Life and Health News December 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
Kentucky adopted by reference the July 2011 edition of the Annuity Buyer's Guide.     Regulation 806 KAR 12:150


AUTISM
New York amended its law in relation to coverage for the screening, diagnosis and treatment of autism spectrum disorder.     Ch. 595 A. 6305-A, Ch. 596 S. 5845


CIVIL UNION
Delaware issued a bulletin providing guidance regarding the implementation of the Civil Union and Equality act of 2011.     Bulletin 46


DISASTER OR CATASTROPHIC EVENT
Connecticut issued three separate bulletins on November 2, 2011.  One bulletin provides guidance to insurers regarding the October storm.  Insurers are encouraged to use all available means to provide prompt and immediate relief to policyholders impacted by the storm, including but not limited to the temporary suspension of premium payments to allow continuing insurance coverage.  Bulletin IC-34 (#2) clarified to all health insures how to handle individual and group health insurance claims for disaster victims and evacuees during a state of emergency.     Bulletin IC-32 (Reissued), Bulletin IC-32 (#2), Bulletin IC-34 (#2)


EXTERNAL AND INTERNAL REVIEW
South Dakota amended its external and internal review requirements.     ARSD 20:06:53:72, 20:06:53:73, 20:06:53:78, 20:06:53:79, 20:06:53:80


EXTERNAL REVIEW
Oklahoma adopted emergency regulations to implement uniform standards for the establishment and maintenance of external procedures to assure the opportunity for an independent review of an adverse determination or final adverse determination, as defined in the Uniform Health Carrier External Review Act.     365:10-29-1 thru 365:10-29-10


FILING REQUIREMENTS
Colorado amended rate filing requirements for health insurance policies.     Regulation 4-2-11


FINANCIAL REGULATION
California adopted a regulation regarding the standards for determining if benefits of an individual hospital, medical or surgical policy are unreasonable in relation to the premium charged.     10 CCR § 2222.12

Florida adopted by reference the 2010 and 2011 editions of the NAIC Financial Condition Examiners Handbook.     Rule 69O-138.001

Florida amended its rule regarding valuation of life insurance policies.     Rule 69O-164.020

Ohio issued a bulletin to address the definitions of small and large employers for purposes of medical loss ratio (MLR) reporting and rebate requirements.     Bulletin 2011-9

Pennsylvania issued a notice and record retention guidelines to assist insurers in establishing appropriate record retention procedures for purposes of financial and market conduct examinations conducted by the Insurance Department.     Notice 2011-10

South Carolina informed health insurance issuers of the new rate requirements and filing procedures that the Department is adopting.     Bulletin 11-2011


FRAUD
New Hampshire adopted a new rule establishing guidelines and standards for antifraud plans including reporting requirements for insurer antifraud investigative units.     Ins Rule 4600


GROUP
South Dakota issued a bulletin to insurers filing small group association and trust health insurance rate increases.  Small employer carriers are now required to file base rates for approval before increasing its rates on small employers.     Bulletin 2011-7


INTERSTATE INSURANCE PRODUCT REGULATION COMMISSION
Indiana opted out of the long-term care uniform standards of the interstate compact commission and provides definitions.     760 IAC 2-21-1, 760 IAC 2-21-2


LIFE INSURANCE DISCLOSURES
Kentucky adopted the Life Insurance Buyer's Guide by reference.     Regulation 806 KAR 12:170


LIMITED PURPOSE SUBSIDIARIES
Georgia authorized establishment and governs operation of domestic limited purpose subsidiary insurance companies wholly owned by organizing domestic reinsurers.     Regulation 120-2-100-.01+


LONG-TERM CARE
New Jersey provided notice of an adjustment in the alternate interest rates used in rate submissions for certain long-term care insurance policies.     Public Notice Dated November 7, 2011

Washington adopted new rules establishing minimum standards and disclosure requirements for the sale of long-term care partnership insurance policies.     Rule WAC 284-83-140+


MEDICARE SUPPLEMENT
Ohio adopted a rule regarding the solicitation and sale of Medicare supplemental accident and health policies.     Admin. Code § 3901-8-09


