No. 27345 (Amendment): R590-102. Insurance Department Fee Payment Rule

DAR File No.: 27345
Filed: 08/11/2004, 04:58
Received by: NL

 

RULE ANALYSIS

Purpose of the rule or reason for the change:

This amendment is being proposed to adopt changes in the department's fees made by the Appropriations bill, S.B. 1 that was passed in 2004 legislative session. (DAR NOTE: S.B. 1 is found at UT L 2004 Ch 256, and was effective 07/01/2004.)

 

Summary of the rule or change:

Section R590-102-4 has nonsubstantive changes in terminology. Subsection R590-102-5(3)(b) deletes the workers' compensation loss cost schedule from inclusion in the annual service fee. Changes to Section R590-102-7 are for clarification purposes only and are nonsubstantive. The change in Section R590-102-9 increases the length of time a license is considered lapsed from 31 through 365 days to 730 days. The change in Section R590-102-10 has moved the title fee for rates, forms, and reports to Section R590-102-15. The change in Section R590-102-11 replaces the term "approval fee" with "license fee."Section R590-102-12 now includes an additional nonelectronic processing fee of $25 for paper applications. The change in Section R590-102-13 eliminates the $27 fee for the insurance codebook which the department no longer publishes and sells. Section R590-102-14 changes the captive insurer fee from $75 to $1,000 annually. The nonelectronic fee has been moved to Section R590-102-12. The change in Section R590-102-15 moved the title agency filing fee to Section R590-102-10 and has added a new fee of $35 assessed to licensees that do not report changes of address to the department.

 

State statutory or constitutional authorization for this rule:

Section 31A-3-103

 

Anticipated cost or savings to:

the state budget:

The changes to the department's fee rule, as noted in The Summary of the Rule Change above, and as follows, will create an increased revenue of $38,348 to the General Fund. This is the result of the following projections for the coming year: 2 captive insurers requesting a new or renewal license for an additional cost of $925 for 1 license and $1,850 for 2; an increase in the paper application fee of $20 x 300 applications per year = $6,000; the workers' compensation fee of $5 x 50 per year = $250; the fee of $35 for 1,000 address corrections a year = $35,000; and the deletion of the codebook fee of $27 plus mailing costs = loss of $4,752 to the General Fund. The department will not need to hire or let any employees go as a result of these changes.

 

local governments:

This will have no effect on the local government since the fees in this rule are related to business dealings with the Insurance Department only.

 

other persons:

Captive insurers wanting to do business in Utah will be required to pay a new or renewal e-commerce fee of $1,000 annually. This is an increase of $925 over the current $75 annual fee. Anyone requesting a workers' compensation loss cost report will need to pay $5. Currently, service is included in the insurer's annual service fee. Currently, there is no fee for an address change. This change will require the licensee to pay $35 to have his address changed. It is estimated that 1,000 requests for address change will be received by the department creating revenue of $35,000.

 

Compliance costs for affected persons:

Captive insurers wanting to do business in Utah will be required to pay a new or renewal e-commerce fee of $1,000 annually. This is an increase of $925 over the current $75 annual fee. Anyone requesting a workers' compensation loss cost report will need to pay $5. Currently service is included in the insurer's annual service fee. Currently there is no fee for an address change. This change will require the licensee to pay $35 to have his address changed. It is estimated that 1,000 requests for address change will be received by the department creating revenue of $35,000.

 

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

The effects of these changes on Utah business will be minimal for the most part. For approximately 1,000 insurance agents who forget to give the insurance department their change of address information, they will be required to pay a $35 fine and the 1 - 3 captive insurers who want to renew their Certificate of Authority will be required to pay an additional $925.

 

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:

10/01/2004

 

This rule may become effective on:

10/02/2004

 

Authorized by:

Jilene Whitby, Information Specialist

 

 

RULE TEXT

R590. Insurance, Administration.

R590-102. Insurance Department Fee Payment Rule.

R590-102-4. General Instructions.

(1) Any fee payable to the department not included in Subsections R590-102-5 through 14, shall be due when service is requested, if applicable, otherwise by the due date on the invoice. A non-electronic payment fee will be added to the fee due the department when a payment that can be made electronically is done through a non-electronic method.

