Bill Text: MO HB1968 | 2014 | Regular Session | Enrolled

Missouri House Bill 1968 (Prior Session Legislation)

MO State Legislature page for HB1968

Bill Title: Changes the laws regarding health organizations and risk-based capital

Spectrum: Partisan Bill (Republican 1-0)

Status: (Passed) 2014-06-19 - Delivered to Secretary of State (G) [HB1968 Detail]

Download: Missouri-2014-HB1968-Enrolled.html

SECOND REGULAR SESSION

[TRULY AGREED TO AND FINALLY PASSED]

SENATE COMMITTEE SUBSTITUTE FOR

HOUSE BILL NO. 1968

97TH GENERAL ASSEMBLY

5975S.02T 2014

AN ACT

To repeal sections 354.465, 375.1250, 375.1252, 375.1255, 375.1257, 375.1260, 375.1262, 375.1265, 375.1267, 375.1269, 375.1270, 375.1272, and 375.1275, RSMo, and to enact in lieu thereof thirteen new sections relating to health organizations.

Be it enacted by the General Assembly of the state of Missouri, as follows:

Section A. Sections 354.465, 375.1250, 375.1252, 375.1255, 375.1257, 375.1260, 375.1262, 375.1265, 375.1267, 375.1269, 375.1270, 375.1272, and 375.1275, RSMo, are repealed and thirteen new sections enacted in lieu thereof, to be known as sections 354.465, 375.1250, 375.1252, 375.1255, 375.1257, 375.1260, 375.1262, 375.1265, 375.1267, 375.1269, 375.1270, 375.1272, and 375.1275, to read as follows:

354.465. 1. The director, or any duly appointed representative, may make an examination of the affairs of any health maintenance organization as often as he deems it necessary for the protection of the interests of the people of this state, but not less frequently than once every [three] five years.

2. All costs incurred by the state as a result of making examinations under this section shall be paid by the organization being examined and remitted [directly to the examiner or examiners conducting the examination on billings approved by the director] as provided in section 374.160.

375.1250. As used in sections 375.1250 to 375.1275 and in the Risk-Based Capital (RBC) Instructions, the following terms mean:

(1) "Adjusted RBC report", an RBC report which has been adjusted in accordance with subsection 5 of section 375.1252;

(2) "Corrective order", an order issued by the director specifying corrective actions which the director has determined are required;

(3) "Director", the director of the department of insurance, financial institutions and professional registration;

(4) "Domestic health organization", a health organization domiciled in this state;

(5) "Domestic insurer", any insurance company domiciled in this state;

(6) "Foreign health organization", a health organization that is licensed to do business in this state under chapter 354 but is not domiciled in this state;

[(5)] (7) "Foreign insurer", any insurance company which is licensed to do business in this state under section 375.791, but is not domiciled in this state;

(8) "Health organization", a health services corporation, health maintenance organization, limited health service organization, dental or vision plan, hospital, medical and dental indemnity or service corporation, or other managed care organization licensed under chapter 354, but not an organization that is defined as a life and health insurer or property and casualty insurer by this section and otherwise subject to either the life or property and casualty RBC requirements;

[(6)] (9) "Life and health insurer", any insurance company licensed under chapter 376 or a licensed property and casualty insurer writing only accident and health insurance;

[(7)] (10) "NAIC", the National Association of Insurance Commissioners;

[(8)] (11) "Negative trend", with respect to life and health insurers, a negative trend over a period of time, as determined in accordance with the trend test calculations included in the RBC instructions;

[(9)] (12) "Property and casualty insurer", any insurance company licensed under chapter 379, but such term shall not include monoline mortgage guaranty insurers, financial guaranty insurers and title insurers;

[(10)] (13) "RBC instructions", the RBC report, including risk-based capital instructions adopted by the NAIC, as such RBC instructions may be amended by the NAIC from time to time in accordance with the procedures adopted by the NAIC;

