under Subsection 34A-2-201(2).
2370 (6) (a) The commissioner may by rule prohibit making a contract under Subsection (1)
2371 for a specified class of insurance if authorized insurers provide an established market for the
2372 class in this state that is adequate and reasonably competitive.
2373 (b) The commissioner may by rule place a restriction or a limitation on and create
2374 special procedures for making a contract under Subsection (1) for a specified class of insurance
2375 if:
2376 (i) there have been abuses of placements in the class; or
2377 (ii) the policyholders in the class, because of limited financial resources, business
2378 experience, or knowledge, cannot protect their own interests adequately.
2379 (c) The commissioner may prohibit an individual insurer from making a contract under
2380 Subsection (1) and all insurance producers from dealing with the insurer if:
2381 (i) the insurer willfully violates:
2382 (A) this section;
2383 (B) Section 31A-4-102, 31A-23a-402, 31A-23a-402.5, or 31A-26-303; or
2384 (C) a rule adopted under a section listed in Subsection (6)(c)(i)(A) or (B);
2385 (ii) the insurer fails to pay the fees and taxes specified under Section 31A-3-301; or
2386 (iii) the commissioner has reason to believe that the insurer is:
2387 (A) in an unsound condition;
2388 (B) operated in a fraudulent, dishonest, or incompetent manner; or
2389 (C) in violation of the law of its domicile.
2390 (d) (i) The commissioner may issue one or more lists of [
2391 foreign insurers whose:
2392 (A) solidity the commissioner doubts; or
2393 (B) practices the commissioner considers objectionable.
2394 (ii) The commissioner shall issue one or more lists of [
2395 foreign insurers the commissioner considers to be reliable and solid.
2396 (iii) In addition to the lists described in Subsections (6)(d)(i) and (ii), the commissioner
2397 may issue other relevant evaluations of [
2398 (iv) An action may not lie against the commissioner or an employee of the department
2399 for a written or oral communication made in, or in connection with the issuance of, a list or
2400 evaluation described in this Subsection (6)(d).
2401 (e) A foreign [
2402 "reliable" list only if the [
2403 (i) delivers a request to the commissioner to be on the list;
2404 (ii) establishes satisfactory evidence of good reputation and financial integrity;
2405 (iii) (A) delivers to the commissioner a copy of the [
2406 insurer's current annual statement certified by the insurer[
2407 delivers to the commissioner a copy of the nonadmitted insurer's annual statement within 60
2408 days after the day on which the nonadmitted insurer files the annual statement with the
2409 insurance regulatory authority where the nonadmitted insurer is domiciled; or
2410 [
2411
2412
2413 (B) files the nonadmitted insurer's annual statements with the National Association of
2414 Insurance Commissioners and the nonadmitted insurer's annual statements are available
2415 electronically from the National Association of Insurance Commissioners;
2416 (iv) (A) [
2417 Part 6, Risk-Based Capital, or maintains capital and surplus of at least $15,000,000, whichever
2418 is greater; [
2419 [
2420
2421
2422 [
2423
2424 [
2425
2426 [
2427
2428 (B) in the case of any "Lloyd's" or other similar incorporated or unincorporated group
2429 of alien individual insurers, maintains a trust fund that:
2430 (I) shall be in an amount not less than $50,000,000 as security to its full amount for all
2431 policyholders and creditors in the United States of each member of the group;
2432 (II) may consist of cash, securities, or investments of substantially the same character
2433 and quality as those which are "qualified assets" under Section 31A-17-201; and
2434 (III) may include as part of this trust arrangement a letter of credit that qualifies as
2435 acceptable security under Section 31A-17-404.1; and
2436 (v) for an alien insurer not domiciled in the United States or a territory of the United
2437 States, is listed on the Quarterly Listing of Alien Insurers maintained by the National
2438 Association of Insurance Commissioners International Insurers Department.
2439 (7) (a) Subject to Subsection (7)(b), a surplus lines producer may not, either knowingly
2440 or without reasonable investigation of the financial condition and general reputation of the
2441 insurer, place insurance under this section with:
2442 (i) a financially unsound insurer;
2443 (ii) an insurer engaging in unfair practices; or
2444 (iii) an otherwise substandard insurer.
2445 (b) A surplus line producer may place insurance under this section with an insurer
2446 described in Subsection (7)(a) if the surplus line producer:
2447 (i) gives the applicant notice in writing of the known deficiencies of the insurer or the
2448 limitations on the surplus line producer's investigation; and
2449 (ii) explains the need to place the business with that insurer.
2450 (c) A copy of the notice described in Subsection (7)(b) shall be kept in the office of the
2451 surplus line producer for at least five years.
2452 (d) To be financially sound, an insurer shall satisfy standards that are comparable to
2453 those applied under the laws of this state to an authorized insurer.
2454 (e) An insurer on the "doubtful or objectionable" list under Subsection (6)(d) or an
2455 insurer not on the commissioner's "reliable" list under Subsection (6)(e) is presumed
2456 substandard.
2457 (8) (a) A policy issued under this section shall:
2458 (i) include a description of the subject of the insurance; and
2459 (ii) indicate:
2460 (A) the coverage, conditions, and term of the insurance;
2461 (B) the premium charged the policyholder;
2462 (C) the premium taxes to be collected from the policyholder; and
2463 (D) the name and address of the policyholder and insurer.
2464 (b) If the direct risk is assumed by more than one insurer, the policy shall state:
2465 (i) the names and addresses of all insurers; and
2466 (ii) the portion of the entire direct risk each assumes.
2467 (c) A policy issued under this section shall have attached or affixed to the policy the
2468 following statement: "The insurer issuing this policy does not hold a certificate of authority to
2469 do business in this state and thus is not fully subject to regulation by the Utah insurance
2470 commissioner. This policy receives no protection from any of the guaranty associations created
2471 under Title 31A, Chapter 28, Guaranty Associations."
2472 (9) Upon placing a new or renewal coverage under this section, a surplus lines
2473 producer shall promptly deliver to the policyholder or the policyholder's agent evidence of the
2474 insurance consisting either of:
2475 (a) the policy as issued by the insurer; or
2476 (b) if the policy is not available upon placing the coverage, a certificate, cover note, or
2477 other confirmation of insurance complying with Subsection (8).
2478 (10) If the commissioner finds it necessary to protect the interests of insureds and the
2479 public in this state, the commissioner may by rule subject a policy issued under this section to
2480 as much of the regulation provided by this title as is required for a comparable policy written
2481 by an authorized foreign insurer.
2482 (11) (a) A surplus lines transaction in this state shall be examined to determine whether
2483 it complies with:
2484 (i) the surplus lines tax levied under Chapter 3, Department Funding, Fees, and Taxes;
2485 (ii) the solicitation limitations of Subsection (3);
2486 (iii) the requirement of Subsection (3) that placement be through a surplus lines
2487 producer;
2488 (iv) placement limitations imposed under Subsections (6)(a), (b), and (c); and
2489 (v) the policy form requirements of Subsections (8) and (10).
2490 (b) The examination described in Subsection (11)(a) shall take place as soon as
2491 practicable after the transaction. The surplus lines producer shall submit to the examiner
2492 information necessary to conduct the examination within a period specified by rule.
2493 (c) (i) The examination described in Subsection (11)(a) may be conducted by the
2494 commissioner or by an advisory organization created under Section 31A-15-111 and authorized
2495 by the commissioner to conduct these examinations. The commissioner is not required to
2496 authorize an additional advisory organization to conduct an examination under this Subsection
2497 (11)(c).
2498 (ii) The commissioner's authorization of one or more advisory organizations to act as
2499 examiners under this Subsection (11)(c) shall be:
2500 (A) by rule; and
2501 (B) evidenced by a contract, on a form provided by the commissioner, between the
2502 authorized advisory organization and the department.
2503 (d) (i) (A) A person conducting the examination described in Subsection (11)(a) shall
2504 collect a stamping fee of an amount not to exceed 1% of the policy premium payable in
2505 connection with the transaction.
2506 (B) A stamping fee collected by the commissioner shall be deposited in the General
2507 Fund.
2508 (C) The commissioner shall establish a stamping fee by rule.
2509 (ii) A stamping fee collected by an advisory organization is the property of the advisory
2510 organization to be used in paying the expenses of the advisory organization.
2511 (iii) Liability for paying a stamping fee is as required under Subsection 31A-3-303(1)
2512 for taxes imposed under Section 31A-3-301.
2513 (iv) The commissioner shall adopt a rule dealing with the payment of stamping fees. If
2514 a stamping fee is not paid when due, the commissioner or advisory organization may impose a
2515 penalty of 25% of the stamping fee due, plus 1-1/2% per month from the time of default until
2516 full payment of the stamping fee.
2517 [
2518
2519 (e) The commissioner, representatives of the department, advisory organizations,
2520 representatives and members of advisory organizations, authorized insurers, and surplus lines
2521 insurers are not liable for damages on account of statements, comments, or recommendations
2522 made in good faith in connection with their duties under this Subsection (11)(e) or under
2523 Section 31A-15-111.
2524 (f) An examination conducted under this Subsection (11) and a document or materials
2525 related to the examination are confidential.
2526 (12) (a) For a surplus lines insurance transaction in the state entered into on or after
2527 May 13, 2014, if an audit is required by the surplus lines insurance policy, a surplus lines
2528 insurer:
2529 (i) shall exercise due diligence to initiate an audit of an insured, to determine whether
2530 additional premium is owed by the insured, by no later than six months after the expiration of
2531 the term for which premium is paid; and
2532 (ii) may not audit an insured more than three years after the surplus lines insurance
2533 policy expires.
2534 (b) A surplus lines insurer that does not comply with this Subsection (12) may not
2535 charge or collect additional premium in excess of the premium agreed to under the surplus
2536 lines insurance policy.
2537 Section 19. Section 31A-16-103 is amended to read:
2538 31A-16-103. Acquisition of control of, divestiture of control of, or merger with
2539 domestic insurer.
2540 (1) (a) A person may not take the actions described in Subsection (1)(b) or (c) unless,
2541 at the time any offer, request, or invitation is made or any such agreement is entered into, or
2542 prior to the acquisition of securities if no offer or agreement is involved:
2543 (i) the person files with the commissioner a statement containing the information
2544 required by this section;
2545 (ii) the person provides a copy of the statement described in Subsection (1)(a)(i) to the
2546 insurer; and
2547 (iii) the commissioner approves the offer, request, invitation, agreement, or acquisition.
2548 (b) Unless the person complies with Subsection (1)(a), a person other than the issuer
2549 may not make a tender offer for, a request or invitation for tenders of, or enter into any
2550 agreement to exchange securities, or seek to acquire or acquire in the open market or otherwise,
2551 any voting security of a domestic insurer if after the acquisition, the person would directly,
2552 indirectly, by conversion, or by exercise of any right to acquire be in control of the insurer.
2553 (c) Unless the person complies with Subsection (1)(a), a person may not enter into an
2554 agreement to merge with or otherwise to acquire control of:
2555 (i) a domestic insurer; or
2556 (ii) any person controlling a domestic insurer.
2557 (d) For purposes of this section, a controlling person of a domestic insurer seeking to
2558 divest its controlling interest in the domestic insurer, in any manner, shall file with the
2559 commissioner, with a copy to the insurer, confidential notice of its proposed divestiture at least
2560 30 days before the cessation of control. The commissioner shall determine those instances in
2561 which the one or more persons seeking to divest or to acquire a controlling interest in an
2562 insurer, will be required to file for and obtain approval of the transaction. The information
2563 shall remain confidential until the conclusion of the transaction unless the commissioner, in the
2564 commissioner's discretion, determines that confidential treatment will interfere with
2565 enforcement of this section. If the statement referred to in Subsection (1)(a) is otherwise filed,
2566 this Subsection (1)(d) does not apply.
2567 (e) With respect to a transaction subject to this section, the acquiring person shall also
2568 file a pre-acquisition notification with the commissioner, which shall contain the information
2569 set forth in Section 31A-16-104.5. A failure to file the notification may be subject to penalties
2570 specified in Section 31A-16-104.5.
2571 (f) (i) For purposes of this section, a domestic insurer includes any person controlling a
2572 domestic insurer unless the person as determined by the commissioner is either directly or
2573 through its affiliates primarily engaged in business other than the business of insurance.
2574 (ii) The controlling person described in Subsection (1)(f)(i) shall file with the
2575 commissioner a preacquisition notification containing the information required in Subsection
2576 (2) 30 calendar days before the proposed effective date of the acquisition.
2577 (iii) For the purposes of this section, "person" does not include any securities broker
2578 that in the usual and customary brokers function holds less than 20% of:
2579 (A) the voting securities of an insurance company; or
2580 (B) any person that controls an insurance company.
2581 (iv) This section applies to all domestic insurers and other entities licensed under:
2582 (A) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
2583 (B) Chapter 7, Nonprofit Health Service Insurance Corporations;
2584 (C) Chapter 8, Health Maintenance Organizations and Limited Health Plans;
2585 (D) Chapter 9, Insurance Fraternals; and
2586 (E) Chapter 11, Motor Clubs.
2587 (g) (i) An agreement for acquisition of control or merger as contemplated by this
2588 Subsection (1) is not valid or enforceable unless the agreement:
2589 (A) is in writing; and
2590 (B) includes a provision that the agreement is subject to the approval of the
2591 commissioner upon the filing of any applicable statement required under this chapter.
2592 (ii) A written agreement for acquisition or control that includes the provision described
2593 in Subsection (1)(g)(i) satisfies the requirements of this Subsection (1).
2594 (2) The statement to be filed with the commissioner under Subsection (1) shall be
2595 made under oath or affirmation and shall contain the following information:
2596 (a) the name and address of the "acquiring party," which means each person by whom
2597 or on whose behalf the merger or other acquisition of control referred to in Subsection (1) is to
2598 be effected; and
2599 (i) if the person is an individual:
2600 (A) the person's principal occupation;
2601 (B) a listing of all offices and positions held by the person during the past five years;
2602 and
2603 (C) any conviction of crimes other than minor traffic violations during the past 10
2604 years; and
2605 (ii) if the person is not an individual:
2606 (A) a report of the nature of its business operations during:
2607 (I) the past five years; or
2608 (II) for any lesser period as the person and any of its predecessors has been in
2609 existence;
2610 (B) an informative description of the business intended to be done by the person and
2611 the person's subsidiaries;
2612 (C) a list of all individuals who are or who have been selected to become directors or
2613 executive officers of the person, or individuals who perform, or who will perform functions
2614 appropriate to such positions; and
2615 (D) for each individual described in Subsection (2)(a)(ii)(C), the information required
2616 by Subsection (2)(a)(i) for each individual;
2617 (b) (i) the source, nature, and amount of the consideration used or to be used in
2618 effecting the merger or acquisition of control;
2619 (ii) a description of any transaction in which funds were or are to be obtained for the
2620 purpose of effecting the merger or acquisition of control, including any pledge of:
2621 (A) the insurer's stock; or
2622 (B) the stock of any of the insurer's subsidiaries or controlling affiliates; and
2623 (iii) the identity of persons furnishing the consideration;
2624 (c) (i) fully audited financial information, or other financial information considered
2625 acceptable by the commissioner, of the earnings and financial condition of each acquiring party
2626 for:
2627 (A) the preceding five fiscal years of each acquiring party; or
2628 (B) any lesser period the acquiring party and any of its predecessors shall have been in
2629 existence; and
2630 (ii) unaudited information:
2631 (A) similar to the information described in Subsection (2)(c)(i); and
2632 (B) prepared within the 90 days prior to the filing of the statement;
2633 (d) any plans or proposals which each acquiring party may have to:
2634 (i) liquidate the insurer;
2635 (ii) sell its assets;
2636 (iii) merge or consolidate the insurer with any person; or
2637 (iv) make any other material change in the insurer's:
2638 (A) business;
2639 (B) corporate structure; or
2640 (C) management;
2641 (e) (i) the number of shares of any security referred to in Subsection (1) that each
2642 acquiring party proposes to acquire;
2643 (ii) the terms of the offer, request, invitation, agreement, or acquisition referred to in
2644 Subsection (1); and
2645 (iii) a statement as to the method by which the fairness of the proposal was arrived at;
2646 (f) the amount of each class of any security referred to in Subsection (1) that:
2647 (i) is beneficially owned; or
2648 (ii) concerning which there is a right to acquire beneficial ownership by each acquiring
2649 party;
2650 (g) a full description of any contract, arrangement, or understanding with respect to any
2651 security referred to in Subsection (1) in which any acquiring party is involved, including:
2652 (i) the transfer of any of the securities;
2653 (ii) joint ventures;
2654 (iii) loan or option arrangements;
2655 (iv) puts or calls;
2656 (v) guarantees of loans;
2657 (vi) guarantees against loss or guarantees of profits;
2658 (vii) division of losses or profits; or
2659 (viii) the giving or withholding of proxies;
2660 (h) a description of the purchase by any acquiring party of any security referred to in
2661 Subsection (1) during the 12 calendar months preceding the filing of the statement including:
2662 (i) the dates of purchase;
2663 (ii) the names of the purchasers; and
2664 (iii) the consideration paid or agreed to be paid for the purchase;
2665 (i) a description of:
2666 (i) any recommendations to purchase by any acquiring party any security referred to in
2667 Subsection (1) made during the 12 calendar months preceding the filing of the statement; or
2668 (ii) any recommendations made by anyone based upon interviews or at the suggestion
2669 of the acquiring party;
2670 (j) (i) copies of all tender offers for, requests for, or invitations for tenders of, exchange
2671 offers for, and agreements to acquire or exchange any securities referred to in Subsection (1);
2672 and
2673 (ii) if distributed, copies of additional soliciting material relating to the transactions
2674 described in Subsection (2)(j)(i);
2675 (k) (i) the term of any agreement, contract, or understanding made with, or proposed to
2676 be made with, any broker-dealer as to solicitation of securities referred to in Subsection (1) for
2677 tender; and
2678 (ii) the amount of any fees, commissions, or other compensation to be paid to
2679 broker-dealers with regard to any agreement, contract, or understanding described in
2680 Subsection (2)(k)(i);
2681 (l) an agreement by the person required to file the statement referred to in Subsection
2682 (1) that it will provide the annual report, specified in Section 31A-16-105, for so long as
2683 control exists;
2684 (m) an acknowledgment by the person required to file the statement referred to in
2685 Subsection (1) that the person and all subsidiaries within its control in the insurance holding
2686 company system will provide information to the commissioner upon request as necessary to
2687 evaluate enterprise risk to the insurer; and
2688 (n) any additional information the commissioner requires by rule, which the
2689 commissioner determines to be:
2690 (i) necessary or appropriate for the protection of policyholders of the insurer; or
2691 (ii) in the public interest.
