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7 LONG TITLE
8 Committee Note:
9 The Business and Labor Interim Committee recommended this bill.
10 General Description:
11 This bill modifies provisions related to insurance.
12 Highlighted Provisions:
13 This bill:
14 ▸ defines terms;
15 ▸ provides that the Title and Escrow Commission shall meet at least quarterly, rather
16 than monthly;
17 ▸ enacts provisions that require a group-wide supervisor for each internationally
18 active insurance group;
19 ▸ enacts the Corporate Governance Annual Disclosure Act, which:
20 • requires each insurer or insurance group to submit a disclosure document to the
21 Insurance Commissioner that describes the entity's corporate governance
22 structure, policies, and practices;
23 • provides that a corporate governance annual disclosure and certain related
24 records are confidential and classified as protected for purposes of the
25 Government Records Access and Management Act;
26 • allows the insurance commissioner to hire one or more third-party consultants to
27 review a corporate governance annual disclosure; and
28 • provides a penalty for an insurer or insurance group that fails to timely submit a
29 corporate governance annual disclosure;
30 ▸ modifies the eligibility requirements for the small company exemption from the
31 generally applicable requirements for reserves;
32 ▸ provides that an endorsement to a policy must include the insurer's name and state
33 of domicile;
34 ▸ provides a deadline by which an insurer issuing certain types of policies must
35 deliver a policy to the policyholder or a certificate to each member of the insured
36 group;
37 ▸ allows for an action against an insurer after a denial of payment;
38 ▸ provides certain conditions and disclosure requirements for a short-term limited
39 duration policy insurance policy that includes a preexisting condition exclusion;
40 ▸ clarifies that an employee may, under certain circumstances, extend coverage under
41 an employer's group policy;
42 ▸ provides that the commissioner may take action against a navigator licensee or
43 applicant, a third-party administrator licensee or applicant, or an insurance adjuster
44 licensee or applicant, who:
45 • is convicted of a misdemeanor involving fraud, misrepresentation, theft, or
46 dishonesty; or
47 • has had a professional or occupational license or registration denied, suspended,
48 revoked, or surrendered to resolve an administrative action;
49 ▸ enacts provisions related to an indemnitor's duty to indemnify an insolvent insurer;
50 ▸ modifies the conduct that constitutes a fraudulent insurance act under the Insurance
51 Code and the Utah Criminal Code;
52 ▸ clarifies that the Insurance Department may investigate and enforce certain
53 provisions of the Workers' Compensation Act;
54 ▸ clarifies the process by which the Insurance Commissioner reviews and acts upon
55 an application for a bail bond agency license;
56 ▸ consolidates certain provisions governing captive insurance companies;
57 ▸ establishes a certificate of dormancy for eligible captive insurance companies;
58 ▸ requires a new or renamed captive insurance company to include the word
59 "insurance" or an equivalent term in its name;
60 ▸ requires two individuals to verify a captive insurance company's report of financial
61 condition;
62 ▸ requires a captive insurance company to report certain changes to its financial
63 condition to the Insurance Commissioner; and
64 ▸ makes technical and conforming changes.
65 Money Appropriated in this Bill:
66 None
67 Other Special Clauses:
68 This bill provides a special effective date.
69 Utah Code Sections Affected:
70 AMENDS:
71 31A-1-301, as last amended by Laws of Utah 2018, Chapter 319
72 31A-2-403, as last amended by Laws of Utah 2018, Chapter 319
73 31A-16-109, as last amended by Laws of Utah 2016, Chapter 163
74 31A-17-519, as enacted by Laws of Utah 2016, Chapter 163
75 31A-21-201, as last amended by Laws of Utah 2010, Chapter 10
76 31A-21-311, as last amended by Laws of Utah 2003, Chapter 252
77 31A-21-313, as last amended by Laws of Utah 2015, Chapter 244
78 31A-22-501, as last amended by Laws of Utah 2005, Chapter 125
79 31A-22-605.1, as enacted by Laws of Utah 2005, Chapter 78
80 31A-22-611, as last amended by Laws of Utah 2011, Chapters 297 and 366
81 31A-22-627, as last amended by Laws of Utah 2017, Chapter 292
82 31A-22-638, as enacted by Laws of Utah 2010, Chapter 360
83 31A-22-701, as last amended by Laws of Utah 2018, Chapter 319
84 31A-22-722, as last amended by Laws of Utah 2018, Chapter 319
85 31A-22-726, as last amended by Laws of Utah 2015, Chapter 283
86 31A-23a-111, as last amended by Laws of Utah 2018, Chapter 319
87 31A-23a-402, as last amended by Laws of Utah 2017, Chapter 292
88 31A-23a-411.1, as enacted by Laws of Utah 2003, Chapter 252
89 31A-23a-415, as last amended by Laws of Utah 2015, Chapters 312 and 330
90 31A-23b-401, as last amended by Laws of Utah 2017, Chapter 168
91 31A-25-208, as last amended by Laws of Utah 2016, Chapter 138
92 31A-26-213, as last amended by Laws of Utah 2017, Chapter 168
93 31A-30-103, as last amended by Laws of Utah 2014, Chapters 290, 300, and 425
94 31A-30-118, as enacted by Laws of Utah 2014, Chapter 425
95 31A-31-103, as last amended by Laws of Utah 2004, Chapter 104
96 31A-31-107, as last amended by Laws of Utah 1997, Chapter 375
97 31A-35-405, as last amended by Laws of Utah 2016, Chapter 234
98 31A-37-102, as last amended by Laws of Utah 2017, Chapter 168
99 31A-37-103, as last amended by Laws of Utah 2016, Chapter 138
100 31A-37-106, as last amended by Laws of Utah 2017, Chapter 168
101 31A-37-201, as enacted by Laws of Utah 2003, Chapter 251
102 31A-37-203, as enacted by Laws of Utah 2003, Chapter 251
103 31A-37-301, as last amended by Laws of Utah 2017, Chapter 168
104 31A-37-401, as last amended by Laws of Utah 2015, Chapter 244
105 31A-37-501, as last amended by Laws of Utah 2016, Chapter 138
106 31A-37-502, as last amended by Laws of Utah 2016, Chapters 138 and 348
107 31A-45-102, as enacted by Laws of Utah 2017, Chapter 292
108 31A-45-303, as last amended by Laws of Utah 2017, Chapter 168 and renumbered and
109 amended by Laws of Utah 2017, Chapter 292
110 31A-45-401, as renumbered and amended by Laws of Utah 2017, Chapter 292
111 34A-2-110, as last amended by Laws of Utah 2011, Chapters 328 and 413
112 63G-2-305, as last amended by Laws of Utah 2018, Chapters 81, 159, 285, 315, 316,
113 319, 352, 409, and 425
114 76-6-521, as last amended by Laws of Utah 2004, Chapter 104
115 ENACTS:
116 31A-16-108.6, Utah Code Annotated 1953
117 31A-16b-101, Utah Code Annotated 1953
118 31A-16b-102, Utah Code Annotated 1953
119 31A-16b-103, Utah Code Annotated 1953
120 31A-16b-104, Utah Code Annotated 1953
121 31A-16b-105, Utah Code Annotated 1953
122 31A-16b-106, Utah Code Annotated 1953
123 31A-16b-107, Utah Code Annotated 1953
124 31A-16b-108, Utah Code Annotated 1953
125 31A-27a-512.1, Utah Code Annotated 1953
126 31A-37-701, Utah Code Annotated 1953
127 31A-37-702, Utah Code Annotated 1953
128 REPEALS AND REENACTS:
129 31A-37-202, as last amended by Laws of Utah 2017, Chapter 168
130 REPEALS:
131 31A-16a-102, as enacted by Laws of Utah 2017, Chapter 168
132
133 Be it enacted by the Legislature of the state of Utah:
134 Section 1. Section 31A-1-301 is amended to read:
135 31A-1-301. Definitions.
136 As used in this title, unless otherwise specified:
137 (1) (a) "Accident and health insurance" means insurance to provide protection against
138 economic losses resulting from:
139 (i) a medical condition including:
140 (A) a medical care expense; or
141 (B) the risk of disability;
142 (ii) accident; or
143 (iii) sickness.
144 (b) "Accident and health insurance":
145 (i) includes a contract with disability contingencies including:
146 (A) an income replacement contract;
147 (B) a health care contract;
148 (C) an expense reimbursement contract;
149 (D) a credit accident and health contract;
150 (E) a continuing care contract; and
151 (F) a long-term care contract; and
152 (ii) may provide:
153 (A) hospital coverage;
154 (B) surgical coverage;
155 (C) medical coverage;
156 (D) loss of income coverage;
157 (E) prescription drug coverage;
158 (F) dental coverage; or
159 (G) vision coverage.
160 (c) "Accident and health insurance" does not include workers' compensation insurance.
161 (d) For purposes of a national licensing registry, "accident and health insurance" is the
162 same as "accident and health or sickness insurance."
163 (2) "Actuary" is as defined by the commissioner by rule, made in accordance with Title
164 63G, Chapter 3, Utah Administrative Rulemaking Act.
165 (3) "Administrator" means the same as that term is defined in Subsection [
166 (4) "Adult" means an individual who has attained the age of at least 18 years.
167 (5) "Affiliate" means a person who controls, is controlled by, or is under common
168 control with, another person. A corporation is an affiliate of another corporation, regardless of
169 ownership, if substantially the same group of individuals manage the corporations.
170 (6) "Agency" means:
171 (a) a person other than an individual, including a sole proprietorship by which an
172 individual does business under an assumed name; and
173 (b) an insurance organization licensed or required to be licensed under Section
174 31A-23a-301, 31A-25-207, or 31A-26-209.
175 (7) "Alien insurer" means an insurer domiciled outside the United States.
176 (8) "Amendment" means an endorsement to an insurance policy or certificate.
177 (9) "Annuity" means an agreement to make periodical payments for a period certain or
178 over the lifetime of one or more individuals if the making or continuance of all or some of the
179 series of the payments, or the amount of the payment, is dependent upon the continuance of
180 human life.
181 (10) "Application" means a document:
182 (a) (i) completed by an applicant to provide information about the risk to be insured;
183 and
184 (ii) that contains information that is used by the insurer to evaluate risk and decide
185 whether to:
186 (A) insure the risk under:
187 (I) the coverage as originally offered; or
188 (II) a modification of the coverage as originally offered; or
189 (B) decline to insure the risk; or
190 (b) used by the insurer to gather information from the applicant before issuance of an
191 annuity contract.
192 (11) "Articles" or "articles of incorporation" means:
193 (a) the original articles;
194 (b) a special law;
195 (c) a charter;
196 (d) an amendment;
197 (e) restated articles;
198 (f) articles of merger or consolidation;
199 (g) a trust instrument;
200 (h) another constitutive document for a trust or other entity that is not a corporation;
201 and
202 (i) an amendment to an item listed in Subsections (11)(a) through (h).
203 (12) "Bail bond insurance" means a guarantee that a person will attend court when
204 required, up to and including surrender of the person in execution of a sentence imposed under
205 Subsection 77-20-7(1), as a condition to the release of that person from confinement.
206 (13) "Binder" means the same as that term is defined in Section 31A-21-102.
207 (14) "Blanket insurance policy" means a group policy covering a defined class of
208 persons:
209 (a) without individual underwriting or application; and
210 (b) that is determined by definition without designating each person covered.
211 (15) "Board," "board of trustees," or "board of directors" means the group of persons
212 with responsibility over, or management of, a corporation, however designated.
213 (16) "Bona fide office" means a physical office in this state:
214 (a) that is open to the public;
215 (b) that is staffed during regular business hours on regular business days; and
216 (c) at which the public may appear in person to obtain services.
217 (17) "Business entity" means:
218 (a) a corporation;
219 (b) an association;
220 (c) a partnership;
221 (d) a limited liability company;
222 (e) a limited liability partnership; or
223 (f) another legal entity.
224 (18) "Business of insurance" means the same as that term is defined in Subsection
225 [
226 (19) "Business plan" means the information required to be supplied to the
227 commissioner under Subsections 31A-5-204(2)(i) and (j), including the information required
228 when these subsections apply by reference under:
229 (a) Section 31A-7-201;
230 (b) Section 31A-8-205; or
231 (c) Subsection 31A-9-205(2).
232 (20) (a) "Bylaws" means the rules adopted for the regulation or management of a
233 corporation's affairs, however designated.
234 (b) "Bylaws" includes comparable rules for a trust or other entity that is not a
235 corporation.
236 (21) "Captive insurance company" means:
237 (a) an insurer:
238 (i) owned by another organization; and
239 (ii) whose exclusive purpose is to insure risks of the parent organization and an
240 affiliated company; or
241 (b) in the case of a group or association, an insurer:
242 (i) owned by the insureds; and
243 (ii) whose exclusive purpose is to insure risks of:
244 (A) a member organization;
245 (B) a group member; or
246 (C) an affiliate of:
247 (I) a member organization; or
248 (II) a group member.
249 (22) "Casualty insurance" means liability insurance.
250 (23) "Certificate" means evidence of insurance given to:
251 (a) an insured under a group insurance policy; or
252 (b) a third party.
253 (24) "Certificate of authority" is included within the term "license."
254 (25) "Claim," unless the context otherwise requires, means a request or demand on an
255 insurer for payment of a benefit according to the terms of an insurance policy.
256 (26) "Claims-made coverage" means an insurance contract or provision limiting
257 coverage under a policy insuring against legal liability to claims that are first made against the
258 insured while the policy is in force.
259 (27) (a) "Commissioner" or "commissioner of insurance" means Utah's insurance
260 commissioner.
261 (b) When appropriate, the terms listed in Subsection (27)(a) apply to the equivalent
262 supervisory official of another jurisdiction.
263 (28) (a) "Continuing care insurance" means insurance that:
264 (i) provides board and lodging;
265 (ii) provides one or more of the following:
266 (A) a personal service;
267 (B) a nursing service;
268 (C) a medical service; or
269 (D) any other health-related service; and
270 (iii) provides the coverage described in this Subsection (28)(a) under an agreement
271 effective:
272 (A) for the life of the insured; or
273 (B) for a period in excess of one year.
274 (b) Insurance is continuing care insurance regardless of whether or not the board and
275 lodging are provided at the same location as a service described in Subsection (28)(a)(ii).
276 (29) (a) "Control," "controlling," "controlled," or "under common control" means the
277 direct or indirect possession of the power to direct or cause the direction of the management
278 and policies of a person. This control may be:
279 (i) by contract;
280 (ii) by common management;
281 (iii) through the ownership of voting securities; or
282 (iv) by a means other than those described in Subsections (29)(a)(i) through (iii).
283 (b) There is no presumption that an individual holding an official position with another
284 person controls that person solely by reason of the position.
285 (c) A person having a contract or arrangement giving control is considered to have
286 control despite the illegality or invalidity of the contract or arrangement.
287 (d) There is a rebuttable presumption of control in a person who directly or indirectly
288 owns, controls, holds with the power to vote, or holds proxies to vote 10% or more of the
289 voting securities of another person.
290 (30) "Controlled insurer" means a licensed insurer that is either directly or indirectly
291 controlled by a producer.
292 (31) "Controlling person" means a person that directly or indirectly has the power to
293 direct or cause to be directed, the management, control, or activities of a reinsurance
294 intermediary.
295 (32) "Controlling producer" means a producer who directly or indirectly controls an
296 insurer.
297 (33) "Corporate governance annual disclosure" means a report an insurer or insurance
298 group files in accordance with the requirements of Chapter 16b, Corporate Governance Annual
299 Disclosure Act.
300 [
301 (i) a corporation doing business:
302 (A) as:
303 (I) an insurance producer;
304 (II) a surplus lines producer;
305 (III) a limited line producer;
306 (IV) a consultant;
307 (V) a managing general agent;
308 (VI) a reinsurance intermediary;
309 (VII) a third party administrator; or
310 (VIII) an adjuster; and
311 (B) under:
312 (I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
313 Reinsurance Intermediaries;
314 (II) Chapter 25, Third Party Administrators; or
315 (III) Chapter 26, Insurance Adjusters; or
316 (ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance
317 Holding Companies.
318 (b) "Mutual" or "mutual corporation" means a mutual insurance corporation.
319 (c) "Stock corporation" means a stock insurance corporation.
320 [
321 regulations adopted pursuant to the Health Insurance Portability and Accountability Act.
322 (b) "Creditable coverage" includes coverage that is offered through a public health plan
323 such as:
324 (i) the Primary Care Network Program under a Medicaid primary care network
325 demonstration waiver obtained subject to Section 26-18-3;
326 (ii) the Children's Health Insurance Program under Section 26-40-106; or
327 (iii) the Ryan White Program Comprehensive AIDS Resources Emergency Act, Pub. L.
328 No. 101-381, and Ryan White HIV/AIDS Treatment Modernization Act of 2006, Pub. L. No.
329 109-415.
330 [
331 provide indemnity for payments coming due on a specific loan or other credit transaction while
332 the debtor has a disability.
333 [
334 extension of credit that is limited to partially or wholly extinguishing that credit obligation.
335 (b) "Credit insurance" includes:
336 (i) credit accident and health insurance;
337 (ii) credit life insurance;
338 (iii) credit property insurance;
339 (iv) credit unemployment insurance;
340 (v) guaranteed automobile protection insurance;
341 (vi) involuntary unemployment insurance;
342 (vii) mortgage accident and health insurance;
343 (viii) mortgage guaranty insurance; and
344 (ix) mortgage life insurance.
345 [
346 with an extension of credit that pays a person if the debtor dies.
347 [
348 (a) matured;
349 (b) unmatured;
350 (c) liquidated;
351 (d) unliquidated;
352 (e) secured;
353 (f) unsecured;
354 (g) absolute;
355 (h) fixed; or
356 (i) contingent.
357 [
358 (a) offered in connection with an extension of credit; and
359 (b) that protects the property until the debt is paid.
360 [
361 (a) offered in connection with an extension of credit; and
362 (b) that provides indemnity if the debtor is unemployed for payments coming due on a:
363 (i) specific loan; or
364 (ii) credit transaction.
365 [
366 to crops from unfavorable weather conditions, fire or lightning, flood, hail, insect infestation,
367 disease, or other yield-reducing conditions or perils that is:
368 (i) provided by the private insurance market; or
369 (ii) subsidized by the Federal Crop Insurance Corporation.
370 (b) "Crop insurance" includes multiperil crop insurance.
371 [
372 insurance service and insurance product information:
373 (i) for the customer service representative's:
374 (A) producer;
375 (B) surplus lines producer; or
376 (C) consultant employer; and
377 (ii) to the customer service representative's employer's:
378 (A) customer;
379 (B) client; or
380 (C) organization.
381 (b) A customer service representative may only operate within the scope of authority of
382 the customer service representative's producer, surplus lines producer, or consultant employer.
383 [
384 (a) imposed by:
385 (i) statute;
386 (ii) rule; or
387 (iii) order; and
388 (b) by which a required filing or payment must be received by the department.
389 [
390 occurrence of a condition precedent, the commissioner is considered to have taken a specific
391 action. If the statute so provides, a condition precedent may be the commissioner's failure to
392 take a specific action.
393 [
394 determined by counting the generations separating one person from a common ancestor and
395 then counting the generations to the other person.
396 [
397 [
398 [
399 or totally limits an individual's ability to:
400 (a) perform the duties of:
401 (i) that individual's occupation; or
402 (ii) an occupation for which the individual is reasonably suited by education, training,
403 or experience; or
404 (b) perform two or more of the following basic activities of daily living:
405 (i) eating;
406 (ii) toileting;
407 (iii) transferring;
408 (iv) bathing; or
409 (v) dressing.
410 [
411 Subsection [
412 [
413 [
414 (a) is incorporated;
415 (b) is organized; or
416 (c) in the case of an alien insurer, enters into the United States.
417 [
418 (i) an employee who:
419 (A) works on a full-time basis; and
420 (B) has a normal work week of 30 or more hours; or
421 (ii) a person described in Subsection [
422 (b) "Eligible employee" includes:
423 (i) an owner who:
424 (A) works on a full-time basis; and
425 (B) has a normal work week of 30 or more hours; and
426 (ii) if the individual is included under a health benefit plan of a small employer:
427 (A) a sole proprietor;
428 (B) a partner in a partnership; or
429 (C) an independent contractor.
430 (c) "Eligible employee" does not include, unless eligible under Subsection [
431 (53)(b):
432 (i) an individual who works on a temporary or substitute basis for a small employer;
433 (ii) an employer's spouse who does not meet the requirements of Subsection [
434 (53)(a)(i); or
435 (iii) a dependent of an employer who does not meet the requirements of Subsection
436 [
437 [
438 (a) an individual employed by an employer; and
439 (b) an owner who meets the requirements of Subsection [
440 [
441 (a) an employee; or
442 (b) a dependent of an employee.
443 [
444 (i) established or maintained, whether directly or through a trustee, by:
445 (A) one or more employers;
446 (B) one or more labor organizations; or
447 (C) a combination of employers and labor organizations; and
448 (ii) that provides employee benefits paid or contracted to be paid, other than income
449 from investments of the fund:
450 (A) by or on behalf of an employer doing business in this state; or
451 (B) for the benefit of a person employed in this state.
452 (b) "Employee welfare fund" includes a plan funded or subsidized by a user fee or tax
453 revenues.
454 [
455 to modify the policy or certificate coverage.
456 [
457 (i) a policyholder;
458 (ii) a certificate holder;
459 (iii) a subscriber; or
460 (iv) a covered individual:
461 (A) who has entered into a contract with an organization for health care; or
462 (B) on whose behalf an arrangement for health care has been made.
463 (b) "Enrollee" includes an insured.
464 [
465 (a) the first day of coverage; or
466 (b) if there is a waiting period, the first day of the waiting period.
467 [
468 involving one or more affiliates of an insurer that, if not remedied promptly, is likely to have a
469 material adverse effect upon the financial condition or liquidity of the insurer or its insurance
470 holding company system as a whole, including anything that would cause:
471 (a) the insurer's risk-based capital to fall into an action or control level as set forth in
472 Sections 31A-17-601 through 31A-17-613; or
473 (b) the insurer to be in hazardous financial condition set forth in Section 31A-27a-101.
474 [
475 (i) a transaction that effects the sale, transfer, encumbering, or leasing of real property,
476 when a person not a party to the transaction, and neither having nor acquiring an interest in the
477 title, performs, in accordance with the written instructions or terms of the written agreement
478 between the parties to the transaction, any of the following actions:
479 (A) the explanation, holding, or creation of a document; or
480 (B) the receipt, deposit, and disbursement of money;
481 (ii) a settlement or closing involving:
482 (A) a mobile home;
483 (B) a grazing right;
484 (C) a water right; or
485 (D) other personal property authorized by the commissioner.
486 (b) "Escrow" does not include:
487 (i) the following notarial acts performed by a notary within the state:
488 (A) an acknowledgment;
489 (B) a copy certification;
490 (C) jurat; and
491 (D) an oath or affirmation;
492 (ii) the receipt or delivery of a document; or
493 (iii) the receipt of money for delivery to the escrow agent.
494 [
495 requirements of Sections 31A-4-107, 31A-14-211, and 31A-23a-204, who is acting through an
496 individual title insurance producer licensed with an escrow subline of authority.
497 [
498 also excluded.
499 (b) The items listed in a list using the term "excludes" are representative examples for
500 use in interpretation of this title.
501 [
502 insurer does not provide insurance coverage, for whatever reason, for one of the following:
503 (a) a specific physical condition;
504 (b) a specific medical procedure;
505 (c) a specific disease or disorder; or
506 (d) a specific prescription drug or class of prescription drugs.
507 [
508 (a) written to provide a payment for an expense relating to hospital confinement
509 resulting from illness or injury; and
510 (b) written:
511 (i) as a daily limit for a specific number of days in a hospital; and
512 (ii) to have a one or two day waiting period following a hospitalization.
513 [
514 holding a position of public or private trust.
515 [
516 (i) submitted to the department as required by and in accordance with applicable
517 statute, rule, or filing order;
518 (ii) received by the department within the time period provided in applicable statute,
519 rule, or filing order; and
520 (iii) accompanied by the appropriate fee in accordance with:
521 (A) Section 31A-3-103; or
522 (B) rule.
523 (b) "Filed" does not include a filing that is rejected by the department because it is not
524 submitted in accordance with Subsection [
525 [
526 department including:
527 (a) a policy;
528 (b) a rate;
529 (c) a form;
530 (d) a document;
531 (e) a plan;
532 (f) a manual;
533 (g) an application;
534 (h) a report;
535 (i) a certificate;
536 (j) an endorsement;
537 (k) an actuarial certification;
538 (l) a licensee annual statement;
539 (m) a licensee renewal application;
540 (n) an advertisement;
541 (o) a binder; or
542 (p) an outline of coverage.
543 [
544 insurer agrees to pay a claim submitted to it by the insured for the insured's losses.
545 [
546 an alien insurer.
547 [
548 (i) a policy;
549 (ii) a certificate;
550 (iii) an application;
551 (iv) an outline of coverage; or
552 (v) an endorsement.
553 (b) "Form" does not include a document specially prepared for use in an individual
554 case.
555 [
556 through a mass marketing arrangement involving a defined class of persons related in some
557 way other than through the purchase of insurance.
558 [
559 (a) the general lines of insurance in Subsection [
560 (b) title insurance under one of the following sublines of authority:
561 (i) title examination, including authority to act as a title marketing representative;
562 (ii) escrow, including authority to act as a title marketing representative; and
563 (iii) title marketing representative only;
564 (c) surplus lines;
565 (d) workers' compensation; and
566 (e) another line of insurance that the commissioner considers necessary to recognize in
567 the public interest.
568 [
569 (a) accident and health;
570 (b) casualty;
571 (c) life;
572 (d) personal lines;
573 (e) property; and
574 (f) variable contracts, including variable life and annuity.
575 [
576 that the plan provides medical care:
577 (a) (i) to an employee; or
578 (ii) to a dependent of an employee; and
579 (b) (i) directly;
580 (ii) through insurance reimbursement; or
581 (iii) through another method.
582 [
583 that is issued:
584 (i) to a policyholder on behalf of the group; and
585 (ii) for the benefit of a member of the group who is selected under a procedure defined
586 in:
587 (A) the policy; or
588 (B) an agreement that is collateral to the policy.
589 (b) A group insurance policy may include a member of the policyholder's family or a
590 dependent.
591 (77) "Group-wide supervisor" means the commissioner or other regulatory official
592 designated as the group-wide supervisor for an internationally active insurance group under
593 Section 31A-16-108.6.
594 [
595 connection with an extension of credit that pays the difference in amount between the
596 insurance settlement and the balance of the loan if the insured automobile is a total loss.
597 [
598 (79)(b), a policy, contract, certificate, or agreement offered or issued by a health carrier to
599 provide, deliver, arrange for, pay for, or reimburse any of the costs of health care.
600 (b) "Health benefit plan" does not include:
601 (i) coverage only for accident or disability income insurance, or any combination
602 thereof;
603 (ii) coverage issued as a supplement to liability insurance;
604 (iii) liability insurance, including general liability insurance and automobile liability
605 insurance;
606 (iv) workers' compensation or similar insurance;
607 (v) automobile medical payment insurance;
608 (vi) credit-only insurance;
609 (vii) coverage for on-site medical clinics;
610 (viii) other similar insurance coverage, specified in federal regulations issued pursuant
611 to Pub. L. No. 104-191, under which benefits for health care services are secondary or
612 incidental to other insurance benefits;
613 (ix) the following benefits if they are provided under a separate policy, certificate, or
614 contract of insurance or are otherwise not an integral part of the plan:
615 (A) limited scope dental or vision benefits;
616 (B) benefits for long-term care, nursing home care, home health care,
617 community-based care, or any combination thereof; or
618 (C) other similar limited benefits, specified in federal regulations issued pursuant to
619 Pub. L. No. 104-191;
620 (x) the following benefits if the benefits are provided under a separate policy,
621 certificate, or contract of insurance, there is no coordination between the provision of benefits
622 and any exclusion of benefits under any health plan, and the benefits are paid with respect to an
623 event without regard to whether benefits are provided under any health plan:
624 (A) coverage only for specified disease or illness; or
625 (B) hospital indemnity or other fixed indemnity insurance; and
626 (xi) the following if offered as a separate policy, certificate, or contract of insurance:
627 (A) Medicare supplemental health insurance as defined under the Social Security Act,
628 42 U.S.C. Sec. 1395ss(g)(1);
629 (B) coverage supplemental to the coverage provided under United States Code, Title
630 10, Chapter 55, Civilian Health and Medical Program of the Uniformed Services
631 (CHAMPUS); or
632 (C) similar supplemental coverage provided to coverage under a group health insurance
633 plan.
634 [
635 treatment, mitigation, or prevention of a human ailment or impairment:
636 (a) a professional service;
637 (b) a personal service;
638 (c) a facility;
639 (d) equipment;
640 (e) a device;
641 (f) supplies; or
642 (g) medicine.
643 [
644 providing:
645 (i) a health care benefit; or
646 (ii) payment of an incurred health care expense.
647 (b) "Health care insurance" or "health insurance" does not include accident and health
648 insurance providing a benefit for:
649 (i) replacement of income;
650 (ii) short-term accident;
651 (iii) fixed indemnity;
652 (iv) credit accident and health;
653 (v) supplements to liability;
654 (vi) workers' compensation;
655 (vii) automobile medical payment;
656 (viii) no-fault automobile;
657 (ix) equivalent self-insurance; or
658 (x) a type of accident and health insurance coverage that is a part of or attached to
659 another type of policy.
660 [
661 78B-3-403.
662 [
663 Sec. 155.20.
664 [
665 Insurance Portability and Accountability Act of 1996, Pub. L. No. 104-191, 110 Stat. 1936, as
666 amended.
667 [
668 insurance written to provide payments to replace income lost from accident or sickness.
669 [
670 insured loss.
671 [
672 under Section 31A-26-201 who engages in insurance adjusting as a representative of an insurer.
673 [
674 Section 31A-15-104.
675 [
676 [
677 (a) property in transit on or over land;
678 (b) property in transit over water by means other than boat or ship;
679 (c) bailee liability;
680 (d) fixed transportation property such as bridges, electric transmission systems, radio
681 and television transmission towers and tunnels; and
682 (e) personal and commercial property floaters.
683 [
684 (a) an insurer is unable to pay the insurer's obligations as the obligations are due;
685 (b) an insurer's total adjusted capital is less than the insurer's mandatory control level
686 RBC under Subsection 31A-17-601(8)(c); or
687 (c) an insurer's admitted assets are less than the insurer's liabilities.
688 [
689 (i) an arrangement, contract, or plan for the transfer of a risk or risks from one or more
690 persons to one or more other persons; or
691 (ii) an arrangement, contract, or plan for the distribution of a risk or risks among a
692 group of persons that includes the person seeking to distribute that person's risk.
693 (b) "Insurance" includes:
694 (i) a risk distributing arrangement providing for compensation or replacement for
695 damages or loss through the provision of a service or a benefit in kind;
696 (ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a
697 business and not as merely incidental to a business transaction; and
698 (iii) a plan in which the risk does not rest upon the person who makes an arrangement,
699 but with a class of persons who have agreed to share the risk.
700 [
701 investigation, negotiation, or settlement of a claim under an insurance policy other than life
702 insurance or an annuity, on behalf of an insurer, policyholder, or a claimant under an insurance
703 policy.
