2013 Oklahoma Statutes
Title 36 - Insurance


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<html> <head> <STYLE type="text/css"> body {padding-left:90pt;width:612pt} p {margin-top:0pt;margin-bottom:0pt} .cls4 {font-family:'Courier New', monospace;} .cls5 {font-size:12pt;} .cls0 {font-size:12pt;font-family:'Courier New', monospace;} .cls2 {margin-left:100pt;} .cls18 {margin-left:100pt;margin-right:100pt;} .cls9 {margin-left:100pt;margin-right:118pt;} .cls19 {margin-left:100pt;margin-right:124pt;} .cls10 {margin-left:100pt;margin-right:94pt;} .cls36 {margin-left:101pt;} .cls28 {margin-left:108pt;} .cls34 {margin-left:129pt;} .cls3 {margin-left:136pt;} .cls11 {margin-left:136pt;margin-right:100pt;} .cls29 {margin-left:144pt;} .cls12 {margin-left:172pt;} .cls13 {margin-left:172pt;margin-right:106pt;} .cls24 {margin-left:180pt;} .cls14 {margin-left:208pt;} .cls25 {margin-left:216pt;} .cls38 {margin-left:28pt;margin-right:28pt;} .cls32 {margin-left:43pt;margin-right:208pt;} .cls31 {margin-left:43pt;margin-right:249pt;} .cls7 {margin-left:57pt;} .cls6 {margin-left:57pt;margin-right:180pt;} .cls16 {margin-left:57pt;margin-right:88pt;} .cls30 {margin-left:64pt;} .cls17 {margin-left:64pt;margin-right:82pt;} .cls20 {margin-left:64pt;margin-right:95pt;} .cls21 {margin-left:72pt;} .cls33 {margin-left:90pt;} .cls37 {margin-left:93pt;} .cls8 {margin-left:93pt;margin-right:180pt;} .cls27 {margin-right:10pt;} .cls26 {margin-right:19pt;} .cls22 {margin-right:1pt;} .cls23 {margin-right:7pt;} .cls15 {text-align:center;} .cls35 {text-align:center;margin-left:208pt;} .cls1 {text-align:justify;} </STYLE> <title>&sect;36 101</title> </head> <body> <p><span class="cls0">&sect;36101. Short title.&nbsp;</span></p> <p><span class="cls0">Title 36 of the Oklahoma Statutes shall be known and may be cited as the Oklahoma Insurance Code.&nbsp;</span></p> <p class="cls1"><span class="cls0">Amended by Laws 1983, c. 68, &sect; 1, eff. Nov. 1, 1983. &nbsp;</span></p> <p><span class="cls0">&sect;36102. "Insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Insurance" is a contract whereby one undertakes to indemnify another or to pay a specified amount upon determinable contingencies.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 215, &sect; 102. &nbsp;</span></p> <p><span class="cls0">&sect;36103. "Insurer" defined.&nbsp;</span></p> <p><span class="cls0">A. "Insurer" includes every person engaged in the business of making contracts of insurance or indemnity.&nbsp;</span></p> <p><span class="cls0">B. A nonprofit hospital service and medical indemnity corporation is an insurer within the meaning of this Code.&nbsp;</span></p> <p><span class="cls0">C. Burial associations shall be deemed not to be insurers.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 215, &sect; 103. &nbsp;</span></p> <p><span class="cls0">&sect;36104. "Person" defined.&nbsp;</span></p> <p><span class="cls0">"Person" includes an individual, company, insurer, association, organization, society, reciprocal or interinsurance exchange, partnership, syndicate, business trust, corporation, Lloyd's association, and entity, and association, group or department of underwriters and any farmer&rsquo;s educational and cooperative union.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 216, &sect; 104, operative July 1, 1957. Amended by Laws 2004, c. 16, &sect; 1, eff. Nov. 1, 2004.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36105. "Transacting" insurance.&nbsp;</span></p> <p><span class="cls0">"Transact" with respect to insurance includes any of the following:&nbsp;</span></p> <p><span class="cls0">1. Solicitation and inducement.&nbsp;</span></p> <p><span class="cls0">2. Preliminary negotiations.&nbsp;</span></p> <p><span class="cls0">3. Effectuation of a contract of insurance.&nbsp;</span></p> <p><span class="cls0">4. Transaction of matters subsequent to effectuation of the contract and arising out of it.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 216, &sect; 105. &nbsp;</span></p> <p><span class="cls0">&sect;36106. "Insurance Commissioner" defined.&nbsp;</span></p> <p><span class="cls0">A. When used with reference to administration of this Code, "Insurance Commissioner" or "Commissioner" means the Insurance Commissioner of the State of Oklahoma.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 216, &sect; 106. &nbsp;</span></p> <p><span class="cls0">&sect;36-107. "Board" defined.&nbsp;</span></p> <p><span class="cls0">When used with reference to the administration of the Oklahoma Insurance Code, "State Insurance Board", "Insurance Board" or "Board" means the State Board for Property and Casualty Rates established by Section 331, Article 3, of this Code. For purposes of the laws of this state and the Oklahoma Insurance Code, the term &ldquo;Board&rdquo; or &ldquo;any predecessor to the Board&rdquo; shall have the same meaning as the term &ldquo;Insurance Commissioner&rdquo;.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 216, &sect; 107, operative July 1, 1957. Amended by Laws 1965, c. 60, &sect; 1, eff. July 1, 1965; Laws 2006, c. 264, &sect; 1, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-107.2. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36108. "Insurance Department" defined.&nbsp;</span></p> <p><span class="cls0">Unless the context otherwise requires, "Insurance Department" or "Department" means the Insurance Department established by Section 301, Article 3 of this Code.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 216, &sect; 108. &nbsp;</span></p> <p><span class="cls0">&sect;36109. Compliance required.&nbsp;</span></p> <p><span class="cls0">No person shall transact a business of insurance in Oklahoma without complying with the applicable provisions of this Code.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 216, &sect; 109. &nbsp;</span></p> <p><span class="cls0">&sect;36-110. Application as to particular types of insurers.&nbsp;</span></p> <p><span class="cls0">No provision of the Oklahoma Insurance Code, Section 101 et seq. of this title, shall apply to:&nbsp;</span></p> <p><span class="cls0">1. Nonprofit hospital service and medical indemnity corporations, except as stated in Sections 601 et seq. and 2601 et seq. of this title;&nbsp;</span></p> <p><span class="cls0">2. Fraternal benefit societies, except as stated in Section 2701.1 et seq. of this title;&nbsp;</span></p> <p><span class="cls0">3. Farmers' mutual fire insurance associations, except as stated in Section 2801 et seq. of this title;&nbsp;</span></p> <p><span class="cls0">4. Mutual benefit associations, except as stated in Section 2401 et seq. of this title;&nbsp;</span></p> <p><span class="cls0">5. Domestic burial associations;&nbsp;</span></p> <p><span class="cls0">6. Any domestic association organized subject to the supervision or by the authority of any incorporated Grange Order of Patrons of Husbandry, when the association is formed exclusively for the mutual benefit of the members of such order. Effective January 1, 1982, The Oklahoma State Union of the Farmers' Educational and Cooperative Union of America shall comply with all provisions of the Oklahoma Insurance Code;&nbsp;</span></p> <p><span class="cls0">7. Trust companies organized pursuant to the provisions of Title 6 of the Oklahoma Statutes except that the title insurance and surety insurance business of such trust companies shall be subject to the Oklahoma Insurance Code;&nbsp;</span></p> <p><span class="cls0">8. Soliciting agents of mutual insurance corporations or associations, operating only in this state, that issue no stock or other form of security, do not operate for profit, and have none of their funds inure to the benefit of individuals except in the form of less expensive insurance and necessary expenses of operation, if provisions are made in the bylaws of the insurer for the election of any soliciting agents by a majority of the policyholders in the area where the soliciting agent solicits insurance;&nbsp;</span></p> <p><span class="cls0">9. The Mutual Aid Association of the Church of the Brethren or the Mutual Aid Association of the Mennonite and Brethren in Christ;&nbsp;</span></p> <p><span class="cls0">10. Incorporated or unincorporated banking associations having been in existence for over fifteen (15) years and consisting of more than seventy-five (75) member banks within this state for issuance of blanket fidelity bonds for banks within this state for each bank's own use, or any nonprofit trust sponsored by such associations' member banks providing employee benefits such as life, health, accident, disability, pension and retirement benefits for banks, bank holding companies and subsidiaries thereof, the associations' employees and associate members;&nbsp;</span></p> <p><span class="cls0">11. A religious organization, or members of the organization, if the organization:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;is a nonprofit religious organization,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;is limited to participants who are members of the same religion,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;acts as an organizational clearinghouse for information between participants who have financial, physical or medical needs and participants with the present ability to pay for the benefit of those participants with present financial or medical needs. Nothing in this subparagraph shall prevent the organization from establishing qualifications of participation relating to the health of the prospective participant, nor shall it prevent the participants from limiting the financial or medical needs that may be eligible for payment among the participants,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;provides for the financial or medical needs of a participant through payments directly from one participant to another, and&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;suggests amounts that participants may voluntarily give with no assumption of risk or promise to pay either among the participants or between the participants and the organization. Nothing in this subparagraph shall prevent the organization from cancelling the membership of a participant if the participant indicates unwillingness to participate by failing to make a payment to another participant for a period in excess of sixty (60) days; or&nbsp;</span></p> <p><span class="cls0">12. Charitable organizations that:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;are described in Section 501(c)(3) of the Internal Revenue Code and Section 170(c) of the Internal Revenue Code,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;issue qualified charitable gift annuity contracts,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;have a minimum of One Hundred Thousand Dollars ($100,000.00) in unrestricted assets that are exclusive of the assets comprising its qualified charitable gift annuities, and&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;have been in continuous operation for at least three (3) years or are successors or affiliates of a charitable organization that has been in continuous operation for at least three (3) years,&nbsp;</span></p> <p><span class="cls0">except as stated in the Oklahoma Charitable Gift Annuity Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 216, &sect; 110. Amended by Laws 1975, c. 334, &sect; 1, emerg. eff. June 12, 1975; Laws 1979, c. 56, &sect; 1, emerg. eff. April 11, 1979; Laws 1982, c. 190, &sect; 1, operative Oct. 1, 1982; Laws 1984, c. 110, &sect; 1, eff. Nov. 1, 1984; Laws 1988, c. 83, &sect; 3, emerg. eff. March 25, 1988; Laws 1993, c. 34, &sect; 1, emerg. eff. April 2, 1993; Laws 1994, c. 118, &sect; 1, eff. Sept. 1, 1994; Laws 1996, c. 249, &sect; 1, emerg. eff. May 28, 1996; Laws 1997, c. 418, &sect; 2, eff. Nov. 1, 1997; Laws 1998, c. 141, &sect; 13, emerg. eff. April 21, 1998; Laws 2008, c. 352, &sect; 1, eff. Nov. 1, 2008.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36114. Existing actions, violations.&nbsp;</span></p> <p><span class="cls0">Repeal by this act of any law shall not affect or abate any right heretofore accrued, action or proceeding heretofore commenced, or any unlawful act heretofore committed under such laws and punishment or deprivation of license or authority as a consequence thereof as provided by such law, but all proceedings hereafter taken with respect thereto shall conform to the applicable provisions of this Code insofar as possible. All such laws shall be deemed to continue in force to the extent made necessary by this provision.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 217, &sect; 114. &nbsp;</span></p> <p><span class="cls0">&sect;36115. Particular provisions prevail.&nbsp;</span></p> <p><span class="cls0">Provisions of this Code relative to a particular kind of insurance or a particular type of insurer or to a particular matter shall prevail over provisions relating to insurance in general or insurers in general or to such matter in general.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 217, &sect; 115. &nbsp;</span></p> <p><span class="cls0">&sect;36117. General penalty.&nbsp;</span></p> <p><span class="cls0">In addition to any other penalty which may be applicable thereto, either under this Code or otherwise, violation of any provision of this Code shall constitute a misdemeanor and shall be punishable as such where no greater penalty is provided therefor.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 217, &sect; 117. &nbsp;</span></p> <p><span class="cls0">&sect;36-121. Computation of time periods.&nbsp;</span></p> <p><span class="cls0">In computing any period of time prescribed or allowed by this title, by the rules of the Commissioner, or by any applicable statute, the day of the act, event, or default from which the designated period of time begins to run shall not be included. The last day of the period so computed shall be included, unless it is a Saturday, a Sunday, a legal holiday as defined by the Oklahoma Statutes, or any day when the office of the Commissioner does not remain open for public business until 4:00 p.m., in which event the period runs until the end of the next day when the office of the Commissioner is open until 4:00 p.m. When the period of time prescribed or allowed is less than seven (7) days, intermediate Saturdays, Sundays and legal holidays shall be excluded in the computation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 3, eff. Nov. 1, 1997. Amended by Laws 2006, c. 264, &sect; 2, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-122. Electronic filing of documents.&nbsp;</span></p> <p><span class="cls0">A. The Commissioner shall have the authority to require any entity obligated to submit or file documents with the Insurance Department to file the documents electronically.&nbsp;</span></p> <p><span class="cls0">B. The documents referred to in subsection A of this section include, but are not limited to, forms for compliance, rate filings, or annual, quarterly, or other financial statements.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner may promulgate reasonable and necessary rules concerning the implementation of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2010, c. 222, &sect; 1, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-301. Insurance Department.&nbsp;</span></p> <p><span class="cls0">The Insurance Department of the State of Oklahoma is hereby created. The Insurance Commissioner shall be the chief executive officer of the Insurance Department. The powers and duties of the Insurance Commissioner shall be those created by the Oklahoma Insurance Code. The Insurance Department shall be situated in one area in the State Capitol or some other location conveniently accessible to the general public subject to the provisions of Sections 63 and 94 of Title 74 of the Oklahoma Statutes and Section 580:20-13-5 of the Oklahoma Administrative Code.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 217, &sect; 301, operative July 1, 1957. Amended by Laws 1965, c. 60, &sect; 2, eff. July 1, 1965; Laws 1980, c. 322, &sect; 2, eff. Jan. 1, 1981; Laws 1986, c. 207, &sect; 76, operative July 1, 1986; Laws 1987, c. 210, &sect; 1, eff. July 1, 1987; Laws 1996, c. 10, &sect; 1, emerg. eff. March 26, 1996; Laws 2006, c. 264, &sect; 3, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36302. Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner of the State of Oklahoma shall be at least twentyfive (25) years of age and a resident of the State of Oklahoma for at least five (5) years, and have had at least five (5) years' experience in the insurance industry in administration, sales, servicing or regulation. The Insurance Commissioner shall not be financially interested, directly or indirectly, in any insurer, agency or insurance transaction except as a policyholder or claimant under a policy.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Amended by Laws 1983, c. 68, &sect; 2, eff. Nov. 1, 1983. &nbsp;</span></p> <p><span class="cls0">&sect;36303. Official seal of Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner shall have an official seal, the center of which shall be the same as that of the Great Seal of the State of Oklahoma, and which shall be distinguished by the words "Insurance Commissioner State of Oklahoma" inscribed in the circular band surrounding the remainder of the device. This seal shall be the official seal of the office. Every certificate and other document or paper duly executed by the Insurance Commissioner, authorized employees of the Insurance Department, or independent hearing examiners and all copies or photographic copies of papers certified by authority of the Commissioner and authenticated by the seal shall have the same force and effect as the original would in any suit or proceedings in any court of this state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 218, &sect; 303. Amended by Laws 1997, c. 418, &sect; 4, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-304. Funds to be deposited weekly - Collection by nongovernmental entities.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall deposit weekly with the State Treasurer all funds in the Commissioner&rsquo;s hands collected for the use of the state.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner may contract with nongovernmental entities to collect fees and taxes on behalf of the Insurance Department.&nbsp;</span></p> <p><span class="cls0">Laws 1957, p. 218, &sect; 304; Laws 1980, c. 159, &sect; 4, emerg. eff. April 2, 1980; Laws 2007, c. 338, &sect; 1, eff. July 1, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-305. Commissioner may appoint assistants; legal counsel.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may appoint such deputies, assistants, examiners, actuaries, attorneys, clerks and employees, at salaries to be fixed by the Insurance Commissioner, as may be necessary properly to discharge the duties imposed upon the Insurance Commissioner under this Code. The Insurance Commissioner shall appoint all examiners for his office. The attorneys appointed by the Insurance Commissioner shall be the legal advisors for the office of Insurance Commissioner and are authorized to appear for and represent the Insurance Commissioner in any and all litigation that may arise in the discharge of his duties except as otherwise provided elsewhere in this Code. Provided, the Insurance Commissioner, whenever he deems it necessary, may call upon the Attorney General of the State of Oklahoma for legal counsel, and such assistance as may be required to enforce provisions of this Code.&nbsp;</span></p> <p><span class="cls0">B. No deputy, assistant or employee of the Commissioner shall be financially interested, directly or indirectly, in any insurer, agency or insurance transaction except as a policyholder or claimant under a policy; except, that as to such matters wherein a conflict of interests does not exist on the part of any such individual, the Commissioner may employ from time to time insurance actuaries or other technicians who are independently practicing their professions even though similarly employed by insurers and others. This section shall not be deemed to prohibit employment by the Commissioner of retired or pensioned personnel of insurers or insurance organizations.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 218, &sect; 305.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36305.1. Delinquency proceedings; appointment of personnel; exemptions.&nbsp;</span></p> <p><span class="cls0">In any proceeding commenced against an insurer pursuant to Article 18 or 19 of Title 36 of the Oklahoma Statutes for the purpose of liquidating, rehabilitating, reorganizing or conserving such insurer:&nbsp;</span></p> <p><span class="cls0">1. No former employee of the Insurance Department shall be employed or appointed to serve in any capacity by the court to assist the Insurance Department for a period of one (1) year following such employee's former employment;&nbsp;</span></p> <p><span class="cls0">2. No former member of the State Legislature shall be employed to assist the Insurance Department for a period of two (2) years following the expiration of such member's service in office; and&nbsp;</span></p> <p><span class="cls0">3. If any former officer or employee of any other company has been employed to assist the Insurance Department with the said proceeding against the insurer, such other company may not purchase the assets of or acquire any other interest in said insurer for a period of one (1) year following the expiration or termination of such officer's or employee's term of office or employment.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Amended by Laws 1987, c. 210, &sect; 3, eff. July 1, 1987. &nbsp;</span></p> <p><span class="cls0">&sect;36-306. Records - Disclosure.&nbsp;</span></p> <p><span class="cls0">A. The records, books, and papers pertaining to the official transactions, filings, examinations, investigations, and proceedings of the Insurance Department shall be maintained by the Department until disposition thereof has been approved by the Archives and Records Commission. These records, books, and papers shall be public records of the state. However, reports of examinations of insurers shall be filed and made public only as provided in Section 309.4 of this title. Open and ongoing investigative and disciplinary files shall not be made public until their completion or unless they are ordered to be made public by the proper judicial official. Files of the claims division of the office of the Commissioner, including but not limited to complaints and requests for assistance from insureds, and insurance agency and company records, shall not be public records and shall not be disclosed except in connection with disciplinary proceedings by the Commissioner. Final market conduct orders shall be open public records.&nbsp;</span></p> <p><span class="cls0">B. Any document or other information generated by the Insurance Department or received by the Insurance Department from a governmental agency or any other public body of any kind, including an insurance guaranty fund or risk pool board, that has a protection from disclosure under any statute or evidentiary privilege from disclosure, while in the possession of the body that generated or received the information, shall retain its confidential character while in the possession of the Insurance Department. The Insurance Department may require that any agency or public body providing a document or other information, if it expects the information to be treated confidentially by the Insurance Department, to also provide simultaneously an express reference to the claimed protection from disclosure.&nbsp;</span></p> <p><span class="cls0">C. A court shall quash any subpoena commanding the disclosure of confidential information or closed records of the Insurance Department absent a showing of justification for the disclosure.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 219, &sect; 306, operative July 1, 1957. Amended by Laws 1980, c. 322, &sect; 3, eff. Jan. 1, 1981; Laws 1983, c. 68, &sect; 3, eff. Nov. 1, 1983; Laws 1985, c. 328, &sect; 1, emerg. eff. July 29, 1985; Laws 1997, c. 418, &sect; 5, eff. Nov. 1, 1997; Laws 2010, c. 222, &sect; 2, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-306.1. Availability of data necessary for review &ndash; Confidentiality &ndash; Sharing of data - Definitions.&nbsp;</span></p> <p><span class="cls0">A. A supervisory agency shall make available to a requesting agency any data obtained or generated by, and in the possession of, the supervisory agency and that the requesting agency deems necessary for review in connection with the supervision of any person over which the requesting agency has direct supervisory authority. However, the requested data must relate to the person, or an affiliate of the person, over which the requesting agency has direct supervisory authority. An agency has direct supervisory authority over a person if such authority is specifically provided by statute, or the agency granted the person&rsquo;s charter, license, or registration, or otherwise granted permission for the person to conduct its business in this state.&nbsp;</span></p> <p><span class="cls0">B. When a requesting agency and a federal regulatory agency or self-regulatory association have concurrent jurisdiction over a person, a requesting agency may share with such agency or association data received from a supervisory agency. However, the federal regulatory agency or self-regulatory association must return such shared data to the requesting agency unless the federal regulatory agency or self-regulatory association has obtained approval from the supervisory agency to retain the data. The term &ldquo;federal regulatory agency&rdquo; shall not include law enforcement agencies.&nbsp;</span></p> <p><span class="cls0">C. 1. Notwithstanding any other statute, rule, or policy governing or relating to records of the requesting agency, all data received by a requesting agency from a supervisory agency shall be and remain confidential and not open to public inspection, subpoena, or any other form of disclosure while in the possession of the requesting agency. Any request for inspection, subpoena, or other form of disclosure must be directed at the supervisory agency from which the data originated and disclosure thereof shall be subject to the laws, rules, and policies governing or relating to records of the supervisory agency.&nbsp;</span></p> <p><span class="cls0">2. The provisions of data by a supervisory agency to a requesting agency under this section shall not constitute a waiver of, or otherwise affect, any privilege or claim of confidentiality that a supervisory agency may claim with respect to such data under any federal laws or laws of this state.&nbsp;</span></p> <p><span class="cls0">D. A supervisory agency is not required to share original documents with a requesting agency. A requesting agency shall reimburse the supervisory agency for costs associated with providing copies of data to the requesting agency.&nbsp;</span></p> <p><span class="cls0">E. Nothing in the Oklahoma Financial Privacy Act, Sections 2201 through 2206 of Title 6 of the Oklahoma Statutes, shall prohibit the sharing of data as described in this section. Additionally, neither a supervisory agency nor requesting agency shall be required to follow any procedure described in the Oklahoma Financial Privacy Act when sharing data as described in this section.&nbsp;</span></p> <p><span class="cls0">F. As used in this section:&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Affiliate&rdquo; shall mean any person that controls, is controlled by, or is under common control with another person. A person shall be deemed to have &ldquo;control&rdquo; over any person if the person:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;directly or indirectly or acting through one or more other persons owns, controls, or has power to vote ten percent (10%) or more of any class of voting securities of the other person, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the person controls in any manner the election, appointment, or designation of a majority of the directors, trustees, or other managing officers of the person;&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Data&rdquo; shall mean copies of any documents, reports, examination reports, letters, correspondence, orders, stipulations, memorandums of understanding, agreements, or any other records not open for public inspection generated by a supervisory agency or obtained by a supervisory agency from the person it supervises, whether in paper or electronic format. However, &ldquo;data&rdquo; shall not include records that a requesting agency receives from a supervisory agency pursuant to this section;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Requesting agency&rdquo; shall mean, as applicable, the Oklahoma State Banking Department, the Oklahoma Insurance Department, or the Oklahoma Department of Securities, that requests from a supervisory agency data relating to a person over which the requesting agency does not have direct supervisory authority;&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Supervision&rdquo; shall mean any examination, assessment, order, stipulation, agreement, report, memorandum of understanding, or other regulatory matter or process that a requesting agency is authorized to perform in relation to a person; and&nbsp;</span></p> <p><span class="cls0">5. &ldquo;Supervisory agency&rdquo; shall mean, as applicable, the Oklahoma State Banking Department, the Oklahoma Insurance Department, or the Oklahoma Department of Securities, that maintains data relating to a person over which the agency has direct supervisory authority.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2000, c. 205, &sect; 32, emerg. eff. May 17, 2000.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-307. Duties of Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner shall be charged with the duty of administration and enforcement of the provisions of the Oklahoma Insurance Code and of any requirements placed on an insurance company pursuant to subsection L of section 1111 of Title 47 of the Oklahoma Statutes. The Insurance Commissioner shall have jurisdiction over complaints against all persons engaged in the business of insurance, and shall hear all matters either in person, by authorized disinterested employees, or by hearing examiners appointed by the Commissioner for that purpose. It shall be the duty of the Insurance Commissioner to file and safely keep all books and papers required by law to be filed with the Insurance Department, and to keep and preserve in permanent form a full record of proceedings, including a concise statement of the conditions of such insurers and other entities reported and examined by the Department and its examiners. The Commissioner shall, annually, at the earliest practicable date after returns are received from the several authorized insurers and other organizations, make a report to the Governor of the State of Oklahoma of the affairs of the Office of the Insurance Commissioner, which report shall contain a tabular statement and synopsis of the several statements, as accepted by the Insurance Commissioner, which shall include with respect to each insurance company the admitted assets, liabilities except capital, capital and surplus, Oklahoma premium income, amount of claims paid in Oklahoma, and such other matters as may be of benefit to the public. The Commissioner may educate consumers and make recommendations regarding the subject of insurance in this state, and shall set forth in a statement the various sums received and disbursed by the Department, from and to whom and for what purpose. Such report shall be published by and subject to the order of the said Insurance Commissioner. The Insurance Commissioner shall, upon retiring from office, deliver to the qualified successor all furniture, records, papers and property of the office.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 219, &sect; 307, operative July 1, 1957. Amended by Laws 1965, c. 60, &sect; 3, eff. July 1, 1965; Laws 1972, c. 162, &sect; 1, emerg. eff. April 7, 1972; Laws 1980, c. 322, &sect; 4, eff. Jan. 1, 1981; Laws 1986, c. 207, &sect; 77, operative July 1, 1986; Laws 1987, c. 210, &sect; 4, eff. July 1, 1987; Laws 1997, c. 418, &sect; 6, eff. Nov. 1, 1997; Laws 2005, c. 355, &sect; 3, eff. Nov. 1, 2005; Laws 2006, c. 264, &sect; 4, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36307.1. Rules and regulations.&nbsp;</span></p> <p><span class="cls0">The Commissioner may adopt reasonable rules and regulations for the implementation and administration of the provisions of the Insurance Code.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1983, c. 89, &sect; 14, eff. Nov. 1, 1983. &nbsp;</span></p> <p><span class="cls0">&sect;36-307.2. Nonpublic personal information.&nbsp;</span></p> <p><span class="cls0">A. No person shall disclose any nonpublic personal information contrary to the provisions of Title V of the Gramm-Leach-Bliley Act of 1999, Public Law No. 106-102.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner may promulgate rules necessary to carry out the provisions of this section.&nbsp;</span></p> <p><span class="cls0">C. Nothing in this section shall be construed to create a private cause of action.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 363, &sect; 1, eff. July 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-307.3. State Insurance Commissioner Revolving Fund.&nbsp;</span></p> <p><span class="cls0">A. Effective July 1, 2009, there is hereby created in the State Treasury a revolving fund for the Insurance Commissioner called the State Insurance Commissioner Revolving Fund. The revolving fund shall be used to fund the operations of the Office of the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">1. Notwithstanding any other law to the contrary, the revolving fund shall consist of and consolidate all funds that are or have been paid or collected by the Insurance Commissioner pursuant to the laws of this state and the rules of the Insurance Department except that the revolving fund shall not include:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;premium taxes,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;monies transferred to the Attorney General's Insurance Fraud Unit Revolving Fund pursuant to Section 362 of this title,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;funds paid to and collected pursuant to the Oklahoma Certified Real Estate Appraisers Act, Sections 858-700 through 858-732 of Title 59 of the Oklahoma Statutes,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;health carrier access payments paid to and collected by the Insurance Commissioner and deposited into the Health Carrier Access Payment Revolving Fund, and&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;recoveries obtained as a result of insurance-related crimes, and other fines, late fees, and penalties assessed and collected.&nbsp;</span></p> <p><span class="cls0">2. The revolving fund shall be a continuing fund, not subject to fiscal year limitations. Expenditures from the revolving fund shall be made pursuant to the laws of this state and the statutes relating to the Insurance Department. Warrants for expenditures from the revolving fund shall be drawn by the State Treasurer, based on claims signed by an authorized employee or employees of the Insurance Department and filed with the Director of the Office of Management and Enterprise Services.&nbsp;</span></p> <p><span class="cls0">B. All funds collected by the Insurance Commissioner shall be paid into the State Treasury weekly.&nbsp;</span></p> <p><span class="cls0">C. After the effective date of this act, the State Treasury is authorized and directed to deduct from the funds paid or collected by the Insurance Commissioner a sum equal to seventy-six and one- half percent (76.5%) of the payment and place the same to the credit of the General Revenue Fund of the state. The State Treasurer shall place to the credit of the State Insurance Commissioner Revolving Fund the remainder of the funds so paid and collected by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 432, &sect; 1, eff. July 1, 2009. Amended by Laws 2010, c. 222, &sect; 3, eff. Nov. 1, 2010; Laws 2010, c. 300, &sect; 5; Laws 2011, c. 360, &sect; 1; Laws 2012, c. 304, &sect; 122.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-307.4. Use of grant - Audited annually.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may solicit, accept and authorize the use of any grant made to the Insurance Department as long as the terms of the grant are carried out and the Insurance Commissioner holds the funds in trust for the purposes of carrying out the terms of the grant.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner must annually account to the State Auditor and Inspector for all monies or property received or extended by virtue of this section. The account shall state:&nbsp;</span></p> <p><span class="cls0">1. The source of the monies or property received with the actual date of its receipt;&nbsp;</span></p> <p><span class="cls0">2. The particular use or place for which it was expended; and&nbsp;</span></p> <p><span class="cls0">3. The balance on hand showing the place of deposit of the unexpended balance.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 294, &sect; 10, eff. July 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-307.5. Insurance Department Anti-Fraud Revolving Fund.&nbsp;</span></p> <p><span class="cls0">A. There is hereby created in the State Treasury a revolving fund for the Oklahoma Insurance Department, to be designated the "Insurance Department Anti-Fraud Revolving Fund". The fund shall be a continuing fund, not subject to fiscal year limitation, and shall consist of any monies designated to the fund as provided in subsections B and C of this section. Warrants for expenditures from the revolving fund shall be drawn by the State Treasurer, based on claims signed by an authorized employee or employees of the Insurance Department and filed with the Director of the Office of Management and Enterprise Services. The fund shall be used for the purpose of administering investigations of abuse, negligence or criminal conduct regarding insurance laws or regulations.&nbsp;</span></p> <p><span class="cls0">B. The Department shall deposit all of the monies obtained as a result of insurance-related crimes, and other fines, late fees, and penalties assessed and collected into the Insurance Department Anti-Fraud Revolving Fund.&nbsp;</span></p> <p><span class="cls0">C. Each year, the Department shall transfer to the General Revenue Fund the first Four Hundred Eighty-two Thousand Five Hundred Dollars ($482,500.00) collected by the Department and deposited in the Insurance Department Anti-Fraud Revolving Fund. The next Five Hundred Thousand Dollars ($500,000.00) collected by the Department each year shall be divided evenly between the Department and the Oklahoma Attorney General. All collections to be submitted to the Attorney General shall be deposited in the Attorney General's Insurance Fraud Unit Revolving Fund. Any collections above Nine Hundred Eighty-two Thousand Five Hundred Dollars ($982,500.00) shall be deposited each year into the Insurance Department Anti-Fraud Revolving Fund and shall be retained for use by the Department for the purposes of administering investigations of abuse, negligence or criminal conduct regarding insurance laws or regulations.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2011, c. 360, &sect; 2. Amended by Laws 2012, c. 304, &sect; 123.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-308. Repealed by Laws 1991, c. 204, &sect; 14, eff. Sept. 1, 1991.&nbsp;</span></p> <p><span class="cls0">&sect;36-309. Repealed by Laws 1991, c. 204, &sect; 14, eff. Sept. 1, 1991.&nbsp;</span></p> <p><span class="cls0">&sect;36-309.1. Examinations - Definitions.