2692 (3) The department may request:
2693 (a) (i) criminal background information maintained pursuant to Title 53, Chapter 10,
2694 Part 2, Bureau of Criminal Identification, from the Bureau of Criminal Identification; and
2695 (ii) complete Federal Bureau of Investigation criminal background checks through the
2696 national criminal history system.
2697 (b) Information obtained by the department from the review of criminal history records
2698 received under Subsection (3)(a) shall be used by the department for the purpose of:
2699 (i) verifying the information in Subsection (2)(a)(i);
2700 (ii) determining the integrity of persons who would control the operation of an insurer;
2701 and
2702 (iii) preventing persons who violate 18 U.S.C. Sec. 1033 from engaging in the business
2703 of insurance in the state.
2704 (c) If the department requests the criminal background information, the department
2705 shall:
2706 (i) pay to the Department of Public Safety the costs incurred by the Department of
2707 Public Safety in providing the department criminal background information under Subsection
2708 (3)(a)(i);
2709 (ii) pay to the Federal Bureau of Investigation the costs incurred by the Federal Bureau
2710 of Investigation in providing the department criminal background information under
2711 Subsection (3)(a)(ii); and
2712 (iii) charge the person required to file the statement referred to in Subsection (1) a fee
2713 equal to the aggregate of Subsections (3)(c)(i) and (ii).
2714 (4) (a) If the source of the consideration under Subsection (2)(b)(i) is a loan made in
2715 the lender's ordinary course of business, the identity of the lender shall remain confidential, if
2716 the person filing the statement so requests.
2717 (b) (i) Under Subsection (2)(e), the commissioner may require a statement of the
2718 adjusted book value assigned by the acquiring party to each security in arriving at the terms of
2719 the offer.
2720 (ii) For purposes of this Subsection (4)(b), "adjusted book value" means each security's
2721 proportional interest in the capital and surplus of the insurer with adjustments that reflect:
2722 (A) market conditions;
2723 (B) business in force; and
2724 (C) other intangible assets or liabilities of the insurer.
2725 (c) The description required by Subsection (2)(g) shall identify the persons with whom
2726 the contracts, arrangements, or understandings have been entered into.
2727 (5) (a) If the person required to file the statement referred to in Subsection (1) is a
2728 partnership, limited partnership, syndicate, or other group, the commissioner may require that
2729 all the information called for by Subsection (2), (3), or (4) shall be given with respect to each:
2730 (i) partner of the partnership or limited partnership;
2731 (ii) member of the syndicate or group; and
2732 (iii) person who controls the partner or member.
2733 (b) If any partner, member, or person referred to in Subsection (5)(a) is a corporation,
2734 or if the person required to file the statement referred to in Subsection (1) is a corporation, the
2735 commissioner may require that the information called for by Subsection (2) shall be given with
2736 respect to:
2737 (i) the corporation;
2738 (ii) each officer and director of the corporation; and
2739 (iii) each person who is directly or indirectly the beneficial owner of more than 10% of
2740 the outstanding voting securities of the corporation.
2741 (6) If any material change occurs in the facts set forth in the statement filed with the
2742 commissioner and sent to the insurer pursuant to Subsection (2), an amendment setting forth
2743 the change, together with copies of all documents and other material relevant to the change,
2744 shall be filed with the commissioner and sent to the insurer within two business days after the
2745 filing person learns of such change.
2746 (7) If any offer, request, invitation, agreement, or acquisition referred to in Subsection
2747 (1) is proposed to be made by means of a registration statement under the Securities Act of
2748 1933, or under circumstances requiring the disclosure of similar information under the
2749 Securities Exchange Act of 1934, or under a state law requiring similar registration or
2750 disclosure, a person required to file the statement referred to in Subsection (1) may use copies
2751 of any registration or disclosure documents in furnishing the information called for by the
2752 statement.
2753 (8) (a) The commissioner shall approve any merger or other acquisition of control
2754 referred to in Subsection (1), unless[
2755 commissioner finds that:
2756 (i) after the change of control, the domestic insurer referred to in Subsection (1) would
2757 not be able to satisfy the requirements for the issuance of a license to write the line or lines of
2758 insurance for which it is presently licensed;
2759 (ii) the effect of the merger or other acquisition of control would:
2760 (A) substantially lessen competition in insurance in this state; or
2761 (B) tend to create a monopoly in insurance;
2762 (iii) the financial condition of any acquiring party might:
2763 (A) jeopardize the financial stability of the insurer; or
2764 (B) prejudice the interest of:
2765 (I) its policyholders; or
2766 (II) any remaining securityholders who are unaffiliated with the acquiring party;
2767 (iv) the terms of the offer, request, invitation, agreement, or acquisition referred to in
2768 Subsection (1) are unfair and unreasonable to the securityholders of the insurer;
2769 (v) the plans or proposals which the acquiring party has to liquidate the insurer, sell its
2770 assets, or consolidate or merge it with any person, or to make any other material change in its
2771 business or corporate structure or management, are:
2772 (A) unfair and unreasonable to policyholders of the insurer; and
2773 (B) not in the public interest; or
2774 (vi) the competence, experience, and integrity of those persons who would control the
2775 operation of the insurer are such that it would not be in the interest of the policyholders of the
2776 insurer and the public to permit the merger or other acquisition of control.
2777 (b) For purposes of Subsection (8)(a)(iv), the offering price for each security may not
2778 be considered unfair if the adjusted book values under Subsection (2)(e):
2779 (i) are disclosed to the securityholders; and
2780 (ii) determined by the commissioner to be reasonable.
2781 (9) For a merger or other acquisition of control described in Subsection (1), the
2782 commissioner:
2783 (a) may hold a public hearing on the merger or other acquisition at the commissioner's
2784 discretion; and
2785 (b) shall hold a public hearing on the merger or other acquisition upon request by the
2786 acquiring party, the insurer, or any other interested party.
2787 [
2788
2789 the statement required by Subsection (1) is filed.
2790 (b) (i) [
2791
2792 (ii) Affected parties may waive the notice required by this Subsection (9)(b).
2793 (iii) Not less than seven days notice of the public hearing shall be given by the person
2794 filing the statement to:
2795 (A) the insurer; and
2796 (B) any person designated by the commissioner.
2797 (c) The commissioner shall make a determination within 30 days after the conclusion
2798 of the hearing.
2799 (d) At the hearing, the person filing the statement, the insurer, any person to whom
2800 notice of hearing was sent, and any other person whose interest may be affected by the hearing
2801 may:
2802 (i) present evidence;
2803 (ii) examine and cross-examine witnesses; and
2804 (iii) offer oral and written arguments.
2805 (e) (i) A person or insurer described in Subsection [
2806 proceedings in the same manner as is presently allowed in the district courts of this state.
2807 (ii) All discovery proceedings shall be concluded not later than three days before the
2808 commencement of the public hearing.
2809 [
2810 one commissioner, the public hearing [
2811 on a consolidated basis upon request of the person filing the statement referred to in Subsection
2812 (1). The person shall file the statement referred to in Subsection (1) with the National
2813 Association of Insurance Commissioners within five days of making the request for a public
2814 hearing. A commissioner may opt out of a consolidated hearing and shall provide notice to the
2815 applicant of the opt-out within 10 days of the receipt of the statement referred to in Subsection
2816 (1). A hearing conducted on a consolidated basis shall be public and shall be held within the
2817 United States before the commissioners of the states in which the insurers are domiciled. The
2818 commissioners shall hear and receive evidence. A commissioner may attend a hearing under
2819 this Subsection [
2820 [
2821 determination by the commissioner that the person acquiring control of the insurer shall be
2822 required to maintain or restore the capital of the insurer to the level required by the laws and
2823 regulations of this state shall be made not later than 60 days after the date of notification of the
2824 change in control submitted pursuant to Subsection (1).
2825 [
2826 or a portion of, information filed in connection with a proposed merger or other acquisition of
2827 control referred to in Subsection (1).
2828 (b) In determining whether any of the conditions in Subsection (8) exist, the
2829 commissioner may consider the findings of technical experts employed to review applicable
2830 filings.
2831 (c) (i) A technical expert employed under Subsection [
2832 commissioner a statement of all expenses incurred by the technical expert in conjunction with
2833 the technical expert's review of a proposed merger or other acquisition of control.
2834 (ii) At the commissioner's direction the acquiring person shall compensate the technical
2835 expert at customary rates for time and expenses:
2836 (A) necessarily incurred; and
2837 (B) approved by the commissioner.
2838 (iii) The acquiring person shall:
2839 (A) certify the consolidated account of all charges and expenses incurred for the review
2840 by technical experts;
2841 (B) retain a copy of the consolidated account described in Subsection [
2842 (13)(c)(iii)(A); and
2843 (C) file with the department as a public record a copy of the consolidated account
2844 described in Subsection [
2845 [
2846 securityholder electing to exercise a right of dissent may file with the insurer a written request
2847 for payment of the adjusted book value given in the statement required by Subsection (1) and
2848 approved under Subsection (8), in return for the surrender of the security holder's securities.
2849 (ii) The request described in Subsection [
2850 days after the day of the securityholders' meeting where the corporate action is approved.
2851 (b) The dissenting securityholder is entitled to and the insurer is required to pay to the
2852 dissenting securityholder the specified value within 60 days of receipt of the dissenting security
2853 holder's security.
2854 (c) Persons electing under this Subsection [
2855 waive the dissenting shareholder and appraisal rights otherwise applicable under Title 16,
2856 Chapter 10a, Part 13, Dissenters' Rights.
2857 (d) (i) This Subsection [
2858 securityholders to resolve their objections to the plan of merger.
2859 (ii) This section does not restrict the rights of dissenting securityholders under Title 16,
2860 Chapter 10a, Utah Revised Business Corporation Act, unless this election is made under this
2861 Subsection [
2862 [
2863 (1), and all notices of public hearings held under Subsection (8), shall be mailed by the insurer
2864 to its securityholders within five business days after the insurer has received the statements,
2865 amendments, other material, or notices.
2866 (b) (i) Mailing expenses shall be paid by the person making the filing.
2867 (ii) As security for the payment of mailing expenses, that person shall file with the
2868 commissioner an acceptable bond or other deposit in an amount determined by the
2869 commissioner.
2870 [
2871 acquisition that the commissioner by order exempts from the requirements of this section as:
2872 (a) not having been made or entered into for the purpose of, and not having the effect
2873 of, changing or influencing the control of a domestic insurer; or
2874 (b) otherwise not comprehended within the purposes of this section.
2875 [
2876 (a) the failure to file any statement, amendment, or other material required to be filed
2877 pursuant to Subsections (1), (2), and (5); or
2878 (b) the effectuation, or any attempt to effectuate, an acquisition of control of,
2879 divestiture of, or merger with a domestic insurer unless the commissioner has given the
2880 commissioner's approval to the acquisition or merger.
2881 [
2882 (i) a person who:
2883 (A) files a statement with the commissioner under this section; and
2884 (B) is not resident, domiciled, or authorized to do business in this state; and
2885 (ii) overall actions involving persons described in Subsection [
2886 out of a violation of this section.
2887 (b) A person described in Subsection [
2888 acts equivalent to and constituting an appointment of the commissioner by that person, to be
2889 that person's lawful agent upon whom may be served all lawful process in any action, suit, or
2890 proceeding arising out of a violation of this section.
2891 (c) A copy of a lawful process described in Subsection [
2892 (i) served on the commissioner; and
2893 (ii) transmitted by registered or certified mail by the commissioner to the person at that
2894 person's last-known address.
2895 Section 20. Section 31A-22-612 is amended to read:
2896 31A-22-612. Conversion privileges for insured former spouse.
2897 (1) An accident and health insurance policy, which in addition to covering the insured
2898 also provides coverage to the spouse of the insured, may not contain a provision for
2899 termination of coverage of a spouse covered under the policy, except by entry of a valid decree
2900 of divorce, legal separation, or annulment between the parties.
2901 (2) Every policy which contains this type of provision shall provide that upon the entry
2902 of the divorce decree the spouse is entitled to have issued an individual policy of accident and
2903 health insurance without evidence of insurability, upon application to the company and
2904 payment of the appropriate premium. The policy shall provide the coverage being issued
2905 which is most nearly similar to the terminated coverage. Probationary or waiting periods in the
2906 policy are considered satisfied to the extent the coverage was in force under the prior policy.
2907 (3) When the insurer receives actual notice that the coverage of a spouse is to be
2908 terminated because of a divorce, legal separation, or annulment, the insurer shall promptly
2909 provide the spouse written notification of the right to obtain individual coverage as provided in
2910 Subsection (2), the premium amounts required, and the manner, place, and time in which
2911 premiums may be paid. The premium is determined in accordance with the insurer's table of
2912 premium rates applicable to the age and class of risk of the persons to be covered and to the
2913 type and amount of coverage provided. If the spouse applies and tenders the first monthly
2914 premium to the insurer within 30 days after receiving the notice provided by this Subsection
2915 (3), the spouse shall receive individual coverage that commences immediately upon
2916 termination of coverage under the insured's policy.
2917 (4) This section does not apply to accident and health insurance policies offered on a
2918 group blanket basis or a health benefit plan.
2919 Section 21. Section 31A-22-618.6 is amended to read:
2920 31A-22-618.6. Discontinuance, nonrenewal, or changes to group health benefit
2921 plans.
2922 (1) Except as otherwise provided in this section, a group health benefit plan for a plan
2923 sponsor is renewable and continues in force:
2924 (a) with respect to all eligible employees and dependents; and
2925 (b) at the option of the plan sponsor.
2926 (2) A health benefit plan for a plan sponsor may be discontinued or nonrenewed:
2927 (a) for noncompliance with the insurer's employer contribution requirements;
2928 (b) if there is no longer any enrollee under the group health plan who lives, resides, or
2929 works in:
2930 (i) the service area of the insurer; or
2931 (ii) the area for which the insurer is authorized to do business;
2932 (c) for coverage made available in the small or large employer market only through an
2933 association, if:
2934 (i) the employer's membership in the association ceases; and
2935 (ii) the coverage is terminated uniformly without regard to any health status-related
2936 factor relating to any covered individual; or
2937 (d) for noncompliance with the insurer's minimum employee participation
2938 requirements, except as provided in Subsection (3).
2939 (3) If a small employer [
2940 employs at least one eligible employee, a carrier may not discontinue or not renew the health
2941 benefit plan until the first renewal date following the beginning of a new plan year, even if the
2942 carrier knows at the beginning of the plan year that the employer no longer has at least [
2943
2944 (4) (a) A small employer that, after purchasing a health benefit plan in the small group
2945 market, employs on average more than 50 eligible employees on each business day in a
2946 calendar year may continue to renew the health benefit plan purchased in the small group
2947 market.
2948 (b) A large employer that, after purchasing a health benefit plan in the large group
2949 market, employs on average fewer than 51 eligible employees on each business day in a
2950 calendar year may continue to renew the health benefit plan purchased in the large group
2951 market.
2952 (5) A health benefit plan for a plan sponsor may be discontinued if:
2953 (a) a condition described in Subsection (2) exists;
2954 (b) the plan sponsor fails to pay premiums or contributions in accordance with the
2955 terms of the contract;
2956 (c) the plan sponsor:
2957 (i) performs an act or practice that constitutes fraud; or
2958 (ii) makes an intentional misrepresentation of material fact under the terms of the
2959 coverage;
2960 (d) the insurer:
2961 (i) elects to discontinue offering a particular health benefit plan product delivered or
2962 issued for delivery in this state; and
2963 (ii) (A) provides notice of the discontinuation in writing to each plan sponsor,
2964 employee, or dependent of a plan sponsor or an employee, at least 90 days before the date the
2965 coverage will be discontinued;
2966 (B) provides notice of the discontinuation in writing to the commissioner, and at least
2967 three working days before the date the notice is sent to the affected plan sponsors, employees,
2968 and dependents of the plan sponsors or employees;
2969 (C) offers to each plan sponsor, on a guaranteed issue basis, the option to purchase all
2970 other health benefit plans currently being offered by the insurer in the market or, in the case of
2971 a large employer, any other health benefit plans currently being offered in that market; and
2972 (D) in exercising the option to discontinue that health benefit plan and in offering the
2973 option of coverage in this section, acts uniformly without regard to the claims experience of a
2974 plan sponsor, any health status-related factor relating to any covered participant or beneficiary,
2975 or any health status-related factor relating to any new participant or beneficiary who may
2976 become eligible for the coverage; or
2977 (e) the insurer:
2978 (i) elects to discontinue all of the insurer's health benefit plans in:
2979 (A) the small employer market;
2980 (B) the large employer market; or
2981 (C) both the small employer and large employer markets; and
2982 (ii) (A) provides notice of the discontinuation in writing to each plan sponsor,
2983 employee, or dependent of a plan sponsor or an employee at least 180 days before the date the
2984 coverage will be discontinued;
2985 (B) provides notice of the discontinuation in writing to the commissioner in each state
2986 in which an affected insured individual is known to reside and, at least 30 working days before
2987 the date the notice is sent to the affected plan sponsors, employees, and the dependents of the
2988 plan sponsors or employees;
2989 (C) discontinues and nonrenews all plans issued or delivered for issuance in the market
2990 described in Subsection (5)(e)(i) ; and
2991 (D) provides a plan of orderly withdrawal as required by Section 31A-4-115.
2992 (6) (a) Except as provided in Subsection (6)(d), an eligible employee may be
2993 discontinued if after issuance of coverage the eligible employee:
2994 (i) engages in an act or practice in connection with the coverage that constitutes fraud;
2995 or
2996 (ii) makes an intentional misrepresentation of material fact in connection with the
2997 coverage.
2998 (b) An eligible employee that is discontinued under Subsection (6)(a) may reenroll:
2999 (i) 12 months after the date of discontinuance; and
3000 (ii) if the plan sponsor's coverage is in effect at the time the eligible employee applies
3001 to reenroll.
3002 (c) At the time the eligible employee's coverage is discontinued under Subsection
3003 (6)(a), the insurer shall notify the eligible employee of the right to reenroll when coverage is
3004 discontinued.
3005 (d) An eligible employee may not be discontinued under this Subsection (6) because of
3006 a fraud or misrepresentation that relates to health status.
3007 (7) For purposes of this section, a reference to "plan sponsor" includes a reference to
3008 the employer:
3009 (a) with respect to coverage provided to an employer member of the association; and
3010 (b) if the health benefit plan is made available by an insurer in the employer market
3011 only through:
3012 (i) an association;
3013 (ii) a trust; or
3014 (iii) a discretionary group.
3015 (8) An insurer may modify a health benefit plan for a plan sponsor only:
3016 (a) at the time of coverage renewal; and
3017 (b) if the modification is effective uniformly among all plans with that product.
3018 Section 22. Section 31A-22-629 is amended to read:
3019 31A-22-629. Adverse benefit determination review process.
