Bill Text: CT HB05386 | 2012 | General Assembly | Comm Sub
Bill Title: An Act Concerning Revisions To The Insurance Statutes.
Spectrum: Bipartisan Bill
Status: (Engrossed - Dead) 2012-04-20 - Senate Calendar Number 397 [HB05386 Detail]
Download: Connecticut-2012-HB05386-Comm_Sub.html
General Assembly |
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February Session, 2012 |
*_____HB05386INS___031612____* |
AN ACT CONCERNING REVISIONS TO THE INSURANCE STATUTES.
Be it enacted by the Senate and House of Representatives in General Assembly convened:
Section 1. Section 38a-8 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(a) The commissioner shall see that all laws respecting insurance companies and health care centers are faithfully executed and shall administer and enforce the provisions of this title. The commissioner [has] shall have all powers specifically granted, and all further powers that are reasonable and necessary to enable the commissioner to protect the public interest in accordance with the duties imposed by this title. The commissioner shall pay to the Treasurer all the fees [which he] that the commissioner receives. The commissioner may administer oaths in the discharge of [his] the commissioner's duties.
(b) The commissioner shall recommend to the General Assembly changes [which] that, in [his] the commissioner's opinion, should be made in the laws relating to insurance.
(c) In addition to the specific regulations [which] that the commissioner is required to adopt, the commissioner may adopt such further regulations, in accordance with the provisions of chapter 54, as are reasonable and necessary to implement the provisions of this title. [Regulations shall be adopted in accordance with the provisions of chapter 54.]
(d) The commissioner shall develop a program of periodic review to ensure compliance by the Insurance Department with the minimum standards established by the National Association of Insurance Commissioners for effective financial surveillance and regulation of insurance companies operating in this state. The commissioner shall adopt regulations, in accordance with the provisions of chapter 54, pertaining to the financial surveillance and solvency regulation of insurance companies and health care centers as are reasonable and necessary to obtain or maintain the accreditation of the Insurance Department by the National Association of Insurance Commissioners. The commissioner shall maintain, as confidential, any confidential documents or information received from the National Association of Insurance Commissioners, [or] the Federal Insurance Office, the International Association of Insurance Supervisors or the Bank for International Settlements, or any documents or information received from state or federal insurance, banking or securities regulators or similar regulators in a foreign country, [which] that are confidential in such jurisdictions. The commissioner may share any information, including confidential information, with the National Association of Insurance Commissioners, the Federal Insurance Office, the International Association of Insurance Supervisors, the Bank for International Settlements or state or federal insurance, banking or securities regulators or similar regulators in a foreign country, [so long as] provided the commissioner determines that such entities agree to maintain the same level of confidentiality in their [jurisdiction] jurisdictions as is available in this state. [The] At the expense of a domestic, alien or foreign insurer, the commissioner may engage the services of [, at the expense of a domestic, alien or foreign insurer,] attorneys, actuaries, accountants and other experts not otherwise part of the commissioner's staff as may be necessary to assist the commissioner in the financial analysis of the insurer, the review of the insurer's license applications, and the review of transactions within a holding company system involving an insurer domiciled in this state. No duties of a person employed by the Insurance Department on November 1, 2002, shall be performed by such attorney, actuary, accountant or expert.
(e) The Insurance Commissioner shall establish a program to reduce costs and increase efficiency through the use of electronic methods to transmit documents, including policy form and rate filings, to and from insurers and the Insurance Department. The commissioner may sit as a member of the board of a consortium organized by or in association with the National Association of Insurance Commissioners for the purpose of coordinating a system for electronic rate and form filing among state insurance departments and insurers.
(f) The commissioner shall maintain [,] as confidential [,] information obtained, collected or prepared in connection with examinations, inspections or investigations, and complaints from the public received by the Insurance Department, if such records are protected from disclosure under federal law or state statute or, in the opinion of the commissioner, such records would disclose, or would reasonably lead to the disclosure of: (1) Investigative information the disclosure of which would be prejudicial to such investigation, until such time as the investigation is concluded; or (2) personal, financial or medical information concerning a person who has filed a complaint or inquiry with the Insurance Department, without the written consent of the person or persons to whom the information pertains.
[(g) Not later than January 1, 2006, the Insurance Commissioner shall develop a plan to maintain a viable medical malpractice insurance industry in this state for physicians and surgeons, hospitals, advanced practice registered nurses and physician assistants. Such plan shall be submitted to the Governor upon its completion.]
