304.2-230 Conduct of examination -- Immunity for examiners -- Access to records -
- Corrections -- Penalty.
(1) Whenever the commissioner determines to examine the affairs of any person, he
shall designate one or more examiners and instruct them as to the scope of the <br>examination. The examiner shall, upon demand, exhibit his official credentials to <br>the person under examination. In conducting the examination, the examiner shall <br>observe those guidelines and procedures set forth in the Examiners' Handbook <br>adopted by the National Association of Insurance Commissioners. The <br>commissioner may also employ other guidelines or procedures as the commissioner <br>deems appropriate.
(2) (a) An examiner may not be appointed by the commissioner if the examiner,
either directly or indirectly, has a conflict of interest or is affiliated with the <br>management of or owns a pecuniary interest in any person subject to <br>examination. This subsection shall not be construed to automatically preclude <br>an examiner from being: <br>1.
A policyholder or claimant under an insurance policy;
2.
A grantor of a mortgage or similar instrument on the examiner's <br>residence to a regulated entity if done under customary terms and in the <br>ordinary course of business;
3.
An investment owner in shares of regulated diversified investment <br>companies; or
4.
A settler or beneficiary of a "blind trust" into which any otherwise <br>impermissible holdings have been placed.
(b) Notwithstanding the requirements of paragraph (a) of this subsection, the
commissioner may retain from time to time, on an individual basis, qualified <br>actuaries, certified public accountants, or other similar individuals who are <br>independently practicing their professions even though these persons may <br>from time to time be similarly employed or retained by persons subject to <br>examination.
(3) Any person performing an examination of an insurer on behalf of, and as called by,
the commissioner shall have official immunity and shall be immune from suit and <br>liability, both personally and in their official capacities, for any claim for damage to, <br>or loss of property, or personal injury, or other civil liability caused by or resulting <br>from any alleged act, error, or omission of the examiner or any assistant or <br>contractor arising out of, or by reason of, their duties or employment. Nothing in <br>this subsection shall be construed to hold the examiner or any assistant or contractor <br>immune from suit and liability for any damage, loss, injury, or liability caused by <br>the intentional or willful and wanton misconduct of the examiner, any assistant, or <br>contractor.
(4) The commissioner shall conduct such examination in an expeditious, fair and
impartial manner.
(5) Upon any such examination the commissioner, or the examiner if specifically so
authorized in writing by the commissioner, shall have power to issue subpoenas,
administer oaths, and to examine under oath any individual as to any matter relevant <br>to the affairs under examination or relevant to the examination.
(6) Every person being examined, its officers, attorneys, employees, agents and
representatives shall make freely available to the commissioner or his examiners the <br>accounts, records, documents, files, information, assets and matters of such person <br>in his possession or control relating to the subject of the examination and shall <br>facilitate the examination.
(7) Neither the commissioner nor any examiner shall remove any record, account,
document, file or other property of the person being examined from the offices or <br>place of such person except with the written consent of such person in advance of <br>such removal or pursuant to an order of court duly obtained. This provision shall <br>not be deemed to affect the making and removal of copies or abstracts of any such <br>record, account, document or file.
(8) Any individual who refuses without just cause to be examined under oath or who
willfully obstructs or interferes with the examiners in the exercise of their authority <br>pursuant to this section is guilty of a violation of this code.
(9) The commissioner may terminate or suspend an examination in order to pursue
other legal or regulatory action pursuant to the insurance laws of this state. Findings <br>of fact and conclusions made pursuant to an examination shall be prima facie <br>evidence in any legal or regulatory action. The commissioner may use and, if <br>appropriate, may make public any final or preliminary examination report, any <br>examiner's workpapers or other documents, or any other information discovered or <br>developed during the course of the examination in the furtherance of any legal or <br>regulatory action that the commissioner may, in his sole discretion, deem <br>appropriate. Nothing in this subsection shall be binding upon the court in making <br>determinations about relevancy and admissibility in any civil action pertaining to <br>any such documents.
Effective: July 15, 2010 <br>History: Amended 2010 Ky. Acts ch. 24, sec. 940, effective July 15, 2010. -- Amended
2008 Ky. Acts ch. 152, sec. 2, effective July 15, 2008. -- Created 1970 Ky. Acts <br>ch. 301, subtit. 2, sec. 23, effective June 18, 1970.
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