3020 (1) As used in this section:
3021 (a) (i) "Adverse benefit determination" means the:
3022 (A) denial of a benefit;
3023 (B) reduction of a benefit;
3024 (C) termination of a benefit; or
3025 (D) failure to provide or make payment, in whole or in part, for a benefit.
3026 (ii) "Adverse benefit determination" includes:
3027 (A) denial, reduction, termination, or failure to provide or make payment that is based
3028 on a determination of an insured's or a beneficiary's eligibility to participate in a plan;
3029 (B) denial, reduction, or termination of, or a failure to provide or make payment, in
3030 whole or in part, for, a benefit resulting from the application of a utilization review; or
3031 (C) failure to cover an item or service for which benefits are otherwise provided
3032 because it is determined to be:
3033 (I) experimental;
3034 (II) investigational; or
3035 (III) not medically necessary or appropriate.
3036 (b) "Independent review" means a process that:
3037 (i) is a voluntary option for the resolution of an adverse benefit determination;
3038 (ii) is conducted at the discretion of the claimant;
3039 (iii) is conducted by an independent review organization designated by the [
3040 commissioner;
3041 (iv) renders an independent and impartial decision on an adverse benefit determination
3042 submitted by an insured; and
3043 (v) may not require the insured to pay a fee for requesting the independent review.
3044 (c) "Independent review organization" means a person, subject to Subsection (6), who
3045 conducts an independent external review of adverse determinations.
3046 (d) "Insured" is as defined in Section 31A-1-301 and includes a person who is
3047 authorized to act on the insured's behalf.
3048 (e) "Insurer" is as defined in Section 31A-1-301 and includes:
3049 (i) a health maintenance organization; and
3050 (ii) a third party administrator that offers, sells, manages, or administers a health
3051 insurance policy or health maintenance organization contract that is subject to this title.
3052 (f) "Internal review" means the process an insurer uses to review an insured's adverse
3053 benefit determination before the adverse benefit determination is submitted for independent
3054 review.
3055 (2) This section applies generally to health insurance policies, health maintenance
3056 organization contracts, and income replacement or disability income policies.
3057 (3) (a) An insured may submit an adverse benefit determination to the insurer.
3058 (b) The insurer shall conduct an internal review of the insured's adverse benefit
3059 determination.
3060 (c) An insured who disagrees with the results of an internal review may submit the
3061 adverse benefit determination for an independent review if the adverse benefit determination
3062 involves:
3063 (i) payment of a claim regarding medical necessity; or
3064 (ii) denial of a claim regarding medical necessity.
3065 (4) The commissioner shall adopt rules that establish minimum standards for:
3066 (a) internal reviews;
3067 (b) independent reviews to ensure independence and impartiality;
3068 (c) the types of adverse benefit determinations that may be submitted to an independent
3069 review; and
3070 (d) the timing of the review process, including an expedited review when medically
3071 necessary.
3072 (5) Nothing in this section may be construed as:
3073 (a) expanding, extending, or modifying the terms of a policy or contract with respect to
3074 benefits or coverage;
3075 (b) permitting an insurer to charge an insured for the internal review of an adverse
3076 benefit determination;
3077 (c) restricting the use of arbitration in connection with or subsequent to an independent
3078 review; or
3079 (d) altering the legal rights of any party to seek court or other redress in connection
3080 with:
3081 (i) an adverse decision resulting from an independent review, except that if the insurer
3082 is the party seeking legal redress, the insurer shall pay for the reasonable attorney fees of the
3083 insured related to the action and court costs; or
3084 (ii) an adverse benefit determination or other claim that is not eligible for submission
3085 to independent review.
3086 (6) (a) An independent review organization in relation to the insurer may not be:
3087 (i) the insurer;
3088 (ii) the health plan;
3089 (iii) the health plan's fiduciary;
3090 (iv) the employer; or
3091 (v) an employee or agent of any one listed in Subsections (6)(a)(i) through (iv).
3092 (b) An independent review organization may not have a material professional, familial,
3093 or financial conflict of interest with:
3094 (i) the health plan;
3095 (ii) an officer, director, or management employee of the health plan;
3096 (iii) the enrollee;
3097 (iv) the enrollee's health care provider;
3098 (v) the health care provider's medical group or independent practice association;
3099 (vi) a health care facility where service would be provided; or
3100 (vii) the developer or manufacturer of the service that would be provided.
3101 Section 23. Section 31A-22-701 is amended to read:
3102 31A-22-701. Groups eligible for group or blanket insurance.
3103 (1) As used in this section, "association group" means a lawfully formed association of
3104 individuals or business entities that:
3105 (a) purchases insurance on a group basis on behalf of members; and
3106 (b) is formed and maintained in good faith for purposes other than obtaining insurance.
3107 (2) A group accident and health insurance policy may be issued to:
3108 (a) a group:
3109 (i) to which a group life insurance policy may be issued under [
3110 31A-22-502, 31A-22-503, 31A-22-504, 31A-22-506, or 31A-22-507[
3111 (ii) that is formed and maintained in good faith for a purpose other than obtaining
3112 insurance;
3113 (b) an association group authorized by the commissioner that:
3114 (i) has been actively in existence for at least five years;
3115 (ii) has a constitution and bylaws;
3116 (iii) has a shared or common purpose that is not primarily a business or customer
3117 relationship;
3118 (iv) is formed and maintained in good faith for purposes other than obtaining
3119 insurance;
3120 (v) does not condition membership in the association group on any health status-related
3121 factor relating to an individual, including an employee of an employer or a dependent of an
3122 employee;
3123 (vi) makes accident and health insurance coverage offered through the association
3124 group available to all members regardless of any health status-related factor relating to the
3125 members or individuals eligible for coverage through a member;
3126 (vii) does not make accident and health insurance coverage offered through the
3127 association group available other than in connection with a member of the association group;
3128 and
3129 (viii) is actuarially sound; or
3130 (c) a group specifically authorized by the commissioner [
3131 upon a finding that:
3132 (i) authorization is not contrary to the public interest;
3133 (ii) the group is actuarially sound;
3134 (iii) formation of the proposed group may result in economies of scale in acquisition,
3135 administrative, marketing, and brokerage costs;
3136 (iv) the insurance policy, insurance certificate, or other indicia of coverage that will be
3137 offered to the proposed group is substantially equivalent to insurance policies that are
3138 otherwise available to similar groups;
3139 (v) the group would not present hazards of adverse selection;
3140 (vi) the premiums for the insurance policy and any contributions by or on behalf of the
3141 insured persons are reasonable in relation to the benefits provided; and
3142 (vii) the group is formed and maintained in good faith for a purpose other than
3143 obtaining insurance.
3144 (3) A blanket accident and health insurance policy:
3145 (a) covers a defined class of persons;
3146 (b) may not be offered or underwritten on an individual basis;
3147 (c) shall cover only a group that is:
3148 (i) actuarially sound; and
3149 (ii) formed and maintained in good faith for a purpose other than obtaining insurance;
3150 and
3151 (d) may be issued only to:
3152 (i) a common carrier or an operator, owner, or lessee of a means of transportation, as
3153 policyholder, covering persons who may become passengers as defined by reference to the
3154 person's travel status;
3155 (ii) an employer, as policyholder, covering any group of employees, dependents, or
3156 guests, as defined by reference to specified hazards incident to any activities of the
3157 policyholder;
3158 (iii) an institution of learning, including a school district, a school jurisdictional unit, or
3159 the head, principal, or governing board of a school jurisdictional unit, as policyholder, covering
3160 students, teachers, or employees;
3161 (iv) a religious, charitable, recreational, educational, or civic organization, or branch of
3162 one of those organizations, as policyholder, covering a group of members or participants as
3163 defined by reference to specified hazards incident to the activities sponsored or supervised by
3164 the policyholder;
3165 (v) a sports team, camp, or sponsor of a sports team or camp, as policyholder, covering
3166 members, campers, employees, officials, or supervisors;
3167 (vi) a volunteer fire department, first aid, civil defense, or other similar volunteer
3168 organization, as policyholder, covering a group of members or participants as defined by
3169 reference to specified hazards incident to activities sponsored, supervised, or participated in by
3170 the policyholder;
3171 (vii) a newspaper or other publisher, as policyholder, covering its carriers;
3172 (viii) an association, including a labor union, that has a constitution and bylaws and
3173 that is organized in good faith for purposes other than that of obtaining insurance, as
3174 policyholder, covering a group of members or participants as defined by reference to specified
3175 hazards incident to the activities or operations sponsored or supervised by the policyholder; and
3176 (ix) any other class of risks that, in the judgment of the commissioner, may be properly
3177 eligible for blanket accident and health insurance.
3178 (4) The judgment of the commissioner may be exercised on the basis of:
3179 (a) individual risks;
3180 (b) a class of risks; or
3181 (c) both Subsections (4)(a) and (b).
3182 Section 24. Section 31A-22-722 is amended to read:
3183 31A-22-722. Utah mini-COBRA benefits for employer group coverage.
3184 (1) An insured may extend the employee's coverage under the current employer's group
3185 policy for a period of 12 months, except as provided in [
3186 Subsection (2). The right to extend coverage includes:
3187 (a) voluntary termination;
3188 (b) involuntary termination;
3189 (c) retirement;
3190 (d) death;
3191 (e) divorce or legal separation;
3192 (f) loss of dependent status;
3193 (g) sabbatical;
3194 (h) a disability;
3195 (i) leave of absence; or
3196 (j) reduction of hours.
3197 (2) (a) Notwithstanding Subsection (1), an employee may not extend coverage under
3198 the current employer's group insurance policy if the employee:
3199 (i) fails to pay premiums or contributions in accordance with the terms of the insurance
3200 policy;
3201 (ii) acquires other group coverage covering all preexisting conditions including
3202 maternity, if the coverage exists;
3203 (iii) performs an act or practice that constitutes fraud in connection with the coverage;
3204 (iv) makes an intentional misrepresentation of material fact under the terms of the
3205 coverage;
3206 (v) is terminated from employment for gross misconduct;
3207 (vi) is not continuously covered under the current employer's group policy for a period
3208 of three months immediately before the termination of the insurance policy due to an event set
3209 forth in Subsection (1);
3210 (vii) is eligible for an extension of coverage required by federal law;
3211 (viii) establishes residence outside of this state;
3212 (ix) moves out of the insurer's service area;
3213 (x) is eligible for similar coverage under another group insurance policy; or
3214 (xi) has the employee's coverage terminated because the employer's coverage is
3215 terminated, except as provided in Subsection (8).
3216 (b) The right to extend coverage under Subsection (1) applies to spouse or dependent
3217 coverage, including a surviving spouse or dependents whose coverage under the insurance
3218 policy terminates by reason of the death of the employee or member.
3219 (3) (a) The employer shall notify the following in writing of the right to extend group
3220 coverage and the payment amounts required for extension of coverage, including the manner,
3221 place, and time in which the payments shall be made:
3222 (i) a terminated insured;
3223 (ii) an ex-spouse of an insured; or
3224 (iii) if Subsection (2)(b) applies:
3225 (A) a surviving spouse; and
3226 (B) the guardian of surviving dependents, if different from a surviving spouse.
3227 (b) The notification required in Subsection (3)(a) shall be sent first class mail within 30
3228 days after the termination date of the group coverage to:
3229 (i) the terminated insured's home address as shown on the records of the employer;
3230 (ii) the address of the surviving spouse, if different from the insured's address and if
3231 shown on the records of the employer;
3232 (iii) the guardian of any dependents address, if different from the insured's address, and
3233 if shown on the records of the employer; and
3234 (iv) the address of the ex-spouse, if shown on the records of the employer.
3235 (4) The insurer shall provide the employee, spouse, or any eligible dependent the
3236 opportunity to extend the group coverage at the payment amount stated in Subsection (5) if:
3237 (a) the employer policyholder does not provide the terminated insured the written
3238 notification required by Subsection (3)(a); and
3239 (b) the employee or other individual eligible for extension contacts the insurer within
3240 60 days of coverage termination.
3241 (5) (a) A premium amount for extended group coverage may not exceed 102% of the
3242 group rate in effect for a group member, including an employer's contribution, if any, for a
3243 group insurance policy.
3244 (b) Except as provided in Subsection (5)(a), an insurer may not charge an insured an
3245 additional fee, an additional premium, interest, or any similar charge for electing extended
3246 group coverage.
3247 (6) Except as provided in this Subsection (6), coverage extends without interruption for
3248 12 months and may not terminate if the terminated insured or, with respect to a minor, the
3249 parent or guardian of the terminated insured:
3250 (a) elects to extend group coverage within 60 days of losing group coverage; and
3251 (b) tenders the amount required to the employer or insurer.
3252 (7) The insured's coverage may be terminated before 12 months if the terminated
3253 insured:
3254 (a) establishes residence outside of this state;
3255 (b) moves out of the insurer's service area;
3256 (c) fails to pay premiums or contributions in accordance with the terms of the insurance
3257 policy, including any timeliness requirements;
3258 (d) performs an act or practice that constitutes fraud in connection with the coverage;
3259 (e) makes an intentional misrepresentation of material fact under the terms of the
3260 coverage;
3261 (f) becomes eligible for similar coverage under another group insurance policy; or
3262 (g) has the coverage terminated because the employer's coverage is terminated, except
3263 as provided in Subsection (8).
3264 (8) If the current employer coverage is terminated and the employer replaces coverage
3265 with similar coverage under another group insurance policy, without interruption, the
3266 terminated insured, spouse, or the surviving spouse and guardian of dependents if Subsection
3267 (2)(b) applies, may obtain extension of coverage under the replacement group insurance policy:
3268 (a) for the balance of the period the terminated insured would have extended coverage
3269 under the replaced group insurance policy; and
3270 (b) if the terminated insured is otherwise eligible for extension of coverage.
3271 (9) An insurer shall require an insured employer to offer to the following individuals an
3272 open enrollment period at the same time as other regular employees:
3273 (a) an individual who extends group coverage and is current on payment; and
3274 (b) during the applicable grace period described in Subsection (3) or (4), an individual
3275 who is eligible to elect to extend group coverage.
3276 Section 25. Section 31A-23a-107 is amended to read:
3277 31A-23a-107. Character requirements.
3278 An applicant for a license under this chapter shall show to the commissioner that:
3279 (1) the applicant has the intent in good faith, to engage in the type of business that the
3280 license applied for would permit;
3281 (2) (a) if a natural person, the applicant is:
3282 (i) competent; and
3283 (ii) trustworthy; or
3284 (b) if the applicant is an agency:
3285 (i) the partners, directors, or principal officers or persons having comparable powers
3286 are trustworthy; and
3287 (ii) that it will transact business in such a way that the acts that may only be performed
3288 by a licensed producer, surplus lines producer, limited line producer, consultant, managing
3289 general agent, or reinsurance intermediary are performed exclusively by natural persons who
3290 are licensed under this chapter to transact that type of business and designated on the agency's
3291 license;
3292 (3) the applicant intends to comply with Section 31A-23a-502; and
3293 (4) if a natural person, the applicant is at least 18 years of age.
3294 Section 26. Section 31A-23a-109 is amended to read:
3295 31A-23a-109. Nonresident jurisdictional agreement.
3296 (1) (a) If a nonresident license applicant has a valid producer, surplus lines producer,
3297 limited line producer, consultant, managing general agent, or reinsurance intermediary license
3298 from the nonresident license applicant's home state or designated home state and the conditions
3299 of Subsection (1)(b) are met, the commissioner shall:
3300 (i) waive the license requirements for a license under this chapter; and
3301 (ii) issue the nonresident license applicant a nonresident license.
3302 (b) Subsection (1)(a) applies if:
3303 (i) the nonresident license applicant:
3304 (A) is licensed [
3305 designated home state at the time the nonresident license applicant applies for a nonresident
3306 producer, surplus lines producer, limited line producer, consultant, managing general agent, or
3307 reinsurance intermediary license;
3308 (B) has submitted the proper request for licensure;
3309 (C) has submitted to the commissioner:
3310 (I) the application for licensure that the nonresident license applicant submitted to the
3311 applicant's home state or designated home state; or
3312 (II) a completed uniform application; and
3313 (D) has paid the applicable fees under Section 31A-3-103; and
3314 (ii) the nonresident license applicant's license in the applicant's home state or
3315 designated home state is in good standing.
3316 (2) A nonresident applicant applying under Subsection (1) shall in addition to
3317 complying with all license requirements for a license under this chapter execute, in a form
3318 acceptable to the commissioner, an agreement to be subject to the jurisdiction of the Utah
3319 commissioner and courts on any matter related to the applicant's insurance activities in this
3320 state, on the basis of:
3321 (a) service of process under Sections 31A-2-309 and 31A-2-310; or
3322 (b) service authorized:
3323 (i) in the Utah Rules of Civil Procedure; or
3324 (ii) under Section 78B-3-206.
3325 (3) The commissioner may verify a producer's licensing status through the producer
3326 database maintained by:
3327 (a) the National Association of Insurance Commissioners; or
3328 (b) an affiliate or subsidiary of the National Association of Insurance Commissioners.
3329 (4) The commissioner may not assess a greater fee for an insurance license or related
3330 service to a person not residing in this state solely on the fact that the person does not reside in
3331 this state.
3332 Section 27. Section 31A-23a-111 is amended to read:
3333 31A-23a-111. Revoking, suspending, surrendering, lapsing, limiting, or otherwise
3334 terminating a license -- Forfeiture -- Rulemaking for renewal or reinstatement.
3335 (1) A license type issued under this chapter remains in force until:
3336 (a) revoked or suspended under Subsection (5);
3337 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
3338 administrative action;
3339 (c) the licensee dies or is adjudicated incompetent as defined under:
3340 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
3341 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
3342 Minors;
3343 (d) lapsed under Section 31A-23a-113; or
3344 (e) voluntarily surrendered.
3345 (2) The following may be reinstated within one year after the day on which the license
3346 is no longer in force:
3347 (a) a lapsed license; or
3348 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
3349 not be reinstated after the license period in which the license is voluntarily surrendered.