[(11)] (14) "RBC level", an [insurer's] insurer or health organization's company action level RBC, regulatory action level RBC, authorized control level RBC, or mandatory control level RBC where:

(a) "Company action level RBC" means, with respect to any insurer or health organization, the product of 2.0 and its authorized control level RBC;

(b) "Regulatory action level RBC" means the product of 1.5 and its authorized control level RBC;

(c) "Authorized control level RBC" means the number determined under the risk-based capital formula in accordance with the RBC instruction; and

(d) "Mandatory control level RBC" means the product of .70 and the authorized control level RBC;

[(12)] (15) "RBC plan", a comprehensive financial plan containing the elements specified in subsection 2 of section 375.1255. If the director rejects the RBC plan and it is revised by the insurer or health organization, with or without the director's recommendation, the plan shall be called the "Revised RBC Plan";

[(13)] (16) "RBC report", the report required in section 375.1252;

[(14)] (17) "Total adjusted capital", the sum of:

(a) An [insurer's] insurer or health organization's statutory capital and surplus as determined in accordance with the statutory accounting applicable to the annual financial reports required to be filed under chapter 354 for health organizations, section 376.350 for domestic life and health insurers, section 379.105 for domestic property and casualty insurers and section 375.891 for foreign insurers; and

(b) Such other items, if any, as the RBC instructions may provide.

375.1252. 1. Every domestic insurer and every health organization shall, on or prior to each March first, prepare and submit to the director a report of its RBC level as of the end of the calendar year just ended, in a form and containing such information as is required by the RBC instructions. In addition, every domestic insurer and every domestic health organization shall file its RBC report:

(1) With the NAIC in accordance with the RBC instructions; and

(2) With the chief insurance regulatory official in any state in which the insurer or health organization is authorized to do business, if such official has notified the insurer or health organization of its request in writing, in which case the insurer or health organization shall file its RBC report not later than the later of:

(a) Fifteen days from the receipt of notice to file its RBC report with that state; or

(b) The filing date.

2. A life and health insurer's RBC shall be determined in accordance with the formula set forth in the RBC instructions. The formula shall take into account and may adjust for the covariance between:

(1) The risk with respect to the insurer's assets;

(2) The risk of adverse insurance experience with respect to the insurer's insurance liabilities and obligations;

(3) The interest rate risk with respect to the insurer's business; and

(4) All other business risks and such other relevant risks as are set forth in the RBC instructions. Such risks shall be determined in each case by applying the factors in the manner set forth in the RBC instructions.

3. A property and casualty insurer's RBC shall be determined in accordance with the formula set forth in the RBC instructions. The formula shall take into account and may adjust for the covariance between:

(1) Asset risk;

(2) Credit risk;

(3) Underwriting risk; and

4. A health organization's RBC shall be determined in accordance with the formula set forth in the RBC instructions. The formula shall take into account and may adjust for the covariance between:

(1) Asset risk;

(2) Credit risk;

(3) Underwriting risk; and

5. Insurers and health organizations should seek to maintain capital above the RBC levels required by sections 375.1250 to 375.1275, as such additional capital helps to secure an insurer against various risks inherent in, or affecting, the business of insurance and not accounted for or partially measured by the risk-based capital requirements contained in sections 375.1250 to 375.1275.

[5.] 6. If a domestic insurer or domestic health organization files an RBC report which in the judgment of the director is inaccurate, then the director shall adjust the RBC report to correct the inaccuracy and shall notify the insurer or health organization of the adjustment. The notice shall contain a statement of the reason for the adjustment. An RBC report as so adjusted is referred to as an "adjusted RBC report".

