No. 28488 (Amendment): R590-226. Submission of Life Insurance Filings

DAR File No.: 28488
Filed: 02/01/2006, 03:36
Received by: NL

 

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this rule is to set forth the procedures for submitting life insurance filings and report filings required by Rule R590-177, Life Insurance Illustration Rule. The changes to this rule are being made to update publication dates of documents incorporated by reference; to remove references to the Accelerated Benefits Rule, R590-145, which was repealed 09/15/2005; and to clarify definitions in the rule.

 

Summary of the rule or change:

The changes to this rule are being made to update publication dates for documents incorporated by reference; to remove references to Rule R590-145; and to clarify definitions in the rule.

 

State statutory or constitutional authorization for this rule:

Sections 31A-2-201, 31A-2-201.1, and 31A-2-202

 

This rule or change incorporates by reference the following material:

Utah Life Filing Certification for Individual, dated June 2006; Utah Life Filing Certification for Group, dated June 2006; Utah Life, and Annuity, Credit Life, and Credit Accident and Health Group Questionnaire, dated June 2006; Utah Life, and Annuity, Credit Life, and Credit Accident and Health Request for Discretionary Group Authorization, dated June 2006; and Utah Annual Life Insurance Illustration Certification Filing Checklist, dated June 2006

 

Anticipated cost or savings to:

the state budget:

The amendments to this rule will create no change in the work done by department employees, nor will it change fees or revenues to the department and general fund.

 

local governments:

This rule does not affect local governments since it only applies to the relationship between the department and the licensed insurer.

 

other persons:

The changes to this rule will not change the filing requirements or duties of licensed life insurance companies nor will it create a financial impact on consumers. The rule is for clarification purposes only.

 

Compliance costs for affected persons:

The changes to this rule will not change the filing requirements or duties of licensed life insurance companies nor will it create a financial impact on consumers. The rule is for clarification purposes only.

 

Comments by the department head on the fiscal impact the rule may have on businesses:

This rule will have no financial impact on businesses. D. Kent Michie, Commissioner

 

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Insurance
Administration
Room 3110 STATE OFFICE BLDG
450 N MAIN ST
SALT LAKE CITY UT 84114-1201

 

Direct questions regarding this rule to:

Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at [e-mail]

 

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

03/17/2006

 

This rule may become effective on:

03/18/2006

 

Authorized by:

Jilene Whitby, Information Specialist

 

 

RULE TEXT

R590. Insurance, Administration.

R590-226. Submission of Life Insurance Filings.

R590-226-1. Authority.

This rule is promulgated by the insurance commissioner pursuant to Subsections 31A-2-201(3), 31A-2-201.1, and 31A-2-202(2).

 

R590-226-3. Documents Incorporated by Reference.

(1) The department requires that the documents described in this rule must be used for all filings. Actual copies may be used or you may adapt them to your word processing system. If adapted, the content, size, font, and format must be similar.

(2) The following documents are hereby incorporated by reference and are available on the department's website, www.insurance.utah.gov.

(a) "NAIC Life, Accident and Health, Annuity, Credit Transmittal Document," dated January 1, 200[5]6.

(b) "NAIC Uniform Life, Accident and Health, Annuity and Credit Coding Matrix," dated January 1, 200[5]6.

(c) "NAIC Instruction Sheet for Life, Accident and Health, Annuity, Credit Transmittal Document," dated January 1, 200[3]6.

(d) "NAIC Instruction Sheet for Life, Accident and Health, Annuity, Credit Transmittal Document Form Filing Attachment," dated January 1, 200[3]6.

(e) "Utah Life Filing Certification for Individual," dated [January 1, 2004]June 2006.

(f) "Utah Life Filing Certification for Group," dated June 2006.

([f]g) "Utah Life[,] and Annuity[, Credit Life, and Credit Accident and Health] Group Questionnaire," dated [January 1, 2004]June 2006.

([g]h) "Utah Life[,] and Annuity[, Credit Life, and Credit Accident and Health] Request for Discretionary Group Authorization," dated [January 1, 2004]June 2006.

([h]i) "Utah Annual Life Insurance Illustration Certification Filing Checklist," dated [January 1, 2004]June 2006.

 

R590-226-5. General Filing Information.

(1) Each filing document submitted within the filing must be accurate, consistent, and complete. Each filing must[and] contain all required documents in order for the filing to be processed in a timely and efficient manner. The commissioner may request any additional information deemed necessary.

(2) Insurers and filers are responsible for assuring compliance with Utah laws and rules. Filings not in compliance with Utah laws and rules are subject to regulatory action under Section 31A-2-308.