&nbsp;</span></p> <p><span class="cls0">As used in Sections 309.1 through 309.7 of this title:&nbsp;</span></p> <p><span class="cls0">1. "Commissioner" means the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">2. "Company" means any person engaging in or proposing or attempting to engage in any transaction or kind of insurance or surety business and any person or group of persons who may otherwise be subject to the administrative or regulatory authority of the Commissioner;&nbsp;</span></p> <p><span class="cls0">3. "Department" means the Insurance Department;&nbsp;</span></p> <p><span class="cls0">4. "Examiner" means any individual or firm having been authorized by the Commissioner to conduct an examination;&nbsp;</span></p> <p><span class="cls0">5. "Insurer" means every person engaged in the business of making contracts of insurance or indemnity including not-for-profit hospital service and medical indemnity corporations; and&nbsp;</span></p> <p><span class="cls0">6. "Person" means any individual, aggregation of individuals, trust, association, recognized legal entity, or any affiliate thereof.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 204, &sect; 1, eff. Sept. 1, 1991. Amended by Laws 1997, c. 418, &sect; 7, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-309.2. Nature and frequency of examinations - Reports in lieu of examinations.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner or an examiner may conduct an examination, including a financial and market conduct examination, under Sections 309.1 through 309.7 of this title of any company as often as the Commissioner deems appropriate but shall at a minimum, conduct a financial examination of every domestic insurer licensed in this state not less frequently than once every five (5) years. The Commissioner shall, at a minimum, conduct or cause to be conducted a financial examination of every foreign insurer licensed in this state not less frequently than once every five (5) years. The Commissioner may accept examinations conducted by other states on foreign insurers domiciled in such states pursuant to subsection D of this section. In scheduling and determining the nature, scope and frequency of the examinations, the Commissioner shall consider such matters as the results of financial statement analyses and ratios, changes in management or ownership, actuarial opinions, reports of independent certified financial examiners or public accountants and other criteria as set forth in the Examiners' Handbook adopted by the National Association of Insurance Commissioners and in effect when the Commissioner exercises discretion under this subsection. The Commissioner may also make examinations upon the request of one or more persons pecuniarily interested therein, who shall make affidavit of their belief, with specifications of their reasons therefor, that the company is in an unsound condition.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner may adopt rules setting forth criteria and informing domestic insurers of those factors which may contribute to the Commissioner requiring the financial examination of an insurer prior to the end of the five-year-examination requirement provided in subsection A of this section.&nbsp;</span></p> <p><span class="cls0">C. For purposes of completing an examination of any company under Sections 309.1 through 309.7 of this title, the Commissioner may examine or investigate any person, or the business of any person, insofar as such examination or investigation is, in the sole discretion of the Commissioner, necessary or material to the examination of the company.&nbsp;</span></p> <p><span class="cls0">D. In lieu of an examination under Sections 309.1 through 309.7 of this title of any foreign or alien insurer licensed in this state, the Commissioner may accept an examination report on such company as prepared by the insurance department for the company's state of domicile or port-of-entry state if:&nbsp;</span></p> <p><span class="cls0">1. The insurance department was at the time of the examination accredited under the National Association of Insurance Commissioners' Financial Regulation Standards and Accreditation Program; or&nbsp;</span></p> <p><span class="cls0">2. The examination is performed with the participation of one or more examiners who are employed by an accredited state insurance department and who, after a review of the examination work papers and report, state under oath that the examination was performed in a manner consistent with the standards and procedures required by their insurance department.&nbsp;</span></p> <p><span class="cls0">E. The Commissioner may authorize any employee of the Insurance Department to exercise the Commissioner's authority under Sections 309.1 through 309.7 of this title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 204, &sect; 2, eff. Sept. 1, 1991. Amended by Laws 1993, c. 79, &sect; 1, eff. Sept. 1, 1993; Laws 1997, c. 418, &sect; 8, eff. Nov. 1, 1997; Laws 2009, c. 176, &sect; 1, eff. Nov. 1, 2009; Laws 2012, c. 154, &sect; 1, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-309.3. Appointment of examiner - Compliance with examiner's requests - Powers of Commissioner.&nbsp;</span></p> <p><span class="cls0">A. Upon determining that an examination should be conducted, the Insurance Commissioner shall issue an examination warrant appointing one or more examiners to perform the examination and instructing them as to the scope of the examination. In conducting the examination, the examiner shall observe those guidelines and procedures set forth in the Examiners' Handbook adopted by the National Association of Insurance Commissioners as supplemented by rules of the Commissioner. The Commissioner may also employ such other guidelines or procedures as the Commissioner may deem appropriate.&nbsp;</span></p> <p><span class="cls0">B. Every company or person from whom information is sought, including all of its officers, directors, employees and agents, shall provide to the Commissioner and examiners timely, convenient, and free access at all reasonable hours at its offices to all books, records, accounts, papers, documents, and any or all computer or other recordings relating to the property, assets, business and affairs of the company being examined. The officers, directors, employees and agents of the company or person shall facilitate such examination and aid in such examination so far as it is in their power to do so. The refusal of any company, by its officers, directors, employees or agents, to submit to examination or to comply with any reasonable written request of the examiners shall be grounds for suspension or refusal of, or nonrenewal of any license or authority held by the company to engage in an insurance or other business subject to the Commissioner's jurisdiction. Any such proceedings for suspension, revocation or refusal of any license or authority shall be conducted pursuant to Section 619 of this title.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner or examiners shall have the power to issue subpoenas, to administer oaths and to examine under oath any person as to any matter pertinent to the examination. Upon the failure or refusal of any person to obey a subpoena, the Commissioner may petition a court of competent jurisdiction, and upon proper showing, the Court may enter any order compelling the witness to appear and testify or produce documentary evidence. Failure to obey the court order shall be punishable as contempt of court.&nbsp;</span></p> <p><span class="cls0">D. When making an examination under Sections 309.1 through 309.7 of this title, the Commissioner may retain attorneys, appraisers, independent actuaries, independent certified public accountants or an accounting firm or individual holding a permit to practice public accounting, certified financial examiners or other professionals and specialists as examiners, the cost of which shall be borne by the company which is the subject of the examination.&nbsp;</span></p> <p><span class="cls0">E. Nothing contained in Sections 309.1 through 309.7 of this title shall be construed to limit the Commissioner's authority to terminate or suspend any examination in order to pursue other legal or regulatory action pursuant to the insurance laws of this state. Findings of fact and conclusions made in any examination report shall be prima facie evidence in any legal or regulatory action.&nbsp;</span></p> <p><span class="cls0">F. Nothing contained in Sections 309.1 through 309.7 of this title shall be construed to limit the Commissioner's authority to use and, if appropriate, to make public any final or preliminary examination report, any examiner or company workpapers or other documents, or any other information discovered or developed during the course of any examination in the furtherance of any legal or regulatory action which the Commissioner may deem appropriate.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 204, &sect; 3, eff. Sept. 1, 1991. Amended by Laws 1997, c. 418, &sect; 9, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-309.4. Report of examination - Review by Commissioner - Investigatory hearing - Disclosure.&nbsp;</span></p> <p><span class="cls0">A. All examination reports shall be comprised of only facts appearing upon the books, records, or other documents of the company, its agents or other persons examined, or as ascertained from the testimony of its officers or agents or other persons examined concerning its affairs, and such conclusions and recommendations as the examiners find reasonably warranted from such facts.&nbsp;</span></p> <p><span class="cls0">B. No later than thirty (30) days following completion of the examination, the examiner in charge shall file with the Insurance Department a verified written report of examination under oath. Upon receipt of the verified report, the Department shall transmit the report to the company examined, together with a notice which shall afford such company examined a reasonable opportunity of not more than twenty (20) days to make a written submission or written rebuttal with respect to any matters contained in the examination report.&nbsp;</span></p> <p><span class="cls0">C. Within twenty (20) days of the end of the period allowed for the receipt of written submissions or written rebuttals, the Insurance Commissioner shall fully consider and review the report, together with any written submissions or written rebuttals and any relevant portions of the examiners' work papers and enter an order:&nbsp;</span></p> <p><span class="cls0">1. Adopting the examination report as filed or with modification or corrections. If the examination report reveals that the company is operating in violation of any law, regulation or prior order of the Commissioner, the Commissioner may order the company to take any action the Commissioner considers necessary and appropriate to cure such violation;&nbsp;</span></p> <p><span class="cls0">2. Rejecting the examination report with directions to the examiners to reopen the examination for purposes of obtaining additional data, documentation or information, and refiling pursuant to subsection A of this section; or&nbsp;</span></p> <p><span class="cls0">3. Calling for an investigatory hearing with notice pursuant to the Administrative Procedures Act to the company for purposes of obtaining additional documentation, data, information and testimony.&nbsp;</span></p> <p><span class="cls0">D. 1. All orders entered pursuant to paragraph 1 of subsection C of this section shall be accompanied by findings and conclusions resulting from the Commissioner's consideration and review of the examination report, relevant examiner work papers and any written submissions or rebuttals. Any such order shall be considered a final administrative decision and may be appealed pursuant to the Administrative Procedures Act, and shall be served upon the company by certified mail, together with a copy of the adopted examination report. Within thirty (30) days of the issuance of the adopted report, the company shall file affidavits executed by each of its directors stating under oath that they have received a copy of the adopted report and related orders. Upon proper order of the Commissioner, the company shall deliver by mail or otherwise, within thirty (30) days of the date of the order, a copy of the adopted report and related orders to all states and jurisdictions in which the company is licensed to transact the business of insurance.&nbsp;</span></p> <p><span class="cls0">2. Any hearing conducted pursuant to paragraph 3 of subsection C of this section by the Commissioner or authorized representative, shall be conducted as a nonadversarial confidential investigatory proceeding as necessary for the resolution of any inconsistencies, discrepancies or disputed issues apparent upon the face of the filed examination report or raised by or as a result of the Commissioner's review of relevant work papers or by the written submission or rebuttal of the company. Within thirty (30) days of the conclusion of any such hearing, the Commissioner shall enter an order pursuant to paragraph 1 of subsection C of this section.&nbsp;</span></p> <p><span class="cls0">3. The Commissioner shall not appoint an examiner as an authorized representative to conduct the hearing. The Commissioner or a representative of the Commissioner may issue subpoenas for the attendance of any witnesses or the production of any documents deemed relevant to the investigation whether under the control of the Department, the company or other persons. The documents produced shall be included in the record, and testimony taken by the Commissioner or representative of the Commissioner shall be under oath and preserved for the record.&nbsp;</span></p> <p><span class="cls0">4. Nothing contained in this section shall require the Department to disclose any information or records which would indicate or show the existence or content of any investigation or activity of a criminal justice agency.&nbsp;</span></p> <p><span class="cls0">5. The hearing shall proceed with the Commissioner or a representative of the Commissioner posing questions to the persons subpoenaed. Thereafter the company and the Department may present testimony relevant to the investigation. The company and the Department shall be permitted to make closing statements and may be represented by counsel of their choice.&nbsp;</span></p> <p><span class="cls0">E. 1. Upon the adoption of the examination report under paragraph 1 of subsection C of this section, the Commissioner shall continue to hold the content of the examination report as private and confidential information for a period of two (2) days except to the extent provided in subsection B of this section and subsection F of Section 309.3 of this title. Thereafter, the Commissioner may open the report for public inspection so long as no court of competent jurisdiction has stayed its publication.&nbsp;</span></p> <p><span class="cls0">2. Nothing contained in Sections 309.1 through 309.7 of this title shall prevent or be construed as prohibiting the Commissioner from disclosing the content of an examination report, preliminary examination report or results, or any matter relating thereto, to the insurance department of this or any other state or country, or to law enforcement officials of this or any other state or agency of the federal government at any time, so long as such agency or office receiving the report or matters relating thereto agrees in writing to hold it confidential and in a manner consistent with Sections 309.1 through 309.7 of this title.&nbsp;</span></p> <p><span class="cls0">3. In the event the Commissioner determines that regulatory action is appropriate as a result of any examination, the Commissioner may initiate any proceedings or actions as provided by law.&nbsp;</span></p> <p><span class="cls0">F. All working papers, recorded information, documents and copies thereof produced by, obtained by or disclosed to the Commissioner or any other person in the course of an examination made under Sections 309.1 through 309.7 of this title, or in the course of analysis by the Commissioner or any other person of the financial condition or market conduct of a company, shall be given confidential treatment and are not subject to subpoena and may not be made public by the Commissioner or any other person, except to the extent provided in subsection E of this section and subsection F of Section 309.3 of this title. Access may also be granted to the National Association of Insurance Commissioners. Such parties shall agree in writing prior to receiving the information to provide to it the same confidential treatment as required by this section, unless the prior written consent of the company to which it pertains has been obtained.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 204, &sect; 4, eff. Sept. 1, 1991. Amended by Laws 2001, c. 363, &sect; 2, eff. July 1, 2001; Laws 2010, c. 356, &sect; 1, eff. Nov. 1, 2010.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-309.5. Examiner's conflict of interest.&nbsp;</span></p> <p><span class="cls0">A. No examiner may be appointed by the Insurance Commissioner if such examiner, either directly or indirectly, has a conflict of interest or is affiliated with the management of or owns a pecuniary interest in any person subject to examination under Sections 309.1 through 309.7 of this title. This section shall not be construed to automatically preclude an examiner from being:&nbsp;</span></p> <p><span class="cls0">1. A policyholder or claimant under an insurance policy;&nbsp;</span></p> <p><span class="cls0">2. A grantor of a mortgage or similar instrument on such examiner's residence to a regulated entity if done under customary terms and in the ordinary course of business;&nbsp;</span></p> <p><span class="cls0">3. An investment owner in shares of regulated diversified investment companies; or&nbsp;</span></p> <p><span class="cls0">4. A settlor or beneficiary of a blind trust into which any otherwise impermissible holdings have been placed.&nbsp;</span></p> <p><span class="cls0">B. Notwithstanding the requirements of this section, the Commissioner may retain from time to time, on an individual basis, qualified actuaries, an accounting firm or individual holding a permit to practice public accounting in this state, or other similar individuals who are independently practicing their professions, even though said persons may from time to time be similarly employed or retained by persons subject to examination under this act. An examiner shall disclose to the Commissioner in writing any prior or existing personal or business relationship with any company to be examined by that examiner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 204, &sect; 5, eff. Sept. 1, 1991. Amended by Laws 1997, c. 418, &sect; 10, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-309.6. Payment of charges.&nbsp;</span></p> <p><span class="cls0">Any insurer or person examined under the provisions of Sections 309.1 through 309.7 of this title shall pay the proper charges incurred in such examination, including the actual expense of the Insurance Commissioner or the expenses and compensation of an authorized representative and the expense and compensation of assistants and examiners employed therein. All expenses incurred in such examination shall be verified by affidavit and a copy shall be filed in the office of the Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 204, &sect; 6, eff. Sept. 1, 1991. Amended by Laws 1997, c. 418, &sect; 11, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-309.7. Liability.&nbsp;</span></p> <p><span class="cls0">A. No cause of action shall arise nor shall any liability be imposed against the Insurance Commissioner, the Commissioner's authorized representatives, or any examiner appointed by the Commissioner for any statements made or conduct performed while carrying out the provisions of Sections 309.1 through 309.7 of this title, unless the conduct was objectively unreasonable and outside the scope of the person's duties.&nbsp;</span></p> <p><span class="cls0">B. No cause of action shall arise, nor shall any liability be imposed against any person for the act of communicating or delivering information or data to the Commissioner or the Commissioner's authorized representative or examiner pursuant to an examination made under Sections 309.1 through 309.7 of this title, if such act of communication or delivery was not a fraudulent or criminal act.&nbsp;</span></p> <p><span class="cls0">C. This section does not abrogate or modify in any way any common law or statutory privilege or immunity heretofore enjoyed by any person identified in subsection A of this section.&nbsp;</span></p> <p><span class="cls0">D. A person identified in subsection A of this section shall be entitled to an award of attorney's fees and costs if determined to be the prevailing party in a civil action arising out of activities in carrying out the provisions of Sections 309.1 through 309.7 of this title, if the court determines that the party bringing the action was not substantially justified in doing so. For purposes of this section, a proceeding is substantially justified if it had a reasonable basis in law or fact at the time that it was initiated.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 204, &sect; 7, eff. Sept. 1, 1991. Amended by Laws 1997, c. 418, &sect; 12, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-310. Repealed by Laws 1991, c. 204, &sect; 14, eff. Sept. 1, 1991.&nbsp;</span></p> <p><span class="cls0">&sect;36-310.1. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-310.2. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-310A.1. Reporting of material acquisitions and disposition of assets or material nonrenewals, cancellations or revisions of ceded reinsurance agreements.&nbsp;</span></p> <p><span class="cls0">A. Every insurer domiciled in this state shall file a report with the Insurance Commissioner disclosing material acquisitions and dispositions of assets or material nonrenewals, cancellations or revisions of ceded reinsurance agreements unless the acquisitions and dispositions of assets or material nonrenewals, cancellations or revisions of ceded reinsurance agreements have been submitted to the Commissioner for review, approval or information purposes pursuant to other provisions of the Oklahoma Insurance Code.&nbsp;</span></p> <p><span class="cls0">B. The report required in subsection A of this section is due within fifteen (15) days after the end of the calendar month in which any of the foregoing transactions occur.&nbsp;</span></p> <p><span class="cls0">C. One complete copy of the report, including any exhibits or other attachments, shall be filed with the National Association of Insurance Commissioners.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 273, &sect; 1, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-310A.2. Material acquisitions or dispositions defined - Information to be disclosed in report.&nbsp;</span></p> <p><span class="cls0">A. No acquisitions or dispositions of assets need be reported pursuant to Section 1 of this act if the acquisitions or dispositions are not material. For purposes of this act, a material acquisition, or the aggregate of any series of related acquisitions during any thirty-day period, or disposition, or the aggregate of any series of related dispositions during any thirty-day period, is one that is nonrecurring and not in the ordinary course of business and involves more than five percent (5%) of the reporting insurer's total admitted assets as reported in its most recent annual statement filed with the Insurance Commissioner pursuant to Section 311 of Title 36 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">B. 1. Asset acquisitions subject to Section 1 of this act include every purchase, lease, exchange, merger, consolidation, succession or any other acquisition.&nbsp;</span></p> <p><span class="cls0">2. Asset dispositions subject to this act include every sale, lease, exchange, merger, consolidation, mortgage, hypothecation, assignment whether for the benefit of creditors or otherwise, abandonment, destruction or other disposition.&nbsp;</span></p> <p><span class="cls0">C. 1. The following information is required to be disclosed in any report of a material acquisition or disposition of assets:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;date of the transaction,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;manner of acquisition or disposition,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;description of the assets involved,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;nature and amount of the consideration given or received,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;purpose of, or reason for, the transaction,&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;manner by which the amount of consideration was determined, and&nbsp;</span></p> <p class="cls2"><span class="cls0">g.&nbsp;&nbsp;gain or loss recognized or realized as a result of the transaction.&nbsp;</span></p> <p><span class="cls0">2. Insurers are required to report material acquisitions and dispositions on a nonconsolidated basis unless the insurer is part of a consolidated group of insurers which utilizes a pooling arrangement or one hundred percent (100%) reinsurance agreement that affects the solvency and integrity of the insurer's reserves and the insurer ceded substantially all of its direct and assumed business to the pool. An insurer is deemed to have ceded substantially all of its direct and assumed business to a pool if:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the insurer has less than One Million Dollars ($1,000,000.00) total direct plus assumed written premiums during a calendar year that are not subject to a pooling arrangement, and&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the net income of the business not subject to the pooling arrangement represents less than five percent (5%) of the insurer's capital and surplus.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 273, &sect; 2, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-310A.3. Material nonrenewals, cancellations or revisions of ceded reinsurance agreements defined - Information to be disclosed in report.&nbsp;</span></p> <p><span class="cls0">A. 1. No nonrenewals, cancellations or revisions of ceded reinsurance agreements need be reported pursuant to Section 1 of this act if the nonrenewals, cancellations or revisions are not material. For purposes of this act, a material nonrenewal, cancellation or revision is one that affects:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;as respects property and casualty business, including accident and health business written by a property and casualty insurer:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;more than fifty percent (50%) of the insurer's total ceded written premium, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;more than fifty percent (50%) of the insurer's total ceded indemnity and loss adjustment reserves,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;as respects life, annuity, and accident and health business: more than fifty percent (50%) of the total reserve credit taken for business ceded, on an annualized basis, as indicated in the insurer's most recent annual statement, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;as respects either property and casualty or life, annuity, and accident and health business, either of the following events shall constitute a material revision which must be reported:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;an authorized reinsurer representing more than ten percent (10%) of a total cession is replaced by one or more unauthorized reinsurers, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;previously established collateral requirements have been reduced or waived as respects one or more unauthorized reinsurers representing collectively more than ten percent (10%) of a total cession.&nbsp;</span></p> <p><span class="cls0">2. However, no filing shall be required if:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;as respects property and casualty business, including accident and health business written by a property and casualty insurer: the insurer's total ceded written premium represents, on an annualized basis, less than ten percent (10%) of its total written premium for direct and assumed business, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;as respects life, annuity, and accident and health business: the total reserve credit taken for business ceded represents, on an annualized basis, less than ten percent (10%) of the statutory reserve requirement prior to any cession.&nbsp;</span></p> <p><span class="cls0">B. 1. The following information is required to be disclosed in any report of a material nonrenewal, cancellation or revision of ceded reinsurance agreements:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;effective date of the nonrenewal, cancellation or revision,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the description of the transaction with an identification of the initiator thereof,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;purpose of, or reason for, the transaction, and&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;if applicable, the identity of the replacement reinsurers.&nbsp;</span></p> <p><span class="cls0">2. Insurers are required to report all material nonrenewals, cancellations or revisions of ceded reinsurance agreements on a nonconsolidated basis unless the insurer is part of a consolidated group of insurers which utilizes a pooling arrangement or one hundred percent (100%) reinsurance agreement that affects the solvency and integrity of the insurer's reserves and the insurer ceded substantially all of its direct and assumed business to the pool. An insurer is deemed to have ceded substantially all of its direct and assumed business to a pool if:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the insurer has less than One Million Dollars ($1,000,000.00) total direct plus assumed written premiums during a calendar year that are not subject to a pooling arrangement, and&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the net income of the business not subject to the pooling arrangement represents less than five percent (5%) of the insurer's capital and surplus.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 273, &sect; 3, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-311. Annual statement by companies - Annual license or certificate of authority to transact business.&nbsp;</span></p> <p><span class="cls0">A. 1. All insurers authorized to do business under the provisions of this Code shall, annually, on or before the first day of March, file with the National Association of Insurance Commissioners (NAIC), statements which shall exhibit the financial condition of insurers on the thirty-first day of December of the previous year and its business of that year. Annual statements shall be filed electronically as approved by the NAIC, along with applicable fees. Domestic insurers shall file a printed annual financial statement along with all supplement filings in the office of the Insurance Commissioner annually on or before the first day of March.&nbsp;</span></p> <p><span class="cls0">2. Foreign insurers shall file an Affidavit of Filing and Financial Statement Attestation annually on or before the first day of March. The Insurance Commissioner may require foreign insurers to file the annual financial statement in a printed format. Such document required by the Insurance Commissioner shall be due annually on or before the first day of March.&nbsp;</span></p> <p><span class="cls0">3. For good cause shown, the Insurance Commissioner may extend the time within which such statements may be filed. The statements shall be in such general form and context as approved by the National Association of Insurance Commissioners for the kinds of insurance to be reported upon, and as supplemented for additional information required by the Insurance Commissioner by rule. In addition, the statements shall be prepared in accordance with the NAIC annual statement instruction handbooks, including any supplemental filings described in the NAIC annual instruction handbook, and follow the accounting procedures and practices prescribed by the NAIC accounting practices and procedure manuals as supplemented by the Insurance Commissioner by rule. The assets and liabilities shall be computed pursuant to the most conservative method allowed by the laws of this state. Such statements shall be subscribed and sworn to by the president and secretary and other proper officers. The license or certificate of authority to transact the business of insurance in this state shall be renewed unless the Insurance Commissioner finds that the facts do not warrant renewal, and that the insurer has not fully complied with all laws applicable to the insurer. Upon initial licensure, the Commissioner shall issue a license, or certificate of authority, subject to all requirements and conditions of the law, to transact business in this state, specifying in the certificate the particular kind or kinds of insurance it is authorized to transact. The annual statement of an insurer of a foreign country shall embrace only its business and condition in the United States, and shall be subscribed and sworn to by its resident manager or principal representative in charge of its United States business, or other officer duly authorized. Any amendments and addendums to the annual statement subsequently filed with the Commissioner shall also be filed with the National Association of Insurance Commissioners, and the insurer shall pay the applicable filing fees.&nbsp;</span></p> <p><span class="cls0">B. In the absence of actual malice, or gross negligence, members of the National Association of Insurance Commissioners, their duly authorized committees, subcommittees and task forces, their delegates, National Association of Insurance Commissioners' employees, and all others charged with the responsibility of collecting, reviewing, analyzing and disseminating the information developed from the filing of the annual statement shall be acting as agents of the Commissioner under the authority of this section and shall not be subject to civil liability for libel, slander or any other cause of action by virtue of their collection, review and analysis or disseminating of the data and information collected from the filings required under this section.&nbsp;</span></p> <p><span class="cls0">C. All financial analysis ratios and examination synopses pertaining to insurance companies, which are submitted to the Commissioner by the National Association of Insurance Commissioners' Insurance Regulatory Information System, are confidential records which shall not be available for public inspection and shall not be disclosed by the Commissioner except in receivership proceedings.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 220, &sect; 311, operative July 1, 1957. Amended by Laws 1976, c. 23, &sect; 1, emerg. eff. March 15, 1976; Laws 1986, c. 251, &sect; 1, eff. Nov. 1, 1986; Laws 1987, c. 175, &sect; 1, eff. Nov. 1, 1987; Laws 1992, c. 178, &sect; 1, eff. Sept. 1, 1992; Laws 1993, c. 79, &sect; 2, eff. Sept. 1, 1993; Laws 1997, c. 418, &sect; 13, eff. Nov. 1, 1997; Laws 2001, c. 363, &sect; 3, eff. July 1, 2001; Laws 2002, c. 307, &sect; 1, eff. Nov. 1, 2002; Laws 2003, c. 150, &sect; 1, eff. Nov. 1, 2003; Laws 2004, c. 274, &sect; 1, eff. July 1, 2004.&nbsp;</span></p> <p><span class="cls0">&sect;36-311.1. Fraudulent or false statement - Failure to timely file statement - Penalty.&nbsp;</span></p> <p><span class="cls0">A. Any insurer who files with the Insurance Commissioner any statement required by this Code knowing such statement to be fraudulent and materially false, upon conviction, shall be guilty of a felony, for which the punishment shall be a fine of not to exceed Fifty Thousand Dollars ($50,000.00). Any officer, actuary, or employee of such insurer who causes such statement to be filed, knowing the fraudulent and materially false nature thereof, upon conviction, shall be guilty of a felony, for which the punishment for each occurrence shall be a fine of not to exceed Twenty-five Thousand Dollars ($25,000.00), or commitment to the custody of the Department of Corrections for not less than one (1) year and not more than five (5) years or both said fine and commitment, and shall never again be permitted to act as an actuary, officer, or director of any insurer licensed to do business in this state.&nbsp;</span></p> <p><span class="cls0">B. Any insurer who fails without reasonable cause and permission of the Commissioner to timely file any statement required by this Code shall be subject, after notice and opportunity for hearing, to censure, suspension or revocation of certificate. Annual statements filed after the first day of March without express written advance permission of the Commissioner shall be accompanied by a late filing fee in the amount of Two Hundred Fifty Dollars ($250.00) or One Hundred Dollars ($100.00) per day, whichever is greater. Repeated willful violations, after notice and opportunity for hearing, may subject the insurer to both censure, suspension, or revocation of certificate and civil penalty of not less than One Hundred Dollars ($100.00) nor more than Ten Thousand Dollars ($10,000.00) for each occurrence in addition to the late filing fee.&nbsp;</span></p> <p><span class="cls4">C.&nbsp;&nbsp;<span class="cls5"> Prosecution or administrative action for any violation of the provisions of this section shall be commenced within four (4) years after the violation is discovered.&nbsp;</span></span></p> <p><span class="cls0">Added by Laws 1957, p. 221, &sect; 311.1, operative July 1, 1957. Amended by Laws 1983, c. 68, &sect; 4, eff. Nov. 1, 1983; Laws 1985, c. 328, &sect; 2, emerg. eff. July 29, 1985; Laws 1986, c. 251, &sect; 2, emerg. eff. June 13, 1986; Laws 1993, c. 270, &sect; 36, eff. Sept. 1, 1993; Laws 1997, c. 418, &sect; 14, eff. Nov. 1, 1997; Laws 2009, c. 432, &sect; 2, eff. July 1, 2009.&nbsp;</span></p> <p><span class="cls0">NOTE: Laws 1997, c. 133, &sect; 444 repealed by Laws 1999, 1st Ex. Sess., c. 5, &sect; 452, eff. July 1, 1999.&nbsp;</span></p> <p><span class="cls0">NOTE: Laws 1998, 1st Ex. Sess., c. 2, &sect; 23 amended the effective date of Laws 1997, c. 133, &sect; 444 from July 1, 1998, to July 1, 1999.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36311.2. Reports on financial condition.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may request financial information more frequently than quarterly if it appears an insurer is having financial difficulty, if erratic changes are occurring in the financial data of the company, if a considerable number of consumer complaints have been received, or if one or more transactions have occurred which appear to jeopardize the welfare of the policyholders. The insurer also may be requested to furnish a plan of action to improve its underwriting performance.&nbsp;</span></p> <p><span class="cls0">B. Any insurer upon request of the Commissioner shall furnish to the Insurance Commissioner within fortyfive (45) days following the close of any calendar quarter, except the fourth quarter, on blank forms prescribed by the Insurance Commissioner, a statement which shall exhibit the financial condition of the company as of the last date of the month immediately preceding reporting date. Such reports for information purposes shall contain a complete listing of all written commitments to loan, guaranties of loans, or contractual obligations concerning loans or conditional liabilities to borrowers or lenders made during the quarter reported. Such reports may require the inclusion of an exhibit of the operating results of the company for the three (3) months' period immediately preceding the date for which the financial condition is shown. A completed blank form prescribed by the Commissioner for said statement shall be furnished by each insurer for each such reporting date. Such statements shall be subscribed and sworn to by the president and the secretary and other proper officers of the company. Failure of any insurer to execute and file such statements or exhibits as required herein shall constitute cause, after notice and hearing, for censure, suspension, or revocation of certificate of authority to transact an insurance business in this state or a fine of not less than One Hundred Dollars ($100.00) nor more than One Thousand Dollars ($1,000.00) for each occurrence, or both censure, suspension, or revocation, and fine. The Commissioner shall set such cause for hearing and if he finds that the facts warrant, he shall order said censure, suspension, or revocation of the certificate of authority of the insurer found to be in default or said fine, or both said censure, suspension, or revocation, and fine. Willful violations, after notice and hearing, may subject the insurer to both censure, suspension or revocation of certificate and a fine of not less than One Hundred Dollars ($100.00) or not more than Five Thousand Dollars ($5,000.00) for each violation. The Insurance Commissioner may establish rules or regulations to carry out the purposes of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1970, c. 108, &sect; 1, operative Sept. 30, 1970. Amended by Laws 1974, c. 264, &sect; 4, emerg. eff. May 29, 1974; Laws 1983, c. 68, &sect; 5, eff. Nov. 1, 1983; Laws 1985, c. 328, &sect; 3, emerg. eff. July 29, 1985; Laws 1986, c. 251, &sect; 3, emerg. eff. June 13, 1986; Laws 2002, c. 307, &sect; 2, eff. Nov. 1, 2002.