Life and Health News August 2011

The following is a brief review of selected items that may be of current interest to First Consulting & Administration, Inc. clients and friends.  Please feel free to copy it for distribution to your staff.  Contact us for more details about any item.  We welcome your comments and suggestions on this letter.  Please call our office.


ANNUITIES
Colorado amended its suitability in annuity transactions rule to modify sections on definitions, insurers and insurance producer duties, producer training requirements, severability, and enforcement.     Regulation 4-1-11

Iowa issued a bulletin encouraging insurance companies to put safeguards in place to prevent or limit their exposure to stranger-originated annuity transactions.     Bulletin 11-05


DISASTER OR CATASTROPHIC EVENT
Iowa issued two bulletins providing guidance regarding cancellation, nonrenewal, premium deferral and other issues related to the floods and natural disasters of May and June 2011.  A list of associated questions and answers is also included on the department's website. Iowa also issued multiple memorandums addressing questions and providing answers regarding Bulletins 11-02 and 11-03.     Bulletin 11-02, Bulletin 11-03, Memorandum Dated June 27, 2011, July 11, 2011, July 18, 2011


FILING REQUIREMENTS
Wisconsin extended its emergency rule, until September 6, 2011.   It returns the required minimum readability score, Flesch or equivalent, back to 40 and repeals certain provisions related to policy language simplification.     Emergency Rule 6.07


FINANCIAL REGULATION
Delaware enacted legislation providing additional investment flexibility to domestic insurers that are well capitalized.     Senate Bill 53

Idaho issued a bulletin notifying life insurers of the minimum interest rate for deferred payment of cash surrender benefits and providing details on when payment of such benefits is deemed deferred.     Bulletin No. 11-06

Montana adopted a new rule establishing guidelines, standards and requirements for insurers' investment in derivative instruments.     Rule I+

Pennsylvania issued a notice providing an updated schedule of per diem charges for financial examinations conducted by the Insurance Department.     Notice 2011-05

Texas issued a bulletin to health insurers pertaining to the definition of "small employer" and "larger employer" for purposes of medical loss ratio (MLR) reporting and rebate requirements.     BULLETIN #B-0028-11


GUARANTY ASSOCIATION
Oklahoma updated the language for the notice requirements on the coverage and non-coverage of a policy by the Oklahoma Life and Health Guaranty Association Act.     Rule 365:10-1-6


HEALTH GRIEVANCE REVIEW PROCESS
Utah amended its provisions on adverse benefit determination, record retention, and definitions.     Rule R590-203-1+


HIV
Pennsylvania amended its law regarding confidentiality of HIV-related information.     Senate Bill 260


INTERSTATE INSURANCE PRODUCT REGULATION COMMISSION
Oregon enacted legislation making the state a member of the Interstate Insurance Product Regulation Commission effective January 1, 2012.     House Bill 2095


LONG-TERM CARE
Texas issued a bulletin requesting rate information on individual long-term care insurance for new customers in Texas.     Bulletin #B-0030-11


MARKET CONDUCT
Pennsylvania issued a notice providing an updated schedule of per diem charges for market conduct examinations conducted by the Insurance Department.     Notice 2011-04


MISCELLANEOUS
Georgia issued a bulletin that notifies insurers that legal reference in Bulletin 87-EX-1 to prohibition on imposition of fees to cover surcharges incurred with use of credit card to purchase insurance is no longer accurate.     Bulletin 11-EX-2

Illinois issued a bulletin reminding domestics of the appropriate procedures for seeking approval to establish certain separate accounts.     Bulletin 2011-08

Louisiana enacted legislation that stipulates methods of transmitting policies and supporting documents, and provides for electronic transaction of documents.     House Bill 275

Maryland issued a bulletin to all insurers notifying them of the required format of electronic submissions of the Report on Slavery Era Insurance and provides a reminder of the October 1, 2011, due date.     Bulletin 11-15

North Carolina enacted legislation authorizing premium payments using debit cards, and permitting the Commissioner of Insurance to approve nontraditional groups for group life insurance.     House Bill 373

Puerto Rico issued a circular letter with the protocol for the detection and prevention of the financial exploitation of older persons.  It clarifies that Rule 93 is binding on all insurers and health service organizations.     Circular Letter 2011-1815-IA

Texas issued a bulletin giving instructions for the quarterly consumer information data call for the 2011 second quarter.  It must be completed and returned in accordance with the instructions no later than August 24, 2011.  This is a firm deadline, and no extensions will be granted.  Responses should reflect year-to-date experience (January 1 -- June 30, 2011), and reported experience should be valued as of June 30, 2011.     Bulletin B-0034-11

The District of Columbia issued a bulletin to all persons engaged in the business of insurance that outlines revised procedures for filing applications for written consent to engage in the business of insurance pursuant to 18 USC 1033.     Bulletin 11-IB-01-06/20


MISCELLANEOUS - HEALTH
Louisiana provided age restrictions for health insurance benefits coverage, which includes among other things, unmarried dependent child or grandchild, an unmarried dependent child or grandchild with mental retardation or physical handicap, optional continuous coverage regardless of age, and requires dependent grandchild be in the legal custody of and residing with the grandparent to qualify.     House Bill 463

Texas issued a bulletin clarifying the submission requirements for the health care claims reimbursement rate report that health insurers need to submit by September 1, 2011 for reporting period January 1, 2011 to June 30, 2011.     Bulletin #B-0033-11

Utah amended its unfair accident and health claims settlement practices rule, which among other things, revises the adverse benefit determination definition, notification of the benefit determination requirements, and minimum standards for claim benefit determination and settlement.     Rule R590-192

Virginia issued a letter to all health, dental and optometric insurers to provide a summary of the new internal appeals and external review process under Virginia law.  It provides guidance for the submission of form filings and complaint system filings revised to comply with these new requirements.     Administrative Letter 2011-5