(3) Filing[s] that do not comply with this rule will be rejected and returned to the filer. Rejected filings are not considered filed with the department.

(4) Prior filings will not be researched to determine the purpose of the current filing.

(5) The department does not review or proofread every filing.

(a) Filings may be reviewed:

(i) when submitted;

(ii) as a result of a complaint;

(iii) during a regulatory examination or investigation; or

(iv) at any other time the department deems necessary.

(b) If a filing is reviewed and is found to be not in compliance with Utah laws and rules, an ORDER TO PROHIBIT USE will be issued to the filer. The commissioner may require the filer to disclose deficiencies in forms or rating practices to affected policyholders.

(6) Filing correction: [(a) ]No filing transmittal is required when making corrections to misspelled words and punctuation in a filing. The filing will be considered an informational filing.[clerical or typographical corrections are made to a filing previously filed if the corrected filing is submitted within 30 days of the date "filed" with the department]. The filer will need to reference the original filing.[

(b) A new filing is required if the clerical or typographical corrections are made more than 30 days after the filed date of the original filing. The filer will need to reference the original filing.]

(7) Revised forms. A form that is revised from a previously filed form is considered a new form and must be filed for use. The filer will need to reference the original filing and explain the changes to the form.[(7) Filing withdrawal. A filer must notify the department when the filer withdraws a previously filed form, rate, or supplementary information.]

 

R590-226-6. Filing Submission Requirements.

Filings must be submitted by market type and type of insurance. A filing may not include more than one type of insurance, or request filing for more than one insurer. A complete filing consists of the following documents submitted in the following order:

(1) Transmittal. Note: Based on the use of the NAIC Transmittal Form, a cover letter is not required. The "NAIC Life, Accident and Health, Annuity, Credit Transmittal Document" must be used. It can be found at www.insurance.utah.gov/LH_Trans.pdf.

(a) COMPLETE THE TRANSMITTAL BY USING THE FOLLOWING:

(i) "NAIC Coding Matrix"

www.insurance.utah.gov/LifeA&H_Matrix.pdf,

(ii) "NAIC" Instruction Sheet"

www.insurance.utah.gov/LH_Trans_Inst.pdf,

(iii) "Life Content Standards"

www.insurance.utah.gov/Life_STM.html.

(iv) Do not submit the documents described in section (a)(i), (ii), and (iii) with a filing.

(b) Filing Description. The following information must be included in the Filing Description on the transmittal and must be presented in the order shown below:

(i) Domicile Approval. Foreign insurers and filers must first submit filings to their domicile state.

(A) If a filing was submitted to the domicile state, provide a stamped copy of the approval letter from the domicile state for the filing

(B) If a filing was not submitted to the domicile state, or the domicile state did not provide specific approval for the filing, then alternate information must be provided.

(ii) Marketing Facts.

(A) List the issue ages.

(B) List the minimum death benefit.

(C) Identify and describe the type of group.

(D) Identify the intended market for the filing, such as senior citizens, nonprofit organization, association members, corporate owned, bank owned, etc.

(E) Describe the marketing and advertising in detail, i.e. through a marketing association, mass solicitation, electronic media, financial institutions, Internet, telemarketing, or individually through licensed producers.

(iii) Description of Filing.

(A) Provide a detailed description of the purpose of the filing.

(B) Describe the benefits and features of each form in the filing including specific features and options, including nonforfeiture options.

(C) Identify any new, unusual or controversial provisions.

(D) Identify any unresolved previously prohibited provisions and explain why the provisions are included in the filing.

(E) Explain any changes in benefits, charges, terms, premiums, or other provisions that may occur while the policy is in force.

(F) If the filing is replacing or modifying a previous submission, provide information that identifies the filing being replaced or modified, the Utah filed date, and a detailed description of the changes and highlight the changed provisions.

(G) If the filing includes forms for informational purposes, provide the dates the forms were filed.

If filing an application, rider or endorsement, and the filing does not contain a policy, identify the affected policy form number, the Utah filed date, and describe the effect of the submitted forms on the base policy.

(iv) Underwriting Methods. Provide a general explanation of the underwriting applicable to this filing.

(2) Certification. In addition to completing the certification on the NAIC transmittal, the filer must complete and submit the "Utah Life Insurance Filing Certification for Individual" or the "Utah Life Insurance Filing Certification for Group." A filing will be rejected if the certification is missing or incomplete. A certification that is inaccurate may subject the filer to administrative action.