MISCELLANEOUS
California issued a notice regarding the financial solvency examination fee schedule for fiscal year 2011-2012.     Notice Dated October 24, 2011

Maine issued a bulletin that notifies insurers about use of federal "safe harbor" form to comply with Gramm-Leach-Bliley Act provisions as well as state privacy requirements.     Bulletin 379

Maryland issued a bulletin reminding insurers required to file an annual statement, that they must also file a Certificate of Compliance.     Bulletin 11-32

Nebraska issued a notice informing insurers that effective May 1, 2012, the Nebraska Department of Insurance will no longer require insurance agency branches to be licensed.     Notice Dated November 1, 2011


MISCELLANEOUS - HEALTH
Maryland enacted legislation regarding its health benefit plan quality and performance evaluation system for each carrier that participates.     COMAR 10.25.08.01, 10.25.08.02, 10.25.08.03, 10.25.08.04, 10.25.08.05, 10.25.08.06

Oregon adopted new rules relating to registration of contracting entities entering into contracts for provider leasing.     OAR 836-200-0250, 836-200-0255

Virginia amended its definition section pertaining to the certification of managed care health insurance providers.  It revised the definition of "emergency services" and added definitions for "health care services," "health carrier," and "network".     12 VAC 5-408-10


MISCELLANEOUS - LIFE
Florida adopted a new regulation on guidelines and standards on the use of recognized designations used for marketing and the sale of insurance products.     Rule 69B-215.235

Louisiana adopted a new regulation regarding broker-dealer and investment adviser recordkeeping requirements.     Regulation 1701+

Louisiana adopted a rule to provide guidelines for the supervision of securities salesmen and investment adviser representatives.     Regulation 1901

New Jersey amended form filing provisions in several life insurance and annuity rules to indicate the rules do not apply to forms approved by the interstate compact.  These include rules related to individual and group life and individual annuity contract standards, 40-state file and use procedure and unfair discrimination.     Rule 11:4+

Ohio adopted a new regulation implementing standards of conduct and responsibility applicable to insurance license applicants, licensees, and/or companies licensed or authorized to transact the business of insurance.  This rule replaces Rule 3901-1-40.     Rule 3901-5-12, Rescission Of Rule 3901-1-40

South Dakota amended its law regarding the disclosure requirements for life insurance policies.     ARSD 20:06:14:04


MORTALITY TABLE
Florida adopted a rule allowing use of 2001 CSO preferred class structure mortality table for certain policies issued prior to January 1, 2007, with consent of the Insurance Commissioner and subject to certain conditions.  The rule is applicable to valuation dates beginning with December 31, 2010, for policies issued on or after January 1, 2005, for policies not issued in Florida, and on or after June 8, 2005, for policies issued in Florida.     Rule 69O-162.203

Oregon amended to their rules to reflect changes to the NAIC Model Regulation #815. The amendments allow a company to substitute the 2001 CSO Preferred Mortality Tables in place of the 2001 CSO Smoker or Nonsmoker Mortality Tables for policies issued prior to January 1, 2007.  The conditions for use of the preferred tables are also set out in the rules.     OAR 836-031-0810,


PATIENT PROTECTION AND AFFORDABLE CARE ACT
Mississippi issued a bulletin regarding application requirements and appointment procedures for the establishment of its health insurance exchange advisory board and subcommittees required by Patient Protection and Affordable Care Act.     Bulletin 2011-9

Puerto Rico issued a bulletin to all disability insurers and health service organizations writing medical insurance regarding the preventative care service coverage that must be provided without imposing cost-sharing, additional cost, coinsurance or deductible requirements.     Ruling AV-132-2011


PRE-NEED
Texas repealed sections of its rules concerning investment of trust funds related to prepaid funeral benefits and amended its pre-paid funeral contract regulations.     Repeal of Rule 7 TAC 25.51+, Rule 7 TAC 25.17+


PRESCRIPTIONS
New York amended its insurance law in relation to prescription coverage for eye drops.     A. 1219


PRODUCERS
Hawaii revised its previous memorandum to recognize annuity producer training courses completed in other jurisdictions.     Revised Memorandum 2011-2LIC