(2) Payment.

(a) Checks shall be made payable to the Utah Insurance Department. A check that is dishonored in the process of the collection will not constitute payment of the fee for which it was issued and any action taken [pursuant to the fee]based on the payment will be [negated]voided. [Any late]Late fees [or]and other penalties, resulting from the voided action will apply until proper payment is made. [Tender of a check to the department, that is subsequently dishonored,]A check payment that is dishonored is a violation of this rule.

(b) Cash payments. The department is not responsible for un-receipted cash that is lost or misdelivered.

(c) Electronic payments.

(i) Credit Card. Credit cards may be used to pay any fee due to the department. Credit card payments that are dishonored will not constitute payment of the fee and any action taken based on the payment will be voided. Late fees and other penalties, resulting from the voided action, will apply until proper payment is made. A credit card payment that is dishonored is a violation of this rule.

(ii) Automated clearinghouse (ACH). Payers or purchasers desiring to use this method must contact the department for the proper routing and transit information. Payments that are made in error to another agency or that are not deposited into the department's account will not constitute payment of the fee and any action taken based on the payment will be voided. Late fees and other penalties resulting from the voided action will apply until proper payment is made. An ACH payment that is dishonored is a violation of this rule.

(3) Retaliation. The fees enumerated in this rule are not subject to retaliation in accordance with Section 31A-3-401 if other states or countries impose higher fees.

(4) Refunds.

(a) All fees in this rule are non-refundable.

(b) Overpayments of fees are refundable.

(c) Requests for return of overpayments must be in writing.

(5) Implementation date.

(a) All fees, except resident and non-resident individual and agency license renewal fees, are implemented November 1, 2003.

(b) Resident and non-resident individual and agency license renewal fees are implemented December 1, 2003.

(6) A non-electronic processing fee will be assessed for a particular service if the department has established an electronic process for that service. See Section 12 for non-electronic processing fees.

 

R590-102-5. Admitted Insurer Annual License and Annual Service Fees.

(1) Annual license fees.

(a) certificate of authority, initial license application - due with license application: $1,002;

(b) certificate of authority - renewal - due by the due date on the invoice: $302;

(c) certificate of authority - reinstatement - due with application for reinstatement: $1,002;

(d) certificate of authority - amendments - due with request for amendment: $252;

(e) application for merger, acquisition, or change of control - Form A, due with filing: $2,002. Expenses incurred for consultant(s) services necessary to evaluate the Form A will be charged to the applicant and due when billed;

(f) redomestication filing - due with filing: $2,002; and

(g) application for organizational permit for mutual insurer to solicit applications for qualifying insurance policies or subscriptions for mutual bonds or contribution notes - due with application: $1,002.

(2) The annual initial or annual renewal license fee includes the following licensing services for which no additional fee is required:

(a) filing annual statement and report of Utah business - due annually on March 1;

(b) filing holding company registration statement - Form B;

(c) filing application for material transactions between affiliated companies - Form D;

(d) application for: stock solicitation permit, public offering filing, but not an SEC filing; an SEC filing; private placement offering; and

(e) application for individual license to solicit in accordance with the stock solicitation permit.

(3) Annual service fee:

(a) Due annually by the due date on the invoice. The fee is based on the Utah premium as shown in the latest annual statement on file with the National Association of Insurance Commissioners (NAIC) and the department. Fee calculation example: the 200[3]4 annual service fee calculation will use the Utah premium shown in the December 31, 200[2]3 annual statement.

(i) $0 premium volume: no service fee;

(ii) more than $zero but less than $1 million in premium volume: $700;

(iii) $1 million but less than $3 million in premium volume: $1,100;

(iv) $3 million but less than $6 million in premium volume: $1,550;

(v) $6 million but less than $11 million in premium volume: $2,100;

(vi) $11 million but less than $15 million in premium volume: $2,750;

(vii) $15 million but less than $20 million in premium volume: $3,500; and

(viii) $20 million or more in premium volume: $4,350.