3350 (3) Unless otherwise stated in a written agreement for the voluntary surrender of a
3351 license, submission and acceptance of a voluntary surrender of a license does not prevent the
3352 department from pursuing additional disciplinary or other action authorized under:
3353 (a) this title; or
3354 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
3355 Administrative Rulemaking Act.
3356 (4) A line of authority issued under this chapter remains in force until:
3357 (a) the qualifications pertaining to a line of authority are no longer met by the licensee;
3358 or
3359 (b) the supporting license type:
3360 (i) is revoked or suspended under Subsection (5);
3361 (ii) is surrendered to the commissioner and accepted by the commissioner in lieu of
3362 administrative action;
3363 (iii) lapses under Section 31A-23a-113; or
3364 (iv) is voluntarily surrendered; or
3365 (c) the licensee dies or is adjudicated incompetent as defined under:
3366 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
3367 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
3368 Minors.
3369 (5) (a) If the commissioner makes a finding under Subsection (5)(b), as part of an
3370 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
3371 commissioner may:
3372 (i) revoke:
3373 (A) a license; or
3374 (B) a line of authority;
3375 (ii) suspend for a specified period of 12 months or less:
3376 (A) a license; or
3377 (B) a line of authority;
3378 (iii) limit in whole or in part:
3379 (A) a license; or
3380 (B) a line of authority;
3381 (iv) deny a license application;
3382 (v) assess a forfeiture under Subsection 31A-2-308(1)(b)(i) or (1)(c)(i); or
3383 (vi) take a combination of actions under Subsections (5)(a)(i) through (iv) and
3384 Subsection (5)(a)(v).
3385 (b) The commissioner may take an action described in Subsection (5)(a) if the
3386 commissioner finds that the licensee:
3387 (i) is unqualified for a license or line of authority under Section 31A-23a-104,
3388 31A-23a-105, or 31A-23a-107;
3389 (ii) violates:
3390 (A) an insurance statute;
3391 (B) a rule that is valid under Subsection 31A-2-201(3); or
3392 (C) an order that is valid under Subsection 31A-2-201(4);
3393 (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
3394 delinquency proceedings in any state;
3395 (iv) fails to pay a final judgment rendered against the person in this state within 60
3396 days after the day on which the judgment became final;
3397 (v) fails to meet the same good faith obligations in claims settlement that is required of
3398 admitted insurers;
3399 (vi) is affiliated with and under the same general management or interlocking
3400 directorate or ownership as another insurance producer that transacts business in this state
3401 without a license;
3402 (vii) refuses:
3403 (A) to be examined; or
3404 (B) to produce its accounts, records, and files for examination;
3405 (viii) has an officer who refuses to:
3406 (A) give information with respect to the insurance producer's affairs; or
3407 (B) perform any other legal obligation as to an examination;
3408 (ix) provides information in the license application that is:
3409 (A) incorrect;
3410 (B) misleading;
3411 (C) incomplete; or
3412 (D) materially untrue;
3413 (x) violates an insurance law, valid rule, or valid order of another regulatory agency in
3414 any jurisdiction;
3415 (xi) obtains or attempts to obtain a license through misrepresentation or fraud;
3416 (xii) improperly withholds, misappropriates, or converts money or properties received
3417 in the course of doing insurance business;
3418 (xiii) intentionally misrepresents the terms of an actual or proposed:
3419 (A) insurance contract;
3420 (B) application for insurance; or
3421 (C) life settlement;
3422 (xiv) is convicted of:
3423 (A) a felony; or
3424 (B) a misdemeanor involving fraud, misrepresentation, theft, or dishonesty;
3425 (xv) admits or is found to have committed an insurance unfair trade practice or fraud;
3426 (xvi) in the conduct of business in this state or elsewhere:
3427 (A) uses fraudulent, coercive, or dishonest practices; or
3428 (B) demonstrates incompetence, untrustworthiness, or financial irresponsibility;
3429 (xvii) has had an insurance license or other professional or occupational license, or [
3430 an equivalent[
3431 (A) denied[
3432 (B) suspended[
3433 (C) revoked [
3434 (D) surrendered to resolve an administrative action;
3435 (xviii) forges another's name to:
3436 (A) an application for insurance; or
3437 (B) a document related to an insurance transaction;
3438 (xix) improperly uses notes or another reference material to complete an examination
3439 for an insurance license;
3440 (xx) knowingly accepts insurance business from an individual who is not licensed;
3441 (xxi) fails to comply with an administrative or court order imposing a child support
3442 obligation;
3443 (xxii) fails to:
3444 (A) pay state income tax; or
3445 (B) comply with an administrative or court order directing payment of state income
3446 tax;
3447 (xxiii) violates or permits others to violate the federal Violent Crime Control and Law
3448 Enforcement Act of 1994, 18 U.S.C. Sec. 1033 and therefore under 18 U.S.C. Sec. 1033 is
3449 prohibited from engaging in the business of insurance; or
3450 (xxiv) engages in a method or practice in the conduct of business that endangers the
3451 legitimate interests of customers and the public.
3452 (c) For purposes of this section, if a license is held by an agency, both the agency itself
3453 and any individual designated under the license are considered to be the holders of the license.
3454 (d) If an individual designated under the agency license commits an act or fails to
3455 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
3456 the commissioner may suspend, revoke, or limit the license of:
3457 (i) the individual;
3458 (ii) the agency, if the agency:
3459 (A) is reckless or negligent in its supervision of the individual; or
3460 (B) knowingly participates in the act or failure to act that is the ground for suspending,
3461 revoking, or limiting the license; or
3462 (iii) (A) the individual; and
3463 (B) the agency if the agency meets the requirements of Subsection (5)(d)(ii).
3464 (6) A licensee under this chapter is subject to the penalties for acting as a licensee
3465 without a license if:
3466 (a) the licensee's license is:
3467 (i) revoked;
3468 (ii) suspended;
3469 (iii) limited;
3470 (iv) surrendered in lieu of administrative action;
3471 (v) lapsed; or
3472 (vi) voluntarily surrendered; and
3473 (b) the licensee:
3474 (i) continues to act as a licensee; or
3475 (ii) violates the terms of the license limitation.
3476 (7) A licensee under this chapter shall immediately report to the commissioner:
3477 (a) a revocation, suspension, or limitation of the person's license in another state, the
3478 District of Columbia, or a territory of the United States;
3479 (b) the imposition of a disciplinary sanction imposed on that person by another state,
3480 the District of Columbia, or a territory of the United States; or
3481 (c) a judgment or injunction entered against that person on the basis of conduct
3482 involving:
3483 (i) fraud;
3484 (ii) deceit;
3485 (iii) misrepresentation; or
3486 (iv) a violation of an insurance law or rule.
3487 (8) (a) An order revoking a license under Subsection (5) or an agreement to surrender a
3488 license in lieu of administrative action may specify a time, not to exceed five years, within
3489 which the former licensee may not apply for a new license.
3490 (b) If no time is specified in an order or agreement described in Subsection (8)(a), the
3491 former licensee may not apply for a new license for five years from the day on which the order
3492 or agreement is made without the express approval by the commissioner.
3493 (9) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
3494 a license issued under this part if so ordered by a court.
3495 (10) The commissioner shall by rule prescribe the license renewal and reinstatement
3496 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
3497 Section 28. Section 31A-23a-208 is amended to read:
3498 31A-23a-208. Producer and agency authority in health insurance exchange.
3499 A producer or agency licensed under this chapter, with a line of authority that permits
3500 the producer or agency to sell, negotiate, or solicit accident and health insurance, is authorized
3501 to sell, negotiate, or solicit qualified health plans offered on [
3502 [
3503 [
3504 [
3505
3506 [
3507 [
3508 [
3509 Section 29. Section 31A-23a-406 is amended to read:
3510 31A-23a-406. Title insurance producer's business.
3511 (1) An individual title insurance producer or agency title insurance producer may do
3512 escrow involving real property transactions if all of the following exist:
3513 (a) the individual title insurance producer or agency title insurance producer is licensed
3514 with:
3515 (i) the title line of authority; and
3516 (ii) the escrow subline of authority;
3517 (b) the individual title insurance producer or agency title insurance producer is
3518 appointed by a title insurer authorized to do business in the state;
3519 (c) the individual title insurance producer or agency title insurance producer issues one
3520 or more of the following as part of the transaction:
3521 (i) an owner's policy of title insurance; [
3522 (ii) a lender's policy of title insurance; or
3523 (iii) if the transaction does not involve a transfer of ownership, an endorsement to an
3524 owner's or a lender's policy of title insurance;
3525 (d) money deposited with the individual title insurance producer or agency title
3526 insurance producer in connection with any escrow:
3527 (i) is deposited:
3528 (A) in a federally insured financial institution; and
3529 (B) in a trust account that is separate from all other trust account money that is not
3530 related to real estate transactions;
3531 (ii) is the property of the one or more persons entitled to the money under the
3532 provisions of the escrow; and
3533 (iii) is segregated escrow by escrow in the records of the individual title insurance
3534 producer or agency title insurance producer;
3535 (e) earnings on money held in escrow may be paid out of the escrow account to any
3536 person in accordance with the conditions of the escrow;
3537 (f) the escrow does not require the individual title insurance producer or agency title
3538 insurance producer to hold:
3539 (i) construction money; or
3540 (ii) money held for exchange under Section 1031, Internal Revenue Code; and
3541 (g) the individual title insurance producer or agency title insurance producer shall
3542 maintain a physical office in Utah staffed by a person with an escrow subline of authority who
3543 processes the escrow.
3544 (2) Notwithstanding Subsection (1), an individual title insurance producer or agency
3545 title insurance producer may engage in the escrow business if:
3546 (a) the escrow involves:
3547 (i) a mobile home;
3548 (ii) a grazing right;
3549 (iii) a water right; or
3550 (iv) other personal property authorized by the commissioner; and
3551 (b) the individual title insurance producer or agency title insurance producer complies
3552 with this section except for Subsection (1)(c).
3553 (3) Money held in escrow:
3554 (a) is not subject to any debts of the individual title insurance producer or agency title
3555 insurance producer;
3556 (b) may only be used to fulfill the terms of the individual escrow under which the
3557 money is accepted; and
3558 (c) may not be used until the conditions of the escrow are met.
3559 (4) Assets or property other than escrow money received by an individual title
3560 insurance producer or agency title insurance producer in accordance with an escrow shall be
3561 maintained in a manner that will:
3562 (a) reasonably preserve and protect the asset or property from loss, theft, or damages;
3563 and
3564 (b) otherwise comply with the general duties and responsibilities of a fiduciary or
3565 bailee.
3566 (5) (a) A check from the trust account described in Subsection (1)(d) may not be
3567 drawn, executed, or dated, or money otherwise disbursed unless the segregated escrow account
3568 from which money is to be disbursed contains a sufficient credit balance consisting of collected
3569 and cleared money at the time the check is drawn, executed, or dated, or money is otherwise
3570 disbursed.
3571 (b) As used in this Subsection (5), money is considered to be "collected and cleared,"
3572 and may be disbursed as follows:
3573 (i) cash may be disbursed on the same day the cash is deposited;
3574 (ii) a wire transfer may be disbursed on the same day the wire transfer is deposited; and
3575 (iii) the proceeds of one or more of the following financial instruments may be
3576 disbursed on the same day the financial instruments are deposited if received from a single
3577 party to the real estate transaction and if the aggregate of the financial instruments for the real
3578 estate transaction is less than $10,000:
3579 (A) a cashier's check, certified check, or official check that is drawn on an existing
3580 account at a federally insured financial institution;
3581 (B) a check drawn on the trust account of a principal broker or associate broker
3582 licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices Act, if the individual
3583 title insurance producer or agency title insurance producer has reasonable and prudent grounds
3584 to believe sufficient money will be available from the trust account on which the check is
3585 drawn at the time of disbursement of proceeds from the individual title insurance producer or
3586 agency title insurance producer's escrow account;
3587 (C) a personal check not to exceed $500 per closing; or
3588 (D) a check drawn on the escrow account of another individual title insurance producer
3589 or agency title insurance producer, if the individual title insurance producer or agency title
3590 insurance producer in the escrow transaction has reasonable and prudent grounds to believe
3591 that sufficient money will be available for withdrawal from the account upon which the check
3592 is drawn at the time of disbursement of money from the escrow account of the individual title
3593 insurance producer or agency title insurance producer in the escrow transaction.
3594 (c) A check or deposit not described in Subsection (5)(b) may be disbursed:
3595 (i) within the time limits provided under the Expedited Funds Availability Act, 12
3596 U.S.C. Sec. 4001 et seq., as amended, and related regulations of the Federal Reserve System; or
3597 (ii) upon notification from the financial institution to which the money has been
3598 deposited that final settlement has occurred on the deposited financial instrument.
3599 (6) An individual title insurance producer or agency title insurance producer shall
3600 maintain a record of a receipt or disbursement of escrow money.
3601 (7) An individual title insurance producer or agency title insurance producer shall
3602 comply with:
3603 (a) Section 31A-23a-409;
3604 (b) Title 46, Chapter 1, Notaries Public Reform Act; and
3605 (c) any rules adopted by the Title and Escrow Commission, subject to Section
3606 31A-2-404, that govern escrows.
3607 (8) If an individual title insurance producer or agency title insurance producer conducts
3608 a search for real estate located in the state, the individual title insurance producer or agency
3609 title insurance producer shall conduct a reasonable search of the public records.
3610 Section 30. Section 31A-23b-102 is amended to read:
3611 31A-23b-102. Definitions.
3612 As used in this chapter:
3613 (1) "Enroll" and "enrollment" mean to:
3614 (a) (i) obtain personally identifiable information about an individual; and
3615 (ii) inform an individual about accident and health insurance plans or public programs
3616 offered on an exchange;
3617 (b) solicit insurance; or
3618 (c) submit to the exchange:
3619 (i) personally identifiable information about an individual; and
3620 (ii) an individual's selection of a particular accident and health insurance plan or public
3621 program offered on the exchange.
3622 [
3623
3624
3625 [
3626
3627
3628 [
3629 (a) means a person who facilitates enrollment in an exchange by offering to assist, or
3630 who advertises any services to assist, with:
3631 (i) the selection of and enrollment in a qualified health plan or a public program
3632 offered on an exchange; or
3633 (ii) applying for premium subsidies through an exchange; and
3634 (b) includes a person who is an in-person assister or a certified application counselor as
3635 described in federal regulations or guidance issued under PPACA.
3636 [
3637 [
3638 Medical Assistance Act, and Title 26, Chapter 40, Utah Children's Health Insurance Act.
3639 [
3640 Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
3641 [
3642 31A-23a-102.
3643 Section 31. Section 31A-23b-202.5 is amended to read:
3644 31A-23b-202.5. License types.
3645 (1) A license issued under this chapter shall be issued under the license types described
3646 in Subsection (2).
3647 (2) A license type under this chapter shall be a navigator line of authority or a certified
3648 application counselor line of authority. A license type is intended to describe the matters to be
3649 considered under any education, examination, and training required of an applicant under this
3650 chapter.
3651 (3) (a) A navigator line of authority includes the enrollment process as described in
3652 Subsection 31A-23b-102[
3653 (b) (i) A certified application counselor line of authority is limited to providing
3654 information and assistance to individuals and employees about public programs and premium
3655 subsidies available through the exchange.
3656 (ii) A certified application counselor line of authority does not allow the certified
3657 application counselor to assist a person with the selection of or enrollment in a qualified health
3658 plan offered on an exchange.
3659 Section 32. Section 31A-23b-204 is amended to read:
3660 31A-23b-204. Character requirements.
3661 An applicant for a license under this chapter shall demonstrate to the commissioner
3662 that:
3663 (1) the applicant has the intent, in good faith, to engage in the practice of a navigator as
3664 the license would permit;
3665 (2) (a) if a natural person, the applicant is:
3666 (i) competent; and
3667 (ii) trustworthy; or
3668 (b) if the applicant is an agency:
3669 (i) the partners, directors, or principal officers or persons having comparable powers
3670 are trustworthy; and
3671 (ii) that it will transact business in a way that the acts that may only be performed by a
3672 licensed navigator are performed only by a natural person who is licensed under this chapter, or
3673 Chapter 23a, Insurance Marketing-Licensing Producers, Consultants, and Reinsurance
3674 Intermediaries;
3675 (3) the applicant intends to comply with the surety bond requirements of Section
3676 31A-23b-207;
3677 (4) if a natural person, the applicant is at least 18 years of age; and
3678 (5) the applicant does not have a conflict of interest as defined by regulations issued
3679 under PPACA.
3680 Section 33. Section 31A-23b-205 is amended to read:
3681 31A-23b-205. Examination and training requirements.
3682 (1) The commissioner may require an applicant for a license to pass an examination
3683 and complete a training program as a requirement for a license.
3684 (2) The examination described in Subsection (1) shall reasonably relate to:
3685 (a) the duties and functions of a navigator;
3686 (b) requirements for navigators as established by federal regulation under PPACA; and
3687 (c) other requirements that may be established by the commissioner by administrative
3688 rule.
3689 (3) The examination may be administered by the commissioner or as otherwise
3690 specified by administrative rule.
3691 (4) The training required by Subsection (1) shall be approved by the commissioner and
3692 shall include:
3693 (a) accident and health insurance plans;
3694 (b) qualifications for and enrollment in public programs;
3695 (c) qualifications for and enrollment in premium subsidies;
3696 (d) cultural and linguistic competence;
3697 (e) conflict of interest standards;
3698 (f) exchange functions; and
3699 (g) other requirements that may be adopted by the commissioner by administrative
3700 rule.
3701 (5) (a) For the navigator line of authority, the training required by Subsection (1) shall
3702 consist of at least 21 credit hours of training before obtaining the license, which shall
3703 include[
3704
3705 developed by the Centers for Medicare and Medicaid Services.
3706 (b) For the certified application counselor line of authority, the training required by
3707 Subsection (1) shall consist of at least six hours of training before obtaining a license, which
3708 shall include[
3709
3710 and certification program developed by the Centers for Medicare and Medicaid Services.
3711 (6) This section applies only to an applicant who is a natural person.
3712 Section 34. Section 31A-23b-206 is amended to read:
3713 31A-23b-206. Continuing education requirements.
3714 (1) The commissioner shall, by rule, prescribe continuing education requirements for a
3715 navigator.
3716 (2) (a) The commissioner may not require a degree from an institution of higher
3717 education as part of continuing education.
3718 (b) The commissioner may state a continuing education requirement in terms of hours
3719 of instruction received in:
3720 (i) accident and health insurance;
3721 (ii) qualification for and enrollment in public programs;
3722 (iii) qualification for and enrollment in premium subsidies;
3723 (iv) cultural competency;
3724 (v) conflict of interest standards; and
3725 (vi) other exchange functions.
3726 (3) (a) For a navigator line of authority, continuing education requirements shall
3727 require:
3728 (i) that a licensee complete 12 credit hours of continuing education for every one-year
3729 licensing period;
3730 (ii) that at least two of the 12 credit hours described in Subsection (3)(a)(i) be ethics
3731 courses; and
3732 [
3733
3734
3735 [
3736 program developed by the Centers for Medicare and Medicaid Services.
3737 (b) For a certified application counselor, the continuing education requirements shall
3738 require:
3739 (i) that a licensee complete six credit hours of continuing education for every one-year
3740 licensing period;
3741 (ii) that at least two of the six credit hours described in Subsection (3)(b)(i) be on
3742 ethics courses; and
3743 [
3744
3745
3746 [
3747 and certification program developed by the Centers for Medicare and Medicaid Services.
