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H0025........................................................by MR. SPEAKER
Requested by: Department of Insurance
INSURERS - Amends existing law to revise insurer examination expenses; to
provide that the director may use a portion of the annual continuation fee
to fund the Arson, Fire and Fraud Account; to provide that property and
casualty rating organization and worker's compensation rating
organizations licenses shall be effective for one year; to provide that
corporations shall file approved articles of incorporation with the
Secretary of State; to delete reference to refunds of unearned filing fees
and application fees; to revise hospital trust, managed care organization,
self-funded plan, Petroleum Clean Water Trust Fund and State Insurance Fund
examination expenses.
01/08 House intro - 1st rdg - to printing
Rpt prt - to Bus
02/22 Rpt out - rec d/p - to 2nd rdg
02/23 2nd rdg - to 3rd rdg
03/01 3rd rdg - PASSED - 59-1-10
AYES -- Barraclough, Bell, Black, Boe, Bolz, Bradford, Bruneel,
Callister, Campbell, Chase, Clark, Collins, Crow, Cuddy, Deal,
Denney, Ellis, Ellsworth, Eskridge, Field(13), Field(20), Gagner,
Hadley, Harwood, Henbest, Higgins, Hornbeck, Jones, Kellogg, Kendell,
Kunz, Lake, Langford, Loertscher, McKague, Meyer, Montgomery,
Mortensen, Moss, Moyle, Pearce, Pischner, Pomeroy, Raybould,
Ridinger, Roberts, Robison, Sali, Schaefer, Sellman, Shepherd, Smith,
Smylie, Tilman, Trail, Wheeler, Wood, Young, Mr. Speaker
NAYS -- Barrett
Absent and excused -- Bedke, Bieter, Gould, Hammond, Jaquet, Mader,
Marley, Stevenson, Stone, Swan
Floor Sponsor -- Callister
Title apvd - to Senate
03/02 Senate intro - 1st rdg - to Com/HuRes
03/07 Rpt out - rec d/p - to 2nd rdg
03/08 2nd rdg - to 3rd rdg
03/19 3rd rdg - PASSED - 35-0-0
AYES -- Andreason, Branch, Boatright, Brandt, Bunderson, Burtenshaw,
Cameron, Danielson, Darrington, Davis, Deide, Dunklin, Frasure,
Geddes, Goedde, Hawkins, Ingram, Ipsen, Keough, King-Barrutia, Lee,
Lodge, Noh, Richardson, Risch, Sandy, Schroeder, Sims, Sorensen,
Stegner, Stennett, Thorne, Wheeler, Whitworth, Williams,
NAYS -- None
Absent and excused -- None
Floor Sponsors -- Goedde, Stegner
Title apvd - to House
03/20 To enrol
03/21 Rpt enrol - Sp signed
Pres signed
03/22 To Governor
03/22 Governor signed
Session Law Chapter 85
Effective: 07/01/01
|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-sixth Legislature First Regular Session - 2001IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 25 BY MR. SPEAKER Requested by: Department of Insurance 1 AN ACT 2 RELATING TO THE DEPARTMENT OF INSURANCE; AMENDING SECTION 41-228, IDAHO CODE, 3 TO REVISE INSURER EXAMINATION EXPENSES; AMENDING SECTION 41-268, IDAHO 4 CODE, TO PROVIDE THAT THE DIRECTOR MAY USE A PORTION OF THE ANNUAL CONTIN- 5 UATION FEE TO FUND THE ARSON, FIRE AND FRAUD ACCOUNT AND TO MAKE A TECHNI- 6 CAL CORRECTION; AMENDING SECTION 41-319, IDAHO CODE, TO MAKE TECHNICAL 7 CORRECTIONS; AMENDING SECTION 41-1105, IDAHO CODE, TO MAKE TECHNICAL COR- 8 RECTIONS; AMENDING SECTION 41-1416, IDAHO CODE, TO PROVIDE THAT PROPERTY 9 AND CASUALTY RATING ORGANIZATION LICENSES SHALL BE EFFECTIVE FOR ONE YEAR 10 AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 41-1620, IDAHO CODE, 11 TO PROVIDE THAT WORKER'S COMPENSATION RATING ORGANIZATION LICENSES SHALL 12 BE EFFECTIVE FOR ONE YEAR AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SEC- 13 TION 41-2805, IDAHO CODE, TO PROVIDE THAT CORPORATIONS SHALL FILE APPROVED 14 ARTICLES OF INCORPORATION WITH THE SECRETARY OF STATE, TO DELETE REFERENCE 15 TO REFUNDS OF UNEARNED FILING FEES AND TO MAKE TECHNICAL CORRECTIONS; 16 AMENDING SECTION 41-2810, IDAHO CODE, TO DELETE REFERENCE TO REFUNDS OF 17 APPLICATION FEES AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 18 41-3410, IDAHO CODE, TO DELETE REFERENCE TO REFUNDS OF APPLICATION FEES; 19 AMENDING SECTION 41-3716, IDAHO CODE, TO REVISE HOSPITAL TRUST EXAMINATION 20 EXPENSES; AMENDING SECTION 41-3911, IDAHO CODE, TO REVISE MANAGED CARE 21 ORGANIZATION EXAMINATION EXPENSES; AMENDING SECTION 41-4013, IDAHO CODE, 22 TO REVISE SELF-FUNDED PLAN EXAMINATION EXPENSES; AMENDING SECTION 41-4935, 23 IDAHO CODE, TO REVISE PETROLEUM CLEAN WATER TRUST FUND EXAMINATION 24 EXPENSES; AND AMENDING SECTION 72-914, IDAHO CODE, TO REVISE STATE INSUR- 25 ANCE FUND EXAMINATION EXPENSES AND TO MAKE TECHNICAL CORRECTIONS. 