Life and Health News March 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.


ACTUARIAL OPINION AND MEMORANDUM
Louisiana amended its regulations to comply with the national asset adequacy analysis standard of the NAIC Accreditation Team.     Regulation 47

Pennsylvania modified its requirements for the content of a regulatory asset adequacy issues summary in actuarial memorandum to require the inclusion of a statement regarding the impact of the insufficiency of assets to support the payment of benefits and expenses and the establishment of statutory reserves during one or more interim periods.     Regulation 84b.9


ADVERTISING
New Jersey repealed its advertising filing requirements for specified disease and critical illness coverages.     N.J.A.C. 11:4-53.7

Virginia repealed Chapter 40 on life insurance and annuity marketing practices and adopted new rules, which among other things, address and clarify advertising requirements, retain some of the rules from Chapter 40, and more closely follow the NAIC model regulation.     Repeal of Chapter 40, Chapter 41


ANNUITIES
New York issued a circular letter notifying insurers of their responsibility to provide annuity contract owners with a disclosure notice explaining the impact of an excess withdrawal on guaranteed minimum withdrawal benefits.     Circular Letter 5 (2011)

Ohio rescinded and re-adopted a regulation that requires insurers, including fraternal benefit societies, to establish a system to supervise recommendations and to set forth standards and procedures for recommendations to consumers that result in transactions involving annuity products. This is effective 07/01/11.     Rescission & Re-Adoption of Rule 3901-6-13

Oregon adopted a rule requiring insurers to establish standards and procedures for recommendations to consumers that result in transactions involving annuity products and ensures that producers who sell annuities receive proper training.     Rule 836-080-0170+

Texas adopted a rule specifying annuity disclosure requirements for both individual and group annuities.     Rule 28 TAC 3.9701+


CIVIL UNION
Illinois enacted the Religious Freedom Protection and Civil Union Act, which defines a civil union.  Persons entering into a civil union have the obligations, responsibilities, protections, and benefits afforded or recognized by the law of Illinois to spouses.     Senate Bill 1716


FILING REQUIREMENTS
Wisconsin adopted an emergency rule returning the required minimum readability score, Flesch or equivalent, back to 40 and repealing certain provisions related to policy language simplification.     Emergency Rule 6.07


FINANCIAL REGULATION
Pennsylvania amended its valuation of life insurance policies regulation to include amendments made to the NAIC Model Regulation.  These remove restrictions on mortality adjustment factors.     Regulation 84c.5

Puerto Rico established criteria and procedures to regulate the activities of insurance holding companies and insurers. These identify and prevent activities that may endanger the financial stability of an insurer.     Rule 83


GUARANTY ASSOCIATION
South Dakota revised the date when financial reports of the guaranty association are submitted to the director of insurance to May thirtieth of each year.     House Bill 1036


LONG-TERM CARE
Massachusetts issued a revised notice advising long-term care insurance companies of filing materials that should be submitted with initial rate and rate increase filings.     Notice 2009-C Revised

Oregon adopted rules to reflect the changes in the NAIC model relating to long-term care.  These include requirements for contact information and information to be provided quarterly about benefits paid.     OAR 836-052-0790

Utah adopted a rule allowing insurers to file rate increase requests without certification and when the commissioner may accept such premium rate increases without certification.     R590-148-24


MISCELLANEOUS
Arkansas issued a bulletin notifying insurers of the required use of the NAIC Accounting Practices and Procedures Manual for the December 31, 2011 annual statement.     Bulletin 1-2011

Kentucky adopted a regulation that establishes requirements for insurers to provide a notification of rights to life insurance policy owners. It allows insurers an exemption from providing the notice to policy owners with a net death benefit less than $100,000.     Regulation 806 KAR 15:090

Maryland issued a bulletin describing the emergency contact information that insurers must provide to the Maryland Insurance Administration by 4-15-2011.     Bulletin 2011-2

Nebraska issued a notice explaining the agency license renewal procedures for May 1, 2011 to April 30, 2012.     Notice 1-28-2011
 
Rhode Island revised a bulletin that provides notice of the Rhode Island Division of Taxation requirement for insurers to use the Online Premium Tax for Insurance (OPTins) system for payment of premium taxes.     Revised Bulletin Dated February 14, 2011


MISCELLANEOUS - HEALTH
Alaska issued a bulletin requiring health insurers to complete and return the annual survey of health insurance statistical information by May 1, 2011.  Please note that stop loss is considered as health insurance in Alaska.     Bulletin B 11-01