3748 (c) An hour of continuing education in accordance with Subsections (3)(a)(i) and (b)(i)
3749 may be obtained through:
3750 (i) classroom attendance;
3751 (ii) home study;
3752 (iii) watching a video recording; or
3753 (iv) another method approved by rule.
3754 (d) A licensee may obtain continuing education hours at any time during the one-year
3755 license period.
3756 (e) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3757 commissioner shall, by rule, authorize one or more continuing education providers, including a
3758 state or national professional producer or consultant associations, to:
3759 (i) offer a qualified program on a geographically accessible basis; and
3760 (ii) collect a reasonable fee for funding and administration of a continuing education
3761 program, subject to the review and approval of the commissioner.
3762 (4) The commissioner shall approve a continuing education provider or a continuing
3763 education course that satisfies the requirements of this section.
3764 (5) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3765 commissioner shall by rule establish the procedures for continuing education provider
3766 registration and course approval.
3767 (6) This section applies only to a navigator who is a natural person.
3768 (7) A navigator shall keep documentation of completing the continuing education
3769 requirements of this section for one year after the end of the one-year licensing period to which
3770 the continuing education applies.
3771 Section 35. Section 31A-25-204 is amended to read:
3772 31A-25-204. Character requirements.
3773 Each applicant for a license under this chapter shall show to the commissioner all of the
3774 following:
3775 (1) [
3776 business the license applied for would permit;
3777 (2) (a) if a natural person, [
3778 (i) competent; and
3779 (ii) trustworthy[
3780 (b) if a partnership or corporation, that all the partners, directors, principal officers, or
3781 persons having comparable powers are trustworthy; and
3782 (3) if a natural person, [
3783 Section 36. Section 31A-25-206 is amended to read:
3784 31A-25-206. Nonresident jurisdictional agreement.
3785 (1) (a) If a nonresident license applicant has a valid license from the nonresident license
3786 applicant's home state or designated home state and the conditions of Subsection (1)(b) are
3787 met, the commissioner shall:
3788 (i) waive any license requirement for a license under this chapter; and
3789 (ii) issue the nonresident license applicant a nonresident third party administrator
3790 license.
3791 (b) Subsection (1)(a) applies if:
3792 (i) the nonresident license applicant:
3793 (A) is licensed [
3794 designated home state at the time the nonresident license applicant applies for a nonresident
3795 third party administrator license;
3796 (B) has submitted the proper request for licensure;
3797 (C) has submitted to the commissioner:
3798 (I) the application for licensure that the nonresident license applicant submitted to the
3799 applicant's home state or designated home state; or
3800 (II) a completed uniform application; and
3801 (D) has paid the applicable fees under Section 31A-3-103;
3802 (ii) the nonresident license applicant's license in the applicant's home state or
3803 designated home state is in good standing; and
3804 (iii) the nonresident license applicant's home state or designated home state awards
3805 nonresident third party administrator licenses to residents of this state on the same basis as this
3806 state awards licenses to residents of that home state or designated home state.
3807 (2) A nonresident applicant shall execute in a form acceptable to the commissioner an
3808 agreement to be subject to the jurisdiction of the Utah commissioner and courts on any matter
3809 related to the applicant's insurance activities in Utah, on the basis of:
3810 (a) service of process under Sections 31A-2-309 and 31A-2-310; or
3811 (b) other service authorized in the Utah Rules of Civil Procedure.
3812 (3) The commissioner may verify the third party administrator's licensing status
3813 through the database maintained by:
3814 (a) the National Association of Insurance Commissioners; or
3815 (b) an affiliate or subsidiary of the National Association of Insurance Commissioners.
3816 (4) The commissioner may not assess a greater fee for an insurance license or related
3817 service to a person not residing in this state based solely on the fact that the person does not
3818 reside in this state.
3819 Section 37. Section 31A-26-102 is amended to read:
3820 31A-26-102. Definitions.
3821 As used in this chapter, unless expressly provided otherwise:
3822 (1) "Company adjuster" means a person employed by an insurer [
3823
3824 who negotiates or settles claims on behalf of the employer.
3825 (2) "Designated home state" means the state or territory of the United States or the
3826 District of Columbia:
3827 (a) in which an insurance adjuster does not maintain the adjuster's principal:
3828 (i) place of residence; or
3829 (ii) place of business;
3830 (b) if the resident state, territory, or District of Columbia of the adjuster does not
3831 license adjusters for the line of authority sought, the adjuster has qualified for the license as if
3832 the person were a resident in the state, territory, or District of Columbia described in
3833 Subsection (2)(a), including an applicable:
3834 (i) examination requirement;
3835 (ii) fingerprint background check requirement; and
3836 (iii) continuing education requirement; and
3837 (c) the adjuster has designated the state, territory, or District of Columbia as the
3838 designated home state.
3839 (3) "Home state" means:
3840 (a) a state or territory of the United States or the District of Columbia in which an
3841 insurance adjuster:
3842 (i) maintains the adjuster's principal:
3843 (A) place of residence; or
3844 (B) place of business; and
3845 (ii) is licensed to act as a resident adjuster; or
3846 (b) if the resident state, territory, or the District of Columbia described in Subsection
3847 (3)(a) does not license adjusters for the line of authority sought, a state, territory, or the District
3848 of Columbia:
3849 (i) in which the adjuster is licensed;
3850 (ii) in which the adjuster is in good standing; and
3851 (iii) that the adjuster has designated as the adjuster's designated home state.
3852 (4) "Independent adjuster" means an insurance adjuster required to be licensed under
3853 Section 31A-26-201, who engages in insurance adjusting as a representative of one or more
3854 insurers.
3855 (5) "Insurance adjusting" or "adjusting" means directing or conducting the
3856 investigation, negotiation, or settlement of a claim under an insurance policy, on behalf of an
3857 insurer, policyholder, or a claimant under an insurance policy.
3858 (6) "Organization" means a person other than a natural person, and includes a sole
3859 proprietorship by which a natural person does business under an assumed name.
3860 (7) "Portable electronics insurance" is as defined in Section 31A-22-1802.
3861 (8) "Public adjuster" means a person required to be licensed under Section
3862 31A-26-201, who engages in insurance adjusting as a representative of insureds and claimants
3863 under insurance policies.
3864 Section 38. Section 31A-26-205 is amended to read:
3865 31A-26-205. Character requirements.
3866 Each applicant for a license under this chapter shall show to the commissioner that:
3867 (1) [
3868 license or licenses applied for would permit;
3869 (2) (a) if a natural person, [
3870 (i) competent; and
3871 (ii) trustworthy[
3872 (b) if an organization, all the partners, directors, principal officers, or persons in fact
3873 having comparable powers are trustworthy, and that [
3874 such a way that all acts that may only be performed by a licensed adjuster are performed
3875 exclusively by natural persons who are licensed under this chapter to transact that business and
3876 listed on the organization's license under Section 31A-26-209; and
3877 (3) if a natural person, [
3878 Section 39. Section 31A-26-208 is amended to read:
3879 31A-26-208. Nonresident jurisdictional agreement.
3880 (1) (a) If a nonresident license applicant has a valid license from the nonresident
3881 license applicant's home state or designated home state and the conditions of Subsection (1)(b)
3882 are met, the commissioner shall:
3883 (i) waive any license requirement for a license under this chapter; and
3884 (ii) issue the nonresident license applicant a nonresident adjuster's license.
3885 (b) Subsection (1)(a) applies if:
3886 (i) the nonresident license applicant:
3887 (A) is licensed [
3888 designated home state at the time the nonresident license applicant applies for a nonresident
3889 adjuster license;
3890 (B) has submitted the proper request for licensure;
3891 (C) has submitted to the commissioner:
3892 (I) the application for licensure that the nonresident license applicant submitted to the
3893 applicant's home state or designated home state; or
3894 (II) a completed uniform application; and
3895 (D) has paid the applicable fees under Section 31A-3-103;
3896 (ii) the nonresident license applicant's license in the applicant's home state or
3897 designated home state is in good standing; and
3898 (iii) the nonresident license applicant's home state or designated home state awards
3899 nonresident adjuster licenses to residents of this state on the same basis as this state awards
3900 licenses to residents of that home state or designated home state.
3901 (2) A nonresident applicant shall execute in a form acceptable to the commissioner an
3902 agreement to be subject to the jurisdiction of the commissioner and courts of this state on any
3903 matter related to the adjuster's insurance activities in this state, on the basis of:
3904 (a) service of process under Sections 31A-2-309 and 31A-2-310; or
3905 (b) other service authorized under the Utah Rules of Civil Procedure or Section
3906 78B-3-206.
3907 (3) The commissioner may verify an adjuster's licensing status through the database
3908 maintained by:
3909 (a) the National Association of Insurance Commissioners; or
3910 (b) an affiliate or subsidiary of the National Association of Insurance Commissioners.
3911 (4) The commissioner may not assess a greater fee for an insurance license or related
3912 service to a person not residing in this state based solely on the fact that the person does not
3913 reside in this state.
3914 Section 40. Section 31A-27a-111 is amended to read:
3915 31A-27a-111. Actions by and against the receiver.
3916 (1) (a) An allegation by the receiver of improper or fraudulent conduct against a person
3917 may not be the basis of a defense to the enforcement of a contractual obligation owed to the
3918 insurer by a third party.
3919 (b) Notwithstanding Subsection (1)(a), a third party described in this Subsection (1) is
3920 not barred by this section from seeking to establish independently as a defense that the conduct
3921 is materially and substantially related to the contractual obligation for which enforcement is
3922 sought.
3923 (2) (a) Subject to Subsection (2)(b), a prior wrongful or negligent action of any present
3924 or former officer, manager, director, trustee, owner, employee, or agent of the insurer may not
3925 be asserted as a defense to a claim by the receiver:
3926 (i) under a theory of:
3927 (A) estoppel;
3928 (B) comparative fault;
3929 (C) intervening cause;
3930 (D) proximate cause;
3931 (E) reliance; or
3932 (F) mitigation of damages; or
3933 (ii) otherwise.
3934 (b) Notwithstanding Subsection (2)(a):
3935 (i) the affirmative defense of fraud in the inducement may be asserted against the
3936 receiver in a claim based on a contract; and
3937 (ii) a principal under a surety bond or a surety undertaking is entitled to credit against
3938 any reimbursement obligation to the receiver for the value of any property pledged to secure the
3939 reimbursement obligation to the extent that:
3940 (A) the receiver has possession or control of the property; or
3941 (B) the insurer or its agents misappropriated, including commingling, the property.
3942 (c) Evidence of fraud in the inducement is admissible only if it is contained in the
3943 records of the insurer.
3944 (3) Action or inaction by an insurance regulatory authority may not be asserted as a
3945 defense to a claim by the receiver.
3946 (4) (a) Subject to Subsection (4)(b), a judgment or order entered against an insured or
3947 the insurer in contravention of a stay or injunction under this chapter, or at any time by default
3948 or collusion, may not be considered as evidence of liability or of the quantum of damages in
3949 adjudicating claims filed in the estate arising out of the subject matter of the judgment or order.
3950 (b) Subsection (4)(a) does not apply to an affected guaranty association's claim for
3951 amounts paid on a settlement or judgment in pursuit of the affected guaranty association's
3952 statutory obligations.
3953 (5) (a) Subject to Subsection (5)(b), the following do not affect the amount that a
3954 receiver may recover from a third party, regardless of any provision in an agreement to the
3955 contrary:
3956 (i) the insurer's insolvency; or
3957 (ii) the insurer's or receiver's failure to pay all or a portion of an amount or a claim to
3958 the third party.
3959 (b) If an agreement between the insurer and a third party requires a payment by the
3960 insurer before the insurer may recover from the third party, the amount the receiver may
3961 recover from the third party under Subsection (5)(a) is limited to an amount equal to the greater
3962 of:
3963 (i) the amount paid by the insurer or by another person on behalf of the insurer to the
3964 third party; or
3965 (ii) the amount allowed as a claim for payment under:
3966 (A) an approved report described in Section 31A-27a-608;
3967 (B) an order of the receivership court; or
3968 (C) a plan of rehabilitation.
3969 [
3970 any state law awarding fees to a litigant who prevails against a governmental entity.
3971 Section 41. Section 31A-27a-608 is amended to read:
3972 31A-27a-608. Liquidator's recommendations to the receivership court.
3973 (1) The liquidator shall, from time to time as determined by the liquidator, present to
3974 the receivership court for approval, reports of claims settled or determined by the liquidator
3975 under Section 31A-27a-603.
3976 (2) A report required by this section shall include information identifying:
3977 (a) the claim;
3978 (b) the amount of the claim; and
3979 (c) the priority class of the claim.
3980 (3) (a) A claim included in a report described in this section and approved by the
3981 receivership court is a liability of the estate.
3982 (b) An insurer's insolvency does not affect the amount of a liability described in
3983 Subsection (3)(a), regardless of any provision in an agreement to the contrary.
3984 Section 42. Section 31A-30-210 is amended to read:
3985 31A-30-210. State contract requirements -- Employer default plans.
3986 (1) This section applies to an employer who is required to offer [
3987 employees a health benefit plan as a condition of qualifying for a state contract under:
3988 (a) Section 17B-2a-818.5;
3989 (b) Section 19-1-206;
3990 [
3991 (c) Subsection 63A-5-205.5;
3992 (d) Section 63C-9-403;
3993 (e) Section 72-6-107.5; and
3994 (f) Section 79-2-404.
3995 (2) An employer described in Subsection (1) shall, when selecting the default plan
3996 required in Section 31A-30-204, select a default plan that is "qualified health insurance
3997 coverage" as defined in the sections listed in Subsections (1)(a) through (f).
3998 Section 43. Section 31A-43-303 is amended to read:
3999 31A-43-303. Stop-loss insurance disclosure.
4000 A stop-loss insurance contract delivered, issued for delivery, or entered into shall
4001 include the disclosure exhibit required by the commissioner through administrative rule, which
4002 shall include at least the following information:
4003 (1) the complete costs for the stop-loss contract;
4004 (2) the date on which the insurance takes effect and terminates, including renewability
4005 provisions;
4006 (3) the aggregate attachment point and the specific attachment point;
4007 (4) limitations on coverage;
4008 (5) an explanation of monthly accommodation and disclosure about any monthly
4009 accommodation features included in the stop-loss contract;
4010 (6) a description of terminal liability funding, including the cost of processing claims
4011 before and after the termination of the contract; [
4012 (7) maximum claims liability to the employer[
4013 (8) a summary of the policy.
4014 Section 44. Section 31A-45-403 is enacted to read:
4015 31A-45-403. Essential health benefits.
4016 (1) The state designates the state's own essential health benefits and does not accept a
4017 federal determination of the essential health benefits under the PPACA.
4018 (2) Subject to Subsections (3) and (4), the commissioner shall make rules in
4019 accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, that designate the
4020 essential health benefits for the state.
4021 (3) Before the commissioner makes rules in accordance with Subsection (2):
4022 (a) the commissioner shall present a summary of the commissioner's planned rules to
4023 the Health Reform Task Force; and
4024 (b) the Health Reform Task Force shall recommend whether the commissioner makes
4025 rules in accordance with the presented summary.
4026 (4) The essential health benefits plan:
4027 (a) may not include a state mandate if the inclusion of the state mandate would require
4028 the state to contribute to premium subsidies under the PPACA; and
4029 (b) may add benefits in addition to the benefits included in a benchmark plan adopted
4030 in accordance with this section if the additional benefits are mandated under the PPACA.
4031 Section 45. Section 34A-2-107 is amended to read:
4032 34A-2-107. Appointment of workers' compensation advisory council --
4033 Composition -- Terms of members -- Duties -- Compensation.
4034 (1) The commissioner shall appoint a workers' compensation advisory council
4035 composed of:
4036 (a) the following voting members:
4037 (i) five employer representatives; and
4038 (ii) five employee representatives; and
4039 (b) the following nonvoting members:
4040 (i) a representative of the workers' compensation insurance carrier that provides
4041 workers' compensation insurance under Section 31A-22-1001;
4042 (ii) a representative of a workers' compensation insurance carrier different from the
4043 workers' compensation insurance carrier listed in Subsection (1)(b)(i);
4044 (iii) a representative of health care providers;
4045 (iv) the Utah insurance commissioner or the insurance commissioner's designee; and
4046 (v) the commissioner or the commissioner's designee.
4047 (2) Employers and employees shall consider nominating members of groups who
4048 historically may have been excluded from the council, such as women, minorities, and
4049 individuals with disabilities.
4050 (3) (a) Except as required by Subsection (3)(b), as terms of current council members
4051 expire, the commissioner shall appoint each new member or reappointed member to a two-year
4052 term beginning July 1 and ending June 30.
4053 (b) Notwithstanding the requirements of Subsection (3)(a), the commissioner shall, at
4054 the time of appointment or reappointment, adjust the length of terms to ensure that the terms of
4055 council members are staggered so that approximately half of the council is appointed every two
4056 years.
4057 (4) (a) When a vacancy occurs in the membership for any reason, the replacement shall
4058 be appointed for the unexpired term.
4059 (b) The commissioner shall terminate the term of a council member who ceases to be
4060 representative as designated by the member's original appointment.
4061 (5) The council shall confer at least quarterly for the purpose of advising the
4062 commission, the division, and the Legislature on:
4063 (a) the Utah workers' compensation and occupational disease laws;
4064 (b) the administration of the laws described in Subsection (5)(a); and
4065 (c) rules related to the laws described in Subsection (5)(a).
4066 (6) Regarding workers' compensation, rehabilitation, and reemployment of employees
4067 who acquire a disability because of an industrial injury or occupational disease the council
4068 shall:
4069 (a) offer advice on issues requested by:
4070 (i) the commission;
4071 (ii) the division; and
4072 (iii) the Legislature; and
4073 (b) make recommendations to:
4074 (i) the commission; and
4075 (ii) the division.
4076 [
4077
4078
4079
4080 (7) (a) The council shall:
4081 (i) study how to reduce hospital costs for purposes of medical benefits for workers'
4082 compensation;
4083 (ii) study hospital billing and payment trends in the state;
4084 (iii) study hospital fee schedules used in other states; and
4085 (iv) collect information from third-party hospital bill review companies in the state or
4086 region to identify an average reimbursement rate that represents the approximate rate at which
4087 a workers' compensation insurance carrier or self-insured employer should expect to reimburse
4088 a hospital for billed hospital fees for covered medical services in the state.
4089 (b) In accordance with Section 68-3-14, the council shall submit a written report to the
4090 Business and Labor Interim Committee no later than September 1, 2019, 2020, and 2021. Each
4091 written report shall include:
4092 (i) recommendations on how to reduce hospital costs for purposes of medical benefits
4093 for workers' compensation;
4094 (ii) aggregate data on hospital billing and payment trends in the state;
4095 (iii) the results of the council's study of hospital fee schedules from other states; and
4096 (iv) the approximate rate at which a workers' compensation insurance carrier or
4097 self-insured employer should expect to reimburse a hospital for billed hospital fees for covered
4098 medical services, calculated in accordance with Subsection (7)(a)(iv).
