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