704 [
705 (a) providing health care insurance by an organization that is or is required to be
706 licensed under this title;
707 (b) providing a benefit to an employee in the event of a contingency not within the
708 control of the employee, in which the employee is entitled to the benefit as a right, which
709 benefit may be provided either:
710 (i) by a single employer or by multiple employer groups; or
711 (ii) through one or more trusts, associations, or other entities;
712 (c) providing an annuity:
713 (i) including an annuity issued in return for a gift; and
714 (ii) except an annuity provided by a person specified in Subsections 31A-22-1305(2)
715 and (3);
716 (d) providing the characteristic services of a motor club as outlined in Subsection
717 [
718 (e) providing another person with insurance;
719 (f) making as insurer, guarantor, or surety, or proposing to make as insurer, guarantor,
720 or surety, a contract or policy of title insurance;
721 (g) transacting or proposing to transact any phase of title insurance, including:
722 (i) solicitation;
723 (ii) negotiation preliminary to execution;
724 (iii) execution of a contract of title insurance;
725 (iv) insuring; and
726 (v) transacting matters subsequent to the execution of the contract and arising out of
727 the contract, including reinsurance;
728 (h) transacting or proposing a life settlement; and
729 (i) doing, or proposing to do, any business in substance equivalent to Subsections
730 [
731 [
732 (a) advises another person about insurance needs and coverages;
733 (b) is compensated by the person advised on a basis not directly related to the insurance
734 placed; and
735 (c) except as provided in Section 31A-23a-501, is not compensated directly or
736 indirectly by an insurer or producer for advice given.
737 (96) "Insurance group" means the persons that comprise an insurance holding company
738 system.
739 [
740 affiliated persons, at least one of whom is an insurer.
741 [
742 to be licensed under the laws of this state to sell, solicit, or negotiate insurance.
743 (b) (i) "Producer for the insurer" means a producer who is compensated directly or
744 indirectly by an insurer for selling, soliciting, or negotiating an insurance product of that
745 insurer.
746 (ii) "Producer for the insurer" may be referred to as an "agent."
747 (c) (i) "Producer for the insured" means a producer who:
748 (A) is compensated directly and only by an insurance customer or an insured; and
749 (B) receives no compensation directly or indirectly from an insurer for selling,
750 soliciting, or negotiating an insurance product of that insurer to an insurance customer or
751 insured.
752 (ii) "Producer for the insured" may be referred to as a "broker."
753 [
754 makes a promise in an insurance policy and includes:
755 (i) a policyholder;
756 (ii) a subscriber;
757 (iii) a member; and
758 (iv) a beneficiary.
759 (b) The definition in Subsection [
760 (i) applies only to this title;
761 (ii) does not define the meaning of "insured" as used in an insurance policy or
762 certificate; and
763 (iii) includes an enrollee.
764 [
765 including:
766 (i) a fraternal benefit society;
767 (ii) an issuer of a gift annuity other than an annuity specified in Subsections
768 31A-22-1305(2) and (3);
769 (iii) a motor club;
770 (iv) an employee welfare plan;
771 (v) a person purporting or intending to do an insurance business as a principal on that
772 person's own account; and
773 (vi) a health maintenance organization.
774 (b) "Insurer" does not include a governmental entity [
775
776 [
777 Subsection [
778 (102) "Internationally active insurance group" means an insurance holding company
779 system:
780 (a) that includes an insurer registered under Section 34A-16-105;
781 (b) that has premiums written in at least three countries;
782 (c) whose percentage of gross premiums written outside the United States is at least
783 10% of its total gross written premiums; and
784 (d) that, based on a three-year rolling average, has:
785 (i) total assets of at least $50,000,000,000; or
786 (ii) total gross written premiums of at least $10,000,000,000.
787 [
788 (a) offered in connection with an extension of credit; and
789 (b) that provides indemnity if the debtor is involuntarily unemployed for payments
790 coming due on a:
791 (i) specific loan; or
792 (ii) credit transaction.
793 [
794 employer who, with respect to a calendar year and to a plan year:
795 (i) employed an average of at least 51 employees on business days during the preceding
796 calendar year; and
797 (ii) employs at least one employee on the first day of the plan year.
798 (b) The number of employees shall be determined using the method set forth in 26
799 U.S.C. Sec. 4980H(c)(2).
800 [
801 an individual whose enrollment is a late enrollment.
802 [
803 enrollment of an individual other than:
804 (a) on the earliest date on which coverage can become effective for the individual
805 under the terms of the plan; or
806 (b) through special enrollment.
807 [
808 31A-1-103, "legal expense insurance" means insurance written to indemnify or pay for a
809 specified legal expense.
810 (b) "Legal expense insurance" includes an arrangement that creates a reasonable
811 expectation of an enforceable right.
812 (c) "Legal expense insurance" does not include the provision of, or reimbursement for,
813 legal services incidental to other insurance coverage.
814 [
815 (i) for death, injury, or disability of a human being, or for damage to property,
816 exclusive of the coverages under:
817 (A) medical malpractice insurance;
818 (B) professional liability insurance; and
819 (C) workers' compensation insurance;
820 (ii) for a medical, hospital, surgical, and funeral benefit to a person other than the
821 insured who is injured, irrespective of legal liability of the insured, when issued with or
822 supplemental to insurance against legal liability for the death, injury, or disability of a human
823 being, exclusive of the coverages under:
824 (A) medical malpractice insurance;
825 (B) professional liability insurance; and
826 (C) workers' compensation insurance;
827 (iii) for loss or damage to property resulting from an accident to or explosion of a
828 boiler, pipe, pressure container, machinery, or apparatus;
829 (iv) for loss or damage to property caused by:
830 (A) the breakage or leakage of a sprinkler, water pipe, or water container; or
831 (B) water entering through a leak or opening in a building; or
832 (v) for other loss or damage properly the subject of insurance not within another kind
833 of insurance as defined in this chapter, if the insurance is not contrary to law or public policy.
834 (b) "Liability insurance" includes:
835 (i) vehicle liability insurance;
836 (ii) residential dwelling liability insurance; and
837 (iii) making inspection of, and issuing a certificate of inspection upon, an elevator,
838 boiler, machinery, or apparatus of any kind when done in connection with insurance on the
839 elevator, boiler, machinery, or apparatus.
840 [
841 in an activity that is part of or related to the insurance business.
842 (b) "License" includes a certificate of authority issued to an insurer.
843 [
844 (i) insurance on a human life; and
845 (ii) insurance pertaining to or connected with human life.
846 (b) The business of life insurance includes:
847 (i) granting a death benefit;
848 (ii) granting an annuity benefit;
849 (iii) granting an endowment benefit;
850 (iv) granting an additional benefit in the event of death by accident;
851 (v) granting an additional benefit to safeguard the policy against lapse; and
852 (vi) providing an optional method of settlement of proceeds.
853 [
854 (a) is issued for a specific product of insurance; and
855 (b) limits an individual or agency to transact only for that product or insurance.
856 [
857 insurance:
858 (a) credit life;
859 (b) credit accident and health;
860 (c) credit property;
861 (d) credit unemployment;
862 (e) involuntary unemployment;
863 (f) mortgage life;
864 (g) mortgage guaranty;
865 (h) mortgage accident and health;
866 (i) guaranteed automobile protection; and
867 (j) another form of insurance offered in connection with an extension of credit that:
868 (i) is limited to partially or wholly extinguishing the credit obligation; and
869 (ii) the commissioner determines by rule should be designated as a form of limited line
870 credit insurance.
871 [
872 solicits, or negotiates one or more forms of limited line credit insurance coverage to an
873 individual through a master, corporate, group, or individual policy.
874 [
875 (a) bail bond;
876 (b) limited line credit insurance;
877 (c) legal expense insurance;
878 (d) motor club insurance;
879 (e) car rental related insurance;
880 (f) travel insurance;
881 (g) crop insurance;
882 (h) self-service storage insurance;
883 (i) guaranteed asset protection waiver;
884 (j) portable electronics insurance; and
885 (k) another form of limited insurance that the commissioner determines by rule should
886 be designated a form of limited line insurance.
887 [
888 Subsection [
889 [
890 limited lines insurance.
891 [
892 advertised, marketed, offered, or designated to provide coverage:
893 (i) in a setting other than an acute care unit of a hospital;
894 (ii) for not less than 12 consecutive months for a covered person on the basis of:
895 (A) expenses incurred;
896 (B) indemnity;
897 (C) prepayment; or
898 (D) another method;
899 (iii) for one or more necessary or medically necessary services that are:
900 (A) diagnostic;
901 (B) preventative;
902 (C) therapeutic;
903 (D) rehabilitative;
904 (E) maintenance; or
905 (F) personal care; and
906 (iv) that may be issued by:
907 (A) an insurer;
908 (B) a fraternal benefit society;
909 (C) (I) a nonprofit health hospital; and
910 (II) a medical service corporation;
911 (D) a prepaid health plan;
912 (E) a health maintenance organization; or
913 (F) an entity similar to the entities described in Subsections [
914 through (E) to the extent that the entity is otherwise authorized to issue life or health care
915 insurance.
916 (b) "Long-term care insurance" includes:
917 (i) any of the following that provide directly or supplement long-term care insurance:
918 (A) a group or individual annuity or rider; or
919 (B) a life insurance policy or rider;
920 (ii) a policy or rider that provides for payment of benefits on the basis of:
921 (A) cognitive impairment; or
922 (B) functional capacity; or
923 (iii) a qualified long-term care insurance contract.
924 (c) "Long-term care insurance" does not include:
925 (i) a policy that is offered primarily to provide basic Medicare supplement coverage;
926 (ii) basic hospital expense coverage;
927 (iii) basic medical/surgical expense coverage;
928 (iv) hospital confinement indemnity coverage;
929 (v) major medical expense coverage;
930 (vi) income replacement or related asset-protection coverage;
931 (vii) accident only coverage;
932 (viii) coverage for a specified:
933 (A) disease; or
934 (B) accident;
935 (ix) limited benefit health coverage; or
936 (x) a life insurance policy that accelerates the death benefit to provide the option of a
937 lump sum payment:
938 (A) if the following are not conditioned on the receipt of long-term care:
939 (I) benefits; or
940 (II) eligibility; and
941 (B) the coverage is for one or more the following qualifying events:
942 (I) terminal illness;
943 (II) medical conditions requiring extraordinary medical intervention; or
944 (III) permanent institutional confinement.
945 [
946 (a) licensed as a health maintenance organization under Chapter 8, Health Maintenance
947 Organizations and Limited Health Plans; or
948 (b) (i) licensed under:
949 (A) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
950 (B) Chapter 7, Nonprofit Health Service Insurance Corporations; or
951 (C) Chapter 14, Foreign Insurers; and
952 (ii) that requires an enrollee to use, or offers incentives, including financial incentives,
953 for an enrollee to use, network providers.
954 [
955 incident to the practice and provision of a medical service other than the practice and provision
956 of a dental service.
957 [
958 corporation.
959 [
960 must be constantly maintained by a stock insurance corporation as required by statute.
961 [
962 connection with an extension of credit that provides indemnity for payments coming due on a
963 mortgage while the debtor has a disability.
964 [
965 mortgagee or other creditor is indemnified against losses caused by the default of a debtor.
966 [
967 connection with an extension of credit that pays if the debtor dies.
968 [
969 (a) licensed under:
970 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
971 (ii) Chapter 11, Motor Clubs; or
972 (iii) Chapter 14, Foreign Insurers; and
973 (b) that promises for an advance consideration to provide for a stated period of time
974 one or more:
975 (i) legal services under Subsection 31A-11-102(1)(b);
976 (ii) bail services under Subsection 31A-11-102(1)(c); or
977 (iii) (A) trip reimbursement;
978 (B) towing services;
979 (C) emergency road services;
980 (D) stolen automobile services;
981 (E) a combination of the services listed in Subsections [
982 (D); or
983 (F) other services given in Subsections 31A-11-102(1)(b) through (f).
984 [
985 [
986 (a) that is issued by an insurer; and
987 (b) under which the financing and delivery of medical care is provided, in whole or in
988 part, through a defined set of providers under contract with the insurer, including the financing
989 and delivery of an item paid for as medical care.
990 [
991 with a managed care organization to provide health care services to an enrollee with an
992 expectation of receiving payment, other than coinsurance, copayments, or deductibles, directly
993 from the managed care organization.
994 [
995 not entitled to receive a dividend representing a share of the surplus of the insurer.
996 [
997 (a) ships or hulls of ships;
998 (b) goods, freight, cargoes, merchandise, effects, disbursements, profits, money,
999 securities, choses in action, evidences of debt, valuable papers, bottomry, respondentia
1000 interests, or other cargoes in or awaiting transit over the oceans or inland waterways;
1001 (c) earnings such as freight, passage money, commissions, or profits derived from
1002 transporting goods or people upon or across the oceans or inland waterways; or
1003 (d) a vessel owner or operator as a result of liability to employees, passengers, bailors,
1004 owners of other vessels, owners of fixed objects, customs or other authorities, or other persons
1005 in connection with maritime activity.
1006 [
1007 (132) "ORSA guidance manual" means the current version of the Own Risk and
1008 Solvency Assessment Guidance Manual developed and adopted by the National Association of
1009 Insurance Commissioners and as amended from time to time.
1010 (133) "ORSA summary report" means a confidential high-level summary of an insurer
1011 or insurance group's own risk and solvency assessment.
1012 [
1013 health insurance policy.
1014 (135) "Own risk and solvency assessment" means an insurer or insurance group's
1015 confidential internal assessment:
1016 (a) (i) of each material and relevant risk associated with the insurer or insurance group;
1017 (ii) of the insurer or insurance group's current business plan to support each risk
1018 described in Subsection (135)(a)(i); and
1019 (iii) of the sufficiency of capital resources to support each risk described in Subsection
1020 (135)(a)(i); and
1021 (b) that is appropriate to the nature, scale, and complexity of an insurer or insurance
1022 group.
1023 [
1024 entitled to receive a dividend representing a share of the surplus of the insurer.
1025 [
1026 relating to the minimum percentage of eligible employees that must be enrolled in relation to
1027 the total number of eligible employees of an employer reduced by each eligible employee who
1028 voluntarily declines coverage under the plan because the employee:
1029 (a) has other group health care insurance coverage; or
1030 (b) receives:
1031 (i) Medicare, under the Health Insurance for the Aged Act, Title XVIII of the Social
1032 Security Amendments of 1965; or
1033 (ii) another government health benefit.
1034 [
1035 (a) an individual;
1036 (b) a partnership;
1037 (c) a corporation;
1038 (d) an incorporated or unincorporated association;
1039 (e) a joint stock company;
1040 (f) a trust;
1041 (g) a limited liability company;
1042 (h) a reciprocal;
1043 (i) a syndicate; or
1044 (j) another similar entity or combination of entities acting in concert.
1045 [
1046 coverage sold for primarily noncommercial purposes to:
1047 (a) an individual; or
1048 (b) a family.
1049 [
1050 1002(16)(B).
1051 [
1052 (a) the year that is designated as the plan year in:
1053 (i) the plan document of a group health plan; or
1054 (ii) a summary plan description of a group health plan;
1055 (b) if the plan document or summary plan description does not designate a plan year or
1056 there is no plan document or summary plan description:
1057 (i) the year used to determine deductibles or limits;
1058 (ii) the policy year, if the plan does not impose deductibles or limits on a yearly basis;
1059 or
1060 (iii) the employer's taxable year if:
1061 (A) the plan does not impose deductibles or limits on a yearly basis; and
1062 (B) (I) the plan is not insured; or
1063 (II) the insurance policy is not renewed on an annual basis; or
1064 (c) in a case not described in Subsection [
1065 [
1066 application that:
1067 (i) purports to be an enforceable contract; and
1068 (ii) memorializes in writing some or all of the terms of an insurance contract.
1069 (b) "Policy" includes a service contract issued by:
1070 (i) a motor club under Chapter 11, Motor Clubs;
1071 (ii) a service contract provided under Chapter 6a, Service Contracts; and
1072 (iii) a corporation licensed under:
1073 (A) Chapter 7, Nonprofit Health Service Insurance Corporations; or
1074 (B) Chapter 8, Health Maintenance Organizations and Limited Health Plans.
1075 (c) "Policy" does not include:
1076 (i) a certificate under a group insurance contract; or
1077 (ii) a document that does not purport to have legal effect.
1078 [
1079 contract by ownership, premium payment, or otherwise.
1080 [
1081 nonguaranteed elements of a policy of life insurance over a period of years.
1082 [
1083 insurance policy.
1084 [
1085 No. 111-148 and the Health Care Education Reconciliation Act of 2010, Pub. L. No. 111-152,
1086 and related federal regulations and guidance.
1087 [
1088 (a) means a condition that was present before the effective date of coverage, whether or
1089 not medical advice, diagnosis, care, or treatment was recommended or received before that day;
1090 and
1091 (b) does not include a condition indicated by genetic information unless an actual
1092 diagnosis of the condition by a physician has been made.
1093 [
1094 (b) "Premium" includes, however designated:
1095 (i) an assessment;
1096 (ii) a membership fee;
1097 (iii) a required contribution; or
1098 (iv) monetary consideration.
1099 (c) (i) "Premium" does not include consideration paid to a third party administrator for
1100 the third party administrator's services.
1101 (ii) "Premium" includes an amount paid by a third party administrator to an insurer for
1102 insurance on the risks administered by the third party administrator.
1103 [
1104 Subsection 31A-5-203(3).
1105 [
1106 [
1107 incident to the practice of a profession and provision of a professional service.
1108 [
1109 insurance" means insurance against loss or damage to real or personal property of every kind
1110 and any interest in that property:
1111 (i) from all hazards or causes; and
1112 (ii) against loss consequential upon the loss or damage including vehicle
1113 comprehensive and vehicle physical damage coverages.
1114 (b) "Property insurance" does not include:
1115 (i) inland marine insurance; and
1116 (ii) ocean marine insurance.
1117 [
1118 long-term care insurance contract" means:
1119 (a) an individual or group insurance contract that meets the requirements of Section
1120 7702B(b), Internal Revenue Code; or
1121 (b) the portion of a life insurance contract that provides long-term care insurance:
1122 (i) (A) by rider; or
1123 (B) as a part of the contract; and
1124 (ii) that satisfies the requirements of Sections 7702B(b) and (e), Internal Revenue
1125 Code.
1126 [
1127 (a) is:
1128 (i) organized under the laws of the United States or any state; or
1129 (ii) in the case of a United States office of a foreign banking organization, licensed
1130 under the laws of the United States or any state;
1131 (b) is regulated, supervised, and examined by a United States federal or state authority
1132 having regulatory authority over a bank or trust company; and
1133 (c) meets the standards of financial condition and standing that are considered
1134 necessary and appropriate to regulate the quality of a financial institution whose letters of credit
1135 will be acceptable to the commissioner as determined by:
1136 (i) the commissioner by rule; or
1137 (ii) the Securities Valuation Office of the National Association of Insurance
1138 Commissioners.
1139 [
1140 (i) the cost of a given unit of insurance; or
1141 (ii) for property or casualty insurance, that cost of insurance per exposure unit either
1142 expressed as:
1143 (A) a single number; or
1144 (B) a pure premium rate, adjusted before the application of individual risk variations
1145 based on loss or expense considerations to account for the treatment of:
1146 (I) expenses;
1147 (II) profit; and
1148 (III) individual insurer variation in loss experience.
1149 (b) "Rate" does not include a minimum premium.
1150 [
1151 organization" means a person who assists an insurer in rate making or filing by:
1152 (i) collecting, compiling, and furnishing loss or expense statistics;
1153 (ii) recommending, making, or filing rates or supplementary rate information; or
1154 (iii) advising about rate questions, except as an attorney giving legal advice.
1155 (b) "Rate service organization" does not mean:
1156 (i) an employee of an insurer;
1157 (ii) a single insurer or group of insurers under common control;
1158 (iii) a joint underwriting group; or
1159 (iv) an individual serving as an actuarial or legal consultant.
1160 [
1161 renewal policy premiums:
1162 (a) a manual of rates;
1163 (b) a classification;
1164 (c) a rate-related underwriting rule; and
1165 (d) a rating formula that describes steps, policies, and procedures for determining
1166 initial and renewal policy premiums.
1167 [
1168 pay, allow, or give, directly or indirectly:
1169 (i) a refund of premium or portion of premium;
1170 (ii) a refund of commission or portion of commission;
1171 (iii) a refund of all or a portion of a consultant fee; or
1172 (iv) providing services or other benefits not specified in an insurance or annuity
1173 contract.
1174 (b) "Rebate" does not include:
1175 (i) a refund due to termination or changes in coverage;
1176 (ii) a refund due to overcharges made in error by the licensee; or
1177 (iii) savings or wellness benefits as provided in the contract by the licensee.
1178 [
1179 (a) the date delivered to and stamped received by the department, if delivered in
1180 person;
1181 (b) the post mark date, if delivered by mail;
1182 (c) the delivery service's post mark or pickup date, if delivered by a delivery service;
1183 (d) the received date recorded on an item delivered, if delivered by:
1184 (i) facsimile;
1185 (ii) email; or
1186 (iii) another electronic method; or
1187 (e) a date specified in:
1188 (i) a statute;
1189 (ii) a rule; or
1190 (iii) an order.
1191 [
1192 association of persons:
1193 (a) operating through an attorney-in-fact common to all of the persons; and
1194 (b) exchanging insurance contracts with one another that provide insurance coverage
1195 on each other.
1196 [
1197 consideration, transfers any portion of the risk it has assumed to another insurer. In referring to
1198 reinsurance transactions, this title sometimes refers to:
1199 (a) the insurer transferring the risk as the "ceding insurer"; and
1200 (b) the insurer assuming the risk as the:
1201 (i) "assuming insurer"; or
1202 (ii) "assuming reinsurer."
1203 [
1204 authority to assume reinsurance.
1205 [
1206 liability resulting from or incident to the ownership, maintenance, or use of a residential
1207 dwelling that is a detached single family residence or multifamily residence up to four units.
1208 [
1209 assumed under a reinsurance contract.
1210 (b) A reinsurer "retrocedes" when the reinsurer reinsures with another insurer part of a
1211 liability assumed under a reinsurance contract.
1212 [
1213 (a) an insurance policy; or
1214 (b) an insurance certificate.
1215 [
1216 exclusion from coverage in accident and health insurance.
1217 [
1218 (i) note;
1219 (ii) stock;
1220 (iii) bond;
1221 (iv) debenture;
1222 (v) evidence of indebtedness;
1223 (vi) certificate of interest or participation in a profit-sharing agreement;
1224 (vii) collateral-trust certificate;
1225 (viii) preorganization certificate or subscription;
1226 (ix) transferable share;
1227 (x) investment contract;
1228 (xi) voting trust certificate;
1229 (xii) certificate of deposit for a security;
1230 (xiii) certificate of interest of participation in an oil, gas, or mining title or lease or in
1231 payments out of production under such a title or lease;
1232 (xiv) commodity contract or commodity option;
1233 (xv) certificate of interest or participation in, temporary or interim certificate for,
1234 receipt for, guarantee of, or warrant or right to subscribe to or purchase any of the items listed
1235 in Subsections [
1236 (xvi) another interest or instrument commonly known as a security.
1237 (b) "Security" does not include:
1238 (i) any of the following under which an insurance company promises to pay money in a
1239 specific lump sum or periodically for life or some other specified period:
1240 (A) insurance;
1241 (B) an endowment policy; or
1242 (C) an annuity contract; or
1243 (ii) a burial certificate or burial contract.
1244 [
1245 person, including:
1246 (a) common stock;
1247 (b) preferred stock;
1248 (c) debt obligations; and
1249 (d) any other security convertible into or evidencing the right of any of the items listed
1250 in this Subsection [
1251 [
1252 provides for spreading its own risks by a systematic plan.
1253 (b) Except as provided in this Subsection [
1254 include an arrangement under which a number of persons spread their risks among themselves.
1255 (c) "Self-insurance" includes:
1256 (i) an arrangement by which a governmental entity undertakes to indemnify an
1257 employee for liability arising out of the employee's employment; and
1258 (ii) an arrangement by which a person with a managed program of self-insurance and
1259 risk management undertakes to indemnify its affiliates, subsidiaries, directors, officers, or
1260 employees for liability or risk that is related to the relationship or employment.
1261 (d) "Self-insurance" does not include an arrangement with an independent contractor.
1262 [
1263 (a) by any means;
1264 (b) for money or its equivalent; and
1265 (c) on behalf of an insurance company.
1266 [
1267 advertised, marketed, offered, or designed to provide coverage that is similar to long-term care
1268 insurance, but that provides coverage for less than 12 consecutive months for each covered
1269 person.
1270 (172) "Short-term limited duration health insurance" means a health benefit product
1271 that:
1272 (a) after taking into account any renewals or extensions, has a total duration of no more
1273 than 36 months; and
1274 (b) has an expiration date specified in the contract that is less than 12 months after the
1275 original effective date of coverage under the health benefit product.
1276 [
1277 during each of which an individual does not have creditable coverage.
1278 [
1279 with respect to a calendar year and to a plan year, an employer who:
1280 (i) (A) employed at least one but not more than 50 eligible employees on business days
1281 during the preceding calendar year; or
1282 (B) if the employer did not exist for the entirety of the preceding calendar year,
1283 reasonably expects to employ an average of at least one but not more than 50 eligible
1284 employees on business days during the current calendar year;
1285 (ii) employs at least one employee on the first day of the plan year; and
1286 (iii) for an employer who has common ownership with one or more other employers, is
1287 treated as a single employer under 26 U.S.C. Sec. 414(b), (c), (m), or (o).
1288 (b) "Small employer" does not include a sole proprietor that does not employ at least
1289 one employee.
1290 [
1291 the same meaning as provided in federal regulations adopted pursuant to the Health Insurance
1292 Portability and Accountability Act.
1293 [
1294 either directly or indirectly through one or more affiliates or intermediaries.
1295 (b) "Wholly owned subsidiary" of a person is a subsidiary of which all of the voting
1296 shares are owned by that person either alone or with its affiliates, except for the minimum
1297 number of shares the law of the subsidiary's domicile requires to be owned by directors or
1298 others.
1299 [
1300 (a) a guarantee against loss or damage resulting from the failure of a principal to pay or
1301 perform the principal's obligations to a creditor or other obligee;
1302 (b) bail bond insurance; and
1303 (c) fidelity insurance.
1304 [
1305 and liabilities.
1306 (b) (i) "Permanent surplus" means the surplus of an insurer or organization that is
1307 designated by the insurer or organization as permanent.
1308 (ii) Sections 31A-5-211, 31A-7-201, 31A-8-209, 31A-9-209, and 31A-14-205 require
1309 that insurers or organizations doing business in this state maintain specified minimum levels of
1310 permanent surplus.
1311 (iii) Except for assessable mutuals, the minimum permanent surplus requirement is the
1312 same as the minimum required capital requirement that applies to stock insurers.
1313 (c) "Excess surplus" means:
1314 (i) for a life insurer, accident and health insurer, health organization, or property and
1315 casualty insurer as defined in Section 31A-17-601, the lesser of:
1316 (A) that amount of an insurer's or health organization's total adjusted capital that
1317 exceeds the product of:
1318 (I) 2.5; and
1319 (II) the sum of the insurer's or health organization's minimum capital or permanent
1320 surplus required under Section 31A-5-211, 31A-9-209, or 31A-14-205; or
1321 (B) that amount of an insurer's or health organization's total adjusted capital that
1322 exceeds the product of:
1323 (I) 3.0; and
1324 (II) the authorized control level RBC as defined in Subsection 31A-17-601(8)(a); and
1325 (ii) for a monoline mortgage guaranty insurer, financial guaranty insurer, or title insurer
1326 that amount of an insurer's paid-in-capital and surplus that exceeds the product of:
1327 (A) 1.5; and
1328 (B) the insurer's total adjusted capital required by Subsection 31A-17-609(1).
1329 [
1330 collects charges or premiums from, or who, for consideration, adjusts or settles claims of
1331 residents of the state in connection with insurance coverage, annuities, or service insurance
1332 coverage, except:
1333 (a) a union on behalf of its members;
1334 (b) a person administering a:
1335 (i) pension plan subject to the federal Employee Retirement Income Security Act of
1336 1974;
1337 (ii) governmental plan as defined in Section 414(d), Internal Revenue Code; or
1338 (iii) nonelecting church plan as described in Section 410(d), Internal Revenue Code;
1339 (c) an employer on behalf of the employer's employees or the employees of one or
1340 more of the subsidiary or affiliated corporations of the employer;
1341 (d) an insurer licensed under the following, but only for a line of insurance for which
1342 the insurer holds a license in this state:
1343 (i) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
1344 (ii) Chapter 7, Nonprofit Health Service Insurance Corporations;
1345 (iii) Chapter 8, Health Maintenance Organizations and Limited Health Plans;
1346 (iv) Chapter 9, Insurance Fraternals; or
1347 (v) Chapter 14, Foreign Insurers;
1348 (e) a person:
1349 (i) licensed or exempt from licensing under:
1350 (A) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and
1351 Reinsurance Intermediaries; or
1352 (B) Chapter 26, Insurance Adjusters; and
1353 (ii) whose activities are limited to those authorized under the license the person holds
1354 or for which the person is exempt; or
1355 (f) an institution, bank, or financial institution:
1356 (i) that is:
1357 (A) an institution whose deposits and accounts are to any extent insured by a federal
1358 deposit insurance agency, including the Federal Deposit Insurance Corporation or National
1359 Credit Union Administration; or
1360 (B) a bank or other financial institution that is subject to supervision or examination by
1361 a federal or state banking authority; and
1362 (ii) that does not adjust claims without a third party administrator license.
1363 [
1364 owner of real or personal property or the holder of liens or encumbrances on that property, or
1365 others interested in the property against loss or damage suffered by reason of liens or
1366 encumbrances upon, defects in, or the unmarketability of the title to the property, or invalidity
1367 or unenforceability of any liens or encumbrances on the property.
1368 [
1369 organization's statutory capital and surplus as determined in accordance with:
1370 (a) the statutory accounting applicable to the annual financial statements required to be
1371 filed under Section 31A-4-113; and
1372 (b) another item provided by the RBC instructions, as RBC instructions is defined in
1373 Section 31A-17-601.
1374 [
1375 a corporation.
1376 (b) "Trustee," when used in reference to an employee welfare fund, means an
1377 individual, firm, association, organization, joint stock company, or corporation, whether acting
1378 individually or jointly and whether designated by that name or any other, that is charged with
1379 or has the overall management of an employee welfare fund.
1380 [
1381 insurer" means an insurer:
1382 (i) not holding a valid certificate of authority to do an insurance business in this state;
1383 or
1384 (ii) transacting business not authorized by a valid certificate.
1385 (b) "Admitted insurer" or "authorized insurer" means an insurer:
1386 (i) holding a valid certificate of authority to do an insurance business in this state; and
1387 (ii) transacting business as authorized by a valid certificate.
1388 [
1389 insurer.
1390 [
1391 from or incident to ownership, maintenance, or use of a land vehicle or aircraft, exclusive of a
1392 vehicle comprehensive or vehicle physical damage coverage under Subsection [
1393 [
1394 security convertible into a security with a voting right associated with the security.
1395 [
1396 pass before coverage for an individual, who is otherwise eligible to enroll under the terms of
1397 the health benefit plan, can become effective.
1398 [
1399 (a) insurance for indemnification of an employer against liability for compensation
1400 based on:
1401 (i) a compensable accidental injury; and
1402 (ii) occupational disease disability;
1403 (b) employer's liability insurance incidental to workers' compensation insurance and
1404 written in connection with workers' compensation insurance; and
1405 (c) insurance assuring to a person entitled to workers' compensation benefits the
1406 compensation provided by law.
1407 Section 2. Section 31A-2-403 is amended to read:
1408 31A-2-403. Title and Escrow Commission created.
1409 (1) (a) Subject to Subsection (1)(b), there is created within the department the Title and
1410 Escrow Commission that is comprised of five members appointed by the governor with the
1411 consent of the Senate as follows:
1412 (i) except as provided in Subsection (1)(c), two members shall be employees of a title
1413 insurer;
1414 (ii) two members shall:
1415 (A) be employees of a Utah agency title insurance producer;
1416 (B) be or have been licensed under the title insurance line of authority;
1417 (C) as of the day on which the member is appointed, be or have been licensed with the
1418 title examination or escrow subline of authority for at least five years; and
1419 (D) as of the day on which the member is appointed, not be from the same county as
1420 another member appointed under this Subsection (1)(a)(ii); and
1421 (iii) one member shall be a member of the general public from any county in the state.
1422 (b) No more than one commission member may be appointed from a single company
1423 or an affiliate or subsidiary of the company.
