No. 35556 (5-year Review): Rule R590-126. Accident and Health Insurance Standards

DAR File No.: 35556
Filed: 12/19/2011 04:11:32 PM

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 rules to implement the Insurance Code; Sections 31A-2-202 and 31A-23a-412 authorize the commissioner to request reports, conduct examinations, and inspect records of any licensee; Subsection 31A-22-605(4) requires the commissioner to adopt rules to establish standards for disclosure in the sale of, and benefits to be provided by individual and franchise accident and health polices; Section 31A-22-623 authorizes the commissioner to establish by rule minimum standards of coverage for dietary products for inborn metabolic errors; Section 31A-22-626 authorizes the commissioner to establish by rule minimum standards of coverage for diabetes for accident and health insurance; Subsection 31A-23a-402(8) authorizes the commissioner to define by rule acts and practices that are unfair and unreasonable; and Subsection 31A-26-301(1) authorizes the commissioner to set standards for timely payment of claims. The rule provides reasonable standardization and simplification of terms and coverages of insurance policies in order to facilitate public understanding and comparison and to prohibit provisions which may be misleading or confusing in connection with the purchase of accident and health insurance or with the settlement of claims and to provide full disclosure in the sale of such insurance.

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

No written comments have been received by the department during the past five years, even during the three comment periods provided to the public when changes were made to the rule.

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

Products in the individual market require closer regulation since there is not an employer entity who can bargain for an equitable contract on behalf of the individual. The rule sets forth benefits to be offered for certain products, yet still allows products with lesser benefits to be offered if marketed as "limited benefits." This assists individuals to asses what type of product is being offered. Therefore, this rule should be continued.

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

Effective:

12/19/2011

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