26 Be It Enacted by the Legislature of the State of Idaho: 27 SECTION 1. That Section 41-228, Idaho Code, be, and the same is hereby 28 amended to read as follows: 29 41-228. EXAMINATION EXPENSE. (1) Every insurer or corporation so examined 30 shall, at the direction of the director, payto the examiners and other per-31sons assisting in making the examination,the actual travel expenses, reason- 32 able living expense allowance, and compensation, at reasonable rates customary 33 for such examination and as approved by the director, necessarily incurred on 34 account of the examination, upon presentation of a detailed account of such 35 charges and expenses.A consolidated account of all such charges and expenses36for the examination shall be certified to in duplicate by the insurer or cor-37poration examined, one (1) copy of which shall be retained by such insurer or38corporation and the other copy filed in the department as a public record.39 (2) No person shall pay and no examiner shall accept any additional emol- 40 ument on account of any examination. 41 (3) Andomesticinsurer shall be entitled to offset against its premium 42 taxes payable to the department of insurance of the state of Idaho the exami- 43 nation expense paid by it to or for the account of an examiner, actuary, or 2 1 other assistant designated by the director for the purpose of the examination, 2 inclusive of such personnel as may be so designated on behalf of other states 3 participating in any such examination. The offset, or any remaining portion 4 thereof, will be allowed for any of the five (5) calendar years following the 5 year in which such examination expense was paid. 6(4) The offset provided in subsection (3) of this section shall be appli-7cable to all examination expenses paid in 1983 and successive years.8 SECTION 2. That Section 41-268, Idaho Code, be, and the same is hereby 9 amended to read as follows: 10 41-268. ARSON, FIRE AND FRAUD PREVENTION ACCOUNT. (1) There is hereby 11 created an account in the agency asset fund in the state treasury, to be des- 12 ignated the "arson, fire and fraud prevention account." The account shall be 13 used by the director,of the department of insurance,for enforcement of this 14 act, investigation of alleged cases of arson, fraud and related alleged viola- 15 tions of the laws of this state, and prevention of fire, explosions and other 16 conditions necessary for the public safety, health, peace and welfare. 17 (2) In addition to moneys, if any, appropriated to the account by the 18 legislature, the director shall deposit with the state treasurer for credit to 19 the arson, fire and fraud prevention account: 20 (a) Penalties collected under the provisions of sections 41-261 and 21 41-263, Idaho Code; 22 (b)Assessments and, in the case of surplus lines insurers, fees, col-23lected from insurers as defined by section 41-103, Idaho CodeThat portion 24 of the annual continuation fee as determined by the director pursuant to 25 subsection (3) of this section; 26 (c) Other moneys now or hereinafter in the state fire prevention account; 27 (d) Other moneys or revenues derived from whatever source for arson or 28 fraud investigation or fire prevention. 29 (3)Not more often than annually, assessments against authorized insurers30and fees from surplus lines insurers, as a prerequisite to eligibility under31section 41-1217, Idaho Code, will be levied by the director, and insurers will32pay the assessments or fees levied within sixty (60) days but not later than33March 1 of each year or, in the case of newly applying insurers, upon notifi-34cation of authorization, or of surplus lines eligibility. Assessments and fees35from surplus lines insurers, will be as follows:36(a) Insurers writing coverages as defined in section 41-504, Idaho Code,37"property insurance," section 41-505, Idaho Code, "marine and transporta-38tion," section 41-506, Idaho Code, "casualty insurance," and section3941-3101, Idaho Code, "domestic county mutual fire insurers, associations40or organizations," not less than one hundred dollars ($100) nor more than41five hundred dollars ($500) annually; and42(b) Insurers including, but not limited to, those defined in sections4341-3201, 41-3403 and 41-3903, Idaho Code, not writing coverages, as44defined above in subsection (3)(a), shall pay one-half (1/2) the assess-45ment made under the preceding subsection but not less than fifty dollars46($50.00) nor more than two hundred fifty dollars ($250) annuallyA portion 47 of the annual continuation fee, as determined by the director, will be 48 used to fund the arson, fire and fraud account. 49 (4) All claims against the account shall be examined, audited and allowed 50 in the manner now or hereafter provided by law. 51 (5) All moneys placed in the account are hereby perpetually appropriated 52 to the department of insurance for the purposes of the provisions of this sec- 53 tion. 3 1 (6) Pending use for purposes of the provisions of this section, moneys in 2 the account shall be invested by the state treasurer in the same manner as 3 provided under section 67-1210, Idaho Code, with respect to other surplus or 4 idle moneys in the state treasury. Interest earned on the investments shall be 5 returned to the account. 