375.1255. 1. "Company action level event" means with respect to any insurer or health organization, any of the following events:

(1) The filing of an RBC report by the insurer or health organization which indicates that:

(a) The [insurer's] insurer or health organization's total adjusted capital is greater than or equal to its regulatory action level RBC but less than its company action level RBC; or

(b) If a life and health insurer, the insurer has total adjusted capital which is greater than or equal to its company action level RBC but less than the product of its authorized control level [capital] RBC and [2.5] 3.0, and has a negative trend;

(c) If a property and casualty insurer, the insurer has total adjusted capital which is greater than or equal to its company action level RBC but less than the product of its authorized control level RBC and 3.0 and triggers the trend test determined in accordance with the trend test calculation included in the property and casualty RBC report instructions;

(d) If a health organization has total adjusted capital which is greater than or equal to its company action level RBC but less than the product of its authorized control level RBC and 3.0 and triggers the trend test determined in accordance with the trend test calculation included in the health RBC instructions;

(2) The notification by the director to the insurer or health organization of an adjusted RBC report that indicates the event in paragraph (a), (b), [or] (c), or (d) of subdivision (1) of this subsection, if the insurer or health organization does not challenge the adjusted RBC report pursuant to section 375.1265;

(3) If pursuant to section 375.1265 the insurer or health organization challenges an adjusted RBC report that indicates the event described in subdivision (1) of this subsection, the notification by the director to the insurer or health organization that the director has, after a hearing, rejected the [insurer's] insurer or health organization's challenge.

2. In the event of a company action level event the insurer or health organization shall prepare and submit to the director an RBC plan which shall:

(1) Identify the conditions in the insurer or health organization which contribute to the company action level event;

(2) Contain proposals of corrective actions which the insurer or health organization intends to take and would be expected to result in the elimination of the company action level event;

(3) (a) Provide projections of the insurer's financial results in the current year and at least the four succeeding years, both in the absence of proposed corrective actions and giving effect to the proposed corrective actions, including projections of statutory operating income, net income, capital or surplus. The projections for both new and renewal business might include separate projections for each major line of business and separately identify each significant income, expense and benefit component;

(b) Provide projections of the health organization's financial results in the current year and at least the two succeeding years, both in the absence of proposed corrective actions and giving effect to the proposed corrective actions, including projections of statutory balance sheets, operating income, net income, capital and surplus, and RBC levels. The projections for both new and renewal business might include separate projections for each major line of business and separately identify each significant income, expense, and benefit component;

(4) Identify the key assumptions impacting the [insurer's] insurer or health organization's projections and the sensitivity of the projections to the assumptions; and

(5) Identify the quality of, and problems associated with, the [insurer's] insurer or health organization's business, including but not limited to its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business and use of reinsurance in each case, if any.

3. The RBC plan shall be submitted:

(1) Within forty-five days of the company action level event; or

(2) If the insurer or health organization challenges an adjusted RBC report pursuant to section 375.1265 within forty-five days after notification to the insurer or health organization that the director has, after a hearing, rejected the [insurer's] insurer or health organization's challenge.

4. Within sixty days after the submission by an insurer or health organization of an RBC plan to the director, the director shall notify the insurer or health organization whether the RBC plan shall be implemented or is, in the judgment of the director, unsatisfactory. If the director determines the RBC plan is unsatisfactory, the notification to the insurer or health organization shall set forth the reasons for the determination, and may set forth proposed revisions which will render the RBC plan satisfactory, in the judgment of the director. Upon notification from the director, the insurer or health organization shall prepare a revised RBC plan, which may incorporate by reference any revisions proposed by the director, and shall submit the revised RBC plan to the director:

(1) Within forty-five days after the notification from the director; or

(2) If the insurer or health organization challenges the notification from the director pursuant to section 375.1265, within forty-five days after a notification to the insurer or health organization that the director has, after a hearing, rejected the [insurer's] insurer or health organization's challenge.

5. In the event of a notification by the director to an insurer or health organization that the [insurer's] insurer or health organization's RBC plan or revised RBC plan is unsatisfactory, the director may at the director's discretion, subject to the [insurer's] insurer or health organization's right to a hearing under section 375.1265, specify in the notification that the notification constitutes a regulatory action level event.