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36311.3. Financial reports regarding real property.&nbsp;</span></p> <p><span class="cls0">In all financial reports of an insurer to the Insurance Commissioner, real property acquired by the insurer shall be entered as an asset on the basis of its original cost along with appropriate adjustments, or the appraised market value where it is expressly indicated that such amount is based on the appraised market value and such appraisal has approval of the Insurance Commissioner.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1972, c. 151, &sect; 1, eff. Oct. 1, 1972. &nbsp;</span></p> <p><span class="cls0">&sect;36-311.4. Annual statements reporting market conduct data of insurers - Adoption of rules - Filing fee - Use of documents.&nbsp;</span></p> <p><span class="cls0">A. Insurers authorized to do business under the provisions of the Oklahoma Insurance Code shall, annually, on or before the last day of June, file with the Insurance Commissioner market conduct annual statements reporting market conduct data of insurers on the thirty-first day of December of the previous year. The statements shall report on the lines of insurance and be in such general form and context as approved by the National Association of Insurance Commissioners, and as supplemented for additional information required by the Insurance Commissioner by rule. The statements shall be prepared in accordance with NAIC instructions, including any supplemental filings described in the NAIC instructions. If no forms or instructions are available from the National Association of Insurance Commissioners, the statements shall be in the form and pursuant to instructions as provided by the Insurance Commissioner. Insurers not authorized by the Insurance Commissioner to provide the lines of insurance approved by the National Association or the Insurance Commissioner shall not be required to file market conduct annual statements. For good cause shown, the Insurance Commissioner may extend the time within which market conduct annual statements may be filed. The Insurance Commissioner may provide copies of market conduct annual statements, amendments, and addendums to such statements and market conduct data taken from such statements to the National Association of Insurance Commissioners only if, prior to sharing of the market conduct annual statements, amendments, addendums to such statements or market conduct data taken from such statements, the National Association of Insurance Commissioners enters into a written agreement with the Insurance Commissioner to maintain the confidentiality of the shared information.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner may adopt rules implementing this section including rules that:&nbsp;</span></p> <p><span class="cls0">1. Add lines of insurance to be reported in market conduct annual statements; and&nbsp;</span></p> <p><span class="cls0">2. Require the filing of market conduct annual statements and any amendments and addendums to such statements with the National Association of Insurance Commissioners, and the payment of applicable filing fees required by the NAIC.&nbsp;</span></p> <p><span class="cls0">C. Insurers shall pay a filing fee of Two Hundred Dollars ($200.00) to the Insurance Commissioner for the filing of the market conduct annual statement.&nbsp;</span></p> <p><span class="cls0">D. No waiver of an applicable privilege or claim of confidentiality in the documents, materials, or other information shall occur as a result of disclosure to the Insurance Commissioner or the Commissioner&rsquo;s designee under this section or as a result of sharing the documents, materials or other information as provided in this section.&nbsp;</span></p> <p><span class="cls0">E. Market conduct annual statements and any amendments and addendums to such statements, filed with the Insurance Commissioner pursuant to this section in electronic format or otherwise, shall be treated as working papers and documents as set out in subsection F of Section 309.4 of Title 36 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">F. The Insurance Commissioner may use market conduct annual statements or amendments or addendums to such statements to assist in determining whether a market conduct examination or investigation of an insurer should be conducted. For purposes of completing a market conduct examination of any company under Sections 309.1 through 309.7 of Title 36 of the Oklahoma Statutes, the Insurance Commissioner may, in the sole discretion of the Insurance Commissioner, use market conduct annual statements or amendments or addendums to such statements to assist in determining compliance with the laws of this state and rules adopted by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 2, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.1. Short title - Oklahoma Annual Financial Report Act.&nbsp;</span></p> <p><span class="cls0">Sections 3 through 20 of this act shall be known as and may be cited as the &ldquo;Oklahoma Annual Financial Report Act&rdquo;.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 3, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.2. Purpose of act.&nbsp;</span></p> <p><span class="cls0">A. The purpose of the Oklahoma Annual Financial Report Act is to improve the surveillance of the Insurance Commissioner over the financial condition of insurers by requiring:&nbsp;</span></p> <p><span class="cls0">1. An annual audit of financial statements reporting the financial position and the results of operations of insurers by independent certified public accountants;&nbsp;</span></p> <p><span class="cls0">2. Communication of Internal Control Related Matters Noted in an Audit; and&nbsp;</span></p> <p><span class="cls0">3. Management&rsquo;s Report of Internal Control over Financial Reporting.&nbsp;</span></p> <p><span class="cls0">B. Every insurer as defined in Section 5 of this act shall be subject to the Oklahoma Annual Financial Report Act. Insurers having direct premiums written in this state of less than One Million Dollars ($1,000,000.00) in any calendar year and less than one thousand policy holders or certificate holders of direct written policies nationwide at the end of the calendar year shall be exempt from the Oklahoma Annual Financial Report Act for the year unless the Commissioner makes a specific finding that compliance is necessary for the Commissioner to carry out statutory responsibilities. Insurers having assumed premiums pursuant to contracts and treaties of reinsurance of One Million Dollars ($1,000,000.00) or more will not be so exempt.&nbsp;</span></p> <p><span class="cls0">C. Foreign or alien insurers filing the audited financial reports in another state, pursuant to the requirement of that state for filing of audited financial reports, which has been found by the Commissioner to be substantially similar to the requirements of the Oklahoma Annual Financial Report Act, are exempt from Sections 6 through 15 of this act if:&nbsp;</span></p> <p><span class="cls0">1. A copy of the audited financial report, Communication of Internal Control Related Matters Noted in an Audit, and the Accountant&rsquo;s Letter of Qualifications that are filed with the other state are filed with the Commissioner in accordance with the filing dates specified in Sections 6, 13 and 14 of this act, respectively. Canadian insurers may submit accountants&rsquo; reports as filed with the Office of the Superintendent of Financial Institutions, Canada; and&nbsp;</span></p> <p><span class="cls0">2. A copy of any Notification of Adverse Financial Condition Report filed with the other state is filed with the Commissioner within the time specified in Section 12 of this act.&nbsp;</span></p> <p><span class="cls0">D. Foreign or alien insurers required to file Management&rsquo;s Report of Internal Control over Financial Reporting in another state are exempt from filing the Report in this state provided the other state has substantially similar reporting requirements as determined by the Commissioner and the Report is filed with the Commissioner of the other state within the time specified.&nbsp;</span></p> <p><span class="cls0">E. The Oklahoma Annual Financial Report Act shall not prohibit, preclude, or in any way limit the Commissioner from ordering or conducting or performing examinations of insurers under the rules of the Insurance Department and the practices and procedures of the Insurance Department.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 4, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.3. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in the Oklahoma Annual Financial Report Act:&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Accountant&rdquo; or &ldquo;independent certified public accountant&rdquo; means an independent certified public accountant or accounting firm in good standing with the American Institute of Certified Public Accounts (AICPA), and in all states in which the accountant is licensed to practice and for Canadian and British companies, it means a Canadian-chartered or British-chartered accountant;&nbsp;</span></p> <p><span class="cls0">2. An &ldquo;affiliate&rdquo; of, or person &ldquo;affiliated&rdquo; with, a specific person, is a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Audit committee&rdquo; means a committee or equivalent body established by the board of directors of an entity for the purpose of overseeing the accounting and financial reporting processes of an insurer or group of insurers, and audits of financial statements of the insurer or group of insurers, and audits of financial statements of the insurer or group of insurers. The audit committee of any entity that controls a group of insurers may be deemed to be the audit committee for one or more of these controlled insurers solely for the purposes of the Oklahoma Annual Financial Report Act at the election of the controlling person. The exercise of this election shall be pursuant to subsection F of Section 16 of this act. If an audit committee is not designated by the insurer, the entire board of directors of the insurer shall constitute the audit committee;&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Audited financial report&rdquo; means and includes those items specified in Section 7 of this act;&nbsp;</span></p> <p><span class="cls0">5. &ldquo;Indemnification&rdquo; means an agreement of indemnity or a release from liability where the intent or effect is to shift or limit in any manner the potential liability of the person or firm for failure to adhere to applicable auditing or professional standards, whether or not resulting in part from knowing of other misrepresentations made by the insurer or its representatives;&nbsp;</span></p> <p><span class="cls0">6. &ldquo;Independent board member&rdquo; has the same meaning as described in subsection D of Section 16 of this act;&nbsp;</span></p> <p><span class="cls0">7. &ldquo;Insurer&rdquo; means a licensed insurer as defined in Section 103 of Title 36 of the Oklahoma Statutes. For purposes of the Oklahoma Annual Financial Report Act, insurer includes but is not limited to fraternal benefit societies, health maintenance organizations, multiple employer welfare arrangements, title insurers, and similar organizations licensed by the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">8. &ldquo;Group of insurers&rdquo; means those licensed insurers included in the reporting requirements of Article 16A of the Oklahoma Insurance Code, or a set of insurers as identified by management, for the purpose of assessing the effectiveness of internal control over financial reporting;&nbsp;</span></p> <p><span class="cls0">9. &ldquo;Internal control over financial reporting&rdquo; means a process effected by the board of directors, management, and other personnel of an entity designed to provide reasonable assurance regarding the reliability of the financial statements, i.e., those items specified in paragraphs 2 through 7 of subsection B of Section 7 of this act and includes those policies and procedures that:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;pertain to the maintenance of records that, in reasonable detail and accurately, fairly reflect the transactions and dispositions of assets,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements, i.e., those items specified in paragraphs 2 through 7 of subsection B of Section 7 of this act and that receipts and expenditures are being made only in accordance with authorizations of management and directors, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of assets that could have a material effect on the financial statements, i.e., those items specified in paragraphs 2 through 7 of subsection B of Section 7 of this act;&nbsp;</span></p> <p><span class="cls0">10. &ldquo;SEC&rdquo; means the United States Securities and Exchange Commission;&nbsp;</span></p> <p><span class="cls0">11. &ldquo;Section 404&rdquo; means Section 404 of the Sarbanes-Oxley Act of 2002 and the rules and regulations of the SEC promulgated thereunder;&nbsp;</span></p> <p><span class="cls0">12. &ldquo;Section 404 Report&rdquo; means the report on internal control over financial reporting of management as defined by the SEC and the related attestation report of the independent certified public accountant; and&nbsp;</span></p> <p><span class="cls0">13. &ldquo;SOX Compliant Entity&rdquo; means an entity that either is required to be compliant with, or voluntarily is compliant with, all of the following provisions of the Sarbanes-Oxley Act of 2002:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the preapproval requirements of Section 201 (Section 10A(i) of the Securities Exchange Act of 1934),&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the audit committee independence requirements of Section 301 (Section 10A(m)(3) of the Securities Exchange Act of 1934), and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the internal control over financial reporting requirements of Section 404 (Item 308 of SEC Regulation S-K).&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 5, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.4. Annual audit - Extensions.&nbsp;</span></p> <p><span class="cls0">A. All insurers shall have an annual audit by an independent certified public accountant and shall file an audited financial report with the Insurance Commissioner on or before June 1 for the year ended December 31 immediately preceding. The Commissioner may require an insurer to file an audited financial report earlier than June 1 with ninety (90) days advance notice to the insurer.&nbsp;</span></p> <p><span class="cls0">B. Extensions of the June 1 filing date may be granted by the Commissioner for thirty-day periods upon a showing by the insurer and its independent certified public accountant of the reasons for requesting an extension and determination by the Commissioner of good cause for an extension. The request for extension must be submitted in writing not less than ten (10) days prior to the due date in sufficient detail to permit the Commissioner to make an informed decision with respect to the requested extension.&nbsp;</span></p> <p><span class="cls0">C. If an extension is granted in accordance with the provisions in subsection B of this section, a similar extension of thirty (30) days is granted to the filing of Management&rsquo;s Report of Internal Control over Financial Reporting.&nbsp;</span></p> <p><span class="cls0">D. Every insurer required to file an annual audited financial report pursuant to the Oklahoma Annual Financial Report Act shall designate a group of individuals as constituting its audit committee. The audit committee of an entity that controls an insurer may be deemed to be the audit committee of the insurer for purposes of the Oklahoma Annual Financial Report Act at the election of the controlling person.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 6, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.5. Contents of annual audited financial report.&nbsp;</span></p> <p><span class="cls0">A. The annual audited financial report shall report the financial position of the insurer as of the end of the most recent calendar year and the results of its operations, cash flows, and changes in capital and surplus for the year then ended in conformity with statutory accounting practices prescribed, or otherwise permitted, by the Department of Insurance of the state of domicile.&nbsp;</span></p> <p><span class="cls0">B. The annual audited financial report shall include the following:&nbsp;</span></p> <p><span class="cls0">1. Report of independent certified public accountant;&nbsp;</span></p> <p><span class="cls0">2. Balance sheet reporting admitted assets, liabilities, capital, and surplus;&nbsp;</span></p> <p><span class="cls0">3. Statement of operations;&nbsp;</span></p> <p><span class="cls0">4. Statement of cash flows;&nbsp;</span></p> <p><span class="cls0">5. Statement of changes in capital and surplus;&nbsp;</span></p> <p><span class="cls0">6. Notes to financial statements. These notes shall be those required by the appropriate NAIC Annual Statement Instructions and the NAIC Accounting Practices and Procedures Manual. The notes shall include a reconciliation of differences, if any, between the audited statutory financial statements and the annual statement filed pursuant to Section 311 of Title 36 of the Oklahoma Statutes with a written description of the nature of these differences; and&nbsp;</span></p> <p><span class="cls0">7. The financial statements included in the audited financial report shall be prepared in a form and using language and groupings substantially the same as the relevant sections of the annual statement of the insurer filed with the Commissioner, and the financial statement shall be comparative, presenting the amounts as of December 31 of the current year and the amounts as of the immediately preceding December 31. However, in the first year in which an insurer is required to file an audited financial report, the comparative data may be omitted.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 7, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.6. Registration of the name and address of the accountant or accounting firm retained to conduct the annual audit - Accountant letter - Notification of dismissal or resignation.&nbsp;</span></p> <p><span class="cls0">A. Each insurer required by the Oklahoma Annual Financial Report Act to file an annual audited financial report must, within sixty (60) days after becoming subject to the requirement, register with the Insurance Commissioner in writing the name and address of the independent certified public accountant or accounting firm retained to conduct the annual audit set forth in the Oklahoma Annual Financial Report Act. Insurers not retaining an independent certified public accountant on the effective date of the Oklahoma Annual Financial Report Act shall register the name and address of their retained independent certified public accountant not less than six (6) months before the date when the first audited financial report is to be filed.&nbsp;</span></p> <p><span class="cls0">B. The insurer shall obtain a letter from the accountant, and file a copy with the Commissioner stating that the accountant is aware of the provisions of the insurance code and the regulations of the insurance department of the state of domicile that relate to accounting and financial matters and affirming that the accountant will express the opinion of the accountant on the financial statements in terms of their conformity to the statutory accounting practices prescribed or otherwise permitted by that insurance department, specifying such exceptions as the accountant may believe appropriate.&nbsp;</span></p> <p><span class="cls0">C. If an accountant who was the accountant for the immediately preceding filed audited financial report is dismissed or resigns, the insurer shall within five (5) business days notify the Commissioner of this event. The insurer shall also furnish the Commissioner with a separate letter within ten (10) business days of the above notification stating whether in the twenty-four (24) months preceding such event there were any disagreements with the former accountant on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of the former accountant, would have caused the former accountant to make reference to the subject matter of the disagreement in connection with the opinion of the former accountant. The disagreements required to be reported in response to this section include both those resolved to the satisfaction of the former accountant and those not resolved to the satisfaction of the former accountant. Disagreements contemplated by this section are those that occur at the decision-making level, between personnel of the insurer responsible for presentation of its financial statements and personnel of the accounting firm responsible for rendering its report. The insurer shall also in writing request the former accountant to furnish a letter addressed to the insurer stating whether the accountant agrees with the statements contained in the letter of the insurer and, if not, stating the reasons for which the accountant does not agree. The insurer shall furnish the responsive letter from the former accountant to the Commissioner together with its own.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 8, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.7. Qualified independent certified public accountants.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall not recognize a person or firm as a qualified independent certified public accountant if the person or firm:&nbsp;</span></p> <p><span class="cls0">1. Is not in good standing with the AICPA and in all states in which the accountant is licensed to practice, or, for a Canadian or British company, that is not a chartered accountant; or&nbsp;</span></p> <p><span class="cls0">2. Has either directly or indirectly entered into an agreement of indemnity or release from liability, collectively referred to as indemnification, with respect to the audit of the insurer.&nbsp;</span></p> <p><span class="cls0">B. Except as otherwise provided in the Oklahoma Annual Financial Report Act, the Commissioner shall recognize an independent certified public accountant as qualified as long as the accountant conforms to the standards of the profession, as contained in the Code of Professional Ethics of the AICPA and Rules and Regulations and Code of Ethics and Rules of Professional Conduct of the Oklahoma Board of Public Accountancy, or similar code.&nbsp;</span></p> <p><span class="cls0">C. A qualified independent certified public accountant may enter into an agreement with an insurer to have disputes relating to an audit resolved by mediation or arbitration. However, in the event of a delinquency proceeding commenced against the insurer under Article 19 of the Oklahoma Insurance Code, the mediation or arbitration provisions shall operate at the option of the statutory successor.&nbsp;</span></p> <p><span class="cls0">D. 1. The lead or coordinating audit partner having primary responsibility for the audit may not act in that capacity for more than five (5) consecutive years. The person shall be disqualified from acting in that or a similar capacity for the same company or its insurance subsidiaries or affiliates for a period of five (5) consecutive years. An insurer may make application to the Commissioner for relief from the above rotation requirement on the basis of unusual circumstances. This application should be made at least thirty (30) days before the end of the calendar year. The Commissioner may consider the following factors in determining if the relief should be granted:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;number of partners, expertise of the partners, or the number of insurance clients in the currently registered firm,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;premium volume of the insurer, or &nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;number of jurisdictions in which the insurer transacts business.&nbsp;</span></p> <p><span class="cls0">2. The insurer shall file, with its annual statement filing, the approval for relief from paragraph 1 of this subsection with the states that it is licensed in or doing business in and with the NAIC. If the nondomestic state accepts electronic filing with the NAIC, the insurer shall file the approval in an electronic format acceptable to the NAIC.&nbsp;</span></p> <p><span class="cls0">E. The Commissioner shall neither recognize as a qualified independent certified public accountant, nor accept an annual audited financial report, prepared in whole or in part by, a natural person who:&nbsp;</span></p> <p><span class="cls0">1. Has been convicted of fraud, bribery, a violation of the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. Sections 1961 to 1968, or any dishonest conduct or practices under federal or state law;&nbsp;</span></p> <p><span class="cls0">2. Has been found to have violated the insurance laws of this state with respect to any previous reports submitted under the Oklahoma Annual Financial Report Act; or&nbsp;</span></p> <p><span class="cls0">3. Has demonstrated a pattern or practice of failing to detect or disclose material information in previous reports filed under the provisions of the Oklahoma Annual Financial Report Act.&nbsp;</span></p> <p><span class="cls0">F. The Commissioner may hold a hearing to determine whether an independent certified public accountant is qualified and, considering the evidence presented, may rule that the accountant is not qualified for purposes of expressing the opinion of the accountant on the financial statements in the annual audited financial report made pursuant to the Oklahoma Annual Financial Report Act and require the insurer to replace the accountant with another whose relationship with the insurer is qualified within the meaning of the Oklahoma Annual Financial Report Act.&nbsp;</span></p> <p><span class="cls0">G. 1. The Commissioner shall not recognize as a qualified independent certified public accountant, nor accept an annual audited financial report, prepared in whole or in part by an accountant who provides to an insurer, contemporaneously with the audit, the following non-audit services:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;bookkeeping or other services related to the accounting records or financial statements of the insurer,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;financial information systems design and implementation,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;appraisal or valuation services, fairness opinions, or contribution-in-kind reports,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;actuarially oriented advisory services involving the determination of amounts recorded in the financial statements. The accountant may assist an insurer in understanding the methods, assumptions, and inputs used in the determination of amounts recorded in the financial statement only if it is reasonable to conclude that the services provided will not be subject to audit procedures during an audit of the financial statements of the insurer. The actuary of an accountant may also issue an actuarial opinion or certification on the reserves of an insurer if the following conditions have been met:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;neither the accountant nor the actuary of the accountant has performed any management functions or made any management decisions,&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;the insurer has competent personnel or engages a third-party actuary to estimate the reserves for which management takes responsibility, and&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;the actuary of the accountant tests the reasonableness of the reserves after the management of the insurer has determined the amount of the reserves,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;internal audit outsourcing services,&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;management functions or human resources,&nbsp;</span></p> <p class="cls2"><span class="cls0">g.&nbsp;&nbsp;broker or dealer, investment adviser, or investment banking services,&nbsp;</span></p> <p class="cls2"><span class="cls0">h.&nbsp;&nbsp;legal services or expert services unrelated to the audit, or &nbsp;</span></p> <p class="cls2"><span class="cls0">i.&nbsp;&nbsp;any other services that the Commissioner determines, by rule, are impermissible.&nbsp;</span></p> <p><span class="cls0">2. In general, the principles of independence with respect to services provided by the qualified independent certified public accountant are largely predicated on three basic principles, violations of which would impair the independence of the accountant. The principles are that the accountant cannot function in the role of management, cannot audit the own work of the accountant, and cannot serve in an advocacy role for the insurer.&nbsp;</span></p> <p><span class="cls0">H. Insurers having direct written and assumed premiums of less than One Hundred Million Dollars ($100,000,000.00) in any calendar year may request an exemption from paragraph 1 of subsection G of this section. The insurer shall file with the Commissioner a written statement discussing the reasons why the insurer should be exempt from these provisions. If the Commissioner finds, upon review of the statement, that compliance with the Oklahoma Annual Financial Report Act would constitute a financial or organizational hardship upon the insurer, an exemption may be granted.&nbsp;</span></p> <p><span class="cls0">I. A qualified independent certified public accountant who performs the audit may engage in other non-audit services, including tax services, that are not described in paragraph 1 of subsection G of this section or that do not conflict with paragraph 2 of subsection G of this section, only if the activity is approved in advance by the audit committee, in accordance with subsection J of this section.&nbsp;</span></p> <p><span class="cls0">J. All auditing services and non-audit services provided to an insurer by the qualified independent certified public accountant of the insurer shall be preapproved by the audit committee. The preapproval requirement is waived with respect to non-audit services if the insurer is a SOX Compliant Entity or a direct or indirect wholly-owned subsidiary of a SOX Compliant entity or:&nbsp;</span></p> <p><span class="cls0">1. The aggregate amount of all such non-audit services provided to the insurer constitutes not more than five percent (5%) of the total amount of fees paid by the insurer to its qualified independent certified public accountant during the fiscal year in which the non-audit services are provided;&nbsp;</span></p> <p><span class="cls0">2. The services were not recognized by the insurer at the time of the engagement to be non-audit services; and&nbsp;</span></p> <p><span class="cls0">3. The services are promptly brought to the attention of the audit committee and approved prior to the completion of the audit by the audit committee or by one or more members of the audit committee who are the members of the board of directors to whom authority to grant such approvals has been delegated by the audit committee.&nbsp;</span></p> <p><span class="cls0">K. The audit committee may delegate to one or more designated members of the audit committee the authority to grant the preapprovals required by subsection J of this section. The decisions of any member to whom this authority is delegated shall be presented to the full audit committee at each of its scheduled meetings.&nbsp;</span></p> <p><span class="cls0">L. 1. The Commissioner shall not recognize an independent certified public accountant as qualified for a particular insurer if a member of the board, president, chief executive officer, controller, chief financial officer, chief accounting officer, or any person serving in an equivalent position for that insurer, was employed by the independent certified public accountant and participated in the audit of that insurer during the one-year period preceding the date that the most current statutory opinion is due. This subsection shall only apply to partners and senior managers involved in the audit. An insurer may make application to the Commissioner for relief from the above requirement on the basis of unusual circumstances.&nbsp;</span></p> <p><span class="cls0">2. The insurer shall file, with its annual statement filing, the approval for relief from paragraph 1 of this subsection with the states that it is licensed in or doing business in and the NAIC. If the nondomestic state accepts electronic filing with the NAIC, the insurer shall file the approval in an electronic format acceptable to the NAIC.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 9, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.8. Audited consolidated or combined financial statements.&nbsp;</span></p> <p><span class="cls0">An insurer may make written application to the Insurance Commissioner for approval to file audited consolidated or combined financial statements in lieu of separate annual audited financial statements if the insurer is part of a group of insurance companies that utilizes a pooling or one hundred percent (100%) reinsurance agreement that affects the solvency and integrity of the reserves of the insurer and the insurer cedes all of its direct and assumed business to the pool. In such cases, a columnar consolidating or combining worksheet shall be filed with the report, as follows:&nbsp;</span></p> <p><span class="cls0">1. Amounts shown on the consolidated or combined audited financial report shall be shown on the worksheet;&nbsp;</span></p> <p><span class="cls0">2. Amounts for each insurer subject to this section shall be stated separately;&nbsp;</span></p> <p><span class="cls0">3. Noninsurance operations may be shown on the worksheet on a combined or individual basis;&nbsp;</span></p> <p><span class="cls0">4. Explanations of consolidating and eliminating entries shall be included; and&nbsp;</span></p> <p><span class="cls0">5. A reconciliation shall be included of any differences between the amounts shown in the individual insurer columns of the worksheet and comparable amounts shown on the annual statements of the insurers.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 10, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.9. Conduct of audit of financial statements.&nbsp;</span></p> <p><span class="cls0">Financial statements furnished pursuant to Section 7 of this act shall be examined by the independent certified public accountant. The audit of the financial statements of the insurer shall be conducted in accordance with generally accepted auditing standards. In accordance with AU Section 319 of the Professional Standards of the AICPA, Consideration of Internal Control in a Financial Statement Audit, the independent certified public accountant should obtain an understanding of internal control sufficient to plan the audit. To the extent required by AU 319, for those insurers required to file a Management&rsquo;s Report of Internal Control over Financial Reporting pursuant to Section 18 of this act, the independent certified public accountant should consider, as that term is defined in Statement on Auditing Standards (SAS) No. 102, Defining Professional Requirements in Statements on Auditing Standards or its replacement, the most recently available report in planning and performing the audit of the statutory financial statements. Consideration shall be given to the procedures illustrated in the Financial Condition Examiners Handbook promulgated by the National Association of Insurance Commissioners as the independent certified public accountant deems necessary.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 11, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.10. Reporting of determinations that insurer has materially misstated its financial condition - Liability - Subsequent awareness.&nbsp;</span></p> <p><span class="cls0">A. The insurer required to furnish the annual audited financial report shall require the independent certified public accountant to report, in writing, within five (5) business days to the board of directors or its audit committee any determination by the independent certified public accountant that the insurer has materially misstated its financial condition as reported to the Insurance Commissioner as of the balance sheet date currently under audit or that the insurer does not meet the minimum capital and surplus requirement of the Oklahoma Insurance Code as of that date. An insurer that has received a report pursuant to this subsection shall forward a copy of the report to the Commissioner within five (5) business days of receipt of the report and shall provide the independent certified public accountant making the report with evidence of the report being furnished to the Commissioner. If the independent certified public accountant fails to receive the evidence within the required five-business-day period, the independent certified public accountant shall furnish to the Commissioner a copy of its report within the next five (5) business days.&nbsp;</span></p> <p><span class="cls0">B. No independent certified public accountant shall be liable in any manner to any person for any statement made in connection with subsection A of this section if the statement is made in good faith in compliance with that subsection.&nbsp;</span></p> <p><span class="cls0">C. If the accountant, subsequent to the date of the audited financial report filed pursuant to the Oklahoma Annual Financial Report Act, becomes aware of facts that might have affected the report of the accountant, the accountant shall comply with the action or actions prescribed in Volume 1, Section AU 561 of the Professional Standards of the AICPA.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 12, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.11. Reporting unremediated material weaknesses of internal controls - Description of remedial actions.&nbsp;</span></p> <p><span class="cls0">A. In addition to the annual audited financial report, each insurer shall furnish the Insurance Commissioner with a written communication as to any unremediated material weaknesses in its internal controls over financial reporting noted during the audit. Such communication shall be prepared by the accountant within sixty (60) days after the filing of the annual audited financial report, and shall contain a description of any unremediated material weakness, as the term material weakness is defined by Statement on Auditing Standard 60, Communication of Internal Control Related Matters Noted in an Audit, or its replacement, as of December 31 immediately preceding, so as to coincide with the audited financial report discussed in subsection A of Section 4 of this act in the internal control over financial reporting of the insurer noted by the accountant during the course of their audit of the financial statements. If no unremediated material weaknesses were noted, the communication should so state.&nbsp;</span></p> <p><span class="cls0">B. The insurer is required to provide a description of remedial actions taken or proposed to correct unremediated material weaknesses if the actions are not described in the communication of the accountant.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 13, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.12. Accountant letter to insurer - Contents.