6 SECTION 3. That Section 41-319, Idaho Code, be, and the same is hereby 7 amended to read as follows: 8 41-319. APPLICATION FOR CERTIFICATE OF AUTHORITY. To apply for an origi- 9 nal certificate of authority an insurer shall file with the director its 10 application therefor, accompanied by the applicable feesas specified inset 11 forth by rule pursuant to section 41-401, Idaho Code, showing its name, loca- 12 tion of its home office or principal office in the United States (if an alien 13 insurer), the kinds of insurance to be transacted, date of organization or 14 incorporation, form of organization, state or country of domicile, and such 15 additional information as the director may reasonably require, together with 16 the following documents, as applicable: 17 (1) If a corporation, two (2) copies (photostatic copies or similar form 18 of reproduction) of its corporate charter, articles of incorporation or other 19 charter documents, with all amendments thereto, currently certified by the 20 public official with whom the originals are on file in the state or country of 21 domicile. 22 (2) If a domestic insurer or mutual insurer, one (1) copy (photostatic 23 copy or similar form of reproduction) of its bylaws as amended, certified by 24 the insurer's corporate secretary. 25 (3) If a reciprocal insurer, a copy of the power of attorney of its 26 attorney in fact, and a copy of its subscribers' agreement, if any, both cer- 27 tified by the attorney in fact; and if a domestic reciprocal insurer, the dec- 28 laration provided for in section 41-2908, Idaho Code. 29 (4) A complete copy of its financial statement as of not earlier than the 30 December 31 next preceding in form as customarily used in the United States by 31 like insurers, sworn to by at least two (2) executive officers of the insurer, 32 or certified by the public insurance supervisory official of the insurer's 33 state of domicile or of entry into the United States. 34 (5) Copy of report of last examination, if any, made of the insurer 35 within not more than three (3) years next preceding, certified by the public 36 insurance supervisory official of the insurer's state of domicile or of entry 37 into the United States; or, in the case of newly formed insurers, copy of the 38 report of the "qualifying" examination of the insurer, similarly certified. 39 Provided, however, that if the law of the applicant's state of domicile 40 requires that examinations shall be completed in a period of more than three 41 (3) years or does not specify any period of time for examinations, then the 42 applicant shall provide a copy of a report within not more than the five (5) 43 years next preceding. 44 (6) Appointment of the director pursuant to section 41-333, Idaho Code, 45 as its attorney to receive service of legal process. 46 (7) If a foreign insurer, a certificate of the public insurance supervi- 47 sory official of its state or country of domicile showing that it is autho- 48 rized to transact in such state or country the kind or kinds of insurance pro- 49 posed to be transacted in this state. 50 (8) If aworkmen'sworker's compensation insurer, tender of the special 51 deposit required under section 41-317, Idaho Code. 52 (9) If an alien insurer, a copy of the appointment and authority of its 53 United States manager, certified by its officer having custody of its records. 4 1 (10) If a foreign insurer, certificate as to deposit if to be tendered 2 pursuant to section 41-316, Idaho Code. 3 (11) If a life or disability insurer, one (1) copy of the insurer's rate 4 book and of each form of policy proposed to be issued in this state. 5 (12) A certificate of the insurer granting authority to an officer or 6 authorized representative of the insurer to appoint and remove agents. 7 SECTION 4. That Section 41-1105, Idaho Code, be, and the same is hereby 8 amended to read as follows: 9 41-1105. APPLICATION FOR LICENSE. The individual desiring to be licensed 10 as an adjuster shall make written application therefor to the director, on 11 forms as prescribed and furnished by the director. The application shall be 12 accompanied by payment of the fee for the license asspecified inset forth by 13 rule pursuant to section 41-401,(fee schedule)Idaho Code. 14 SECTION 5. That Section 41-1416, Idaho Code, be, and the same is hereby 15 amended to read as follows: 16 41-1416. PERIOD LICENSE EFFECTIVE -- RENEWAL -- FEE -- SUSPENSION OR 17 REVOCATION. (1) Licenses issued to rating organizations under section 41-1415, 18 Idaho Code, shall remain in effect forthreeone (31) years, unless sooner 19 suspended or revoked by the director, and may be renewed for successive 20 periods ofthreeone (31) yearseach upon application of the rating organiza- 21 tion and payment in advance of the license fee. 22 (2) The fee for the license shall be in the amountspecified inset forth 23 by rule pursuant to section 41-401, Idaho Code.