1424 (c) If the governor is unable to identify more than one individual who is an employee
1425 of a title insurer and willing to serve as a member of the commission, the commission shall
1426 include the following members in lieu of the members described in Subsection (1)(a)(i):
1427 (i) one member who is an employee of a title insurer; and
1428 (ii) one member who is an employee of a Utah agency title insurance producer.
1429 (2) (a) Subject to Subsection (2)(c), a commission member shall file with the
1430 commissioner a disclosure of any position of employment or ownership interest that the
1431 commission member has with respect to a person that is subject to the jurisdiction of the
1432 commissioner.
1433 (b) The disclosure statement required by this Subsection (2) shall be:
1434 (i) filed by no later than the day on which the person begins that person's appointment;
1435 and
1436 (ii) amended when a significant change occurs in any matter required to be disclosed
1437 under this Subsection (2).
1438 (c) A commission member is not required to disclose an ownership interest that the
1439 commission member has if the ownership interest is in a publicly traded company or held as
1440 part of a mutual fund, trust, or similar investment.
1441 (3) (a) Except as required by Subsection (3)(b), as terms of current commission
1442 members expire, the governor shall appoint each new commission member to a four-year term
1443 ending on June 30.
1444 (b) Notwithstanding the requirements of Subsection (3)(a), the governor shall, at the
1445 time of appointment, adjust the length of terms to ensure that the terms of the commission
1446 members are staggered so that approximately half of the members appointed under Subsection
1447 (1)(a)(i) and half of the members appointed under Subsection (1)(a)(ii) are appointed every two
1448 years.
1449 (c) A commission member may not serve more than one consecutive term.
1450 (d) When a vacancy occurs in the membership for any reason, the governor, with the
1451 consent of the Senate, shall appoint a replacement for the unexpired term.
1452 (e) Notwithstanding the other provisions of this Subsection (3), a commission member
1453 serves until a successor is appointed by the governor with the consent of the Senate.
1454 (4) A commission member may not receive compensation or benefits for the
1455 commission member's service, but may receive per diem and travel expenses in accordance
1456 with:
1457 (a) Section 63A-3-106;
1458 (b) Section 63A-3-107; and
1459 (c) rules made by the Division of Finance pursuant to Sections 63A-3-106 and
1460 63A-3-107.
1461 (5) Members of the commission shall annually select one commission member to serve
1462 as chair.
1463 (6) (a) (i) The commission shall meet at least [
1464 (ii) Notwithstanding Section 52-4-207, a commission member shall physically attend a
1465 regularly scheduled [
1466 electronic means.
1467 (iii) A commission member may attend subcommittee meetings, emergency meetings,
1468 or other not regularly scheduled meetings electronically in accordance with Section 52-4-207.
1469 (b) The commissioner may call additional meetings:
1470 (i) at the commissioner's discretion;
1471 (ii) upon the request of the chair of the commission; or
1472 (iii) upon the written request of three or more commission members.
1473 (c) (i) Three commission members constitute a quorum for the transaction of business.
1474 (ii) The action of a majority of the commission members when a quorum is present is
1475 the action of the commission.
1476 (7) The commissioner shall staff the commission.
1477 Section 3. Section 31A-16-108.6 is enacted to read:
1478 31A-16-108.6. Supervision of internationally active insurance groups.
1479 (1) (a) Except as otherwise provided in this section, the commissioner shall act as the
1480 group-wide supervisor for each internationally active insurance group.
1481 (b) In lieu of acting as the group-wide supervisor for an internationally active insurance
1482 company, the commissioner may acknowledge a regulatory official from another jurisdiction as
1483 the internationally active insurance group's group-wide supervisor, if:
1484 (i) the internationally active insurance group does not have substantial insurance
1485 operations in the United States;
1486 (ii) the internationally active insurance group does not have substantial insurance
1487 operations in the state; or
1488 (iii) in accordance with the provisions of this section, the commissioner determines
1489 that the regulatory official is an appropriate group-wide supervisor.
1490 (2) In deciding whether to acknowledge another regulatory official as an internationally
1491 active insurance group's group-wide supervisor in lieu of acting as the group-wide supervisor,
1492 the commissioner shall:
1493 (a) consult and cooperate with other state, federal, and international regulatory
1494 agencies; and
1495 (b) consider:
1496 (i) the domicile of the insurer or insurers within the internationally active insurance
1497 group that hold the largest share of the group's written premiums, assets, or liabilities;
1498 (ii) the domicile of the top-tiered insurer or insurers in the insurance holding company
1499 system of the internationally active insurance group;
1500 (iii) the location of the executive office or largest operational office of the
1501 internationally active insurance group;
1502 (iv) whether another regulatory official acts or seeks to act as the group-wide
1503 supervisor under a regulatory system that the commissioner determines to be:
1504 (A) substantially similar to the system of regulation provided under the laws of this
1505 state; or
1506 (B) sufficient in terms of providing for group-wide supervision, enterprise risk
1507 analysis, and cooperation with other regulatory officials; and
1508 (v) whether another regulatory official acting or seeking to act as the group-wide
1509 supervisor provides the commissioner with reasonably reciprocal recognition and cooperation.
1510 (3) (a) Before acting as the group-wide supervisor for an internationally active
1511 insurance group, the commissioner shall notify:
1512 (i) the insurer registered under Section 31A-16-105; and
1513 (ii) the ultimate controlling person within the internationally active insurance group.
1514 (b) Within 30 days after the day on which an internationally active insurance group
1515 receives a notification described in Subsection (3)(a), the internationally active insurance group
1516 may provide the commissioner additional information relevant to whether the commissioner
1517 should act as the internationally active insurance group's group-wide supervisor.
1518 (4) If the commissioner acts as the group-wide supervisor for an internationally active
1519 insurance group, the commissioner may later acknowledge a regulatory official from another
1520 jurisdiction as the group-wide supervisor for the internationally active insurance group if the
1521 commissioner:
1522 (a) considers the factors described in Subsection (2)(b);
1523 (b) cooperates with other regulatory officials involved with the supervision of the
1524 members of the internationally active insurance group; and
1525 (c) consults with the internationally active insurance group.
1526 (5) Notwithstanding any other provision of law, when a regulatory official from
1527 another jurisdiction is acting as the group-wide supervisor for an internationally active
1528 insurance group, the commissioner shall:
1529 (a) acknowledge the regulatory official as the group-wide supervisor; and
1530 (b) in accordance with Subsection (2), reevaluate whether it is appropriate to
1531 acknowledge a regulatory official from another jurisdiction as the group-wide supervisor if a
1532 change in circumstances results in:
1533 (i) the insurer or insurers within the internationally active insurance group that hold the
1534 largest share of the group's written premiums, assets, or liabilities being domiciled in the state;
1535 or
1536 (ii) the top-tiered insurer or insurers in the insurance holding company system of the
1537 internationally active insurance group being domiciled in the state.
1538 (6) In accordance with Section 31A-16-107.5, upon request from the commissioner, an
1539 insurer subject to this chapter shall provide the commissioner any information necessary to
1540 determine the appropriate group-wide supervisor for an internationally active insurance group.
1541 (7) The commissioner shall publish on the department's website the identity of each
1542 internationally active insurance group for which the commissioner acts as the group-wide
1543 supervisor.
1544 (8) If the commissioner is the group-wide supervisor of an internationally active
1545 insurance group, the commissioner may:
1546 (a) assess the enterprise risks within the internationally active insurance group to
1547 ensure that:
1548 (i) management of the internationally active insurance group identifies the material
1549 financial condition and liquidity risks to the members of the internationally active insurance
1550 group that are engaged in the business of insurance; and
1551 (ii) reasonable and effective mitigation measures are in place;
1552 (b) request, from any member of the internationally active insurance group,
1553 information necessary and appropriate to assess enterprise risk, including information about the
1554 members of the internationally active insurance group regarding:
1555 (i) governance, risk assessment, and management;
1556 (ii) capital adequacy; or
1557 (iii) material intercompany transactions;
1558 (c) coordinate and, through the authority of the regulatory officials of the jurisdictions
1559 where members of the internationally active insurance group are domiciled, compel
1560 development and implementation of reasonable measures designed to ensure that the
1561 internationally active insurance group is able to timely recognize and mitigate enterprise risks
1562 to members of the internationally active insurance group that are engaged in the business of
1563 insurance;
1564 (d) communicate with other state, federal, and international regulatory agencies for
1565 members within the internationally active insurance group;
1566 (e) subject to the confidentiality provisions of Section 31A-16-109, share relevant
1567 information:
1568 (i) through a supervisory college in accordance with Section 31A-16-108.5; or
1569 (ii) by entering into an agreement or obtaining documentation:
1570 (A) with or from an insurer registered under Section 31A-16-105, a member of the
1571 internationally active insurance group, or a state, federal or international regulatory agency for
1572 members of the internationally active insurance group; and
1573 (B) that provides the basis for or otherwise clarifies the commissioner's role as
1574 group-wide supervisor, including a provision for resolving disputes with another regulatory
1575 official; and
1576 (f) engage in any other group-wide supervision activity, consistent with an authority
1577 and purpose enumerated in this section, as the commissioner determines necessary.
1578 (9) An agreement or documentation described in Subsection (8)(e) may not serve as
1579 evidence in any proceeding that an insurer or person within an insurance holding company
1580 system not domiciled or incorporated in the state:
1581 (a) is doing business in the state; or
1582 (b) is subject to jurisdiction in the state.
1583 (10) (a) If the commissioner acknowledges as a group-wide supervisor another
1584 regulatory official from a jurisdiction that the NAIC does not accredit as a group-wide
1585 supervisor, the commissioner may reasonably cooperate, through supervisory colleges or
1586 otherwise, the group-wide supervisor, provided that:
1587 (i) the commissioner's cooperation is in compliance with the laws of this state; and
1588 (ii) the group-wide supervisor also recognizes and cooperates with the commissioner's
1589 activities as the group-wide supervisor for other internationally active insurance groups where
1590 applicable.
1591 (b) Where the recognition and cooperation described in Subsection (10)(a)(ii) is not
1592 reasonably reciprocal, the commissioner may refuse recognition and cooperation.
1593 (11) The commissioner may in accordance with Title 63G, Chapter 3, Utah
1594 Administrative Rulemaking Act, make rules necessary for the administration of this section.
1595 (12) An insurer subject to this section is liable for and shall pay the reasonable
1596 expenses of the commissioner's participation in the administration of this section, including:
1597 (a) the engagement of an attorney, actuary, or other professional; and
1598 (b) all reasonable travel expenses.
1599 Section 4. Section 31A-16-109 is amended to read:
1600 31A-16-109. Confidentiality of information obtained by commissioner.
1601 (1) (a) [
1602 information obtained by or disclosed to the commissioner or any other person in the course of
1603 an examination or investigation made under Section 31A-16-107.5, and all information
1604 reported or provided to the department under Section 31A-16-105 or 31A-16-108.6, is
1605 confidential. [
1606 (b) Any confidential document, material, or information described in Subsection (1)(a)
1607 is not subject to subpoena and may not be made public by the commissioner or any other
1608 person without the permission of the insurer, except [
1609 information may be provided to the insurance departments of other states, without the prior
1610 written consent of the insurer to which [
1611 pertains.
1612 (2) The commissioner and any person who [
1613 other information while acting under the authority of the commissioner or with whom the
1614 documents, materials, or other information are shared pursuant to this chapter shall keep
1615 confidential any confidential documents, materials, or information subject to Subsection (1).
1616 (3) (a) To assist in the performance of the commissioner's duties, the commissioner:
1617 (i) may share documents, materials, or other information, including the confidential
1618 documents, materials, or information subject to Subsection (1), with the following if the
1619 recipient agrees in writing to maintain the confidentiality status of the document, material, or
1620 other information, and has verified in writing the legal authority to maintain confidentiality:
1621 (A) [
1622 (B) the National Association of Insurance Commissioners [
1623
1624 (C) a state, federal, [
1625 including [
1626 (ii) notwithstanding Subsection (1), may only share confidential documents, material,
1627 or information reported pursuant to Section 31A-16-105 or 31A-16-108.6 with [
1628
1629 Subsection (1) and who [
1630 information;
1631 (iii) may receive documents, materials, or information, including otherwise
1632 confidential documents, materials, or information from:
1633 (A) the National Association of Insurance Commissioners [
1634
1635 (B) a regulatory [
1636 domestic [
1637 (iv) shall maintain as confidential any document, material, or information received
1638 under this section with notice or the understanding that it is confidential under the laws of the
1639 jurisdiction that is the source of the document, material, or information; and
1640 [
1641 Commissioners governing sharing and use of information provided pursuant to this chapter
1642 consistent with this Subsection (3) that shall:
1643 (A) specify procedures and protocols regarding the confidentiality and security of
1644 information shared with the National Association of Insurance Commissioners and [
1645 affiliates and subsidiaries pursuant to this chapter, including procedures and protocols for
1646 sharing by the National Association of Insurance Commissioners with other state, federal, or
1647 international regulators;
1648 (B) specify that ownership of information shared with the National Association of
1649 Insurance Commissioners and [
1650 remains with the commissioner and the National Association of Insurance Commissioner's use
1651 of the information is subject to the direction of the commissioner;
1652 (C) require prompt notice to be given to an insurer whose confidential information in
1653 the possession of the National Association of Insurance Commissioners pursuant to this chapter
1654 is subject to a request or subpoena to the National Association of Insurance Commissioners for
1655 disclosure or production; and
1656 (D) require the National Association of Insurance Commissioners and [
1657 affiliates and subsidiaries to consent to intervention by an insurer in any judicial or
1658 administrative action in which the National Association of Insurance Commissioners and [
1659 NAIC affiliates and subsidiaries may be required to disclose confidential information about the
1660 insurer shared with the National Association of Insurance Commissioners and [
1661 affiliates and subsidiaries pursuant to this chapter.
1662 (4) The sharing of information by the commissioner pursuant to this chapter does not
1663 constitute a delegation of regulatory authority or rulemaking, and the commissioner is solely
1664 responsible for the administration, execution, and enforcement of this chapter.
1665 (5) A waiver of any applicable claim of confidentiality in the documents, materials, or
1666 information does not occur as a result of disclosure to the commissioner under this section or
1667 as a result of sharing as authorized in Subsection (3).
1668 (6) Documents, materials, or other information in the possession or control of the
1669 National Association of Insurance Commissioners pursuant to this chapter are:
1670 (a) confidential, not public records, and not open to public inspection; and
1671 (b) not subject to Title 63G, Chapter 2, Government Records Access and Management
1672 Act.
1673 Section 5. Section 31A-16b-101 is enacted to read:
1674
1675 31A-16b-101. Title.
1676 This chapter is known as the "Corporate Governance Annual Disclosure Act."
1677 Section 6. Section 31A-16b-102 is enacted to read:
1678 31A-16b-102. Administration and scope.
1679 (1) The commissioner is solely responsible for the administration and enforcement of
1680 the provisions of this chapter.
1681 (2) This chapter does not:
1682 (a) prescribe or impose corporate governance standards or internal procedures beyond
1683 what is required under applicable state corporate law; or
1684 (b) limit the commissioner's authority, or the rights or obligations of third parties,
1685 under Chapter 2, Administration of the Insurance Laws.
1686 (3) The requirements of this Chapter apply to each insurer domiciled in the state.
1687 Section 7. Section 31A-16b-103 is enacted to read:
1688 31A-16b-103. Disclosure requirement.
1689 (1) An insurer, or the insurance group of which the insurer is a member, shall on or
1690 before June 1 of each year submit to the commissioner a corporate governance annual
1691 disclosure that contains the information required under Section 31A-16b-105.
1692 (2) Notwithstanding a request from the commissioner described in Subsection (4), if an
1693 insurer is a member of an insurance group, the insurer shall submit the report required under
1694 this section to the commissioner of the lead state for the insurance group in accordance with:
1695 (a) the laws of the lead state; and
1696 (b) the procedures outlined in the most recent Financial Analysis Handbook adopted by
1697 the NAIC.
1698 (3) The corporate governance annual disclosure described in Subsection (1) shall
1699 include a signature:
1700 (a) of the insurer's or insurance group's chief executive officer or corporate secretary;
1701 and
1702 (b) attesting to the best of the signatory's belief and knowledge that:
1703 (i) the insurer or insurance group has implemented the corporate governance practices;
1704 and
1705 (ii) a copy of the disclosure has been provided to the insurer's or insurance group's
1706 board of directors or the appropriate committee thereof.
1707 (4) An insurer not required to submit a corporate governance annual disclosure under
1708 this section shall submit a corporate governance annual disclosure to the commissioner upon
1709 the commissioner's request.
1710 (5) (a) For purposes of completing a corporate governance annual disclosure, an insurer
1711 or insurance group may provide information regarding corporate governance at one of the
1712 following levels:
1713 (i) at the ultimate controlling parent level;
1714 (ii) at an intermediate holding company level; or
1715 (iii) at the individual legal entity level.
1716 (b) An insurer or insurance group shall consider making each corporate governance
1717 annual disclosure at the level at which the insurer or insurance group:
1718 (i) determines the insurer or insurance group's risk appetite;
1719 (ii) (A) collectively oversees the earnings, capital, liquidity, operations, and reputation
1720 of the insurer; and
1721 (B) coordinates and exercises the supervision of earnings, capital, liquidity, operations,
1722 and reputation of the insurer; or
1723 (iii) places legal liability for failure of general corporate governance duties.
1724 (6) If an insurer or insurance group chooses a level of reporting described in
1725 Subsection (5), it shall indicate:
1726 (a) which of the three levels the insurer or insurance group chose; and
1727 (b) explain any subsequent change in the level of reporting.
1728 (7) An insurer may choose not to include certain information in a corporate governance
1729 annual disclosure, if:
1730 (a) the information is substantially similar to information included in another document
1731 submitted to the commissioner, including a proxy statement filed in conjunction with Section
1732 31A-16-105 or another state or federal filing provided to the department; and
1733 (b) the insurer cross references the document described in Subsection (7)(a) in the
1734 corporate governance annual disclosure.
1735 Section 8. Section 31A-16b-104 is enacted to read:
1736 31A-16b-104. Rulemaking.
1737 (1) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1738 commissioner may make rules to implement and administer this chapter.
1739 (2) The commissioner may issue orders as is necessary to carry out this chapter.
1740 Section 9. Section 31A-16b-105 is enacted to read:
1741 31A-16b-105. Contents of corporate governance annual disclosure.
1742 (1) A corporate governance annual disclosure shall include information sufficient to
1743 provide the commissioner a clear understanding of the insurer's or insurance group's:
1744 (a) corporate governance policies;
1745 (b) reporting or information systems; and
1746 (c) controls implementing a policy or system described in this Subsection (1).
1747 (2) After receiving a corporate governance annual disclosure, the commissioner may
1748 request additional information from the insurer or insurance group that the commissioner
1749 considers material and necessary to understanding the items described in Subsection (1).
1750 (3) An insurer or insurance group shall maintain and make available upon request of
1751 the commissioner:
1752 (a) documentation; or
1753 (b) supporting information.
1754 Section 10. Section 31A-16b-106 is enacted to read:
1755 31A-16b-106. Confidentiality.
1756 (1) A document, material, or other information is considered proprietary and to contain
1757 a trade secret if the document, material, or other information is:
1758 (a) in the control or possession of the department; and
1759 (b) obtained by, created by, or disclosed in accordance with this chapter.
1760 (2) A document, material, or other information described in Subsection (1) is:
1761 (a) confidential and privileged;
1762 (b) classified as a protected record under Title 63G, Chapter 2, Government Records
1763 Access and Management Act;
1764 (c) not subject to:
1765 (i) subpoena; or
1766 (ii) discovery; and
1767 (d) not admissible as evidence in any private civil action.
1768 (3) (a) The commissioner may use a document, material, or other information
1769 described in Subsection (1) in the furtherance of a regulatory or legal action brought as a part of
1770 the commissioner's duties.
1771 (b) Except as described in Subsection (3)(a), the commissioner may not make a
1772 document, material, or other information described in Subsection (1) public without the prior
1773 written consent of the insurer or insurance group.
1774 (4) Nothing in this section requires written consent of the insurer or insurance group
1775 before the commissioner shares or receives, in accordance with Subsection (6), a document,
1776 material, or other information described in Subsection (1) to assist in the performance of the
1777 commissioner's duties.
1778 (5) The following may not testify in any private civil action regarding a document,
1779 material, or other information described in Subsection (1):
1780 (a) the commissioner; or
1781 (b) a person:
1782 (i) who receives the document, material, or other information, through examination or
1783 otherwise, while acting under the authority of the commissioner; or
1784 (ii) with whom the document, material, or other information is shared in accordance
1785 with this chapter.
1786 (6) To carry out the commissioner's duties, the commissioner may:
1787 (a) upon request, share a document, material, or other information described in
1788 Subsection (1) with:
1789 (i) a state, federal, or international financial regulatory agency, including a member of a
1790 supervisory college as defined in Section 31A-16-108.5; or
1791 (ii) the NAIC or a third-party consultant retained in accordance with Section
1792 31A-16b-107, if the recipient:
1793 (A) agrees in writing to maintain the confidentiality and privileged status of the
1794 document, material, or other information; and
1795 (B) verifies in writing the legal authority to maintain confidentiality; or
1796 (b) receive documents, materials, or other information related to a corporate
1797 governance annual disclosure, including:
1798 (i) otherwise confidential and privileged documents, materials, or other information;
1799 and
1800 (ii) proprietary and trade secret information or documents from:
1801 (A) a regulatory official of a state, federal, or international financial regulatory agency,
1802 including a member of a supervisory college as defined in Section 31A-16-108.5; or
1803 (B) the NAIC.
1804 (7) A written agreement to share a document, material, or other information described
1805 in Subsection (1) with the NAIC or a third-party consultant shall contain the following:
1806 (a) specific procedures and protocols for maintaining the confidentiality and privileged
1807 status of the document, material, or other information in accordance with this chapter;
1808 (b) procedures and protocols ensuring the NAIC shares information only with a state
1809 regulator from a state in which the insurance group has a domiciled insurer;
1810 (c) verification that the recipient has legal authority to maintain the confidentiality and
1811 privileged status of the document, material, or other information;
1812 (d) a provision specifying that:
1813 (i) ownership of the document, material, or other information remains with the
1814 department; and
1815 (ii) the NAIC's or third-party consultant's use of the document, material, or other
1816 information shared with the NAIC or third-party consultant is subject to the direction of the
1817 commissioner;
1818 (e) a provision prohibiting the NAIC or third-party consultant from storing the
1819 document, material, or other information in a permanent database after the underlying analysis
1820 is complete;
1821 (f) a provision requiring the NAIC or third-party consultant to provide prompt notice to
1822 the commissioner and to the insurer or insurance group regarding any subpoena, request for
1823 disclosure, or request for production of the document, material, or other information;
1824 (g) a provision requiring the NAIC or third-party consultant consent to the insurer or
1825 insurance group intervening in any judicial or administrative action in which the NAIC or
1826 third-party consultant may be required to disclose the document, material, or other information;
1827 and
1828 (h) a provision requiring the written consent of the insurer or insurance group before
1829 making public the document, material, or other information.
1830 (8) The commissioner shall maintain as confidential or privileged any documents,
1831 materials, or other information received with notice or with the understanding that it is
1832 confidential or privileged under the laws of the jurisdiction that is the source of the document,
1833 material, or other information.
1834 (9) The sharing of a document, material, or other information by the commissioner in
1835 accordance with this chapter is not a delegation of regulatory authority or rulemaking.
1836 (10) Disclosing or sharing a document, material, or other information in accordance
1837 with this chapter does not waive any privilege or claim of confidentiality related to the
1838 document, material, or other information.
1839 Section 11. Section 31A-16b-107 is enacted to read:
1840 31A-16b-107. Third-party consultants.
1841 (1) The commissioner may retain a third-party consultant, including an attorney,
1842 actuary, accountant, or other expert not otherwise a part of the commissioner's staff:
1843 (a) at the insurer's or insurance group's expense; and
1844 (b) as is reasonably necessary to assist the commissioner in reviewing the insurer's or
1845 insurance group's:
1846 (i) corporate governance annual disclosure and related information; or
1847 (ii) compliance with this chapter.
1848 (2) A person the commissioner retains under Subsection (1):
1849 (a) is under the direction and control of the commissioner; and
1850 (b) shall act in a purely advisory capacity.
1851 (3) A third-party consultant is subject to the same confidentiality standards and
1852 requirements as the commissioner.
1853 (4) As part of the retention process, a third-party consultant shall verify to the
1854 commissioner, with notice to the insurer or insurance group, that the third-party consultant:
1855 (a) is free of a conflict of interest; and
1856 (b) has internal procedures in place to:
1857 (i) monitor compliance with Subsection (4)(a); and
1858 (ii) comply with the confidentiality standards and requirements of this chapter.
1859 Section 12. Section 31A-16b-108 is enacted to read:
1860 31A-16b-108. Penalties.
1861 (1) An insurer or insurance group that, without just cause, fails to timely file a
1862 corporate governance annual disclosure as required in this chapter shall, after notice and
1863 hearing, pay a penalty of $10,000 for each day's delay, up to $300,000.
1864 (2) Any penalty recovered by the commissioner under this section shall be deposited
1865 into the General Fund.
1866 (3) The commissioner may reduce a penalty under this section if the insurer or
1867 insurance group demonstrates to the commissioner that the imposition of the penalty would
1868 constitute a financial hardship to the insurer.
1869 Section 13. Section 31A-17-519 is amended to read:
1870 31A-17-519. Small company exemption.
1871 (1) A company that is licensed and doing business in Utah, and whose reserves are
1872 computed subject to the requirements of Subsection 31A-17-502(2), in lieu of the reserves
1873 required under Sections 31A-17-514 and 31A-17-515, may hold reserves for ordinary life
1874 insurance policies issued directly, or assumed, during the current calendar year, based on the
1875 mortality tables and interest rates defined by the valuation manual for net premium reserves
1876 and using the methodology defined in Sections 31A-17-507 through 31A-17-512 as they apply
1877 to ordinary life insurance [
1878
1879 (a) the company has less than $300,000,000 of ordinary life premium;
1880 (b) if the company is a member of a group of life insurers, the group has combined
1881 ordinary life premiums of less than $600,000,000;
1882 [
1883
1884 [
1885 accordance with Subsection 31A-17-503(2) for the prior calendar year;
1886 [
1887 universal life policy with a secondary guarantee issued on or after [
1888
1889 for the current calendar year-end valuation date, only has secondary guarantees that meets the
1890 definition of a [
1891 defined in the valuation manual;
1892 [
1893 Subsection 31A-17-502(2) is required a statement with its domiciliary commissioner certifying
1894 that these conditions are met and that the company intends to calculate reserves as described in
1895 this section; and
1896 [
1897 writing before September 1 of the calendar year for which valuation under Subsection
1898 31A-17-502(2) is required that the company must comply with the valuation manual
1899 requirements for life insurance reserves.
1900 (2) For purposes of Subsections (1)(a) and (b), ordinary life premiums are measured as
1901 direct premium plus reinsurance assumed from an unaffiliated company, as reported in the
1902 prior calendar year annual statement, excluding premiums for guaranteed issue policies and
1903 pre-need life contracts and excluding amounts that represent the transfer of reserves in-force as
1904 of the effective date of a reinsurance assumed transaction.
1905 Section 14. Section 31A-21-201 is amended to read:
1906 31A-21-201. Filing of forms.
1907 (1) (a) Except as exempted under Subsections 31A-21-101(2) through (6), a form may
1908 not be used, sold, or offered for sale until the form is filed with the commissioner.
1909 (b) A form is considered filed with the commissioner when the commissioner receives:
1910 (i) the form;
1911 (ii) the applicable filing fee as prescribed under Section 31A-3-103; and
1912 (iii) the applicable transmittal forms as required by the commissioner.
1913 (2) In filing a form for use in this state the insurer is responsible for assuring that the
1914 form is in compliance with this title and rules adopted by the commissioner.
1915 (3) (a) The commissioner may prohibit the use of a form at any time upon a finding
1916 that:
1917 (i) the form:
1918 (A) is inequitable;
1919 (B) is unfairly discriminatory;
1920 (C) is misleading;
1921 (D) is deceptive;
1922 (E) is obscure;
1923 (F) is unfair;
1924 (G) encourages misrepresentation; or
1925 (H) is not in the public interest;
1926 (ii) the form provides benefits or contains another provision that endangers the solidity
1927 of the insurer;
1928 (iii) except an application required by Section 31A-22-635, the form is an insurance
1929 policy or application for an insurance policy that fails to conspicuously, as defined by rule,
1930 provide:
1931 (A) the exact name of the insurer;
1932 (B) the state of domicile of the insurer filing the insurance policy or application for the
1933 insurance policy; and
1934 (C) for a life insurance and annuity insurance policy only, the address of the
1935 administrative office of the insurer filing the insurance policy or application for the insurance
1936 policy;
1937 (iv) the form violates a statute or a rule adopted by the commissioner; or
1938 (v) the form is otherwise contrary to law.
1939 [
1940 [
1941 the commissioner may order that, on or before a date not less than 15 days after the order, the
1942 use of the form be discontinued.
1943 (ii) Once use of a form is prohibited, the form may not be used until appropriate
1944 changes are filed with and reviewed by the commissioner.
1945 (iii) When the commissioner prohibits the use of a form under Subsection (3)(a), the
1946 commissioner may require the insurer to disclose contract deficiencies to the existing
1947 policyholders.
1948 [
1949 prohibition shall:
1950 (i) be in writing;
1951 (ii) constitute an order; and
1952 (iii) state the reasons for the prohibition.
1953 (4) (a) If, after a hearing, the commissioner determines that it is in the public interest,
1954 the commissioner may require by rule or order that a form be subject to the commissioner's
1955 approval before its use.
1956 (b) The rule or order described in Subsection (4)(a) shall prescribe the filing
1957 procedures for a form if the procedures are different from the procedures stated in this section.
1958 (c) The type of form that under Subsection (4)(a) the commissioner may require
1959 approval of before use includes:
1960 (i) a form for a particular class of insurance;
1961 (ii) a form for a specific line of insurance;
1962 (iii) a specific type of form; or
1963 (iv) a form for a specific market segment.
1964 (5) (a) An insurer shall maintain a complete and accurate record of the following for
1965 the time period described in Subsection (5)(b):
1966 (i) a form:
1967 (A) filed under this section for use; or
1968 (B) that is in use; and
1969 (ii) a document filed under this section with a form described in Subsection (5)(a)(i).
1970 (b) The insurer shall maintain a record required under Subsection (5)(a) for the balance
1971 of the current year, plus five years from:
1972 (i) the last day on which the form is used; or
1973 (ii) the last day an insurance policy that is issued using the form is in effect.
1974 Section 15. Section 31A-21-311 is amended to read:
1975 31A-21-311. Delivery of policy or certificate.
1976 (1) (a) An insurer issuing an individual or group life insurance policy or an accident
1977 and health insurance policy shall deliver a copy of the policy to the policyholder as soon as
1978 practicable but no later than 90 days after the day on which the coverage is effective.
1979 (b) The policy described in this Subsection (1) shall:
1980 (i) provide the exact name of the insurer; and
1981 (ii) state the state of domicile of the insurer.
1982 [
1983 insurance policy other than a blanket insurance policy shall, as soon as practicable after the
1984 coverage is effective, but no later than 90 days after the day on which the coverage is effective,
1985 provide a certificate for each member of the insured group, except that only one certificate need
1986 be provided for the members of a family unit.
1987 (ii) The certificate [
1988 (A) provide the exact name of the insurer;
1989 (B) state the state of domicile of the insurer; and
1990 (C) contain a summary of the essential features of the insurance coverage, including:
1991 (I) any rights of conversion to an individual policy;
1992 (II) in the case of group life insurance, any continuation of coverage during total
1993 disability; and
1994 (III) in the case of group life insurance, the incontestability provision.
1995 (iii) Upon receiving a written request, the insurer shall inform any insured how the
1996 insured may inspect, during normal business hours at a place reasonably convenient to the
1997 insured:
1998 (A) a copy of the policy; or
1999 (B) a summary of the policy containing all the details that are relevant to the certificate
2000 holder.