(3) Group Questionnaire or Discretionary Group Authorization Letter. All group filings must identify each type of group, and include either, a completed "Utah Life[,] and Annuity[, Credit Life and Credit Accident and Health Insurance] Group Questionnaire," or a copy of the "Utah Life[,] and Annuity[, Credit Life and Credit Accident and Health] Discretionary Group Authorization Letter."

(4) Letter of Authorization. When the filer is not the insurer, a letter of authorization from the insurer must be included. The insurer remains responsible for the filing being in compliance with Utah laws and rules.

(5) Statement of Variability. Any item or provision on the data page or within the form that is variable must be contained within the brackets. List the ranges of variable items or factors within the brackets. Each variable item must be identified and explained in a statement of variability. If the information contained within the brackets changes, the form must be refiled.

(6) Items being submitted for filing. Refer to each applicable subsection of this rule for general procedures and additional procedures on how to submit forms and reports.

(7) Life Insurance Illustration Materials. If the life insurance form is identified as illustrated, the filing must include a sample:

(a) basic illustration completed with data in John Doe fashion;

(b) current illustration actuary's certification;

(c) company officer certification; and

(d) sample annual report.

(8) Statement of Policy Cost and Benefit Information. If the life insurance form is not illustrated, the filing must include a sample of the Statement of Policy Cost and Benefit Information.

(9) Actuarial Memorandum, Demonstration, and Certification of Compliance. An actuarial memorandum, demonstration of compliance, and a certification of compliance are required in individual and group life insurance filings. The memorandum must be currently dated and signed by the actuary. The memorandum must include:

(a) description of the coverage in detail;

(b) demonstration of compliance with applicable nonforfeiture and valuation laws; and

(c) a certification of compliance with Utah law.

(10) Return Notification Materials.

(a) Return notification materials are limited to:

(i) a copy of the transmittal; and

(ii) a self-addressed, stamped envelope.

(b) Notice of filing will not be provided unless return notification materials are submitted.

 

R590-226-7. Procedures for Filings.

(1) Forms in General.

(a) Forms are "File and Use" filings.

(b) Each form must:

(i) be identified by a unique form number; and

(ii) contain a descriptive title on the cover page.

(c) The form number and the policy cover page descriptive title may not be variable.

([c]d) Forms must be in final printed form or printer's proof format. Drafts may not be submitted.

([d]e) The form must be completed in John Doe fashion to accurately represent the intended market, purpose, and use.

(i) If the market intended is for the senior age group, the form must be completed with data representative of senior insureds.

(ii) All John Doe data in the forms including the [specification page]data page must be accurate and consistent with the actuarial memorandum, the basic illustration, the Statement of Policy Cost and Benefit information, and the application, as applicable.

(iii) When submitting a rider or endorsement, include a sample policy data page that includes the rider or endorsement information.

(iv) Forms may include variable data within brackets. All variable data must be identified within the specific section, or a statement of variability included with the submission.

(2) Policy Filings.

(a) Each type of insurance must be filed separately. A policy filing consists of one policy form for a single type of insurance including its related forms, such as the application, sample data page, rider, endorsement, and actuarial memorandum.

(b) A policy data page must be included with every policy filing.

(c) Only one policy form for a single type of insurance may be filed, in each filing a life insurance policy with different premium payment periods is considered one form.

(d) A policy data page that changes the basic feature of the policy may not be filed without including the entire policy form in the filing. A filing consisting of only a data page without the policy form will be rejected as incomplete.

(3) Rider or Endorsement Filing.

(a) Related riders or endorsements may be filed as a single filing.

(b) A rider or endorsement that is based on morbidity risks, such as critical illness or long-term care, is considered accident and health insurance and must be filed in accordance with Rule R590-220, "Accident and Health Insurance Filings."

(c) A single rider or endorsement that affects multiple policy forms may be filed separately if the Filing Description references all affected forms.

(d) The filing must include:

(i) a listing of all base policy form numbers, title and dates filed with the Utah Insurance Department;

(ii) a description of how each filed rider or endorsement affects the base policy; and

(iii) a sample data page with data for the submitted form.

(4) Application Filings. Each application or enrollment form may be submitted as a separate filing or may be filed with its related policy or certificate filing. If an application has been previously filed or is filed separately, an informational copy of the application must be included with the policy or certificate filing.

 

R590-226-8. Additional Procedures for Individual Life Insurance Forms and Group Life Insurance Certificates Marketed Individually.