(fee schedule) for each three-24year period or part thereof the license is in force.25 (3) The director may suspend or revoke the license if he finds, after a 26 hearing thereon of which notice was duly given to the rating organization, 27 that the rating organization no longer meets the requirements of section 28 41-1415, Idaho Code, or for failure to comply with the director's order as 29 provided in section 41-1432, Idaho Code. 30 SECTION 6. That Section 41-1620, Idaho Code, be, and the same is hereby 31 amended to read as follows: 32 41-1620. RATING ORGANIZATIONS. (1) A corporation, an unincorporated asso- 33 ciation, a partnership or an individual, whether located within or outside 34 this state, may make application to the director for license as a rating orga- 35 nization for such kinds of insurance or subdivisions thereof which are subject 36 to this chapter as are specified in its application, and shall file therewith: 37 (a) a copy of its constitution, its articles of agreement or association or 38 its certificate of incorporation, and of itsby-lawsbylaws, rules and regula- 39 tions governing the conduct of its business,; (b) a list of its members and 40 subscribers,; (c) the name and address of a resident of this state upon whom 41 notices or orders of the director or process affecting such rating organiza- 42 tion may be served; and (d) a statement of its qualifications as a rating 43 organization. If the director finds that the applicant is competent, trustwor- 44 thy and otherwise qualified to act as a rating organization and that its con- 45 stitution, articles of agreement or association or certificate of incorpora- 46 tion, and itsby-lawsbylaws, rules and regulations governing the conduct of 47 its business conform to the requirements of law, he shall issue a license 48 specifying the kinds of insurance or subdivisions thereof for which the appli- 49 cant is authorized to act as a rating organization. Every such application 5 1 shall be granted or denied in whole or in part by the director within sixty 2 (60) days of the date of its filing with him. Licenses issued pursuant to this 3 section shall remain in effect forthreeone (31) yearsunless sooner sus- 4 pended or revoked by the director. The fee for the license shall be as pro- 5 videdinby rule pursuant to section 41-401,(fee schedule)Idaho Code. 6 Licenses issued pursuant to this section may be suspended or revoked by the 7 director, after hearing upon notice, in the event the rating organization 8 ceases to meet the requirements of this subsection. Every rating organization 9 shall notify the director promptly of every change in: (a) its constitution, 10 its articles of agreement or association or its certificate of incorporation, 11 and itsby-lawsbylaws, rules and regulations governing the conduct of its 12 business,; (b) its list of members and subscribers; and (c) the name and 13 address of the resident of this state designated by it upon whom notices or 14 orders of the director or process affecting such rating organization may be 15 served. 16 (2) Subject to rules and regulations which have been approved by the 17 director as reasonable, each rating organization shall permit any insurer, not 18 a member, to be a subscriber to its rating services for any kind of insurance 19 or subdivision thereof for which it is authorized to act as a rating organiza- 20 tion. Notice of proposed changes in such rules and regulations shall be given 21 to subscribers. Each rating organization shall furnish its rating services 22 without discrimination to its members and subscribers. The reasonableness of 23 any rule or regulation in its application to subscribers, or the refusal of 24 any rating organization to admit an insurer as a subscriber, shall, at the 25 request of any subscriber or any such insurer, be reviewed by the director at 26 a hearing held upon at least ten (10) days' written notice to such rating 27 organization and to such subscriber or insurer. If the director finds that 28 such rule or regulation is unreasonable in its application to subscribers, he 29 shall order that such rule or regulation shall not be applicable to sub- 30 scribers. If the rating organization fails to grant or reject an insurer's 31 application for subscribership within thirty (30) days after it was made, the 32 insurer may request a review by the director as if the application had been 33 rejected. If the director finds that the insurer has been refused admittance 34 to the rating organization as a subscriber without justification, he shall 35 order the rating organization to admit the insurer as a subscriber. If he 36 finds that the action of the rating organization was justified, he shall make 37 an order affirming its action. 