2001 (b) The commissioner may by rule impose a requirement similar to Subsection [
2002 (2)(a) on any class of blanket insurance policies for which the commissioner finds that the
2003 group of persons covered is constant enough for that type of action to be practicable and not
2004 unreasonably expensive.
2005 (c) (i) A certificate shall be provided in a manner reasonably calculated to bring the
2006 certificate to the attention of the certificate holder.
2007 (ii) The insurer may deliver or mail a certificate:
2008 (A) directly to the certificate holders; or
2009 (B) in bulk to the policyholder to transmit to certificate holders.
2010 (iii) An affidavit by the insurer that the insurer mailed the certificates in the usual
2011 course of business creates a rebuttable presumption that the insurer has mailed the certificate
2012 to:
2013 (A) a certificate holder; or
2014 (B) a policyholder as provided in Subsection [
2015 (d) The commissioner may by rule or order prescribe substitutes for delivery or mailing
2016 of certificates that are reasonably calculated to inform a certificate holder of the certificate
2017 holder's rights, including:
2018 (i) booklets describing the coverage;
2019 (ii) the posting of notices in the place of business; or
2020 (iii) publication in a house organ.
2021 [
2022 to the policyholder or certificate holder, as applicable, when required by this section, an act or
2023 omission forbidden to or required of the policyholder or certificate holder by the policy or
2024 certificate after the coverage has become effective as to the policyholder or certificate holder,
2025 other than intentionally causing the loss insured against or failing to make required
2026 contributory premium payments, may not affect the insurer's obligations under the insurance
2027 contract.
2028 Section 16. Section 31A-21-313 is amended to read:
2029 31A-21-313. Limitation of actions.
2030 (1) (a) An action on a written policy or contract of first party insurance shall be
2031 commenced within three years after the inception of the loss.
2032 (b) The inception of the loss on a fidelity bond is the date the insurer first denies all or
2033 part of a claim made under the fidelity bond.
2034 (2) Except as provided in Subsection (1) or elsewhere in this title, the law applicable to
2035 limitation of actions in Title 78B, Chapter 2, Statutes of Limitations, applies to actions on
2036 insurance policies.
2037 (3) An insurance policy may not:
2038 (a) limit the time for beginning an action on the policy to a time less than that
2039 authorized by statute;
2040 (b) prescribe in what court an action may be brought on the policy; or
2041 (c) provide that no action may be brought, subject to permissible arbitration provisions
2042 in contracts.
2043 (4) Unless by verified complaint it is alleged that prejudice to the complainant will
2044 arise from a delay in bringing suit against an insurer, which prejudice is other than the delay
2045 itself, no action may be brought against an insurer on an insurance policy to compel payment
2046 under the policy until the earlier of:
2047 (a) 60 days after proof of loss has been furnished as required under the policy;
2048 (b) waiver by the insurer of proof of loss; or
2049 (c) the insurer's denial of [
2050 (5) The period of limitation is tolled during the period in which the parties conduct an
2051 appraisal or arbitration procedure prescribed by the insurance policy, by law, or as agreed to by
2052 the parties.
2053 Section 17. Section 31A-22-501 is amended to read:
2054 31A-22-501. Eligible groups.
2055 A group or blanket policy of life insurance may not be delivered in Utah unless the
2056 insured group:
2057 (1) falls within at least one of the classifications under Sections 31A-22-501.1 through
2058 31A-22-509; and
2059 (2) is formed [
2060 good faith for purposes other than obtaining insurance.
2061 Section 18. Section 31A-22-605.1 is amended to read:
2062 31A-22-605.1. Preexisting condition limitations.
2063 (1) Any provision dealing with preexisting conditions shall be consistent with this
2064 section, Section 31A-22-609, and rules adopted by the commissioner.
2065 (2) Except as provided in this section, an insurer that elects to use an application form
2066 without questions concerning the insured's health or medical treatment history shall provide
2067 coverage under the policy for any loss which occurs more than 12 months after the effective
2068 date of coverage due to a preexisting condition which is not specifically excluded from
2069 coverage.
2070 (3) (a) An insurer that issues a specified disease policy may not deny a claim for loss
2071 due to a preexisting condition that occurs more than six months after the effective date of
2072 coverage.
2073 (b) A specified disease policy may impose a preexisting condition exclusion only if the
2074 exclusion relates to a preexisting condition which first manifested itself within six months prior
2075 to the effective date of coverage or which was diagnosed by a physician at any time prior to the
2076 effective date of coverage.
2077 (4) (a) Except as [
2078 health benefit plan may impose a preexisting condition exclusion only if:
2079 (i) the exclusion relates to a preexisting condition for which medical advice, diagnosis,
2080 care, or treatment was recommended or received within the six-month period ending on the
2081 enrollment date from an individual licensed or similarly authorized to provide those services
2082 under state law and operating within the scope of practice authorized by state law;
2083 (ii) the exclusion period ends no later than 12 months after the enrollment date, or in
2084 the case of a late enrollee, 18 months after the enrollment date; and
2085 (iii) the exclusion period is reduced by the number of days of creditable coverage the
2086 enrollee has as of the enrollment date, in accordance with Subsection (4)(b).
2087 (b) (i) The amount of creditable coverage allowed under Subsection (4)(a)(iii) is
2088 determined by counting all the days on which the individual has one or more types of creditable
2089 coverage.
2090 (ii) Days of creditable coverage that occur before a significant break in coverage are
2091 not required to be counted.
2092 (A) Days in a waiting period or affiliation period are not taken into account in
2093 determining whether a significant break in coverage has occurred.
2094 (B) For an individual who elects federal COBRA continuation coverage during the
2095 second election period provided under the federal Trade Act of 2002, the days between the date
2096 the individual lost group health plan coverage and the first day of the second COBRA election
2097 period are not taken into account in determining whether a significant break in coverage has
2098 occurred.
2099 (c) A group health benefit plan may not impose a preexisting condition exclusion
2100 relating to pregnancy.
2101 (d) (i) An insurer imposing a preexisting condition exclusion shall provide a written
2102 general notice of preexisting condition exclusion as part of any written application materials.
2103 (ii) The general notice under this subsection shall include:
2104 (A) a description of the existence and terms of any preexisting condition exclusion
2105 under the plan, including the six-month period ending on the enrollment date, the maximum
2106 preexisting condition exclusion period, and how the insurer will reduce the maximum
2107 preexisting condition exclusion period by creditable coverage;
2108 (B) a description of the rights of individuals:
2109 (I) to demonstrate creditable coverage, including any applicable waiting periods,
2110 through a certificate of creditable coverage or through other means; and
2111 (II) to request a certificate of creditable coverage from a prior plan;
2112 (C) a statement that the current plan will assist in obtaining a certificate of creditable
2113 coverage from any prior plan or issuer if necessary; and
2114 (D) a person to contact, and an address and telephone number for the person, for
2115 obtaining additional information or assistance regarding the preexisting condition exclusion.
2116 (e) An insurer may not impose any limit on the amount of time that an individual has to
2117 present a certificate or other evidence of creditable coverage.
2118 (f) This Subsection (4) does not preclude application of any waiting period applicable
2119 to all new enrollees under the plan.
2120 (5) (a) If a short-term limited duration health insurance policy provides for an
2121 extension or renewal of the policy, the insurer may not exclude coverage for a loss due to a
2122 preexisting condition for a period greater than 12 months following the original effective date
2123 of the policy, unless the insurer specifically and expressly excludes the preexisting condition in
2124 the terms of the policy or certificate.
2125 (b) (i) An insurer that includes a preexisting condition exclusion in a short-term limited
2126 duration health insurance policy in accordance with this subsection shall provide a written
2127 general notice of the preexisting condition exclusion as part of any written application
2128 materials.
2129 (ii) A written general notice described in this subsection shall:
2130 (A) include a description of the existence and terms of any preexisting condition
2131 exclusion under the policy, including the maximum preexisting exclusion period; and
2132 (B) state that the exclusion period ends no later than 12 months after the original
2133 effective date of the policy.
2134 Section 19. Section 31A-22-611 is amended to read:
2135 31A-22-611. Coverage for children with a disability.
2136 (1) For the purposes of this section:
2137 (a) "Dependent with a disability" means a child who is and continues to be both:
2138 (i) unable to engage in substantial gainful employment to the degree that the child can
2139 achieve economic independence due to a medically determinable physical or mental
2140 impairment which can be expected to result in death, or which has lasted or can be expected to
2141 last for a continuous period of not less than 12 months; and
2142 (ii) chiefly dependent upon an insured for support and maintenance since the child
2143 reached the age specified in Subsection 31A-22-610.5(2).
2144 (b) "Mental impairment" means a mental or psychological disorder such as:
2145 (i) an intellectual disability;
2146 (ii) organic brain syndrome;
2147 (iii) emotional or mental illness; or
2148 (iv) specific learning disabilities as determined by the insurer.
2149 (c) "Physical impairment" means a physiological disorder, condition, or disfigurement,
2150 or anatomical loss affecting one or more of the following body systems:
2151 (i) neurological;
2152 (ii) musculoskeletal;
2153 (iii) special sense organs;
2154 (iv) respiratory organs;
2155 (v) speech organs;
2156 (vi) cardiovascular;
2157 (vii) reproductive;
2158 (viii) digestive;
2159 (ix) genito-urinary;
2160 (x) hemic and lymphatic;
2161 (xi) skin; or
2162 (xii) endocrine.
2163 (2) The insurer may require proof of the [
2164 furnished by the person insured under the policy within 30 days of the effective date or the date
2165 the child attains the age specified in Subsection 31A-22-610.5(2), and at any time thereafter,
2166 except that the insurer may not require proof more often than annually after the two-year period
2167 immediately following attainment of the limiting age by the dependent with a disability.
2168 (3) Any individual or group accident and health insurance policy or health maintenance
2169 organization contract that provides coverage for a policyholder's or certificate holder's
2170 dependent shall, upon application, provide coverage for all unmarried dependents with a
2171 disability who have been continuously covered, with no break of more than 63 days, under any
2172 accident and health insurance since the age specified in Subsection 31A-22-610.5(2).
2173 (4) Every accident and health insurance policy or contract that provides coverage of a
2174 dependent with a disability may not terminate the policy due to an age limitation.
2175 Section 20. Section 31A-22-627 is amended to read:
2176 31A-22-627. Coverage of emergency medical services.
2177 (1) A health insurance policy or managed care organization contract:
2178 (a) shall provide, at a minimum, coverage of emergency services as required in 29
2179 C.F.R. Sec. 2590.715-2719A; and
2180 (b) may not:
2181 (i) require any form of preauthorization for treatment of an emergency medical
2182 condition until after the insured's condition has been stabilized; or
2183 (ii) deny a claim for any covered evaluation, covered diagnostic test, or other covered
2184 treatment considered medically necessary to stabilize the emergency medical condition of an
2185 insured.
2186 (2) A health insurance policy or managed care organization contract may require
2187 authorization for the continued treatment of an emergency medical condition after the insured's
2188 condition has been stabilized. If such authorization is required, an insurer who does not accept
2189 or reject a request for authorization may not deny a claim for any evaluation, diagnostic testing,
2190 or other treatment considered medically necessary that occurred between the time the request
2191 was received and the time the insurer rejected the request for authorization.
2192 (3) For purposes of this section:
2193 (a) "Emergency medical condition" means a medical condition manifesting itself by
2194 acute symptoms of sufficient severity, including severe pain, such that a prudent layperson,
2195 who possesses an average knowledge of medicine and health, would reasonably expect the
2196 absence of immediate medical attention [
2197 in:
2198 (i) placing the insured's health, or with respect to a pregnant woman, the health of the
2199 woman or her unborn child, in serious jeopardy;
2200 (ii) serious impairment to bodily functions; or
2201 (iii) serious dysfunction of any bodily organ or part.
2202 (b) "Hospital emergency department" means that area of a hospital in which emergency
2203 services are provided on a 24-hour-a-day basis.
2204 (c) "Stabilize" means the same as that term is defined in 42 U.S.C. Sec. 1395dd(e)(3).
2205 (4) Nothing in this section may be construed as:
2206 (a) altering the level or type of benefits that are provided under the terms of a contract
2207 or policy; or
2208 (b) restricting a policy or contract from providing enhanced benefits for certain
2209 emergency medical conditions that are identified in the policy or contract.
2210 (5) Notwithstanding Section 31A-2-308, if the commissioner finds an insurer has
2211 violated this section, the commissioner may:
2212 (a) work with the insurer to improve the insurer's compliance with this section; or
2213 (b) impose the following fines:
2214 (i) not more than $5,000; or
2215 (ii) twice the amount of any profit gained from violations of this section.
2216 Section 21. Section 31A-22-638 is amended to read:
2217 31A-22-638. Coverage for prosthetic devices.
2218 (1) For purposes of this section:
2219 (a) "Orthotic device" means a rigid or semirigid device supporting a weak or deformed
2220 leg, foot, arm, hand, back, or neck, or restricting or eliminating motion in a diseased or injured
2221 leg, foot, arm, hand, back, or neck.
2222 (b) (i) "Prosthetic device" means an artificial limb device or appliance designed to
2223 replace in whole or in part an arm or a leg.
2224 (ii) "Prosthetic device" does not include an orthotic device.
2225 (2) (a) Beginning January 1, 2011, an insurer, other than an insurer described in
2226 Subsection (2)(b), that provides a health benefit plan shall offer at least one plan, in each
2227 market where the insurer offers a health benefit plan, that provides coverage for benefits for
2228 prosthetics that includes:
2229 (i) a prosthetic device;
2230 (ii) all services and supplies necessary for the effective use of a prosthetic device,
2231 including:
2232 (A) formulating its design;
2233 (B) fabrication;
2234 (C) material and component selection;
2235 (D) measurements and fittings;
2236 (E) static and dynamic alignments; and
2237 (F) instructing the patient in the use of the prosthetic device;
2238 (iii) all materials and components necessary to use the prosthetic device; and
2239 (iv) any repair or replacement of a prosthetic device that is determined medically
2240 necessary to restore or maintain the ability to complete activities of daily living or essential
2241 job-related activities and that is not solely for comfort or convenience.
2242 (b) Beginning January 1, 2011, an insurer that is subject to Title 49, Chapter 20, Public
2243 Employees' Benefit and Insurance Program Act, shall offer to a covered employer at least one
2244 plan that:
2245 (i) provides coverage for prosthetics that complies with Subsections (2)(a)(i) through
2246 (iv); and
2247 (ii) requires an employee who elects to purchase the coverage described in Subsection
2248 (2)(b)(i) to pay an increased premium to pay the costs of obtaining that coverage.
2249 (c) At least one of the plans with the prosthetic benefits described in Subsections (2)(a)
2250 and (b) that is offered by an insurer described in this Subsection (2) shall have a coinsurance
2251 rate, that applies to physical injury generally and to prosthetics, of 80% to be paid by the
2252 insurer and 20% to be paid by the insured, if the prosthetic benefit is obtained from a person
2253 that the insurer contracts with or approves.
2254 (d) For policies issued on or after July 1, 2010 until July 1, 2015, an insurer is exempt
2255 from the 30% index rating restrictions in Section 31A-30-106.1, and for the first year only that
2256 coverage under this section is chosen, the 15% annual adjustment restriction in Section
2257 31A-30-106.1, for any small employer with 20 or less enrolled employees who chooses
2258 coverage that meets or exceeds the coverage under this section.
2259 (3) The coverage described in this section:
2260 (a) shall, except as otherwise provided in this section, be made subject to cost-sharing
2261 provisions, including dollar limits, deductibles, copayments, and co-insurance, that are not less
2262 favorable to the insured than the cost-sharing provisions of the health benefit plan that apply to
2263 physical illness generally; and
2264 (b) may limit coverage for the purchase, repair, or replacement of a microprocessor
2265 component for a prosthetic device to $30,000, per limb, every three years.
2266 (4) If the coverage described in this section is provided through a managed care plan,
2267 offered under Chapter [
2268
2269 insured shall have access to medically necessary prosthetic clinical care, and to prosthetic
2270 devices and technology, from one or more prosthetic providers in the managed care plan's
2271 provider network.
2272 Section 22. Section 31A-22-701 is amended to read:
2273 31A-22-701. Groups eligible for group or blanket insurance.
2274 (1) As used in this section, "association group" means a lawfully formed association of
2275 individuals or business entities that:
2276 (a) purchases insurance on a group basis on behalf of members; and
2277 (b) is formed and maintained in good faith for purposes other than obtaining insurance.
2278 (2) A group accident and health insurance policy may be issued to:
2279 (a) a group:
2280 (i) to which a group life insurance policy may be issued under Section 31A-22-502,
2281 31A-22-503, 31A-22-504, 31A-22-506, or 31A-22-507; and
2282 (ii) that is formed and maintained in good faith for a purpose other than obtaining
2283 insurance;
2284 (b) an association group authorized by the commissioner that:
2285 (i) has been actively in existence for at least five years;
2286 (ii) has a constitution and bylaws;
2287 (iii) has a shared or common purpose that is not primarily a business or customer
2288 relationship;
2289 (iv) is formed and maintained in good faith for purposes other than obtaining
2290 insurance;
2291 (v) does not condition membership in the association group on any health status-related
2292 factor relating to an individual, including an employee of an employer or a dependent of an
2293 employee;
2294 (vi) makes accident and health insurance coverage offered through the association
2295 group available to all members regardless of any health status-related factor relating to the
2296 members or individuals eligible for coverage through a member;
2297 (vii) does not make accident and health insurance coverage offered through the
2298 association group available other than in connection with a member of the association group;
2299 and
2300 (viii) is actuarially sound; or
2301 (c) a group specifically authorized by the commissioner, upon a finding that:
2302 (i) authorization is not contrary to the public interest;
2303 (ii) the group is actuarially sound;
2304 (iii) formation of the proposed group may result in economies of scale in acquisition,
2305 administrative, marketing, and brokerage costs;
2306 (iv) the insurance policy, insurance certificate, or other indicia of coverage that will be
2307 offered to the proposed group is substantially equivalent to insurance policies that are
2308 otherwise available to similar groups;
2309 (v) the group would not present hazards of adverse selection;
2310 (vi) the premiums for the insurance policy and any contributions by or on behalf of the
2311 insured persons are reasonable in relation to the benefits provided; and
2312 (vii) the group is formed and maintained in good faith for a purpose other than
2313 obtaining insurance.
2314 (3) A blanket accident and health insurance policy:
2315 (a) covers a defined class of persons;
2316 (b) may not be offered or underwritten on an individual basis;
2317 (c) shall cover only a group that is:
2318 (i) actuarially sound; and
2319 (ii) formed and maintained in good faith for a purpose other than obtaining insurance;
2320 and
2321 (d) may be issued only to:
2322 (i) a common carrier or an operator, owner, or lessee of a means of transportation, as
2323 policyholder, covering persons who may become passengers as defined by reference to the
2324 person's travel status;
2325 (ii) an employer, as policyholder, covering any group of employees, dependents, or
2326 guests, as defined by reference to specified hazards incident to any activities of the
2327 policyholder;
2328 (iii) an institution of learning, including a school district, a school jurisdictional unit, or
2329 the head, principal, or governing board of a school jurisdictional unit, as policyholder, covering
2330 students, teachers, or employees;
2331 (iv) a religious, charitable, recreational, educational, or civic organization, or branch of
2332 one of those organizations, as policyholder, covering a group of members or participants as
2333 defined by reference to specified hazards incident to the activities sponsored or supervised by
2334 the policyholder;
2335 (v) a sports team, camp, or sponsor of a sports team or camp, as policyholder, covering
2336 members, campers, employees, officials, or supervisors;
2337 (vi) a volunteer fire department, first aid, civil defense, or other similar volunteer
2338 organization, as policyholder, covering a group of members or participants as defined by
2339 reference to specified hazards incident to activities sponsored, supervised, or participated in by
2340 the policyholder;
2341 (vii) a newspaper or other publisher, as policyholder, covering its carriers;
2342 (viii) a labor union, as a policyholder, covering a group of members or participants as
2343 defined by reference to specified hazards incident to the activities or operations sponsored or
2344 supervised by the policyholder;
2345 [
2346 [
2347
2348 hazards incident to the activities or operations sponsored or supervised by the policyholder;
2349 [
2350 [
2351 properly eligible for blanket accident and health insurance.
2352 (4) The judgment of the commissioner may be exercised on the basis of:
2353 (a) individual risks;
2354 (b) a class of risks; or
2355 (c) both Subsections (4)(a) and (b).
2356 Section 23. Section 31A-22-722 is amended to read:
2357 31A-22-722. Utah mini-COBRA benefits for employer group coverage.
2358 (1) An [
2359 coverage to be extended under the current employer's group policy for a period of 12 months,
2360 except as provided in Subsection (2). The right to extend coverage includes:
2361 (a) voluntary termination;
2362 (b) involuntary termination;
2363 (c) retirement;
2364 (d) death;
2365 (e) divorce or legal separation;
2366 (f) loss of dependent status;
2367 (g) sabbatical;
2368 (h) a disability;
2369 (i) leave of absence; or
2370 (j) reduction of hours.
2371 (2) (a) Notwithstanding Subsection (1), an employee may not extend coverage under
2372 the current employer's group insurance policy if the employee:
2373 (i) fails to pay premiums or contributions in accordance with the terms of the insurance
2374 policy;
2375 (ii) acquires other group coverage covering all preexisting conditions including
2376 maternity, if the coverage exists;
2377 (iii) performs an act or practice that constitutes fraud in connection with the coverage;
2378 (iv) makes an intentional misrepresentation of material fact under the terms of the
2379 coverage;
2380 (v) is terminated from employment for gross misconduct;
2381 (vi) is not continuously covered under the current employer's group policy for a period
2382 of three months immediately before the termination of the insurance policy due to an event set
2383 forth in Subsection (1);
2384 (vii) is eligible for an extension of coverage required by federal law;
2385 (viii) establishes residence outside of this state;
2386 (ix) moves out of the insurer's service area;
2387 (x) is eligible for similar coverage under another group insurance policy; or
2388 (xi) has the employee's coverage terminated because the employer's coverage is
2389 terminated, except as provided in Subsection (8).
2390 (b) The right to extend coverage under Subsection (1) applies to spouse or dependent
2391 coverage, including a surviving spouse or dependents whose coverage under the insurance
2392 policy terminates by reason of the death of the employee or member.
2393 (3) (a) The employer shall notify the following in writing of the right to extend group
2394 coverage and the payment amounts required for extension of coverage, including the manner,
2395 place, and time in which the payments shall be made:
2396 (i) a terminated insured;
2397 (ii) an ex-spouse of an insured; or
2398 (iii) if Subsection (2)(b) applies:
2399 (A) a surviving spouse; and
2400 (B) the guardian of surviving dependents, if different from a surviving spouse.
2401 (b) The notification required in Subsection (3)(a) shall be sent first class mail within 30
2402 days after the termination date of the group coverage to:
2403 (i) the terminated insured's home address as shown on the records of the employer;
2404 (ii) the address of the surviving spouse, if different from the insured's address and if
2405 shown on the records of the employer;
2406 (iii) the guardian of any dependents address, if different from the insured's address, and
2407 if shown on the records of the employer; and
2408 (iv) the address of the ex-spouse, if shown on the records of the employer.
2409 (4) The insurer shall provide the employee, spouse, or any eligible dependent the
2410 opportunity to extend the group coverage at the payment amount stated in Subsection (5) if:
2411 (a) the employer policyholder does not provide the terminated insured the written
2412 notification required by Subsection (3)(a); and
2413 (b) the employee or other individual eligible for extension contacts the insurer within
2414 60 days of coverage termination.
2415 (5) (a) A premium amount for extended group coverage may not exceed 102% of the
2416 group rate in effect for a group member, including an employer's contribution, if any, for a
2417 group insurance policy.
2418 (b) Except as provided in Subsection (5)(a), an insurer may not charge an insured an
2419 additional fee, an additional premium, interest, or any similar charge for electing extended
2420 group coverage.
2421 (6) Except as provided in this Subsection (6), coverage extends without interruption for
2422 12 months and may not terminate if the terminated insured or, with respect to a minor, the
2423 parent or guardian of the terminated insured:
2424 (a) elects to extend group coverage within 60 days of losing group coverage; and
2425 (b) tenders the amount required to the employer or insurer.
2426 (7) The insured's coverage may be terminated before 12 months if the terminated
2427 insured:
2428 (a) establishes residence outside of this state;
2429 (b) moves out of the insurer's service area;
2430 (c) fails to pay premiums or contributions in accordance with the terms of the insurance
2431 policy, including any timeliness requirements;
2432 (d) performs an act or practice that constitutes fraud in connection with the coverage;
2433 (e) makes an intentional misrepresentation of material fact under the terms of the
2434 coverage;
2435 (f) becomes eligible for similar coverage under another group insurance policy; or
2436 (g) has the coverage terminated because the employer's coverage is terminated, except
2437 as provided in Subsection (8).
2438 (8) If the current employer coverage is terminated and the employer replaces coverage
2439 with similar coverage under another group insurance policy, without interruption, the
2440 terminated insured, spouse, or the surviving spouse and guardian of dependents if Subsection
2441 (2)(b) applies, may obtain extension of coverage under the replacement group insurance policy:
2442 (a) for the balance of the period the terminated insured would have extended coverage
2443 under the replaced group insurance policy; and
2444 (b) if the terminated insured is otherwise eligible for extension of coverage.
2445 (9) An insurer shall require an insured employer to offer to the following individuals an
2446 open enrollment period at the same time as other regular employees:
2447 (a) an individual who extends group coverage and is current on payment; and
2448 (b) during the applicable grace period described in Subsection (3) or (4), an individual
2449 who is eligible to elect to extend group coverage.
2450 Section 24. Section 31A-22-726 is amended to read:
2451 31A-22-726. Abortion coverage restriction in health benefit plan and on health
2452 insurance exchange.
2453 (1) As used in this section, "permitted abortion coverage" means coverage for abortion:
2454 (a) that is necessary to avert:
2455 (i) the death of the woman on whom the abortion is performed; or
2456 (ii) a serious risk of substantial and irreversible impairment of a major bodily function
2457 of the woman on whom the abortion is performed;
2458 (b) of a fetus that has a defect that is documented by a physician or physicians to be
2459 uniformly diagnosable and uniformly lethal; or
2460 (c) where the woman is pregnant as a result of:
2461 (i) rape, as described in Section 76-5-402;
2462 (ii) rape of a child, as described in Section 76-5-402.1; or
2463 (iii) incest, as described in Subsection 76-5-406(10) or Section 76-7-102.
2464 (2) A person may not offer coverage for an abortion in a health benefit plan, unless the
2465 coverage is a type of permitted abortion coverage.
2466 [
2467
2468
2469 [
2470 abortion in a health insurance exchange created under the federal Patient Protection and
2471 Affordable Care Act, 111 P.L. 148, unless the coverage is a type of permitted abortion
2472 coverage.
2473 Section 25. Section 31A-23a-111 is amended to read:
2474 31A-23a-111. Revoking, suspending, surrendering, lapsing, limiting, or otherwise
2475 terminating a license -- Forfeiture -- Rulemaking for renewal or reinstatement.
2476 (1) A license type issued under this chapter remains in force until:
2477 (a) revoked or suspended under Subsection (5);
2478 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
2479 administrative action;
2480 (c) the licensee dies or is adjudicated incompetent as defined under:
2481 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2482 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2483 Minors;
2484 (d) lapsed under Section 31A-23a-113; or
2485 (e) voluntarily surrendered.
2486 (2) The following may be reinstated within one year after the day on which the license
2487 is no longer in force:
2488 (a) a lapsed license; or
2489 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
2490 not be reinstated after the license period in which the license is voluntarily surrendered.
2491 (3) Unless otherwise stated in a written agreement for the voluntary surrender of a
2492 license, submission and acceptance of a voluntary surrender of a license does not prevent the
2493 department from pursuing additional disciplinary or other action authorized under:
2494 (a) this title; or
2495 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
2496 Administrative Rulemaking Act.
2497 (4) A line of authority issued under this chapter remains in force until:
2498 (a) the qualifications pertaining to a line of authority are no longer met by the licensee;
2499 or
2500 (b) the supporting license type:
2501 (i) is revoked or suspended under Subsection (5);
2502 (ii) is surrendered to the commissioner and accepted by the commissioner in lieu of
2503 administrative action;
2504 (iii) lapses under Section 31A-23a-113; or
2505 (iv) is voluntarily surrendered; or
2506 (c) the licensee dies or is adjudicated incompetent as defined under:
2507 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2508 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2509 Minors.
2510 (5) (a) If the commissioner makes a finding under Subsection (5)(b), as part of an
2511 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
2512 commissioner may:
2513 (i) revoke:
2514 (A) a license; or
2515 (B) a line of authority;
2516 (ii) suspend for a specified period of 12 months or less:
2517 (A) a license; or
2518 (B) a line of authority;
2519 (iii) limit in whole or in part:
2520 (A) a license; or
2521 (B) a line of authority;
2522 (iv) deny a license application;
2523 (v) assess a forfeiture under Subsection 31A-2-308(1)(b)(i) or (1)(c)(i); or
2524 (vi) take a combination of actions under Subsections (5)(a)(i) through (iv) and
2525 Subsection (5)(a)(v).
2526 (b) The commissioner may take an action described in Subsection (5)(a) if the
2527 commissioner finds that the licensee:
2528 (i) is unqualified for a license or line of authority under Section 31A-23a-104,
2529 31A-23a-105, or 31A-23a-107;
2530 (ii) violates:
2531 (A) an insurance statute;
2532 (B) a rule that is valid under Subsection 31A-2-201(3); or
2533 (C) an order that is valid under Subsection 31A-2-201(4);
2534 (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
2535 delinquency proceedings in any state;
2536 (iv) fails to pay a final judgment rendered against the person in this state within 60
2537 days after the day on which the judgment became final;
2538 (v) fails to meet the same good faith obligations in claims settlement that is required of
2539 admitted insurers;
2540 (vi) is affiliated with and under the same general management or interlocking
2541 directorate or ownership as another insurance producer that transacts business in this state
2542 without a license;
2543 (vii) refuses:
2544 (A) to be examined; or
2545 (B) to produce its accounts, records, and files for examination;
2546 (viii) has an officer who refuses to:
2547 (A) give information with respect to the insurance producer's affairs; or
2548 (B) perform any other legal obligation as to an examination;
2549 (ix) provides information in the license application that is:
2550 (A) incorrect;
2551 (B) misleading;
2552 (C) incomplete; or
2553 (D) materially untrue;
2554 (x) violates an insurance law, valid rule, or valid order of another regulatory agency in
2555 any jurisdiction;
2556 (xi) obtains or attempts to obtain a license through misrepresentation or fraud;
2557 (xii) improperly withholds, misappropriates, or converts money or properties received
2558 in the course of doing insurance business;
2559 (xiii) intentionally misrepresents the terms of an actual or proposed:
2560 (A) insurance contract;
2561 (B) application for insurance; or
2562 (C) life settlement;
2563 (xiv) [
2564 (A) a felony; or
2565 (B) a misdemeanor involving fraud, misrepresentation, theft, or dishonesty;
2566 (xv) admits or is found to have committed an insurance unfair trade practice or fraud;
2567 (xvi) in the conduct of business in this state or elsewhere:
2568 (A) uses fraudulent, coercive, or dishonest practices; or
2569 (B) demonstrates incompetence, untrustworthiness, or financial irresponsibility;
2570 (xvii) has had an insurance license or other professional or occupational license, or an
2571 equivalent to an insurance license or registration, or other professional or occupational license
2572 or registration:
2573 (A) denied;
2574 (B) suspended;
2575 (C) revoked; or
2576 (D) surrendered to resolve an administrative action;
2577 (xviii) forges another's name to:
2578 (A) an application for insurance; or
2579 (B) a document related to an insurance transaction;
2580 (xix) improperly uses notes or another reference material to complete an examination
2581 for an insurance license;
2582 (xx) knowingly accepts insurance business from an individual who is not licensed;
2583 (xxi) fails to comply with an administrative or court order imposing a child support
2584 obligation;
2585 (xxii) fails to:
2586 (A) pay state income tax; or
2587 (B) comply with an administrative or court order directing payment of state income
2588 tax;
2589 (xxiii) [
2590 Violent Crime Control and Law Enforcement Act of 1994, 18 U.S.C. Sec. 1033 and [
2591
2592 such business as required by 18 U.S.C. Sec. 1033 [
2593
2594 (xxiv) engages in a method or practice in the conduct of business that endangers the
2595 legitimate interests of customers and the public[
2596 (xxv) has been convicted of any criminal felony involving dishonesty or breach of trust
2597 and has not obtained written consent to engage in the business of insurance or participate in
2598 such business as required by 18 U.S.C. Sec. 1033.