6. Every domestic insurer or domestic health organization that files an RBC plan or revised RBC plan with the director shall file a copy of the RBC plan or revised RBC plan with the chief insurance regulatory official in any state in which the insurer is authorized to do business if:

(1) Such state has an RBC provision, substantially similar to subsection 1 of section 375.1267; and

(2) The chief insurance regulatory official of that state has notified the insurer or health organization of its request for the filing in writing, in which case the insurer or organization shall file a copy of the RBC plan or revised RBC plan in that state no later than the later of:

(a) Fifteen days after the receipt of notice to file a copy of its RBC plan or revised RBC plan with the state; or

(b) The date on which the RBC plan or revised RBC plan is filed under subsection 3 or 4 of this section.

375.1257. 1. "Regulatory action level event" means, with respect to any insurer or health organization, any of the following events:

(1) The filing of an RBC report by the insurer or health organization which indicates that the [insurer's] insurer or health organization's total adjusted capital is greater than or equal to its authorized control level RBC but less than its regulatory action level RBC;

(2) The notification by the director to an insurer or health organization of an adjusted RBC report that indicates the event in subdivision (1) of this subsection, if the insurer or health organization does not challenge the adjusted RBC report under section 375.1265;

(3) If, pursuant to section 375.1265, the insurer or health organization challenges an adjusted RBC report that indicates the event in subdivision (1) of this subsection, the notification by the director to the insurer or health organization that the director has, after a hearing, rejected the [insurer's] insurer or health organization's challenge;

(4) The failure of the insurer or health organization to file an RBC report by the filing date, unless the insurer or health organization has provided an explanation for such failure which is satisfactory to the director and has cured the failure within ten days after the filing date;

(5) The failure of the insurer or health organization to submit an RBC plan to the director within the time period set forth in subsection 3 of section 375.1255;

(6) Notification by the director to the insurer or health organization that:

(a) The RBC plan or revised RBC plan submitted by the insurer or health organization is, in the judgment of the director, unsatisfactory; and

(b) Such notification constitutes a regulatory action level event with respect to the insurer or health organization, where the insurer or health organization has not challenged the determination under section 375.1265;

(7) If, pursuant to section 375.1265, the insurer or health organization challenges a determination by the director under subdivision (6) of this subsection, the notification by the director to the insurer or health organization that the director has, after a hearing, rejected such challenge;

(8) Notification by the director to the insurer or health organization that the insurer or health organization has failed to adhere to its RBC plan or revised RBC plan, but only if such failure has a substantial adverse effect on the ability of the insurer or health organization to eliminate the company action level event in accordance with its RBC plan or revised RBC plan and the director has so stated in the notification provided the insurer or health organization has not challenged the determination under section 375.1265; or

(9) If, pursuant to section 375.1265, the insurer or health organization challenges a determination by the director under subdivision (8) of this subsection the notification by the director to the insurer or health organization that the director has, after a hearing, rejected the challenge.

2. In the event of a regulatory action level event the director shall:

(1) Require the insurer or health organization to prepare and submit an RBC plan or, if applicable, a revised RBC plan;

(2) Perform such examination or analysis as the director deems necessary of the assets, liabilities and operations of the insurer or health organization, including a review of its RBC plan or revised RBC plan; and

(3) Subsequent to the examination or analysis, issue an order specifying such corrective actions as the director shall determine are required.

3. In determining corrective actions, the director may take into account such factors as are deemed relevant with respect to the insurer or health organization based upon the director's examination or analysis of the assets, liabilities and operations of the insurer or health organization, including, but not limited to, the results of any sensitivity tests undertaken pursuant to the RBC instructions. The RBC plan or revised RBC plan shall be submitted:

(1) Within forty-five days after the occurrence of the regulatory action level event;

(2) If the insurer or health organization challenges an adjusted RBC report pursuant to section 375.1265, within forty-five days after the notification to the insurer or health organization that the director has, after a hearing, rejected the [insurer's] insurer or health organization's challenge; or

(3) If the insurer or health organization challenges a revised RBC plan under section 375.1265, within forty-five days after notification to the insurer or health organization that the director has, after a hearing, rejected the challenge.