38 (3) Every member of or subscriber to a rating organization shall adhere 39 to the rating organization's manuals of classifications, rules, rates, rating 40 plans and any modifications of any of the foregoing, except to the extent that 41 the rules of such rating organizations permit departures therefrom. 42 (4) No rating organization shall adopt any rule the effect of which would 43 be to prohibit or regulate the payment of dividends, savings or unabsorbed 44 premium deposits allowed or returned by insurers to theirpolicy holderspoli- 45 cyholders, members or subscribers. 46 SECTION 7. That Section 41-2805, Idaho Code, be, and the same is hereby 47 amended to read as follows: 48 41-2805. FILING OF ARTICLES. (1) The incorporators shall submit the exe- 49 cuted articles of incorporation of a proposed stock or mutual insurer in trip- 50 licate to the director for review. If the director finds the articles to be in 51 compliance with this code he shall deliver an original thereof to the attorney 52 general for examination. After examining the articles, the attorney general 53 shall return them to the director accompanied by his opinion certifying as to 6 1 whether or not he has found the articles to be in accordance with the laws of 2 this state and not inconsistent with the constitution of this state. If the 3 attorney general has found the articles to be in accordance with law, the 4 director shall, upon payment of the fees prescribed by law therefor, and 5 except as provided in subsection (2)belowof this section, certify his 6 approval upon each of the three (3) originals of the articles, file one (1) of 7 such originals in his office, file one (1) of such originals with the secre-8tary of state,and deliveronetwo (12) of such originals to the incorpora- 9 tors, one (1) to be retained by the corporation as part of its corporate 10 records, and one (1) to be filed with the secretary of state. 11 (2) If a permit as to the offer of securities or receipt of funds is to 12 be required with respect to the proposed insurer, as provided for in section 13 41-2806, Idaho Code, the director shall not in any event approve the articles 14 of incorporation until the permit has been issued. 15 (3) If upon reviewing or examining the articles of incorporation as here- 16 inabove provided, the director or the attorney general finds that the articles 17 do not comply with this code or are not in accordance with the laws of this 18 state, or are inconsistent with the constitution of this state, as the case 19 may be, or that the permit referred to in subsection (2)aboveof this section 20 will not be issued, the director shall refuse to approve the articles and 21 shall return all originals of the articles to the incorporators accompanied by 22 a written statement of the defects in the articles or reasons upon which his 23 refusal is based.The director shall at the same time refund any unearned fil-24ing fees.25 (4) The secretary of state shall not permit the filing with him or in his 26 office of any such articles of incorporation unless the same bear the 27 director's approval endorsed thereon as hereinabove provided. The director's 28 approval, when so endorsed, shall be deemed to relate only to the form of the 29 articles of incorporation, and shall not be deemed to constitute an approval 30 orcommittmentcommitment by the director as to any other aspect or operation 31 of the proposed insurer. 32 (5) The director and the attorney general shall perform all duties 33 required of them under this section within a reasonable time after the arti- 34 cles of incorporation have been submitted to the director as in subsection (1) 35 above provided. 36 SECTION 8. That Section 41-2810, Idaho Code, be, and the same is hereby 37 amended to read as follows: 38 41-2810. GRANTING OR DENIAL OF PERMIT. (1) The director and the director 39 of the department of finance, where applicable, shall expeditiously examine an 40 application for a solicitation permit as soon as it is completed, and make 41 such further investigation of the proposals as may be required or deemed nec- 42 essary. Subject to subsection (2)belowof this section, if it is found on 43 such examination and investigation that: 44 (a) The application is complete,; and 45 (b) The documents therewith filed are proper in form,; and 46 (c) The proposed financial structure is adequate. 