(b) The annual service fee includes the following services for which no additional fee is required:

(i) filing of amendments to articles of incorporation, charter, or bylaws;

(ii) filing of power of attorney;

(iii) filing of registered agent;

(iv) affixing commissioner's seal and certifying any paper;

(v) filing of authorization to appoint and remove agents;

(vi) filing of producer/agency appointment with an insurer - initial;

(vii) filing of producer/agency appointment with an insurer - termination;

(viii) filing of producer/agency appointment with an insurer - biennial renewal;

(ix) report filing, all lines of insurance;

(x) rate filing, all lines of insurance; and

(xi) form filing, all lines of insurance[; and

(xii) workers' compensation loss cost schedule].

(c) The annual service fee is for services that the department will provide for an admitted insurer during the year. The fee is paid in advance of providing the services.

 

R590-102-7. Captive Insurer Fees.

(1) Initial license application - due with license application: $202.

(2) Initial license application review - due by the due date on the invoice: actual costs incurred by the department to review the application.

(3) Annual license fees:

(a) initial - due by the due date on the invoice: $302;

(b) renewal - due by the due date on the invoice: $302; and

(c) reinstatement - due with application for reinstatement: $302.

(4) Annual service fee - due by the due date on the invoice: $200.

 

R590-102-9. Individual Resident and Non-Resident Biennial License Fees.

(1) Resident and non-resident full-line individual initial license or renewal fee for two-year period:

(a) initial license fee - due with application: $72:

(b) express initial license fee - due with application: $72;

(c) renewal license fee if renewed prior to renewal deadline - due with renewal application: $72;

(d) renewal license fee if renewed 1 through 30 days after renewal deadline and prior to license lapse - due with renewal application: $142; and

(e) lapsed license reinstatement fee if reinstated 31 days through [365]730 days after renewal deadline - due with application for reinstatement: $192.

(2) Resident and non-resident limited-line individual initial or renewal license fee, for two-year period:

(a) initial license fee - due with application: $47;

(b) renewal license fee if renewed prior to renewal deadline - due with renewal application: $47;

(c) renewal license fee if renewed 1 through 30 days after renewal deadline and prior to license lapse - due with renewal application: $92; and

(d) lapsed license reinstatement fee if reinstated 31 days through [365]730 days after renewal deadline - due with application for reinstatement: $142.

(3) Fee for addition of producer classification or line of authority to individual producer license - due with request for additional classification or line of authority: $27.

(4) The initial and renewal full-line producer and limited-line producer fee includes the following services for which no additional fee is required:

(a) issuance of letter of certification;

(b) issuance of letter of clearance;

(c) issuance of duplicate license;

(d) individual continuing education services; and

(e) other services provided to the licensee.

(5) The initial and renewal individual license fee includes services the department will provide during the year. The fee is paid in advance of providing the services.

 

R590-102-10. Biennial Agency License Fees.

(1) Resident and non-resident agency initial or renewal license per two-year license period for a full-line agency and for a limited-line agency:

(a) initial license fee - due with application: $77;

(b) renewal license fee if renewed prior to renewal deadline - due with renewal application: $77;

(c) renewal license fee if renewed 1 through 30 days after renewal deadline and prior to license lapse - due with renewal application: $152; and

(d) lapsed license reinstatement fee if reinstated 31 days through 730 days after renewal deadline - due with application for reinstatement: $202.

(2) Fee for addition of producer classification or line of authority to agency license - due with request for additional classification or line of authority: $27.

(3) Bail bond agency per annual license period:

(a) initial license fee - due with application: $252;

(b) renewal license fee if renewed prior to renewal deadline - due with renewal application: $252;

(c) renewal license fee if renewed 1 through 30 days after renewal deadline and prior to license lapse - due with renewal application: $502; and

(d) lapsed license reinstatement fee if reinstated 31 days after renewal deadline - due with application for reinstatement: $602.

(4) Health insurance purchasing alliance annual license:

(a) initial license fee - due with application: $502;

(b) renewal license fee if renewed prior to renewal deadline - due with renewal application: $502;

(c) renewal license fee if renewed 1 through 30 days after renewal deadline and prior to license lapse - due with renewal application: $752; and

(d) lapsed license reinstatement fee if reinstated 31 days after renewal deadline - due with application for reinstatement: $802.