&nbsp;</span></p> <p><span class="cls0">The accountant shall furnish the insurer in connection with, and for inclusion in, the filing of the annual audited financial report, a letter stating:&nbsp;</span></p> <p><span class="cls0">1. That the accountant is independent with respect to the insurer and conforms to the standards of the profession as contained in the Code of Professional Ethics and pronouncements of the AICPA and the Rules of Professional Conduct of the Oklahoma Board of Public Accountancy, or similar code;&nbsp;</span></p> <p><span class="cls0">2. The background and experience in general, and the experience in audits of insurers of the staff assigned to the engagement and whether each is an independent certified public accountant. Nothing within the Oklahoma Annual Financial Report Act shall be construed as prohibiting the accountant from utilizing such staff as the accountant deems appropriate where use is consistent with the standards prescribed by generally accepted auditing standards;&nbsp;</span></p> <p><span class="cls0">3. That the accountant understands the annual audited financial report and the opinion of the accountant thereon will be filed in compliance with the Oklahoma Annual Financial Report Act and that the Insurance Commissioner will be relying on this information in the monitoring and regulation of the financial position of insurers;&nbsp;</span></p> <p><span class="cls0">4. That the accountant consents to the requirements of Section 15 of this act and that the accountant consents and agrees to make available for review by the Commissioner the work papers, as defined in Section 15 of this act;&nbsp;</span></p> <p><span class="cls0">5. A representation that the accountant is properly licensed by an appropriate state licensing authority and is a member in good standing in the AICPA; and&nbsp;</span></p> <p><span class="cls0">6. A representation that the accountant is in compliance with the requirements of Section 9 of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 14, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.13. Work papers - Availability for examiner review - Copies.&nbsp;</span></p> <p><span class="cls0">A. Work papers are the records kept by the independent certified public accountant of the procedures followed, the tests performed, the information obtained, and the conclusions reached pertinent to the audit by the accountant of the financial statements of an insurer. Work papers, accordingly, may include audit planning documentation, work programs, analyses, memoranda, letters of confirmation and representation, abstracts of company documents, and schedules or commentaries prepared or obtained by the independent certified public accountant in the course of the audit of the financial statements of an insurer and which support the opinion of the accountant.&nbsp;</span></p> <p><span class="cls0">B. Every insurer required to file an audited financial report pursuant to the Oklahoma Annual Financial Report Act, shall require the accountant to make available for review by Insurance Department examiners, all work papers prepared in the conduct of the audit by the accountant and any communications related to the audit between the accountant and the insurer, at the offices of the insurer, at the offices of the Insurance Department, or at any other reasonable place designated by the Insurance Commissioner. The insurer shall require that the accountant retain the audit work papers and communications until the Insurance Department has filed a report on examination covering the period of the audit but no longer than seven (7) years from the date of the audit report.&nbsp;</span></p> <p><span class="cls0">C. In the conduct of the aforementioned periodic review by the Commissioner or Insurance Department examiners, it shall be agreed that photocopies of pertinent audit work papers may be made and retained by the Insurance Department. Such reviews by the Commissioner or Insurance Department examiners shall be considered investigations and all working papers, recorded information, documents, copies thereof and communications obtained during the course of such investigations shall be afforded the same confidentiality as other examination work papers generated by the Insurance Department pursuant to subsection F of Section 309.4 of this title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 15, eff. Nov. 1, 2009. Amended by Laws 2010, c. 356, &sect; 2, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.14. Audit committee - Membership - Duties.&nbsp;</span></p> <p><span class="cls0">A. This section shall not apply to foreign or alien insurers licensed in this state or an insurer that is a SOX Compliant Entity or a direct or indirect wholly-owned subsidiary of a SOX Compliant Entity.&nbsp;</span></p> <p><span class="cls0">B. The audit committee shall be directly responsible for the appointment, compensation, and oversight of the work of any accountant, including resolution of disagreements between management and the accountant regarding financial reporting, for the purpose of preparing or issuing the audited financial report or related work pursuant to the Oklahoma Annual Financial Report Act. Each accountant shall report directly to the audit committee.&nbsp;</span></p> <p><span class="cls0">C. Each member of the audit committee shall be a member of the board of directors of the insurer or a member of the board of directors of an entity elected pursuant to subsection F of this section and paragraph 3 of Section 5 of this act.&nbsp;</span></p> <p><span class="cls0">D. In order to be considered independent for purposes of this section, a member of the audit committee may not, other than in the capacity as a member of the audit committee, the board of directors, or any other board committee, accept any consulting, advisory, or other compensatory fee from the entity or be an affiliated person of the entity or subsidiary thereof. However, if law requires board participation by otherwise non-independent members, that law shall prevail and such members may participate in the audit committee and be designated as independent for audit committee purposes, unless they are an officer or employee of the insurer or one of its affiliates.&nbsp;</span></p> <p><span class="cls0">E. If a member of the audit committee ceases to be independent for reasons outside the reasonable control of the member, that person, with notice by the responsible entity to the state, may remain an audit committee member of the responsible entity until the earlier of the next annual meeting of the responsible entity or one year from the occurrence of the event that caused the member to be no longer independent.&nbsp;</span></p> <p><span class="cls0">F. To exercise the election of the controlling person to designate the audit committee for purposes of the Oklahoma Annual Finance Report Act, the ultimate controlling person shall provide written notice to the Insurance Commissioner of the affected insurers. Notification shall be made timely prior to the issuance of the statutory audit report and include a description of the basis for the election. The election can be changed through notice to the Commissioner by the insurer, which shall include a description of the basis for the change. The election shall remain in effect for perpetuity, until rescinded.&nbsp;</span></p> <p><span class="cls0">G. 1. The audit committee shall require the accountant that performs for an insurer any audit required by the Oklahoma Annual Financial Report Act to timely report to the audit committee in accordance with the requirements of SAS 61, Communication with Audit Committees, or its replacement, including:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;all significant accounting policies and material permitted practices,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;all material alternative treatments of financial information within statutory accounting principles that have been discussed with management officials of the insurer, ramifications of the use of the alternative disclosures and treatments, and the treatment preferred by the accountant, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;other material written communications between the accountant and the management of the insurer, such as any management or schedule of unadjusted differences;&nbsp;</span></p> <p><span class="cls0">2. If an insurer is a member of an insurance holding company system, the reports required by paragraph 1 of this subsection may be provided to the audit committee on an aggregate basis for insurers in the holding company system, provided that any substantial differences among insurers in the system are identified to the audit committee.&nbsp;</span></p> <p><span class="cls0">H. The proportion of independent audit committee members shall meet or exceed the following criteria set out in paragraphs 1, 2 and 3 of this subsection:&nbsp;</span></p> <p><span class="cls0">1. No Minimum Requirements. There are no minimum requirements for insurers with prior calendar year direct written and assumed premiums of Three Hundred Million Dollars ($300,000,000.00) or less;&nbsp;</span></p> <p><span class="cls0">2. Majority of Members. Fifty percent (50%) or more of members of the independent audit committee for insurers with prior calendar year direct written and assumed premiums of between Three Hundred Million Dollars ($300,000,000.00) and Five Hundred Million Dollars ($500,000,000.00); or&nbsp;</span></p> <p><span class="cls0">3. Supermajority of Members. Seventy-five percent (75%) or more of members of the independent audit committee for insurers with prior calendar year direct written and assumed premiums of over Five Hundred Million Dollars ($500,000,000.00).&nbsp;</span></p> <p><span class="cls0">I. The Commissioner may require improvements to the independence of the audit committee membership of any insurer if the insurer is in a RBC action level event, meets one or more of the standards of an insurer deemed to be in hazardous financial condition, or otherwise exhibits qualities of a troubled insurer.&nbsp;</span></p> <p><span class="cls0">J. For purposes of this section, prior calendar year direct written and assumed premiums shall be the combined total of direct premiums and assumed premiums from non-affiliates for the reporting entities.&nbsp;</span></p> <p><span class="cls0">K. An insurer with direct written and assumed premium, excluding premiums reinsured with the Federal Crop Insurance Corporation and Federal Flood Program, of less than Five Hundred Million Dollars ($500,000,000.00) may make application to the Commissioner for a waiver from the requirements of this section based upon hardship. The insurer shall file, with its annual statement filing, the approval for relief from this section with the states that it is licensed in or doing business in and the NAIC. If the nondomestic state accepts electronic filing with the NAIC, the insurer shall file the approval in an electronic format acceptable to the NAIC.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 16, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.15. Unlawful misleading statements - Manipulating accountant.&nbsp;</span></p> <p><span class="cls0">A. No director or officer of an insurer shall, directly or indirectly:&nbsp;</span></p> <p><span class="cls0">1. Make or cause to be made a materially false or misleading statement to an accountant in connection with any audit, review, or communication required under the Oklahoma Annual Financial Report Act; or&nbsp;</span></p> <p><span class="cls0">2. Omit to state, or cause another person to omit to state, any material fact necessary in order to make statements made, in light of the circumstances under which the statements were made, not misleading to an accountant in connection with any audit, review, or communication required under the Oklahoma Annual Financial Report Act.&nbsp;</span></p> <p><span class="cls0">B. No officer or director of an insurer, or any other person acting under the direction thereof, shall directly or indirectly take any action to coerce, manipulate, mislead, or fraudulently influence any accountant engaged in the performance of an audit pursuant to the Oklahoma Annual Financial Report Act if that person knew or should have known that the action, if successful, could result in rendering the financial statements of the insurer materially misleading.&nbsp;</span></p> <p><span class="cls0">C. For purposes of subsection B of this section, actions that, if successful, could result in rendering the financial statements of the insurer materially misleading include, but are not limited to, actions taken at any time with respect to the professional engagement period to coerce, manipulate, mislead, or fraudulently influence an accountant:&nbsp;</span></p> <p><span class="cls0">1. To issue or reissue a report on the financial statements of an insurer that is not warranted in the circumstances due to material violations of statutory accounting principles prescribed by the Insurance Commissioner, generally accepted auditing standards, or other professional or regulatory standards;&nbsp;</span></p> <p><span class="cls0">2. Not to perform audit, review or other procedures required by generally accepted auditing standards or other professional standards;&nbsp;</span></p> <p><span class="cls0">3. Not to withdraw an issued report; or&nbsp;</span></p> <p><span class="cls0">4. Not to communicate matters to the audit committee of an insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 17, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.16. Report of the insurer's internal control over financial reporting.&nbsp;</span></p> <p><span class="cls0">A. Every insurer required to file an audited financial report pursuant to the Oklahoma Annual Financial Report Act that has annual direct written and assumed premiums, excluding premiums reinsured with the Federal Crop Insurance Corporation and Federal Flood Program, of Five Hundred Million Dollars ($500,000,000.00) or more shall prepare a report of the insurer&rsquo;s or group of insurers&rsquo; internal control over financial reporting. The report shall be filed with the Insurance Commissioner along with the Communication of Internal Control Related Matters Noted in an Audit described under Section 13 of this act. Management&rsquo;s Report of Internal Control over Financial Reporting shall be as of December 31 immediately preceding.&nbsp;</span></p> <p><span class="cls0">B. Notwithstanding the premium threshold in subsection A of this section, the Commissioner may require an insurer to file Management&rsquo;s Report of Internal Control over Financial Reporting if the insurer is in any RBC level event, or meets any one or more of the standards of an insurer deemed to be in hazardous financial condition. &nbsp;</span></p> <p><span class="cls0">C. An insurer or a group of insurers that is:&nbsp;</span></p> <p><span class="cls0">1. Directly subject to Section 404;&nbsp;</span></p> <p><span class="cls0">2. Part of a holding company system whose parent is directly subject to Section 404;&nbsp;</span></p> <p><span class="cls0">3. Not directly subject to Section 404 but is a SOX Compliant Entity; or&nbsp;</span></p> <p><span class="cls0">4. A member of a holding company system whose parent is not directly subject to Section 404 but is a SOX Compliant Entity,&nbsp;</span></p> <p><span class="cls0">may file its or its parent&rsquo;s Section 404 Report and an addendum in satisfaction of the requirements of this section provided that those internal controls of the insurer or group of insurers&rsquo; audited statutory financial statements included in paragraphs 2 through 7 of subsection B of Section 7 of this act were included in the scope of the Section 404 Report. The addendum shall be a positive statement by management that there are no material processes with respect to the preparation of the insurer&rsquo;s or group of insurers&rsquo; audited statutory financial statements included in paragraphs 2 through 7 of subsection B of Section 7 of this act excluded from the Section 404 Report. If there are internal controls of the insurer or group of insurers that have a material impact on the preparation of the insurer&rsquo;s or group of insurers&rsquo; audited statutory financial statements and those internal controls were not included in the scope of the Section 404 Report, the insurer or group of insurers may either file a report pursuant to this section or the Section 404 Report and a report pursuant to this section for those internal controls that have a material impact on the preparation of the insurer&rsquo;s or group of insurers&rsquo; audited statutory financial statements not covered by the Section 404 Report.&nbsp;</span></p> <p><span class="cls0">D. Management&rsquo;s Report of Internal Control over Financial Reporting shall include:&nbsp;</span></p> <p><span class="cls0">1. A statement that management is responsible for establishing and maintaining adequate internal control over financial reporting;&nbsp;</span></p> <p><span class="cls0">2. A statement that management has established internal control over financial reporting and an assertion, to the best of the knowledge and belief of management, after diligent inquiry, as to whether its internal control over financial reporting is effective to provide reasonable assurance regarding the reliability of financial statements in accordance with statutory accounting principles;&nbsp;</span></p> <p><span class="cls0">3. A statement that briefly describes the approach or processes by which management evaluated the effectiveness of its internal control over financial reporting;&nbsp;</span></p> <p><span class="cls0">4. A statement that briefly describes the scope of work that is included and whether any internal controls were excluded;&nbsp;</span></p> <p><span class="cls0">5. Disclosure of any unremediated material weaknesses in the internal control over financial reporting identified by management as of December 31 immediately preceding. Management is not permitted to conclude that the internal control over financial reporting is effective to provide reasonable assurance regarding the reliability of financial statements in accordance with statutory accounting principles if there is one or more unremediated material weaknesses in its internal control over financial reporting;&nbsp;</span></p> <p><span class="cls0">6. A statement regarding the inherent limitations of internal control systems; and&nbsp;</span></p> <p><span class="cls0">7. Signatures of the chief executive officer and the chief financial officer or equivalent positions or titles.&nbsp;</span></p> <p><span class="cls0">E. Management shall document and make available upon financial condition examination the basis upon which its assertions, required in subsection D of this section, are made. Management may base its assertions, in part, upon its review, monitoring, and testing of internal controls undertaken in the normal course of its activities.&nbsp;</span></p> <p><span class="cls0">1. Management shall have discretion as to the nature of the internal control framework used, and the nature and extent of documentation, in order to make its assertion in a cost-effective manner and, as such, may include assembly of or reference to existing documentation.&nbsp;</span></p> <p><span class="cls0">2. Management&rsquo;s Report of Internal Control over Financial Reporting, required by subsection A of this section and any documentation provided in support thereof during the course of a financial condition examination, shall be kept confidential by the Insurance Department.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 18, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.17. Exemptions from compliance - Effective dates.&nbsp;</span></p> <p><span class="cls0">A. Upon written application of any insurer, the Insurance Commissioner may grant an exemption from compliance with any and all provisions of the Oklahoma Annual Financial Report Act if the Commissioner finds, upon review of the application, that compliance with the Oklahoma Annual Financial Report Act would constitute a financial or organizational hardship upon the insurer. An exemption may be granted at any time and from time to time for a specified period or periods. Within ten (10) days from a denial of the written request of an insurer for an exemption from the Oklahoma Annual Financial Report Act, the insurer may request in writing a hearing on its application for an exemption. The hearing shall be held in accordance with the Administrative Procedures Act and the laws and rules of the Insurance Department.&nbsp;</span></p> <p><span class="cls0">B. Domestic insurers retaining a certified public accountant who qualify as independent on the effective date of the Oklahoma Annual Financial Report Act shall comply with the Oklahoma Annual Financial Report Act for the year ending December 31, 2010, and each year thereafter unless the Commissioner permits otherwise.&nbsp;</span></p> <p><span class="cls0">C. Domestic insurers not retaining a certified public accountant on the effective date of the Oklahoma Annual Financial Report Act who qualifies as independent may meet the following schedule for compliance unless the Commissioner permits otherwise:&nbsp;</span></p> <p><span class="cls0">1. As of December 31, 2010, file with the Commissioner an audited financial report; and&nbsp;</span></p> <p><span class="cls0">2. For the year ending December 31, 2010, and each year thereafter, such insurers shall file with the Commissioner all reports and communication required by the Oklahoma Annual Financial Report Act.&nbsp;</span></p> <p><span class="cls0">D. Foreign insurers shall comply with the Oklahoma Annual Financial Report Act for the year ending December 31, 2010, and each year thereafter, unless the Commissioner permits otherwise.&nbsp;</span></p> <p><span class="cls0">E. The requirements of subsection D of Section 311A.7 of this title shall be in effect for audits of the year beginning January 1, 2010, and thereafter.&nbsp;</span></p> <p><span class="cls0">F. The requirements of Section 311A.14 of this title are to be in effect January 1, 2010. An insurer or group of insurers that is not required to have independent audit committee members or only a majority of independent audit committee members, as opposed to a supermajority, because the total written and assumed premium is below the threshold and subsequently becomes subject to one of the independence requirements due to changes in premium shall have one (1) year following the year the threshold is exceeded, but not earlier than January 1, 2010, to comply with the independence requirements. An insurer acquired as a result of a business combination shall have one (1) calendar year following the date of acquisition or combination to comply with the independence requirements.&nbsp;</span></p> <p><span class="cls0">G. The requirements of Section 311A.16 of this title are effective beginning with the reporting period ending December 31, 2010, and each year thereafter. An insurer or group of insurers that are not required to file a report because the total written premium is below the threshold and subsequently becomes subject to the reporting requirements shall have two (2) years following the year the threshold is exceeded, but not earlier than December 31, 2010, to file a report. Likewise, an insurer acquired in a business combination shall have two (2) calendar years following the date of acquisition or combination to comply with the reporting requirements.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 19, eff. Nov. 1, 2009. Amended by Laws 2010, c. 222, &sect; 4, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-311A.18. Canadian and British insurers - Letter of conformity.&nbsp;</span></p> <p><span class="cls0">A. In the case of Canadian and British insurers, the annual audited financial report shall be defined as the annual statement of total business on the form filed by such companies with their supervision authority duly audited by an independent chartered accountant.&nbsp;</span></p> <p><span class="cls0">B. For such insurers, the letter required in subsection B of Section 8 of this act shall state that the accountant is aware of the requirements relating to the annual audited financial report filed with the Insurance Commissioner pursuant to Section 6 of this act and shall affirm that the opinion expressed is in conformity with those requirements.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 20, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-312. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-312.1. Report, disbursement and appropriation of fees and taxes - Record and statement - Annual reports.&nbsp;</span></p> <p><span class="cls0">A. For the fiscal year ending June 30, 2004, the Insurance Commissioner shall report and disburse one hundred percent (100%) of the fees and taxes collected under Section 624 of this title to the State Treasurer to be deposited to the credit of the Education Reform Revolving Fund created pursuant to Section 34.89 of Title 62 of the Oklahoma Statutes. The Insurance Commissioner shall keep an accurate record of all such funds and make an itemized statement and furnish same to the State Auditor and Inspector, as to all other departments of this state. The report shall be accompanied by an affidavit of the Insurance Commissioner or the Chief Clerk of such office certifying to the correctness thereof.&nbsp;</span></p> <p><span class="cls0">B. For the fiscal year beginning July 1, 2006, and for each fiscal year thereafter, the Insurance Commissioner shall apportion an amount of the taxes and fees received from Section 624 of this title, which shall be at least One Million Two Hundred Fifty Thousand Dollars ($1,250,000.00) each year, but which shall also be computed on an annual basis by the Commissioner as the amount of insurance premium tax revenue loss attributable to the provisions of subsection H of Section 625.1 of this title and increased if necessary to reflect the annual computation, and which shall be apportioned before any other amounts, to the following pension systems and in the following amounts:&nbsp;</span></p> <p><span class="cls0">1. Sixty-five percent (65%) to the Oklahoma Firefighters Pension and Retirement Fund in the manner provided for in Sections 49-119, 49-120 and 49-123 of Title 11 of the Oklahoma Statutes;&nbsp;</span></p> <p><span class="cls0">2. Twenty-six percent (26%) to the Oklahoma Police Pension and Retirement System pursuant to the provisions of Sections 50-101 through 50-136 of Title 11 of the Oklahoma Statutes; and&nbsp;</span></p> <p><span class="cls0">3. Nine percent (9%) to the Law Enforcement Retirement Fund.&nbsp;</span></p> <p><span class="cls0">C. After the apportionment required by subsection B of this section, for the fiscal years beginning July 1, 2004, and ending June 30, 2009, the Insurance Commissioner shall report and disburse all of the fees and taxes collected under Section 624 of this title and Section 2204 of this title, and the same are hereby apportioned as follows:&nbsp;</span></p> <p><span class="cls0">1. Thirty-four percent (34%) of the taxes collected on premiums shall be allocated and disbursed for the Oklahoma Firefighters Pension and Retirement Fund, in the manner provided for in Sections 49-119, 49-120 and 49-123 of Title 11 of the Oklahoma Statutes;&nbsp;</span></p> <p><span class="cls0">2. Seventeen percent (17%) of the taxes collected on premiums shall be allocated and disbursed to the Oklahoma Police Pension and Retirement System pursuant to the provisions of Sections 50-101 through 50-136 of Title 11 of the Oklahoma Statutes;&nbsp;</span></p> <p><span class="cls0">3. Six and one-tenth percent (6.1%) of the taxes collected on premiums shall be allocated and disbursed to the Law Enforcement Retirement Fund; and&nbsp;</span></p> <p><span class="cls0">4. All the balance and remainder of the taxes and fees provided in Section 624 of this title shall be paid to the State Treasurer to the credit of the General Revenue Fund of the state to provide revenue for general functions of state government. The Insurance Commissioner shall keep an accurate record of all such funds and make an itemized statement and furnish same to the State Auditor and Inspector, as to all other departments of this state. The report shall be accompanied by an affidavit of the Insurance Commissioner or the Chief Clerk of such office certifying to the correctness thereof.&nbsp;</span></p> <p><span class="cls0">D. After the apportionment required by subsection B of this section, the Insurance Commissioner shall report and disburse all of the fees and taxes collected under Section 624 of this title and Section 2204 of this title, and the same are hereby apportioned as follows:&nbsp;</span></p> <p><span class="cls0">1. Thirty-six percent (36%) of the taxes collected on premiums shall be allocated and disbursed for the Oklahoma Firefighters Pension and Retirement Fund, in the manner provided for in Sections 49-119, 49-120 and 49-123 of Title 11 of the Oklahoma Statutes;&nbsp;</span></p> <p><span class="cls0">2. Fourteen percent (14%) of the taxes collected on premiums shall be allocated and disbursed to the Oklahoma Police Pension and Retirement System pursuant to the provisions of Sections 50-101 through 50-136 of Title 11 of the Oklahoma Statutes;&nbsp;</span></p> <p><span class="cls0">3. Five percent (5%) of the taxes collected on premiums shall be allocated and disbursed to the Law Enforcement Retirement Fund; and&nbsp;</span></p> <p><span class="cls0">4. All the balance and remainder of the taxes and fees provided in Section 624 of this title shall be paid to the State Treasurer to the credit of the General Revenue Fund of the state to provide revenue for general functions of state government. The Insurance Commissioner shall keep an accurate record of all such funds and make an itemized statement and furnish same to the State Auditor and Inspector, as to all other departments of this state. The report shall be accompanied by an affidavit of the Insurance Commissioner or the Chief Clerk of such office certifying to the correctness thereof.&nbsp;</span></p> <p><span class="cls0">E. The disbursements provided for in subsections A, B, C and D of this section shall be made monthly. The Insurance Commissioner shall report annually to the Governor, the Speaker of the House of Representatives, the President Pro Tempore of the Senate and the State Auditor and Inspector, the amounts collected and disbursed pursuant to this section.&nbsp;</span></p> <p><span class="cls0">F. Notwithstanding any other provision of law to the contrary, no tax credit authorized by law enacted on or after July 1, 2008, which may be used to reduce any insurance premium tax liability shall be used to reduce the amount of insurance premium tax revenue apportioned to the Oklahoma Firefighters Pension and Retirement System, the Oklahoma Police Pension and Retirement System or the Oklahoma Law Enforcement Retirement System.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 221, &sect; 312.1, operative July 1, 1957. Amended by Laws 1957, p. 632, &sect; 3, emerg. eff. May 31, 1957; Laws 1959, p. 133, &sect; 1, emerg. eff. July 8, 1959; Laws 1963, c. 316, &sect; 1, emerg. eff. June 19, 1963; Laws 1967, c. 43, &sect; 1, emerg. eff. March 29, 1967; Laws 1969, c. 132, &sect; 1, eff. July 1, 1969; Laws 1972, c. 58, &sect; 1, emerg. eff. March 21, 1972; Laws 1975, c. 34, &sect; 1, emerg. eff. March 25, 1975; Laws 1979, c. 30, &sect; 10, emerg. eff. April 6, 1979; Laws 1981, c. 6, &sect; 1, emerg. eff. March 19, 1981; Laws 1988, c. 83, &sect; 4, emerg. eff. March 25, 1988; Laws 2003, c. 315, &sect; 1, eff. July 1, 2003; Laws 2004, c. 368, &sect; 54, eff. July 1, 2004; Laws 2005, c. 381, &sect; 1, eff. July 1, 2006; Laws 2006, 2nd Ex. Sess., c. 46, &sect; 17, eff. July 1, 2006; Laws 2008, c. 436, &sect; 1, eff. July 1, 2009; Laws 2013, c. 165, &sect; 5, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-312A. Enforcement and recording of penalties and fees.&nbsp;</span></p> <p><span class="cls0">Civil penalties and fees imposed pursuant to the provisions of this title may be enforced in the same manner in which civil judgments may be enforced. All final orders of the Insurance Commissioner imposing administrative charges, fees, civil penalties or fines may be recorded in the office of the Clerk of the District Court of Oklahoma County and, upon such recording, all appropriate writs and process shall issue and shall be enforced by the judges of said court upon application.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 15, eff. Nov. 1, 1997. Amended by Laws 2006, c. 264, &sect; 5, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-313. Requirements for orders and notices - Final agency action - Applicability of Administrative Procedures Act.&nbsp;</span></p> <p><span class="cls0">A. Orders and notices of the Insurance Commissioner shall be in writing and shall be signed by either the Commissioner, an authorized employee of the Insurance Department, or an independent hearing examiner. A final order signed by an independent hearing examiner, after hearing, shall be final agency action, notwithstanding the provisions of Section 311 of Title 75 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">B. In the exercise of the powers and the performance of the duties enumerated in this title, the Commissioner shall comply with the procedures of the Administrative Procedures Act. Any conflict between the provisions of Title 75 of the Oklahoma Statutes and of this title shall be resolved in favor of the provisions of this title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 222, &sect; 313, operative July 1, 1957. Amended by Laws 1987, c. 175, &sect; 2, eff. Nov. 1, 1987; Laws 1997, c. 418, &sect; 16, eff. Nov. 1, 1997; Laws 2006, c. 264, &sect; 6, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-314. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-315. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-316. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-317. Witnesses or evidence.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may take depositions, subpoena witnesses or documentary evidence, administer oaths, and examine under oath any individual relative to the affairs of any person being examined, or relative to the subject of any hearing or investigation.&nbsp;</span></p> <p><span class="cls0">B. All administrative subpoenas shall be served in the same manner as if issued from a district court or in accordance with the Administrative Procedures Act. If any person fails to obey a subpoena lawfully served, the Commissioner may forthwith report such disobedience, together with a copy of the subpoena and proof of service thereof, to the district court of the county in which the person was required to appear, and such court shall forthwith cause such person to be produced and shall impose penalties as though the person had disobeyed a subpoena issued out of such court.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 223, &sect; 317. Amended by Laws 1997, c. 418, &sect; 17, eff. Nov. 1, 1997.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 1997, c. 133, &sect; 445 repealed by Laws 1999, 1st Ex.Sess., c. 5, &sect; 452, eff. July 1, 1999.&nbsp;</span></p> <p><span class="cls0">NOTE: Laws 1998, 1st Ex.Sess., c. 2, &sect; 23 amended the effective date of Laws 1997, c. 133, &sect; 445 from July 1, 1998, to July 1, 1999.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-318. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-319. Appointment of independent hearing examiner - Fees - Time period for issuance of final order.&nbsp;</span></p> <p><span class="cls0">In conducting any hearing pursuant to the Insurance Code, the Insurance Commissioner may appoint an independent hearing examiner who shall sit as a quasi-judicial officer. The ordinary fees and costs of such hearing examiner shall be assessed by the hearing examiner against the respondent, unless the respondent is the prevailing party. Within thirty (30) days after termination of the hearing or of any rehearing thereof or reargument thereon, unless such time is extended by stipulation, a final order shall be issued.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 224, &sect; 319. Amended by Laws 1987, c. 175, &sect; 3, eff. Nov. 1, 1987; Laws 1997, c. 418, &sect; 18, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-320. Judicial review.&nbsp;</span></p> <p><span class="cls0">A. Any person aggrieved by a final order of the Insurance Commissioner may obtain judicial review in accordance with the Administrative Procedures Act. The venue of any such action shall be in the district court of Oklahoma County. A copy of such petition shall also forthwith be served upon the Insurance Commissioner and other parties in interest, if any, and the Insurance Commissioner shall thereupon certify and file in such court a transcript of the record of such hearing and a copy of the order appealed from.&nbsp;</span></p> <p><span class="cls0">B. Upon filing of the petition the court shall have full jurisdiction, and shall determine whether such filing shall operate as a stay of the order appealed from.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 224, &sect; 320. Amended by Laws 1997, c. 418, &sect; 19, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-321. Fees and licenses - Deposits.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall collect in advance the following fees and licenses:&nbsp;</span></p> <p><span class="cls0">1. For filing charter documents:&nbsp;</span></p> <p class="cls6"><span class="cls0">Original charter documents, articles of incorporation, bylaws, or record of organization of alien or foreign insurers, or certified copies thereof&nbsp;&nbsp;$50.00&nbsp;</span></p> <p><span class="cls0">2. Certificate of Authority:&nbsp;</span></p> <p class="cls7"><span class="cls0">(a) Issuance:&nbsp;</span></p> <p class="cls8"><span class="cls0">Fraternal benefit societies, alien or foreign&nbsp;&nbsp;$150.00&nbsp;</span></p> <p class="cls8"><span class="cls0">Hospital service and medical indemnity corporations, alien or foreign&nbsp;&nbsp;$150.00&nbsp;</span></p> <p class="cls8"><span class="cls0">All other alien or foreign insurers&nbsp;&nbsp;$150.00&nbsp;</span></p> <p class="cls7"><span class="cls0">(b) Renewal:&nbsp;</span></p> <p class="cls8"><span class="cls0">Fraternal benefit societies, alien or foreign&nbsp;&nbsp;$150.00&nbsp;</span></p> <p class="cls8"><span class="cls0">Hospital service and medical indemnity corporations, alien or foreign&nbsp;&nbsp;$150.00&nbsp;</span></p> <p class="cls8"><span class="cls0">All other alien or foreign insurers&nbsp;&nbsp;$150.00&nbsp;</span></p> <p class="cls6"><span class="cls0">3. For filing appointment of Insurance Commissioner as agent for service of process&nbsp;&nbsp;$10.00&nbsp;</span></p> <p><span class="cls0">4. Miscellaneous:&nbsp;</span></p> <p class="cls8"><span class="cls0">(a) Copies of records, per page&nbsp;&nbsp;$0.40&nbsp;</span></p> <p class="cls8"><span class="cls0">(b) Amended charter documents, articles of incorporation or bylaws of domestic, alien or foreign insurers or health maintenance organizations&nbsp;&nbsp;$50.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(c) Certificate of Commissioner, under seal&nbsp;&nbsp;$5.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(d) For filing Merger and Acquisition Forms&nbsp;&nbsp;$1,000.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(e) For filing Variable Product Forms&nbsp;&nbsp;$200.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(f) For filing a Life, Accident and Health Policy and Health Maintenance Organization contract&nbsp;&nbsp;$50.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(g) For filing an advertisement or rider application to a Life, Accident and Health Policy and Health Maintenance Organization contract&nbsp;&nbsp;$25.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(h) Pending Company Review&nbsp;&nbsp;$1,000.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(i) For filing a Viatical Settlement Contract or Life Settlement&nbsp;&nbsp;$50.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(j) For filing an advertisement for Viatical Settlement or Life Settlement&nbsp;&nbsp;$25.