47 The director shall give notice to the applicant that he will approve and 48 file the articles of incorporation (if a proposed corporation) and that a 49 solicitation permit will be issued, stating the terms to be contained therein, 50 upon the filing of any bond required by section 41-2814 orsection41-2821, 51 Idaho Code. 52 (2) If the director or director of the department of finance does not so 53 find, or finds that: 7 1 (a) Any corporation, syndicate, association, firm, partnership, or orga- 2 nization the shares, memberships (other than membership in a mutual 3 insurer by virtue of being apolicy holderpolicyholder therein), inter- 4 ests, or ownership equities, by whatever name called, of which are pro- 5 posed to be offered or sold has existing or prospective more than one (1) 6 class of shares, memberships, interests, or ownership equities,; or 7 (b) Any proposed sale of securities would be or tend to be fraudulent or 8 inequitable as to present or proposed security holders or investors,; or 9 (c) Any of the individuals associated or to be associated in the insurer, 10 corporation, syndicate, association, partnership, firm, organization, or 11 financing are not of good character,; or that 12 (d) The proposed insurer if formed, or if an applicant for a certificate 13 of authority would not be able to qualify for a certificate of authority 14 by virtue of the provisions of section 41-308(2),of this code,Idaho 15 Code; 16 He shall give notice to the applicant that a solicitation permit will not 17 be granted, stating the particulars of the grounds therefor, and return any 18 proposed articles of incorporation to the applicant.and refund to the appli-19cant all sums deposited in connection with the application except the fee for20filing the application for the permit.21 SECTION 9. That Section 41-3410, Idaho Code, be, and the same is hereby 22 amended to read as follows: 23 41-3410. ISSUANCE OR REFUSAL OF CERTIFICATE OF AUTHORITY. (1) If after 24 the application for certificate of authority is completed the director finds 25 that the applicant is fully qualified for a certificate of authority in accor- 26 dance with the provisions of this chapter, and that the service agreements, 27 subscriber's contracts, and schedule of rates are in compliance with the 28 applicable provisions of this chapter, he shall issue to the applicant a cer- 29 tificate of authority as a professional service corporation. 30 (2) If the director does not so find, he shall refuse to issue a certifi- 31 cate of authority and shall give the applicant written notice thereof setting 32 forth the particulars of the reasons for such refusal, accompanied by return33of the fee theretofore tendered for issuance of the certificate of authority. 34 (3) The director shall either issue or refuse to issue the certificate of 35 authority within a reasonable time after the filing and completion of applica- 36 tion therefor. 37 SECTION 10. That Section 41-3716, Idaho Code, be, and the same is hereby 38 amended to read as follows: 39 41-3716. EXAMINATION OF BOOKS, RECORDS AND ACCOUNTS. (1) The books, 40 records, accounts and affairs of a hospital trust shall be subject to examina- 41 tion by the director, by competent examiners duly authorized by him in writ- 42 ing, at such times or intervals as the director deems advisable. The purposes 43 of the examination shall be to determine compliance of the trust with applica- 44 ble laws, financial condition and actuarial adequacy of the trust fund, and as 45 to other factors materially related to the trust's management and operation. 46 (2) The trustee shall make the books, records and accounts of the trust 47 and trust fund available to the examiner and otherwise facilitate the examina- 48 tion. 49 (3) The examiner shall conduct the examination expeditiously, make his 50 report of the examination in writing, and deliver a copy thereof to the 51 trustee and the director. The trustee shall have two (2) weeks after receipt 8 1 of the report within which to recommend to the director such corrections or 2 changes therein as the trustee may deem appropriate. After making such correc- 3 tions or changes, if any, as he deems proper, the director shall file the 4 report in his office as a document open to public inspection, and deliver to 5 the trustee a copy of the report as so corrected or changed. 