2599 (c) For purposes of this section, if a license is held by an agency, both the agency itself
2600 and any individual designated under the license are considered to be the holders of the license.
2601 (d) If an individual designated under the agency license commits an act or fails to
2602 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
2603 the commissioner may suspend, revoke, or limit the license of:
2604 (i) the individual;
2605 (ii) the agency, if the agency:
2606 (A) is reckless or negligent in its supervision of the individual; or
2607 (B) knowingly participates in the act or failure to act that is the ground for suspending,
2608 revoking, or limiting the license; or
2609 (iii) (A) the individual; and
2610 (B) the agency if the agency meets the requirements of Subsection (5)(d)(ii).
2611 (6) A licensee under this chapter is subject to the penalties for acting as a licensee
2612 without a license if:
2613 (a) the licensee's license is:
2614 (i) revoked;
2615 (ii) suspended;
2616 (iii) limited;
2617 (iv) surrendered in lieu of administrative action;
2618 (v) lapsed; or
2619 (vi) voluntarily surrendered; and
2620 (b) the licensee:
2621 (i) continues to act as a licensee; or
2622 (ii) violates the terms of the license limitation.
2623 (7) A licensee under this chapter shall immediately report to the commissioner:
2624 (a) a revocation, suspension, or limitation of the person's license in another state, the
2625 District of Columbia, or a territory of the United States;
2626 (b) the imposition of a disciplinary sanction imposed on that person by another state,
2627 the District of Columbia, or a territory of the United States; or
2628 (c) a judgment or injunction entered against that person on the basis of conduct
2629 involving:
2630 (i) fraud;
2631 (ii) deceit;
2632 (iii) misrepresentation; or
2633 (iv) a violation of an insurance law or rule.
2634 (8) (a) An order revoking a license under Subsection (5) or an agreement to surrender a
2635 license in lieu of administrative action may specify a time, not to exceed five years, within
2636 which the former licensee may not apply for a new license.
2637 (b) If no time is specified in an order or agreement described in Subsection (8)(a), the
2638 former licensee may not apply for a new license for five years from the day on which the order
2639 or agreement is made without the express approval by the commissioner.
2640 (9) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
2641 a license issued under this part if so ordered by a court.
2642 (10) The commissioner shall by rule prescribe the license renewal and reinstatement
2643 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
2644 Section 26. Section 31A-23a-402 is amended to read:
2645 31A-23a-402. Unfair marketing practices -- Communication -- Unfair
2646 discrimination -- Coercion or intimidation -- Restriction on choice.
2647 (1) (a) (i) Any of the following may not make or cause to be made any communication
2648 that contains false or misleading information, relating to an insurance product or contract, any
2649 insurer, or any licensee under this title, including information that is false or misleading
2650 because it is incomplete:
2651 (A) a person who is or should be licensed under this title;
2652 (B) an employee or producer of a person described in Subsection (1)(a)(i)(A);
2653 (C) a person whose primary interest is as a competitor of a person licensed under this
2654 title; and
2655 (D) a person on behalf of any of the persons listed in this Subsection (1)(a)(i).
2656 (ii) As used in this Subsection (1), "false or misleading information" includes:
2657 (A) assuring the nonobligatory payment of future dividends or refunds of unused
2658 premiums in any specific or approximate amounts, but reporting fully and accurately past
2659 experience is not false or misleading information; and
2660 (B) with intent to deceive a person examining it:
2661 (I) filing a report;
2662 (II) making a false entry in a record; or
2663 (III) wilfully refraining from making a proper entry in a record.
2664 (iii) A licensee under this title may not:
2665 (A) use any business name, slogan, emblem, or related device that is misleading or
2666 likely to cause the insurer or other licensee to be mistaken for another insurer or other licensee
2667 already in business; or
2668 (B) use any name, advertisement, or other insurance promotional material that would
2669 cause a reasonable person to mistakenly believe that a state or federal government agency,
2670 [
2671 Children's Health Insurance Program created in Title 26, Chapter 40, Utah Children's Health
2672 Insurance Act:
2673 (I) is responsible for the insurance sales activities of the person;
2674 (II) stands behind the credit of the person;
2675 (III) guarantees any returns on insurance products of or sold by the person; or
2676 (IV) is a source of payment of any insurance obligation of or sold by the person.
2677 (iv) A person who is not an insurer may not assume or use any name that deceptively
2678 implies or suggests that person is an insurer.
2679 (v) A person other than persons licensed as health maintenance organizations under
2680 Chapter 8, Health Maintenance Organizations and Limited Health Plans, may not use the term
2681 "Health Maintenance Organization" or "HMO" in referring to itself.
2682 (b) A licensee's violation creates a rebuttable presumption that the violation was also
2683 committed by the insurer if:
2684 (i) the licensee under this title distributes cards or documents, exhibits a sign, or
2685 publishes an advertisement that violates Subsection (1)(a), with reference to a particular
2686 insurer:
2687 (A) that the licensee represents; or
2688 (B) for whom the licensee processes claims; and
2689 (ii) the cards, documents, signs, or advertisements are supplied or approved by that
2690 insurer.
2691 (2) (a) A title insurer, individual title insurance producer, or agency title insurance
2692 producer or any officer or employee of the title insurer, individual title insurance producer, or
2693 agency title insurance producer may not pay, allow, give, or offer to pay, allow, or give,
2694 directly or indirectly, as an inducement to obtaining any title insurance business:
2695 (i) any rebate, reduction, or abatement of any rate or charge made incident to the
2696 issuance of the title insurance;
2697 (ii) any special favor or advantage not generally available to others;
2698 (iii) any money or other consideration, except if approved under Section 31A-2-405; or
2699 (iv) material inducement.
2700 (b) "Charge made incident to the issuance of the title insurance" includes escrow
2701 charges, and any other services that are prescribed in rule by the Title and Escrow Commission
2702 after consultation with the commissioner and subject to Section 31A-2-404.
2703 (c) An insured or any other person connected, directly or indirectly, with the
2704 transaction may not knowingly receive or accept, directly or indirectly, any benefit referred to
2705 in Subsection (2)(a), including:
2706 (i) a person licensed under Title 61, Chapter 2c, Utah Residential Mortgage Practices
2707 and Licensing Act;
2708 (ii) a person licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices
2709 Act;
2710 (iii) a builder;
2711 (iv) an attorney; or
2712 (v) an officer, employee, or agent of a person listed in this Subsection (2)(c)(iii).
2713 (3) (a) An insurer may not unfairly discriminate among policyholders by charging
2714 different premiums or by offering different terms of coverage, except on the basis of
2715 classifications related to the nature and the degree of the risk covered or the expenses involved.
2716 (b) Rates are not unfairly discriminatory if they are averaged broadly among persons
2717 insured under a group, blanket, or franchise policy, and the terms of those policies are not
2718 unfairly discriminatory merely because they are more favorable than in similar individual
2719 policies.
2720 (4) (a) This Subsection (4) applies to:
2721 (i) a person who is or should be licensed under this title;
2722 (ii) an employee of that licensee or person who should be licensed;
2723 (iii) a person whose primary interest is as a competitor of a person licensed under this
2724 title; and
2725 (iv) one acting on behalf of any person described in Subsections (4)(a)(i) through (iii).
2726 (b) A person described in Subsection (4)(a) may not commit or enter into any
2727 agreement to participate in any act of boycott, coercion, or intimidation that:
2728 (i) tends to produce:
2729 (A) an unreasonable restraint of the business of insurance; or
2730 (B) a monopoly in that business; or
2731 (ii) results in an applicant purchasing or replacing an insurance contract.
2732 (5) (a) (i) Subject to Subsection (5)(a)(ii), a person may not restrict in the choice of an
2733 insurer or licensee under this chapter, another person who is required to pay for insurance as a
2734 condition for the conclusion of a contract or other transaction or for the exercise of any right
2735 under a contract.
2736 (ii) A person requiring coverage may reserve the right to disapprove the insurer or the
2737 coverage selected on reasonable grounds.
2738 (b) The form of corporate organization of an insurer authorized to do business in this
2739 state is not a reasonable ground for disapproval, and the commissioner may by rule specify
2740 additional grounds that are not reasonable. This Subsection (5) does not bar an insurer from
2741 declining an application for insurance.
2742 (6) A person may not make any charge other than insurance premiums and premium
2743 financing charges for the protection of property or of a security interest in property, as a
2744 condition for obtaining, renewing, or continuing the financing of a purchase of the property or
2745 the lending of money on the security of an interest in the property.
2746 (7) (a) A licensee under this title may not refuse or fail to return promptly all indicia of
2747 agency to the principal on demand.
2748 (b) A licensee whose license is suspended, limited, or revoked under Section
2749 31A-2-308, 31A-23a-111, or 31A-23a-112 may not refuse or fail to return the license to the
2750 commissioner on demand.
2751 (8) (a) A person may not engage in an unfair method of competition or any other unfair
2752 or deceptive act or practice in the business of insurance, as defined by the commissioner by
2753 rule, after a finding that the method of competition, the act, or the practice:
2754 (i) is misleading;
2755 (ii) is deceptive;
2756 (iii) is unfairly discriminatory;
2757 (iv) provides an unfair inducement; or
2758 (v) unreasonably restrains competition.
2759 (b) Notwithstanding Subsection (8)(a), for purpose of the title insurance industry, the
2760 Title and Escrow Commission shall make rules, subject to Section 31A-2-404, that define an
2761 unfair method of competition or unfair or deceptive act or practice after a finding that the
2762 method of competition, the act, or the practice:
2763 (i) is misleading;
2764 (ii) is deceptive;
2765 (iii) is unfairly discriminatory;
2766 (iv) provides an unfair inducement; or
2767 (v) unreasonably restrains competition.
2768 Section 27. Section 31A-23a-411.1 is amended to read:
2769 31A-23a-411.1. Person's liability if premium received is not forwarded to the
2770 insurer.
2771 A person commits insurance fraud as described in Subsection 31A-31-103(1)[
2772 that person knowingly fails to forward to the insurer a premium:
2773 (1) received from one of the following in partial or total payment of the premium due
2774 from:
2775 (a) an applicant;
2776 (b) a policyholder; or
2777 (c) a certificate holder; or
2778 (2) collected from or on behalf of an insured employee under an insured employee
2779 benefit plan.
2780 Section 28. Section 31A-23a-415 is amended to read:
2781 31A-23a-415. Assessment on agency title insurance producers or title insurers --
2782 Account created.
2783 (1) For purposes of this section:
2784 (a) "Premium" is as defined in Subsection 59-9-101(3).
2785 (b) "Title insurer" means a person:
2786 (i) making any contract or policy of title insurance as:
2787 (A) insurer;
2788 (B) guarantor; or
2789 (C) surety;
2790 (ii) proposing to make any contract or policy of title insurance as:
2791 (A) insurer;
2792 (B) guarantor; or
2793 (C) surety; or
2794 (iii) transacting or proposing to transact any phase of title insurance, including:
2795 (A) soliciting;
2796 (B) negotiating preliminary to execution;
2797 (C) executing of a contract of title insurance;
2798 (D) insuring; and
2799 (E) transacting matters subsequent to the execution of the contract and arising out of
2800 the contract.
2801 (c) "Utah risks" means insuring, guaranteeing, or indemnifying with regard to real or
2802 personal property located in Utah, an owner of real or personal property, the holders of liens or
2803 encumbrances on that property, or others interested in the property against loss or damage
2804 suffered by reason of:
2805 (i) liens or encumbrances upon, defects in, or the unmarketability of the title to the
2806 property; or
2807 (ii) invalidity or unenforceability of any liens or encumbrances on the property.
2808 (2) (a) The commissioner may assess each title insurer, each individual title insurance
2809 producer who is not an employee of a title insurer or who is not designated by an agency title
2810 insurance producer, and each agency title insurance producer an annual assessment:
2811 (i) determined by the Title and Escrow Commission:
2812 (A) after consultation with the commissioner; and
2813 (B) in accordance with this Subsection (2); and
2814 (ii) to be used for the purposes described in Subsection (3).
2815 (b) An agency title insurance producer and individual title insurance producer who is
2816 not an employee of a title insurer or who is not designated by an agency title insurance
2817 producer shall be assessed up to:
2818 (i) $250 for the first office in each county in which the agency title insurance producer
2819 or individual title insurance producer maintains an office; and
2820 (ii) $150 for each additional office the agency title insurance producer or individual
2821 title insurance producer maintains in the county described in Subsection (2)(b)(i).
2822 (c) A title insurer shall be assessed up to:
2823 (i) $250 for the first office in each county in which the title insurer maintains an office;
2824 (ii) $150 for each additional office the title insurer maintains in the county described in
2825 Subsection (2)(c)(i); and
2826 (iii) an amount calculated by:
2827 (A) aggregating the assessments imposed on:
2828 (I) agency title insurance producers and individual title insurance producers under
2829 Subsection (2)(b); and
2830 (II) title insurers under Subsections (2)(c)(i) and (2)(c)(ii);
2831 (B) subtracting the amount determined under Subsection (2)(c)(iii)(A) from the total
2832 costs and expenses determined under Subsection (2)(d); and
2833 (C) multiplying:
2834 (I) the amount calculated under Subsection (2)(c)(iii)(B); and
2835 (II) the percentage of total premiums for title insurance on Utah risk that are premiums
2836 of the title insurer.
2837 (d) Notwithstanding Section 31A-3-103 and subject to Section 31A-2-404, the Title
2838 and Escrow Commission by rule shall establish the amount of costs and expenses described
2839 under Subsection (3) that will be covered by the assessment, except the costs or expenses to be
2840 covered by the assessment may not exceed $100,000 annually.
2841 (e) (i) An individual licensed to practice law in Utah is exempt from the requirements
2842 of this Subsection (2) if that person issues 12 or less policies during a 12-month period.
2843 (ii) In determining the number of policies issued by an individual licensed to practice
2844 law in Utah for purposes of Subsection (2)(e)(i), if the individual issues a policy to more than
2845 one party to the same closing, the individual is considered to have issued only one policy.
2846 (3) (a) Money received by the state under this section shall be deposited into the Title
2847 Licensee Enforcement Restricted Account.
2848 (b) There is created in the General Fund a restricted account known as the "Title
2849 Licensee Enforcement Restricted Account."
2850 (c) The Title Licensee Enforcement Restricted Account shall consist of the money
2851 received by the state under this section.
2852 (d) The commissioner shall administer the Title Licensee Enforcement Restricted
2853 Account. Subject to appropriations by the Legislature, the commissioner shall use the money
2854 deposited into the Title Licensee Enforcement Restricted Account only to pay for a cost or
2855 expense incurred by the department in the administration, investigation, and enforcement of
2856 [
2857 individual title insurance producers, agency title insurance producers, or title insurers.
2858 [
2859 [
2860 (e) An appropriation from the Title Licensee Enforcement Restricted Account is
2861 nonlapsing.
2862 (4) The assessment imposed by this section shall be in addition to any premium
2863 assessment imposed under Subsection 59-9-101(3).
2864 Section 29. Section 31A-23b-401 is amended to read:
2865 31A-23b-401. Revoking, suspending, surrendering, lapsing, limiting, or otherwise
2866 terminating a license -- Rulemaking for renewal or reinstatement.
2867 (1) A license as a navigator under this chapter remains in force until:
2868 (a) revoked or suspended under Subsection (4);
2869 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
2870 administrative action;
2871 (c) the licensee dies or is adjudicated incompetent as defined under:
2872 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
2873 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
2874 Minors;
2875 (d) lapsed under this section; or
2876 (e) voluntarily surrendered.
2877 (2) The following may be reinstated within one year after the day on which the license
2878 is no longer in force:
2879 (a) a lapsed license; or
2880 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
2881 not be reinstated after the license period in which the license is voluntarily surrendered.
2882 (3) Unless otherwise stated in a written agreement for the voluntary surrender of a
2883 license, submission and acceptance of a voluntary surrender of a license does not prevent the
2884 department from pursuing additional disciplinary or other action authorized under:
2885 (a) this title; or
2886 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
2887 Administrative Rulemaking Act.
2888 (4) (a) If the commissioner makes a finding under Subsection (4)(b), as part of an
2889 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
2890 commissioner may:
2891 (i) revoke a license;
2892 (ii) suspend a license for a specified period of 12 months or less;
2893 (iii) limit a license in whole or in part;
2894 (iv) deny a license application;
2895 (v) assess a forfeiture under Subsection 31A-2-308(1)(b)(i) or (1)(c)(i); or
2896 (vi) take a combination of actions under Subsections (4)(a)(i) through (iv) and
2897 Subsection (4)(a)(v).
2898 (b) The commissioner may take an action described in Subsection (4)(a) if the
2899 commissioner finds that the licensee:
2900 (i) is unqualified for a license under Section 31A-23b-204, 31A-23b-205, or
2901 31A-23b-206;
2902 (ii) violated:
2903 (A) an insurance statute;
2904 (B) a rule that is valid under Subsection 31A-2-201(3); or
2905 (C) an order that is valid under Subsection 31A-2-201(4);
2906 (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
2907 delinquency proceedings in any state;
2908 (iv) failed to pay a final judgment rendered against the person in this state within 60
2909 days after the day on which the judgment became final;
2910 (v) refused:
2911 (A) to be examined; or
2912 (B) to produce its accounts, records, and files for examination;
2913 (vi) had an officer who refused to:
2914 (A) give information with respect to the navigator's affairs; or
2915 (B) perform any other legal obligation as to an examination;
2916 (vii) provided information in the license application that is:
2917 (A) incorrect;
2918 (B) misleading;
2919 (C) incomplete; or
2920 (D) materially untrue;
2921 (viii) violated an insurance law, valid rule, or valid order of another regulatory agency
2922 in any jurisdiction;
2923 (ix) obtained or attempted to obtain a license through misrepresentation or fraud;
2924 (x) improperly withheld, misappropriated, or converted money or properties received
2925 in the course of doing insurance business;
2926 (xi) intentionally misrepresented the terms of an actual or proposed:
2927 (A) insurance contract;
2928 (B) application for insurance; or
2929 (C) application for public program;
2930 (xii) [
2931 (A) a felony; or
2932 (B) a misdemeanor involving fraud, misrepresentation, theft, or dishonesty;
2933 (xiii) admitted or is found to have committed an insurance unfair trade practice or
2934 fraud;
2935 (xiv) in the conduct of business in this state or elsewhere:
2936 (A) used fraudulent, coercive, or dishonest practices; or
2937 (B) demonstrated incompetence, untrustworthiness, or financial irresponsibility;
2938 (xv) has had an insurance license, navigator license, or [
2939 professional or occupational license or registration, or an equivalent of the same denied,
2940 suspended, [
2941 resolve an administrative action;
2942 (xvi) forged another's name to:
2943 (A) an application for insurance;
2944 (B) a document related to an insurance transaction;
2945 (C) a document related to an application for a public program; or
2946 (D) a document related to an application for premium subsidies;
2947 (xvii) improperly used notes or another reference material to complete an examination
2948 for a license;
2949 (xviii) knowingly accepted insurance business from an individual who is not licensed;
2950 (xix) failed to comply with an administrative or court order imposing a child support
2951 obligation;
2952 (xx) failed to:
2953 (A) pay state income tax; or
2954 (B) comply with an administrative or court order directing payment of state income
2955 tax;
2956 (xxi) [
2957 federal Violent Crime Control and Law Enforcement Act of 1994, 18 U.S.C. Sec. 1033 and
2958 [
2959 participate in such business as required by 18 U.S.C. Sec. 1033 [
2960
2961 (xxii) engaged in a method or practice in the conduct of business that endangered the
2962 legitimate interests of customers and the public[
2963 (xxiii) has been convicted of any criminal felony involving dishonesty or breach of
2964 trust and has not obtained written consent to engage in the business of insurance or participate
2965 in such business as required by 18 U.S.C. Sec. 1033.
2966 (c) For purposes of this section, if a license is held by an agency, both the agency itself
2967 and any individual designated under the license are considered to be the holders of the license.
2968 (d) If an individual designated under the agency license commits an act or fails to
2969 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
2970 the commissioner may suspend, revoke, or limit the license of:
2971 (i) the individual;
2972 (ii) the agency, if the agency:
2973 (A) is reckless or negligent in its supervision of the individual; or
2974 (B) knowingly participates in the act or failure to act that is the ground for suspending,
2975 revoking, or limiting the license; or
2976 (iii) (A) the individual; and
2977 (B) the agency if the agency meets the requirements of Subsection (4)(d)(ii).
2978 (5) A licensee under this chapter is subject to the penalties for acting as a licensee
2979 without a license if:
2980 (a) the licensee's license is:
2981 (i) revoked;
2982 (ii) suspended;
2983 (iii) surrendered in lieu of administrative action;
2984 (iv) lapsed; or
2985 (v) voluntarily surrendered; and
2986 (b) the licensee:
2987 (i) continues to act as a licensee; or
2988 (ii) violates the terms of the license limitation.
2989 (6) A licensee under this chapter shall immediately report to the commissioner:
2990 (a) a revocation, suspension, or limitation of the person's license in another state, the
2991 District of Columbia, or a territory of the United States;
2992 (b) the imposition of a disciplinary sanction imposed on that person by another state,
2993 the District of Columbia, or a territory of the United States; or
2994 (c) a judgment or injunction entered against that person on the basis of conduct
2995 involving:
2996 (i) fraud;
2997 (ii) deceit;
2998 (iii) misrepresentation; or
2999 (iv) a violation of an insurance law or rule.
3000 (7) (a) An order revoking a license under Subsection (4) or an agreement to surrender a
3001 license in lieu of administrative action may specify a time, not to exceed five years, within
3002 which the former licensee may not apply for a new license.
3003 (b) If no time is specified in an order or agreement described in Subsection (7)(a), the
3004 former licensee may not apply for a new license for five years from the day on which the order
3005 or agreement is made without the express approval of the commissioner.
3006 (8) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
3007 a license issued under this chapter if so ordered by a court.
3008 (9) The commissioner shall by rule prescribe the license renewal and reinstatement
3009 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
3010 Section 30. Section 31A-25-208 is amended to read:
3011 31A-25-208. Revoking, suspending, surrendering, lapsing, limiting, or otherwise
3012 terminating a license -- Rulemaking for renewal and reinstatement.
3013 (1) A license type issued under this chapter remains in force until:
3014 (a) revoked or suspended under Subsection (4);
3015 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
3016 administrative action;
3017 (c) the licensee dies or is adjudicated incompetent as defined under:
3018 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
3019 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
3020 Minors;
3021 (d) lapsed under Section 31A-25-210; or
3022 (e) voluntarily surrendered.
3023 (2) The following may be reinstated within one year after the day on which the license
3024 is no longer in force:
3025 (a) a lapsed license; or
3026 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
3027 not be reinstated after the license period in which the license is voluntarily surrendered.
3028 (3) Unless otherwise stated in a written agreement for the voluntary surrender of a
3029 license, submission and acceptance of a voluntary surrender of a license does not prevent the
3030 department from pursuing additional disciplinary or other action authorized under:
3031 (a) this title; or
3032 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
3033 Administrative Rulemaking Act.
3034 (4) (a) If the commissioner makes a finding under Subsection (4)(b), as part of an
3035 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
3036 commissioner may:
3037 (i) revoke a license;
3038 (ii) suspend a license for a specified period of 12 months or less;
3039 (iii) limit a license in whole or in part; or
3040 (iv) deny a license application.
3041 (b) The commissioner may take an action described in Subsection (4)(a) if the
3042 commissioner finds that the licensee:
3043 (i) is unqualified for a license under Section 31A-25-202, 31A-25-203, or 31A-25-204;
3044 (ii) has violated:
3045 (A) an insurance statute;
3046 (B) a rule that is valid under Subsection 31A-2-201(3); or
3047 (C) an order that is valid under Subsection 31A-2-201(4);
3048 (iii) is insolvent or the subject of receivership, conservatorship, rehabilitation, or other
3049 delinquency proceedings in any state;
3050 (iv) fails to pay a final judgment rendered against the person in this state within 60
3051 days after the day on which the judgment became final;
3052 (v) fails to meet the same good faith obligations in claims settlement that is required of
3053 admitted insurers;
3054 (vi) is affiliated with and under the same general management or interlocking
3055 directorate or ownership as another third party administrator that transacts business in this state
3056 without a license;
3057 (vii) refuses:
3058 (A) to be examined; or
3059 (B) to produce its accounts, records, and files for examination;
3060 (viii) has an officer who refuses to:
3061 (A) give information with respect to the third party administrator's affairs; or
3062 (B) perform any other legal obligation as to an examination;
3063 (ix) provides information in the license application that is:
3064 (A) incorrect;
3065 (B) misleading;
3066 (C) incomplete; or
3067 (D) materially untrue;
3068 (x) has violated an insurance law, valid rule, or valid order of another regulatory
3069 agency in any jurisdiction;
3070 (xi) has obtained or attempted to obtain a license through misrepresentation or fraud;
3071 (xii) has improperly withheld, misappropriated, or converted money or properties
3072 received in the course of doing insurance business;
3073 (xiii) has intentionally misrepresented the terms of an actual or proposed:
3074 (A) insurance contract; or
3075 (B) application for insurance;
3076 (xiv) has been convicted of:
3077 (A) a felony; or
3078 (B) a misdemeanor involving fraud, misrepresentation, theft, or dishonesty;
3079 (xv) has admitted or been found to have committed an insurance unfair trade practice
3080 or fraud;
3081 (xvi) in the conduct of business in this state or elsewhere has:
3082 (A) used fraudulent, coercive, or dishonest practices; or
3083 (B) demonstrated incompetence, untrustworthiness, or financial irresponsibility;
3084 (xvii) has had an insurance license or [
3085 occupational license or registration, or an equivalent of the same, denied, suspended, [
3086 revoked [
3087 administrative action;
3088 (xviii) has forged another's name to:
3089 (A) an application for insurance; or
3090 (B) a document related to an insurance transaction;
3091 (xix) has improperly used notes or any other reference material to complete an
3092 examination for an insurance license;
3093 (xx) has knowingly accepted insurance business from an individual who is not
3094 licensed;
3095 (xxi) has failed to comply with an administrative or court order imposing a child
3096 support obligation;
3097 (xxii) has failed to:
3098 (A) pay state income tax; or
3099 (B) comply with an administrative or court order directing payment of state income
3100 tax;
3101 (xxiii) has violated or permitted others to violate the federal Violent Crime Control and
3102 Law Enforcement Act of 1994, 18 U.S.C. Sec. 1033 and therefore under 18 U.S.C. Sec. 1033 is
3103 prohibited from engaging in the business of insurance; or
3104 (xxiv) has engaged in methods and practices in the conduct of business that endanger
3105 the legitimate interests of customers and the public.
3106 (c) For purposes of this section, if a license is held by an agency, both the agency itself
3107 and any individual designated under the license are considered to be the holders of the agency
3108 license.
3109 (d) If an individual designated under the agency license commits an act or fails to
3110 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
3111 the commissioner may suspend, revoke, or limit the license of:
3112 (i) the individual;
3113 (ii) the agency if the agency:
3114 (A) is reckless or negligent in its supervision of the individual; or
3115 (B) knowingly participated in the act or failure to act that is the ground for suspending,
3116 revoking, or limiting the license; or
3117 (iii) (A) the individual; and
3118 (B) the agency if the agency meets the requirements of Subsection (4)(d)(ii).
3119 (5) A licensee under this chapter is subject to the penalties for acting as a licensee
3120 without a license if:
3121 (a) the licensee's license is:
3122 (i) revoked;
3123 (ii) suspended;
3124 (iii) limited;
3125 (iv) surrendered in lieu of administrative action;
3126 (v) lapsed; or
3127 (vi) voluntarily surrendered; and
3128 (b) the licensee:
3129 (i) continues to act as a licensee; or
3130 (ii) violates the terms of the license limitation.
3131 (6) A licensee under this chapter shall immediately report to the commissioner:
3132 (a) a revocation, suspension, or limitation of the person's license in any other state, the
3133 District of Columbia, or a territory of the United States;
3134 (b) the imposition of a disciplinary sanction imposed on that person by any other state,
3135 the District of Columbia, or a territory of the United States; or
3136 (c) a judgment or injunction entered against the person on the basis of conduct
3137 involving:
3138 (i) fraud;
3139 (ii) deceit;
3140 (iii) misrepresentation; or
3141 (iv) a violation of an insurance law or rule.
3142 (7) (a) An order revoking a license under Subsection (4) or an agreement to surrender a
3143 license in lieu of administrative action may specify a time, not to exceed five years, within
3144 which the former licensee may not apply for a new license.
3145 (b) If no time is specified in the order or agreement described in Subsection (7)(a), the
3146 former licensee may not apply for a new license for five years from the day on which the order
3147 or agreement is made without the express approval of the commissioner.
3148 (8) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
3149 a license issued under this part if so ordered by the court.
3150 (9) The commissioner shall by rule prescribe the license renewal and reinstatement
3151 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
3152 Section 31. Section 31A-26-213 is amended to read:
3153 31A-26-213. Revoking, suspending, surrendering, lapsing, limiting, or otherwise
3154 terminating a license -- Forfeiture -- Rulemaking for renewal or reinstatement.
3155 (1) A license type issued under this chapter remains in force until:
3156 (a) revoked or suspended under Subsection (5);
3157 (b) surrendered to the commissioner and accepted by the commissioner in lieu of
3158 administrative action;
3159 (c) the licensee dies or is adjudicated incompetent as defined under:
3160 (i) Title 75, Chapter 5, Part 3, Guardians of Incapacitated Persons; or
3161 (ii) Title 75, Chapter 5, Part 4, Protection of Property of Persons Under Disability and
3162 Minors;
3163 (d) lapsed under Section 31A-26-214.5; or
3164 (e) voluntarily surrendered.
3165 (2) The following may be reinstated within one year after the day on which the license
3166 is no longer in force:
3167 (a) a lapsed license; or
3168 (b) a voluntarily surrendered license, except that a voluntarily surrendered license may
3169 not be reinstated after the license period in which it is voluntarily surrendered.
3170 (3) Unless otherwise stated in a written agreement for the voluntary surrender of a
3171 license, submission and acceptance of a voluntary surrender of a license does not prevent the
3172 department from pursuing additional disciplinary or other action authorized under:
3173 (a) this title; or
3174 (b) rules made under this title in accordance with Title 63G, Chapter 3, Utah
3175 Administrative Rulemaking Act.
3176 (4) A license classification issued under this chapter remains in force until:
3177 (a) the qualifications pertaining to a license classification are no longer met by the
3178 licensee; or
3179 (b) the supporting license type:
3180 (i) is revoked or suspended under Subsection (5); or
3181 (ii) is surrendered to the commissioner and accepted by the commissioner in lieu of
3182 administrative action.