(5) The initial and renewal agency license fee includes the following services for which no additional fee is required:

(a) issuance of letter of certification;

(b) issuance of letter of clearance;

(c) issuance of duplicate license;

(d) filing of producer designation to agency license - initial;

(e) filing of producer designation to agency license - termination;

(f) filing of producer designation to agency license - biennial renewal;

(g) filing of amendment to agency license;

(h) filing of power of attorney; and

(i) any other services provided to the licensee.

(6) The initial and renewal agency license fee includes services the department will provide during the year. The fee is paid in advance of providing the services.

(7) Title agency filing (rate, form, or report) - due with filing: $25.

 

R590-102-11. Continuing Education Fees.

(1) Continuing education provider [approval]license fees:

(a) initial [approval]license fee - due with application: $252;

(b) renewal [approval]license fee if renewed prior to renewal deadline - due with renewal application: $252;

(c) renewal [approval]license fee if renewed 1 through 60-days after renewal deadline and prior to [approval]license lapse - due with renewal application: $302; and

(d) Lapsed [approval]license reinstatement fee if reinstated 61 days after renewal deadline - due with application for reinstatement: $352.

(2) Continuing education course post-approval fee - due with request for approval: $5 per credit hour, minimum fee $27.

 

R590-102-12. Non-electronic Processing Fees.

[Non-electronic producer and agency appointment filing - initial or termination - due with each paper filing: $5.](1) Paper filing processing fee - assessed on a non-electronic filing when the department has mandated the use of an electronic filing process - due with each paper filing or by the due date on the invoice: $5.

(2) Paper application processing fee - assessed on a non-electronic application when the department has mandated the use of an electronic application process - due with each paper application or by the due date on the invoice: $25.

 

R590-102-13. Dedicated Fees.

The following are fees dedicated to specific uses:

(1) annual fraud assessment fee - due by the due date on the invoice;

(2) annual title assessment fee - due by the due date on the invoice;

(3) relative value study book fee - due when book purchased or by invoice due date: 12;[

(4) Utah insurance codebook fee - due when book purchased or by invoice due date: $27;] and

([5]4) mailing fee for books - due if book is to be mailed to purchaser: $3.

 

R590-102-14. Electronic Commerce Dedicated Fees.

(1) E-commerce and internet technology services fee:

(a) admitted insurer[, captive insurer,] and surplus lines insurer - due with the annual initial, annual renewal, or reinstatement application: $75;

(b) captive insurer - due with the annual initial, annual renewal, or reinstatement application: $1,000;

(c) other organization and viatical settlement provider - due with the annual initial, annual renewal, or reinstatement application: $50;

([c]d) continuing education provider - due with the annual initial, annual renewal, or reinstatement application: $20;

([d]e) agency - due with the biennial initial, biennial renewal, or reinstatement application: $10; and

([e]f) individual - due with the biennial initial, biennial renewal, or reinstatement application: $5.

(2) The e-commerce and internet technology services fees are authorized until July 1, 2006.

(3) Database access fee - due when the department's database is accessed to input or acquire data: $3 per transaction.[

(4) Non-electronic payment fee - added to fees due the department when a payment that can be made electronically is done through some other method: $5 per payment.]

 

R590-102-15. Other Fees.

(1) photocopy fee - per page: $.50.

(2) Complete annual statement copy fee - per statement: $42.

(3) Fee for accepting service of legal process: $12.

(4) Fees for production of information lists regarding admitted insurers, other organizations, individuals, agencies, or other information that can be produced by list:

(a) printed list: $1 per page;

(b) electronic list:

(i) 1 to 500 records: $52; and

(ii) 501 or more records: $.11 per record.

(5) Returned check fee: $20.

(6) Workers compensation loss cost multiplier schedule: $5.

(7) [Title agency filing (rate, form, or report) - due with filing: $25]Address correction fee -- assessed when department has to research and enter new address for a licensee -- due by the due date on the invoice: $35.

 

KEY: insurance

[January 8,] 2004

Notice of Continuation February 21, 2002

31A-3-103