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(k) For filing application for Viatical Settlement or Life Settlement Contract&nbsp;&nbsp;$25.00&nbsp;</span></p> <p class="cls8"><span class="cls0">(l) Miscellaneous form filing&nbsp;&nbsp;$25.00&nbsp;</span></p> <p><span class="cls0">B. There shall be assessed an annual fee of Five Hundred Dollars ($500.00) payable by each insurer, health maintenance organization, fraternal benefit society, hospital service and medical indemnity corporation, charitable and benevolent corporation, or United States surplus lines insurance companies licensed to do business in this state, to pay for the filing, processing, and reviewing of annual and quarterly financial statements by personnel of the Office of the State Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 224, &sect; 321, operative July 1, 1957. Amended by Laws 1965, c. 60, &sect; 6, eff. July 1, 1965; Laws 1967, c. 389, &sect; 1, emerg. eff. May 23, 1967; Laws 1968, c. 244, &sect; 1, emerg. eff. April 24, 1968; Laws 1969, c. 84, &sect; 1, emerg. eff. March 18, 1969; Laws 1977, c. 202, &sect; 4, emerg. eff. June 14, 1977; Laws 1980, c. 164, &sect; 14, emerg. eff. April 15, 1980; Laws 1983, c. 68, &sect; 7, eff. Nov. 1, 1983; Laws 1985, c. 328, &sect; 4, emerg. eff. July 29, 1985; Laws 1990, c. 258, &sect; 79, operative July 1, 1990; Laws 1992, c. 65, &sect; 1, eff. Sept. 1, 1992; Laws 1993, c. 270, &sect; 37, eff. Sept. 1, 1993; Laws 1994, c. 129, &sect; 1, eff. Sept. 1, 1994; Laws 2002, c. 307, &sect; 3, eff. Nov. 1, 2002; Laws 2004, c. 274, &sect; 2, eff. July 1, 2004; Laws 2009, c. 432, &sect; 3, eff. July 1, 2009.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-321.1. Report fees - Information requests - Costs.&nbsp;</span></p> <p><span class="cls0">A. There shall be collected at the time of filing of a report, a fee payable by each insurer required to file a report under Section 101 et seq. of this title, provided the insurer's total written premium per liability category exceeds the requisite filing fee, which shall be Four Hundred Dollars ($400.00) for each periodic claims report required by Section 1250.9 of this title.&nbsp;</span></p> <p><span class="cls0">B. All public requests for information provided by this act shall be in writing. All requests for copying such data shall be in writing and may be provided to the requestor after such reasonable time to process such copying and shall be at such costs as provided in Section 321 of this title or, if computerized printouts are necessary, at such reasonable costs as established by the Commissioner, or if such items cannot be reproduced by the Commissioner, then such information may, after notification to the requestor, be sent to a private contractor, and such costs shall be payable by the requestor.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 15, emerg. eff. June 24, 1986. Amended by Laws 1994, c. 294, &sect; 1, eff. Sept. 1, 1994; Laws 1997, c. 418, &sect; 20, eff. Nov. 1, 1997; Laws 2009, c. 432, &sect; 4, eff. July 1, 2009.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-331. Repealed by Laws 2006, c. 264, &sect; 81, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-332. General duties - Powers.&nbsp;</span></p> <p><span class="cls0">A. The Commissioner may conduct such examinations and investigations of insurance matters, within the scope of the authority of the Commissioner, as the Commissioner may deem proper to secure information useful in the lawful administration of the applicable provisions of the Oklahoma Insurance Code.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner shall have the authority to employ actuaries, statisticians, accountants, attorneys, auditors, investigators or any other technicians as the Insurance Commissioner may deem necessary or beneficial to examine any filings for rate revisions made by insurers or advisory organizations and to examine such records of the insurers or advisory organizations as may be deemed appropriate in conjunction with the filing for a rate revision in order to determine that the rates or other filings are consistent with the terms, conditions, requirements and purposes of the Insurance Code, and to verify, validate and investigate the information upon which the insurer or advisory organization relies to support such filing.&nbsp;</span></p> <p><span class="cls0">1. The Commissioner shall maintain a list of technicians qualified pursuant to rules adopted by the Commissioner who are proficient in the lines of insurance being reviewed. Upon request of the Commissioner, the Commissioner shall employ the next available technician in rotation on the list, proficient in the line or lines of insurance being reviewed. The Commissioner may deviate from the list when employing technicians for loss cost filings pursuant to Section 901.5 of this title.&nbsp;</span></p> <p><span class="cls0">2. All reasonable expenses incurred in such filing review shall be paid by the insurer or advisory organization making the filing.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner shall employ examiners to ensure that the rates which have been approved by or filed with the Commissioner are the rates which are being used by the insurer or by the insurers whose advisory organization has had a rate approval or rate filing.&nbsp;</span></p> <p><span class="cls0">1. Any insurer examined pursuant to the provisions of this section shall pay all reasonable charges incurred in such examination, including the actual expense of the Commissioner or the expenses and compensation of the authorized representative of the Commissioner and the expense and compensation of assistants and examiners employed therein.&nbsp;</span></p> <p><span class="cls0">2. All expenses incurred in such examination shall be verified by affidavit and a copy shall be filed and kept in the office of the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 226, &sect; 332, operative July 1, 1957. Amended by Laws 1965, c. 60, &sect; 5, eff. July 1, 1965; Laws 1979, c. 276, &sect; 2, emerg. eff. June 5, 1979; Laws 1980, c. 322, &sect; 6, eff. Jan. 1, 1981; Laws 1986, c. 207, &sect; 79, operative July 1, 1986; Laws 1987, c. 210, &sect; 5, eff. July 1, 1987; Laws 2001, c. 363, &sect; 4, eff. July 1, 2001; Laws 2006, c. 264, &sect; 7, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-333. Repealed by Laws 2006, c. 264, &sect; 81, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-334.1. Training of rate analysts and assistant rate analysts - Tuition and fees.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner is hereby authorized to arrange for the training of rate analysts and assistant rate analysts. Funds appropriated to the Insurance Commissioner may be used to pay the tuition and fees of the above personnel while receiving training related to the operations of the Property and Casualty Division.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1981, c. 192, &sect; 4, emerg. eff. May 22, 1981. Amended by Laws 1982, c. 238, &sect; 4, emerg. eff. May 4, 1982; Laws 1986, c. 207, &sect; 81, operative July 1, 1986; Laws 2006, c. 264, &sect; 8, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-335. Conflicts of interest - Exceptions.&nbsp;</span></p> <p><span class="cls0">No employee of the Insurance Department shall be financially interested, directly or indirectly, in any insurer, agency or insurance transaction except as a policyholder or claimant under a policy; except, that as to such matters wherein a conflict of interest does not exist on the part of any such individual, the Insurance Commissioner may employ from time to time insurance actuaries or other technicians who are independently practicing their professions even though similarly employed by insurers and others. This section shall not be deemed to prohibit employment by the Insurance Commissioner of retired or pensioned personnel of insurers or insurance organizations. In addition, this section shall not be deemed to prohibit employees of the Insurance Department from investing in mutual funds that may own stock in insurance companies, or from having an interest in retirement or pension plans, other than self-directed plans, that may own stock in insurance companies.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 226, &sect; 335. Amended by Laws 1980, c. 322, &sect; 9, eff. Jan. 1, 1981; Laws 1986, c. 207, &sect; 82, operative July 1, 1986; Laws 1997, c. 418, &sect; 21, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-341.1. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-344. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-346. Repealed by Laws 2006, c. 264, &sect; 81, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-348.1. Fees and licenses.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall collect the following fees and licenses for the Property and Casualty Division:&nbsp;</span></p> <p><span class="cls0">1. Rating organizations, statistical agents and advisory organizations:&nbsp;</span></p> <p class="cls9"><span class="cls0">a.&nbsp;&nbsp;Application fee for issuance of license&nbsp;&nbsp;$200.00&nbsp;</span></p> <p class="cls9"><span class="cls0">b.&nbsp;&nbsp;License fee&nbsp;&nbsp;$500.00&nbsp;</span></p> <p><span class="cls0">2. Miscellaneous:&nbsp;</span></p> <p class="cls9"><span class="cls0">a.&nbsp;&nbsp;Certificate of Insurance Commissioner, under seal&nbsp;&nbsp;$ 20.00&nbsp;</span></p> <p class="cls10"><span class="cls0">b.&nbsp;&nbsp;Upon each transaction of filing of documents required pursuant to the provisions of Sections 3610 and 6601 of this title:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;For an individual insurer&nbsp;&nbsp;$ 50.00&nbsp;</span></p> <p class="cls11"><span class="cls0">(2)&nbsp;&nbsp;For an approved joint underwriting association, or rating or advisory organization:&nbsp;</span></p> <p class="cls12"><span class="cls0">(a)&nbsp;&nbsp;Basic fee&nbsp;&nbsp;$ 50.00&nbsp;</span></p> <p class="cls13"><span class="cls0">(b)&nbsp;&nbsp;Additional fee for each member or subscriber insurer&nbsp;&nbsp;$ 10.00,&nbsp;</span></p> <p class="cls14"><span class="cls0">not to exceed&nbsp;&nbsp;$500.00.&nbsp;</span></p> <p><span class="cls0">3. For each rate, loss cost and rule filing request pursuant to the provisions of Sections 6821 and 981 et seq. of this title:&nbsp;</span></p> <p class="cls9"><span class="cls0">a.&nbsp;&nbsp;For an individual insurer&nbsp;&nbsp;$100.00&nbsp;</span></p> <p class="cls9"><span class="cls0">b.&nbsp;&nbsp;For an approved joint underwriting association, rating or advisory organization:&nbsp;</span></p> <p class="cls13"><span class="cls0">(1)&nbsp;&nbsp;Basic fee&nbsp;&nbsp;$100.00&nbsp;</span></p> <p class="cls13"><span class="cls0">(2)&nbsp;&nbsp;Additional fee for each member or subscriber insurer&nbsp;&nbsp;$ 10.00,&nbsp;</span></p> <p class="cls14"><span class="cls0">not to exceed&nbsp;&nbsp;$500.00.&nbsp;</span></p> <p><span class="cls0">B. The fees, licenses, and taxes imposed by the Commissioner upon persons, firms, associations, or corporations licensed pursuant to this section shall be payment in full with respect thereto of and in lieu of all demands for any and all state, county, district, and municipal license fees, license taxes, business privilege taxes, business privilege fees, and charges of every kind now or hereafter imposed upon all such persons, firms, associations, or corporations. This subsection shall not affect other fees, licenses and taxes imposed by the Insurance Code.&nbsp;</span></p> <p><span class="cls0">C. Any costs incurred by the Commissioner in the process of review and analysis of a filing shall be assessed against the company or organization making the filing.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 229, &sect; 348.1, operative July 1, 1957. Amended by Laws 1965, c. 60, &sect; 7, eff. July 1, 1965; Laws 1980, c. 322, &sect; 14, eff. Jan. 1, 1981; Laws 1983, c. 248, &sect; 4, emerg. eff. June 21, 1983; Laws 1985, c. 236, &sect; 3, operative Sept. 1, 1985; Laws 1986, c. 207, &sect; 86, operative July 1, 1986; Laws 1987, c. 210, &sect; 10, eff. July 1, 1987; Laws 1991, c. 215, &sect; 6, eff. July 1, 1991; Laws 2002, c. 307, &sect; 4, eff. Nov. 1, 2002; Laws 2005, c. 129, &sect; 1, eff. Nov. 1, 2005; Laws 2006, c. 264, &sect; 9, eff. July 1, 2006; Laws 2009, c. 432, &sect; 5, eff. July 1, 2009.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-349. Repealed by Laws 2001, c. 363, &sect; 30, eff. July 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-351. Renumbered as &sect; 1938 of this title by Laws 1997, c. 418, &sect; 127, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-352. Commissioner authorized to refund certain fees.&nbsp;</span></p> <p><span class="cls0">A. 1. Upon request by an applicant, the Insurance Commissioner may refund to the applicant all or any portion of any fees collected by the Commissioner pursuant to law including but not limited to any unearned fees and application fees. Such fees may be refunded, if requested, prior to any official action being taken by the Commissioner or prior to the occurrence of the action for which the application was made or in such other circumstances that the Commissioner deems proper.&nbsp;</span></p> <p><span class="cls0">2. The Commissioner may retain a portion of the fee if it is determined that administrative costs were incurred by the Insurance Department in the action.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner shall promulgate permanent rules and may promulgate emergency rules to implement the provisions of this section pursuant to the Administrative Procedures Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 24, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-353. Repealed by Laws 1999, c. 397, &sect; 47, emerg. eff. June 10, 1999.&nbsp;</span></p> <p><span class="cls0">&sect;36-361. Anti-Fraud Unit - Investigations - Confidentiality of records.&nbsp;</span></p> <p><span class="cls0">A. There is hereby created within the Insurance Department, under the control and direction of the Insurance Commissioner, an "Anti-Fraud Unit" within the Legal and Investigation Division of the Insurance Department.&nbsp;</span></p> <p><span class="cls0">B. Violations of any statute or administrative rule of this state pertaining to insurance fraud or pertaining to any insurance product or insurance organization that has been used as an instrument of criminal activity may be investigated by the Anti-Fraud Unit. Whenever the Unit determines that a violation of any criminal law of this state may have occurred, it may refer the matter to the Oklahoma State Bureau of Investigation for further investigation pursuant to Section 150.5 of Title 74 of the Oklahoma Statutes or the Attorney General pursuant to Section 18b of Title 74 of the Oklahoma Statutes. The Insurance Department shall retain the authority to initiate and prosecute any civil action it deems necessary or advisable.&nbsp;</span></p> <p><span class="cls0">C. The Anti-Fraud Unit may employ investigators who may be commissioned by the Insurance Commissioner to serve as peace officers, as defined by and pursuant to the guidelines and requirements of Section 3311 of Title 70 of the Oklahoma Statutes and Sections 99 and 99a of Title 21 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">D. Records, documents, reports and evidence obtained or created by the Anti-Fraud Unit as a result of an inquiry or investigation of any suspected insurance related crime shall be confidential and shall not be subject to the Oklahoma Open Records Act or to outside review or release by any individual. Information and records shall be disclosed upon request to officers and agents of federal, state, county, or municipal law enforcement agencies, to the Oklahoma State Bureau of Investigation, to the Attorney General's office and to district attorneys, in the furtherance of criminal investigations.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 344, &sect; 1, emerg. eff. June 8, 1999. Amended by Laws 2002, c. 307, &sect; 5, eff. Nov. 1, 2002; Laws 2004, c. 131, &sect; 1; Laws 2005, c. 129, &sect; 2, eff. Nov. 1, 2005; Laws 2009, c. 176, &sect; 21, eff. Nov. 1, 2009; Laws 2012, c. 235, &sect; 4, eff. July 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-362. Fees &ndash; Transfer to Attorney General&rsquo;s Insurance Fraud Unit Revolving Fund.&nbsp;</span></p> <p><span class="cls0">An annual fee of Seven Hundred Fifty Dollars ($750.00) shall be paid to the Insurance Commissioner to be expended by the Insurance Commissioner for the purposes of investigation of suspected insurance fraud and civil or administrative action in cases involving suspected insurance fraud. The following shall pay an annual fee of Seven Hundred Fifty Dollars ($750.00) to the Insurance Department which shall be payable quarterly in the amount of One Hundred Eighty-seven Dollars and fifty cents ($187.50): Life, accident and health insurers; property and casualty insurers; county mutual fire insurers; mutual benefit associations; fraternal benefit societies; reciprocal insurers; motor service clubs; title insurers; nonprofit insurers; health maintenance organizations (HMOs); service warranty associations; surplus lines carriers; multiple employer welfare arrangements (MEWAs); trusts which write surety policies; prepaid dental plan organizations; and accredited reinsurers. The payments shall be due on or before the last day of the month following each calendar quarter. Beginning in the calendar year 2010, payment of the annual fee shall be made as one payment of Seven Hundred Fifty Dollars ($750.00) which shall be paid on or before July 1. Within sixty (60) days after each calendar quarter in which monies are collected, the Commissioner shall transfer twenty-five percent (25%) of all monies collected by the Insurance Department pursuant to this section to the Attorney General&rsquo;s Insurance Fraud Unit Revolving Fund created in Section 19.3 of Title 74 of the Oklahoma Statutes, for use by the Attorney General in the investigation and prosecution of insurance fraud.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 344, &sect; 2, emerg. eff. June 8, 1999. Amended by Laws 2001, c. 363, &sect; 5, eff. July 1, 2001; Laws 2002, c. 307, &sect; 6, eff. Nov. 1, 2002; Laws 2004, c. 131, &sect; 2; Laws 2006, c. 264, &sect; 10, eff. July 1, 2006; Laws 2009, c. 432, &sect; 6, eff. July 1, 2009.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-363. Notification of suspected fraud - Immunity.&nbsp;</span></p> <p><span class="cls0">A. Any insurer, employee or agent of any insurer who has reason to believe that a person or entity has engaged in or is engaging in an act or practice that violates any statute or administrative rule of this state related to insurance fraud shall immediately notify the Anti-Fraud Unit of the Insurance Department and, in the case of an allegation of claimant fraud, the Workers' Compensation and Insurance Fraud Unit of the Office of the Attorney General.&nbsp;</span></p> <p><span class="cls0">B. No insurer, employee or agent of an insurer, or any other person acting in the absence of fraud, bad faith, reckless disregard for the truth, or actual malice shall be subject to civil liability for libel, slander or any other relevant tort or subject to criminal prosecution by virtue of filing of reports or furnishing other information either orally or in writing, concerning suspected, anticipated or completed fraudulent insurance acts to the Anti-Fraud Division of the Insurance Department or the Workers' Compensation and Insurance Fraud Unit of the Office of the Attorney General pursuant to subsection A of this section or to any other agency involved in the investigation or prosecution of suspected insurance fraud.&nbsp;</span></p> <p><span class="cls0">C. No civil or criminal cause of action of any nature shall exist against the person or entity by virtue of filing of reports or furnishing other information, either orally or in writing, concerning suspected, anticipated or completed fraudulent insurance acts to the Anti-Fraud Division of the Insurance Department pursuant to subsection A of this section or to any other agency involved in the investigation or prosecution of suspected insurance fraud. The immunity provided in this subsection shall extend to the act of providing or receiving information or reports to or from:&nbsp;</span></p> <p><span class="cls0">1. Law enforcement officials, their agents and employees;&nbsp;</span></p> <p><span class="cls0">2. The National Association of Insurance Commissioners, any state department of insurance, any federal or state agency or bureau established to detect and prevent fraudulent insurance activities, as well as any other organization established for the same purpose, their agents, employees or designees; and&nbsp;</span></p> <p><span class="cls0">3. Any organization or person involved in the prevention and detection of fraudulent insurance activities or that organization or person's employees, agents, or representatives.&nbsp;</span></p> <p><span class="cls0">The immunity provided in this subsection shall not extend to any person, insurer, or agent of an insurer for communications or publications about suspected insurance fraud to any other person or entity.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 344, &sect; 3, emerg. eff. June 8, 1999. Amended by Laws 2012, c. 175, &sect; 1, emerg. eff. May 1, 2012; Laws 2012, c. 235, &sect; 5, eff. July 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-364. Seizure of property used in insurance-related crimes.&nbsp;</span></p> <p><span class="cls0">A. Any tool, implement or instrumentality used or possessed in connection with any violation of an insurance-related crime or that is the fruit of an insurance-related crime, may be seized by a member of a state or local law enforcement agency upon process issued by any court of competent jurisdiction.&nbsp;</span></p> <p><span class="cls0">B. Seizure of property described in subsection A of this section may be made by a member of a state or local law enforcement agency without process if:&nbsp;</span></p> <p><span class="cls0">1. The seizure occurs in accordance with any applicable law or rule;&nbsp;</span></p> <p><span class="cls0">2. The seizure is incident to inspection under an administrative inspection warrant;&nbsp;</span></p> <p><span class="cls0">3. The seizure is incident to search made under a search warrant;&nbsp;</span></p> <p><span class="cls0">4. The seizure is incident to a lawful arrest;&nbsp;</span></p> <p><span class="cls0">5. The seizure is made pursuant to a valid consent to search;&nbsp;</span></p> <p><span class="cls0">6. The property seized has been the subject of a prior judgment in favor of the state in a criminal proceeding, or in an injunction or forfeiture proceeding under this act; or&nbsp;</span></p> <p><span class="cls0">7. There are reasonable grounds to believe that the property is directly or indirectly dangerous to health or safety.&nbsp;</span></p> <p><span class="cls0">C. When property is seized under this section, the seizing agency may:&nbsp;</span></p> <p><span class="cls0">1. Place the property under seal; or&nbsp;</span></p> <p><span class="cls0">2. Remove the property to a place selected and designated by the seizing agency.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2012, c. 235, &sect; 6, eff. July 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-365. Insurance-related crime property - Forfeiture - Replevin.&nbsp;</span></p> <p><span class="cls0">A. The following are subject to forfeiture:&nbsp;</span></p> <p><span class="cls0">1. Any tool used to commit an insurance-related crime;&nbsp;</span></p> <p><span class="cls0">2. Any implement of an insurance-related crime;&nbsp;</span></p> <p><span class="cls0">3. Any instrumentality of an insurance-related crime; and&nbsp;</span></p> <p><span class="cls0">4. Any fruit of an insurance-related crime.&nbsp;</span></p> <p><span class="cls0">B. A forfeiture of an item or other conveyance encumbered by a bona fide security interest is subject to the interest of the secured party where the secured party neither had knowledge of nor consented to the act or omission forming the ground for the forfeiture.&nbsp;</span></p> <p><span class="cls0">C. Property, described in subsection A of this section, seized and held for forfeiture shall not be subject to replevin and is subject only to the order and judgments of a court of competent jurisdiction hearing the forfeiture proceedings.&nbsp;</span></p> <p><span class="cls0">D. 1. The district attorney in the county where the seizure occurs or the Attorney General or the Insurance Department shall bring an action for forfeiture in a court of competent jurisdiction. The forfeiture action shall be brought within sixty (60) days from the date of seizure except where the attorney prosecuting the forfeiture in the sound exercise of discretion determines that no forfeiture action should be brought because of the rights of property owners, lienholders or secured creditors or because of exculpatory, exonerating or mitigating facts and circumstances.&nbsp;</span></p> <p><span class="cls0">2. The attorney prosecuting the forfeiture shall give notice of the forfeiture proceeding by mailing a copy of the complaint in the forfeiture proceeding to each person whose right, title, or interest of record in the Oklahoma Tax Commission, the Department of Public Safety, the Federal Aviation Agency, or any other department of the state or any other state or territory of the United States, or of the federal government, if the property is required to be registered in any such department.&nbsp;</span></p> <p><span class="cls0">3. Notice of the proceeding shall be given to any other person as may appear, from the facts and circumstances, to have any right, title or interest in or to the property.&nbsp;</span></p> <p><span class="cls0">4. The owner of the property or any person having or claiming right, title or interest in the property may, within sixty (60) days after the mailing of the notice, file a verified answer to the complaint and may appear at the hearing on the action for forfeiture.&nbsp;</span></p> <p><span class="cls0">5. The attorney prosecuting the forfeiture shall show at a forfeiture hearing, by a preponderance of the evidence, that the property was used in the commission of a violation of an insurance-related crime, or was the fruit of an insurance-related crime.&nbsp;</span></p> <p><span class="cls0">6. The owner of property may show by a preponderance of the evidence that the owner did not know and did not have reason to know that the property was to be used or possessed in the commission of any violation or that any of the exceptions to forfeiture are applicable.&nbsp;</span></p> <p><span class="cls0">7. Unless the attorney prosecuting the forfeiture shall make the showing required of it, the court shall order the property released to the owner. Where the attorney prosecuting the forfeiture has made such a showing, the court may order:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the property to be destroyed by the agency which seized it or some other agency designated by the court,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the property be delivered and retained for use by the Insurance Department, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the property be sold at public sale.&nbsp;</span></p> <p><span class="cls0">E. A copy of a forfeiture order shall be filed with the sheriff of the county in which the forfeiture occurs and with each federal or state department with which the property is required to be registered. The order, when filed, constitutes authority for the issuance to the Insurance Department of a title certificate, registration certificate or other special certificate as may be required by law considering the condition of the property.&nbsp;</span></p> <p><span class="cls0">F. Proceeds from sale at public auction, after payment of all reasonable charges and expenses incurred by the agency designated by the court to conduct the sale in storing and selling the property, shall be paid to the Insurance Department Anti-Fraud Revolving Fund.&nbsp;</span></p> <p><span class="cls0">G. Seizing agencies shall utilize their best efforts to arrange for the towing and storing of motor vehicles in the most economical manner possible. The owner of a motor vehicle or a motor vehicle part shall not be required to pay more than the minimum reasonable costs of towing and storage.&nbsp;</span></p> <p><span class="cls0">H. A seized item that is neither forfeited nor unidentifiable shall be held subject to the order of the court in which the criminal action is pending or, if a request for its release from the custody is made until the district attorney has notified the defendant or the defendant's attorney of the request and both the prosecution and defense have been afforded a reasonable opportunity for an examination of the property to determine its true value and to produce or reproduce, by photographs or other identifying techniques, legally sufficient evidence for introduction at trial or other criminal proceedings. Upon expiration of a reasonable time for the completion of the examination which shall not exceed fourteen (14) days from the date of service upon the defense of the notice of request for return of property as provided, the property shall be released to the person making the request after satisfactory proof of the person's entitlement to the possession thereof. Upon application by either party with notice to the other, the court may order retention of the property if it determines that retention is necessary in the furtherance of justice.&nbsp;</span></p> <p><span class="cls0">I. When a seized item is forfeited, restored to its owner or disposed of as unidentifiable, the seizing agency shall retain a report of the transaction for a period of at least one (1) year from the date of the transaction.&nbsp;</span></p> <p><span class="cls0">J. When an applicant for a certificate of title or salvage certificate presents to the Oklahoma Tax Commission proof that the applicant purchased or acquired an item at a public sale conducted pursuant to this section and the fact is attested to by the seizing agency, the Oklahoma Tax Commission shall issue the appropriate certificate of title upon receipt of the statutory fee and properly executed application for a certificate of title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2012, c. 235, &sect; 7, eff. July 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-401. Short title.&nbsp;</span></p> <p><span class="cls0">Sections 1 through 6 of this act shall be known and may be cited as the &ldquo;Crimes By or Affecting Persons Engaged in the Business of Insurance Act&rdquo;.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2008, c. 184, &sect; 1, eff. July 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-402. Persons prohibited from engaging in business of insurance - Exception - Penalty.&nbsp;</span></p> <p><span class="cls0">A. No person who has been convicted of any criminal felony involving dishonesty or a breach of trust, or who has been convicted of an offense under Section 1033 of Title 18 of the United States Code, shall engage or participate in the business of insurance in this state or do any of the acts of an insurance business as set forth in Section 4 of this act.&nbsp;</span></p> <p><span class="cls0">B. A person described in subsection A of this section may engage in the business of insurance or participate in such business if such person has the written consent of the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">C. A person who violates subsection A of this section or any rule promulgated pursuant thereto is subject to a civil penalty of not more than Ten Thousand Dollars ($10,000.00) for each act of violation and for each day of violation.&nbsp;</span></p> <p><span class="cls0">D. The business of insurance includes title insurers for purposes of the Crimes by or Affecting Persons Engaged in the Business of Insurance Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2008, c. 184, &sect; 2, eff. July 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-403. Powers of Insurance Commissioner - Injunctive relief.&nbsp;</span></p> <p><span class="cls0">A. Whenever the Insurance Commissioner has reason to believe or it appears that any person has violated subsection A of Section 2 of this act, the Insurance Commissioner may:&nbsp;</span></p> <p><span class="cls0">1. Revoke any license or registration issued or approved by the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">2. Issue an ex parte cease and desist order under the procedures provided by Section 5 of this act;&nbsp;</span></p> <p><span class="cls0">3. Institute in the district court of Oklahoma County a civil suit for injunctive relief to restrain the person from continuing the violation;&nbsp;</span></p> <p><span class="cls0">4. Institute in the district court of Oklahoma County a civil suit to recover a civil penalty as provided for in Section 2 of this act; or&nbsp;</span></p> <p><span class="cls0">5. Exercise any combination of the acts provided for in this subsection.&nbsp;</span></p> <p><span class="cls0">B. On application for injunctive relief and a finding that a person is violating or threatening to violate any provision of the Crimes By or Affecting Persons Engaged in the Business of Insurance Act or order of the Insurance Commissioner issued pursuant to the Crimes By or Affecting Persons Engaged in the Business of Insurance Act, the district court shall grant the injunctive relief and the injunction shall be issued without bond.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2008, c. 184, &sect; 3, eff. July 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-404. Business of insurance.&nbsp;</span></p> <p><span class="cls0">Any one of the following acts in this state affected by mail or otherwise is defined to be doing the business of insurance in this state:&nbsp;</span></p> <p><span class="cls0">1. The making of or proposing to make, as an insurer, an insurance contract;&nbsp;</span></p> <p><span class="cls0">2. The making of or proposing to make, as guarantor or surety, any contract of guaranty or suretyship as a vocation and not merely incidental to any other legitimate business or activity of the guarantor or surety;&nbsp;</span></p> <p><span class="cls0">3. The taking or receiving of any application for insurance;&nbsp;</span></p> <p><span class="cls0">4. Maintaining any agency or office where any acts in furtherance of an insurance business are transacted, including but not limited to:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the execution of contracts of insurance with citizens of this or any other state,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;maintaining files or records of contracts of insurance,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the processing of claims, and&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;the receiving or collection of any premiums, commissions, membership fees, assessments, dues or other consideration for any insurance or any part thereof;&nbsp;</span></p> <p><span class="cls0">5. The issuance or delivery of contracts of insurance to residents of this state or to persons authorized to do business in this state;&nbsp;</span></p> <p><span class="cls0">6. Directly or indirectly acting as an agent for, or otherwise representing or aiding on behalf of another, any person or insurer in:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the solicitation, negotiation, procurement or effectuation of insurance or renewals thereof,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the dissemination of information as to coverage or rates, or forwarding of applications, or delivery of policies or contracts,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;inspection of risks,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;fixing of rates or investigation or adjustment of claims or losses,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;the transaction of matters subsequent to effectuation of the contract and arising out of it, or&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;in any other manner representing or assisting a person or insurer in the transaction of insurance with respect to subjects of insurance resident, located or to be performed in this state.&nbsp;</span></p> <p><span class="cls0">Provided, the provisions of this paragraph shall not operate to prohibit full-time salaried employees of a corporate insured from acting in the capacity of an insurance manager or buyer in placing insurance on behalf of such employer;&nbsp;</span></p> <p><span class="cls0">7. Contracting to provide indemnification or expense reimbursement in this state to persons domiciled in this state or for risks located in this state, whether as an insurer, agent, administrator, trust, funding mechanism, or by any other method, for any type of medical expenses including, but not limited to, surgical, chiropractic, physical therapy, speech pathology, audiology, professional mental health, dental, hospital, or optometric expenses, whether this coverage is by direct payment, reimbursement, or otherwise;&nbsp;</span></p> <p><span class="cls0">8. The doing of any kind of insurance business specifically recognized as constituting the doing of an insurance business within the meaning of the statutes relating to insurance;&nbsp;</span></p> <p><span class="cls0">9. Ownership in whole or in part, directly or indirectly, of any entity involved in the business of insurance;&nbsp;</span></p> <p><span class="cls0">10. Acquiring or assisting others in the acquisition or attempted acquisition of any entity involved in the business of insurance;&nbsp;</span></p> <p><span class="cls0">11. Possessing a license, registration or permit issued or approved by the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">12. Any other transactions of business in this state by an insurance company, producer, title insurance producer, adjuster, third-party administrator, service warranty association, title insurer or any other person that is licensed by or registered with the Insurance Commissioner; or&nbsp;</span></p> <p><span class="cls0">13. The doing of or proposing to do any insurance business in substance equivalent to any of the foregoing in a manner designed to evade the provisions of the statutes.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2008, c. 184, &sect; 4, eff. July 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-405. Emergency cease and desist order - Hearing - Judicial review - Attorneys fees.&nbsp;</span></p> <p><span class="cls0">A. On issuance of an emergency cease and desist order under Section 3 of this act, the Insurance Commissioner shall serve on the person affected by the order, by registered or certified mail, return receipt requested, to the person's last-known address, or by other lawful means, an order that contains a statement of the charges and requires the person immediately to cease and desist from the violation of subsection A of Section 2 of this act.&nbsp;</span></p> <p><span class="cls0">B. 1. If a person affected by an emergency cease and desist order seeks to contest that order, the person may request a hearing before the Insurance Commissioner. The person affected must request the hearing not later than the thirtieth day after the date on which the person receives the order. A request to contest an order must be in writing and directed to the Insurance Commissioner and must state the grounds for the request to set aside or modify the order.&nbsp;</span></p> <p><span class="cls0">2. On receiving the request for a hearing, the Insurance Commissioner shall serve notice of the time and place of the hearing at which the person requesting the hearing shall have the opportunity to show cause why the order should not be affirmed. The hearing is to be held not later than the tenth day after the date the Insurance Commissioner receives the request for a hearing unless the parties mutually agree to a later hearing date.&nbsp;</span></p> <p><span class="cls0">3. Pending the hearing, an emergency cease and desist order continues in full force and effect unless the order is stayed by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">4. The hearing on the order shall be conducted according to the procedures for contested cases under the Administrative Procedures Act.