4. The director may retain actuaries and investment experts and other consultants as may be necessary in the judgment of the director to review the [insurer's] insurer or health organization's RBC plan or revised RBC plan, examine or analyze the assets, liabilities and operations of the insurer or health organization and formulate the corrective order with respect to the insurer or health organization. The fees, costs and expenses relating to the consultants shall be borne by the affected insurer or health organization.

375.1260. 1. "Authorized control level event" means any of the following events:

(1) The filing of an RBC report by the insurer or health organization which indicates that the [insurer's] insurer or health organization's total adjusted capital is greater than or equal to its mandatory control level RBC but less than its authorized control level RBC;

(2) The notification by the director to the insurer or health organization of an adjusted RBC report that indicates the event in subdivision (1) of this subsection provided the insurer or health organization does not challenge the adjusted RBC report under section 375.1265;

(3) If, pursuant to section 375.1265, the insurer or health organization challenges an adjusted RBC report that indicates the event in subdivision (1) of this subsection, notification by the director to the insurer or health organization that the director has, after a hearing, rejected the [insurer's] insurer or health organization's challenge;

(4) The failure of the insurer or health organization to respond, in a manner satisfactory to the director, to a corrective order provided the insurer or health organization has not challenged the corrective order under section 375.1265; or

(5) If the insurer or health organization has challenged a corrective order under section 375.1265 and the director has, after a hearing, rejected the challenge or modified the corrective order, the failure of the insurer or health organization to respond, in a manner satisfactory to the director, to the corrective order subsequent to rejection or modification by the director.

2. In the event of an authorized control level event the director shall:

(1) Take such actions as are required under section 375.1257 regarding an insurer or health organization with respect to which a regulatory action level event has occurred; or

(2) If the director deems it to be in the best interests of the policyholders and creditors of the insurer or health organization and of the public, take such actions as are necessary to cause the insurer or health organization to be placed under regulatory control under sections 375.1150 to 375.1246. In the event the director takes such actions, the authorized control level event shall be deemed sufficient grounds for the director to take action pursuant to sections 375.1150 to 375.1246, and the director shall have the rights, powers and duties with respect to the insurer or health organization as are set forth in sections 375.1150 to 375.1246. In the event the director takes actions under this subdivision pursuant to an adjusted RBC report, the insurer or health organization shall be entitled to such protections as are afforded to insurers or health organizations pursuant to the provisions of sections 375.570 to 375.640, provided that the adjusted RBC report shall be deemed a report of examination.

375.1262. 1. "Mandatory control level event" means, with respect to any insurer or health organization, any of the following events:

(1) The filing of an RBC report which indicates that the [insurer's] insurer or health organization's total adjusted capital is less than its mandatory control level RBC;

(2) Notification by the director to the insurer or health organization of an adjusted RBC report that indicates the event in subdivision (1) of this subsection if the insurer or health organization does not challenge the adjusted RBC report under section 375.1265; or

2. In the event of a mandatory control level event the director shall take such actions as are necessary to place the insurer or health organization under regulatory control under sections 375.1150 to 375.1246, or, in the case of a property and casualty insurer which is writing no business, may allow the insurer to continue its existing policies until expiration of the policy term and settlement of all outstanding claims under the supervision of the director. In either event, the mandatory control level event shall be deemed sufficient grounds for the director to take action pursuant to sections 375.1150 to 375.1246, and the director shall have the rights, powers and duties with respect to the insurer or health organization as are set forth in sections 375.1150 to 375.1246. In the event the director takes actions pursuant to an adjusted RBC report, the insurer or health organization shall be entitled to such protections as are afforded to insurers or health organizations pursuant to the provisions of sections 375.570 to 375.640, if the adjusted RBC report shall be deemed a report of examination. Notwithstanding any other provision of this subsection to the contrary, the director may forego action for up to ninety days after the mandatory control level event if the director finds there is a reasonable expectation that the mandatory control level event be eliminated within the ninety-day period.