4099 (c) For each report described in Subsection (7)(b), the commission may contract with a
4100 third-party expert to assist with the council's duties described in Subsections (7)(a) and (b).
4101 (8) The commissioner or the commissioner's designee shall serve as the chair of the
4102 council and call the necessary meetings.
4103 (9) The commission shall provide staff support to the council.
4104 (10) A member may not receive compensation or benefits for the member's service, but
4105 may receive per diem and travel expenses in accordance with:
4106 (a) Section 63A-3-106;
4107 (b) Section 63A-3-107; and
4108 (c) rules made by the Division of Finance pursuant to Sections 63A-3-106 and
4109 63A-3-107.
4110 Section 46. Section 34A-2-705 is amended to read:
4111 34A-2-705. Industrial Accident Restricted Account.
4112 (1) As used in this section:
4113 (a) "Account" means the Industrial Accident Restricted Account created by this
4114 section.
4115 (b) "Advisory council" means the state workers' compensation advisory council created
4116 under Section 34A-2-107.
4117 (2) There is created in the General Fund a restricted account known as the "Industrial
4118 Accident Restricted Account."
4119 (3) (a) The account is funded from:
4120 (i) .5% of the premium income remitted to the state treasurer and credited to the
4121 account pursuant to Subsection 59-9-101(2)(c)(iv); and
4122 (ii) amounts deposited under Section 34A-2-1003.
4123 (b) If the balance in the account exceeds $500,000 at the close of a fiscal year, the
4124 excess shall be transferred to the Uninsured Employers' Fund created under Section 34A-2-704.
4125 (4) (a) From money appropriated by the Legislature from the account to the
4126 commission and subject to the requirements of this section, the commission may fund:
4127 (i) the activities of the Division of Industrial Accidents described in Section
4128 34A-1-202;
4129 (ii) the activities of the Division of Adjudication described in Section 34A-1-202;
4130 [
4131 (iii) the activities of the commission described in Section 34A-2-1005[
4132 (iv) the activities of the commission described in Subsection 34A-2-107(7)(c), up to
4133 $50,000 for each of the three reports described in Subsection 34A-2-107(7)(b).
4134 (b) The money deposited in the account may not be used for a purpose other than a
4135 purpose described in this Subsection (4), including an administrative cost or another activity of
4136 the commission unrelated to the account.
4137 (5) (a) Each year before the public hearing required by Subsection 59-9-101(2)(d)(i),
4138 the commission shall report to the advisory council regarding:
4139 (i) the commission's budget request to the governor for the next fiscal year related to:
4140 (A) the Division of Industrial Accidents; and
4141 (B) the Division of Adjudication;
4142 (ii) the expenditures of the commission for the fiscal year in which the commission is
4143 reporting related to:
4144 (A) the Division of Industrial Accidents; and
4145 (B) the Division of Adjudication;
4146 (iii) revenues generated from the premium assessment under Section 59-9-101 on an
4147 admitted insurer writing workers' compensation insurance in this state and on a self-insured
4148 employer under Section 34A-2-202; and
4149 (iv) money deposited under Section 34A-2-1003.
4150 (b) The commission shall annually report to the governor and the Legislature
4151 regarding:
4152 (i) the use of the money appropriated to the commission under this section;
4153 (ii) revenues generated from the premium assessment under Section 59-9-101 on an
4154 admitted insurer writing workers' compensation insurance in this state and on a self-insured
4155 employer under Section 34A-2-202; and
4156 (iii) money deposited under Section 34A-2-1003.
4157 Section 47. Section 63A-5-205 is amended to read:
4158 63A-5-205. Contracting powers of director -- Retainage.
4159 [
4160 [
4161
4162 [
4163
4164 [
4165
4166 [
4167 [
4168
4169 [
4170
4171 [
4172
4173 [
4174 [
4175 director may:
4176 (a) subject to [
4177 contract for any work or professional services [
4178 Board may do or have done; and
4179 (b) as a condition of any contract for architectural or engineering services, prohibit the
4180 architect or engineer from retaining a sales or agent engineer for the necessary design work.
4181 [
4182 [
4183
4184 [
4185
4186 [
4187
4188 [
4189 [
4190 [
4191 [
4192 [
4193
4194 [
4195
4196 [
4197
4198
4199 [
4200
4201 [
4202
4203
4204 [
4205
4206
4207 [
4208
4209
4210 [
4211
4212 [
4213
4214
4215 [
4216
4217 [
4218 [
4219 [
4220 [
4221 [
4222 [
4223 [
4224 [
4225 [
4226 [
4227 [
4228
4229 [
4230
4231 [
4232
4233 [
4234
4235
4236
4237
4238
4239 [
4240
4241 [
4242
4243 [
4244
4245 [
4246
4247 [
4248
4249
4250
4251 [
4252
4253
4254 [
4255
4256
4257
4258 [
4259
4260 [
4261
4262 [
4263 [
4264
4265 [
4266
4267 [
4268
4269 [
4270
4271 [
4272
4273 [
4274
4275
4276 [
4277
4278
4279 [
4280 bidder is conclusive, except in case of fraud or bad faith.
4281 [
4282 accordance with the contract and pay the interest specified in the contract on any payments that
4283 are late.
4284 [
4285 division or the State Building Board is retained or withheld, it shall be retained or withheld and
4286 released as provided in Section 13-8-5.
4287 Section 48. Section 63A-5-205.5 is enacted to read:
4288 63A-5-205.5. Health insurance requirements -- Penalties.
4289 (1) As used in this section:
4290 (a) "Aggregate" means the sum of all contracts, change orders, and modifications
4291 related to a single project.
4292 (b) "Change order" means the same as that term is defined in Section 63G-6a-103.
4293 (c) "Employee" means, as defined in Section 34A-2-104, an "employee," "worker," or
4294 "operative" who:
4295 (i) works at least 30 hours per calendar week; and
4296 (ii) meets employer eligibility waiting requirements for health care insurance, which
4297 may not exceed the first day of the calendar month following 60 days after the day on which
4298 the individual is hired.
4299 (d) "Health benefit plan" means the same as that term is defined in Section 31A-1-301.
4300 (e) "Qualified health insurance coverage" means the same as that term is defined in
4301 Section 26-40-115.
4302 (f) "Subcontractor" means the same as that term is defined in Section 63A-5-208.
4303 (2) Except as provided in Subsection (3), the requirements of this section apply to:
4304 (a) a contractor of a design or construction contract entered into by the division or the
4305 State Building Board on or after July 1, 2009, if the prime contract is in an aggregate amount
4306 equal to or greater than $2,000,000; and
4307 (b) a subcontractor of a contractor of a design or construction contract entered into by
4308 the division or State Building Board on or after July 1, 2009, if the subcontract is in an
4309 aggregate amount equal to or greater than $1,000,000.
4310 (3) The requirements of this section do not apply to a contractor or subcontractor
4311 described in Subsection (2) if:
4312 (a) the application of this section jeopardizes the receipt of federal funds;
4313 (b) the contract is a sole source contract; or
4314 (c) the contract is an emergency procurement.
4315 (4) A person that intentionally uses change orders, contract modifications, or multiple
4316 contracts to circumvent the requirements of this section is guilty of an infraction.
4317 (5) (a) A contractor that is subject to the requirements of this section shall demonstrate
4318 to the director that the contractor has and will maintain an offer of qualified health insurance
4319 coverage for the contractor's employees and the employees' dependents by submitting to the
4320 director a written statement that:
4321 (i) the contractor offers qualified health insurance coverage that complies with Section
4322 26-40-115;
4323 (ii) is from:
4324 (A) an actuary selected by the contractor or the contractor's insurer; or
4325 (B) an underwriter who is responsible for developing the employer group's premium
4326 rates; and
4327 (iii) was created within one year before the day on which the statement is submitted.
4328 (b) A contractor that is subject to the requirements of this section shall:
4329 (i) place a requirement in each of the contractor's subcontracts that a subcontractor that
4330 is subject to the requirements of this section shall obtain and maintain an offer of qualified
4331 health insurance coverage for the subcontractor's employees and the employees' dependents
4332 during the duration of the subcontract; and
4333 (ii) obtain from a subcontractor that is subject to the requirements of this section a
4334 written statement that:
4335 (A) the subcontractor offers qualified health insurance coverage that complies with
4336 Section 26-40-115;
4337 (B) is from an actuary selected by the subcontractor or the subcontractor's insurer, or an
4338 underwriter who is responsible for developing the employer group's premium rates; and
4339 (C) was created within one year before the day on which the contractor obtains the
4340 statement.
4341 (c) (i) (A) A contractor that fails to maintain an offer of qualified health insurance
4342 coverage described in Subsection (5)(a) during the duration of the contract is subject to
4343 penalties in accordance with administrative rules adopted by the division under Subsection (6).
4344 (B) A contractor is not subject to penalties for the failure of a subcontractor to obtain
4345 and maintain an offer of qualified health insurance coverage described in Subsection (5)(b)(i).
4346 (ii) (A) A subcontractor that fails to obtain and maintain an offer of qualified health
4347 insurance coverage described in Subsection (5)(b)(i) during the duration of the subcontract is
4348 subject to penalties in accordance with administrative rules adopted by the division under
4349 Subsection (6).
4350 (B) A subcontractor is not subject to penalties for the failure of a contractor to maintain
4351 an offer of qualified health insurance coverage described in Subsection (5)(a).
4352 (6) The division shall adopt administrative rules:
4353 (a) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
4354 (b) in coordination with:
4355 (i) the Department of Environmental Quality in accordance with Section 19-1-206;
4356 (ii) the Department of Natural Resources in accordance with Section 79-2-404;
4357 (iii) a public transit district in accordance with Section 17B-2a-818.5;
4358 (iv) the State Capitol Preservation Board in accordance with Section 63C-9-403;
4359 (v) the Department of Transportation in accordance with Section 72-6-107.5; and
4360 (vi) the Legislature's Administrative Rules Review Committee; and
4361 (c) that establish:
4362 (i) the requirements and procedures a contractor and a subcontractor shall follow to
4363 demonstrate compliance with this section, including:
4364 (A) that a contractor or subcontractor's compliance with this section is subject to an
4365 audit by the division or the Office of the Legislative Auditor General;
4366 (B) that a contractor that is subject to the requirements of this section shall obtain a
4367 written statement described in Subsection (5)(a); and
4368 (C) that a subcontractor that is subject to the requirements of this section shall obtain a
4369 written statement described in Subsection (5)(b)(ii);
4370 (ii) the penalties that may be imposed if a contractor or subcontractor intentionally
4371 violates the provisions of this section, which may include:
4372 (A) a three-month suspension of the contractor or subcontractor from entering into
4373 future contracts with the state upon the first violation;
4374 (B) a six-month suspension of the contractor or subcontractor from entering into future
4375 contracts with the state upon the second violation;
4376 (C) an action for debarment of the contractor or subcontractor in accordance with
4377 Section 63G-6a-904 upon the third or subsequent violation; and
4378 (D) monetary penalties which may not exceed 50% of the amount necessary to
4379 purchase qualified health insurance coverage for employees and dependents of employees of
4380 the contractor or subcontractor who were not offered qualified health insurance coverage
4381 during the duration of the contract; and
4382 (iii) a website on which the department shall post the commercially equivalent
4383 benchmark for the qualified health insurance coverage that is provided by the Department of
4384 Health in accordance with Subsection 26-40-115(2).
4385 (7) (a) During the duration of a contract, the division may perform an audit to verify a
4386 contractor or subcontractor's compliance with this section.
4387 (b) Upon the division's request, a contractor or subcontractor shall provide the division:
4388 (i) a signed actuarial certification that the coverage the contractor or subcontractor
4389 offers is qualified health insurance coverage; or
4390 (ii) all relevant documents and information necessary for the division to determine
4391 compliance with this section.
4392 (c) If a contractor or subcontractor provides the documents and information described
4393 in Subsection (7)(b)(ii), the Insurance Department shall assist the division in determining if the
4394 coverage the contractor or subcontractor offers is qualified health insurance coverage.
4395 (8) (a) (i) In addition to the penalties imposed under Subsection (6)(c)(ii), a contractor
4396 or subcontractor that intentionally violates the provisions of this section is liable to the
4397 employee for health care costs that would have been covered by qualified health insurance
4398 coverage.
4399 (ii) An employer has an affirmative defense to a cause of action under Subsection
4400 (8)(a) if:
4401 (A) the employer relied in good faith on a written statement described in Subsection
4402 (5)(a) or (5)(b)(ii); or
4403 (B) the department determines that compliance with this section is not required under
4404 the provisions of Subsection (3).
4405 (b) An employee has a private right of action only against the employee's employer to
4406 enforce the provisions of this Subsection (8).
4407 (9) Any penalties imposed and collected under this section shall be deposited into the
4408 Medicaid Restricted Account created by Section 26-18-402.
4409 (10) The failure of a contractor or subcontractor to provide qualified health insurance
4410 coverage as required by this section:
4411 (a) may not be the basis for a protest or other action from a prospective bidder, offeror,
4412 or contractor under:
4413 (i) Section 63G-6a-1602; or
4414 (ii) any other provision in Title 63G, Chapter 6a, Utah Procurement Code; and
4415 (b) may not be used by the procurement entity or a prospective bidder, offeror, or
4416 contractor as a basis for any action or suit that would suspend, disrupt, or terminate the design
4417 or construction.
4418 Section 49. Section 63C-9-403 is amended to read:
4419 63C-9-403. Contracting power of executive director -- Health insurance coverage.
4420 (1) [
4421 (a) "Aggregate" means the sum of all contracts, change orders, and modifications
4422 related to a single project.
4423 (b) "Change order" means the same as that term is defined in Section 63G-6a-103.
4424 [
4425 "worker," or "operative" [
4426 (i) works at least 30 hours per calendar week; and
4427 (ii) meets employer eligibility waiting requirements for health care insurance, which
4428 may not exceed the first of the calendar month following 60 days [
4429 the day on which the individual is hired.
4430 [
4431 31A-1-301.
4432 [
4433 in Section 26-40-115.
4434 [
4435 [
4436
4437
4438 [
4439
4440 [
4441
4442 [
4443 (2) Except as provided in Subsection (3), the requirements of this section apply to:
4444 (a) a contractor of a design or construction contract entered into by the board, or on
4445 behalf of the board, on or after July 1, 2009, if the prime contract is in an aggregate amount
4446 equal to or greater than $2,000,000; and
4447 (b) a subcontractor of a contractor of a design or construction contract entered into by
4448 the board, or on behalf of the board, on or after July 1, 2009, if the subcontract is in an
4449 aggregate amount equal to or greater than $1,000,000.
4450 (3) The requirements of this section do not apply to a contractor or subcontractor
4451 described in Subsection (2) if:
4452 (a) the application of this section jeopardizes the receipt of federal funds;
4453 (b) the contract is a sole source contract; or
4454 (c) the contract is an emergency procurement.
4455 [
4456
4457
4458 [
4459 modifications, or multiple contracts to circumvent the requirements of [
4460 section is guilty of an infraction.
4461 (5) (a) A contractor subject to [
4462 demonstrate to the executive director that the contractor has and will maintain an offer of
4463 qualified health insurance coverage for the contractor's employees and the employees'
4464 dependents during the duration of the contract[
4465 written statement that:
4466 [
4467
4468 (i) the contractor offers qualified health insurance coverage that complies with Section
4469 26-40-115;
4470 (ii) is from:
4471 (A) an actuary selected by the contractor or the contractor's insurer; or
4472 (B) an underwriter who is responsible for developing the employer group's premium
4473 rates; and
4474 (iii) was created within one year before the day on which the statement is submitted.
4475 (b) A contractor that is subject to the requirements of this section shall:
4476 (i) place a requirement in [
4477 contractor's subcontracts that a subcontractor that is subject to the requirements of this section
4478 shall obtain and maintain an offer of qualified health insurance coverage for the subcontractor's
4479 employees and the employees' dependents during the duration of the subcontract; and
4480 [
4481
4482
4483 (ii) obtain from a subcontractor that is subject to the requirements of this section a
4484 written statement that:
4485 (A) the subcontractor offers qualified health insurance coverage that complies with
4486 Section 26-40-115;
4487 (B) is from an actuary selected by the subcontractor or the subcontractor's insurer, or an
4488 underwriter who is responsible for developing the employer group's premium rates; and
4489 (C) was created within one year before the day on which the contractor obtains the
4490 statement.
4491 (c) (i) (A) A contractor [
4492 offer of qualified health insurance coverage as described in Subsection (5)(a) during the
4493 duration of the contract is subject to penalties in accordance with administrative rules adopted
4494 by the division under Subsection (6).
4495 (B) A contractor is not subject to penalties for the failure of a subcontractor to [
4496
4497 described in Subsection (5)(b)(i).
4498 (ii) (A) A subcontractor [
4499 maintain an offer of qualified health insurance coverage described in Subsection (5)(b)(i)
4500 during the duration of the [
4501 administrative rules adopted by the department under Subsection (6).
4502 (B) A subcontractor is not subject to penalties for the failure of a contractor to [
4503
4504 Subsection (5)(a).
4505 (6) The department shall adopt administrative rules:
4506 (a) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
4507 (b) in coordination with:
4508 (i) the Department of Environmental Quality in accordance with Section 19-1-206;
4509 (ii) the Department of Natural Resources in accordance with Section 79-2-404;
4510 (iii) the State Building Board in accordance with Section [
4511 (iv) a public transit district in accordance with Section 17B-2a-818.5;
4512 (v) the Department of Transportation in accordance with Section 72-6-107.5; and
4513 (vi) the Legislature's Administrative Rules Review Committee; and
4514 (c) that establish:
4515 (i) the requirements and procedures a contractor [
4516 follow to demonstrate [
4517
4518 [
4519
4520 [
4521 (A) that a contractor or subcontractor's compliance with this section is subject to an
4522 audit by the department or the Office of the Legislative Auditor General; [
4523 [
4524
4525
4526
4527
4528
4529 (B) that a contractor that is subject to the requirements of this section shall obtain a
4530 written statement described in Subsection (5)(a); and
4531 (C) that a subcontractor that is subject to the requirements of this section shall obtain a
4532 written statement described in Subsection (5)(b)(ii);
4533 (ii) the penalties that may be imposed if a contractor or subcontractor intentionally
4534 violates the provisions of this section, which may include:
4535 (A) a three-month suspension of the contractor or subcontractor from entering into
4536 future contracts with the state upon the first violation;
4537 (B) a six-month suspension of the contractor or subcontractor from entering into future
4538 contracts with the state upon the second violation;
4539 (C) an action for debarment of the contractor or subcontractor in accordance with
4540 Section 63G-6a-904 upon the third or subsequent violation; and
4541 (D) monetary penalties which may not exceed 50% of the amount necessary to
4542 purchase qualified health insurance coverage for employees and dependents of employees of
4543 the contractor or subcontractor who were not offered qualified health insurance coverage
4544 during the duration of the contract; and
4545 (iii) a website on which the department shall post the commercially equivalent
4546 benchmark, for the qualified health insurance coverage identified in Subsection (1)[
4547 is provided by the Department of Health, in accordance with Subsection 26-40-115(2).