3183 (5) (a) If the commissioner makes a finding under Subsection (5)(b) as part of an
3184 adjudicative proceeding under Title 63G, Chapter 4, Administrative Procedures Act, the
3185 commissioner may:
3186 (i) revoke:
3187 (A) a license; or
3188 (B) a license classification;
3189 (ii) suspend for a specified period of 12 months or less:
3190 (A) a license; or
3191 (B) a license classification;
3192 (iii) limit in whole or in part:
3193 (A) a license; or
3194 (B) a license classification;
3195 (iv) deny a license application;
3196 (v) assess a forfeiture under Subsection 31A-2-308(1)(b)(i) or (1)(c)(i); or
3197 (vi) take a combination of actions under Subsections (5)(a)(i) through (iv) and
3198 Subsection (5)(a)(v).
3199 (b) The commissioner may take an action described in Subsection (5)(a) if the
3200 commissioner finds that the licensee:
3201 (i) is unqualified for a license or license classification under Section 31A-26-202,
3202 31A-26-203, 31A-26-204, or 31A-26-205;
3203 (ii) has violated:
3204 (A) an insurance statute;
3205 (B) a rule that is valid under Subsection 31A-2-201(3); or
3206 (C) an order that is valid under Subsection 31A-2-201(4);
3207 (iii) is insolvent, or the subject of receivership, conservatorship, rehabilitation, or other
3208 delinquency proceedings in any state;
3209 (iv) fails to pay a final judgment rendered against the person in this state within 60
3210 days after the judgment became final;
3211 (v) fails to meet the same good faith obligations in claims settlement that is required of
3212 admitted insurers;
3213 (vi) is affiliated with and under the same general management or interlocking
3214 directorate or ownership as another insurance adjuster that transacts business in this state
3215 without a license;
3216 (vii) refuses:
3217 (A) to be examined; or
3218 (B) to produce its accounts, records, and files for examination;
3219 (viii) has an officer who refuses to:
3220 (A) give information with respect to the insurance adjuster's affairs; or
3221 (B) perform any other legal obligation as to an examination;
3222 (ix) provides information in the license application that is:
3223 (A) incorrect;
3224 (B) misleading;
3225 (C) incomplete; or
3226 (D) materially untrue;
3227 (x) has violated an insurance law, valid rule, or valid order of another regulatory
3228 agency in any jurisdiction;
3229 (xi) has obtained or attempted to obtain a license through misrepresentation or fraud;
3230 (xii) has improperly withheld, misappropriated, or converted money or properties
3231 received in the course of doing insurance business;
3232 (xiii) has intentionally misrepresented the terms of an actual or proposed:
3233 (A) insurance contract; or
3234 (B) application for insurance;
3235 (xiv) has been convicted of:
3236 (A) a felony; or
3237 (B) a misdemeanor involving fraud, misrepresentation, theft, or dishonesty;
3238 (xv) has admitted or been found to have committed an insurance unfair trade practice
3239 or fraud;
3240 (xvi) in the conduct of business in this state or elsewhere has:
3241 (A) used fraudulent, coercive, or dishonest practices; or
3242 (B) demonstrated incompetence, untrustworthiness, or financial irresponsibility;
3243 (xvii) has had an insurance license[
3244 occupational license or registration, or equivalent, denied, suspended, [
3245
3246 (xviii) has forged another's name to:
3247 (A) an application for insurance; or
3248 (B) a document related to an insurance transaction;
3249 (xix) has improperly used notes or any other reference material to complete an
3250 examination for an insurance license;
3251 (xx) has knowingly accepted insurance business from an individual who is not
3252 licensed;
3253 (xxi) has failed to comply with an administrative or court order imposing a child
3254 support obligation;
3255 (xxii) has failed to:
3256 (A) pay state income tax; or
3257 (B) comply with an administrative or court order directing payment of state income
3258 tax;
3259 (xxiii) has [
3260 federal Violent Crime Control and Law Enforcement Act of 1994, 18 U.S.C. Sec. 1033 and
3261 [
3262 has not obtained written consent in accordance with 18 U.S.C. Sec. 1033 to engage in the
3263 business of insurance or participate in such business; [
3264 (xxiv) has engaged in methods and practices in the conduct of business that endanger
3265 the legitimate interests of customers and the public[
3266 (xxv) has been convicted of any criminal felony involving dishonesty or breach of trust
3267 and has not obtained written consent in accordance with 18 U.S.C. Sec. 1033 to engage in the
3268 business of insurance or participate in such business.
3269 (c) For purposes of this section, if a license is held by an agency, both the agency itself
3270 and any individual designated under the license are considered to be the holders of the license.
3271 (d) If an individual designated under the agency license commits an act or fails to
3272 perform a duty that is a ground for suspending, revoking, or limiting the individual's license,
3273 the commissioner may suspend, revoke, or limit the license of:
3274 (i) the individual;
3275 (ii) the agency, if the agency:
3276 (A) is reckless or negligent in its supervision of the individual; or
3277 (B) knowingly participated in the act or failure to act that is the ground for suspending,
3278 revoking, or limiting the license; or
3279 (iii) (A) the individual; and
3280 (B) the agency if the agency meets the requirements of Subsection (5)(d)(ii).
3281 (6) A licensee under this chapter is subject to the penalties for conducting an insurance
3282 business without a license if:
3283 (a) the licensee's license is:
3284 (i) revoked;
3285 (ii) suspended;
3286 (iii) limited;
3287 (iv) surrendered in lieu of administrative action;
3288 (v) lapsed; or
3289 (vi) voluntarily surrendered; and
3290 (b) the licensee:
3291 (i) continues to act as a licensee; or
3292 (ii) violates the terms of the license limitation.
3293 (7) A licensee under this chapter shall immediately report to the commissioner:
3294 (a) a revocation, suspension, or limitation of the person's license in any other state, the
3295 District of Columbia, or a territory of the United States;
3296 (b) the imposition of a disciplinary sanction imposed on that person by any other state,
3297 the District of Columbia, or a territory of the United States; or
3298 (c) a judgment or injunction entered against that person on the basis of conduct
3299 involving:
3300 (i) fraud;
3301 (ii) deceit;
3302 (iii) misrepresentation; or
3303 (iv) a violation of an insurance law or rule.
3304 (8) (a) An order revoking a license under Subsection (5) or an agreement to surrender a
3305 license in lieu of administrative action may specify a time not to exceed five years within
3306 which the former licensee may not apply for a new license.
3307 (b) If no time is specified in the order or agreement described in Subsection (8)(a), the
3308 former licensee may not apply for a new license for five years without the express approval of
3309 the commissioner.
3310 (9) The commissioner shall promptly withhold, suspend, restrict, or reinstate the use of
3311 a license issued under this part if so ordered by a court.
3312 (10) The commissioner shall by rule prescribe the license renewal and reinstatement
3313 procedures in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
3314 Section 32. Section 31A-27a-512.1 is enacted to read:
3315 31A-27a-512.1. Indemnitor liability.
3316 (1) (a) Except as otherwise provided in this chapter, the amount recoverable by the
3317 receiver from an indemnitor may not be reduced as a result of a delinquency proceeding with a
3318 finding of insolvency, regardless of any provision in the indemnity contract or other agreement.
3319 (b) To the extent an agreement, written or oral, conflicts with or is not in strict
3320 compliance with this section, the agreement is unenforceable.
3321 (c) Except as expressly provided in this section, a person who is not the receiver,
3322 including a creditor or third-party beneficiary, does not have a right to indemnity proceeds from
3323 any indemnitor of the insolvent insurer:
3324 (i) on the basis of any agreement, written or oral; or
3325 (ii) pursuant to an action or cause of action seeking any equitable or legal remedy.
3326 (d) This section applies to all the insurer's indemnity contracts.
3327 (2) The amount recoverable by the liquidator from an indemnitor is payable under one
3328 or more contract of indemnity on the basis of:
3329 (a) proof of payment of the insured claim by an affected guaranty association, the
3330 insurer, or the receiver, to the extent of payment; or
3331 (b) the allowance of the claim pursuant to:
3332 (i) Section 31A-27a-608;
3333 (ii) an order of the receivership court; or
3334 (iii) a plan of rehabilitation.
3335 (3) If an insurer takes credit for an indemnity contract in a filing or submission made to
3336 the commissioner and the indemnity contract does not contain the provisions required with
3337 respect to the obligations of indemnitor in the event of insolvency of the principal, the
3338 indemnity contract is considered to contain the provisions required with respect to:
3339 (a) the obligations of indemnitors in the event of insolvency of the principal in order to
3340 obtain indemnity; or
3341 (b) other applicable statutes.
3342 (4) An indemnity contract that under Subsection (3) is considered to contain certain
3343 provisions, is considered to contain a provision that:
3344 (a) in the event of insolvency and the appointment of a receiver, the indemnity
3345 obligation is payable to the indemnified insurer or to its receiver without diminution because of
3346 the insolvency or because the receiver fails to pay all or a portion of the claim;
3347 (b) payment shall be made upon:
3348 (i) to the extent of the payment, proof of payment of the insured claim by an affected
3349 guaranty association, the insurer, or the receiver; or
3350 (ii) the allowance of the claim pursuant to:
3351 (A) Section 31A-27a-608;
3352 (B) an order of the receivership court; or
3353 (C) a plan of rehabilitation; and
3354 (c) If an indemnitor does not pay the amount billed by the receiver within 60 days after
3355 the mailing by the receiver, interest on the unpaid billed amount will begin to accrue at the
3356 statutory legal rate described in Section 15-1-1, except that all or a portion of the interest may
3357 be waived.
3358 (5) (a) The receiver shall notify in writing, in accordance with the terms of the
3359 indemnity contract, each indemnitor obligated in relation to an indemnified claim or the
3360 pendency of an indemnified claim against the indemnified company.
3361 (b) (i) The receiver's failure to give notice of a pending claim does not excuse the
3362 obligation of the indemnitor, unless the indemnitor is prejudiced by the receiver's failure.
3363 (ii) If the indemnitor is prejudiced by the receiver's failure, indemnitor's obligation is
3364 reduced only to the extent of the prejudice.
3365 (c) In a proceeding in which an indemnified claim is to be adjudicated, an indemnitor
3366 may interpose, at its own expense, any one or more defenses that the indemnitor considers
3367 available to the indemnified company or its receiver.
3368 (6) The entry of an order of rehabilitation or liquidation is not:
3369 (a) a breach or an anticipatory breach of an indemnity contract; or
3370 (b) grounds for retroactive revocation or retroactive cancellation of an indemnity
3371 contract by the indemnifier.
3372 Section 33. Section 31A-30-103 is amended to read:
3373 31A-30-103. Definitions.
3374 As used in this chapter:
3375 (1) "Actuarial certification" means a written statement by a member of the American
3376 Academy of Actuaries or other individual approved by the commissioner that a covered carrier
3377 is in compliance with this chapter, based upon the examination of the covered carrier, including
3378 review of the appropriate records and of the actuarial assumptions and methods used by the
3379 covered carrier in establishing premium rates for applicable health benefit plans.
3380 (2) "Affiliate" or "affiliated" means a person who directly or indirectly through one or
3381 more intermediaries, controls or is controlled by, or is under common control with, a specified
3382 person.
3383 (3) "Base premium rate" means, for each class of business as to a rating period, the
3384 lowest premium rate charged or that could have been charged under a rating system for that
3385 class of business by the covered carrier to covered insureds with similar case characteristics for
3386 health benefit plans with the same or similar coverage.
3387 (4) (a) "Bona fide employer association" means an association of employers:
3388 (i) that meets the requirements of Subsection 31A-22-701(2)(b);
3389 (ii) in which the employers of the association, either directly or indirectly, exercise
3390 control over the plan;
3391 (iii) that is organized:
3392 (A) based on a commonality of interest between the employers and their employees
3393 that participate in the plan by some common economic or representation interest or genuine
3394 organizational relationship unrelated to the provision of benefits; and
3395 (B) to act in the best interests of its employers to provide benefits for the employer's
3396 employees and their spouses and dependents, and other benefits relating to employment; and
3397 (iv) whose association sponsored health plan complies with 45 C.F.R. 146.121.
3398 (b) The commissioner shall consider the following with regard to determining whether
3399 an association of employers is a bona fide employer association under Subsection (4)(a):
3400 (i) how association members are solicited;
3401 (ii) who participates in the association;
3402 (iii) the process by which the association was formed;
3403 (iv) the purposes for which the association was formed, and what, if any, were the
3404 pre-existing relationships of its members;
3405 (v) the powers, rights and privileges of employer members; and
3406 (vi) who actually controls and directs the activities and operations of the benefit
3407 programs.
3408 (5) "Carrier" means a person that provides health insurance in this state including:
3409 (a) an insurance company;
3410 (b) a prepaid hospital or medical care plan;
3411 (c) a health maintenance organization;
3412 (d) a multiple employer welfare arrangement; and
3413 (e) another person providing a health insurance plan under this title.
3414 (6) (a) Except as provided in Subsection (6)(b), "case characteristics" means
3415 demographic or other objective characteristics of a covered insured that are considered by the
3416 carrier in determining premium rates for the covered insured.
3417 (b) "Case characteristics" do not include:
3418 (i) duration of coverage since the policy was issued;
3419 (ii) claim experience; and
3420 (iii) health status.
3421 (7) "Class of business" means all or a separate grouping of covered insureds that is
3422 permitted by the commissioner in accordance with Section 31A-30-105.
3423 (8) "Covered carrier" means an individual carrier or small employer carrier subject to
3424 this chapter.
3425 (9) "Covered individual" means an individual who is covered under a health benefit
3426 plan subject to this chapter.
3427 (10) "Covered insureds" means small employers and individuals who are issued a
3428 health benefit plan that is subject to this chapter.
3429 (11) "Dependent" means an individual to the extent that the individual is defined to be
3430 a dependent by:
3431 (a) the health benefit plan covering the covered individual; and
3432 (b) Chapter 22, Part 6, Accident and Health Insurance.
3433 (12) "Established geographic service area" means a geographical area approved by the
3434 commissioner within which the carrier is authorized to provide coverage.
3435 (13) "Index rate" means, for each class of business as to a rating period for covered
3436 insureds with similar case characteristics, the arithmetic average of the applicable base
3437 premium rate and the corresponding highest premium rate.
3438 (14) "Individual carrier" means a carrier that provides coverage on an individual basis
3439 through a health benefit plan regardless of whether:
3440 (a) coverage is offered through:
3441 (i) an association;
3442 (ii) a trust;
3443 (iii) a discretionary group; or
3444 (iv) other similar groups; or
3445 (b) the policy or contract is situated out-of-state.
3446 (15) "Individual conversion policy" means a conversion policy issued to:
3447 (a) an individual; or
3448 (b) an individual with a family.
3449 (16) "New business premium rate" means, for each class of business as to a rating
3450 period, the lowest premium rate charged or offered, or that could have been charged or offered,
3451 by the carrier to covered insureds with similar case characteristics for newly issued health
3452 benefit plans with the same or similar coverage.
3453 (17) "Premium" means money paid by covered insureds and covered individuals as a
3454 condition of receiving coverage from a covered carrier, including fees or other contributions
3455 associated with the health benefit plan.
3456 (18) (a) "Rating period" means the calendar period for which premium rates
3457 established by a covered carrier are assumed to be in effect, as determined by the carrier.
3458 (b) A covered carrier may not have:
3459 (i) more than one rating period in any calendar month; and
3460 (ii) no more than 12 rating periods in any calendar year.
3461 [
3462 [
3463 [
3464
3465 [
3466 covering eligible employees of one or more small employers in this state, regardless of
3467 whether:
3468 (a) coverage is offered through:
3469 (i) an association;
3470 (ii) a trust;
3471 (iii) a discretionary group; or
3472 (iv) other similar grouping; or
3473 (b) the policy or contract is situated out-of-state.
3474 Section 34. Section 31A-30-118 is amended to read:
3475 31A-30-118. Patient Protection and Affordable Care Act -- State insurance
3476 mandates -- Cost of additional benefits.
3477 (1) (a) The commissioner shall identify a new mandated benefit that is in excess of the
3478 essential health benefits required by PPACA.
3479 (b) The state shall quantify the cost attributable to each additional mandated benefit
3480 specified in Subsection (1)(a) based on a qualified health plan issuer's calculation of the cost
3481 associated with the mandated benefit, which shall be:
3482 (i) calculated in accordance with generally accepted actuarial principles and
3483 methodologies;
3484 (ii) conducted by a member of the American Academy of Actuaries; and
3485 (iii) reported to the commissioner and to the individual exchange operating in the state.
3486 (c) The commissioner may require a proponent of a new mandated benefit under
3487 Subsection (1)(a) to provide the commissioner with a cost analysis conducted in accordance
3488 with Subsection (1)(b). The commissioner may use the cost information provided under this
3489 Subsection (1)(c) to establish estimates of the cost to the state under Subsection (2).
3490 (2) If the state is required to defray the cost of additional required benefits under the
3491 provisions of 45 C.F.R. 155.170:
3492 (a) the state shall make the required payments:
3493 (i) in accordance with Subsection (3); and
3494 (ii) directly to the qualified health plan issuer in accordance with 45 C.F.R. 155.170;
3495 (b) an issuer of a qualified health plan that receives a payment under the provisions of
3496 Subsection (1) and 45 C.F.R. 155.170 shall:
3497 (i) reduce the premium charged to the individual on whose behalf the issuer will be
3498 paid under Subsection (1), in an amount equal to the amount of the payment under Subsection
3499 (1); or
3500 (ii) notwithstanding Subsection 31A-23a-402.5(5), provide a premium rebate to an
3501 individual on whose behalf the issuer received a payment under Subsection (1), in an amount
3502 equal to the amount of the payment under Subsection (1); and
3503 (c) a premium rebate made under this section is not a prohibited inducement under
3504 Section 31A-23a-402.5.
3505 (3) A payment required under 45 C.F.R. 155.170(c) shall:
3506 (a) unless otherwise required by PPACA, be based on a statewide average of the cost
3507 of the additional benefit for all issuers who are entitled to payment under the provisions of 45
3508 C.F.R. 155.70; and
3509 (b) be submitted to an issuer through a process established and administered by:
3510 (i) the federal marketplace exchange for the state under PPACA for individual health
3511 plans; or
3512 (ii) Avenue H small employer market exchange for qualified health plans offered on
3513 the exchange.
3514 (4) The commissioner:
3515 (a) may adopt rules as necessary to administer the provisions of this section and 45
3516 C.F.R. 155.170; and
3517 (b) may not establish or implement the process for submitting the payments to an issuer
3518 under Subsection (3)(b)(i) [
3519
3520 Section 35. Section 31A-31-103 is amended to read:
3521 31A-31-103. Fraudulent insurance act.
3522 (1) A person commits a fraudulent insurance act if that person with intent to deceive or
3523 defraud:
3524 (a) knowingly presents or causes to be presented to an insurer any oral or written
3525 statement or representation knowing that the statement or representation contains false,
3526 incomplete, or misleading information concerning any fact material to an application for the
3527 issuance or renewal of an insurance policy, certificate, or contract[
3528 (i) obtaining an insurance policy the insurer would otherwise not issue on the basis of
3529 underwriting criteria applicable to the person;
3530 (ii) a scheme or artifice to avoid paying the premium that an insurer charges on the
3531 basis of underwriting criteria applicable to the person; or
3532 (iii) a scheme or artifice to file an insurance claim for a loss that has already occurred;
3533 (b) [
3534 statement or representation:
3535 (i) (A) as part of, or in support of, a claim for payment or other benefit pursuant to an
3536 insurance policy, certificate, or contract; or
3537 (B) in connection with any civil claim asserted for recovery of damages for personal or
3538 bodily injuries or property damage; and
3539 (ii) knowing that the statement or representation contains false, incomplete, or
3540 misleading information concerning any fact or thing material to the claim;
3541 (c) knowingly accepts a benefit from the proceeds derived from a fraudulent insurance
3542 act;
3543 (d) intentionally, knowingly, or recklessly devises a scheme or artifice to obtain fees
3544 for anything of value, including professional services, by means of false or fraudulent
3545 pretenses, representations, promises, or material omissions;
3546 [
3547 fraudulent insurance act;
3548 [
3549 or statement required by the department;
3550 [
3551 31A-23a-411.1; or
3552 [
3553 fraudulent insurance act.
3554 (2) A service provider commits a fraudulent insurance act if that service provider with
3555 intent to deceive or defraud:
3556 (a) knowingly submits or causes to be submitted a bill or request for payment:
3557 (i) containing charges or costs for an item or service that are substantially in excess of
3558 customary charges or costs for the item or service; or
3559 (ii) containing itemized or delineated fees for what would customarily be considered a
3560 single procedure or service;
3561 (b) knowingly furnishes or causes to be furnished an item or service to a person:
3562 (i) substantially in excess of the needs of the person; or
3563 (ii) of a quality that fails to meet professionally recognized standards;
3564 (c) knowingly accepts a benefit from the proceeds derived from a fraudulent insurance
3565 act; or
3566 (d) assists, abets, solicits, or conspires with another to commit a fraudulent insurance
3567 act.
3568 (3) An insurer commits a fraudulent insurance act if that insurer with intent to deceive
3569 or defraud:
3570 (a) knowingly withholds information or provides false or misleading information with
3571 respect to an application, coverage, benefits, or claims under a policy or certificate;
3572 (b) assists, abets, solicits, or conspires with another to commit a fraudulent insurance
3573 act;
3574 (c) knowingly accepts a benefit from the proceeds derived from a fraudulent insurance
3575 act; or
3576 (d) knowingly supplies false or fraudulent material information in any document or
3577 statement required by the department.
3578 (4) An insurer or service provider is not liable for any fraudulent insurance act
3579 committed by an employee without the authority of the insurer or service provider unless the
3580 insurer or service provider knew or should have known of the fraudulent insurance act.
3581 Section 36. Section 31A-31-107 is amended to read:
3582 31A-31-107. Workers' compensation insurance fraud.
3583 (1) In any action involving workers' compensation insurance, Section 34A-2-110
3584 supersedes this chapter.
3585 (2) Nothing in this section prohibits the department from investigating and pursuing
3586 civil or criminal penalties in accordance with Section 31A-31-109 and Title 34A, Utah Labor
3587 Code, for violations of Section 34A-2-110.
3588 Section 37. Section 31A-35-405 is amended to read:
3589 31A-35-405. Issuance of license -- Denial -- Right of appeal.
3590 (1) After the commissioner receives a complete application, fee, and any additional
3591 information in accordance with Section 31A-35-401, the board shall determine whether the
3592 applicant meets the requirements for issuance of a license under this chapter.
3593 [
3594
3595 of a license under this chapter, the commissioner shall issue to that person a bail bond agency
3596 license.
3597 (b) If the board determines that the applicant does not meet the requirements for
3598 issuance of a license under this chapter, the commissioner shall make a final determination as
3599 to whether to issue a license under this chapter.
3600 [
3601 under this chapter, the commissioner shall provide prompt written notification [
3602
3603 accordance with Title 63G, Chapter 4, Administrative Procedures Act.
3604 (b) In a proceeding described in Subsection (3)(a), the commissioner shall hold a
3605 hearing no later than 60 days after the day on which the commissioner receives a request for a
3606 hearing.
3607 [
3608 [
3609 [
3610 [
3611
3612 [
3613
3614 [
3615 [
3616 [
3617 [
3618 [
3619
3620 Section 38. Section 31A-37-102 is amended to read:
3621 31A-37-102. Definitions.
3622 As used in this chapter:
3623 (1) (a) "Affiliated company" means a business entity that because of common
3624 ownership, control, operation, or management is in the same corporate or limited liability
3625 company system as:
3626 (i) a parent;
3627 (ii) an industrial insured; or
3628 (iii) a member organization.
3629 (b) Notwithstanding Subsection (1)(a), the commissioner may issue an order finding
3630 that a business entity is not an affiliated company.
3631 (2) "Alien captive insurance company" means an insurer:
3632 (a) formed to write insurance business for a parent or affiliate of the insurer; and
3633 (b) licensed pursuant to the laws of an alien or foreign jurisdiction that imposes
3634 statutory or regulatory standards:
3635 (i) on a business entity transacting the business of insurance in the alien or foreign
3636 jurisdiction; and
3637 (ii) in a form acceptable to the commissioner.
3638 (3) "Applicant captive insurance company" means an entity that has submitted an
3639 application for a certificate of authority for a captive insurance company, unless the application
3640 has been denied or withdrawn.
3641 [
3642 in continuous existence for at least one year if:
3643 (a) the association or its member organizations:
3644 (i) own, control, or hold with power to vote all of the outstanding voting securities of
3645 an association captive insurance company incorporated as a stock insurer; or
3646 (ii) have complete voting control over an association captive insurance company
3647 incorporated as a mutual insurer;
3648 (b) the association's member organizations collectively constitute all of the subscribers
3649 of an association captive insurance company formed as a reciprocal insurer; or
3650 (c) the association or its member organizations have complete voting control over an
3651 association captive insurance company formed as a limited liability company.
3652 [
3653 risks of:
3654 (a) a member organization of the association;
3655 (b) an affiliate of a member organization of the association; and
3656 (c) the association.
3657 [
3658 insurance company in this state.
3659 [
3660 company that has a certificate of authority from the commissioner to transact the business of
3661 insurance in this state through a captive insurance company that is domiciled outside of this
3662 state.
3663 [
3664 company in this state.
3665 [
3666 certificate of authority under this chapter:
3667 (a) a branch captive insurance company;
3668 (b) a pure captive insurance company;
3669 (c) an association captive insurance company;
3670 (d) a sponsored captive insurance company;
3671 (e) an industrial insured captive insurance company, including an industrial insured
3672 captive insurance company formed as a risk retention group captive in this state pursuant to the
3673 provisions of the Federal Liability Risk Retention Act of 1986;
3674 (f) a special purpose captive insurance company; or
3675 (g) a special purpose financial captive insurance company.
3676 [
3677 commissioner's designee.
3678 [
3679 insurance companies are owned or controlled by the same person or group of persons as
3680 follows:
3681 (a) in the case of a captive insurance company that is a stock corporation, the direct or
3682 indirect ownership of 80% or more of the outstanding voting stock of the stock corporation;
3683 (b) in the case of a captive insurance company that is a mutual corporation, the direct
3684 or indirect ownership of 80% or more of the surplus and the voting power of the mutual
3685 corporation;
3686 (c) in the case of a captive insurance company that is a limited liability company, the
3687 direct or indirect ownership by the same member or members of 80% or more of the
3688 membership interests in the limited liability company; or
3689 (d) in the case of a sponsored captive insurance company, a protected cell is a separate
3690 captive insurance company owned and controlled by the protected cell's participant, only if:
3691 (i) the participant is the only participant with respect to the protected cell; and
3692 (ii) the participant is the sponsor or is affiliated with the sponsor of the sponsored
3693 captive insurance company through common ownership and control.
3694 [
3695 [
3696 (a) This Subsection [
3697 capital instruments including:
3698 (i) all borrowings from depository institutions;
3699 (ii) all senior debt;
3700 (iii) all subordinated debts;
3701 (iv) all trust preferred shares; and
3702 (v) all other hybrid capital instruments that are not included in the determination of
3703 consolidated GAAP net worth issued and outstanding.
3704 (b) This Subsection [
3705 (i) total capital consisting of all debts and hybrid capital instruments as described in
3706 Subsection [
3707 (ii) shareholders' equity determined in accordance with generally accepted accounting
3708 principles for reporting to the United States Securities and Exchange Commission.
3709 [
3710 members' equity determined in accordance with generally accepted accounting principles for
3711 reporting to the United States Securities and Exchange Commission.
3712 [
3713 (a) (i) in the case of a pure captive insurance company, that is not in the corporate or
3714 limited liability company system of a parent or the parent's affiliate; or
3715 (ii) in the case of an industrial insured captive insurance company, that is not in the
3716 corporate or limited liability company system of an industrial insured or an affiliated company
3717 of the industrial insured;
3718 (b) (i) in the case of a pure captive insurance company, that has a contractual
3719 relationship with a parent or affiliate; or
3720 (ii) in the case of an industrial insured captive insurance company, that has a
3721 contractual relationship with an industrial insured or an affiliated company of the industrial
3722 insured; and
3723 (c) whose risks that are or will be insured by a pure captive insurance company, an
3724 industrial insured captive insurance company, or both are managed in accordance with
3725 Subsection 31A-37-106(1)(j) by:
3726 (i) (A) a pure captive insurance company; or
3727 (B) an industrial insured captive insurance company; or
3728 (ii) a parent or affiliate of:
3729 (A) a pure captive insurance company; or
3730 (B) an industrial insured captive insurance company.
3731 [
3732 (15) "Establisher" means a person who establishes a business entity or a trust.
3733 (16) "Governing body" means the persons who hold the ultimate authority to direct and
3734 manage the affairs of an entity.
3735 [
3736 (a) that produces insurance:
3737 (i) by the services of a full-time employee acting as a risk manager or insurance
3738 manager; or
3739 (ii) using the services of a regularly and continuously qualified insurance consultant;
3740 (b) whose aggregate annual premiums for insurance on all risks total at least $25,000;
3741 and
3742 (c) that has at least 25 full-time employees.
3743 [
3744 that:
3745 (a) insures risks of the industrial insureds that comprise the industrial insured group;
3746 and
3747 (b) may insure the risks of:
3748 (i) an affiliated company of an industrial insured; or
3749 (ii) a controlled unaffiliated business of:
3750 (A) an industrial insured; or
3751 (B) an affiliated company of an industrial insured.
3752 [
3753 (a) a group of industrial insureds that collectively:
3754 (i) own, control, or hold with power to vote all of the outstanding voting securities of
3755 an industrial insured captive insurance company incorporated or organized as a limited liability
3756 company as a stock insurer; or
3757 (ii) have complete voting control over an industrial insured captive insurance company
3758 incorporated or organized as a limited liability company as a mutual insurer;
3759 (b) a group that is:
3760 (i) created under the Product Liability Risk Retention Act of 1981, 15 U.S.C. Sec. 3901
3761 et seq., as amended, as a corporation or other limited liability association; and
3762 (ii) taxable under this title as a:
3763 (A) stock corporation; or
3764 (B) mutual insurer; or
3765 (c) a group that has complete voting control over an industrial captive insurance
3766 company formed as a limited liability company.
3767 [
3768 [
3769 with power to vote more than 50% of[
3770 [
3771 [
3772
3773 [
3774 insurance company:
3775 (a) if the losses of the participant are limited through a participant contract to the assets
3776 of a protected cell; and
3777 (b)(i) the entity is permitted to be a participant under Section 31A-37-403; or
3778 (ii) the entity is an affiliate of an entity permitted to be a participant under Section
3779 31A-37-403.
3780 [
3781 insurance company:
3782 (a) insures the risks of a participant; and
3783 (b) limits the losses of the participant to the assets of a protected cell.
3784 [
3785 sponsored captive insurance company for one participant.
3786 [
3787 of a parent or affiliate of the business entity.
3788 [
3789 Section 31A-37a-102.
3790 [
3791 (a) meets the requirements of Section 31A-37-402; and
3792 (b) is approved by the commissioner to:
3793 (i) provide all or part of the capital and surplus required by applicable law in an amount
3794 of not less than $350,000, which amount the commissioner may increase by order if the
3795 commissioner considers it necessary; and
3796 (ii) organize and operate a sponsored captive insurance company.
3797 [
3798 company:
3799 (a) in which the minimum capital and surplus required by applicable law is provided by
3800 one or more sponsors;
3801 (b) that is formed or holding a certificate of authority under this chapter;
3802 (c) that insures the risks of a separate participant through the contract; and
3803 (d) that segregates each participant's liability through one or more protected cells.
3804 [
3805 published in the Wall Street Journal as of a balance sheet date.
3806 Section 39. Section 31A-37-103 is amended to read:
3807 31A-37-103. Chapter exclusivity.
3808 (1) Except as provided in Subsections (2) and (3) or otherwise provided in this chapter,
3809 a provision of this title other than this chapter does not apply to a captive insurance company.
3810 (2) To the extent that a provision of the following does not contradict this chapter, the
3811 provision applies to a captive insurance company that receives a certificate of authority under
3812 this chapter:
3813 (a) Chapter 1, General Provisions;
3814 [
3815 [
3816 [
3817 [
3818 [
3819 [
3820 [
3821 [
3822 [
3823 [
3824 (3) In addition to this chapter, and subject to Section 31A-37a-103:
3825 (a) Chapter 37a, Special Purpose Financial Captive Insurance Company Act, applies to
3826 a special purpose financial captive insurance company; and
3827 (b) for purposes of a special purpose financial captive insurance company, a reference
3828 in this chapter to "this chapter" includes a reference to Chapter 37a, Special Purpose Financial
3829 Captive Insurance Company Act.
3830 (4) In addition to this chapter, an industrial group captive insurance company formed
3831 as a risk retention group captive is subject to Chapter 15, Part 2, Risk Retention Groups Act, to
3832 the extent that this chapter is silent regarding regulation of risk retention groups conducting
3833 business in the state.