&nbsp;</span></p> <p><span class="cls0">5. At the hearing, the Insurance Commissioner shall affirm, modify or set aside in whole or in part the emergency cease and desist order.&nbsp;</span></p> <p><span class="cls0">C. A person aggrieved by a final order of the Insurance Commissioner pursuant to the Crimes By or Affecting Persons Engaged in the Business of Insurance Act may seek judicial review pursuant to Section 318 of Title 75 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">D. The Insurance Commissioner may recover reasonable attorney fees if judicial action is necessary for enforcement of the order.&nbsp;</span></p> <p><span class="cls0">E. A cease and desist order is final thirty-one (31) days after the date it is received if the person affected by the order does not request a hearing as provided by subsection B of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2008, c. 184, &sect; 5, eff. July 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-406. Rules.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner may promulgate rules necessary to carry out the provisions of the Crimes By or Affecting Persons Engaged in the Business of Insurance Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2008, c. 184, &sect; 6, eff. July 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36601. "Domestic" insurer defined.&nbsp;</span></p> <p><span class="cls0">A "domestic" insurer is one formed under the laws of Oklahoma.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 230, &sect; 601. &nbsp;</span></p> <p><span class="cls0">&sect;36602. "Foreign" insurer defined.&nbsp;</span></p> <p><span class="cls0">A "foreign" insurer is one formed under the laws of another state or government of the United States.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 230, &sect; 602. &nbsp;</span></p> <p><span class="cls0">&sect;36603. "Alien" insurer defined.&nbsp;</span></p> <p><span class="cls0">An "alien" insurer is one formed under the laws of a country other than the United States.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 230, &sect; 603. &nbsp;</span></p> <p><span class="cls0">&sect;36604. "State," "United States" defined.&nbsp;</span></p> <p><span class="cls0">A. "State" means any state, commonwealth, territory, or district of the United States.&nbsp;</span></p> <p><span class="cls0">B. "United States" includes the states, territories, districts, and commonwealths thereof.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 230, &sect; 604. &nbsp;</span></p> <p><span class="cls0">&sect;36605. "Charter" defined.&nbsp;</span></p> <p><span class="cls0">"Charter" means articles of incorporation, of agreement, of association, or other basic constituent document of a corporation, subscribers' agreement and power of attorney of a reciprocal insurer, or underwriters' agreement and power of attorney of a Lloyd's insurer.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 231, &sect; 605. &nbsp;</span></p> <p><span class="cls0">&sect;36606. Authority to transact insurance required.&nbsp;</span></p> <p><span class="cls0">A. No person shall act as an insurer and no insurer shall transact insurance in Oklahoma except as authorized by a subsisting authority granted to it by the Insurance Commissioner, except as to such transactions as are expressly otherwise provided for in this Code.&nbsp;</span></p> <p><span class="cls0">B. No such authority shall be required for an insurer, formerly so licensed in Oklahoma and now licensed in another state as a resident insurer or who has merged with an insurer in another state, to enable it to investigate and settle losses under its policies lawfully written in Oklahoma, or to liquidate such assets and liabilities of the insurer (other than collection of new premiums) as may have resulted from its former authorized operations in Oklahoma.&nbsp;</span></p> <p><span class="cls0">C. An insurer, who has relocated in another state or has merged with an insurer in another state and is not transacting new insurance business in Oklahoma but continuing collection of premiums on and servicing of policies remaining in force as to residents of or risks located in Oklahoma, is transacting insurance in Oklahoma for the purpose of premium tax requirements only and is not required to have a certificate of authority therefor. This subsection shall not apply to insurers which have withdrawn from Oklahoma prior to the effective date of this Code.&nbsp;</span></p> <p><span class="cls0">D. As to an insurance coverage on a subject of insurance not resident, located, or expressly to be performed in Oklahoma at time of issuance, and solicited, written, and delivered outside Oklahoma at the time of issuance, no such authority shall be required of an insurer as to subsequent transactions in Oklahoma on account thereof, and the provisions of this Code shall not apply to such insurance or insurance coverage, except for the purpose of premium tax requirements.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Amended by Laws 1985, c. 328, &sect; 5, emerg. eff. July 29, 1985. &nbsp;</span></p> <p><span class="cls0">&sect;36606.1. Certain foreign insurers may become domestic insurers Requirements and procedures.&nbsp;</span></p> <p><span class="cls0">A. 1. Any insurer which is organized under the laws of any other state and is admitted to do business in this state for the purpose of transacting insurance may become a domestic insurer by complying with all of the requirements of law relative to the organization and licensing of a domestic insurer of the same type and by designating its principal place of business at a location in this state, provided, the Insurance Commissioner approves the insurer's application for redomestication following a public hearing. Said domestic insurer will be entitled to like certificates and licenses to transact business in this state and shall be subject to the authority and jurisdiction of this state.&nbsp;</span></p> <p><span class="cls0">2. The Commissioner shall approve an insurer's application to redomesticate unless, after a public hearing thereon, he finds that: a. the insurer cannot comply with all the requirements of law relative to the organization and licensing of a domestic insurer,&nbsp;</span></p> <p><span class="cls0">b.&nbsp;&nbsp;after redomestication, the insurer would not be able to satisfy the requirements for the issuance of a license to write the line or lines of insurance for which it is presently licensed,&nbsp;</span></p> <p><span class="cls0">c.&nbsp;&nbsp;the effect of the redomestication would be substantially to lessen competition in insurance in this state or tend to create a monopoly therein,&nbsp;</span></p> <p><span class="cls0">d.&nbsp;&nbsp;the financial condition of the insurer is such as might jeopardize or prejudice the interest of its policyholders or the state and is not in the public interest, or&nbsp;</span></p> <p><span class="cls0">e.&nbsp;&nbsp;the competence, experience and integrity of those persons who control the operation of the insurer are such that it would not be in the interest of the policyholders, the public or the state to permit the redomestication.&nbsp;</span></p> <p><span class="cls0">3. The insurer's application to redomesticate shall contain information acceptable to the Commissioner concerning its financial condition, its plan of operation for the succeeding three (3) years, and information concerning the competence, experience and integrity of those persons who control the operation of the insurer.&nbsp;</span></p> <p><span class="cls0">4. The application for redomestication shall be deemed approved unless the Commissioner has, within thirty (30) days after the conclusion of the hearing, entered his order disapproving the redomestication.&nbsp;</span></p> <p><span class="cls0">B. Any domestic insurer may, upon the approval of the Insurance Commissioner, transfer its domicile to any other state in which it is admitted to transact the business of insurance, and upon such a transfer, shall cease to be a domestic insurer, and shall be admitted to this state if qualified as a foreign insurer. The Commissioner shall approve any such proposed transfer unless he shall determine such transfer is not in the interest of the policyholders of this state.&nbsp;</span></p> <p><span class="cls0">C. The certificate of authority, agents appointments and licenses, rates, and other items which the Insurance Commissioner allows, in his discretion, which are in existence at the time any insurer licensed to transact the business of insurance in this state transfers its corporate domicile to this or any other state by merger, consolidation or any other lawful method shall continue in full force and effect upon such transfer if such insurer remains duly qualified to transact the business of insurance in this state. All outstanding policies of any transferring insurer shall remain in full force and effect and need not be endorsed as to the new name of the company or its new location unless so ordered by the Commissioner. Every transferring insurer shall file new policy forms with the Commissioner on or before the effective date of the transfer, but may use existing policy forms with appropriate endorsements if allowed by, and under such conditions as approved by, the Commissioner. However, every such transferring insurer shall notify the Commissioner of the details of the proposed transfer, and shall file promptly, any resulting amendments to corporate documents required to be filed with the Commissioner.&nbsp;</span></p> <p><span class="cls0">D. The Insurance Commissioner may promulgate rules and regulations to carry out the purposes of this section.&nbsp;</span></p> <p><span class="cls0">&sect;36-607. General qualifications to transact insurance.&nbsp;</span></p> <p><span class="cls0">A. To qualify for and hold authority to transact insurance in Oklahoma an insurer must be otherwise in compliance with the provisions of this Code and with its charter powers, and must be an incorporated stock insurer, an incorporated mutual insurer, a mutual benefit association, a nonprofit hospital service and medical indemnity corporation, a farmers mutual fire insurance association, a Lloyd&rsquo;s association or a reciprocal insurer, of the same general type as may be formed as a domestic insurer under this Code; except, that no foreign or alien insurer shall be authorized to transact insurance in Oklahoma which does not maintain reserves as required by Article 15 of this Code applicable to the kind or kinds of insurance transacted by such insurer.&nbsp;</span></p> <p><span class="cls0">B. No certificate of authority or license to transact any kind of insurance business in this state shall be issued, renewed or continued in effect, to any domestic, foreign or alien insurance company or other insurance entity which is owned or financially controlled in whole or in part by another state of the United States, or by a foreign government, or by any political subdivision of either, or which is an agency of any such state, government or subdivision.&nbsp;</span></p> <p><span class="cls0">C. Any insurance company or other insurance entity which is owned or financially controlled in whole or in part by any federally recognized American Indian tribe or nation may apply for a certificate of authority or license to transact insurance business in this state and will not be subject to subsection B of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 231, &sect; 607, operative July 1, 1957. Amended by Laws 2013, c. 82, &sect; 1, eff. Nov. 1, 2013.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-607.1. Certain entities considered insurers - Audited financial reports.&nbsp;</span></p> <p><span class="cls0">A. An entity organized pursuant to the Interlocal Cooperation Act for the purpose of transacting insurance shall be considered an insurer at such time that the entity has within a twelve-month period received aggregate premiums of One Million Dollars ($1,000,000.00) for all kinds of insurance that the entity transacts. Such an entity shall be eligible to qualify for and hold a certificate of authority to transact insurance in this state.&nbsp;</span></p> <p><span class="cls0">B. An entity organized pursuant to the Interlocal Cooperation Act that transacts insurance and has within a twelve-month period received premiums or contributions of any amount for any kind of insurance that the entity transacts shall have an annual audit by an independent certified public accountant and shall file an audited financial report by an independent certified public accountant with the Insurance Commissioner within one hundred eighty (180) days immediately following the close of the Interlocal's fiscal year. The annual audited financial report shall be presented in conformity with accounting principles generally accepted in the United States of America and include:&nbsp;</span></p> <p><span class="cls0">1. The report of an independent certified public accountant in accordance with accounting principles generally accepted in the United States of America;&nbsp;</span></p> <p><span class="cls0">2. A balance sheet reporting assets, liabilities and equity;&nbsp;</span></p> <p><span class="cls0">3. A statement of operations;&nbsp;</span></p> <p><span class="cls0">4. A statement of cash flows;&nbsp;</span></p> <p><span class="cls0">5. A statement of changes in assets, liabilities and equity; and&nbsp;</span></p> <p><span class="cls0">6. Footnotes to financial statements.&nbsp;</span></p> <p><span class="cls0">C. Extensions of the filing date may be granted by the Commissioner for thirty-day periods upon a showing by the Interlocal Cooperative and its independent certified public accountant of the reasons for requesting an extension and determination by the Commissioner of good cause for an extension. The request for extension must be submitted in writing not less than ten (10) days prior to the due date in sufficient detail to permit the Commissioner to make an informed decision with respect to the requested extension.&nbsp;</span></p> <p><span class="cls0">D. The Commissioner may assess a fine for failure to file the required annual audit in an amount of not more than Five Hundred Dollars ($500.00) per day.&nbsp;</span></p> <p><span class="cls0">E. The audited financial reports required herein are subject to public inspection pursuant to the Oklahoma Open Records Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1994, c. 214, &sect; 1, eff. July 1, 1994. Amended by Laws 2006, c. 83, &sect; 1, eff. Nov. 1, 2006; Laws 2013, c. 306, &sect; 1, emerg. eff. May 16, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-608. Workers' compensation insurance.&nbsp;</span></p> <p><span class="cls0">A. A casualty insurer shall not be authorized to transact workers' compensation insurance in this state without first complying with the applicable provisions of Title 85 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">B. A claims adjuster for any insurer duly authorized to transact workers&rsquo; compensation insurance in Oklahoma shall be licensed pursuant to the Insurance Adjusters Licensing Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 231, &sect; 608, operative July 1, 1957. Amended by Laws 2010, c. 355, &sect; 1, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36609. Kinds of insurance an insurer may transact.&nbsp;</span></p> <p><span class="cls0">An insurer which otherwise qualifies therefor may be authorized to transact any one kind or combination of kinds of insurance as defined in Section 701 et seq. of this title, except:&nbsp;</span></p> <p><span class="cls0">1. A life insurer shall not be authorized to transact any other kind of insurance except accident and health and workers' compensation and employer liability equivalent insurance if otherwise qualified to do so on or after September 1, 1994, pursuant to the provisions of Section 65 of Title 85 of the Oklahoma Statutes or if immediately prior to the effective date of this Code any life insurer lawfully held a subsisting certificate of authority granting it the right to transact in Oklahoma additional kinds of insurance other than accident and health, so long as the insurer is otherwise in compliance with this Code the Insurance Commissioner shall continue to authorize such insurer to transact the same kinds of insurance as those specified in such prior certificate of authority;&nbsp;</span></p> <p><span class="cls0">&nbsp;&nbsp;2. A reciprocal insurer shall not transact life insurance;&nbsp;</span></p> <p><span class="cls0">3. A Lloyd's insurer shall not transact life insurance;&nbsp;</span></p> <p><span class="cls0">4. A title insurer shall be a stock insurer and shall not transact any other kind of insurance; and&nbsp;</span></p> <p><span class="cls0">5. No insurer shall issue for delivery or deliver in this state any contract of insurance which imposes contingent or assessment liability upon a resident of this state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 231, &sect; 609. Amended by Laws 1981, c. 112, &sect; 1; Laws 1986, c. 251, &sect; 4, eff. Nov. 1, 1986; Laws 1995, c. 355, &sect; 1, eff. July 1, 1995.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36610. Capital funds or minimum surplus required.&nbsp;</span></p> <p><span class="cls0">A. To qualify for authority to incorporate an insurance company or to transact any one or more kinds of insurance an insurer shall possess and maintain, after the effective date of this act, surplus in regard to policyholders, which is defined as the aggregate of the capital and surplus, in an amount not less than One Million Five Hundred Thousand Dollars ($1,500,000.00).&nbsp;</span></p> <p><span class="cls0">B. Any domestic insurer lawfully authorized to transact the business of insurance in Oklahoma immediately prior to the effective date of this act shall not be required to increase its capital or surplus to meet increased requirements of this act, provided, however, that in no event shall such insurer reduce its capital or surplus below the figure required of such insurer on October 31, 2002.&nbsp;</span></p> <p><span class="cls0">C. Wherever the language paidin capital, capital, capital stock or a similar term (if a stock company) or surplus, expendable surplus or a similar term (if a mutual or reciprocal insurer) is used elsewhere in this code, the term surplus in regard to policyholders may be used interchangeably when applicable.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 232, &sect; 610, operative July 1, 1957. Amended by Laws 1961, p. 266, &sect; 1, emerg. eff. March 29, 1961; Laws 1967, c. 231, &sect; 1, emerg. eff. May 4, 1967; Laws 1980, c. 185, &sect; 1, eff. Oct. 1, 1980; Laws 2002, c. 307, &sect; 7, eff. Nov. 1, 2002.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-611. Repealed by Laws 2003, c. 150, &sect; 8, eff. Nov. 1, 2003.&nbsp;</span></p> <p><span class="cls0">&sect;36612. Additional kinds of insurance Requirments.&nbsp;</span></p> <p><span class="cls0">A. An insurance company which incorporates or is authorized initially to transact the business of insurance in Oklahoma after the effective date of this act may transact all kinds of insurance with no additional capital or surplus requirements.&nbsp;</span></p> <p><span class="cls0">B. An insurance company which incorporated or was initially authorized to transact the business of insurance in Oklahoma prior to the effective date of this act and which is otherwise qualified therefor may be authorized to transact combinations of kinds of insurance (other than the life and accident and health combination shown in Section 610 of this article) while possessing and maintaining thereafter additional surplus in regard to policyholders not less in amount than that determined in subsection C of this section.&nbsp;</span></p> <p><span class="cls0">C. For any lawful combination add One Hundred Thousand Dollars ($100,000.00) for each additional kind of insurance included in the combination, to the amount required under Section 610 of this article for that one kind of insurance in the combination for which the largest amount is required under said Section 610, except:&nbsp;</span></p> <p><span class="cls0">1. Vehicle and accident and health insurance may be combined with casualty, and in any combination including casualty, without funds in addition to those required because of casualty.&nbsp;</span></p> <p><span class="cls0">2. An insurer, if otherwise qualified therefor, may be authorized to transact all kinds of insurance except life and title insurance.&nbsp;</span></p> <p><span class="cls0">3. The amount of such surplus in regard to policyholders shall not in any event be less than would be required if the insurer proposed to transact in Oklahoma all those kinds of insurance which it is transacting elsewhere.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 233, &sect; 612; Laws 1967, c. 231, &sect; 2, emerg. eff. May 4, 1967; Laws 1980, c. 185, &sect; 3, eff. Oct. 1, 1980. &nbsp;</span></p> <p><span class="cls0">&sect;36612.1. Kinds of insurance; requirements.&nbsp;</span></p> <p><span class="cls0">No insurer organized or authorized to write or issue noncancelable or guaranteed renewable accident and health policies in any state shall be, or continue to be, licensed to do business in this state unless the insurer possesses and maintains a surplus as regards policyholders in excess of Two Million Dollars ($2,000,000.00). Insurers licensed in this state on or before November 1, 1984, may maintain no less than One Million Dollars ($1,000,000.00) surplus as regards policyholders.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Amended by Laws 1984, c. 149, &sect; 3, eff. Nov. 1, 1984. &nbsp;</span></p> <p><span class="cls0">&sect;36612.2. Workers' compensation insurance Required capital and surplus.&nbsp;</span></p> <p><span class="cls0">After November 1, 1987, no insurer who requests to write workers' compensation insurance in this state shall be permitted to transact the business of workers' compensation insurance in this state unless the insurer possesses and maintains a surplus as regards policyholders, as defined in Section 610 of Title 36 of the Oklahoma Statutes, in excess of Five Million Dollars ($5,000,000.00). Should the surplus as regards policyholders fall below Five Million Dollars ($5,000,000.00), the insurer shall not be permitted to write any additional workers' compensation insurance until the surplus meets the statutory requirements as established in this section.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1987, c. 175, &sect; 4, eff. Nov. 1, 1987. &nbsp;</span></p> <p><span class="cls0">&sect;36-613. Deposit requirements.&nbsp;</span></p> <p><span class="cls0">A. Except as provided in subsection C of this section, any insurer that incorporates or is authorized initially to transact the business of insurance in Oklahoma after the effective date of this act shall not be issued a certificate of authority by the Insurance Commissioner unless it has deposited in trust with the State Treasurer through the Insurance Commissioner's office cash or securities eligible for the investment of capital funds of domestic insurers under this Code in an amount not less than Three Hundred Thousand Dollars ($300,000.00). The Insurance Commissioner may require a greater amount to be deposited in trust if the Insurance Commissioner finds that a greater amount is warranted for the protection of the policyholders of the insurer pursuant to rules promulgated by the Insurance Commissioner. Any amount over Three Hundred Thousand Dollars ($300,000.00) must be documented and reasons stated by the Commissioner in writing for the excess deposit amount. The Commissioner will annually review those insurers with deposits above Three Hundred Thousand Dollars ($300,000.00) to determine whether such additional deposits remain justified.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner shall not issue a certificate of authority to any insurer that incorporated or was initially authorized to transact the business of insurance in Oklahoma prior to the effective date of this act unless it has deposited in trust with the State Treasurer through the Insurance Commissioner's office cash or securities eligible for the investment of capital funds of domestic insurers under this Code in an amount not less than the surplus in regard to policyholders, or net admitted assets (if a Lloyd's association) required pursuant to this Code to be maintained for authority to transact the kinds of insurance to be transacted, except that in the case of life and/or accident and health insurers the deposit shall be in the amount of One Hundred Thousand Dollars ($100,000.00).&nbsp;</span></p> <p><span class="cls0">C. 1. As to domestic title insurers, the deposit shall be as required by Article 50 (Title Insurers).&nbsp;</span></p> <p><span class="cls0">2. As to foreign insurers, in lieu of such deposit or part thereof in this state, the Insurance Commissioner may accept the current certificate in proper form of the public official having supervision over insurers in any other state to the effect that a like deposit or part thereof by such insurer is being maintained in public custody in such state in trust for the purpose, among other reasonable purposes, of protection of all the insurer's policyholders or of all its policyholders and creditors.&nbsp;</span></p> <p><span class="cls0">3. As to alien insurers, other than title insurers, in lieu of such deposit or part thereof in this state, the Insurance Commissioner may accept the certificate of the official having supervision over insurance of another state in the United States, given under his hand and seal, that the insurer maintains within the United States by way of deposits with public depositaries, or in trust institutions within the United States approved by such official, assets available for discharge of its United States insurance obligations, which assets shall be in amount not less than the outstanding liabilities of the insurer arising out of its insurance transactions in the United States, together with the largest deposit required by this Code to be made in this state by any type of domestic insurer transacting like kinds of insurance.&nbsp;</span></p> <p><span class="cls0">D. Any securities deposited by insurers shall be issued to the Insurance Commissioner and the insurer and shall not be released by any company holding such security without the signatures of the Insurance Commissioner and the authorized insurer&rsquo;s personnel. Failure of any company holding such security to comply with this subsection may result, after hearing by the proper licensing authority, in a fine of not more than Twenty-five Thousand Dollars ($25,000.00) per occurrence.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 233, &sect; 613. Amended by Laws 1980, c. 185, &sect; 4, eff. Oct. 1, 1980; Laws 1986, c. 251, &sect; 5, eff. Nov. 1, 1986; Laws 2000, c. 353, &sect; 2, eff. Nov. 1, 2000.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36613.1. Surety bond or other security arrangement required.&nbsp;</span></p> <p><span class="cls0">Any insurance company transacting the business of property and casualty insurance in this state shall not be issued a new or renewal certificate of approval unless the company has provided a corporate surety bond or approved alternative security arrangement in an amount determined by the State Insurance Commissioner to be sufficient to provide for the return of unearned premiums if a policy is canceled during the term thereof by an insurance company. The State Insurance Commissioner shall promulgate rules and regulations to implement and carry out the provisions of this section.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1986, c. 134, &sect; 1, emerg. eff. April 17, 1986. &nbsp;</span></p> <p><span class="cls0">&sect;36-615. Repealed by Laws 2002, c. 307, &sect; 36, eff. Nov. 1, 2002.&nbsp;</span></p> <p><span class="cls0">&sect;36-615.1. Application to transact insurance - Application review.&nbsp;</span></p> <p><span class="cls0">A. Unless otherwise instructed by the Insurance Commissioner, an applicant requesting to be admitted to transact insurance in this state shall follow the instructions outlined in the National Association of Insurance Commissioners (NAIC) Uniform Certificate of Authority Application (UCAA) instructions.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner shall review and analyze each application with focus on the following:&nbsp;</span></p> <p><span class="cls0">1. Identification and evaluation of the business and strategic plans of the applicant, including but not limited to pro forma financial projections;&nbsp;</span></p> <p><span class="cls0">2. Assessment of the quality and expertise of the ultimate controlling person, proposed officers and directors, appointed actuary and appointed accountant, including the use of the NAIC Form A and SAD databases;&nbsp;</span></p> <p><span class="cls0">3. Adequacy of any proposed reinsurance program;&nbsp;</span></p> <p><span class="cls0">4. Adequacy of investment policy;&nbsp;</span></p> <p><span class="cls0">5. Adequacy of short-term and long-term financing arrangements, including, but not limited to:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;initial financing of proposed operations or transaction, and&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;maintenance of adequate capital and surplus levels;&nbsp;</span></p> <p><span class="cls0">6. Biographical affidavits;&nbsp;</span></p> <p><span class="cls0">7. Related party agreements&rsquo; compliance with SSAP No. 25; and&nbsp;</span></p> <p><span class="cls0">8. Any other information the Commissioner deems necessary to review.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2002, c. 307, &sect; 8, eff. Nov. 1, 2002. Amended by Laws 2011, c. 278, &sect; 2, eff. Nov. 1, 2011.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-615.2. Biographical affidavit.&nbsp;</span></p> <p><span class="cls0">All domestic insurers and health maintenance organizations are required to keep biographical information current. Domestic insurers and health maintenance organizations are required to provide Biographical Affidavits within thirty (30) days of any change in officers, directors, key management or any person acquiring ten percent (10%) or more controlling interest in a domestic insurer. The information shall be on the National Association of Insurance Commissioners (NAIC) UCAA Biographical Affidavit Form. The Biographical Affidavit is to be certified by an independent third party acceptable to the Insurance Commissioner that has conducted a comprehensive review of the background of the applicant and has indicated that the Biographical Affidavit has no significantly inaccurate or conflicting information and is accepted as the Business Character Report. As used in this section, &ldquo;independent third party&rdquo; is one that has no affiliation with the applicant and is in the business of providing background checks or investigations. The Business Character Report must be current and shall not be older than one (1) year.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2004, c. 274, &sect; 3, eff. July 1, 2004. Amended by Laws 2005, c. 129, &sect; 3, eff. Nov. 1, 2005.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36616. Issuance or refusal of certificate.&nbsp;</span></p> <p><span class="cls0">A. If upon completion of application the Insurance Commissioner finds that the insurer has met the requirements for and is entitled thereto under this Code, he shall issue to the insurer a proper certificate of authority; if he does not so find, the Insurance Commissioner shall issue his order refusing such certificate. The Insurance Commissioner shall not issue a certificate of authority to any domestic insurer incorporated after January 1, 1970, unless each of the shareholders of the common capital stock thereof is entitled at the shareholders meetings to one vote for each share standing in his name in the books of the corporation. The Insurance Commissioner shall act upon an application for a certificate of authority within thirty (30) days after its completion.&nbsp;</span></p> <p><span class="cls0">B. The certificate, if issued, shall specify the kind or kinds of insurance the insurer is authorized to transact in Oklahoma. At the insurer's request, the Insurance Commissioner may issue a certificate of authority limited to particular types of insurance included within a kind of insurance as defined in this code.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 234, &sect; 616; Laws 1969, c. 289, &sect; 1; Laws 1970, c. 109, &sect; 1, emerg. eff. April 1, 1970. &nbsp;</span></p> <p><span class="cls0">&sect;36617. Renewal and amendment of certificate.&nbsp;</span></p> <p><span class="cls0">A. All certificates of authority shall, beginning November 1, 2002, be perpetual and automatically renewed as of March 1 of each year, unless the insurer fails to qualify for renewal pursuant to the requirements of the Insurance Code.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner may amend a certificate of authority at any time to accord with changes in the insurer's charter or insuring powers.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 235, &sect; 617, operative July 1, 1957. Amended by Laws 2002, c. 307, &sect; 9, eff. Nov. 1, 2002.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36618. Mandatory revocation or suspension.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner shall refuse to renew or shall revoke or suspend an insurer's certificate of authority:&nbsp;</span></p> <p><span class="cls0">1. If such action is required by any provision of this Code, or&nbsp;</span></p> <p><span class="cls0">2. If the insurer no longer meets the requirements for the authority originally granted, on account of deficiency in assets or otherwise.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 235, &sect; 618. &nbsp;</span></p> <p><span class="cls0">&sect;36-619. Discretionary revocation or suspension; civil fines.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may after opportunity for a hearing refuse to renew, or may revoke or suspend an insurer's certificate of authority, in addition to other grounds in this Code, if the insurer:&nbsp;</span></p> <p><span class="cls0">1. Violates any provision of this Code other than those as to which refusal, suspension, or revocation is mandatory;&nbsp;</span></p> <p><span class="cls0">2. Knowingly fails to comply with any lawful rule or order of the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">3. Is found by the Insurance Commissioner to be in unsound condition or in such condition as to render its further transaction of insurance in this state hazardous to its policyholders or to the people of this state;&nbsp;</span></p> <p><span class="cls0">4. Without reasonable cause compels claimants under its policies to accept less than the amount due them or to bring suit against it to secure full payment;&nbsp;</span></p> <p><span class="cls0">5. Refuses to be examined or to produce its accounts, records, and files for examination by the Insurance Commissioner when required;&nbsp;</span></p> <p><span class="cls0">6. Fails to pay any final judgment rendered against it in this state within thirty (30) days after the judgment becomes final; or&nbsp;</span></p> <p><span class="cls0">7. Is affiliated with and under the same general management or interlocking directorate or ownership as another insurer which transacts direct insurance in this state without having a certificate of authority therefor, except as permitted to a surplus line insurer pursuant to Sections 1101 through 1120 of this title.&nbsp;</span></p> <p><span class="cls0">B. In addition to or in lieu of any applicable revocation or suspension of an insurer's certificate of authority, any insurer who knowingly and willfully violates this Code may be subject to a civil penalty of not more than Five Thousand Dollars ($5,000.00) for each occurrence.&nbsp;</span></p> <p><span class="cls0">C. In addition to or in lieu of any sanction, the Commissioner may require an insurer to restrict its insurance writings, obtain additional contributions to surplus, withdraw from the state, reinsure all or part of its business, increase capital, surplus, deposits or any other account for the security of policyholders or creditors, or provide independent actuarial review.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 235, &sect; 619. Amended by Laws 1980, c. 182, &sect; 1, eff. Oct. 1, 1980; Laws 1986, c. 251, &sect; 6, eff. Nov. 1, 1986; Laws 1997, c. 418, &sect; 25, eff. Nov. 1, 1997; Laws 2010, c. 222, &sect; 5, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36619.1. Availability of coverage without regard to geographic location.&nbsp;</span></p> <p><span class="cls0">All insurers, as a condition of their authority to transact insurance in this state, shall make available all of the kinds of insurance coverage that they are transacting in this state to all Oklahoma residents, without regard to geographic location, but subject to the insurers' underwriting standards.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1986, c. 134, &sect; 2, emerg. eff. April 17, 1986. &nbsp;</span></p> <p><span class="cls0">&sect;36-619.2. Workers' Compensation Fraud Unit of Office of Attorney General - Notification of certain violations.&nbsp;</span></p> <p><span class="cls0">Any insurer which has reason to believe that a person has engaged in or is engaging in an act or practice that violates any workers' compensation fraud statute or administrative rule of this state shall immediately notify the Workers' Compensation Fraud Unit of the Office of the Attorney General.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1993, c. 349, &sect; 30, eff. Sept. 1, 1993.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-619.3. Motor vehicle liability insurer compliance.&nbsp;</span></p> <p><span class="cls0">All insurers, as a condition of writing motor vehicle liability policies in this state, shall comply with the requirements of Section 7-600.2 of Title 47 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 340, &sect; 1, emerg. eff. May 27, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36620. Name of insurer.&nbsp;</span></p> <p><span class="cls0">A. No insurer shall be authorized to transact insurance in Oklahoma which has or uses a name so similar to that of any insurer already so authorized as to cause uncertainty or confusion; except, that in case of conflict of names between two insurers the Insurance Commissioner may permit or require the newlyauthorized insurer to use in Oklahoma such supplementation or modification of its name as may reasonably be necessary to avoid such conflict.&nbsp;</span></p> <p><span class="cls0">B. No insurer shall be authorized to transact insurance in Oklahoma which has or uses a name which tends to deceive or mislead as to the type of organization of the insurer.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 235, &sect; 620. &nbsp;</span></p> <p><span class="cls0">&sect;36-621. Service of legal process on foreign or alien insurers.&nbsp;</span></p> <p><span class="cls0">A. Each authorized foreign or alien insurer shall appoint the Insurance Commissioner as its agent to receive service of legal process, other than a subpoena, issued against it in this state upon any cause of action arising from its transaction of business in this state. The appointment shall be irrevocable, shall bind any successor and shall remain in effect as long as there is in force in this state any contract made by the insurer or obligations arising therefrom.&nbsp;</span></p> <p><span class="cls0">B. Service of such process against a foreign or alien insurer shall be made only by service of process upon the Insurance Commissioner. Service of process against a domestic insurer may be made upon the insurer in the manner provided by laws applying to business entities generally, or upon the insurer's attorneyinfact if a reciprocal insurer or a Lloyds association.&nbsp;</span></p> <p><span class="cls0">C. Each such insurer at time of application for a certificate of authority shall file with the Insurance Commissioner designation of the name and address of the person to whom process against it served upon the Insurance Commissioner is to be forwarded. The insurer may change such designation by a new filing.