Sec. 2. Subsection (a) of section 38a-11 of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
(a) The commissioner shall demand and receive the following fees: (1) For the annual fee for each license issued to a domestic insurance company, two hundred dollars; (2) for receiving and filing annual reports of domestic insurance companies, fifty dollars; (3) for filing all documents prerequisite to the issuance of a license to an insurance company, two hundred twenty dollars, except that the fee for such filings by any health care center, as defined in section 38a-175, shall be one thousand three hundred fifty dollars; (4) for filing any additional paper required by law, thirty dollars; (5) for each certificate of valuation, organization, reciprocity or compliance, forty dollars; (6) for each certified copy of a license to a company, forty dollars; (7) for each certified copy of a report or certificate of condition of a company to be filed in any other state, forty dollars; (8) for amending a certificate of authority, two hundred dollars; (9) for each license issued to a rating organization, two hundred dollars. In addition, insurance companies shall pay any fees imposed under section 12-211; (10) a filing fee of fifty dollars for each initial application for a license made pursuant to section 38a-769; (11) with respect to insurance agents' appointments: (A) A filing fee of fifty dollars for each request for any agent appointment, except that no filing fee shall be payable for a request for agent appointment by an insurance company domiciled in a state or foreign country which does not require any filing fee for a request for agent appointment for a Connecticut insurance company; (B) a fee of one hundred dollars for each appointment issued to an agent of a domestic insurance company or for each appointment continued; and (C) a fee of eighty dollars for each appointment issued to an agent of any other insurance company or for each appointment continued, except that (i) no fee shall be payable for an appointment issued to an agent of an insurance company domiciled in a state or foreign country which does not require any fee for an appointment issued to an agent of a Connecticut insurance company, and (ii) the fee shall be twenty dollars for each appointment issued or continued to an agent of an insurance company domiciled in a state or foreign country with a premium tax rate below Connecticut's premium tax rate; (12) with respect to insurance producers: (A) An examination fee of fifteen dollars for each examination taken, except when a testing service is used, the testing service shall pay a fee of fifteen dollars to the commissioner for each examination taken by an applicant; (B) a fee of eighty dollars for each license issued; (C) a fee of eighty dollars per year, or any portion thereof, for each license renewed; and (D) a fee of eighty dollars for any license renewed under the transitional process established in section 38a-784; (13) with respect to public adjusters: (A) An examination fee of fifteen dollars for each examination taken, except when a testing service is used, the testing service shall pay a fee of fifteen dollars to the commissioner for each examination taken by an applicant; and (B) a fee of two hundred fifty dollars for each license issued or renewed; (14) with respect to casualty adjusters: (A) An examination fee of twenty dollars for each examination taken, except when a testing service is used, the testing service shall pay a fee of twenty dollars to the commissioner for each examination taken by an applicant; (B) a fee of eighty dollars for each license issued or renewed; and (C) the expense of any examination administered outside the state shall be the responsibility of the entity making the request and such entity shall pay to the commissioner two hundred dollars for such examination and the actual traveling expenses of the examination administrator to administer such examination; (15) with respect to motor vehicle physical damage appraisers: (A) An examination fee of eighty dollars for each examination taken, except when a testing service is used, the testing service shall pay a fee of eighty dollars to the commissioner for each examination taken by an applicant; (B) a fee of eighty dollars for each license issued or renewed; and (C) the expense of any examination administered outside the state shall be the responsibility of the entity making the request and such entity shall pay to the commissioner two hundred dollars for such examination and the actual traveling expenses of the examination administrator to administer such examination; (16) with respect to certified insurance consultants: (A) An examination fee of twenty-six dollars for each examination taken, except when a testing service is used, the testing service shall pay a fee of twenty-six dollars to the commissioner for each examination taken by an applicant; (B) a fee of two hundred fifty dollars for each license issued; and (C) a fee of two hundred fifty dollars for each license renewed; (17) with respect to surplus lines brokers: (A) An examination fee of twenty dollars for each examination taken, except when a testing service is used, the testing service shall pay a fee of twenty dollars to the commissioner for each examination taken by an applicant; and (B) a fee of six hundred twenty-five dollars for each license issued or renewed; (18) with respect to fraternal agents, a fee of eighty dollars for each license issued or renewed; (19) a fee of twenty-six dollars for each license certificate requested, whether or not a license has been issued; (20) with respect to domestic and foreign benefit societies: [shall pay:] (A) For service of process, fifty dollars for each person or insurer to be served; (B) for filing a certified copy of its charter or articles of association, fifteen dollars; (C) for filing the annual report, twenty dollars; and (D) for filing any additional paper required by law, fifteen dollars; (21) with respect to foreign benefit societies: (A) For each certificate of organization or compliance, fifteen dollars; (B) for each certified copy of permit, fifteen dollars; and (C) for each copy of a report or certificate of condition of a society to be filed in any other state, fifteen dollars; (22) with respect to reinsurance intermediaries, a fee of six hundred twenty-five dollars for each license issued or renewed; (23) with respect to life settlement providers: (A) A filing fee of twenty-six dollars for each initial application for a license made pursuant to section 38a-465a; and (B) a fee of forty dollars for each license issued or renewed; (24) with respect to life settlement brokers: (A) A filing fee of twenty-six dollars for each initial application for a license made pursuant to section 38a-465a; and (B) a fee of forty dollars for each license issued or renewed; (25) with respect to preferred provider networks, a fee of two thousand seven hundred fifty dollars for each license issued or renewed; (26) with respect to rental companies, as defined in section 38a-799, a fee of eighty dollars for each permit issued or renewed; (27) with respect to medical discount plan organizations licensed under section 38a-479rr, a fee of six hundred twenty-five dollars for each license issued or renewed; (28) with respect to pharmacy benefits managers, an application fee of one hundred dollars for each registration issued or renewed; (29) with respect to captive insurance companies, as defined in section 38a-91aa, a fee of three hundred seventy-five dollars for each license issued or renewed; (30) with respect to each duplicate license issued a fee of fifty dollars for each license issued; (31) with respect to surety bail bond agents, as defined in section 38a-660, as amended by this act: (A) [a] A filing fee of one hundred fifty dollars for each initial application for a license; [,] and (B) a fee of one hundred dollars for each license issued or renewed; [and] (32) with respect to third-party administrators, as defined in section 38a-720: [,] (A) [a] A fee of five hundred dollars for each license issued; [,] (B) a fee of three hundred fifty dollars for each license renewed; [,] and (C) a fee of one hundred dollars for each annual report filed pursuant to section 38a-720l; (33) a filing fee of two thousand five hundred dollars for each statement of acquisition of control of a domestic insurance company filed pursuant to section 38a-130, as amended by this act.
Sec. 3. Subsection (a) of section 38a-130 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
(a) No person other than the issuer shall make a tender offer for [,] or a request or invitation for tenders of, enter into any agreement to exchange securities for, seek to acquire [,] or acquire, in the open market or otherwise, any voting security, or solicit any proxy for the purpose of acquiring control, of a domestic insurance company or, subject to the provisions of subsection (c) of this section, any corporation controlling a domestic insurance company if, after the consummation thereof, such person would, directly or indirectly, or by conversion or by exercise of any right to acquire, be in control of such domestic insurance company or corporation controlling a domestic insurance company, and no person shall enter into an agreement to merge with or otherwise acquire control of a domestic insurance company or any corporation controlling a domestic insurance company unless, at the time any form of initial offer, request or invitation is made or the agreement is entered into, or prior to the acquisition of such securities or proxies if no offer or agreement is involved, (1) such person has filed with the commissioner and has sent to such insurance company a statement containing the information required by subsection (b) of this section, (2) such person has paid a filing fee as specified in section 38a-11, as amended by this act, and (3) such offer, request, invitation, agreement or acquisition has been approved by the commissioner in the manner hereinafter prescribed.