6 (4) At the direction of the director, tThe costs of the examination shall 7 be borne by the trust fund of the hospital trust. The trustee shall pay to the8examiner and other persons assisting in making the examination, the actual9travel expenses, reasonable living expense allowance, and compensation, at10reasonable rates customary for such examination and as approved by the direc-11tor, necessarily incurred on account of the examination, upon presentation of12a detailed account of all such charges and expenses. A consolidated account of13all such charges and expenses for the examination shall be certified to in14duplicate by the trustee of the hospital trust examined, one (1) copy of which15shall be retained by the trust and the other copy filed in the department as a16public recordin accordance with section 41-228, Idaho Code. 17 SECTION 11. That Section 41-3911, Idaho Code, be, and the same is hereby 18 amended to read as follows: 19 41-3911. EXAMINATIONS. (1) The director shall make an examination of the 20 affairs and operations of any organization offering a managed care plan for 21 which a certificate of authority is required as often as he deems necessary 22 but not less frequently than once every five (5) years. 23 (2) Every such organization shall upon the director's request submit its 24 books and records relating to its affairs and operations to such examination 25 and shall facilitate the examination. 26 (3) Health records of individuals and records of providers providing ser- 27 vices under a contract with the managed care organization shall not be subject 28 to such examination, except as provided in section 41-3909(3), Idaho Code. 29 (4) At the direction of the director, tThe expenses of examination shall 30 be borne by the organization being examinedand remitted by it to the director31upon submission of an itemized written statementin accordance with section 32 41-228, Idaho Code. 33 SECTION 12. That Section 41-4013, Idaho Code, be, and the same is hereby 34 amended to read as follows: 35 41-4013. EXAMINATION OF BOOKS, RECORDS AND ACCOUNTS. (1) The books, 36 records, accounts and affairs of a self-funded plan shall be subject to exami- 37 nation by the director, by competent examiners duly authorized by him in 38 writing, at such times or intervals as the director deems advisable. The pur- 39 poses of the examination shall be to determine compliance of the plan with 40 applicable laws, financial condition and actuarial adequacy of its trust fund, 41 treatment accorded beneficiaries, and as to other factors materially related 42 to the plan's management and operation. 43 (2) The trustee shall make the books, records and accounts of the plan 44 and trust fund available to the examiner and otherwise facilitate the examina- 45 tion. 46 (3) The examiner shall conduct the examination expeditiously, make his 47 report of the examination in writing, and deliver a copy thereof to the 48 trustee and the director. The trustee shall have two (2) weeks after receipt 49 of the report within which to recommend to the director such corrections or 50 changes therein as the trustee may deem appropriate. After making such correc- 51 tions or changes, if any, as he deems proper, the director shall file the 9 1 report in his office as a document open to public inspection, and deliver to 2 the trustee a copy of the report as so corrected or changed. 3 (4) At the direction of the director, tThe costs of the examination shall 4 be borne by the trust fund of the plan, and shall be paid by the trusteeupon5receipt from the director of an itemized written statement thereof. The costs6shall include only travel expense actually and reasonably incurred by the7examiner and compensation (other than salary, if any) received or to be8received by the examiner for time actually spent in the examination and prepa-9ration of the examination reportin accordance with section 41-228, Idaho 10 Code. 11 SECTION 13. That Section 41-4935, Idaho Code, be, and the same is hereby 12 amended to read as follows: 13 41-4935. EXAMINATION OF BOOKS, RECORDS AND ACCOUNTS. (1) The books, 14 records, accounts and affairs of the trust fund shall be subject to examina- 15 tion by the director by competent examiners duly authorized by him in writing, 16 at such times or intervals as the director deems advisable. The purposes of 17 the examination shall be to determine compliance of the trust fund with appli- 18 cable laws, the financial condition and actuarial adequacy of the trust fund, 19 and other factors materially related to the trust fund's management and opera- 20 tion. 21 (2) The manager, as trustee, shall make the books, records and accounts 22 of the trust fund available to the examiner and otherwise facilitate the exam- 23 ination. 