375.1265. 1. Upon:

(1) Notification to an insurer or health organization by the director of an adjusted RBC report; or

(2) Notification to an insurer or health organization by the director that:

(a) The [insurer's] insurer or health organization's RBC plan or revised RBC plan is unsatisfactory; and

(b) Such notification constitutes a regulatory action level event with respect to such insurer or health organization; or

(3) Notification to any insurer or health organization by the director that the insurer or health organization has failed to adhere to its RBC plan or revised RBC plan and that such failure has a substantial adverse effect on the ability of the insurer or health organization to eliminate the company action level event with respect to the insurer or health organization in accordance with its RBC plan or revised RBC plan; or

(4) Notification to an insurer or health organization by the director of a corrective order with respect to the insurer or health organization; the insurer or health organization shall have the right to a confidential departmental hearing, with a record made, at which the insurer or health organization may challenge any determination or action by the director. The insurer or health organization shall notify the director of its request for a hearing within five days after the notification by the director pursuant to this subsection. Upon receipt of the [insurer's] insurer or health organization's request for a hearing, the director shall set a date for the hearing, which date shall be no less than ten nor more than thirty days after the date of the [insurer's] insurer or health organization's request.

2. An insurer or health organization aggrieved by an order of the director after a hearing pursuant to subsection 1 of this section may obtain judicial review of such order pursuant to sections 536.100 to 536.140, except that:

(1) No insurer or health organization shall be deemed aggrieved unless the director has either:

(a) Made the director's order public; or

(b) Taken action pursuant to sections 375.1250 to 375.1275 or pursuant to sections 375.1165 to 375.1246; or

(2) If the director has taken action as described in paragraph (b) of subdivision (1) of subsection 1 of this section, judicial review pursuant to this section shall be consolidated with and be pendent to the action pursuant to the director's action.

3. There shall be no judicial review of any action by the director pursuant to sections 375.1250 to 375.1275 except as provided in subsection 2 of this section.

375.1267. 1. All RBC reports, to the extent the information therein is not required to be set forth in a publicly available annual statement schedule, and RBC plans, including the results or report of any examination or analysis of an insurer or health organization performed pursuant to this section and any corrective order issued by the director pursuant to examination or analysis, with respect to any domestic insurer [or], foreign insurer, health organization, or foreign health organization which are filed with the director constitute information that might be damaging to the domestic insurer [or], foreign insurer, health organization, or foreign health organization if made available to its competitors, and therefore shall be kept confidential by the director. This information shall neither be made public nor be subject to subpoena, other than by the director and then only for the purpose of enforcement actions taken by the director pursuant to sections 375.1250 to 375.1275 or any other provision of the insurance laws of this state.

2. The comparison of an [insurer's] insurer or health organization's total adjusted capital to any of its RBC levels is a regulatory tool which may indicate the need for possible corrective action with respect to the insurer or health organization, and is not intended as a means to rank insurers or health organizations generally. Therefore, except as otherwise required pursuant to the provisions of sections 375.1250 to 375.1275, the making, publishing, disseminating, circulating or placing before the public, or causing directly or indirectly, the making, publishing, disseminating, circulating or placing before the public, in a newspaper, magazine or other publication, or in the form of a notice, circular, pamphlet, letter or poster, or over any radio or television station, or in any other way, an advertisement, announcement or statement containing an assertion, representation or statement with regard to the RBC levels of any insurer or health organization, or of any component derived in the calculations by any insurer or health organization, agent, broker, or other person engaged in any manner in the business of insurance would be misleading and is therefore an unfair trade practice as defined in section 375.934; except that if any materially false statement with respect to the comparison regarding an [insurer's] insurer or health organization's total adjusted capital to its RBC levels or an inappropriate comparison of any other amount to the [insurer's] insurer or health organization's RBC levels is published in any written publication and the insurer or health organization is able to demonstrate with substantial proof the falsity of such statement, or the inappropriateness, as the case may be, then the insurer or health organization may publish an announcement in a written publication if the sole purpose of the announcement is to rebut the materially false statement.