Sec. 4. Section 38a-14 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
(a) The commissioner shall, as often as [he] the commissioner deems it expedient, examine into the affairs of any insurance company or health care center doing business in this state, any corporation or association collecting data utilized by any such insurance company in the underwriting of insurance policies and any corporation organized under any law of this state or having an office in this state, which corporation is engaged in, or claiming or advertising that it is engaged in, organizing or receiving subscriptions for or disposing of stock of, or in any manner aiding or taking part in the formation or business of, an insurance company or companies, or [which] that is holding the capital stock of one or more insurance corporations for the purpose of controlling the management thereof, as voting trustees or otherwise.
(b) In scheduling and determining the nature, scope and frequency of the examinations, the commissioner shall consider such matters as the results of financial statement analyses and ratios, changes in management or ownership, actuarial opinions, reports of independent certified public accountants and such other criteria as set forth in the examiners' handbook adopted by the National Association of Insurance Commissioners and in effect at the time the commissioner exercises discretion under this section.
(c) (1) To carry out examinations under this section, the commissioner may appoint [, as examiners,] one or more competent persons as examiners, who shall not be officers of, [or] connected with or interested in any insurance company, other than as [a policyholder] policyholders. The commissioner may engage the services of attorneys, appraisers, independent actuaries, independent certified public accountants or other professionals and specialists as examiners to assist [him] the commissioner in conducting the examinations under this section, [as examiners,] the cost of which shall be borne by the company [which] that is the subject of the examination.
(2) In conducting the examination, the commissioner, [his] the commissioner's actuary or any examiner authorized by the commissioner may examine, under oath, the officers and agents of such a company, health care center, corporation or association and all persons deemed to have material information regarding the company's, health care center's, corporation's or association's property or business. Each such company, health care center, corporation or association, and its officers and agents, shall produce the books and papers [,] in its or their possession, relating to its business or affairs, and any other person may be required to produce any book or paper [,] in [his] such person's custody [,] that is deemed to be relevant to such examination, for [the] inspection [of] by the commissioner, [his] the commissioner's actuary or examiners. [, when required.] The officers and agents of the company, health care center, corporation or association shall facilitate the examination and aid the examiners in making the same so far as it is in their power to do so. The refusal of any company, by its officers, directors, employees or agents, to submit to examination or to comply with any reasonable written request of the examiners shall be grounds for suspension of, [or] refusal of or nonrenewal of any license or authority held by the company to engage in an insurance or other business subject to the commissioner's jurisdiction. Any such proceedings for suspension, revocation or refusal of any license or authority shall be conducted pursuant to subsection (c) of section 38a-41.
(3) In conducting the examination, the examiner shall observe those guidelines and procedures set forth in the examiners' handbook adopted by the National Association of Insurance Commissioners. The commissioner may also adopt such other guidelines or procedures as the commissioner may deem appropriate.
(d) In lieu of an examination under this section of any foreign or alien insurer licensed in this state, the commissioner may accept [until January 1, 1994,] an examination report on [the company] such insurer prepared by the insurance department for the company's state of domicile or port-of-entry state [. Thereafter, such reports may only be accepted] if (1) such state's insurance department was, at the time of the examination, accredited under the National Association of Insurance Commissioners' financial regulation standards and accreditation program, or (2) the examination is performed under the supervision of an accredited insurance department or with the participation of one or more examiners who are employed by such an accredited state insurance department and who, after a review of the examination workpapers and report, state under oath that the examination was performed in a manner consistent with the standards and procedures required by their insurance department.
(e) (1) Nothing contained in this section shall be construed to limit the commissioner's authority to terminate or suspend any examination in order to pursue legal or regulatory action pursuant to the insurance laws of this state. Findings of fact and conclusions made pursuant to any examination shall be prima facie evidence in any legal or regulatory action.
(2) Nothing contained in this section shall be construed to limit the commissioner's authority in such legal or regulatory action to use and, if appropriate, to make public any final or preliminary examination report, any examiner or company workpapers or other documents, or any other information discovered or developed during the course of any examination.
(3) Not later than sixty days following completion of the examination, the examiner in charge shall file, under oath, with the Insurance Department a verified written report of examination. Upon receipt of the verified report, the Insurance Department shall transmit the report to the [company] entity examined, together with a notice [which] that shall afford the [company] entity examined a reasonable opportunity, not to exceed thirty days, to make a written submission or rebuttal with respect to any matters contained in the examination report. Not later than thirty days after the period allowed for the receipt of written submissions or rebuttals, the commissioner shall fully consider and review the report, together with any written submissions or rebuttals and any relevant portions of the examiner's workpapers and enter an order: (A) Adopting the examination report as filed or with modification or corrections. If the examination report reveals that the [company] entity is operating in violation of any law, regulation or prior order of the commissioner, the commissioner may order the company to take any action the commissioner considers necessary and appropriate to cure such violation; (B) rejecting the examination report with directions to the examiners to reopen the examination for purposes of obtaining additional data, documentation or information, and refiling pursuant to [subparagraph (A) of] this subdivision; or (C) calling for an investigatory hearing with not less than twenty days' notice to the company for purposes of obtaining additional documentation, data, information and testimony.
(4) (A) The commissioner shall transmit the examination report adopted pursuant to subparagraph (A) of subdivision (3) of this subsection or a summary thereof to the entity examined, together with any recommendations or written statements from the commissioner or the examiner. The secretary of the board of directors or similar governing body of the entity shall provide a copy of the report or summary to each director and shall certify to the commissioner, in writing, that a copy of the report or summary has been provided to each director. Such certification shall be deemed to constitute knowledge of the contents of the report or summary by each director.