California amended its regulation regarding the standards for determining whether benefits of an individual hospital, medical or surgical policy are deemed to be reasonable in relation to premiums charged.     Regulation 2222.12

Colorado amended its requirements for standard policy provisions, which state the criteria for and extent of coverage for home health services and hospice care.     Regulation 4-2-8

Idaho has issued guidance about this year's health survey.  The survey must be completed online this year. Some additional forms will need to be completed.   Paper surveys will not be accepted.  Additional instructions can be found at the Departments website.     Email dated 02-23-11

Wisconsin issued a bulletin requiring insurers to use the individual uniform application form for all individual major medical health insurance policy applications. Insurers are also required to begin using the revised small employer uniform employee application for group health insurance.     Bulletin 2-1-2011


MORTALITY TABLES
Pennsylvania adopted a regulation allowing the substitution of the 2001 CSO Preferred Class Structure Mortality Table for 2001 CSO Smoker or Nonsmoker Mortality Table for certain life insurance policies.     Regulation 84d.3a


OMNIBUS LEGISLATION 
The District of Columbia enacted legislation applicable to health insurers, which among other things, protects victims of domestic violence from discrimination in the provision of insurance and bans inquiry, directly or indirectly, about whether an applicant or insured is or has been the victim of intrafamily offense, sexual attack, dating violence or stalking.     Bill 18-792


PATIENT PROTECTION AND AFFORDABLE CARE ACT
Colorado adopted a regulation revising the benefits for the basic and standard health benefit plans to incorporate the changes necessary to comply with the requirements of the federal Patient Protection and Affordable Care Act     Regulation 4-6-5

Illinois issued a bulletin offering health insurers assistance with the submission and approval of actuarial memorandum and justification review standard requirements.  The Department is providing a web portal through which electronic filings and actuarial memoranda may be electronically reported. This reporting process does not replace existing requirements for the submission of these materials through SERFF.     Bulletin 2011-2

Oregon repealed temporary rules OAR 836-100-0010(T) and 836-100-0015(T) and adopted permanent provisions, which prohibit insurers from limiting or denying coverage for persons under the age of 19 because of health status or a preexisting condition; establish uniform open enrollment periods; and provide insurers with standards for providing notice about these enrollment periods.     OAR 836-100-0010 and 836-100-0015

Washington amended health plan enrollment and coverage requirements for persons under the age of 19.     Emergency Rule 284-43-1010, 284-43-1015


PRODUCERS
Michigan issued a bulletin regarding the use of the words "insurance" and "agency" in a corporate insurance agency name.  Corporate insurance agencies may now use the word "insurance" without the word "agency" provided it is clear that the agency is not an insurance or surety company.     Bulletin 2011-01-INS

North Carolina has issued a memorandum regarding payment of 2011-2012 appointment renewals.     Memorandum 1-31-2011

Pennsylvania adopted new provisions on continuing education for insurance producers.     Regulation Chapter 39a, Repeal Of Chapter 39

Washington adopted a rule requiring certain licensing transactions to be made electronically and clarifying the electronic licensing process.     Rule WAC 284-17-001+


RETAINED ASSET ACCOUNTS
Connecticut issued a bulletin establishing disclosure standards on the payment of life insurance to a beneficiary by means of a retained asset account.     Bulletin IC-27

Iowa issued a bulletin that establishes disclosure standards for the payment of life insurance benefits to a beneficiary by means of a retained asset account.  Life insurers should be prepared to demonstrate compliance with this bulletin for all claims made on or after May 1, 2011.     Bulletin 11-01

Maryland adopted a regulation establishing exemptions to retained asset account claims settlement options disclosure requirements and amending disclosure language.     Regulation 31.09.14.05


REMINDER
MICHIGAN DATA CALL DUE 4-1-11

Have you complied with the Data Call filing required by the Michigan Insurance Department?  The data call response is due by April 1, 2011.

The data call was sent out in December, 2010, advising carriers that they must submit a copy of all life, annuity and health forms, including applications, certificates of insurance, and specification or schedule pages in use from January 1, 2005 through July 31, 2010.

First Consulting can help if you have not yet complied with this Data Call.
 
Click here to read more about the filing services offered by First Consulting.  Or, contact me or any First Consulting associate:

Jerry Wickersham
1-800-927-2730, ext 2743
jerry.wickersham@firstconsulting.com

                      
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