4548 (7) (a) (i) In addition to the penalties imposed under Subsection (6)(c)(ii), a contractor
4549 or subcontractor who intentionally violates the provisions of this section [
4550 the employee for health care costs that would have been covered by qualified health insurance
4551 coverage.
4552 (ii) An employer has an affirmative defense to a cause of action under Subsection
4553 (7)(a)(i) if:
4554 (A) the employer relied in good faith on a written statement [
4555
4556 [
4557 [
4558
4559 (B) the department determines that compliance with this section is not required under
4560 the provisions of Subsection (3) [
4561 (b) An employee has a private right of action only against the employee's employer to
4562 enforce the provisions of this Subsection (7).
4563 (8) Any penalties imposed and collected under this section shall be deposited into the
4564 Medicaid Restricted Account created in Section 26-18-402.
4565 (9) The failure of a contractor or subcontractor to provide qualified health insurance
4566 coverage as required by this section:
4567 (a) may not be the basis for a protest or other action from a prospective bidder, offeror,
4568 or contractor under:
4569 (i) Section 63G-6a-1602; or
4570 (ii) any other provision in Title 63G, Chapter 6a, Utah Procurement Code; and
4571 (b) may not be used by the procurement entity or a prospective bidder, offeror, or
4572 contractor as a basis for any action or suit that would suspend, disrupt, or terminate the design
4573 or construction.
4574 Section 50. Section 63G-2-305 is amended to read:
4575 63G-2-305. Protected records.
4576 The following records are protected if properly classified by a governmental entity:
4577 (1) trade secrets as defined in Section 13-24-2 if the person submitting the trade secret
4578 has provided the governmental entity with the information specified in Section 63G-2-309;
4579 (2) commercial information or nonindividual financial information obtained from a
4580 person if:
4581 (a) disclosure of the information could reasonably be expected to result in unfair
4582 competitive injury to the person submitting the information or would impair the ability of the
4583 governmental entity to obtain necessary information in the future;
4584 (b) the person submitting the information has a greater interest in prohibiting access
4585 than the public in obtaining access; and
4586 (c) the person submitting the information has provided the governmental entity with
4587 the information specified in Section 63G-2-309;
4588 (3) commercial or financial information acquired or prepared by a governmental entity
4589 to the extent that disclosure would lead to financial speculations in currencies, securities, or
4590 commodities that will interfere with a planned transaction by the governmental entity or cause
4591 substantial financial injury to the governmental entity or state economy;
4592 (4) records, the disclosure of which could cause commercial injury to, or confer a
4593 competitive advantage upon a potential or actual competitor of, a commercial project entity as
4594 defined in Subsection 11-13-103(4);
4595 (5) test questions and answers to be used in future license, certification, registration,
4596 employment, or academic examinations;
4597 (6) records, the disclosure of which would impair governmental procurement
4598 proceedings or give an unfair advantage to any person proposing to enter into a contract or
4599 agreement with a governmental entity, except, subject to Subsections (1) and (2), that this
4600 Subsection (6) does not restrict the right of a person to have access to, after the contract or
4601 grant has been awarded and signed by all parties, a bid, proposal, application, or other
4602 information submitted to or by a governmental entity in response to:
4603 (a) an invitation for bids;
4604 (b) a request for proposals;
4605 (c) a request for quotes;
4606 (d) a grant; or
4607 (e) other similar document;
4608 (7) information submitted to or by a governmental entity in response to a request for
4609 information, except, subject to Subsections (1) and (2), that this Subsection (7) does not restrict
4610 the right of a person to have access to the information, after:
4611 (a) a contract directly relating to the subject of the request for information has been
4612 awarded and signed by all parties; or
4613 (b) (i) a final determination is made not to enter into a contract that relates to the
4614 subject of the request for information; and
4615 (ii) at least two years have passed after the day on which the request for information is
4616 issued;
4617 (8) records that would identify real property or the appraisal or estimated value of real
4618 or personal property, including intellectual property, under consideration for public acquisition
4619 before any rights to the property are acquired unless:
4620 (a) public interest in obtaining access to the information is greater than or equal to the
4621 governmental entity's need to acquire the property on the best terms possible;
4622 (b) the information has already been disclosed to persons not employed by or under a
4623 duty of confidentiality to the entity;
4624 (c) in the case of records that would identify property, potential sellers of the described
4625 property have already learned of the governmental entity's plans to acquire the property;
4626 (d) in the case of records that would identify the appraisal or estimated value of
4627 property, the potential sellers have already learned of the governmental entity's estimated value
4628 of the property; or
4629 (e) the property under consideration for public acquisition is a single family residence
4630 and the governmental entity seeking to acquire the property has initiated negotiations to acquire
4631 the property as required under Section 78B-6-505;
4632 (9) records prepared in contemplation of sale, exchange, lease, rental, or other
4633 compensated transaction of real or personal property including intellectual property, which, if
4634 disclosed prior to completion of the transaction, would reveal the appraisal or estimated value
4635 of the subject property, unless:
4636 (a) the public interest in access is greater than or equal to the interests in restricting
4637 access, including the governmental entity's interest in maximizing the financial benefit of the
4638 transaction; or
4639 (b) when prepared by or on behalf of a governmental entity, appraisals or estimates of
4640 the value of the subject property have already been disclosed to persons not employed by or
4641 under a duty of confidentiality to the entity;
4642 (10) records created or maintained for civil, criminal, or administrative enforcement
4643 purposes or audit purposes, or for discipline, licensing, certification, or registration purposes, if
4644 release of the records:
4645 (a) reasonably could be expected to interfere with investigations undertaken for
4646 enforcement, discipline, licensing, certification, or registration purposes;
4647 (b) reasonably could be expected to interfere with audits, disciplinary, or enforcement
4648 proceedings;
4649 (c) would create a danger of depriving a person of a right to a fair trial or impartial
4650 hearing;
4651 (d) reasonably could be expected to disclose the identity of a source who is not
4652 generally known outside of government and, in the case of a record compiled in the course of
4653 an investigation, disclose information furnished by a source not generally known outside of
4654 government if disclosure would compromise the source; or
4655 (e) reasonably could be expected to disclose investigative or audit techniques,
4656 procedures, policies, or orders not generally known outside of government if disclosure would
4657 interfere with enforcement or audit efforts;
4658 (11) records the disclosure of which would jeopardize the life or safety of an
4659 individual;
4660 (12) records the disclosure of which would jeopardize the security of governmental
4661 property, governmental programs, or governmental recordkeeping systems from damage, theft,
4662 or other appropriation or use contrary to law or public policy;
4663 (13) records that, if disclosed, would jeopardize the security or safety of a correctional
4664 facility, or records relating to incarceration, treatment, probation, or parole, that would interfere
4665 with the control and supervision of an offender's incarceration, treatment, probation, or parole;
4666 (14) records that, if disclosed, would reveal recommendations made to the Board of
4667 Pardons and Parole by an employee of or contractor for the Department of Corrections, the
4668 Board of Pardons and Parole, or the Department of Human Services that are based on the
4669 employee's or contractor's supervision, diagnosis, or treatment of any person within the board's
4670 jurisdiction;
4671 (15) records and audit workpapers that identify audit, collection, and operational
4672 procedures and methods used by the State Tax Commission, if disclosure would interfere with
4673 audits or collections;
4674 (16) records of a governmental audit agency relating to an ongoing or planned audit
4675 until the final audit is released;
4676 (17) records that are subject to the attorney client privilege;
4677 (18) records prepared for or by an attorney, consultant, surety, indemnitor, insurer,
4678 employee, or agent of a governmental entity for, or in anticipation of, litigation or a judicial,
4679 quasi-judicial, or administrative proceeding;
4680 (19) (a) (i) personal files of a state legislator, including personal correspondence to or
4681 from a member of the Legislature; and
4682 (ii) notwithstanding Subsection (19)(a)(i), correspondence that gives notice of
4683 legislative action or policy may not be classified as protected under this section; and
4684 (b) (i) an internal communication that is part of the deliberative process in connection
4685 with the preparation of legislation between:
4686 (A) members of a legislative body;
4687 (B) a member of a legislative body and a member of the legislative body's staff; or
4688 (C) members of a legislative body's staff; and
4689 (ii) notwithstanding Subsection (19)(b)(i), a communication that gives notice of
4690 legislative action or policy may not be classified as protected under this section;
4691 (20) (a) records in the custody or control of the Office of Legislative Research and
4692 General Counsel, that, if disclosed, would reveal a particular legislator's contemplated
4693 legislation or contemplated course of action before the legislator has elected to support the
4694 legislation or course of action, or made the legislation or course of action public; and
4695 (b) notwithstanding Subsection (20)(a), the form to request legislation submitted to the
4696 Office of Legislative Research and General Counsel is a public document unless a legislator
4697 asks that the records requesting the legislation be maintained as protected records until such
4698 time as the legislator elects to make the legislation or course of action public;
4699 (21) research requests from legislators to the Office of Legislative Research and
4700 General Counsel or the Office of the Legislative Fiscal Analyst and research findings prepared
4701 in response to these requests;
4702 (22) drafts, unless otherwise classified as public;
4703 (23) records concerning a governmental entity's strategy about:
4704 (a) collective bargaining; or
4705 (b) imminent or pending litigation;
4706 (24) records of investigations of loss occurrences and analyses of loss occurrences that
4707 may be covered by the Risk Management Fund, the Employers' Reinsurance Fund, the
4708 Uninsured Employers' Fund, or similar divisions in other governmental entities;
4709 (25) records, other than personnel evaluations, that contain a personal recommendation
4710 concerning an individual if disclosure would constitute a clearly unwarranted invasion of
4711 personal privacy, or disclosure is not in the public interest;
4712 (26) records that reveal the location of historic, prehistoric, paleontological, or
4713 biological resources that if known would jeopardize the security of those resources or of
4714 valuable historic, scientific, educational, or cultural information;
4715 (27) records of independent state agencies if the disclosure of the records would
4716 conflict with the fiduciary obligations of the agency;
4717 (28) records of an institution within the state system of higher education defined in
4718 Section 53B-1-102 regarding tenure evaluations, appointments, applications for admissions,
4719 retention decisions, and promotions, which could be properly discussed in a meeting closed in
4720 accordance with Title 52, Chapter 4, Open and Public Meetings Act, provided that records of
4721 the final decisions about tenure, appointments, retention, promotions, or those students
4722 admitted, may not be classified as protected under this section;
4723 (29) records of the governor's office, including budget recommendations, legislative
4724 proposals, and policy statements, that if disclosed would reveal the governor's contemplated
4725 policies or contemplated courses of action before the governor has implemented or rejected
4726 those policies or courses of action or made them public;
4727 (30) records of the Office of the Legislative Fiscal Analyst relating to budget analysis,
4728 revenue estimates, and fiscal notes of proposed legislation before issuance of the final
4729 recommendations in these areas;
4730 (31) records provided by the United States or by a government entity outside the state
4731 that are given to the governmental entity with a requirement that they be managed as protected
4732 records if the providing entity certifies that the record would not be subject to public disclosure
4733 if retained by it;
4734 (32) transcripts, minutes, or reports of the closed portion of a meeting of a public body
4735 except as provided in Section 52-4-206;
4736 (33) records that would reveal the contents of settlement negotiations but not including
4737 final settlements or empirical data to the extent that they are not otherwise exempt from
4738 disclosure;
4739 (34) memoranda prepared by staff and used in the decision-making process by an
4740 administrative law judge, a member of the Board of Pardons and Parole, or a member of any
4741 other body charged by law with performing a quasi-judicial function;
4742 (35) records that would reveal negotiations regarding assistance or incentives offered
4743 by or requested from a governmental entity for the purpose of encouraging a person to expand
4744 or locate a business in Utah, but only if disclosure would result in actual economic harm to the
4745 person or place the governmental entity at a competitive disadvantage, but this section may not
4746 be used to restrict access to a record evidencing a final contract;
4747 (36) materials to which access must be limited for purposes of securing or maintaining
4748 the governmental entity's proprietary protection of intellectual property rights including patents,
4749 copyrights, and trade secrets;
4750 (37) the name of a donor or a prospective donor to a governmental entity, including an
4751 institution within the state system of higher education defined in Section 53B-1-102, and other
4752 information concerning the donation that could reasonably be expected to reveal the identity of
4753 the donor, provided that:
4754 (a) the donor requests anonymity in writing;
4755 (b) any terms, conditions, restrictions, or privileges relating to the donation may not be
4756 classified protected by the governmental entity under this Subsection (37); and
4757 (c) except for an institution within the state system of higher education defined in
4758 Section 53B-1-102, the governmental unit to which the donation is made is primarily engaged
4759 in educational, charitable, or artistic endeavors, and has no regulatory or legislative authority
4760 over the donor, a member of the donor's immediate family, or any entity owned or controlled
4761 by the donor or the donor's immediate family;
4762 (38) accident reports, except as provided in Sections 41-6a-404, 41-12a-202, and
4763 73-18-13;
4764 (39) a notification of workers' compensation insurance coverage described in Section
4765 34A-2-205;
4766 (40) (a) the following records of an institution within the state system of higher
4767 education defined in Section 53B-1-102, which have been developed, discovered, disclosed to,
4768 or received by or on behalf of faculty, staff, employees, or students of the institution:
4769 (i) unpublished lecture notes;
4770 (ii) unpublished notes, data, and information:
4771 (A) relating to research; and
4772 (B) of:
4773 (I) the institution within the state system of higher education defined in Section
4774 53B-1-102; or
4775 (II) a sponsor of sponsored research;
4776 (iii) unpublished manuscripts;
4777 (iv) creative works in process;
4778 (v) scholarly correspondence; and
4779 (vi) confidential information contained in research proposals;
4780 (b) Subsection (40)(a) may not be construed to prohibit disclosure of public
4781 information required pursuant to Subsection 53B-16-302(2)(a) or (b); and
4782 (c) Subsection (40)(a) may not be construed to affect the ownership of a record;
4783 (41) (a) records in the custody or control of the Office of Legislative Auditor General
4784 that would reveal the name of a particular legislator who requests a legislative audit prior to the
4785 date that audit is completed and made public; and
4786 (b) notwithstanding Subsection (41)(a), a request for a legislative audit submitted to the
4787 Office of the Legislative Auditor General is a public document unless the legislator asks that
4788 the records in the custody or control of the Office of Legislative Auditor General that would
4789 reveal the name of a particular legislator who requests a legislative audit be maintained as
4790 protected records until the audit is completed and made public;
4791 (42) records that provide detail as to the location of an explosive, including a map or
4792 other document that indicates the location of:
4793 (a) a production facility; or
4794 (b) a magazine;
4795 (43) information:
4796 (a) contained in the statewide database of the Division of Aging and Adult Services
4797 created by Section 62A-3-311.1; or
4798 (b) received or maintained in relation to the Identity Theft Reporting Information
4799 System (IRIS) established under Section 67-5-22;
4800 (44) information contained in the Management Information System and Licensing
4801 Information System described in Title 62A, Chapter 4a, Child and Family Services;
4802 (45) information regarding National Guard operations or activities in support of the
4803 National Guard's federal mission;
4804 (46) records provided by any pawn or secondhand business to a law enforcement
4805 agency or to the central database in compliance with Title 13, Chapter 32a, Pawnshop and
4806 Secondhand Merchandise Transaction Information Act;
4807 (47) information regarding food security, risk, and vulnerability assessments performed
4808 by the Department of Agriculture and Food;
4809 (48) except to the extent that the record is exempt from this chapter pursuant to Section
4810 63G-2-106, records related to an emergency plan or program, a copy of which is provided to or
4811 prepared or maintained by the Division of Emergency Management, and the disclosure of
4812 which would jeopardize:
4813 (a) the safety of the general public; or
4814 (b) the security of:
4815 (i) governmental property;
4816 (ii) governmental programs; or
4817 (iii) the property of a private person who provides the Division of Emergency
4818 Management information;
4819 (49) records of the Department of Agriculture and Food that provides for the
4820 identification, tracing, or control of livestock diseases, including any program established under
4821 Title 4, Chapter 24, Utah Livestock Brand and Anti-Theft Act, or Title 4, Chapter 31, Control
4822 of Animal Disease;
4823 (50) as provided in Section 26-39-501:
4824 (a) information or records held by the Department of Health related to a complaint
4825 regarding a child care program or residential child care which the department is unable to
4826 substantiate; and
4827 (b) information or records related to a complaint received by the Department of Health
4828 from an anonymous complainant regarding a child care program or residential child care;
4829 (51) unless otherwise classified as public under Section 63G-2-301 and except as
4830 provided under Section 41-1a-116, an individual's home address, home telephone number, or
4831 personal mobile phone number, if:
4832 (a) the individual is required to provide the information in order to comply with a law,
4833 ordinance, rule, or order of a government entity; and
4834 (b) the subject of the record has a reasonable expectation that this information will be
4835 kept confidential due to:
4836 (i) the nature of the law, ordinance, rule, or order; and
4837 (ii) the individual complying with the law, ordinance, rule, or order;
4838 (52) the name, home address, work addresses, and telephone numbers of an individual
4839 that is engaged in, or that provides goods or services for, medical or scientific research that is:
4840 (a) conducted within the state system of higher education, as defined in Section
4841 53B-1-102; and
4842 (b) conducted using animals;
4843 (53) an initial proposal under Title 63N, Chapter 13, Part 2, Government Procurement
4844 Private Proposal Program, to the extent not made public by rules made under that chapter;
4845 (54) in accordance with Section 78A-12-203, any record of the Judicial Performance
4846 Evaluation Commission concerning an individual commissioner's vote on whether or not to
4847 recommend that the voters retain a judge including information disclosed under Subsection
4848 78A-12-203(5)(e);
4849 (55) information collected and a report prepared by the Judicial Performance
4850 Evaluation Commission concerning a judge, unless Section 20A-7-702 or Title 78A, Chapter
4851 12, Judicial Performance Evaluation Commission Act, requires disclosure of, or makes public,
4852 the information or report;
4853 (56) records contained in the Management Information System created in Section
4854 62A-4a-1003;
4855 (57) records provided or received by the Public Lands Policy Coordinating Office in
4856 furtherance of any contract or other agreement made in accordance with Section 63J-4-603;
4857 (58) information requested by and provided to the 911 Division under Section
4858 63H-7a-302;
4859 (59) in accordance with Section 73-10-33:
4860 (a) a management plan for a water conveyance facility in the possession of the Division
4861 of Water Resources or the Board of Water Resources; or
4862 (b) an outline of an emergency response plan in possession of the state or a county or
4863 municipality;
4864 (60) the following records in the custody or control of the Office of Inspector General
4865 of Medicaid Services, created in Section 63A-13-201:
4866 (a) records that would disclose information relating to allegations of personal
4867 misconduct, gross mismanagement, or illegal activity of a person if the information or
4868 allegation cannot be corroborated by the Office of Inspector General of Medicaid Services
4869 through other documents or evidence, and the records relating to the allegation are not relied
4870 upon by the Office of Inspector General of Medicaid Services in preparing a final investigation
4871 report or final audit report;
4872 (b) records and audit workpapers to the extent they would disclose the identity of a
4873 person who, during the course of an investigation or audit, communicated the existence of any
4874 Medicaid fraud, waste, or abuse, or a violation or suspected violation of a law, rule, or
4875 regulation adopted under the laws of this state, a political subdivision of the state, or any
4876 recognized entity of the United States, if the information was disclosed on the condition that
4877 the identity of the person be protected;
4878 (c) before the time that an investigation or audit is completed and the final
4879 investigation or final audit report is released, records or drafts circulated to a person who is not
4880 an employee or head of a governmental entity for the person's response or information;
4881 (d) records that would disclose an outline or part of any investigation, audit survey
4882 plan, or audit program; or
4883 (e) requests for an investigation or audit, if disclosure would risk circumvention of an
4884 investigation or audit;
4885 (61) records that reveal methods used by the Office of Inspector General of Medicaid
4886 Services, the fraud unit, or the Department of Health, to discover Medicaid fraud, waste, or
4887 abuse;
4888 (62) information provided to the Department of Health or the Division of Occupational
4889 and Professional Licensing under Subsection 58-68-304(3) or (4);
4890 (63) a record described in Section 63G-12-210;
4891 (64) captured plate data that is obtained through an automatic license plate reader
4892 system used by a governmental entity as authorized in Section 41-6a-2003;
4893 (65) any record in the custody of the Utah Office for Victims of Crime relating to a
4894 victim, including:
4895 (a) a victim's application or request for benefits;
4896 (b) a victim's receipt or denial of benefits; and
4897 (c) any administrative notes or records made or created for the purpose of, or used to,
4898 evaluate or communicate a victim's eligibility for or denial of benefits from the Crime Victim
4899 Reparations Fund;
4900 (66) an audio or video recording created by a body-worn camera, as that term is
4901 defined in Section 77-7a-103, that records sound or images inside a hospital or health care
4902 facility as those terms are defined in Section 78B-3-403, inside a clinic of a health care
4903 provider, as that term is defined in Section 78B-3-403, or inside a human service program as
4904 that term is defined in Subsection 62A-2-101(19)(a)(vi), except for recordings that:
4905 (a) depict the commission of an alleged crime;
4906 (b) record any encounter between a law enforcement officer and a person that results in
4907 death or bodily injury, or includes an instance when an officer fires a weapon;
4908 (c) record any encounter that is the subject of a complaint or a legal proceeding against
4909 a law enforcement officer or law enforcement agency;
4910 (d) contain an officer involved critical incident as defined in Subsection
4911 76-2-408(1)(d); or
4912 (e) have been requested for reclassification as a public record by a subject or
4913 authorized agent of a subject featured in the recording; [
4914 (67) a record pertaining to the search process for a president of an institution of higher
4915 education described in Section 53B-2-102, except for application materials for a publicly
4916 announced finalist[
4917 (68) work papers as defined in Section 31A-2-204.