Illinois enacted legislation requiring that individual life or accident and health applications and a master policy applications for life or accident and health group coverages bear the name and signature of the licensee who solicited and wrote the application.     House Bill 1128

Kentucky amended its continuing education regulation by adding a section specific to the sale, solicitation or negotiation of annuities.     Regulation 806 KAR 9:220

Ohio adopted a rule setting forth standards of conduct and responsibility applicable to insurance license applicants, licensees, and/or companies licensed or authorized to transact the business of insurance by the superintendent of insurance.     Admin. Code 3901-5-12

Oklahoma issued a notice for insurers regarding the appointment renewal process.     Producer Notice 10-31-11

Utah issued a bulletin that clarifies its interpretation of recent legislation on inducements in connection with the sale, continuation or termination of an insurance contract.     Bulletin 2011-6


REGULATORY ASSET ADEQUACY
Florida adopted a rule adding an additional requirement to the Regulatory Asset Adequacy Issues Summary and requiring disclosure of significant interim results, such as the impact of the insufficiency of assets to support payment of benefits and expenses and the establishment of statutory reserves.     Rule 69O-138.047


RETAINED ASSET ACCOUNTS
Kentucky Advisory Opinion 10-06 has been replaced by statute, KRS 304.12-035 ("Beneficiaries Bill of Rights"), which governs use of retained asset accounts.     Withdrawal of Advisory Opinion 10-06

Maryland repealed regulations COMAR 31.09.14.01–.05. S.B. 217 (Ch. 38, Acts of 2011) pertaining to provisions on retained asset accounts.  These regulations are no longer necessary due to the enactment of Senate Bill 217, effective 10/1/11.     Repeal of Regulation 31.09.14.01+

North Carolina issued a notice reminding life insurers of the standards regarding the payment of life insurance benefits to a beneficiary by means of a “retained asset account.”     Advisory Notice Dated September 12, 2011


SUITABILITY
Alaska amended its law regarding annuity suitability provisions on producer training, duties of producers and insurers, and record retention.     Regulation 3 AAC 26.770+

Illinois issued a bulletin clarifying amendments to certain suitability and supervisory standards for producers and insurers making recommendations for the purchase or exchange of annuities.     Bulletin 2011-13

Maryland amended its law regarding standards and procedures for recommendation to a consumer that results in a transaction involving an annuity product.  It revised among other things, the duties of insurers and producers, the definition section, its supervision system, and producer training.     COMAR 31.09.12.01, COMAR 31.09.12.02, COMAR 31.09.12.03, COMAR 31.09.12.04, COMAR 31.09.12.05+


TRADE PRACTICES
New Jersey issued a bulletin regarding rebates and inducements.  The bulletin clarifies the intent of statutes and rules prohibiting the delivery by producers or insurers of certain services or other offerings for free or at a discounted price.  The bulletin provides examples of services that are not considered prohibited rebates along with examples of prohibited rebates or inducements.     BULLETIN NO. 11-22


 UCAA Expertise

First Consulting is experienced with the Uniform Certificate of Authority Application (UCAA). We can assist your Company with applications for approval of a:

  • Name Change
  • Redomestication
  • Acquisition
  • Merger
  • Additional Line of Business
  • Authority in an Additional Jurisdiction

Contact John Palmer or Scott Sheffer for more details.

John Palmer                                                            Scott Sheffer
John.palmer@firstconsulting.com                        scott.sheffer@firstconsulting.com
816-391-2744                                                          816-391-2742 

 


Compliance Resources at your Fingertips

Are you aware of the free compliance resources that First Consulting makes available to you?

At First Consulting & Administration, we know that keeping up with the ever-changing laws and regulations applicable to insurance is time-consuming and challenging.  That is why we have made available complimentary research on our website (click here to access).  This research addresses a variety of topics, including:

  • Extraterritorial Jurisdiction Filing Requirements for Life & Health Insurers
  • Life and Annuity Application State Variations
  • Reinstatement of Life Insurance
  • And more!

Contact me or any First Consulting associate for more information if you have questions about these resources or any other First Consulting services. 

Sean Cox
sean.cox@firstconsulting.com
816-391-2737 or 800-927-2730


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