(B) Not later than ninety days after receiving the report or summary, the chief executive officer of the entity examined shall present the report or summary to the entity's board of directors or similar governing body at a regular or special meeting.
(f) (1) All orders entered pursuant to subdivision (3) of subsection (e) of this section shall be accompanied by findings and conclusions resulting from the commissioner's consideration and review of the examination report, relevant examiner workpapers and any written submissions or rebuttals. The findings and conclusions [, which] that form the basis of any such order of the commissioner [,] shall be subject to review as provided in section 38a-19.
(2) Any investigatory hearing conducted under subparagraph (C) of subdivision (3) of subsection (e) of this section by the commissioner or the commissioner's authorized representative, shall be conducted as a nonadversarial confidential investigatory proceeding as necessary for the resolution of any inconsistencies, discrepancies or disputed issues apparent (A) upon the filed examination report, (B) raised by or as a result of the commissioner's review of relevant workpapers, or (C) by the written submission or rebuttal of the company. Not later than twenty days after the [conclusions] conclusion of any such hearing, the commissioner shall enter an order pursuant to subparagraph (A) of subdivision (3) of subsection (e) of this section. The commissioner shall not appoint an examiner as an authorized representative to conduct the hearing. The hearing shall proceed expeditiously with discovery by the company limited to the examiner's workpapers that tend to substantiate any assertions set forth in any written submission or rebuttal. The commissioner or [his] the commissioner's authorized representative may issue subpoenas for the attendance of any witnesses or the production of any documents deemed relevant to the investigation, whether under the control of the department, the company or other persons. The documents produced shall be included in the record and testimony taken by the commissioner or [his] the commissioner's authorized representative shall be under oath and preserved for the record. Nothing contained in this section shall require the department to disclose any information or records that would indicate or show the existence or content of any investigation or activity of a criminal justice agency. The hearing shall proceed with the commissioner or [his] the commissioner's authorized representative posing questions to the persons subpoenaed. Thereafter, the company and the Insurance Department may present testimony relevant to the investigation. Cross-examination shall be conducted only by the commissioner or [his] the commissioner's authorized representative. The company and the Insurance Department shall be permitted to make closing statements and may be represented by counsel of their choice.
(g) The commissioner may, if [he] the commissioner deems it in the public interest, publish any such report, or the result of any such examination contained therein, in one or more newspapers of the state.
(h) The commissioner shall, at least once in every five years, visit and examine the affairs of each domestic insurance company, health care center, domestic fraternal benefit society, and foreign and alien insurance company doing business in this state. Notwithstanding subdivision (1) of subsection (c) of this section, no domestic insurance company or other domestic entity subject to examination under this section shall pay as costs associated with the examination the salaries, fringe benefits, traveling and maintenance expenses of examining personnel of the Insurance Department engaged in such examination if such domestic company or entity is otherwise liable to assessment levied under section 38a-47, except that a domestic insurance company or other domestic entity shall pay the traveling and maintenance expenses of examining personnel of the Insurance Department when such company or entity is examined outside the state.
(i) Nothing contained in this section shall prevent or be construed as prohibiting the commissioner from disclosing the content of an examination report, preliminary examination report or results, or any matter relating thereto, to the Insurance Department of this or any other state or country, or to law enforcement officials of this or any other state or to any agency of the federal government at any time, so long as such agency or office receiving the report or matters relating thereto agrees, in writing, to hold [it] such report and matters relating thereto confidential.
(j) All [working papers] workpapers, recorded information, documents and copies thereof produced by, obtained by or disclosed to the commissioner or any other person in the course of an examination made under this section shall be given confidential treatment, shall not be subject to subpoena and shall not be made public by the commissioner or any other person, except to the extent provided in subsection (i) of this section. [Access] The commissioner may grant access to such [information may be granted by the commissioner] workpapers, recorded information, documents and copies thereof to the National Association of Insurance Commissioners, [so long as it] provided such association agrees, in writing, to hold [it] such workpapers, recorded information, documents and copies thereof confidential.
(k) (1) The commissioner may from time to time engage, on an individual basis, the services of [, from time to time, on an individual basis,] qualified actuaries, certified public accountants [,] or other similar individuals who are independently practicing their professions, even though said persons may from time to time be similarly employed or retained by persons subject to examination under this section.
(2) No cause of action shall arise nor shall any liability be imposed against the commissioner, the commissioner's authorized representatives or any examiner appointed by the commissioner for any statements made or conduct performed in good faith while carrying out the provisions of this section.
(3) No cause of action shall arise, nor shall any liability be imposed against any person for the act of communicating or delivering information or data to the commissioner or the commissioner's authorized representative examiner pursuant to an examination made under this section, if such act of communication or delivery was performed in good faith and without fraudulent intent or the intent to deceive.
(4) This section [does] shall not abrogate or modify in any way any common law or statutory privilege or immunity heretofore enjoyed by any person identified in subdivision (2) of this subsection.
(5) A person identified in subdivision (2) of this subsection shall be entitled to an award of attorney's fees and costs if such person is the prevailing party in a civil cause of action for libel, slander or any other relevant tort arising out of activities in carrying out the provisions of this section and the party bringing the action was not substantially justified in doing so. For purposes of this section, a proceeding is "substantially justified" if it had a reasonable basis in law or fact at the time that it was initiated.
Sec. 5. Section 38a-53 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
(a) (1) Each domestic insurance company or health care center shall, annually, on or before the first day of March, submit to the commissioner, and electronically to the National Association of Insurance Commissioners, a true and complete report, signed and sworn to by its president or a vice president, and secretary or an assistant secretary, of its financial condition on the thirty-first day of December next preceding, prepared in accordance with the National Association of Insurance Commissioners annual statement instructions handbook and following those accounting procedures and practices prescribed by the National Association of Insurance Commissioners accounting practices and procedures manual, subject to any deviations in form and detail as may be prescribed by the commissioner. An electronically filed report in accordance with section 38a-53a that is timely submitted to the National Association of Insurance Commissioners [does] shall not exempt a domestic insurance company or health care center from timely filing a true and complete paper copy with the commissioner.