3834 Section 40. Section 31A-37-106 is amended to read:
3835 31A-37-106. Authority to make rules -- Authority to issue orders.
3836 (1) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
3837 commissioner may adopt rules to:
3838 (a) determine circumstances under which a branch captive insurance company is not
3839 required to be a pure captive insurance company;
3840 (b) require a statement, document, or information that a captive insurance company
3841 shall provide to the commissioner to obtain a certificate of authority;
3842 (c) determine a factor a captive insurance company shall provide evidence of under
3843 Subsection [
3844 (d) prescribe one or more capital requirements for a captive insurance company in
3845 addition to those required under Section 31A-37-204 based on the type, volume, and nature of
3846 insurance business transacted by the captive insurance company;
3847 (e) waive or modify a requirement for public notice and hearing for the following by a
3848 captive insurance company:
3849 (i) merger;
3850 (ii) consolidation;
3851 (iii) conversion;
3852 (iv) mutualization;
3853 (v) redomestication; or
3854 (vi) acquisition;
3855 (f) approve the use of one or more reliable methods of valuation and rating for:
3856 (i) an association captive insurance company;
3857 (ii) a sponsored captive insurance company; or
3858 (iii) an industrial insured group;
3859 (g) prohibit or limit an investment that threatens the solvency or liquidity of:
3860 (i) a pure captive insurance company; or
3861 (ii) an industrial insured captive insurance company;
3862 (h) determine the financial reports a sponsored captive insurance company shall
3863 annually file with the commissioner;
3864 (i) prescribe the required forms and reports under Section 31A-37-501; [
3865 (j) establish one or more standards to ensure that:
3866 (i) one of the following is able to exercise control of the risk management function of a
3867 controlled unaffiliated business to be insured by a pure captive insurance company:
3868 (A) a parent; or
3869 (B) an affiliated company of a parent; or
3870 (ii) one of the following is able to exercise control of the risk management function of
3871 a controlled unaffiliated business to be insured by an industrial insured captive insurance
3872 company:
3873 (A) an industrial insured; or
3874 (B) an affiliated company of the industrial insured[
3875 (k) establish requirements for obtaining, maintaining, and renewing a certificate of
3876 dormancy.
3877 (2) Notwithstanding Subsection (1)(j), until the commissioner adopts the rules
3878 authorized under Subsection (1)(j), the commissioner may by temporary order grant authority
3879 to insure risks to:
3880 (a) a pure captive insurance company; or
3881 (b) an industrial insured captive insurance company.
3882 (3) The commissioner may issue prohibitory, mandatory, and other orders relating to a
3883 captive insurance company as necessary to enable the commissioner to secure compliance with
3884 this chapter.
3885 Section 41. Section 31A-37-201 is amended to read:
3886 31A-37-201. Certificate of authority.
3887 (1) The commissioner may issue a certificate of authority to act as an insurer in this
3888 state to a captive insurance company that meets the requirements of this chapter.
3889 (2) To conduct insurance business in this state, a captive insurance company shall:
3890 (a) obtain from the commissioner a certificate of authority authorizing it to conduct
3891 insurance business in this state;
3892 (b) hold at least once each year in the state a meeting of the governing body;
3893 (c) maintain in this state:
3894 (i) the principal place of business of the captive insurance company; or
3895 (ii) in the case of a branch captive insurance company, the principal place of business
3896 for the branch operations of the branch captive insurance company; and
3897 (d) except as provided in Subsection (3), appoint a resident registered agent to accept
3898 service of process and to otherwise act on behalf of the captive insurance company in the state.
3899 (3) In the case of a captive insurance company formed as a corporation, if the
3900 registered agent cannot with reasonable diligence be found at the registered office of the
3901 captive insurance company, the commissioner is the agent of the captive insurance company
3902 upon whom process, notice, or demand may be served.
3903 (4) (a) Before receiving a certificate of authority, an applicant captive insurance
3904 company shall file with the commissioner:
3905 (i) a certified copy of the captive insurance company's organizational charter;
3906 (ii) a statement under oath of the captive insurance company's president and secretary
3907 or their equivalents showing the captive insurance company's financial condition; and
3908 (iii) any other statement or document required by the commissioner under Section
3909 31A-37-106.
3910 (b) In addition to the information required under Subsection (4)(a), an applicant captive
3911 insurance company shall file with the commissioner evidence of:
3912 (i) the amount and liquidity of the assets of the applicant captive insurance company
3913 relative to the risks to be assumed by the applicant captive insurance company;
3914 (ii) the adequacy of the expertise, experience, and character of the person who will
3915 manage the applicant captive insurance company;
3916 (iii) the overall soundness of the plan of operation of the applicant captive insurance
3917 company;
3918 (iv) the adequacy of the loss prevention programs for the prospective insureds of the
3919 applicant captive insurance company as the commissioner deems necessary; and
3920 (v) any other factor the commissioner:
3921 (A) adopts by rule under Section 31A-37-106; and
3922 (B) considers relevant in ascertaining whether the applicant captive insurance company
3923 will be able to meet the policy obligations of the applicant captive insurance company.
3924 (c) In addition to the information required by Subsections (4)(a) and (b), an applicant
3925 sponsored captive insurance company shall file with the commissioner:
3926 (i) a business plan at the level of detail required by the commissioner under Section
3927 31A-37-106 demonstrating:
3928 (A) the manner in which the applicant sponsored captive insurance company will
3929 account for the losses and expenses of each protected cell; and
3930 (B) the manner in which the applicant sponsored captive insurance company will report
3931 to the commissioner the financial history, including losses and expenses, of each protected cell;
3932 (ii) a statement acknowledging that the applicant sponsored captive insurance company
3933 will make all financial records of the applicant sponsored captive insurance company,
3934 including records pertaining to a protected cell, available for inspection or examination by the
3935 commissioner;
3936 (iii) a contract or sample contract between the applicant sponsored captive insurance
3937 company and a participant; and
3938 (iv) evidence that expenses will be allocated to each protected cell in an equitable
3939 manner.
3940 (5) (a) Information submitted pursuant to this section is classified as a protected record
3941 under Title 63G, Chapter 2, Government Records Access and Management Act.
3942 (b) Notwithstanding Title 63G, Chapter 2, Government Records Access and
3943 Management Act, the commissioner may disclose information submitted pursuant to this
3944 section to a public official having jurisdiction over the regulation of insurance in another state
3945 if:
3946 (i) the public official receiving the information agrees in writing to maintain the
3947 confidentiality of the information; and
3948 (ii) the laws of the state in which the public official serves require the information to be
3949 confidential.
3950 (c) This Subsection (5) does not apply to information provided by an industrial insured
3951 captive insurance company insuring the risks of an industrial insured group.
3952 (6) (a) A captive insurance company shall pay to the department the following
3953 nonrefundable fees established by the department under Sections 31A-3-103, 31A-3-304, and
3954 63J-1-504:
3955 (i) a fee for examining, investigating, and processing, by a department employee, of an
3956 application for a certificate of authority made by an applicant captive insurance company;
3957 (ii) a fee for obtaining a certificate of authority for the year the captive insurance
3958 company is issued a certificate of authority by the department; and
3959 (iii) a certificate of authority renewal fee, assessed annually.
3960 (b) The commissioner may:
3961 (i) assign a department employee or retain legal, financial, or examination services
3962 from outside the department to perform the services described in:
3963 (A) Subsection (6)(a); and
3964 (B) Section 31A-37-502; and
3965 (ii) charge the reasonable cost of services described in Subsection (6)(b)(i) to the
3966 applicant captive insurance company.
3967 (7) If the commissioner is satisfied that the documents and statements filed by the
3968 applicant captive insurance company comply with this chapter, the commissioner may grant a
3969 certificate of authority authorizing the company to do insurance business in this state.
3970 (8) A certificate of authority granted under this section expires annually and shall be
3971 renewed by July 1 of each year.
3972 Section 42. Section 31A-37-202 is repealed and reenacted to read:
3973 31A-37-202. Permissive areas of insurance.
3974 (1) Except as provided in Subsection (2), a captive insurance company may not directly
3975 insure a risk other than the risk of the captive insurance company's parent or affiliated
3976 organization.
3977 (2) The following may insure a risk of a controlled unaffiliated business:
3978 (a) an industrial insured captive insurance company;
3979 (b) a protected cell;
3980 (c) a pure captive insurance company; or
3981 (d) a sponsored captive insurance company.
3982 (3) To the extent allowed by a captive insurance company's organizational charter, a
3983 captive insurance company may provide any type of insurance described in this title, except:
3984 (a) workers' compensation insurance;
3985 (b) personal motor vehicle insurance;
3986 (c) homeowners' insurance; and
3987 (d) any component of the types of insurance described in Subsections (3)(a) through
3988 (c).
3989 (4) A captive insurance company may not provide coverage for:
3990 (a) a wager or gaming risk;
3991 (b) loss of an election;
3992 (c) the penal consequences of a crime; or
3993 (d) punitive damages.
3994 Section 43. Section 31A-37-203 is amended to read:
3995 31A-37-203. Deceptive name prohibited.
3996 (1) A captive insurance company may not adopt a name that is:
3997 [
3998 [
3999 or
4000 [
4001 [
4002 [
4003 (2) An applicant captive insurance company that submits an application for a certificate
4004 of authority on or after May 14, 2019, or a captive insurance company that changes its name on
4005 or after May 14, 2019, shall include the work "insurance" or a term of equivalent meaning in its
4006 name.
4007 Section 44. Section 31A-37-301 is amended to read:
4008 31A-37-301. Formation.
4009 (1) A [
4010
4011
4012 captive insurance company, may be formed as a corporation or a limited liability company.
4013 [
4014 [
4015
4016 [
4017
4018
4019 [
4020 [
4021
4022 [
4023
4024 [
4025
4026 [
4027 [
4028
4029 [
4030
4031
4032 [
4033
4034 [
4035 [
4036
4037 (2) The capital of a captive insurance company shall be held by:
4038 (a) the interest holders of the captive insurance company; or
4039 (b) a governing body elected by:
4040 (i) the insureds;
4041 (ii) one or more affiliates; or
4042 (iii) a combination of the persons described in Subsections (2)(b)(i) and (ii).
4043 [
4044
4045 least one establisher who is an individual and at least one establisher who is an individual and a
4046 resident of the state.
4047 [
4048
4049 [
4050
4051
4052
4053
4054 (4) (a) An applicant captive insurance company's establishers shall obtain a certificate
4055 of public good from the commissioner before filing its governing documents with the Division
4056 of Corporations and Commercial Code.
4057 (b) In considering a request for a certificate under Subsection [
4058 commissioner shall consider:
4059 (i) the character, reputation, financial standing, and purposes of the [
4060 establishers;
4061 (ii) the character, reputation, financial responsibility, insurance experience, and
4062 business qualifications of the principal officers [
4063 body;
4064 (iii) any information in:
4065 (A) the application for a certificate of authority; or
4066 (B) the department's files; and
4067 (iv) other aspects that the commissioner considers advisable.
4068 [
4069
4070
4071
4072
4073 [
4074
4075 [
4076 [
4077
4078 [
4079 [
4080 [
4081 [
4082 [
4083
4084 [
4085 [
4086 [
4087 [
4088
4089
4090 [
4091
4092 [
4093 [
4094 [
4095 [
4096
4097
4098 [
4099
4100
4101 [
4102
4103 [
4104 [
4105
4106 [
4107 [
4108 [
4109 [
4110 [
4111
4112
4113 [
4114
4115
4116 [
4117
4118
4119
4120 [
4121
4122
4123 [
4124
4125 [
4126
4127 (5) (a) Except as otherwise provided in this title, the governing body of a captive
4128 insurance company shall consist of at least three individuals as members, at least one of whom
4129 is a resident of the state.
4130 (b) One-third of the members of the governing body of a captive insurance company
4131 constitutes a quorum of the governing body.
4132 (6) A captive insurance company shall have at least three individuals as principal
4133 officers with duties comparable to those of president, treasurer, and secretary.
4134 [
4135
4136
4137 Chapter 10a, Utah Revised Business Corporation Act, and this chapter. If a conflict exists
4138 between a provision of [
4139 Business Corporation Act, and a provision of this chapter, this chapter [
4140 (b) A captive insurance company formed as a limited liability company is subject to the
4141 provisions of Title 48, Chapter 3a, Utah Revised Uniform Limited Liability Company Act, and
4142 this chapter. If a conflict exists between a provision of Title 48, Chapter 3a, Utah Revised
4143 Uniform Limited Liability Company Act, and a provision of this chapter, this chapter controls.
4144 (c) Except as provided in Subsection [
4145 [
4146 redomestication apply [
4147 company in carrying out any of the transactions described in those provisions.
4148 (d) Notwithstanding Subsection [
4149 the requirements for public notice and hearing in accordance with rules adopted under Section
4150 31A-37-106.
4151 (e) If a notice of public hearing is required, but no one requests a hearing, the
4152 commissioner may cancel the public hearing.
4153 [
4154
4155
4156 [
4157
4158 [
4159
4160
4161
4162 [
4163
4164
4165 [
4166
4167 [
4168
4169
4170
4171 [
4172
4173
4174 Section 45. Section 31A-37-401 is amended to read:
4175 31A-37-401. Sponsored captive insurance companies -- Formation.
4176 (1) One or more sponsors may form a sponsored captive insurance company under this
4177 chapter.
4178 (2) A sponsored captive insurance company formed under this chapter may establish
4179 and maintain a protected cell to insure risks of a participant if:
4180 (a) the [
4181 limited to:
4182 (i) the participants of the sponsored captive insurance company; and
4183 (ii) the sponsors of the sponsored captive insurance company;
4184 (b) each protected cell is accounted for separately on the books and records of the
4185 sponsored cell captive insurance company to reflect:
4186 (i) the financial condition of each individual protected cell;
4187 (ii) the results of operations of each individual protected cell;
4188 (iii) the net income or loss of each individual protected cell;
4189 (iv) the dividends or other distributions to participants of each individual protected
4190 cell; and
4191 (v) other factors that may be:
4192 (A) provided in the participant contract; or
4193 (B) required by the commissioner;
4194 (c) the assets of a protected cell are not chargeable with liabilities arising out of any
4195 other insurance business the sponsored captive insurance company may conduct;
4196 (d) a sale, exchange, or other transfer of assets is not made by the sponsored captive
4197 insurance company between or among any of the protected cells of the sponsored captive
4198 insurance company without the consent of the protected cells;
4199 (e) a sale, exchange, transfer of assets, dividend, or distribution is not made from a
4200 protected cell to a sponsor or participant without the commissioner's approval, which may not
4201 be given if the sale, exchange, transfer, dividend, or distribution would result in insolvency or
4202 impairment with respect to a protected cell;
4203 (f) a sponsored captive insurance company annually files with the commissioner
4204 financial reports the commissioner requires under Section 31A-37-106, including accounting
4205 statements detailing the financial experience of each protected cell;
4206 (g) a sponsored captive insurance company notifies the commissioner in writing within
4207 10 business days of a protected cell that is insolvent or otherwise unable to meet the claim or
4208 expense obligations of the protected cell;
4209 (h) a participant contract does not take effect without the commissioner's prior written
4210 approval;
4211 (i) the addition of each new protected cell and withdrawal of a participant of any
4212 existing protected cell does not take effect without the commissioner's prior written approval;
4213 and
4214 (j) (i) a protected cell captive insurance company shall pay to the department the
4215 following nonrefundable fees established by the department under Sections 31A-3-103,
4216 31A-3-304, and 63J-1-504:
4217 (A) a fee for examining, investigating, and processing by a department employee of an
4218 application for a certificate of authority made by a protected cell captive insurance company;
4219 (B) a fee for obtaining a certificate of authority for the year the protected cell captive
4220 insurance company is issued a certificate of authority by the department; and
4221 (C) a certificate of authority renewal fee; and
4222 (ii) a protected cell may be created by the sponsor or the sponsor may create a pooling
4223 insurance arrangement to provide for pooling of risks to allow for risk distribution upon written
4224 approval from every protected cell under the sponsor and written approval of the
4225 commissioner.
4226 Section 46. Section 31A-37-501 is amended to read:
4227 31A-37-501. Reports to commissioner.
4228 (1) A captive insurance company is not required to make a report except those
4229 provided in this chapter.
4230 (2) (a) Before March 1 of each year, a captive insurance company shall submit to the
4231 commissioner a report of the financial condition of the captive insurance company, verified by
4232 oath of [
4233 company.
4234 (b) Except as provided in Section 31A-37-204, a captive insurance company shall
4235 report:
4236 (i) using generally accepted accounting principles, except to the extent that the
4237 commissioner requires, approves, or accepts the use of a statutory accounting principle;
4238 (ii) using a useful or necessary modification or adaptation to an accounting principle
4239 that is required, approved, or accepted by the commissioner for the type of insurance and kind
4240 of insurer to be reported upon; and
4241 (iii) supplemental or additional information required by the commissioner.
4242 (c) Except as otherwise provided:
4243 (i) a licensed captive insurance company shall file the report required by Section
4244 31A-4-113; and
4245 (ii) an industrial insured group shall comply with Section 31A-4-113.5.
4246 (3) (a) A pure captive insurance company may make written application to file the
4247 required report on a fiscal year end that is consistent with the fiscal year of the parent company
4248 of the pure captive insurance company.
4249 (b) If the commissioner grants an alternative reporting date for a pure captive insurance
4250 company requested under Subsection (3)(a), the annual report is due 60 days after the fiscal
4251 year end.
4252 (4) (a) Sixty days after the fiscal year end, a branch captive insurance company shall
4253 file with the commissioner a copy of the reports and statements required to be filed under the
4254 laws of the jurisdiction in which the alien captive insurance company is formed, verified by
4255 oath by two of the alien captive insurance company's executive officers.
4256 (b) If the commissioner is satisfied that the annual report filed by the alien captive
4257 insurance company in the jurisdiction in which the alien captive insurance company is formed
4258 provides adequate information concerning the financial condition of the alien captive insurance
4259 company, the commissioner may waive the requirement for completion of the annual statement
4260 required for a captive insurance company under this section with respect to business written in
4261 the alien or foreign jurisdiction.
4262 (c) A waiver by the commissioner under Subsection (4)(b):
4263 (i) shall be in writing; and
4264 (ii) is subject to public inspection.
4265 (5) Before March 1 of each year, a sponsored cell captive insurance company shall
4266 submit to the commissioner a consolidated report of the financial condition of each individual
4267 protected cell, including a financial statement for each protected cell.
4268 (6) (a) A captive insurance company shall notify the commissioner in writing if there
4269 is:
4270 (i) a material change to the captive insurance company's most recently filed report of
4271 financial condition; or
4272 (ii) an adverse material change in the financial condition of a captive insurance
4273 company since the captive insurance company's most recently filed report of financial
4274 condition.
4275 (b) A captive insurance company shall submit a notification described in this
4276 subsection within 20 days after the day on which the captive insurance company learns of the
4277 material change.
4278 Section 47. Section 31A-37-502 is amended to read:
4279 31A-37-502. Examination.
4280 (1) (a) As provided in this section, the commissioner, or a person appointed by the
4281 commissioner, shall examine each captive insurance company in each five-year period.
4282 (b) The five-year period described in Subsection (1)(a) shall be determined on the basis
4283 of five full annual accounting periods of operation.
4284 (c) The examination is to be made as of:
4285 (i) December 31 of the full five-year period; or
4286 (ii) the last day of the month of an annual accounting period authorized for a captive
4287 insurance company under this section.
4288 (d) In addition to an examination required under this Subsection (1), the commissioner,
4289 or a person appointed by the commissioner may examine a captive insurance company
4290 whenever the commissioner determines it to be prudent.
4291 (2) During an examination under this section the commissioner, or a person appointed
4292 by the commissioner, shall thoroughly inspect and examine the affairs of the captive insurance
4293 company to ascertain:
4294 (a) the financial condition of the captive insurance company;
4295 (b) the ability of the captive insurance company to fulfill the obligations of the captive
4296 insurance company; and
4297 (c) whether the captive insurance company has complied with this chapter.
4298 (3) The commissioner may accept a comprehensive annual independent audit in lieu of
4299 an examination:
4300 (a) of a scope satisfactory to the commissioner; and
4301 (b) performed by an independent auditor approved by the commissioner.
4302 (4) A captive insurance company that is inspected and examined under this section
4303 shall pay, as provided in Subsection [
4304 of an inspection and examination.
4305 Section 48. Section 31A-37-701 is enacted to read:
4306
4307 31A-37-701. Certificate of dormancy.
4308 (1) In accordance with the provisions of this section, a captive insurance company,
4309 other than a risk retention group may apply, without fee, to the commissioner for a certificate
4310 of dormancy.
4311 (2) (a) A captive insurance company, other than a risk retention group, is eligible for a
4312 certificate of dormancy if the captive insurance company:
4313 (i) has ceased transacting the business of insurance, including the issuance of insurance
4314 policies; and
4315 (ii) has no remaining insurance liabilities or obligations associated with insurance
4316 business transactions or insurance policies.
4317 (b) For purposes of Subsection (2)(a)(ii), the commissioner may disregard liabilities or
4318 obligations for which the captive insurance company has withheld sufficient funds or that are
4319 otherwise sufficiently secured.
4320 (3) Except as provided in Subsection (5), a captive insurance company that holds a
4321 certificate of dormancy is subject to all requirements of this chapter.
4322 (4) A captive insurance company that holds a certificate of dormancy:
4323 (a) shall possess and maintain unimpaired paid-in capital and unimpaired paid-in
4324 surplus of:
4325 (i) in the case of a pure captive insurance company or a special purpose captive
4326 insurance company, not less than $25,000;
4327 (ii) in the case of an association captive insurance company, not less than $75,000; or
4328 (iii) in the case of a sponsored captive insurance company, not less than $100,000, of
4329 which at least $35,000 is provided by the sponsor; and
4330 (b) is not required to:
4331 (i) subject to Subsection (5), submit an annual audit or statement of actuarial opinion;
4332 (ii) maintain an active agreement with an independent auditor or actuary; or
4333 (iii) hold an annual meeting of the captive insurance company in the state.
4334 (5) The commissioner may require a captive insurance company that holds a certificate
4335 of dormancy to submit an annual audit if the commissioner determines that there are concerns
4336 regarding the captive insurance company's solvency or liquidity.
4337 (6) To maintain a certificate of dormancy and in lieu of a certificate of authority
4338 renewal fee, no later than July 1 of each year, a captive insurance company shall pay an annual
4339 dormancy renewal fee that is equal to 50% of the captive insurance's company's certificate of
4340 authority renewal fee.
4341 (7) A captive insurance company may consecutively renew a certificate or dormancy
4342 no more than five times.
4343 Section 49. Section 31A-37-702 is enacted to read:
4344 31A-37-702. Cancelling a certificate of dormancy.
4345 A captive insurance company may apply to cancel its certificate of dormancy by
4346 complying with the procedures established in rule made by the commissioner in accordance
4347 with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
4348 Section 50. Section 31A-45-102 is amended to read:
4349 31A-45-102. Definitions.
4350 As used in this chapter:
4351 (1) "Covered benefit" or "benefit" means the health care services to which a covered
4352 person is entitled under the terms of a health [
4353 managed care organization.
4354 (2) "Managed care organization" means:
4355 (a) a managed care organization as that term is defined in Section 31A-1-301; and
4356 (b) a third party administrator as that term is defined in Section 31A-1-301.
4357 Section 51. Section 31A-45-303 is amended to read:
4358 31A-45-303. Network provider contract provisions.
4359 (1) Managed care organizations may provide for enrollees to receive services or
4360 reimbursement [
4361 (2) (a) Subject to restrictions under this section, a managed care organization may enter
4362 into contracts with health care providers under which the health care providers agree to be a
4363 network provider and supply services, at prices specified in the contracts, to enrollees.
4364 (b) A network provider contract shall require the network provider to accept the
4365 specified payment in this Subsection (2) as payment in full, relinquishing the right to collect
4366 amounts other than copayments, coinsurance, and deductibles from the enrollee.
4367 (c) The insurance contract may reward the enrollee for selection of network providers
4368 by:
4369 (i) reducing premium rates;
4370 (ii) reducing deductibles;
4371 (iii) coinsurance;
4372 (iv) other copayments; or
4373 (v) any other reasonable manner.
4374 (3) (a) When reimbursing for services of health care providers that are not network
4375 providers, the managed care organization may:
4376 (i) make direct payment to the enrollee; and
4377 (ii) impose a deductible on coverage of health care providers not under contract.
4378 (b) (i) Subsections (3)(b)(iii) and (c) apply to a managed care organization licensed
4379 under:
4380 (A) Chapter 5, Domestic Stock and Mutual Insurance Corporations;
4381 (B) Chapter 7, Nonprofit Health Service Insurance Corporations; or
4382 (C) Chapter 14, Foreign Insurers; and
4383 (ii) Subsections (3)(b)(iii) and (c) and Subsection (6)(b) do not apply to a managed care
4384 organization licensed under Chapter 8, Health Maintenance Organizations and Limited Health
4385 Plans.
4386 (iii) When selecting health care providers with whom to contract under Subsection (2),
4387 a managed care organization described in Subsection (3)(b)(i) may not unfairly discriminate
4388 between classes of health care providers, but may discriminate within a class of health care
4389 providers, subject to Subsection (6).
4390 (c) For purposes of this section, unfair discrimination between classes of health care
4391 providers includes:
4392 (i) refusal to contract with class members in reasonable proportion to the number of
4393 insureds covered by the insurer and the expected demand for services from class members; and
4394 (ii) refusal to cover procedures for one class of providers that are:
4395 (A) commonly used by members of the class of health care providers for the treatment
4396 of illnesses, injuries, or conditions;
4397 (B) otherwise covered by the managed care organization; and
4398 (C) within the scope of practice of the class of health care providers.
4399 (4) Before the enrollee consents to the insurance contract, the managed care
4400 organization shall fully disclose to the enrollee that the managed care organization has entered
4401 into network provider contracts. The managed care organization shall provide sufficient detail
4402 on the network provider contracts to permit the enrollee to agree to the terms of the insurance
4403 contract. The managed care organization shall provide at least the following information:
4404 (a) a list of the health care providers under contract, and if requested their business
4405 locations and specialties;
4406 (b) a description of the insured benefits, including deductibles, coinsurance, or other
4407 copayments;
4408 (c) a description of the quality assurance program required under Subsection (5); and
4409 (d) a description of the adverse benefit determination procedures required under
4410 Section 31A-22-629.
4411 (5) (a) A managed care organization using network provider contracts shall maintain a
4412 quality assurance program for assuring that the care provided by the network providers meets
4413 prevailing standards in the state.
4414 (b) The commissioner in consultation with the executive director of the Department of
4415 Health may designate qualified persons to perform an audit of the quality assurance program.
4416 The auditors shall have full access to all records of the managed care organization and the
4417 managed care organization's health care providers, including medical records of individual
4418 patients.
4419 (c) The information contained in the medical records of individual patients shall
4420 remain confidential. All information, interviews, reports, statements, memoranda, or other data
4421 furnished for purposes of the audit and any findings or conclusions of the auditors are
4422 privileged. The information is not subject to discovery, use, or receipt in evidence in any legal
4423 proceeding except hearings before the commissioner concerning alleged violations of this
4424 section.
4425 (6) (a) A health care provider or managed care organization may not discriminate
4426 against a network provider for agreeing to a contract under Subsection (2).
4427 (b) (i) Subsections (6)(b) and (c) apply to a managed care organization that is described
4428 in Subsection (3)(b)(i) and do not apply to a managed care organization described in
4429 Subsection (3)(b)(ii).
4430 (ii) A health care provider licensed to treat an illness or injury within the scope of the
4431 health care provider's practice, that is willing and able to meet the terms and conditions
4432 established by the managed care organization for designation as a network provider, shall be
4433 able to apply for and receive the designation as a network provider. Contract terms and
4434 conditions may include reasonable limitations on the number of designated network providers
4435 based upon substantial objective and economic grounds, or expected use of particular services
4436 based upon prior provider-patient profiles.
4437 (c) Upon the written request of a provider excluded from a network provider contract,
4438 the commissioner may hold a hearing to determine if the managed care organization's exclusion
4439 of the provider is based on the criteria set forth in Subsection (6)(b).
4440 (7) Nothing in this section is to be construed as to require a managed care organization
4441 to offer a certain benefit or service as part of a health benefit plan.
4442 (8) Notwithstanding Subsection (2) or [
4443 organization described in Subsection (3)(b)(i) or third party administrator is not required to, but
4444 may, enter into a contract with a licensed athletic trainer, licensed under Title 58, Chapter 40a,
4445 Athletic Trainer Licensing Act.
4446 Section 52. Section 31A-45-401 is amended to read:
4447 31A-45-401. Court ordered coverage for minor children who reside outside the
4448 service area.
4449 (1) (a) The requirements of Subsection (2) apply to a managed care organization if the
4450 managed care organization [
4451 (i) restricts coverage for nonemergency services to services provided by contracted
4452 providers within the organization's service area; and
4453 (ii) does not offer a benefit that permits members the option of obtaining covered
4454 services from a non-network provider.
4455 (b) The requirements of Subsection (2) do not apply to a managed care organization if:
4456 (i) the child [
4457 [
4458 (ii) a parent's employer offers the parent a choice to select health insurance coverage
4459 that is not a managed care organization plan either at the time of the court or administrative
4460 support order, or at a subsequent open enrollment period. This exemption from Subsection (2)
4461 applies even if the parent ultimately chooses the managed care organization plan.
4462 (2) If a parent is required by a court or administrative support order to provide health
4463 insurance coverage for a child who resides outside of a managed care organization's service
4464 area, the managed care organization shall:
4465 (a) comply with the provisions of Section 31A-22-610.5;
4466 (b) allow the enrollee parent to enroll the child on the organization plan;
4467 (c) pay for otherwise covered health care services rendered to the child outside of the
4468 service area by a non-network provider:
4469 (i) if the child, noncustodial parent, or custodial parent has complied with prior
4470 authorization or utilization review otherwise required by the organization; and
4471 (ii) in an amount equal to the dollar amount the organization pays under a noncapitated
4472 arrangement for comparable services to a network provider in the same class of health care
4473 providers as the provider who rendered the services; and
4474 (d) make payments on claims submitted in accordance with Subsection (2)(c) directly
4475 to the provider, custodial parent, the child who obtained benefits, or state Medicaid agency.
4476 (3) (a) The parents of the child who is the subject of the court or administrative support
4477 order are responsible for any charges billed by the provider in excess of those paid by the
4478 organization.
4479 (b) This section does not affect any court or administrative order regarding the
4480 responsibilities between the parents to pay any medical expenses not covered by accident and
4481 health insurance or a managed care organization plan.
4482 (4) The commissioner shall adopt rules as necessary to administer this section and
4483 Section 31A-22-610.5.
4484 Section 53. Section 34A-2-110 is amended to read:
4485 34A-2-110. Workers' compensation insurance fraud -- Elements -- Penalties --
4486 Notice.
4487 (1) As used in this section:
4488 (a) "Corporation" has the same meaning as in Section 76-2-201.
4489 (b) "Intentionally" has the same meaning as in Section 76-2-103.
4490 (c) "Knowingly" has the same meaning as in Section 76-2-103.
4491 (d) "Person" has the same meaning as in Section 76-1-601.
4492 (e) "Recklessly" has the same meaning as in Section 76-2-103.
4493 (f) "Thing of value" means one or more of the following obtained under this chapter or
4494 Chapter 3, Utah Occupational Disease Act:
4495 (i) workers' compensation insurance coverage;
4496 (ii) disability compensation;
4497 (iii) a medical benefit;
4498 (iv) a good;
4499 (v) a professional service;
4500 (vi) a fee for a professional service; or
4501 (vii) anything of value.
