No. 30851: R590-155. Disclosure of Life and Health Guaranty Association Limitations

DAR File No.: 30851
Filed: 12/17/2007, 04:24
Received by: NL

NOTICE OF REVIEW AND STATEMENT OF CONTINUATION

Concise explanation of the particular statutory provisions under which the rule is enacted and how these provisions authorize or require the rule:

Subsection 31A-2-201(3)(a) authorizes the commissioner to make rules to implement the provisions of the Insurance Code. Subsection 31A-28-119(4) requires insurers to send their insureds a disclosure notice stating that their policy is not covered under the Life and Health Guaranty Association if they, the insurer, become insolvent.

Summary of written comments received during and since the last five-year review of the rule from interested persons supporting or opposing the rule:

The department has received no written comments regarding this rule in the past five years.

Reasoned justification for continuation of the rule, including reasons why the agency disagrees with comments in opposition to the rule, if any:

Section 31A-28-119 was written to prohibit agents from telling prospective insureds that the policy they are buying is covered by the Guaranty Association in event the insurance company becomes insolvent. This argument has been used deceptively to sell policies where the insurer was financially unsound.

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]

Authorized by:

Jilene Whitby, Information Specialist