(2) Each accredited reinsurer, as defined in subdivision (1) of subsection (c) of section 38a-85, and assuming insurance company, as provided in section 38a-85, shall file an annual report in accordance with the provisions of section 38a-85.
(b) Each foreign insurance company doing business in this state shall, annually, on or before the first day of March, submit to the commissioner, by electronically filing with the National Association of Insurance Commissioners, a true and complete report, signed and sworn to by its president or a vice president, and secretary or an assistant secretary, of its financial condition on the thirty-first day of December next preceding, prepared in accordance with the National Association of Insurance Commissioners annual statement instructions handbook and following those accounting procedures and practices prescribed by the National Association of Insurance Commissioners accounting practices and procedures manual, subject to any deviations in form and detail as may be prescribed by the commissioner. An electronically filed report in accordance with section 38a-53a that is timely submitted to the National Association of Commissioners [is] shall be deemed to have been submitted to the commissioner in accordance with this section.
(c) In addition to such annual report, the commissioner, when [he] the commissioner deems it necessary, may require any insurance company or health care center doing business in this state to file financial statements on a quarterly basis. An electronically filed true and complete report filed in accordance with section 38a-53a that is timely filed with the National Association of Insurance Commissioners shall be deemed to have been submitted to the commissioner in accordance with the provisions of this section.
(d) In addition to such annual report and the quarterly report required under subsection (c) of this section, the commissioner, whenever the commissioner determines that more frequent reports are required because of certain factors or trends affecting companies writing a particular class or classes of business or because of changes in the company's management or financial or operating condition, may require any insurance company or health care center doing business in this state to file financial statements on other than an annual or quarterly basis.
(e) Any insurance company or health care center doing business in this state [which] that fails to file any report or statement required under this section shall pay a late filing fee of one hundred seventy-five dollars per day for each day from the due date of such report or statement to the date of filing. The commissioner may waive the late filing fee if (1) the insurance company or health care center cannot file such report or statement because the governor of such company's or health care center's state of domicile has proclaimed a state of emergency in such state and such state of emergency impairs the insurance company's or health care center's ability to file the report or statement, or (2) the insurance regulatory official of the state of domicile of a foreign insurance company or foreign health care center has permitted the insurance company or health care center to file such report or statement late.
(f) Each insurance company or health care center doing business in this state shall include in all reports required to be filed with the commissioner under this section a certification by an actuary or reserve specialist of all reserve liabilities prepared in accordance with regulations [which] that shall be adopted by the commissioner in accordance with chapter 54. The regulations shall: (1) Specify the contents and scope of the certification; (2) provide for the availability to the commissioner of the workpapers of the actuary or loss reserve specialist; and (3) provide for granting companies or centers exemptions from compliance with the requirements of this subsection. The commissioner shall maintain, as confidential, all workpapers of the actuary or loss reserve specialist and the actuarial report and actuarial opinion summary provided in support of the certification. Such workpapers, reports and summaries shall not be subject to subpoena or disclosure under the Freedom of Information Act, as defined in section 1-200.
Sec. 6. Section 31-331 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
Except as herein otherwise provided, such associations shall be subject to the same regulation and control as is or may be imposed by law upon other corporations or associations taking similar risks in this state, and over them the Insurance Commissioner shall have all the jurisdiction given him by sections 38a-14 and 38a-17, as amended by this act, over insurance companies, provided with respect to any such association organized prior to June 6, 1996, with a membership composed exclusively of health care providers and whose premium base is derived entirely from health care organizations, the commissioner may accept a statement of financial condition that shall be audited by an independent certified public accountant using generally accepted accounting principles if such statement also includes a conversion to the accounting standards prescribed by section 38a-70. Such statement of financial condition shall be submitted to the commissioner by such association, annually, on or before the first day of March, signed and sworn to by its president or vice president and secretary or an assistant secretary, of its financial condition on the thirty-first day of December next preceding, prepared in such form and detail as may be prescribed by the commissioner and shall include a certification by an actuary or reserve specialist of all reserve liabilities prepared in accordance with subsection [(e)] (f) of section 38a-53, as amended by this act. In addition to such annual statement of financial condition, any such association shall file, quarterly, unaudited financial statements using generally accepted accounting principles if such statements also include a conversion to the accounting standards prescribed by section 38a-70.
Sec. 7. Section 38a-162 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
(a) No person shall engage in the business of financing insurance premiums, secured by any insurance premium finance agreement, in this state without having first obtained from the commissioner a license to act as an insurance premium finance company. Any person who engages in the business of financing insurance premiums, secured by any insurance premium finance agreement, in this state without first obtaining a license as herein provided shall, upon conviction be guilty of a class A misdemeanor.
(b) All licenses issued under the provisions of sections 38a-160 to 38a-170, inclusive, shall expire on the thirtieth day of June following the date of their issuance. At the time of application for an insurance premium finance company license and for every annual renewal thereof, [there shall be paid] the applicant shall pay to the commissioner the sum of [fifty] three hundred dollars. If a license is not issued, the commissioner shall return the fee. [shall be returned.]
(c) Any person applying for an insurance premium finance license or for the renewal of any such license, shall file with the commissioner sworn answers to such interrogatories as [he] the commissioner may require and any person who intentionally makes any false answer to any such interrogatory shall be guilty of perjury.