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 235, &sect; 621. Amended by Laws 1997, c. 418, &sect; 26, eff. Nov. 1, 1997; Laws 1997, c. 418, &sect; 26, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-622. Manner of service of process.&nbsp;</span></p> <p><span class="cls0">A. Triplicate copies of legal process against an insurer for whom the Insurance Commissioner is agent shall be served upon the Commissioner at the principal offices of the Insurance Department. When legal process against an insurer for whom the Insurance Commissioner is agent is issued, it shall be served in triplicate by any manner now provided by law or in lieu thereof by mailing triplicate copies of such legal process in the United States mails with postage prepaid to the Insurance Commissioner with return receipt requested, in which event service shall be sufficient upon showing of proof of mailing to the Commissioner with the return receipt attached. At the time of service the plaintiff shall pay to the Insurance Commissioner Twenty Dollars ($20.00), taxable as costs in the action. Upon receiving service, the Insurance Commissioner shall promptly forward a copy thereof by mail with return receipt requested to the person last so designated by the insurer to receive the same.&nbsp;</span></p> <p><span class="cls0">B. Process served upon the Insurance Commissioner and copy thereof forwarded as provided in this section shall constitute service upon the insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 236, &sect; 622, operative July 1, 1957. Amended by Laws 1983, c. 68, &sect; 6, eff. Nov. 1, 1983; Laws 1984, c. 215, &sect; 3, operative June 30, 1984; Laws 1986, c. 251, &sect; 7, emerg. eff. June 13, 1986; Laws 1997, c. 418, &sect; 27, eff. Nov. 1, 1997; Laws 2009, c. 432, &sect; 7, eff. July 1, 2009.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-623. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-624. Report of premiums, fees and taxes - Payment - Penalties.&nbsp;</span></p> <p><span class="cls0">A. Every insurance company, copartnership, insurance association, interinsurance exchange, person, insurer, nonprofit hospital service and medical indemnity corporation, or health maintenance organization, doing business in this state in the execution or exchange of contracts of insurance, indemnity or health maintenance services, or as an insurance company of any nature or character whatsoever, hereinafter referred to in this article as an insurance company, or company, shall, annually, on or before the first day of March, report under oath of the president or secretary or other chief officer of such company to the Insurance Commissioner, the total amount of direct written premiums, membership, application, policy and/or registration fees charged during the preceding calendar year, or since the last return of such direct written premiums, membership, application, policy and/or registration fees was made by such company, from insurance of every kind upon persons or on the lives of persons resident in this state, or upon real and personal property located within this state, and/or upon any other risks insured within this state, provided, that with respect to the tax payable annually, considerations received for annuity contracts and payments received by a health maintenance organization from the Secretary of Health and Human Services pursuant to a contract issued under the provisions of 42 U.S.C., Section 1395mm(g) shall no longer be deemed to be premiums for insurance and shall no longer be subject to the tax imposed by this section. Every such company shall, at the same time, pay to the Insurance Commissioner:&nbsp;</span></p> <p><span class="cls0">1. An annual license fee as prescribed by Section 321 of this title; and&nbsp;</span></p> <p><span class="cls0">2. An annual tax on all of the direct written premiums after all returned premiums are deducted, and on all membership, application, policy and/or registration fees, installment and/or finance fees or charges collected thereby, for the privileges of having written, continued and/or serviced insurance on lives, property and/or other risks in this state and of having made and serviced investments therein during the then expiring license year except premiums or fees paid by any county, city, town or school district funds or by their duly constituted authorities performing a public service organized pursuant to Sections 1001 through 1008 of Title 74 of the Oklahoma Statutes, or Sections 176 through 180.4 of Title 60 of the Oklahoma Statutes. Provided, no deduction shall be made from premiums for dividends paid to policyholders. The rate of taxation for all entities subject to the tax shall be two and twentyfive onehundredths percent (2.25%). If any insurance company or other entity liable for the taxes levied pursuant to the provisions of this section fails to remit such taxes in a timely manner, it shall remain liable therefor together with interest thereon at an annual rate equal to the average United States Treasury Bill rate of the preceding calendar year as certified by the State Treasurer on the first regular business day in January of each year, plus four percentage points.&nbsp;</span></p> <p><span class="cls0">B. For all insurance companies or other entities taxed pursuant to this section, the annual license fee and tax and all required membership, application, policy, registration, and agent appointment fees shall be in lieu of all other state taxes or fees, except those taxes and fees provided for in the Insurance Code, and the taxes and fees of any subdivision or municipality of the state, except ad valorem taxes and the tax required to be paid pursuant to Section 50001 of Title 68 of the Oklahoma Statutes. Provided, such license fee, tax and membership, application, policy, registration, and appointment fees shall be in lieu of any and all ad valorem taxes levied on intangible personal property. Any company, except health maintenance organizations, failing to make such returns and payments promptly and correctly shall forfeit and pay to the Insurance Commissioner, in addition to the amount of the taxes and fees and interest, the sum of Five Hundred Dollars ($500.00) or an amount equal to one percent (1%) of the unpaid amount, whichever is greater; and the company so failing or neglecting for sixty (60) days shall thereafter be debarred from transacting any business of insurance in this state until the taxes, fees and penalties are fully paid, and the Insurance Commissioner shall revoke the license or certificate of authority granted to the agent or agents of that company to transact business in this state. Provided, that when any such insurance company, copartnership, insurance association, interinsurance exchange, person, insurer, or nonprofit hospital service and indemnity corporation, applies for the first time for a license to do business in Oklahoma, it shall, at the time of making such application, pay a license fee as prescribed by Section 1425 of this title, and, on or before the first day of March, following, pay the premium tax, membership, application, policy, registration, and agent appointment fees, as hereinbefore provided. Such license fee, tax and membership, application, policy, registration, and appointment fees shall be in lieu of all other state taxes or fees, except those taxes and fees provided for in the Insurance Code, and the taxes and fees of any subdivision or municipality of the state, except ad valorem taxes and the tax required to be paid pursuant to Section 50001 of Title 68 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">C. Any health maintenance organization failing to file premium tax returns and payments promptly and correctly shall forfeit and pay to the Insurance Commissioner, in addition to the amount of the taxes, the sum of Five Hundred Dollars ($500.00) or an amount equal to one percent (1%) of the unpaid amount, whichever is greater. Any health maintenance organization failing or neglecting to pay the tax and penalty shall be debarred from operating in this state and the Insurance Commissioner shall revoke the license of the health maintenance organization, until such taxes and penalties are fully paid.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 236, &sect; 624. Amended by Laws 1965, c. 60, &sect; 10, eff. July 1, 1965; Laws 1965, c. 194, &sect; 1; Laws 1979, c. 39, &sect; 1, eff. July 1, 1979; Laws 1982, c. 138, &sect; 1, emerg. eff. April 9, 1982; Laws 1985, c. 179, &sect; 1, emerg. eff. June 21, 1985; Laws 1986, c. 251, &sect; 8, eff. Nov. 1, 1986; Laws 1987, c. 175, &sect; 5, eff. Nov. 1, 1987; Laws 1988, c. 83, &sect; 5, emerg. eff. March 25, 1988; Laws 1989, c. 227, &sect; 1; Laws 1989, c. 373, &sect; 17, operative July 1, 1989; Laws 1990, c. 227, &sect; 1, emerg. eff. May 18, 1990; Laws 1997, c. 418, &sect; 28, eff. Nov. 1, 1997; Laws 2001, c. 363, &sect; 6, eff. July 1, 2001; Laws 2003, c. 197, &sect; 55, eff. Nov. 1, 2003; Laws 2010, S.J.R. No. 61, &sect; 20.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36624.1. Tax credit for taxes paid by domestic insurer in foreign state.&nbsp;</span></p> <p><span class="cls0">If, by the laws of any state other than this state, or by the action of any public official of another state, any insurer or company, as defined in Section 624 of this Code, organized or domiciled in this state, shall be required to pay taxes for the privilege of doing business in such other state, and such amounts are imposed or assessed so that the taxes which are or would be imposed against Oklahoma domestic insurance companies are greater than those taxes required of insurers organized or domiciled in such other states, to the extent such amounts are legally due to such other states, an insurer or company organized or domiciled in this state may claim a credit against the tax payable pursuant to this article for any calendar year prior to 1989 of a sum not to exceed one hundred percent (100%) of such amount. Provided, for the tax attributed to premiums collected prior to July 1, 1988, the credit shall not be greater than the tax payable for such premiums; for the tax attributed to premiums collected on or after July 1, 1988 through December 31, 1988, the credit authorized by this section and the investment credit authorized by Section 625 of this title shall not reduce the tax payable for such premiums to less than one percent (1%).&nbsp;</span></p> <p><span class="cls0">Beginning with the taxes payable for calendar year 1989, the premium tax levied by Section 624 of this title shall not be reduced by the credit provided for in this section.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1985, c. 328, &sect; 6, emerg. eff. July 29, 1985. Amended by Laws 1988, c. 83, &sect; 6, emerg. eff. March 25, 1988. &nbsp;</span></p> <p><span class="cls0">&sect;36-624.2. Refund of erroneously paid premium tax &ndash; Filing &ndash; Demand for hearing.&nbsp;</span></p> <p><span class="cls0">A. Any taxpayer who has paid to the State of Oklahoma, through error of fact, or computation, or misinterpretation of law, any premium tax collected by the Oklahoma Insurance Commissioner may, as hereinafter provided, be refunded the amount of such tax so erroneously paid, without interest.&nbsp;</span></p> <p><span class="cls0">B. Any taxpayer who has so paid any such premium tax may, within three (3) years from the date of payment thereof, file with the Insurance Commissioner a verified claim for refund of such tax so erroneously paid. The Insurance Commissioner may accept an amended premium report or return as a verified claim for refund if the amended report or return establishes a liability less than the original report or return previously filed.&nbsp;</span></p> <p><span class="cls0">C. Said claim so filed with the Insurance Commissioner, except for an amended report or return, shall specify the name of the taxpayer, certificate of authority or license number of the taxpayer, the time when and period for which said premium tax was paid, the nature and kind of premium tax so paid, the amount of the premium tax which said taxpayer claimed was erroneously paid, the grounds upon which a refund is sought, and such other information or data relative to such payment as may be necessary to an adjustment thereof by the Insurance Commissioner. It shall be the duty of the Insurance Commissioner to determine what amount of refund, if any, is due as soon as practicable, but no later than ninety (90) days after such claim has been filed, and advise the taxpayer about the correctness of the taxpayer's claim, and the claim for refund shall be approved or denied by written notice to the taxpayer.&nbsp;</span></p> <p><span class="cls0">D. If the claim for refund is denied, the taxpayer may file a demand for hearing with the Insurance Commissioner. The demand for hearing must be filed on or before the thirtieth day after the date the notice of denial was mailed. If the taxpayer fails to file a demand for hearing, the claim for refund shall be barred.&nbsp;</span></p> <p><span class="cls0">E. Upon the taxpayer's timely filing of a demand for hearing, the Insurance Commissioner shall set a date for hearing upon the claim for refund which date shall not be later than sixty (60) days from the date the demand for hearing was mailed. The taxpayer shall be notified of the time and place of the hearing. The hearing may be held after the sixty-day period provided by this subsection upon agreement of the taxpayer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 124, &sect; 1, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-624.3. Refund of adverse economically targeted and home office credit deductions.&nbsp;</span></p> <p><span class="cls0">A. As used in this section:&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Economically targeted credits&rdquo; means any credit against the insurance premium tax other than the home office credits;&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Home office credits&rdquo; means the credits against insurance premium tax authorized pursuant to Section 625.1 of this title;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Insurance premium tax&rdquo; means those levies imposed pursuant to Sections 624 and 628 of this title; and&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Insurance premium tax liabilities&rdquo; means the total liability of any insurance company created by the insurance premium tax.&nbsp;</span></p> <p><span class="cls0">B. Any taxpayer adversely affected by a requirement of the Oklahoma Insurance Department for deducting home office credits after the deduction of economically targeted credits in computation of the taxpayer&rsquo;s insurance premium tax liabilities for the period January 2003, through December 2006, shall be granted a refund, pursuant to the provisions of Section 624.2 of this title, for the difference between the insurance premium tax liability as it would have been computed had the home office credit been deducted prior to economically targeted credits and the insurance premium tax liability as it was actually computed for such periods.&nbsp;</span></p> <p><span class="cls0">C. The provisions of this section shall be deemed sufficient grounds for the granting of a refund claim pursuant to subsection C of Section 624.2 of this title.&nbsp;</span></p> <p><span class="cls0">D. No refund otherwise payable pursuant to the provisions of this section shall be paid to a claimant prior to July 1, 2007.&nbsp;</span></p> <p><span class="cls0">E. Refunds paid on or after July 1, 2007, pursuant to the provisions of this section shall only be paid from those insurance premium taxes and fees that would be apportioned to the General Revenue Fund of the State Treasury. No refund otherwise payable pursuant to the provisions of this section shall be paid from insurance premium taxes or fees that would be apportioned to the Oklahoma Firefighters Pension and Retirement Fund, the Oklahoma Police Pension and Retirement System or the Law Enforcement Retirement Fund.&nbsp;</span></p> <p><span class="cls0">F. Any and all premium tax credits to be utilized or recovered in a subsequent year are fully admitted as an asset to the insurer owning or generating said credits.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2005, c. 381, &sect; 3, eff. July 1, 2006. Amended by Laws 2006, 2nd Ex. Sess., c. 44, &sect; 1, eff. July 1, 2007.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36625. Credit against tax by investment in Oklahoma securities.&nbsp;</span></p> <p><span class="cls0">A. If the annual statement of any insurance company or other entity taxed pursuant to the provisions of Section 624 of this title covering the period of time from January 1, 1988 through June 30, 1988, shows it to have investments at the close of said period of time in Oklahoma securities, as hereinafter defined, of as much as two percent (2%) but less than twelve percent (12%) of its admitted assets, it will be entitled to a credit on the premium tax levied on premiums collected during said period of time by paragraph 2 of Section 624 of this article so as to reduce the same to a tax of two and threefourths percent (2 3/4%); if said investments are as much as twelve percent (12%) but less than fourteen percent (14%) of said assets its annual premium tax shall be reduced to a tax of two and onehalf percent (2 1/2%); if said investments are as much as fourteen percent (14%) but less than sixteen percent (16%) of said assets its annual premium tax shall be reduced to a tax of two and onefourth percent (2 1/4%); if said investments are as much as sixteen percent (16%) but less than eighteen percent (18%) of said assets its annual premium tax shall be reduced to a tax of two percent (2%); if said investments are as much as eighteen percent (18%) but less than twenty percent (20%) of said assets its annual premium tax shall be reduced to a tax of one and threefourths percent (1 3/4%); if said investments are as much as twenty percent (20%) but less than twentytwo percent (22%) of said assets its annual premium tax shall be reduced to a tax of one and onehalf percent (1 1/2%); if said investments are as much as twentytwo percent (22%) but less than twentyfour percent (24%) of said assets its annual premium tax shall be reduced to a tax of one and onefourth percent (1 1/4%); if said investments are as much as twentyfour percent (24%) but less than twentysix percent (26%) of said assets its annual premium tax shall be reduced to a tax of one percent (1%); if said investments are as much as twentysix percent (26%) percent but less than twentyeight percent (28%) of said assets its annual premium tax shall be reduced to a tax of threefourths of one percent (3/4 of 1%); if said investments are as much as twentyeight percent (28%) but less than thirty percent (30%) of said assets its annual premium tax shall be reduced to a tax of onehalf of one percent (1/2 of 1%); if said investments are as much as thirty percent (30%) of said assets its annual premium tax shall be reduced to no percent (0%).&nbsp;</span></p> <p><span class="cls0">B. If the annual statement of any insurance company or other entity taxed pursuant to the provisions of Section 624 of this title covering calendar year 1988 shows it to have investments in Oklahoma securities, as hereinafter defined, for the period of time beginning July 1, 1988 through December 31, 1988, of as much as two percent (2%) but less than twelve percent (12%) of its admitted assets, it will be entitled to a credit on the premium tax levied by paragraph 2 of Section 624 of this article so as to reduce the same to a tax of two and threefourths percent (2 3/4%); if said investments are as much as twelve percent (12%) but less than fourteen percent (14%) of said assets its annual premium tax shall be reduced to a tax of two and onehalf percent (2 1/2%); if said investments are as much as fourteen percent (14%) but less than sixteen percent (16%) of said assets its annual premium tax shall be reduced to a tax of two and onefourth percent (2 1/4%); if said investments are as much as sixteen percent (16%) but less than eighteen percent (18%) of said assets its annual premium tax shall be reduced to a tax of two percent (2%); if said investments are as much as eighteen percent (18%) but less than twenty percent (20%) of said assets its annual premium tax shall be reduced to a tax of one and threefourths percent (1 3/4%); if said investments are as much as twenty percent (20%) but less than twentytwo percent (22%) of said assets its annual premium tax shall be reduced to a tax of one and onehalf percent (1 1/2%); if said investments are as much as twentytwo percent (22%) but less than twentyfour percent (24%) of said assets its annual premium tax shall be reduced to a tax of one and onefourth percent (1 1/4%); if said investments are as much as twentyfour percent (24%) of said assets its annual premium tax shall be reduced to a tax of one percent (1%). The credits authorized by this subsection and the credits authorized by Section 624.1 of this title shall not reduce the premium tax rate for premiums collected on or after July 1, 1988 through December 31, 1988, of an insurance company or other entity subject to said tax to less than one percent (1%).&nbsp;</span></p> <p><span class="cls0">C. Beginning with the taxes payable for calendar year 1989, the premium tax levied by Section 624 of this title shall not be reduced by the credits for investment of assets provided for in this section.&nbsp;</span></p> <p><span class="cls0">D. Oklahoma securities as used in this section shall mean real estate in this state, bonds of the State of Oklahoma, bonds or interestbearing warrants of any county, city, town, school district or municipality or subdivision of the State of Oklahoma, notes or bonds secured by mortgages or other liens on real estate located in the State of Oklahoma, cash deposits in regularly established national or state banks, Federal Savings and Loan Associations, Federal Savings Banks, or any institution insured by either the Federal Deposit Insurance Corporation or Federal Savings and Loan Insurance Corporation, in this state on the basis of the average monthly deposits throughout the calendar year, policy loans secured by the legal reserve on policies insuring residents of the State of Oklahoma, and any other Oklahoma property or securities in which by the laws of the State of Oklahoma such insurance companies may invest their funds.&nbsp;</span></p> <p><span class="cls0">Provided, that if any insurance company, copartnership, association, interinsurance exchange, person, insurer, nonprofit hospital service and medical indemnity corporation, or health maintenance organization secures such a credit prior to such a holding, it shall, within ninety (90) days after the mailing thereto by the Insurance Commissioner of a registered notice of said holding and the amount of said credit, pay said amount to the Insurance Commissioner, and if it fails to do so it shall be the duty of the Attorney General to institute proceedings in the name of the State of Oklahoma on the relation of the Insurance Commissioner in a court of competent jurisdiction to collect said amount.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Amended by Laws 1985, c. 179, &sect; 2, emerg. eff. June 21, 1985; Laws 1988, c. 83, &sect; 7, emerg. eff. March 25, 1988. &nbsp;</span></p> <p><span class="cls0">&sect;36-625.1. Premium tax credit.&nbsp;</span></p> <p><span class="cls0">A. A foreign or alien insurer which is subject to the tax imposed by Section 624 of this title shall be entitled to a credit against said tax actually paid to and placed in the General Revenue Fund of the state, not including any of said tax monies placed in pension funds and not including any of said tax monies placed in escrow, if, during the year for which the tax is being assessed, the insurer or its affiliate maintained a regional home office in this state in a building owned or leased by the insurer. To receive a credit against the tax imposed for the year in which the regional home office was established, said office must have been maintained continuously from on or before August 1 of that year through the last day of the calendar year. For succeeding years, an insurer or its affiliate shall have maintained the regional home office continuously from the first day of the calendar year for which the tax is imposed through the last day of that calendar year. The Home Office Credit shall be calculated as follows:&nbsp;</span></p> <p><span class="cls0">1. Until June 30, 2010, the credit shall be equal to the following percentages of the amount due after the credits authorized by Sections 624.1 and 625 of this title have been deducted:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;fifteen percent (15%), if there are more than two hundred full-time, year-round Oklahoma employees, but less than three hundred full-time, year-round Oklahoma employees,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;twenty-five percent (25%), if there are more than three hundred full-time, year-round Oklahoma employees, but less than four hundred full-time, year-round Oklahoma employees,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;thirty-five percent (35%), if there are more than four hundred full-time, year-round Oklahoma employees, but less than five hundred full-time, year-round Oklahoma employees, or&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;fifty percent (50%), if there are five hundred or more full-time, year-round Oklahoma employees; and&nbsp;</span></p> <p><span class="cls0">2. Beginning July 1, 2010, in the calculation of the credit, the amount to be apportioned to the Oklahoma Firefighters Pension and Retirement Fund, the Oklahoma Police Pension and Retirement System and the Law Enforcement Retirement Fund shall be applied prior to the calculation of the credit. The amount of the credit shall be derived from amounts remaining after the apportionment to the Oklahoma Firefighters Pension and Retirement Fund, the Oklahoma Police Pension and Retirement System and the Law Enforcement Retirement Fund. The credit shall be calculated by first applying a &ldquo;Home Office Credit Allotment Rate&rdquo; of forty-seven percent (47%) to the gross premium tax owed by the insurer and then determining the allowable credit by applying the following percentages of the amount due after the credits authorized by Sections 624.1 and 625 of this title have been deducted:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;fifteen percent (15%), if there are more than two hundred full-time, year-round Oklahoma employees, but less than three hundred full-time, year-round Oklahoma employees,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;twenty-five percent (25%), if there are more than three hundred full-time, year-round Oklahoma employees, but less than four hundred full-time, year-round Oklahoma employees,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;thirty-five percent (35%), if there are more than four hundred full-time, year-round Oklahoma employees, but less than five hundred full-time, year-round Oklahoma employees, or&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;fifty percent (50%), if there are five hundred or more full-time, year-round Oklahoma employees.&nbsp;</span></p> <p><span class="cls0">B. A domestic insurer with four hundred or more full-time, year-round Oklahoma employees which is subject to the tax imposed by Section 624 of this title shall be entitled to a credit against said tax actually paid to and placed in the General Revenue Fund of the state, not including any of said tax monies placed in pension funds and not including any of said tax monies placed in escrow, if, during the year previous to the year for which the tax is being assessed, the insurer or its affiliate maintained a regional home office in this state in a building owned or leased by the insurer and during the year for which the tax is being assessed, the insurer establishes its home office in this state in a building owned or leased by the insurer. To receive a credit against the tax imposed for the year in which the home office was established, said office must have been maintained continuously from on or before August 1 of that year through the last day of the calendar year. For succeeding years, an insurer shall have maintained the home office continuously from the first day of the calendar year for which the tax is imposed through the last day of that calendar year. Insurers who take action before August 1, 2000, to establish their home office in this state shall be entitled to a credit against the tax imposed on or after January 1, 2001, which shall be in addition to the credit the insurer is entitled to for that year. The Home Office Credit shall be calculated as follows:&nbsp;</span></p> <p><span class="cls0">1. Until June 30, 2010, the credit shall be equal to the following percentages of the amount due after the credits authorized by Sections 624.1 and 625 of this title have been deducted:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;thirty-five percent (35%), if there are more than four hundred full-time, year-round Oklahoma employees, but less than five hundred full-time, year-round Oklahoma employees, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;fifty percent (50%), if there are five hundred or more full-time, year-round Oklahoma employees; and&nbsp;</span></p> <p><span class="cls0">2. Beginning July 1, 2010, in the calculation of the credit, the amount to be apportioned to the Oklahoma Firefighters Pension and Retirement Fund, the Oklahoma Police Pension and Retirement System and the Law Enforcement Retirement Fund shall be applied prior to the calculation of the credit. The amount of the credit shall be derived from amounts remaining after the apportionment to the Oklahoma Firefighters Pension and Retirement Fund, the Oklahoma Police Pension and Retirement System and the Law Enforcement Retirement Fund. The credit shall be calculated by first applying a &ldquo;Home Office Credit Allotment Rate&rdquo; of forty-seven percent (47%) to the gross premium tax owed by the insurer and then determining the allowable credit by applying the following percentages of the amount due after the credits authorized by Sections 624.1 and 625 of this title have been deducted:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;thirty-five percent (35%), if there are more than four hundred full-time, year-round Oklahoma employees, but less than five hundred full-time, year-round Oklahoma employees, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;fifty percent (50%), if there are five hundred or more full-time, year-round Oklahoma employees.&nbsp;</span></p> <p><span class="cls0">C. A domestic insurer which is subject to the tax imposed by Section 624 of this title shall be entitled to a credit against said tax actually paid to and placed in the General Revenue Fund of the state, not including any of said tax monies placed in pension funds and not including any of said tax monies placed in escrow, if, during the year for which the tax is being assessed, the insurer maintained a regional home office in at least five or more counties in this state in buildings owned or leased by the insurer. To receive a credit against the tax imposed for the year in which the regional home offices were established, said offices must have been maintained continuously from on or before August 1 of that year through the last day of the calendar year. For succeeding years, an insurer shall have maintained the regional home offices continuously from the first day of the calendar year for which the tax is imposed through the last day of that calendar year. The Home Office Credit shall be calculated as follows:&nbsp;</span></p> <p><span class="cls0">1. Until June 30, 2010, the credit shall be equal to the percentage of the amount due after the credits authorized by Sections 624.1 and 625 of this title have been deducted as established in subsection A of this section; and&nbsp;</span></p> <p><span class="cls0">2. Beginning July 1, 2010, in the calculation of the credit, the amount to be apportioned to the Oklahoma Firefighters Pension and Retirement Fund, the Oklahoma Police Pension and Retirement System and the Law Enforcement Retirement Fund shall be applied prior to the calculation of the credit. The amount of the credit shall be derived from amounts remaining after the apportionment to the Oklahoma Firefighters Pension and Retirement Fund, the Oklahoma Police Pension and Retirement System and the Law Enforcement Retirement Fund. The credit shall be calculated by first applying a &ldquo;Home Office Credit Allotment Rate&rdquo; of forty-seven percent (47%) to the gross premium tax owed by the insurer and then determining the allowable credit by applying the percentage of the amount due after the credits authorized by Sections 624.1 and 625 of this title have been deducted as established in subsection A of this section.&nbsp;</span></p> <p><span class="cls0">D. Proof that an insurer qualifies for the credit authorized by this section shall be on forms prescribed by the Insurance Commissioner and shall be submitted to the Commissioner annually with the report which is filed pursuant to Section 624 of the Insurance Code.&nbsp;</span></p> <p><span class="cls0">E. The credit provided for in subsections A, B and C of this section shall be based on the total number of Oklahoma employees in the regional or home office when a group of insurers which are under common management and control maintain a regional home office or home office in this state in a building owned or leased by the group of insurers. The credit provided for in subsections A, B and C of this section may be allocated among the insurance company and the insurance company affiliates at the discretion of the insurance company on a per-insurance-company basis.&nbsp;</span></p> <p><span class="cls0">F. As used in this section:&nbsp;</span></p> <p><span class="cls0">1. "Regional home office" means an office transacting insurance, as defined in Section 105 of this title, and performing insurance company operations, which is defined as one or more or any combination of the following functions and services performed in connection with the development, sale, and administration of products giving rise to receipts subject to a premium tax on domestic and foreign insurance companies, or domestic or foreign health care insurance corporations: actuarial, medical, legal, investments, accounting, auditing, underwriting, policy issuance, information, policyholder services, premium collection, claims, advertising and publications, public relations, human resources, marketing, sales office staff, training of sales and service personnel, and clerical, managerial, and other support for any such functions or services;&nbsp;</span></p> <p><span class="cls0">2. "Common management and control" means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of an insurer, whether through the ownership of voting securities, by contract, or otherwise, unless the power is executed by a person acting in an official capacity, performing duties imposed and exercising authority granted because of the person's position as an officer or employee of the insurer. Control shall be presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote, or holds proxies representing twenty-five percent (25%) or more of the voting securities of the insurer;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Oklahoma employees&rdquo; means persons who are employed in Oklahoma after January 1, 2000, and who are common law employees of an insurance company or its affiliate. Oklahoma employees do not include independent contractors or any persons to the extent that the compensation of that person is based on commissions;&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Insurance company&rdquo; means any entity subject to a premium tax on domestic and foreign insurance companies, or domestic or foreign health care insurance corporations, including the attorney-in-fact authorized by and acting for the subscribers of a reciprocal insurer or inter-insurance exchange under powers of attorney. A reciprocal and its attorney-in-fact shall be a single entity; and&nbsp;</span></p> <p><span class="cls0">5. &ldquo;Home office&rdquo; means the executive offices of an insurance company which is domiciled in this state.&nbsp;</span></p> <p><span class="cls0">G. Each insurer or insurance group requesting a credit under this section shall certify by affidavit, approved as to form by the Commissioner, that the insurer has met all of the qualifications required by this section and is authorized to a credit against the premium tax which actually shall be paid to, and placed in the General Revenue Fund of the state, exclusive of any amounts of the tax which shall be credited to pension funds pursuant to law and exclusive of any amounts which shall be placed into escrow. The Commissioner may do an examination for the sole purpose of certifying that all requirements of this section are being met by the insurer requesting to obtain any credits against premium tax.&nbsp;</span></p> <p><span class="cls0">H. For the fiscal year beginning July 1, 2006, and for each fiscal year thereafter, and notwithstanding any other provisions of Title 36 of the Oklahoma Statutes or any other provision of law governing the order in which the credit authorized by this section is to be deducted from the liability of the company claiming such credit to the contrary, the credit authorized by this section shall be deducted from the insurance premium tax liability of the company claiming such credit prior to the deduction of any other credits that may be claimed against such liability.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1987, c. 137, &sect; 1, eff. Nov. 1, 1987. Amended by Laws 2000, c. 346, &sect; 1, eff. Jan. 1, 2001; Laws 2005, c. 381, &sect; 2, eff. July 1, 2006; Laws 2008, c. 344, &sect; 1, eff. Nov. 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36625.2. Premium tax credit Applicable insurers.&nbsp;</span></p> <p><span class="cls0">A. The tax credits set forth in Section 1 of this act shall apply to insurers who take action after November 1, 1987, to:&nbsp;</span></p> <p><span class="cls0">1. Establish new regional home offices; or&nbsp;</span></p> <p><span class="cls0">2. Expand existing regional home offices, and hire new employees.&nbsp;</span></p> <p><span class="cls0">B. An insurer in either category of the requirements of paragraph A of this section must also meet the hiring minimum requirements for the applicable tax credit bracket in Section 1 of this act.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1987, c. 137, &sect; 2, eff. Nov. 1, 1987. &nbsp;</span></p> <p><span class="cls0">&sect;36-625.3. Insurance companies - Home office - Tax credit.&nbsp;</span></p> <p><span class="cls0">An insurance company that has operated a regional home office in this state that has qualified for the tax credit provided for in Section 625.1 of Title 36 of the Oklahoma Statutes and that redomiciles and moves its home office to this state shall continue to receive such tax credit under the terms for which is was originally allowed.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2000, c. 315, &sect; 10, eff. July 1, 2000.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-625.4. Credit against premium tax.&nbsp;</span></p> <p><span class="cls0">A. One hundred percent (100%) of any assessment paid by an insurer under the Oklahoma Property and Casualty Insurance Guaranty Association Act shall be allowed to that insurer as a credit against its premium tax levied under Section 624 of Title 36 of the Oklahoma Statutes. The tax credit referred to in this section shall be allowed at a rate of ten percent (10%) per year for ten (10) successive years following the date of assessment and, at the option of the insurer, may be taken over an additional number of years. The balance of any tax credit not claimed in a particular year may be reflected in the books and records of the insurer as an admitted asset of the insurer for all purposes.&nbsp;</span></p> <p><span class="cls0">B. Available credit against premium tax allowed under subsection A of this section may be transferred or assigned among or between insurers if:&nbsp;</span></p> <p><span class="cls0">1. A merger, acquisition, or total assumption of reinsurance among or between the insurers occurs; or&nbsp;</span></p> <p><span class="cls0">2. The Insurance Commissioner by order approves the transfer or assignment.