MISCELLANEOUS - LIFE
Delaware authorized the courts to require a party to designate a minor child(ren) covered under a support order as beneficiary of the parties' life insurance policies for the term of the support order.     House Bill 132


MORTALITY TABLES
Washington adopted a new rule that establishes requirements for use of mortality tables that reflect differences in mortality between preferred and standard lives in determining minimum reserve liabilities.  It follows the NAIC model regulation.     Rule WAC 284-74-470+


OMNIBUS LEGISLATION
Alaska amended it laws including, but not limited to, long-term care, guaranty association, premium taxes, life insurance policies, and annuity policy contracts.     House Bill 164

Nevada enacted legislation, which among other things, amends requirements relating to external review of adverse decisions by managed care organizations, provisions relating to electronic signatures, filing requirements for group contracts, guaranty association coverage, definition of employee for certain benefit plans, actuary damage liability and defines unallocated annuity contract.     Assembly Bill 74

North Carolina enacted legislation concerning several topics.  Included in the bill are requirements for premium rates for health benefit plans, amendments to the risk-based capital law and it defines nondependent child coverage and open enrollment.     House Bill 298


PATIENT PROTECTION AND AFFORDABLE CARE ACT
Connecticut enacted legislation concerning health care reform, implements the Patient Protection and Affordable Care Act and defines health benefit plan.  Connecticut also issued a bulletin to health insurers regarding rescission and eligibility reviews.     House Bill 6308, Bulletin HC-85

Mississippi issued a bulletin putting all health insurance issuers on notice regarding the submission requirements for health insurance rates increases any time on or after September 1, 2011.  This bulletin does not apply to Medicare Supplement policies, Long Term Care policies, Supplemental Medical Insurance policies and any other health policies specifically excluded from the provisions of Patient Protection and Affordable Care Act.     Bulletin 2011-7


PREMIUM REVIEW
Arkansas issued a bulletin pertaining to premium review for small employer group major medical policies.     Bulletin 7-2011


PREMIUM TAXES
Arizona enacted legislation, which among other things, enacts laws creating premium tax credits for new employment.     House Bill 2001b


PRODUCERS
Indiana issued a bulletin providing a summary and guidance regarding significant changes made to the licensing laws that apply to producers selling annuity products and/or variable life and annuity products.     Bulletin 184

Iowa issued a bulletin providing guidance to insurance producers regarding permissible and prohibited activities of “Insurance-Only Persons” and “Securities-Only Persons”.     Bulletin 11-4

Iowa issued a bulletin that clarifies permitted and prohibited activities of persons licensed to sell life insurance and annuities and licensing requirements.     Bulletin 11-S-1

Louisiana updated its requirements for education, continuing education and prelicensing requirements for producers.     Regulation 9, Regulation 10

North Carolina amended its licensee requirements for certain life and health agents.     Rule 11 NCAC 06A .0802

Oklahoma amended various rules regarding producer licensing requirements, licensing applications and continuing education. The rules include variable product licensing.     Rule 365:25-3-1+, Rule 365:1-9-11+


RETAINED ASSET ACCOUNTS
Rhode Island enacted the Beneficiaries' Bill of Rights Act of 2011, which requires complete and proper disclosure, transparency, and accountability relating to any method of payment for life insurance death benefits and requires that beneficiaries are fully informed in bold type and in layman's language of their options.     House Bill 5244, Senate Bill 45


SALES TO SENIORS
New York adopted an emergency regulation that establishes standards and requirements for use of senior-specific certifications and designations in the sale of life insurance and annuities.     Emergency Regulation 199 (11 NYCRR 225)


SUITABILITY
New York adopted a new emergency regulation establishing standards and procedures to determine a consumers' suitability before recommending or selling annuities. This emergency regulation is substantially similar to the NAIC Suitability in Annuity Transactions Model Regulation.    Emergency Reg. 187 (11 NYCRR 224)


THIRD PARTY ADMINISTRATOR
Connecticut enacted a substantially similar version of the NAIC Third Party Administrator Act.     House Bill 6308


UNFAIR TRADE PRACTICE
Connecticut enacted legislation making it an unfair trade practice to refuse to insure, continue to insure or limit coverage available to an individual or charge an individual a different rate for the same coverage because of a mental or nervous condition.     Senate Bill 314


 Co-Sourcing - Unique Solutions to Unique Compliance Needs

First Consulting & Administration, Inc. assists clients with their unique regulatory and compliance problems by Co-Sourcing with unique solutions.

Co-Sourcing with First Consulting means you always remain in control.  You determine how and when your project will be handled, and you decide exactly what aspects of your project you want us to handle.  We are serious about meeting the unique needs and requirements of each client and each project.
 

Contact John Palmer or any First Consulting associate to discover how Co-Sourcing can benefit you. 

 John B. Palmer
First Consulting & Administration, Inc.
1020 Central, Suite 201, Kansas City, Missouri 64105
800-927-2730, ext. 2744 or 816-391-2744

john.palmer@firstconsulting.com

 


Let Us Help You Enter The
Excepted Benefits Market

Many carriers are expanding into the Excepted Benefits Market, including products such as Accident Only, Critical Illness, Dental/Vision and others.  First Consulting can help you with this endeavor. 

  • Experienced Drafting & Filing
  • Customized Research
  • Group and Individual Expertise

Contact Jerry Wickersham, or any First Consulting associate, for more information about how First Consulting & Administration, Inc. can help your company.

 

Jerry L. Wickersham
First Consulting & Administration, Inc.
1020 Central, Suite 201, Kansas City, Missouri 64105
800-927-2730, ext. 2743 or 816-391-2743
jerry.wickersham@firstconsulting.com


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