(d) The commissioner may at any time require any applicant for a license under sections 38a-160 to 38a-170, inclusive, [fully] to disclose fully the identity of all stockholders, partners, officers and employees of [his] the applicant's firm, partnership or corporation. [, and he] The commissioner may refuse to issue or renew any license under said sections in the name of any firm, partnership or corporation if [he] the commissioner is satisfied that any officer, employee, stockholder or partner thereof, may materially influence the applicant's conduct [so that he] such that the applicant does not meet the standards or qualifications required of a licensee under said sections.
Sec. 8. Section 38a-163 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
(a) Each applicant for an insurance premium finance company license or for any renewal of such license shall file with the commissioner a written application in such manner and form as the commissioner shall prescribe, [together] with [said] the fee [of fifty dollars which fee shall be returned to the applicant if such license is not granted] specified under section 38a-162, as amended by this act.
(b) Upon the filing of an application and payment of the license fee, the commissioner shall make an investigation of the applicant and shall issue an insurance premium finance company license if the applicant is qualified in accordance with the provisions of sections 38a-160 to 38a-170, inclusive. If the commissioner does not find the applicant so qualified, [he] the commissioner shall, [within] not later than thirty days [of] after receipt of the license application and fee, grant the applicant a full hearing, provided such applicant shall have requested such hearing within said period. Any hearing conducted under said sections may be held by the commissioner or any person duly appointed by [him] the commissioner. [, provided any] Any person acting as a hearing officer on behalf of the commissioner shall submit [his] such person's findings and recommendations to the commissioner for [his] the commissioner's decision in the matter.
(c) The commissioner may issue or renew any license under this [chapter] part when [he] the commissioner is satisfied that the applicant (1) is competent and trustworthy and intends to act in good faith in the capacity of a licensee under the provisions of sections 38a-160 to 38a-170, inclusive, [;] (2) has a good business reputation and has had such experience, training or education so as to qualify [him] the applicant for a license under the provisions of said sections, and (3) if the applicant is a corporation, that it is either incorporated under the laws of this state or, if a foreign corporation, it is authorized to transact business in this state.
Sec. 9. Section 38a-188 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
Each health care center governed by sections 38a-175 to 38a-192, inclusive, shall be exempt from the provisions of the general statutes relating to insurance in the conduct of its operations under said sections and in such other activities as do constitute the business of insurance, unless expressly included therein, and except for the following: Sections 38a-11, as amended by this act, 38a-14a, 38a-17, 38a-51, 38a-52, 38a-56, 38a-57, 38a-129 to 38a-140, inclusive, 38a-147 and 38a-815 to 38a-819, inclusive, provided a health care center shall not be deemed in violation of sections 38a-815 to 38a-819, inclusive, solely by virtue of such center selectively contracting with certain providers in one or more specialties, and sections 38a-80, 38a-492b, 38a-518b, 38a-543, 38a-702j, 38a-703 to 38a-718, inclusive, 38a-731 to 38a-735, inclusive, 38a-741 to 38a-745, inclusive, as amended by this act, 38a-769, 38a-770, 38a-772 to [38a-777] 38a-776, inclusive, 38a-786, 38a-790, 38a-792 and 38a-794, provided a health care center organized as a nonprofit, nonstock corporation shall be exempt from sections 38a-146, 38a-702j, 38a-703 to 38a-718, inclusive, 38a-731 to 38a-735, inclusive, 38a-741 to 38a-745, inclusive, as amended by this act, 38a-769, 38a-770, 38a-772 to [38a-777] 38a-776, inclusive, 38a-786, 38a-790, 38a-792 and 38a-794. If a health care center is operated as a line of business, the foregoing provisions shall, where possible, be applied only to that line of business and not to the organization as a whole. The commissioner may adopt regulations, in accordance with chapter 54, stating the circumstances under which the resources of a person which controls a health care center, or operates a health care center as a line of business will be considered in evaluating the financial condition of a health care center. Such regulations, if adopted, shall require as a condition to the consideration of the resources of such person which controls a health care center, or operates a health care center as a line of business to provide satisfactory assurances to the commissioner that such person will assume the financial obligations of the health care center. During the period prior to the effective date of regulations issued under this section, the commissioner shall, upon request, consider the resources of a person which controls a health care center, or operates a health care center as a line of business, if the commissioner receives satisfactory assurances from such person that it will assume the financial obligations of the health care center and determines that such person meets such other requirements as the commissioner determines are necessary. A health care center organized as a nonprofit, nonstock corporation shall be exempt from the sales and use tax and all property of each such corporation shall be exempt from state, district and municipal taxes. Each corporation governed by sections 38a-175 to 38a-192, inclusive, shall be subject to the provisions of sections 38a-903 to 38a-961, inclusive. Nothing in this section shall be construed to override contractual and delivery system arrangements governing a health care center's provider relationships.
Sec. 10. Section 38a-436 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
[Every] (a) Except as specified in subsection (b) of this section, each individual life insurance policy delivered or issued for delivery to any person in this state shall have printed thereon or attached thereto a notice stating, in substance, that the policy may be returned by the applicant for cancellation by delivering or mailing the policy to the insurer or to the insurance agent through whom it was effected, at any time within ten days after receipt of the policy by the applicant, and that upon the delivery or mailing the policy shall be void ab initio.
(b) Each individual life insurance policy sold or offered in this state that involves replacement of an existing policy or the borrowing on or lapsing of such existing policy shall have printed thereon or attached thereto a notice stating, in substance, that the policy may be returned by the applicant for cancellation by delivering or mailing the policy to the insurer or to the insurance agent through whom it was effected, at any time within thirty days after receipt of the policy by the applicant, and that upon the delivery or mailing the policy shall be void ab initio.
Sec. 11. Section 38a-614 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
[Reports] A society shall [be filed] file reports and publish synopses of annual statements [shall be published] in accordance with the provisions of this section.