(1) Insurers filing life insurance forms are advised to review the following code sections and rules prior to submitting a filing:

(a) Section 31A-21 Part III, "Specific Clauses in Contracts;"

(b) Section 31A-22 Part IV, "Life Insurance and Annuities;"

(c) R590-79, "Life Insurance Disclosure Rule[for Policy Summary];"

(d) R590-93, "Replacement of Life Insurance and Annuities;"

(e) R590-94, "Smoker/Nonsmoker Mortality Tables";

(f) R590-95, "Minimum Nonforfeiture Standards 1980 CSO and 1980 CET Mortality Tables;"

(g) R590-98, "Unfair Practice in Payment of Life Insurance and Annuity Policy Values;"

(h) R590-108, "Interest Rate During Grace Period or Upon Reinstatement of Policy;"

(i) R590-122, "Permissible Arbitration Provisions;"[

(j) R590-145, "Accelerated Benefits;"]

(j[k]) R590-177, "Life Insurance Illustrations;"

(k[l]) R590-191, "Unfair Life Insurance Claims Settlement Practice;"

(l[m]) R590-198, "Valuation of Life Insurance Policies;" and

(m[n]) R590-223, "Rule to Recognize 2001 CSO Mortality Table."

(2) Every individual life insurance policy, rider or endorsement providing benefits, and every group life insurance filing including certificates that are marketed individually, shall include an actuarial memorandum, a demonstration, and a certification of compliance for nonforfeiture and valuation. Refer to the following:

(a) Section 31A-22-408, "Standard Nonforfeiture Law for Life Insurance;"

(b) Section 31A-17 Part V, "Standard Valuation Law."[

(3) When submitting accelerated benefits riders or provisions, the filing must include an actuarial memorandum for the accelerated benefit, a solicitation disclosure form, and a benefit payment disclosure form.]

 

R590-226-9. Additional Procedures for Group Market Filings.

(1) Insurers submitting group life insurance filings are advised to review the following code sections and rules prior to submitting a filing:

(a) Section 31A-21 Part III, "Specific Clauses in Contracts;"

(b) Section 31A-22 Part IV, "Life Insurance and Annuities;"

(c) Section 31A-22 Part V, "Group Life Insurance;"

(d) R590-79, "Life Insurance Disclosure Rule;"[

(e) R590-145, "Accelerated Benefits;"]

(e[f]) R590-191, "Unfair Life Insurance Claims Settlement Practice."

(2) A policy must be included with each certificate filing along with a master application and enrollment form.

(3) Statement of Policy Cost and Benefit Information. A statement of policy cost and benefit information must be included in non-term group life insurance and preneed funeral policies or prearrangements. This disclosure requirement shall extend to the issuance or delivery of certificates as well as to the master policy in compliance with R590-79-3.

(4) Actuarial Memorandum. An actuarial memorandum must be included in all group life insurance filings describing the coverage in detail and certifying compliance with applicable laws and rules. For non-term group life filings, the memorandum must also demonstrate nonforfeiture compliance with Section 31A-22-515.

(5) Eligible Group. A filing for an eligible group must include a completed "Utah Life[,] and Annuity[, Credit Life, and Credit Accident and Health] Group Questionnaire."

(a) A questionnaire must be completed for each eligible group under Section 31A-22-502 through 508.

(b) When a filing applies to multiple employer-employee groups under Section 31A-22-502, only one questionnaire is required to be completed.

(6) Discretionary Group. If a group is not an eligible group, then specific discretionary group authorization must be obtained prior to submitting the filing. If a form filing is submitted without discretionary group authorization, the filing will be rejected.

(a) To obtain discretionary group authorization a "Utah Life[,] and Annuity[, Credit Life, and Credit Accident and Health] Request For Discretionary Group Authorization" must be submitted and include all required information.

(b) Evidence or proof of the following items are some factors considered in determining acceptability of a discretionary group:

(i) existence of a verifiable group;

(ii) that granting permission is not contrary to public policy;

(iii) the proposed group would be actuarially sound;

(iv) the group would result in economies of acquisition and administration which justify a group rate; and

(v) the group would not present hazards of adverse selection.

(c) Discretionary group filings that do not provide authorization documentation will be rejected.

(d) Any changes to an authorized discretionary group must be submitted to the department, such as; change of name, trustee, domicile state, within 30 days of the change.

(e) The commissioner may periodically re-evaluate the group's authorization.

 

R590-226-16. Enforcement Date.

The commissioner will begin enforcing the provisions of this rule [May]June 1, 200[4]6.

 

KEY: life insurance filings

Date of Enactment or Last Substantive Amendment: [April 28, 2005]2006

Authorizing, and Implemented or Interpreted Law: 31A-2-201; 31A-2-201.1; 31A-2-202