3. The RBC instructions, RBC reports, adjusted RBC reports, RBC plans and revised RBC plans are intended solely for use by the director in monitoring the solvency of insurers and health organizations and the need for possible corrective action with respect to insurers or health organizations and shall not be used by the director for ratemaking nor considered or introduced as evidence in any rate proceeding nor used by the director to calculate or derive any elements of an appropriate premium level or rate of return for any line of insurance which an insurer, health organization, or any affiliate is authorized to write.

4. In order to assist in the performance of the director's duties, the director:

(1) May share documents, materials, or other information, including the confidential and privileged documents, materials, or information subject to subsection 1 of this section, with other state, federal, and international regulatory agencies, with the National Association of Insurance Commissioners and its affiliates and subsidiaries, and with state, federal, and international law enforcement authorities, provided that the recipient agrees to maintain the confidentiality and privileged status of the document, material, or other information;

(2) May receive documents, materials, or other information, including otherwise confidential and privileged documents, materials, or information from the National Association of Insurance Commissioners and its affiliates and subsidiaries and from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material, or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material, or information; and

(3) May enter into agreements governing sharing and use of information consistent with this subsection.

5. No waiver of any applicable privilege or claim of confidentiality in the documents, materials, or information shall occur as a result of disclosure to the director under this section or as a result of sharing as authorized in subdivision (3) of subsection 4 of this section.

375.1269. 1. The provisions of sections 375.1250 to 375.1275 are supplemental to any other provisions of the laws of this state, and shall not preclude or limit any other powers or duties of the director under such laws, including but not limited to sections 375.1150 to 375.1246.

2. The director may adopt reasonable rules and regulations necessary for the implementation of sections 375.1250 to 375.1275. No rule or regulation promulgated under authority of this section shall become effective unless it has been promulgated pursuant to the provisions of section 536.024.

3. The director may exempt from the provisions of sections 375.1250 to 375.1275 any domestic property and casualty insurer which:

(1) Writes direct business only in this state;

(2) Writes direct annual premiums of two million dollars or less; and

(3) Assumes no reinsurance in excess of five percent of direct premium written.

4. The director may exempt from the provisions of sections 375.1250 to 375.1275 any domestic health organization that:

(1) Writes direct business only in this state; and

(2) Writes direct annual premiums of two million dollars or less; and

(3) Assumes no reinsurance in excess of five percent of direct premium written; or

(4) Is a limited health service organization that covers less than two thousand lives.

5. There shall be no liability on the part of, and no cause of action shall arise against, the director, the department of insurance, financial institutions and professional registration or its employees or agents for any action taken by them in the performance of their powers and duties under sections 375.1250 to 375.1275.

375.1270. 1. Any foreign insurer or foreign health organization shall, upon the written request of the director, submit to the director an RBC report as of the end of the calendar year just ended the later of:

(1) The date an RBC report would be required to be filed by [an] a domestic insurer or domestic health organization under sections 375.1250 to 375.1275; or

(2) Fifteen days after the request is received by the foreign insurer or foreign health organization.

2. Any foreign insurer or foreign health organization shall, at the written request of the director, promptly submit to the director a copy of any RBC plan that is filed with the chief insurance regulatory official of any other state.