(1) [Every] Each domestic society transacting business in this state shall, annually, on or before the first day of March, unless the commissioner has extended such time for cause shown, [such time has been extended by the commissioner,] file with the commissioner, and electronically to the National Association of Insurance Commissioners, a true and complete statement of its financial condition, transactions and affairs for the preceding calendar year and pay a fee of ten dollars for filing the same. The statement shall be in general form and context as approved by the National Association of Insurance Commissioners for fraternal benefit societies and as supplemented by additional information required by the commissioner. An electronically filed true and complete report filed in accordance with section 38a-53a that is timely submitted to the National Association of Insurance Commissioners [does] shall not exempt a domestic [insurance company or health care center] society from timely filing a true and complete paper copy with the commissioner.
(2) [Every] Each foreign society transacting business in this state shall, annually, on or before the first day of March, unless the commissioner has extended such time for cause shown, [such time has been extended by the commissioner,] file with the commissioner, and electronically to the National Association of Insurance Commissioners, a true and complete statement of its financial condition, transactions and affairs for the preceding calendar year and pay a fee of ten dollars for filing the same. The statement shall be in general form and context as approved by the National Association of Insurance Commissioners for fraternal benefit societies and as supplemented by additional information required by the commissioner. An electronically filed true and complete report filed in accordance with section 38a-53a that is timely submitted to the National Association of Insurance Commissioners shall be deemed to have been submitted to the commissioner in accordance with this section.
(3) [A] Not later than June first, annually, each society shall print and mail to each benefit member of the society a synopsis of its annual statement [providing] that provides an explanation of the facts thereby disclosed concerning the condition of the society. [thereby disclosed shall be printed and mailed to each benefit member of the society not later than the first day of June of each year, or, in] In lieu thereof, a society may publish such synopsis [may be published] in the society's official publication.
(4) (A) As part of the annual statement [herein] required under this section, each society shall, on or before the first day of March, annually, file with the commissioner a valuation of its certificates in force on December thirty-first last preceding, provided the commissioner may, [in his discretion] for cause shown, extend the time for filing such valuation for not more than two calendar months. Such report of valuation shall show, as reserve liabilities, the difference between the present midyear value of the promised benefits provided in the certificates of such society in force and the present midyear value of the future net premiums as the same are in practice actually collected, not including therein any value for the right to make extra assessments and not including any amount by which the present midyear value of future net premiums exceeds the present midyear value of promised benefits on individual certificates.
(B) At the option of any society, in lieu of the [above] valuation specified in subparagraph (A) of this subdivision, the valuation may show the net tabular value. Such net tabular value as to certificates issued prior to January 1, 1959, shall be determined in accordance with the provisions of law applicable prior to January 1, 1958, and as to certificates issued on or after January 1, 1959, shall not be less than the reserves determined according to the Commissioners' Reserve Valuation method as hereinafter defined. If the premium charge is less than the tabular net premium according to the basis of valuation used, an additional reserve equal to the present value of the deficiency in such premiums shall be set up and maintained as a liability. The reserve liabilities shall be properly adjusted if the midyear or tabular values are not appropriate.
(5) Reserves according to the Commissioners' Reserve Valuation method, for the life insurance and endowment benefits of certificates providing for a uniform amount of insurance and requiring the payment of uniform premiums, shall be the excess, if any, of the present value, at the date of valuation, of such future guaranteed benefits provided for by such certificates over the then present value of any future modified net premiums therefor. The modified net premiums for any such certificate shall be such uniform percentage of the respective contract premiums for such benefits that the present value, at the date of issue of the certificate, of all such modified net premiums shall be equal to the sum of the then present value of such benefits provided for by the certificate and the excess of (A) over (B), as follows: (A) A net level premium equal to the present value, at the date of issue, of such benefits provided for after the first certificate year, divided by the present value, at the date of issue, of an annuity of one per annum payable on the first and each subsequent anniversary of such certificate on which a premium falls due; provided such net level annual premium shall not exceed the net level annual premium on the nineteen year premium whole life plan for insurance of the same amount at an age one year higher than the age at issue of such certificate; and (B) a net one-year term premium for such benefits provided for in the first certificate year. Reserves according to the Commissioners' Reserve Valuation method for (i) life insurance benefits for varying amounts of benefits or requiring the payment of varying premiums, (ii) annuity and pure endowment benefits, (iii) disability and accidental death benefits in all certificates and contracts, and (iv) all other benefits except life insurance and endowment benefits shall be calculated by a method consistent with the principles of this subdivision.
(6) The present value of deferred payments due under incurred claims or matured certificates shall be deemed a liability of the society and shall be computed upon mortality and interest standards prescribed in subdivision (7) of this section.
(7) Such valuation and underlying data shall be certified by a competent actuary or, at the expense of the society, verified by the actuary of the department of insurance of the state of domicile of the society. The minimum standards of valuation for certificates issued prior to January 1, 1959, shall be those provided by the law applicable immediately prior to January 1, 1958, but not lower than the standards used in the calculating of rates for such certificates. The minimum standard of valuation for certificates issued after January 1, 1959, shall be three and one-half per cent interest and the following tables: (A) For certificates of life insurance, American Men Ultimate Table of Mortality, with Bowerman's or Davis' Extension thereof or, with the consent of the Insurance Commissioner, the Commissioner's 1941 Standard Ordinary Mortality Table or the Commissioner's 1941 Standard Industrial Table of Mortality, or the Commissioners' 1958 Standard Ordinary Mortality Table, except that, with the approval of the commissioner, the valuation of contracts on female risks may be calculated, at the option of the society, according to an age not more than three years younger than the actual age of the insured; (B) for annuity certificates, including life annuities provided or available under optional modes of settlement in such certificates, the 1937 Standard Annuity Table; (C) for disability benefits issued in connection with life benefit certificates, Hunter's Disability Table, which, for active lives, shall be combined with a mortality table permitted for calculating the reserves on life insurance certificates, except that the table known as Class III Disability Table (1926), modified to conform to the contractual waiting period, shall be used in computing reserves for disability benefits under a contract which presumes that total disability shall be considered to be permanent after a specified period; (D) for accidental death benefits issued in connection with life benefit certificates, the Inter-Company Double Indemnity Mortality Table combined with a mortality table permitted for calculating the reserves for life insurance certificates; and (E) for noncancellable accident and health benefits, the Class III Disability Table (1926) with conference modifications or, with the consent of the commissioner, tables based upon the society's own experience. The commissioner may, in the commissioner's discretion, accept other standards for valuation if the commissioner finds that the reserves produced thereby will not be less in the aggregate than reserves computed in accordance with the minimum valuation standard herein prescribed. The commissioner may [, in his or her discretion,] vary the standards of mortality applicable to all certificates of insurance on substandard lives or other extra hazardous lives by any society authorized to do business in this state. Whenever the mortality experience under all certificates valued on the same mortality table is in excess of the expected mortality according to such table for a period of three consecutive years, the commissioner may require additional reserves when deemed necessary in [his or her] the commissioner's judgment on account of such certificates. Any society, with the consent of the insurance commissioner of the state of domicile of the society and under such conditions, if any, [which the] that such commissioner may impose, may establish and maintain reserves on its certificates in excess of the reserves required thereunder, but the contractual rights of any insured member shall not be affected thereby.