4918 Section 51. Section 72-6-107.5 is amended to read:
4919 72-6-107.5. Construction of improvements of highway -- Contracts -- Health
4920 insurance coverage.
4921 (1) [
4922 (a) "Aggregate" means the sum of all contracts, change orders, and modifications
4923 related to a single project.
4924 (b) "Change order" means the same as that term is defined in Section 63G-6a-103.
4925 [
4926 "worker," or "operative" [
4927 (i) works at least 30 hours per calendar week; and
4928 (ii) meets employer eligibility waiting requirements for health care insurance, which
4929 may not exceed the first day of the calendar month following 60 days [
4930 after the day on which the individual is hired.
4931 [
4932 31A-1-301.
4933 [
4934 in Section 26-40-115.
4935 [
4936 [
4937
4938
4939 [
4940
4941 [
4942
4943 [
4944 (2) (a) Except as provided in Subsection (3), the requirements of this section apply to:
4945 (a) a contractor of a design or construction contract entered into by the department on
4946 or after July 1, 2009, if the prime contract is in an aggregate amount equal to or greater than
4947 $2,000,000; and
4948 (b) a subcontractor of a contractor of a design or construction contract entered into by
4949 the department on or after July 1, 2009, if the subcontract is in an aggregate amount equal to or
4950 greater than $1,000,000.
4951 (3) The requirements of this section do not apply to a contractor or subcontractor
4952 described in Subsection (2) if:
4953 (a) the application of this section jeopardizes the receipt of federal funds;
4954 (b) the contract is a sole source contract; or
4955 (c) the contract is an emergency procurement.
4956 [
4957
4958
4959 [
4960 modifications, or multiple contracts to circumvent the requirements of [
4961 section is guilty of an infraction.
4962 (5) (a) A contractor subject to [
4963 demonstrate to the department that the contractor has and will maintain an offer of qualified
4964 health insurance coverage for the contractor's employees and the employees' dependents during
4965 the duration of the contract[
4966 [
4967
4968 (i) the contractor offers qualified health insurance coverage that complies with Section
4969 26-40-115;
4970 (ii) is from:
4971 (A) an actuary selected by the contractor or the contractor's insurer; or
4972 (B) an underwriter who is responsible for developing the employer group's premium
4973 rates; and
4974 (iii) was created within one year before the day on which the statement is submitted.
4975 (b) A contractor that is subject to the requirements of this section shall:
4976 (i) place a requirement in [
4977 contractor's subcontracts that a subcontractor that is subject to the requirements of this section
4978 shall obtain and maintain an offer of qualified health insurance coverage for the subcontractor's
4979 employees and the employees' dependents during the duration of the subcontract; and
4980 [
4981
4982
4983 (ii) obtain from a subcontractor that is subject to the requirements of this section a
4984 written statement that:
4985 (A) the subcontractor offers qualified health insurance coverage that complies with
4986 Section 26-40-115;
4987 (B) is from an actuary selected by the subcontractor or the subcontractor's insurer, or an
4988 underwriter who is responsible for developing the employer group's premium rates; and
4989 (C) was created within one year before the day on which the contractor obtains the
4990 statement.
4991 (c) (i) (A) A contractor [
4992 offer of qualified health insurance coverage described in Subsection (5)(a) during the duration
4993 of the contract is subject to penalties in accordance with administrative rules adopted by the
4994 department under Subsection (6).
4995 (B) A contractor is not subject to penalties for the failure of a subcontractor to [
4996
4997 described in Subsection (5)(b)(i).
4998 (ii) (A) A subcontractor [
4999 maintain an offer of qualified health insurance coverage described in Subsection (5)(b) during
5000 the duration of the [
5001 administrative rules adopted by the department under Subsection (6).
5002 (B) A subcontractor is not subject to penalties for the failure of a contractor to [
5003
5004 Subsection (5)(a).
5005 (6) The department shall adopt administrative rules:
5006 (a) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
5007 (b) in coordination with:
5008 (i) the Department of Environmental Quality in accordance with Section 19-1-206;
5009 (ii) the Department of Natural Resources in accordance with Section 79-2-404;
5010 (iii) the State Building Board in accordance with Section [
5011 (iv) the State Capitol Preservation Board in accordance with Section 63C-9-403;
5012 (v) a public transit district in accordance with Section 17B-2a-818.5; and
5013 (vi) the Legislature's Administrative Rules Review Committee; and
5014 (c) that establish:
5015 (i) the requirements and procedures a contractor [
5016 follow to demonstrate [
5017 including:
5018 [
5019
5020 [
5021 (A) that a contractor or subcontractor's compliance with this section is subject to an
5022 audit by the department or the Office of the Legislative Auditor General; [
5023 [
5024
5025
5026
5027
5028
5029 (B) that a contractor that is subject to the requirements of this section shall obtain a
5030 written statement described in Subsection (5)(a); and
5031 (C) that a subcontractor that is subject to the requirements of this section shall obtain a
5032 written statement described in Subsection (5)(b)(ii);
5033 (ii) the penalties that may be imposed if a contractor or subcontractor intentionally
5034 violates the provisions of this section, which may include:
5035 (A) a three-month suspension of the contractor or subcontractor from entering into
5036 future contracts with the state upon the first violation;
5037 (B) a six-month suspension of the contractor or subcontractor from entering into future
5038 contracts with the state upon the second violation;
5039 (C) an action for debarment of the contractor or subcontractor in accordance with
5040 Section 63G-6a-904 upon the third or subsequent violation; and
5041 (D) monetary penalties which may not exceed 50% of the amount necessary to
5042 purchase qualified health insurance coverage for an employee and a dependent of the employee
5043 of the contractor or subcontractor who was not offered qualified health insurance coverage
5044 during the duration of the contract; and
5045 (iii) a website on which the department shall post the commercially equivalent
5046 benchmark, for the qualified health insurance coverage identified in Subsection (1)[
5047 is provided by the Department of Health, in accordance with Subsection 26-40-115(2).
5048 (7) (a) (i) In addition to the penalties imposed under Subsection (6)(c)(ii), a contractor
5049 or subcontractor who intentionally violates the provisions of this section [
5050 the employee for health care costs that would have been covered by qualified health insurance
5051 coverage.
5052 (ii) An employer has an affirmative defense to a cause of action under Subsection
5053 (7)(a)(i) if:
5054 (A) the employer relied in good faith on a written statement [
5055
5056 [
5057 [
5058
5059 (B) the department determines that compliance with this section is not required under
5060 the provisions of Subsection (3) [
5061 (b) An employee has a private right of action only against the employee's employer to
5062 enforce the provisions of this Subsection (7).
5063 (8) Any penalties imposed and collected under this section shall be deposited into the
5064 Medicaid Restricted Account created in Section 26-18-402.
5065 (9) The failure of a contractor or subcontractor to provide qualified health insurance
5066 coverage as required by this section:
5067 (a) may not be the basis for a protest or other action from a prospective bidder, offeror,
5068 or contractor under:
5069 (i) Section 63G-6a-1602; or
5070 (ii) any other provision in Title 63G, Chapter 6a, Utah Procurement Code; and
5071 (b) may not be used by the procurement entity or a prospective bidder, offeror, or
5072 contractor as a basis for any action or suit that would suspend, disrupt, or terminate the design
5073 or construction.
5074 Section 52. Section 79-2-404 is amended to read:
5075 79-2-404. Contracting powers of department -- Health insurance coverage.
5076 (1) [
5077 (a) "Aggregate" means the sum of all contracts, change orders, and modifications
5078 related to a single project.
5079 (b) "Change order" means the same as that term is defined in Section 63G-6a-103.
5080 [
5081 "worker," or "operative" [
5082 (i) works at least 30 hours per calendar week; and
5083 (ii) meets employer eligibility waiting requirements for health care insurance, which
5084 may not exceed the first day of the calendar month following 60 days [
5085 after the day on which the individual is hired.
5086 [
5087 31A-1-301.
5088 [
5089 in Section 26-40-115.
5090 [
5091 [
5092
5093
5094
5095 [
5096
5097 [
5098
5099 (2) Except as provided in Subsection (3), the requirements of this section apply to:
5100 (a) a contractor of a design or construction contract entered into by, or delegated to, the
5101 department or a division, board, or council of the department on or after July 1, 2009, if the
5102 prime contract is in an aggregate amount equal to or greater than $2,000,000; and
5103 (b) a subcontractor of a contractor of a design or construction contract entered into by,
5104 or delegated to, the department or a division, board, or council of the department on or after
5105 July 1, 2009, if the subcontract is in an aggregate amount equal to or greater than $1,000,000.
5106 (3) This section does not apply to contracts entered into by the department or a
5107 division, board, or council of the department if:
5108 (a) the application of this section jeopardizes the receipt of federal funds;
5109 (b) the contract or agreement is between:
5110 (i) the department or a division, board, or council of the department; and
5111 (ii) (A) another agency of the state;
5112 (B) the federal government;
5113 (C) another state;
5114 (D) an interstate agency;
5115 (E) a political subdivision of this state; or
5116 (F) a political subdivision of another state; or
5117 (c) the contract or agreement is:
5118 (i) for the purpose of disbursing grants or loans authorized by statute;
5119 (ii) a sole source contract; or
5120 (iii) an emergency procurement.
5121 [
5122
5123
5124 [
5125 modifications, or multiple contracts to circumvent the requirements of [
5126 section is guilty of an infraction.
5127 (5) (a) A contractor subject to [
5128 shall demonstrate to the department that the contractor has and will maintain an offer of
5129 qualified health insurance coverage for the contractor's employees and the employees'
5130 dependents during the duration of the contract[
5131 statement that:
5132 [
5133
5134 (i) the contractor offers qualified health insurance coverage that complies with Section
5135 26-40-115;
5136 (ii) is from:
5137 (A) an actuary selected by the contractor or the contractor's insurer; or
5138 (B) an underwriter who is responsible for developing the employer group's premium
5139 rates; and
5140 (iii) was created within one year before the day on which the statement is submitted.
5141 (b) A contractor that is subject to the requirements of this section shall:
5142 (i) place a requirement in [
5143 contractor's subcontracts that a subcontractor that is subject to the requirements of this section
5144 shall obtain and maintain an offer of qualified health insurance coverage for the subcontractor's
5145 employees and the employees' [
5146 and
5147 [
5148
5149
5150 (ii) obtain from a subcontractor that is subject to the requirements of this section a
5151 written statement that:
5152 (A) the subcontractor offers qualified health insurance coverage that complies with
5153 Section 26-40-115;
5154 (B) is from an actuary selected by the subcontractor or the subcontractor's insurer, or an
5155 underwriter who is responsible for developing the employer group's premium rates; and
5156 (C) was created within one year before the day on which the contractor obtains the
5157 statement.
5158 (c) (i) (A) A contractor [
5159 offer of qualified health insurance coverage described in Subsection (5)(a) during the duration
5160 of the contract is subject to penalties in accordance with administrative rules adopted by the
5161 department under Subsection (6).
5162 (B) A contractor is not subject to penalties for the failure of a subcontractor to [
5163
5164 described in Subsection (5)(b)(i).
5165 (ii) (A) A subcontractor [
5166 maintain an offer of qualified health insurance coverage described in Subsection (5)(b) during
5167 the duration of the [
5168 administrative rules adopted by the department under Subsection (6).
5169 (B) A subcontractor is not subject to penalties for the failure of a contractor to [
5170
5171 Subsection (5)(a).
5172 (6) The department shall adopt administrative rules:
5173 (a) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
5174 (b) in coordination with:
5175 (i) the Department of Environmental Quality in accordance with Section 19-1-206;
5176 (ii) a public transit district in accordance with Section 17B-2a-818.5;
5177 (iii) the State Building Board in accordance with Section [
5178 (iv) the State Capitol Preservation Board in accordance with Section 63C-9-403;
5179 (v) the Department of Transportation in accordance with Section 72-6-107.5; and
5180 (vi) the Legislature's Administrative Rules Review Committee; and
5181 (c) that establish:
5182 (i) the requirements and procedures a contractor [
5183 follow to demonstrate compliance with this section [
5184 including:
5185 [
5186
5187 [
5188 (A) that a contractor or subcontractor's compliance with this section is subject to an
5189 audit by the department or the Office of the Legislative Auditor General; [
5190 [
5191
5192
5193
5194
5195
5196 (B) that a contractor that is subject to the requirements of this section shall obtain a
5197 written statement described in Subsection (5)(a); and
5198 (C) that a subcontractor that is subject to the requirements of this section shall obtain a
5199 written statement described in Subsection (5)(b)(ii);
5200 (ii) the penalties that may be imposed if a contractor or subcontractor intentionally
5201 violates the provisions of this section, which may include:
5202 (A) a three-month suspension of the contractor or subcontractor from entering into
5203 future contracts with the state upon the first violation;
5204 (B) a six-month suspension of the contractor or subcontractor from entering into future
5205 contracts with the state upon the second violation;
5206 (C) an action for debarment of the contractor or subcontractor in accordance with
5207 Section 63G-6a-904 upon the third or subsequent violation; and
5208 (D) monetary penalties which may not exceed 50% of the amount necessary to
5209 purchase qualified health insurance coverage for an employee and a dependent of an employee
5210 of the contractor or subcontractor who was not offered qualified health insurance coverage
5211 during the duration of the contract; and
5212 (iii) a website on which the department shall post the commercially equivalent
5213 benchmark, for the qualified health insurance coverage identified in Subsection (1)[
5214 provided by the Department of Health, in accordance with Subsection 26-40-115(2).
5215 (7) (a) (i) In addition to the penalties imposed under Subsection (6)(c)(ii), a contractor
5216 or subcontractor who intentionally violates the provisions of this section [
5217 the employee for health care costs that would have been covered by qualified health insurance
5218 coverage.
5219 (ii) An employer has an affirmative defense to a cause of action under Subsection
5220 (7)(a)(i) if:
5221 (A) the employer relied in good faith on a written statement [
5222
5223 [
5224 [
5225
5226 (B) the department determines that compliance with this section is not required under
5227 the provisions of Subsection (3) [
5228 (b) An employee has a private right of action only against the employee's employer to
5229 enforce the provisions of this Subsection (7).
5230 (8) Any penalties imposed and collected under this section shall be deposited into the
5231 Medicaid Restricted Account created in Section 26-18-402.
5232 (9) The failure of a contractor or subcontractor to provide qualified health insurance
5233 coverage as required by this section:
5234 (a) may not be the basis for a protest or other action from a prospective bidder, offeror,
5235 or contractor under:
5236 (i) Section 63G-6a-1602; or
5237 (ii) any other provision in Title 63G, Chapter 6a, Utah Procurement Code; and
5238 (b) may not be used by the procurement entity or a prospective bidder, offeror, or
5239 contractor as a basis for any action or suit that would suspend, disrupt, or terminate the design
5240 or construction.
5241 Section 53. Repealer.
5242 This bill repeals:
5243 Section 31A-22-722.5, Mini-COBRA election -- American Recovery and
5244 Reinvestment Act.
5245 Section 31A-30-209, Insurance producers and the Health Insurance Exchange.