No. 43486 (Amendment): Rule R590-155. Utah Life and Health Insurance Guaranty Association Summary Document

(Amendment)

DAR File No.: 43486
Filed: 01/18/2019 01:18:32 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

These changes are being made to update the location of the a disclaimer, clarify the term "policy or contract holders", make some formatting changes, and update a clause.

Summary of the rule or change:

The Utah Life and Health Insurance Guaranty Association (ULHIGA) Disclaimer is available at the Insurance Department (Department) and on its website, and this rule is being updated to reflect this availability. The definition of the term "policy or contract holders" is being clarified to include "subscribers". Several formatting and clerical changes are being made, and the rule's severability clause is being updated. These changes to this rule are necessary due to H.B. 409, Utah Life and Health Insurance Guaranty Association Amendments, which was passed during the 2018 General Session.

Statutory or constitutional authorization for this rule:

• Subsection 31A-28-119(3)
• Subsection 31A-2-201(3)(a)

Anticipated cost or savings to:

the state budget:

There is no anticipated cost or savings to the state budget. None of these rule changes include any financial component whatsoever. The ULHIGA Disclaimer is already hosted on the Department's website, so there will be no change to the Department's technology costs, and the other changes are largely clerical.

local governments:

There is no anticipated cost or savings to local governments. This rule governs the relationship between insurers and their insureds, and does not involve local governments.

small businesses:

There is no anticipated cost or savings to small businesses. This rule governs the relationship between insurers and their insureds, and has no required action on the part of small businesses.

persons other than small businesses, businesses, or local governmental entities:

There is no anticipated cost or savings to any other persons. Insurers that are required to send out the ULHIGA Disclaimer already do so, and the other changes are largely clerical.

Compliance costs for affected persons:

There are no compliance costs for any affected persons. Insurers that are required to send out the ULHIGA Disclaimer already do so, and the other changes are largely clerical.

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

After conducting a thorough analysis, it was determined that these proposed rule changes will not result in fiscal impact to businesses.

Todd E. Kiser, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Office 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:

• Steve Gooch 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:

03/18/2019

This rule may become effective on:

03/25/2019

Authorized by:

Steve Gooch, Information Specialist

RULE TEXT

Appendix 1: Regulatory Impact Summary Table*

Fiscal Costs

FY 2019

FY 2020

FY 2021

State Government

$0

$0

$0

Local Government

$0

$0

$0

Small Businesses

$0

$0

$0

Non-Small Businesses

$0

$0

$0

Other Person

$0

$0

$0

Total Fiscal Costs:

$0

$0

$0

Fiscal Benefits

State Government

$0

$0

$0

Local Government

$0

$0

$0

Small Businesses

$0

$0

$0

Non-Small Businesses

$0

$0

$0

Other Persons

$0

$0

$0

Total Fiscal Benefits:

$0

$0

$0

Net Fiscal Benefits:

$0

$0

$0

 

*This table only includes fiscal impacts that could be measured. If there are inestimable fiscal impacts, they will not be included in this table. Inestimable impacts for State Government, Local Government, Small Businesses and Other Persons are described in the narrative. Inestimable impacts for Non - Small Businesses are described in Appendix 2.

 

Appendix 2: Regulatory Impact to Non - Small Businesses

These rule changes are not expected to have any fiscal impact on non-small businesses revenues or expenditures, because non-small businesses that are required to send out the Utah Life and Health Insurance Guaranty Association Disclaimer to their policy and contract holders already do so. There is no additional action required by this rule.

 

The head of the Insurance Department, Commissioner Todd E. Kiser, has reviewed and approved this fiscal analysis.

 

 

R590. Insurance, Administration.

R590-155. Utah Life and Health Insurance Guaranty Association Summary Document.

R590-155-1. Authority.

This rule is promulgated pursuant to:

(1) Subsection 31A-2-201(3)(a), in which the commissioner is empowered to administer and enforce this title and to make rules to implement the provisions of this title; and

(2) Subsection 31A-28-119(3), to provide guidelines for the Utah Life and Health Insurance Guaranty Association summary and disclaimer document.

 

R590-155-2. Purpose and Scope.

[1.](1) The purpose of this rule is to specify the form and content of the summary and disclaimer document for insurers to disclose to policy or contract holders the extent that contractual guarantees are not covered or have limited coverage by the Utah Life and Health Insurance Guaranty Association as required by Section 31A-28-119.

[2.](2) The rule shall apply to all insurance transactions in this state involving life and health insurance policies and annuity contracts as specified in [Subsection]Section 31A-28-103[(2)].

 

R590-155-3. Rule.

[1.](1) An insurer authorized to do business in this state, which is subject to the Utah Life and Health Insurance Guaranty Association Act, shall disclose to its policy or contract holders that its contractual guarantees may not be covered by the Utah Life and Health Insurance Guaranty Association.

[2.](2) For the purpose of this rule, the term "policy or contract holders" shall also mean insureds, subscribers, or certificate holders of group policies.

[3.](3) Disclosure shall be made in writing using the text in the [attachment to this Rule]Utah Life and Health Insurance Guaranty Association Disclaimer, which is available on the department website, https://insurance.utah.gov.

[4.](4) Disclosure shall be given before or at the time of delivery of the policy, contract, or certificate. The summary and disclaimer document shall also be available upon request by a policy or contract holder.

[5.](5) Each insurer shall [submit]file with the commissioner a copy of the summary and disclaimer document[to the commissioner for approval].

 

R590-155-4. [Enforcement Date.

The commissioner will begin enforcing this rule 45 days from the effective date of this rule.

 

R590-155-5. ]Penalties.

A person found to be in violation of this rule shall be subject to penalties as provided under Section 31A-2-308.

 

R590-155-[6]5. Severability.

If any provision [or clause ]of this rule or [the ]its application [of it ]to any person or situation is [for any reason ]held to be invalid, that invalidity shall not affect any other provision or application of this rule which can be given effect without the invalid provision or application, and to this end the provisions of this rule are declared to be severable[the remainder of the rule and the application of any provisions to other persons or circumstances shall not be affected].

 

KEY: insurance

Date of Enactment or Last Substantive Amendment: [June 21, 2010]2019

Notice of Continuation: December 8, 2017

Authorizing, and Implemented or Interpreted Law: 31A-2-201; 31A-28-119

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