(8) A society [neglecting] doing business in this state that fails to file the annual statement in the form and within the time provided by this section shall [forfeit] pay a late filing fee of one hundred seventy-five dollars per day for each day [during which such neglect continues] from the due date of such statement, and, upon notice by the commissioner to that effect, its authority to do business in this state shall cease while such [default] failure to file continues. The commissioner may waive the late filing fee if (1) the society cannot file such statement because the governor of such society's state of domicile has proclaimed a state of emergency in such state and such state of emergency impairs the society's ability to file the statement, or (2) the insurance regulatory official of the state of domicile of a foreign benefit society has permitted the society to file such statement late.
(9) Notwithstanding the provisions of this section, a society may, with the approval of the Insurance Commissioner, use the standards for valuation and nonforfeiture authorized by the provisions of sections 38a-61, 38a-77, 38a-78, 38a-81, 38a-82, 38a-284, 38a-287, 38a-430 to 38a-454, inclusive, and 38a-458.
Sec. 12. Section 38a-741 of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(a) The commissioner shall maintain on a current basis a list of those lines of insurance or their components for which coverages are believed by the commissioner to be generally unavailable from licensed insurers. The commissioner shall republish the list and make it available to all licensees every six months. Any person may request in writing that the commissioner add or remove a line of insurance or its component from the current list at the next publication of the list. The commissioner's determinations of lines of insurance or their components to be added to or removed from the list shall not be subject to chapter 54 provided prior to making determinations, the commissioner shall provide opportunity for comments from interested persons.
(b) (1) When any policy of insurance is procured under the authority of such license providing a line of insurance or its component that does not, on the effective date of coverage, appear on the current published list, both the licensee and the insured shall [execute affidavits] write signed statements setting forth facts showing that such licensee and such insured were unable after diligent effort to procure, from any authorized insurer or insurers, the full amount of insurance required to protect the interest of such insured, and further showing that the amount of insurance procured from an unauthorized insurer or insurers is only the excess over the amount so procurable from authorized insurers. Such licensee shall file such [affidavits] signed statements with the commissioner [not later than forty-five days after such policies have been procured] in an electronic format on the first day of February, May, August and November in each year.
(2) The provisions of subdivision (1) of this subsection shall not apply to any policy of insurance procured under the authority of such license for an insured that is an exempt commercial purchaser, as defined in Section 527 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, P.L. 111-203, as amended from time to time, provided (A) the surplus lines broker has disclosed to such exempt commercial purchaser that such insurance may or may not be available from an authorized insurer, that may provide greater protection with more regulatory oversight, and (B) such exempt commercial purchaser has subsequently requested such broker, in writing, to procure such policy from an unauthorized insurer.
Sec. 13. Section 38a-777 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
Any licensee under sections 38a-741 to 38a-744, inclusive, as amended by this act, or section 38a-794 who negotiates, continues or renews any contract for insurance in any unauthorized company, and who neglects to make and file the [affidavit and] statements required [by said sections] under section 38a-741, as amended by this act, or who wilfully makes a false [affidavit or] statement, or who negotiates, continues or renews any such contract of insurance after the revocation or during the suspension of the licensee's license, shall forfeit the license if not previously revoked and shall be fined not more than four thousand dollars or imprisoned not more than six months, or both.
Sec. 14. Subdivision (3) of subsection (k) of section 38a-660 of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(3) There is established an account to be known as the "surety bail bond agent examination account", which shall be a separate, nonlapsing account within the Insurance Fund established under section 38a-52a. The account shall contain any moneys required by law to be deposited in the account and any such moneys remaining in the account at the [close of the fiscal] end of each calendar year shall be transferred to the General Fund.
Sec. 15. Section 38a-477b of the 2012 supplement to the general statutes is repealed. (Effective from passage)
This act shall take effect as follows and shall amend the following sections: | ||
Section 1 |
from passage |
38a-8 |
Sec. 2 |
October 1, 2012 |
38a-11(a) |
Sec. 3 |
October 1, 2012 |
38a-130(a) |
Sec. 4 |
October 1, 2012 |
38a-14 |
Sec. 5 |
October 1, 2012 |
38a-53 |
Sec. 6 |
from passage |
31-331 |
Sec. 7 |
October 1, 2012 |
38a-162 |
Sec. 8 |
October 1, 2012 |
38a-163 |
Sec. 9 |
October 1, 2012 |
38a-188 |
Sec. 10 |
October 1, 2012 |
38a-436 |
Sec. 11 |
October 1, 2012 |
38a-614 |
Sec. 12 |
from passage |
38a-741 |
Sec. 13 |
from passage |
38a-777 |
Sec. 14 |
from passage |
38a-660(k)(3) |
Sec. 15 |
from passage |
Repealer section |
INS |
Joint Favorable Subst. |