24 (3) The examiner shall conduct the examination expeditiously, make his 25 report of the examination in writing, and deliver a copy thereof to the 26 trustee and the director. The manager, as trustee, shall have two (2) weeks 27 after receipt of the report within which to recommend to the director such 28 corrections or changes therein as the manager, as trustee, may deem appropri- 29 ate. After making such corrections or changes, if any, as he deems proper, the 30 director shall file the report in his office as a document open to public 31 inspection, and deliver to the manager, as trustee, a copy of the report as so 32 corrected or changed. 33 (4) At the direction of the director, tThe costs of the examination 34 shall be borne by the trust fund. The manager, as trustee, shall pay to the35examiner and other persons assisting in making the examination, the actual36travel expenses, reasonable living expense allowance, and compensation, at37reasonable rates customary for such examination and as approved by the direc-38tor, necessarily incurred on account of the examination, upon presentation of39a detailed account of all such charges and expenses. A consolidated account of40all such charges and expenses for the examination shall be certified to in41duplicate by the manager, as trustee, one (1) copy of which shall be retained42by the trust fund and the other copy filed in the department as a public43recordin accordance with section 41-228, Idaho Code. 44 SECTION 14. That Section 72-914, Idaho Code, be, and the same is hereby 45 amended to read as follows: 46 72-914. ACCOUNTS. The manager shall keep an account of the money paid in 47 premiums by each of the several classes of employments, and the expense of 48 administering the state insurance fund, and the disbursements on account of 49 injuries and deaths of employees in each of said classes, including the set- 50 ting up of reserves adequate to meet anticipated and unexpected losses and to 51 carry the claims to maturity; and also an account of the money received from 10 1 each individual employer; and of the amount disbursed from the state insurance 2 fund for expenses, and on account of injuries and disablement and death of the 3 employees of such employer, including the reserves so set up. 4 Examination of Fund: The state insurance fund shall be examined by the 5 department of insurance at least once in three (3) years. For such purpose the 6commissionerdirector of the department of insurance shall appoint as examiner 7 one (1) or more competent persons not officers of or connected with any insur- 8 ance corporation other than as policyholders. The examiner or examiners so 9 appointed shall make a full and true report of such examination, verified 10 under oath, and such report when completed shall be included in and made a 11 part of any report required by law to be made by the fund to the governor of 12 this state. At the direction of the director of the department of insurance, 13 tThe costs of such examination shall be paid by the fundand shall include the14reasonable expenses of the department of insurance and the compensation and15reasonable expenses of the person or persons making the examinationin accor- 16 dance with section 41-228, Idaho Code. 17 Thecommissionerdirector of the department of insurance shall transmit to 18 the governor a copy of the official examination of the state insurance fund 19 immediately upon its completion by the examiner or examiners, and a copy of 20 such examination report shall be filed in the department of insurance and be 21 open to public inspection.
STATEMENT OF PURPOSE
RS 10555C1
The Department of Insurance changed its fee collection system
for insurers and other non-agent or broker entities, effective
July 1, 2000, to that based primarily on a single annual
continuation fee, and the Department eliminated the collection
of several other fees pursuant to IDAPA 18.01.44. This
legislation is designed to clarify portions of the code and
make them consistent with the Department's recent change in how
it collects fees. The proposed legislation would reduce confusion
and make the code and Department rule consistent. The proposed
legislation will also clarify the process by which premium tax
revenue is calculated and paid to the Idaho Individual High
Risk Reinsurance Pool pursuant to Idaho Code 41-406(1)(d).
FISCAL IMPACT
It is expected that this proposed legislation will have no fiscal
impact on the general fund.
CONTACT
Name: Robert C. Murphy, Department of Insurance
Phone: (208) 334-4250
Statement of Purpose/Fiscal Note Bill No. H25