4502 (2) (a) A person is guilty of workers' compensation insurance fraud if that person
4503 intentionally, knowingly, or recklessly:
4504 (i) devises a scheme or artifice to do the following by means of a false or fraudulent
4505 pretense, representation, promise, or material omission:
4506 (A) obtain a thing of value under this chapter or Chapter 3, Utah Occupational Disease
4507 Act;
4508 (B) avoid paying the premium that an insurer charges, for an employee on the basis of
4509 the underwriting criteria applicable to that employee, to obtain a thing of value under this
4510 chapter or Chapter 3, Utah Occupational Disease Act; or
4511 (C) deprive an employee of a thing of value under this chapter or Chapter 3, Utah
4512 Occupational Disease Act; and
4513 (ii) communicates or causes a communication with another in furtherance of the
4514 scheme or artifice.
4515 (b) A violation of this Subsection (2) includes a scheme or artifice to:
4516 (i) make or cause to be made a false written or oral statement with the intent to obtain
4517 insurance coverage as mandated by this chapter or Chapter 3, Utah Occupational Disease Act,
4518 at a rate that does not reflect the risk, industry, employer, or class code actually covered by the
4519 insurance coverage;
4520 (ii) form a business, reorganize a business, or change ownership in a business with the
4521 intent to:
4522 (A) obtain insurance coverage as mandated by this chapter or Chapter 3, Utah
4523 Occupational Disease Act, at a rate that does not reflect the risk, industry, employer, or class
4524 code actually covered by the insurance coverage;
4525 (B) misclassify an employee as described in Subsection (2)(b)(iii); or
4526 (C) deprive an employee of workers' compensation coverage as required by Subsection
4527 34A-2-103(8);
4528 (iii) misclassify an employee as one of the following so as to avoid the obligation to
4529 obtain insurance coverage as mandated by this chapter or Chapter 3, Utah Occupational
4530 Disease Act:
4531 (A) an independent contractor;
4532 (B) a sole proprietor;
4533 (C) an owner;
4534 (D) a partner;
4535 (E) an officer; or
4536 (F) a member in a limited liability company;
4537 (iv) use a workers' compensation coverage waiver issued under Part 10, Workers'
4538 Compensation Coverage Waivers Act, to deprive an employee of workers' compensation
4539 coverage under this chapter or Chapter 3, Utah Occupational Disease Act; or
4540 (v) collect or make a claim for temporary disability compensation as provided in
4541 Section 34A-2-410 while working for gain.
4542 (3) (a) Workers' compensation insurance fraud under Subsection (2) is punishable in
4543 the manner prescribed in Subsection (3)(c).
4544 (b) A corporation or association is guilty of the offense of workers' compensation
4545 insurance fraud under the same conditions as those set forth in Section 76-2-204.
4546 (c) (i) In accordance with Subsection (3)(c)(ii), the determination of the degree of an
4547 offense under Subsection (2) shall be measured by the following on the basis of which creates
4548 the greatest penalty:
4549 (A) the total value of all property, money, or other things obtained or sought to be
4550 obtained by the scheme or artifice described in Subsection (2); or
4551 (B) the number of individuals not covered under this chapter or Chapter 3, Utah
4552 Occupational Disease Act, because of the scheme or artifice described in Subsection (2).
4553 (ii) A person is guilty of:
4554 (A) a class A misdemeanor:
4555 (I) if the value of the property, money, or other thing of value described in Subsection
4556 (3)(c)(i)(A) is less than $1,000; or
4557 (II) for each individual described in Subsection (3)(c)(i)(B), if the number of
4558 individuals described in Subsection (3)(c)(i)(B) is less than five;
4559 (B) a third degree felony:
4560 (I) if the value of the property, money, or other thing of value described in Subsection
4561 (3)(c)(i)(A) is equal to or greater than $1,000, but is less than $5,000; or
4562 (II) for each individual described in Subsection (3)(c)(i)(B), if the number of
4563 individuals described in Subsection (3)(c)(i)(B) is equal to or greater than five, but is less than
4564 50; and
4565 (C) a second degree felony:
4566 (I) if the value of the property, money, or other thing of value described in Subsection
4567 (3)(c)(i)(A) is equal to or greater than $5,000; or
4568 (II) for each individual described in Subsection (3)(c)(i)(B), if the number of
4569 individuals described in Subsection (3)(c)(i)(B) is equal to or greater than 50.
4570 (4) The following are not a necessary element of an offense described in Subsection
4571 (2):
4572 (a) reliance on the part of a person;
4573 (b) the intent on the part of the perpetrator of an offense described in Subsection (2) to
4574 permanently deprive a person of property, money, or anything of value; or
4575 (c) an insurer or self-insured employer giving written notice in accordance with
4576 Subsection (5) that workers' compensation insurance fraud is a crime.
4577 (5) (a) An insurer or self-insured employer who, in connection with this chapter or
4578 Chapter 3, Utah Occupational Disease Act, prints, reproduces, or furnishes a form described in
4579 Subsection (5)(b) shall cause to be printed or displayed in comparative prominence with other
4580 content on the form the statement: "Any person who knowingly presents false or fraudulent
4581 underwriting information, files or causes to be filed a false or fraudulent claim for disability
4582 compensation or medical benefits, or submits a false or fraudulent report or billing for health
4583 care fees or other professional services is guilty of a crime and may be subject to fines and
4584 confinement in state prison."
4585 (b) Subsection (5)(a) applies to a form upon which a person:
4586 (i) applies for insurance coverage;
4587 (ii) applies for a workers' compensation coverage waiver issued under Part 10,
4588 Workers' Compensation Coverage Waivers Act;
4589 (iii) reports payroll;
4590 (iv) makes a claim by reason of accident, injury, death, disease, or other claimed loss;
4591 or
4592 (v) makes a report or gives notice to an insurer or self-insured employer.
4593 (c) An insurer or self-insured employer who issues a check, warrant, or other financial
4594 instrument in payment of compensation issued under this chapter or Chapter 3, Utah
4595 Occupational Disease Act, shall cause to be printed or displayed in comparative prominence
4596 above the area for endorsement a statement substantially similar to the following: "Workers'
4597 compensation insurance fraud is a crime punishable by Utah law."
4598 (d) This Subsection (5) applies only to the legal obligations of an insurer or a
4599 self-insured employer.
4600 (e) A person who violates Subsection (2) is guilty of workers' compensation insurance
4601 fraud, and the failure of an insurer or a self-insured employer to fully comply with this
4602 Subsection (5) is not:
4603 (i) a defense to violating Subsection (2); or
4604 (ii) grounds for suppressing evidence.
4605 (6) In the absence of malice, a person, employer, insurer, or governmental entity that
4606 reports a suspected fraudulent act relating to a workers' compensation insurance policy or claim
4607 is not subject to civil liability for libel, slander, or another relevant cause of action.
4608 (7) (a) In an action involving workers' compensation, this section supersedes Title 31A,
4609 Chapter 31, Insurance Fraud Act.
4610 (b) Nothing in this section prohibits the Insurance Department from investigating
4611 violations of this section or from pursuing civil or criminal penalties for violations of this
4612 section in accordance with Section 31A-31-109 and this title.
4613 Section 54. Section 63G-2-305 is amended to read:
4614 63G-2-305. Protected records.
4615 The following records are protected if properly classified by a governmental entity:
4616 (1) trade secrets as defined in Section 13-24-2 if the person submitting the trade secret
4617 has provided the governmental entity with the information specified in Section 63G-2-309;
4618 (2) commercial information or nonindividual financial information obtained from a
4619 person if:
4620 (a) disclosure of the information could reasonably be expected to result in unfair
4621 competitive injury to the person submitting the information or would impair the ability of the
4622 governmental entity to obtain necessary information in the future;
4623 (b) the person submitting the information has a greater interest in prohibiting access
4624 than the public in obtaining access; and
4625 (c) the person submitting the information has provided the governmental entity with
4626 the information specified in Section 63G-2-309;
4627 (3) commercial or financial information acquired or prepared by a governmental entity
4628 to the extent that disclosure would lead to financial speculations in currencies, securities, or
4629 commodities that will interfere with a planned transaction by the governmental entity or cause
4630 substantial financial injury to the governmental entity or state economy;
4631 (4) records, the disclosure of which could cause commercial injury to, or confer a
4632 competitive advantage upon a potential or actual competitor of, a commercial project entity as
4633 defined in Subsection 11-13-103(4);
4634 (5) test questions and answers to be used in future license, certification, registration,
4635 employment, or academic examinations;
4636 (6) records, the disclosure of which would impair governmental procurement
4637 proceedings or give an unfair advantage to any person proposing to enter into a contract or
4638 agreement with a governmental entity, except, subject to Subsections (1) and (2), that this
4639 Subsection (6) does not restrict the right of a person to have access to, after the contract or
4640 grant has been awarded and signed by all parties:
4641 (a) a bid, proposal, application, or other information submitted to or by a governmental
4642 entity in response to:
4643 (i) an invitation for bids;
4644 (ii) a request for proposals;
4645 (iii) a request for quotes;
4646 (iv) a grant; or
4647 (v) other similar document; or
4648 (b) an unsolicited proposal, as defined in Section 63G-6a-712;
4649 (7) information submitted to or by a governmental entity in response to a request for
4650 information, except, subject to Subsections (1) and (2), that this Subsection (7) does not restrict
4651 the right of a person to have access to the information, after:
4652 (a) a contract directly relating to the subject of the request for information has been
4653 awarded and signed by all parties; or
4654 (b) (i) a final determination is made not to enter into a contract that relates to the
4655 subject of the request for information; and
4656 (ii) at least two years have passed after the day on which the request for information is
4657 issued;
4658 (8) records that would identify real property or the appraisal or estimated value of real
4659 or personal property, including intellectual property, under consideration for public acquisition
4660 before any rights to the property are acquired unless:
4661 (a) public interest in obtaining access to the information is greater than or equal to the
4662 governmental entity's need to acquire the property on the best terms possible;
4663 (b) the information has already been disclosed to persons not employed by or under a
4664 duty of confidentiality to the entity;
4665 (c) in the case of records that would identify property, potential sellers of the described
4666 property have already learned of the governmental entity's plans to acquire the property;
4667 (d) in the case of records that would identify the appraisal or estimated value of
4668 property, the potential sellers have already learned of the governmental entity's estimated value
4669 of the property; or
4670 (e) the property under consideration for public acquisition is a single family residence
4671 and the governmental entity seeking to acquire the property has initiated negotiations to acquire
4672 the property as required under Section 78B-6-505;
4673 (9) records prepared in contemplation of sale, exchange, lease, rental, or other
4674 compensated transaction of real or personal property including intellectual property, which, if
4675 disclosed prior to completion of the transaction, would reveal the appraisal or estimated value
4676 of the subject property, unless:
4677 (a) the public interest in access is greater than or equal to the interests in restricting
4678 access, including the governmental entity's interest in maximizing the financial benefit of the
4679 transaction; or
4680 (b) when prepared by or on behalf of a governmental entity, appraisals or estimates of
4681 the value of the subject property have already been disclosed to persons not employed by or
4682 under a duty of confidentiality to the entity;
4683 (10) records created or maintained for civil, criminal, or administrative enforcement
4684 purposes or audit purposes, or for discipline, licensing, certification, or registration purposes, if
4685 release of the records:
4686 (a) reasonably could be expected to interfere with investigations undertaken for
4687 enforcement, discipline, licensing, certification, or registration purposes;
4688 (b) reasonably could be expected to interfere with audits, disciplinary, or enforcement
4689 proceedings;
4690 (c) would create a danger of depriving a person of a right to a fair trial or impartial
4691 hearing;
4692 (d) reasonably could be expected to disclose the identity of a source who is not
4693 generally known outside of government and, in the case of a record compiled in the course of
4694 an investigation, disclose information furnished by a source not generally known outside of
4695 government if disclosure would compromise the source; or
4696 (e) reasonably could be expected to disclose investigative or audit techniques,
4697 procedures, policies, or orders not generally known outside of government if disclosure would
4698 interfere with enforcement or audit efforts;
4699 (11) records the disclosure of which would jeopardize the life or safety of an
4700 individual;
4701 (12) records the disclosure of which would jeopardize the security of governmental
4702 property, governmental programs, or governmental recordkeeping systems from damage, theft,
4703 or other appropriation or use contrary to law or public policy;
4704 (13) records that, if disclosed, would jeopardize the security or safety of a correctional
4705 facility, or records relating to incarceration, treatment, probation, or parole, that would interfere
4706 with the control and supervision of an offender's incarceration, treatment, probation, or parole;
4707 (14) records that, if disclosed, would reveal recommendations made to the Board of
4708 Pardons and Parole by an employee of or contractor for the Department of Corrections, the
4709 Board of Pardons and Parole, or the Department of Human Services that are based on the
4710 employee's or contractor's supervision, diagnosis, or treatment of any person within the board's
4711 jurisdiction;
4712 (15) records and audit workpapers that identify audit, collection, and operational
4713 procedures and methods used by the State Tax Commission, if disclosure would interfere with
4714 audits or collections;
4715 (16) records of a governmental audit agency relating to an ongoing or planned audit
4716 until the final audit is released;
4717 (17) records that are subject to the attorney client privilege;
4718 (18) records prepared for or by an attorney, consultant, surety, indemnitor, insurer,
4719 employee, or agent of a governmental entity for, or in anticipation of, litigation or a judicial,
4720 quasi-judicial, or administrative proceeding;
4721 (19) (a) (i) personal files of a state legislator, including personal correspondence to or
4722 from a member of the Legislature; and
4723 (ii) notwithstanding Subsection (19)(a)(i), correspondence that gives notice of
4724 legislative action or policy may not be classified as protected under this section; and
4725 (b) (i) an internal communication that is part of the deliberative process in connection
4726 with the preparation of legislation between:
4727 (A) members of a legislative body;
4728 (B) a member of a legislative body and a member of the legislative body's staff; or
4729 (C) members of a legislative body's staff; and
4730 (ii) notwithstanding Subsection (19)(b)(i), a communication that gives notice of
4731 legislative action or policy may not be classified as protected under this section;
4732 (20) (a) records in the custody or control of the Office of Legislative Research and
4733 General Counsel, that, if disclosed, would reveal a particular legislator's contemplated
4734 legislation or contemplated course of action before the legislator has elected to support the
4735 legislation or course of action, or made the legislation or course of action public; and
4736 (b) notwithstanding Subsection (20)(a), the form to request legislation submitted to the
4737 Office of Legislative Research and General Counsel is a public document unless a legislator
4738 asks that the records requesting the legislation be maintained as protected records until such
4739 time as the legislator elects to make the legislation or course of action public;
4740 (21) research requests from legislators to the Office of Legislative Research and
4741 General Counsel or the Office of the Legislative Fiscal Analyst and research findings prepared
4742 in response to these requests;
4743 (22) drafts, unless otherwise classified as public;
4744 (23) records concerning a governmental entity's strategy about:
4745 (a) collective bargaining; or
4746 (b) imminent or pending litigation;
4747 (24) records of investigations of loss occurrences and analyses of loss occurrences that
4748 may be covered by the Risk Management Fund, the Employers' Reinsurance Fund, the
4749 Uninsured Employers' Fund, or similar divisions in other governmental entities;
4750 (25) records, other than personnel evaluations, that contain a personal recommendation
4751 concerning an individual if disclosure would constitute a clearly unwarranted invasion of
4752 personal privacy, or disclosure is not in the public interest;
4753 (26) records that reveal the location of historic, prehistoric, paleontological, or
4754 biological resources that if known would jeopardize the security of those resources or of
4755 valuable historic, scientific, educational, or cultural information;
4756 (27) records of independent state agencies if the disclosure of the records would
4757 conflict with the fiduciary obligations of the agency;
4758 (28) records of an institution within the state system of higher education defined in
4759 Section 53B-1-102 regarding tenure evaluations, appointments, applications for admissions,
4760 retention decisions, and promotions, which could be properly discussed in a meeting closed in
4761 accordance with Title 52, Chapter 4, Open and Public Meetings Act, provided that records of
4762 the final decisions about tenure, appointments, retention, promotions, or those students
4763 admitted, may not be classified as protected under this section;
4764 (29) records of the governor's office, including budget recommendations, legislative
4765 proposals, and policy statements, that if disclosed would reveal the governor's contemplated
4766 policies or contemplated courses of action before the governor has implemented or rejected
4767 those policies or courses of action or made them public;
4768 (30) records of the Office of the Legislative Fiscal Analyst relating to budget analysis,
4769 revenue estimates, and fiscal notes of proposed legislation before issuance of the final
4770 recommendations in these areas;
4771 (31) records provided by the United States or by a government entity outside the state
4772 that are given to the governmental entity with a requirement that they be managed as protected
4773 records if the providing entity certifies that the record would not be subject to public disclosure
4774 if retained by it;
4775 (32) transcripts, minutes, recordings, or reports of the closed portion of a meeting of a
4776 public body except as provided in Section 52-4-206;
4777 (33) records that would reveal the contents of settlement negotiations but not including
4778 final settlements or empirical data to the extent that they are not otherwise exempt from
4779 disclosure;
4780 (34) memoranda prepared by staff and used in the decision-making process by an
4781 administrative law judge, a member of the Board of Pardons and Parole, or a member of any
4782 other body charged by law with performing a quasi-judicial function;
4783 (35) records that would reveal negotiations regarding assistance or incentives offered
4784 by or requested from a governmental entity for the purpose of encouraging a person to expand
4785 or locate a business in Utah, but only if disclosure would result in actual economic harm to the
4786 person or place the governmental entity at a competitive disadvantage, but this section may not
4787 be used to restrict access to a record evidencing a final contract;
4788 (36) materials to which access must be limited for purposes of securing or maintaining
4789 the governmental entity's proprietary protection of intellectual property rights including patents,
4790 copyrights, and trade secrets;
4791 (37) the name of a donor or a prospective donor to a governmental entity, including an
4792 institution within the state system of higher education defined in Section 53B-1-102, and other
4793 information concerning the donation that could reasonably be expected to reveal the identity of
4794 the donor, provided that:
4795 (a) the donor requests anonymity in writing;
4796 (b) any terms, conditions, restrictions, or privileges relating to the donation may not be
4797 classified protected by the governmental entity under this Subsection (37); and
4798 (c) except for an institution within the state system of higher education defined in
4799 Section 53B-1-102, the governmental unit to which the donation is made is primarily engaged
4800 in educational, charitable, or artistic endeavors, and has no regulatory or legislative authority
4801 over the donor, a member of the donor's immediate family, or any entity owned or controlled
4802 by the donor or the donor's immediate family;
4803 (38) accident reports, except as provided in Sections 41-6a-404, 41-12a-202, and
4804 73-18-13;
4805 (39) a notification of workers' compensation insurance coverage described in Section
4806 34A-2-205;
4807 (40) (a) the following records of an institution within the state system of higher
4808 education defined in Section 53B-1-102, which have been developed, discovered, disclosed to,
4809 or received by or on behalf of faculty, staff, employees, or students of the institution:
4810 (i) unpublished lecture notes;
4811 (ii) unpublished notes, data, and information:
4812 (A) relating to research; and
4813 (B) of:
4814 (I) the institution within the state system of higher education defined in Section
4815 53B-1-102; or
4816 (II) a sponsor of sponsored research;
4817 (iii) unpublished manuscripts;
4818 (iv) creative works in process;
4819 (v) scholarly correspondence; and
4820 (vi) confidential information contained in research proposals;
4821 (b) Subsection (40)(a) may not be construed to prohibit disclosure of public
4822 information required pursuant to Subsection 53B-16-302(2)(a) or (b); and
4823 (c) Subsection (40)(a) may not be construed to affect the ownership of a record;
4824 (41) (a) records in the custody or control of the Office of Legislative Auditor General
4825 that would reveal the name of a particular legislator who requests a legislative audit prior to the
4826 date that audit is completed and made public; and
4827 (b) notwithstanding Subsection (41)(a), a request for a legislative audit submitted to the
4828 Office of the Legislative Auditor General is a public document unless the legislator asks that
4829 the records in the custody or control of the Office of Legislative Auditor General that would
4830 reveal the name of a particular legislator who requests a legislative audit be maintained as
4831 protected records until the audit is completed and made public;
4832 (42) records that provide detail as to the location of an explosive, including a map or
4833 other document that indicates the location of:
4834 (a) a production facility; or
4835 (b) a magazine;
4836 (43) information:
4837 (a) contained in the statewide database of the Division of Aging and Adult Services
4838 created by Section 62A-3-311.1; or
4839 (b) received or maintained in relation to the Identity Theft Reporting Information
4840 System (IRIS) established under Section 67-5-22;
4841 (44) information contained in the Management Information System and Licensing
4842 Information System described in Title 62A, Chapter 4a, Child and Family Services;
4843 (45) information regarding National Guard operations or activities in support of the
4844 National Guard's federal mission;
4845 (46) records provided by any pawn or secondhand business to a law enforcement
4846 agency or to the central database in compliance with Title 13, Chapter 32a, Pawnshop and
4847 Secondhand Merchandise Transaction Information Act;
4848 (47) information regarding food security, risk, and vulnerability assessments performed
4849 by the Department of Agriculture and Food;
4850 (48) except to the extent that the record is exempt from this chapter pursuant to Section
4851 63G-2-106, records related to an emergency plan or program, a copy of which is provided to or
4852 prepared or maintained by the Division of Emergency Management, and the disclosure of
4853 which would jeopardize:
4854 (a) the safety of the general public; or
4855 (b) the security of:
4856 (i) governmental property;
4857 (ii) governmental programs; or
4858 (iii) the property of a private person who provides the Division of Emergency
4859 Management information;
4860 (49) records of the Department of Agriculture and Food that provides for the
4861 identification, tracing, or control of livestock diseases, including any program established under
4862 Title 4, Chapter 24, Utah Livestock Brand and Anti-Theft Act, or Title 4, Chapter 31, Control
4863 of Animal Disease;
4864 (50) as provided in Section 26-39-501:
4865 (a) information or records held by the Department of Health related to a complaint
4866 regarding a child care program or residential child care which the department is unable to
4867 substantiate; and
4868 (b) information or records related to a complaint received by the Department of Health
4869 from an anonymous complainant regarding a child care program or residential child care;
4870 (51) unless otherwise classified as public under Section 63G-2-301 and except as
4871 provided under Section 41-1a-116, an individual's home address, home telephone number, or
4872 personal mobile phone number, if:
4873 (a) the individual is required to provide the information in order to comply with a law,
4874 ordinance, rule, or order of a government entity; and
4875 (b) the subject of the record has a reasonable expectation that this information will be
4876 kept confidential due to:
4877 (i) the nature of the law, ordinance, rule, or order; and
4878 (ii) the individual complying with the law, ordinance, rule, or order;
4879 (52) the name, home address, work addresses, and telephone numbers of an individual
4880 that is engaged in, or that provides goods or services for, medical or scientific research that is:
4881 (a) conducted within the state system of higher education, as defined in Section
4882 53B-1-102; and
4883 (b) conducted using animals;
4884 (53) in accordance with Section 78A-12-203, any record of the Judicial Performance
4885 Evaluation Commission concerning an individual commissioner's vote on whether or not to
4886 recommend that the voters retain a judge including information disclosed under Subsection
4887 78A-12-203(5)(e);
4888 (54) information collected and a report prepared by the Judicial Performance
4889 Evaluation Commission concerning a judge, unless Section 20A-7-702 or Title 78A, Chapter
4890 12, Judicial Performance Evaluation Commission Act, requires disclosure of, or makes public,
4891 the information or report;
4892 (55) records contained in the Management Information System created in Section
4893 62A-4a-1003;
4894 (56) records provided or received by the Public Lands Policy Coordinating Office in
4895 furtherance of any contract or other agreement made in accordance with Section 63J-4-603;
4896 (57) information requested by and provided to the 911 Division under Section
4897 63H-7a-302;
4898 (58) in accordance with Section 73-10-33:
4899 (a) a management plan for a water conveyance facility in the possession of the Division
4900 of Water Resources or the Board of Water Resources; or
4901 (b) an outline of an emergency response plan in possession of the state or a county or
4902 municipality;
4903 (59) the following records in the custody or control of the Office of Inspector General
4904 of Medicaid Services, created in Section 63A-13-201:
4905 (a) records that would disclose information relating to allegations of personal
4906 misconduct, gross mismanagement, or illegal activity of a person if the information or
4907 allegation cannot be corroborated by the Office of Inspector General of Medicaid Services
4908 through other documents or evidence, and the records relating to the allegation are not relied
4909 upon by the Office of Inspector General of Medicaid Services in preparing a final investigation
4910 report or final audit report;
4911 (b) records and audit workpapers to the extent they would disclose the identity of a
4912 person who, during the course of an investigation or audit, communicated the existence of any
4913 Medicaid fraud, waste, or abuse, or a violation or suspected violation of a law, rule, or
4914 regulation adopted under the laws of this state, a political subdivision of the state, or any
4915 recognized entity of the United States, if the information was disclosed on the condition that
4916 the identity of the person be protected;
4917 (c) before the time that an investigation or audit is completed and the final
4918 investigation or final audit report is released, records or drafts circulated to a person who is not
4919 an employee or head of a governmental entity for the person's response or information;
4920 (d) records that would disclose an outline or part of any investigation, audit survey
4921 plan, or audit program; or
4922 (e) requests for an investigation or audit, if disclosure would risk circumvention of an
4923 investigation or audit;
4924 (60) records that reveal methods used by the Office of Inspector General of Medicaid
4925 Services, the fraud unit, or the Department of Health, to discover Medicaid fraud, waste, or
4926 abuse;
4927 (61) information provided to the Department of Health or the Division of Occupational
4928 and Professional Licensing under Subsection 58-68-304(3) or (4);
4929 (62) a record described in Section 63G-12-210;
4930 (63) captured plate data that is obtained through an automatic license plate reader
4931 system used by a governmental entity as authorized in Section 41-6a-2003;
4932 (64) any record in the custody of the Utah Office for Victims of Crime relating to a
4933 victim, including:
4934 (a) a victim's application or request for benefits;
4935 (b) a victim's receipt or denial of benefits; and
4936 (c) any administrative notes or records made or created for the purpose of, or used to,
4937 evaluate or communicate a victim's eligibility for or denial of benefits from the Crime Victim
4938 Reparations Fund;
4939 (65) an audio or video recording created by a body-worn camera, as that term is
4940 defined in Section 77-7a-103, that records sound or images inside a hospital or health care
4941 facility as those terms are defined in Section 78B-3-403, inside a clinic of a health care
4942 provider, as that term is defined in Section 78B-3-403, or inside a human service program as
4943 that term is defined in Section 62A-2-101, except for recordings that:
4944 (a) depict the commission of an alleged crime;
4945 (b) record any encounter between a law enforcement officer and a person that results in
4946 death or bodily injury, or includes an instance when an officer fires a weapon;
4947 (c) record any encounter that is the subject of a complaint or a legal proceeding against
4948 a law enforcement officer or law enforcement agency;
4949 (d) contain an officer involved critical incident as defined in Subsection
4950 76-2-408(1)(d); or
4951 (e) have been requested for reclassification as a public record by a subject or
4952 authorized agent of a subject featured in the recording;
4953 (66) a record pertaining to the search process for a president of an institution of higher
4954 education described in Section 53B-2-102, except for application materials for a publicly
4955 announced finalist; and
4956 (67) an audio recording that is:
4957 (a) produced by an audio recording device that is used in conjunction with a device or
4958 piece of equipment designed or intended for resuscitating an individual or for treating an
4959 individual with a life-threatening condition;
4960 (b) produced during an emergency event when an individual employed to provide law
4961 enforcement, fire protection, paramedic, emergency medical, or other first responder service:
4962 (i) is responding to an individual needing resuscitation or with a life-threatening
4963 condition; and
4964 (ii) uses a device or piece of equipment designed or intended for resuscitating an
4965 individual or for treating an individual with a life-threatening condition; and
4966 (c) intended and used for purposes of training emergency responders how to improve
4967 their response to an emergency situation;
4968 (68) records submitted by or prepared in relation to an applicant seeking a
4969 recommendation by the Research and General Counsel Subcommittee, the Budget
4970 Subcommittee, or the Audit Subcommittee, established under Section 36-12-8, for an
4971 employment position with the Legislature;
4972 (69) work papers as defined in Section 31A-2-204; [
4973 (70) a record made available to Adult Protective Services or a law enforcement agency
4974 under Section 61-1-206[
4975 (71) a record submitted to the Insurance Department in accordance with Section
4976 31A-37-201.
4977 Section 55. Section 76-6-521 is amended to read:
4978 76-6-521. Fraudulent insurance act.
4979 (1) A person commits a fraudulent insurance act if that person with intent to defraud:
4980 (a) presents or causes to be presented any oral or written statement or representation
4981 knowing that the statement or representation contains false or fraudulent information
4982 concerning any fact material to an application for the issuance or renewal of an insurance
4983 policy, certificate, or contract[
4984 (i) obtaining an insurance policy the insurer would otherwise not issue on the basis of
4985 underwriting criteria applicable to the person;
4986 (ii) a scheme or artifice to avoid paying the premium that an insurer charges on the
4987 basis of underwriting criteria applicable to the person; or
4988 (iii) a scheme or artifice to file an insurance claim for a loss that has already occurred;
4989 (b) presents, or causes to be presented, any oral or written statement or representation:
4990 (i) (A) as part of or in support of a claim for payment or other benefit pursuant to an
4991 insurance policy, certificate, or contract; or
4992 (B) in connection with any civil claim asserted for recovery of damages for personal or
4993 bodily injuries or property damage; and
4994 (ii) knowing that the statement or representation contains false, incomplete, or
4995 fraudulent information concerning any fact or thing material to the claim;
4996 (c) knowingly accepts a benefit from proceeds derived from a fraudulent insurance act;
4997 (d) intentionally, knowingly, or recklessly devises a scheme or artifice to obtain fees
4998 for professional services, or anything of value by means of false or fraudulent pretenses,
4999 representations, promises, or material omissions;
5000 (e) knowingly employs, uses, or acts as a runner, as defined in Section 31A-31-102, for
5001 the purpose of committing a fraudulent insurance act;
5002 (f) knowingly assists, abets, solicits, or conspires with another to commit a fraudulent
5003 insurance act; [
5004 (g) knowingly supplies false or fraudulent material information in any document or
5005 statement required by the Department of Insurance[
5006 (h) knowingly fails to forward a premium to an insurer in violation of Section
5007 31A-23a-411.1.
5008 (2) (a) A violation of Subsection (1)(a) (i) is a class [
5009 (b) A violation of Subsections (1)(a)(ii) or (1)(b) through (1)[
5010 in the manner prescribed by Section 76-10-1801 for communication fraud for property of like
5011 value.
5012 (c) A violation of Subsection (1)(a)(iii):
5013 (i) is a class A misdemeanor if the value of the loss is less than $1,500 or unable to be
5014 determined; or
5015 (ii) if the value of the loss is $1,500 or more, is punishable as in the manner prescribed
5016 by Section 76-10-1801 for communication fraud for property of like value.
5017 (3) A corporation or association is guilty of the offense of insurance fraud under the
5018 same conditions as those set forth in Section 76-2-204.
5019 (4) The determination of the degree of any offense under Subsections (1)(a)(ii) and
5020 (1)(b) through [
5021 other things obtained or sought to be obtained by the fraudulent insurance act or acts described
5022 in Subsections (1)(a)(ii) and (1)(b) through [
5023 Section 56. Repealer.
5024 This bill repeals:
5025 Section 31A-16a-102, Definitions.
5026 Section 57. Effective date.
5027 (1) Except as provided in Subsection (2), this bill takes effect on May 14, 2019.
5028 (2) The actions affecting the following sections take effect on January 1, 2020:
5029 (a) Section 31A-16b-101;
5030 (b) Section 31A-16b-102;
5031 (c) Section 31A-16b-103;
5032 (d) Section 31A-16b-104;
5033 (e) Section 31A-16b-105;
5034 (f) Section 31A-16b-106;
5035 (g) Section 31A-16b-107; and
5036 (h) Section 31A-16b-108.