3. In the event of a company action level event regulatory action level event or authorized control level event with respect to any foreign insurer or foreign health organization as determined under the RBC statute applicable in the state of domicile of the insurer or, if no RBC provision is in force in that state, under the provisions of sections 375.1250 to 375.1275, if the chief insurance regulatory official of the state of domicile of the foreign insurer or foreign health organization fails to require the foreign insurer or foreign health organization to file an RBC plan in the manner specified under the RBC statute or, if no RBC provision is in force in the state, under section 375.1255, the director may require the foreign insurer or foreign health organization to file an RBC plan with the director. In such event, the failure of the foreign insurer or foreign health organization to file an RBC plan with the director shall be grounds to order the insurer or foreign health organization to cease and desist from writing new insurance business in this state, pursuant to the procedures set forth in section 374.046.

4. In the event of a mandatory control level event with respect to any foreign insurer or foreign health organization, if no domiciliary receiver has been appointed with respect to the foreign insurer or foreign health organization under the rehabilitation and liquidation statute applicable in the state of domicile of the foreign insurer or foreign health organization, the director may make application to the circuit court of Cole County permitted pursuant to section 375.1234 with respect to the liquidation of property of foreign insurers or foreign health organizations found in this state, and the occurrence of the mandatory control level event shall be considered adequate grounds for the application.

375.1272. All notices by the director to an insurer or health organization which may result in regulatory action under sections 375.1250 to 375.1275 shall be effective upon dispatch if transmitted by registered or certified mail, or in the case of any other transmission shall be effective upon the [insurer's] insurer or health organization's receipt of such notice.

375.1275. 1. For RBC reports required to be filed by life and health insurers with respect to 1993, the following requirements shall apply in lieu of the provisions of section 375.1255:

(1) In the event of a company action level event with respect to an insurer, the director shall take no regulatory action;

(2) In the event of a regulatory action level event pursuant to section 375.1257, the director shall take the actions required pursuant to section 375.1255;

(3) In the event of a regulatory action level event pursuant to section 375.1257 or an authorized control level event, the director shall take the actions required pursuant to section 375.1257 with respect to the insurer;

(4) In the event of a mandatory control level event with respect to an insurer, the director shall take the actions required pursuant to section 375.1260 with respect to the insurer.

2. For RBC reports required to be filed by property and casualty insurers with respect to 1996, the following requirements shall apply in lieu of the provisions of sections 375.1255 to 375.1262:

(1) In the event of a company action level event with respect to a domestic insurer, the director shall take no regulatory action under sections 375.1250 to 375.1275;

(2) In the event of a regulatory action level event under subdivision (1), (2) or (3) of subsection 1 of section 375.1257, the director shall take the actions required under section 375.1255;

(3) In the event of a regulatory action level event under subdivision (4), (5), (6), (7), (8) or (9) of subsection 1 of section 375.1257 or an authorized control level event, the director shall take the actions required under section 375.1257, with respect to the insurer;

(4) In the event of a mandatory control level event, the director shall take the actions required under section 375.1260 with respect to the insurer.

3. For RBC reports required to be filed by health organizations with respect to 2014, the following requirements shall apply in lieu of the provisions of sections 375.1255 to 375.1262:

(1) In the event of a company action level event with respect to a domestic health organization, the director shall take no regulatory action;

(2) In the event of a regulatory action level event under subdivisions (1) to (3) of subsection 1 of section 375.1257, the director shall take the actions required pursuant to section 375.1255;

(3) In the event of a regulatory action level event under subdivisions (4) to (9) of subsection 1 of section 375.1257 or an authorized control level event, the director shall take the actions required under section 375.1257 with respect to the health organization;

(4) In the event of a mandatory control level event with respect to a health organization, the director shall take the actions required under section 375.1260 with respect to the health organization.

4. The actions required under sections 375.1255 to 375.1262 or this section shall not apply to any insurer operating under the provisions of sections 287.900 to 287.920 which is under any order of supervision, including waivers of requirements for capital and surplus, issued or commenced by the director prior to August 28, 1996. This provision shall remain in effect until such order or proceeding expires or is otherwise terminated by further order of the director.

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