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2002, c. 307, &sect; 11, eff. Nov. 1, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36626. Collection proceedings.&nbsp;</span></p> <p><span class="cls0">If any entity such as is referred to in this article fails to pay the annual premium tax levied by Section 624 of this Code, it shall be the duty of the Attorney General to institute proceedings in the name of the State of Oklahoma on the relation of the Insurance Commissioner in a court of competent jurisdiction to collect said amount.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Amended by Laws 1985, c. 179, &sect; 3, emerg. eff. June 21, 1985. &nbsp;</span></p> <p><span class="cls0">&sect;36-627. Repealed by Laws 2005, c. 129, &sect; 26, eff. Nov. 1, 2005.&nbsp;</span></p> <p><span class="cls0">&sect;36-628. Retaliation.&nbsp;</span></p> <p><span class="cls0">When by or pursuant to the laws of any other state or foreign country any premium or income or other taxes, or any fees, fines, penalties, licenses, deposit requirements or other material obligations, prohibitions or restrictions are imposed upon Oklahoma insurers doing business, or that might seek to do business in such other state or country, which in the aggregate are in excess of such taxes, fees, fines, penalties, licenses, deposit requirements or other obligations, prohibitions or restrictions directly imposed upon similar insurers of such other state or foreign country under the statutes of this state, so long as such laws continue in force or are so applied, the same obligations, prohibitions and restrictions of whatever kind shall be imposed upon similar insurers of such other state or foreign country doing business in Oklahoma. All insurance companies of other nations shall be held to the same obligations and prohibitions that are imposed by the state where they have elected to make their deposit and establish their principal agency in the United States. Any tax, license or other obligation imposed by any city, county or other political subdivision of a state or foreign country on Oklahoma insurers or their agents shall be deemed to be imposed by such state or foreign country within the meaning of this section. The provisions of this section shall not apply to ad valorem taxes on real or personal property or to personal income taxes.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 239, &sect; 628, operative July 1, 1957. Amended by Laws 1990, c. 258, &sect; 80, operative July 1, 1990; Laws 2001, c. 363, &sect; 7, eff. July 1, 2001; Laws 2010, c. 222, &sect; 6, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 3; Laws 2011, c. 360, &sect; 3.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-629. Estimate and prepayment of premium tax - Crediting.&nbsp;</span></p> <p><span class="cls0">A. Every insurance company transacting business in this state whose premium tax, paid with respect to the previous calendar year's premiums, was One Thousand Dollars ($1,000.00) or more, shall make an estimate each year as provided herein and remit with each estimate a prepayment of its annual premium tax for the current calendar year equal to one-fourth (1/4) of its annual premium tax paid with respect to the previous calendar year's premiums. Estimates, with remittance, shall be made on or before April 15, June 15, September 15 and December 15, respectively.&nbsp;</span></p> <p><span class="cls0">B. All sums prepaid by an insurance company shall be allowed as credits against its annual return for premium tax payable on or before the first day of March. If sums prepaid exceed the insurance company&rsquo;s annual premium tax payable on or before the first day of March, the excess shall be refunded or shall be allowed as credits against subsequent prepayments of the tax as the insurance company shall elect on the annual return for premium tax filed for the year by the insurance company with respect to which such excess prepayments were made. Provided, in the case of an insurance company which has made prepayments of its premium tax in excess of its annual premium tax payable, the part of the excess prepayments as has not been credited against subsequent prepayments of the tax shall be refunded to the insurance company upon application within one hundred eighty (180) days after application is made.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1971, c. 191, &sect; 1, emerg. eff. June 4, 1971. Amended by Laws 1972, c. 59, &sect; 1, emerg. eff. March 25, 1972; Laws 1982, c. 164, &sect; 1, operative July 1, 1982; Laws 1988, c. 83, &sect; 8, emerg. eff. March 25, 1988; Laws 1997, c. 418, &sect; 29, eff. Nov. 1, 1997; Laws 2004, c. 274, &sect; 4, eff. July 1, 2004; Laws 2005, c. 129, &sect; 4, eff. Nov. 1, 2005.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-630. Failure to make payments timely - Penalties.&nbsp;</span></p> <p><span class="cls0">Failure to make such payments timely shall subject the insurance company to a penalty of ten percent (10%) of the tax due and said tax and penalty shall be further subject to interest at the rate of six percent (6%) per annum, from the date said payment should have been paid, until the tax, penalty and interest are paid.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1971, c. 191, &sect; 2, emerg. eff. June 4, 1971. Amended by Laws 2004, c. 274, &sect; 5, eff. July 1, 2004.&nbsp;</span></p> <p><span class="cls0">&sect;36-631. Deposit of premium tax - Payments to Medicaid Contingency Revolving Fund - Transfer of funds received from tax protest litigation.&nbsp;</span></p> <p><span class="cls0">A. Said premium tax as collected shall be deposited by the thirtieth day of the month of receipt to the credit of the General Revenue Fund subject only to the allocations thereof as otherwise provided by law.&nbsp;</span></p> <p><span class="cls0">B. That portion of premium tax assessed on the premiums of Medicaid recipients collected from the University of Oklahoma Managed Care Plan sponsored by the University of Oklahoma Health Sciences Center and from qualified health plans that contract with the Oklahoma Health Care Authority to provide managed care to participants in the State Medicaid program, as provided in Section 624 of this title, shall be paid by the thirtieth day of the month of receipt to the credit of the Medicaid Contingency Revolving Fund, created in Section 1010.8 of Title 56 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1971, c. 191, &sect; 3, emerg. eff. June 4, 1971. Amended by Laws 1987, c. 203, &sect; 107, operative July 1, 1987; Laws 1988, c. 127, &sect; 2, emerg. eff. April 12, 1988; Laws 1988, c. 204, &sect; 1, operative July 1, 1988; Laws 1995, c. 331, &sect; 1, eff. Nov. 1, 1995; Laws 1996, c. 302, &sect; 1, eff. July 1, 1996.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-632. Certain entities subject to jurisdiction of Insurance Commissioner and Oklahoma Insurance Code - Exemptions.&nbsp;</span></p> <p><span class="cls0">A. Unless otherwise provided for by law or exempted by the provisions of this section, any person or other entity which provides coverage in this state for medical, surgical, chiropractic, physical therapy, speech pathology, audiology, professional mental health, dental, hospital, or ophthalmologic expenses, whether coverage is by direct payment, reimbursement, or other means, shall be presumed to be subject to the jurisdiction of the Insurance Commissioner unless the person or other entity shows that while providing coverage the person or entity is subject to the jurisdiction of another agency of this or another state, any subdivision of this state, or the federal government, or provides a plan of selfinsurance or other employee welfare benefit program for an individual employer or labor union maintained pursuant to a collective bargaining agreement or other arrangement which provides for health care services solely for its employees or members and their dependents.&nbsp;</span></p> <p><span class="cls0">B. A person or entity may show that it is subject to the jurisdiction of another agency of this or another state, any subdivision of this state, or the federal government by providing to the Insurance Commissioner the certificate, license, or other document issued by the other governmental agency which permits or qualifies the person or entity to provide those services.&nbsp;</span></p> <p><span class="cls0">C. Any person or entity which is unable to show that it is subject to the jurisdiction of another agency of this or another state, any subdivision of this state, or the federal government, or provides an employee welfare benefit program for an individual employer or labor union as provided for in subsection A of this section, shall submit to an examination by the Insurance Commissioner to determine the organization and solvency of the person or entity, and to determine whether or not the person or entity is in compliance with applicable provisions of the Oklahoma Insurance Code, Section 101 et seq. of this title.&nbsp;</span></p> <p><span class="cls0">D. Any person or entity unable to show that it is subject to the jurisdiction of another agency of this or another state, any subdivision of this state, or the federal government, or provides an employee welfare benefit program for an individual employer or labor union as provided for in subsection A of this section, shall be subject to all appropriate provisions of the Oklahoma Insurance Code regarding the conduct of its business.&nbsp;</span></p> <p><span class="cls0">1. Any agent, broker, administrator, or other person or company which advertises, solicits, negotiates, procures, sells, renews, continues, or administers coverage in this state which is provided by any person or entity specified in subsection C of this section for expenses specified in subsection A of this section shall advise any purchaser, prospective purchaser, and covered person of the lack of insurance or other coverage, if the coverage for expenses specified in subsection A of this section is not fully insured or otherwise fully covered by a company authorized to do such business in this state; and&nbsp;</span></p> <p><span class="cls0">2. Any administrator who advertises or administers coverage in this state which is provided by any person or entity specified in subsection C of this section for expenses specified in subsection A of this section shall advise any agent, broker, or other person or company which advertises, solicits, negotiates, sells, procures, renews, or continues said coverage of the elements of the coverage including the amount of stoploss insurance in effect.&nbsp;</span></p> <p><span class="cls0">E. 1. Those entities which are not licensed insurers in this state, other than a hospital service and medical indemnity corporation as authorized in Section 2601 et seq. of this title, shall place the following statement in conspicuous boldface type on the front page of their policy or certificate: "State insurance insolvency guaranty funds are not available for your use in the event of insolvency or liquidation of this company"; and&nbsp;</span></p> <p><span class="cls0">2. Those entities which are not licensed insurers, or not subject to the jurisdiction of the Insurance Commissioner or any other state agency, shall place the following statement in conspicuous boldface type on the front page of their policy, plan or certificate: "This policy, plan or certificate and this entity are not subject to the jurisdiction of the Oklahoma State Insurance Commissioner".&nbsp;</span></p> <p><span class="cls0">Added by Laws 1984, c. 42, &sect; 1, eff. Nov. 1, 1984. Amended by Laws 1987, c. 172, &sect; 1, eff. Nov. 1, 1987; Laws 1997, c. 418, &sect; 30, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-633. MEWA defined - Information relating to administrative services contracts.&nbsp;</span></p> <p><span class="cls0">A. As used in this act, the term "Multiple Employer Welfare Arrangement" or "MEWA" means that term as defined in Section 3 of the Employee Retirement Income Security Act of 1974, 29 U.S.C., Section 1002(40)(A), as amended, that meets either or both of the following criteria:&nbsp;</span></p> <p><span class="cls0">1. One or more of the employer members of the MEWA is either domiciled in this state or has its principal place of business or principal administrative office in this state; or&nbsp;</span></p> <p><span class="cls0">2. The MEWA solicits an employer that is domiciled in this state or that has its principal place of business or principal administrative office in this state.&nbsp;</span></p> <p><span class="cls0">B. Each insurer licensed to do business in this state, including any corporation organized under the provisions of Article 26 of Title 36 of the Oklahoma Statutes, that administers a MEWA shall provide the Insurance Commissioner with such information regarding the insurer's administrative services contract or contracts with such MEWA or MEWAs that the Commissioner may reasonably require.&nbsp;</span></p> <p><span class="cls0">C. A MEWA shall be administered only by a licensed insurer or a licensed third party administrator.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1992, c. 374, &sect; 1, eff. Jan. 1, 1993.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-634. Valid license required - Exempt entities.&nbsp;</span></p> <p><span class="cls0">A. It is unlawful to operate, maintain or establish a MEWA unless the MEWA has a valid license issued by the Insurance Commissioner. Any MEWA operating in this state without a valid license is an unauthorized insurer.&nbsp;</span></p> <p><span class="cls0">B. This act shall not apply to:&nbsp;</span></p> <p><span class="cls0">1. A MEWA that offers or provides benefits that are fully insured by an authorized insurer;&nbsp;</span></p> <p><span class="cls0">2. A MEWA that is exempt from state insurance regulation in accordance with the Employee Retirement Income Security Act of 1974 (ERISA) (Public Law 43-406);&nbsp;</span></p> <p><span class="cls0">3. Any plan that has no more than two employer members which share substantial common support other than income generated by their respective similar business classification;&nbsp;</span></p> <p><span class="cls0">4. A plan that has no more than two employer members, which together have a combined net worth of more than Five Million Dollars ($5,000,000.00) and each of such member employers participated in the continuous sponsorship and maintenance of such MEWA for the benefit of their employees for a period of more than ten (10) years next preceding the effective date of this act;&nbsp;</span></p> <p><span class="cls0">5. A MEWA which has been in existence and has provided health insurance for at least five (5) years prior to January 1, 1993, and which was established by a trade, industry or professional association of employers that has a constitution or by-laws, that has been organized and maintained in good faith for at least thirty (30) continuous years prior to January 1, 1993, and its members are persons, firms or corporations qualified to print legal notices pursuant to Section 106 of Title 25 of the Oklahoma Statutes; or&nbsp;</span></p> <p><span class="cls0">6. A nonprofit professional trade association pursuant to Section 501(c)(3) of the Internal Revenue Code, 26 U.S.C., Section 501(c)(3), which has maintained either a self-funded plan or a fully insured plan of coverage for the payment of expenses to or for members of the association for a period of ten (10) or more consecutive years and which coverage is provided to at least five hundred covered participants to establish and maintain a self-funded plan.&nbsp;</span></p> <p><span class="cls0">C. Any entity which claims to be exempt from state regulation pursuant to subsection B of this section shall provide to the Commissioner strict proof establishing such exemption.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1992, c. 374, &sect; 2, eff. Jan. 1, 1993. Amended by Laws 2004, c. 416, &sect; 1, emerg. eff. June 4, 2004.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-635. License eligibility requirements - Filing of contracts.&nbsp;</span></p> <p><span class="cls0">A. To meet the requirements for issuance of a license and to maintain a MEWA, a MEWA either must be:&nbsp;</span></p> <p class="cls2"><span class="cls0">1.&nbsp;&nbsp;a.&nbsp;&nbsp;nonprofit,&nbsp;</span></p> <p class="cls3"><span class="cls0">b.&nbsp;&nbsp;(1)&nbsp;&nbsp;established by a trade association, industry association or professional association of employers or professionals that has a constitution or bylaws and that has been organized and maintained in good faith for a continuous period of five (5) years for purposes other than that of obtaining or providing insurance, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;requires membership in an association described in division (1) of this subparagraph in order to obtain the insurance offered by the MEWA,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;operated pursuant to a trust agreement by a board of trustees that has complete fiscal control over the MEWA and that is responsible for all operations of the MEWA. Except as provided in this paragraph, the trustees must:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;be owners, shareholders, partners, officers, directors, or employees of one or more employers in the MEWA. With the Insurance Commissioner's approval, a person who is not such an owner, shareholder, partner, officer, director, or employee may serve as a trustee if that person possesses the expertise required for such service. A trustee may not be an owner, shareholder, partner, officer or employee of the administrator or service company of the MEWA,&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;have the authority to approve applications of association members for participation in the MEWA, and&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;have the authority to contract with an authorized administrator or service company to administer the operations of the MEWA,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;neither offered nor advertised to the public generally,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;operated in accordance with sound actuarial principles, and&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;offered only after Two Hundred Thousand Dollars ($200,000.00) of cash or federally guaranteed obligations of less than five-year maturity that have a fixed or recoverable principal amount or such other investments as the Commissioner may authorize by rule is titled in such a manner that it may not be traded, sold or otherwise expended without the consent of the Insurance Commissioner; provided, said funds shall be taken into account in determining whether the MEWA is actuarially sound, and evidence of said investment shall be filed with the State Treasurer; or&nbsp;</span></p> <p class="cls2"><span class="cls0">2.&nbsp;&nbsp;a.&nbsp;&nbsp;operated pursuant to a trust agreement for a trust which has its situs in this state, is operated pursuant to a trust agreement by a board of trustees that has complete fiscal control over the MEWA, is responsible for all operations of the MEWA, and which has as one of its trustees a financial institution which is independent of the entity which established the MEWA. Except as provided in this paragraph, the board of trustees must have owners, shareholders, partners, officers, directors or employees of one or more employers in the MEWA. With the Insurance Commissioner&rsquo;s approval, a person who is not such an owner, shareholder, partner, officer, director or employee may serve as a trustee if that person possesses the expertise required for such service. A trustee shall not be an owner, shareholder, partner, officer, director or employee of the administrator or service company of the MEWA,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;operated and administered in a manner that causes all assets of the MEWA to be held in trust until paid either:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;for the benefit of individuals who receive medical, dental or similar benefits from the MEWA, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;for the expenses of the MEWA, such as the fees of the trustee, licensed agents, administrator, service company, and all expenses of complying with the provisions of this act,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;offered only to employers for the benefit of their employees,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;operated in accordance with sound actuarial principles, and&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;offered only after Two Hundred Thousand Dollars ($200,000.00) of cash or federally guaranteed obligations of less than five-year maturity that have a fixed or recoverable principal amount or such other investments as the Commissioner may authorize by rule is titled in such a manner that it may not be traded, sold or otherwise expended without the consent of the Insurance Commissioner; provided, said funds shall be taken into account in determining whether the MEWA is actuarially sound, and evidence of said investment shall be filed with the State Treasurer.&nbsp;</span></p> <p><span class="cls0">B. 1. The MEWA shall issue to each covered employee a policy, contract, certificate, summary plan description, or other evidence of the benefits and coverages provided. The policy, contract, certificate, summary plan description, or other evidence of the benefits, coverages provided, premium rates to be charged and any contracts between the MEWA and any administrator or service company, including any changes to those documents, must be filed with the Oklahoma Insurance Department. The evidence of benefits and coverages provided shall contain, in boldface type on the face page of the policy and the certificate, the following statement: "THE BENEFITS AND COVERAGES DESCRIBED HEREIN ARE PROVIDED THROUGH A TRUST FUND ESTABLISHED BY A GROUP OF EMPLOYERS (name of MEWA). THE TRUST FUND IS NOT SUBJECT TO ANY INSURANCE GUARANTY ASSOCIATION. OTHER RELATED FINANCIAL INFORMATION IS AVAILABLE FROM YOUR EMPLOYER OR FROM THE (name of MEWA). EXCESS INSURANCE IS PROVIDED BY A LICENSED INSURANCE COMPANY TO COVER CERTAIN CLAIMS WHICH EXCEED CERTAIN AMOUNTS. THIS IS THE ONLY SOURCE OF FUNDING FOR THESE BENEFITS AND COVERAGES."&nbsp;</span></p> <p><span class="cls0">2. If applicable, the same documents shall contain in boldface type on the face page of the policy and the certificate: "THE BENEFITS AND COVERAGE DESCRIBED HEREIN ARE FUNDED BY CONTRIBUTIONS FROM EMPLOYERS, EMPLOYEES, AND OTHER INDIVIDUALS ELIGIBLE FOR COVERAGE."&nbsp;</span></p> <p><span class="cls0">3. Any statement required by this subsection is not required on identification cards issued to covered employees or other insureds.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner shall not grant or continue a license to any MEWA if the Commissioner reasonably deems that:&nbsp;</span></p> <p><span class="cls0">1. Any trust, manager or administrator is incompetent, untrustworthy, or so lacking in insurance expertise as to make the operations of the MEWA hazardous to the potential and existing insureds;&nbsp;</span></p> <p><span class="cls0">2. Any trustee, manager or administrator has been found guilty of or has pled guilty or no contest to a felony, a crime involving moral turpitude, or a crime punishable by imprisonment of one (1) year or more under the law of any state or country, whether or not a judgment or conviction has been entered; or&nbsp;</span></p> <p><span class="cls0">3. Any trustee, manager or administrator has had any type of insurance license justifiably revoked in this or any other state.&nbsp;</span></p> <p><span class="cls0">D. To qualify for and retain a license, a MEWA shall file all contracts with administrators or service companies with the Insurance Commissioner, and report any changes in such contracts to the Commissioner in advance of their implementation. The Commissioner shall have the authority to cause any contract with an administrator or service company to be renegotiated if the Commissioner reasonably determines that the charges under any such contract are excessively high in light of the services being delivered under the contract.&nbsp;</span></p> <p><span class="cls0">E. An initial filing fee of One Thousand Dollars ($1,000.00) is required for licensure. Each subsequent year the MEWA is in operation, an annual fee of Two Hundred Fifty Dollars ($250.00) shall be required.&nbsp;</span></p> <p><span class="cls0">F. Failure to maintain compliance with the eligibility requirements established by this section is a ground for denial, suspension or revocation of the license of a MEWA.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1992, c. 374, &sect; 3, eff. Jan. 1, 1993. Amended by Laws 2002, c. 129, &sect; 1, eff. Nov. 1, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-636. Use of words or descriptions causing beneficiaries to believe MEWA is insurance company.&nbsp;</span></p> <p><span class="cls0">No licensed MEWA shall use in its name, contracts, literature, advertising in any medium, or any other printed matter any words or descriptions which would cause beneficiaries or potential beneficiaries to believe it is an insurance company.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1992, c. 374, &sect; 4, eff. Jan. 1, 1993.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-637. Application for license.&nbsp;</span></p> <p><span class="cls0">Each MEWA shall file with the Insurance Commissioner an application for a license on a form prescribed by the Commissioner and signed under oath by officers of the association or the administrator of the MEWA. The application shall include or have attached the following:&nbsp;</span></p> <p><span class="cls0">1. A copy of any articles of incorporation, constitution and bylaws of any association;&nbsp;</span></p> <p><span class="cls0">2. A list of the names, addresses and official capacities with the MEWA of the individuals who will be responsible for the management and conduct of the affairs of the MEWA, including all trustees, officers and directors. Such individuals shall fully disclose the extent and nature of any contracts or arrangements between them and the MEWA, including possible conflicts of interest;&nbsp;</span></p> <p><span class="cls0">3. A copy of the articles of incorporation, bylaws or trust agreement that governs the operation of the MEWA;&nbsp;</span></p> <p><span class="cls0">4. A copy of the policy, contract, certificate, summary plan description or other evidence of the benefits and coverages provided to covered employees, including a table of the rates charged or proposed to be charged for each form of such contract. A qualified actuary shall certify that:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the rates are neither inadequate, nor excessive, nor unfairly discriminatory,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the rates are appropriate for the classes of risks for which that have been computed, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;an adequate description of the rating methodology has been filed with the Commissioner and such methodology follows consistent and equitable actuarial principles.&nbsp;</span></p> <p><span class="cls0">For purposes of this section and Section 639 of this title, a qualified actuary is an actuary who is a Fellow of the Society of Actuaries (FSA), a member of the American Academy of Actuaries, or an Enrolled Actuary under the Employee Retirement Income Security Act of 1974 (29 U.S.C., Section 1001 et seq.) and has experience in establishing rates for a self-insured trust and health services being provided;&nbsp;</span></p> <p><span class="cls0">5. Any administrator retained by the MEWA must be a licensed third party administrator. The MEWA must provide proof of a fidelity bond which shall protect against acts of fraud or dishonesty in servicing the MEWA, covering each person responsible for servicing the MEWA, in an amount equal to the greater of ten percent (10%) of the contributions received by the MEWA or ten percent (10%) of the benefits paid, during the preceding calendar year, with a minimum amount requirement of Twenty Thousand Dollars ($20,000.00) and a maximum amount requirement of Five Hundred Thousand Dollars ($500,000.00);&nbsp;</span></p> <p><span class="cls0">6. A copy of the MEWA's stop-loss agreement. The stop-loss insurance agreement must be issued by an insurer authorized to do business in this state and must provide both specific and aggregate coverage with an aggregate retention of no more than one hundred twenty-five percent (125%) of the expected claims for the next plan year and a specific retention amount as annually indicated in the actuarial opinion. The Insurance Commissioner shall have the authority to waive the requirements for aggregate stop-loss coverage if deemed appropriate;&nbsp;</span></p> <p><span class="cls0">7. In the initial application, a feasibility study, made by a qualified actuary with an opinion acceptable to the Commissioner, that addresses market potential, market penetration, market competition, operating expenses, gross revenues, net income, total assets and liabilities, cash flow and other items as the Commissioner requires. The study shall be for the greater of three (3) years or until the MEWA has been projected to be profitable for twelve (12) consecutive months. The study must show that the MEWA would not, at any month end of the projection period, have less that ninety percent (90%) of the reserves as required by a qualified actuary;&nbsp;</span></p> <p><span class="cls0">8. A copy of an audited financial statement of the MEWA prepared by a licensed certified public accountant;&nbsp;</span></p> <p><span class="cls0">9. A copy of every contract between the MEWA and any administrator or service company; and&nbsp;</span></p> <p><span class="cls0">10. Such additional information as the Commissioner may reasonably require.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1992, c. 374, &sect; 5, eff. Jan. 1, 1993. Amended by Laws 2002, c. 129, &sect; 2, eff. Nov. 1, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-638. Compliance with provisions of Title 36 relating to examinations, deposits and solvency regulation.&nbsp;</span></p> <p><span class="cls0">Every MEWA shall comply with Articles 15 through 19 and Sections 308 through 310, 311.1 and 619 of Title 36 of the Oklahoma Statutes which pertain to examinations, deposits and solvency regulation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1992, c. 374, &sect; 6, eff. Jan. 1, 1993.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-639. Annual financial report - Actuarial certification - Quarterly financial statements - Penalties.&nbsp;</span></p> <p><span class="cls0">A. Every MEWA shall, within ninety (90) days after the end of each fiscal year of the MEWA, or within any such extension of time that the Insurance Commissioner for good cause grants, file a report with the Commissioner, on forms acceptable to the Commissioner and verified by the oath of a member of the board of trustees or by an administrator of the MEWA, showing its financial condition on the last day of the preceding fiscal year. The report shall contain an audited financial statement of the MEWA prepared in accordance with generally accepted accounting principles, including its balance sheet and a statement of the operations for the preceding fiscal year certified by an independent accounting firm or individual holding a permit to practice public accounting in this state. The report shall also include an analysis of the adequacy of reserves and contributions or premiums charged, based on a review of past and projected claims and expenses.&nbsp;</span></p> <p><span class="cls0">B. In conjunction with the annual report required in subsection A of this section, the MEWA shall submit an actuarial certification prepared by a qualified actuary that indicates:&nbsp;</span></p> <p><span class="cls0">1. The MEWA is actuarially sound, with the certification considering the rates, benefits, and expenses of, and any other funds available for the payment of obligations of the MEWA;&nbsp;</span></p> <p><span class="cls0">2. The rates being charged and to be charged for contracts are actuarially adequate to the end of the period for which rates have been guaranteed;&nbsp;</span></p> <p><span class="cls0">3. The recommended amount of cash reserves the MEWA should maintain, which shall not be less than the greater of twenty percent (20%) of the total contributions in the preceding plan year or twenty percent (20%) of the total estimated contributions for the current plan year. The cash reserves shall be calculated with proper actuarial regard for known claims, paid and outstanding, a history of incurred but not reported claims, claims handling expenses, unearned premium, a trend factor, and a margin for error. Cash reserves required by this section shall be maintained in cash or federally guaranteed obligations of less than five-year maturity that have a fixed or recoverable principal amount or such other investments as the Commissioner may authorize by rule;&nbsp;</span></p> <p><span class="cls0">4. Whether amounts reserved to cover the cost of health care benefits are:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;calculated in accordance with the loss reserving standards that would be applicable to a private insurance company writing the same coverage,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;computed in accordance with accepted loss reserving standards, including a reserve for Incurred But Not Reported Claims (IBNR), and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;fairly stated in accordance with sound loss reserving standards;&nbsp;</span></p> <p><span class="cls0">5. The recommended level of specific and aggregate stop-loss insurance that the MEWA should maintain and whether the MEWA is funding at the aggregate retention plus all other costs of the MEWA; and&nbsp;</span></p> <p><span class="cls0">6. Such other information relating to the performance of the MEWA that is reasonably required by the Commissioner.&nbsp;</span></p> <p><span class="cls0">C. The MEWA shall send an annual report to all of the employers, describing the financial condition of the MEWA as of the end of the last fiscal year. The report must be sent at the same time as the filing of the annual statement of the MEWA.&nbsp;</span></p> <p><span class="cls0">D. The Commissioner may require a MEWA to file quarterly, within forty-five (45) days after the end of each of the remaining fiscal quarters, a financial statement on a form prescribed by the Commissioner, verified by the oath of a member of the board of trustees and an administrator of the MEWA, showing its financial condition on the last day of the preceding quarter and the statement of a qualified actuary setting forth the actuary&rsquo;s opinion relating to the level of cash reserves in accordance with paragraphs 3 and 4 of subsection B of this section.&nbsp;</span></p> <p><span class="cls0">E. Any MEWA that fails to file a report as required by this section is subject to Section 311 of this title; and, after notice and opportunity for hearing, the Commissioner may suspend the MEWA's authority to enroll new insureds or to do business in this state while the failure continues.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1992, c. 374, &sect; 7, eff. Jan. 1, 1993. Amended by Laws 2002, c. 129, &sect; 3, eff. Nov. 1, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-640. Denial, suspension or revocation of license - Corrective action plans - Rescission or modification of suspension order.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall deny, suspend or revoke a MEWA's license if, after notice and opportunity for a hearing, the Commissioner finds that the MEWA:&nbsp;</span></p> <p><span class="cls0">1. Is insolvent;&nbsp;</span></p> <p><span class="cls0">2. Is using such methods and practices in the conduct of its business as to render its further transaction of business in this state hazardous or injurious to its participating employees, covered employees and dependents, or to the public;&nbsp;</span></p> <p><span class="cls0">3. Has failed to pay any final judgment rendered against it in a court of competent jurisdiction within sixty (60) days after the judgment became final;&nbsp;</span></p> <p><span class="cls0">4. Is or has been in violation of any material provisions of this act;&nbsp;</span></p> <p><span class="cls0">5. Is no longer actuarially sound; or&nbsp;</span></p> <p><span class="cls0">6. Is charging rates that are excessive, inadequate or unfairly discriminatory.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner may deny, suspend or revoke the license of any MEWA if, after notice and opportunity for a hearing, the Commissioner determines that the MEWA:&nbsp;</span></p> <p><span class="cls0">1. Has violated any lawful order or rule of the Commissioner or any applicable provisions of this act;&nbsp;</span></p> <p><span class="cls0">2. Has refused to produce its accounts, records or files for examination under Sections 308 through 310 of Title 36 of the Oklahoma Statutes or through any of its officers has refused to give information with respect to its affairs or to perform any other legal obligation as to an examination;&nbsp;</span></p> <p><span class="cls0">3. Utilized persons to solicit enrollments through an unlicensed agent; or&nbsp;</span></p> <p><span class="cls0">4. Has violated any provision of the Unfair Claim Settlement Practices Act, Section 1221 et seq. of Title 36 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">C. Whenever the financial condition of the MEWA is such that, if not modified or corrected, its continued operation would result in impairment or insolvency, in addition to any provisions in this act, the Commissioner may order the MEWA to file with the Commissioner and implement a corrective action plan designed to do one or more of the following:&nbsp;</span></p> <p><span class="cls0">1. Reduce the total amount of present potential liability for benefits by reinsurance or other means;&nbsp;</span></p> <p><span class="cls0">2. Reduce the volume of new business being accepted;&nbsp;</span></p> <p><span class="cls0">3. Reduce the expenses of the MEWA by specified methods; or&nbsp;</span></p> <p><span class="cls0">4. Suspend or limit the writing of new business for a period of time.&nbsp;</span></p> <p><span class="cls0">If the MEWA fails to submit a plan within the time specified by the Commissioner or submits a plan that is insufficient to correct the MEWA's financial condition, the Commissioner may order the MEWA to implement one or more of the corrective actions listed in this subsection.&nbsp;</span></p> <p><span class="cls0">D. The Commissioner shall, in the order suspending the authority of a MEWA to enroll new insureds, specify the period during which the suspension is to be in effect and the conditions, if any, that must be met prior to reinstatement of its authority to enroll new insureds. The order of suspension is subject to rescission or modification by further order of the Commissioner before the expiration of the suspension period. Reinstatement shall not be made unless requested in writing by the MEWA; however, the Commissioner shall not grant reinstatement if it is found that the circumstances for which suspension occurred still exist.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1992, c. 374, &sect; 8, eff. Jan. 1, 1993.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-641. Promulgation of rules relating to multiple employer welfare arrangements.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner may promulgate rules to implement the provisions of Sections 633 through 640 of Title 36 of the Oklahoma Statutes relating to multiple employer welfare arrangements.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2002, c. 129, &sect; 4, eff. Nov. 1, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-650. Competition with Nine-One-One system prohibited.&nbsp;</span></p> <p><span class="cls0">Insurers, nonprofit health service plans, and health maintenance organizations shall not establish or promote an emergency medical response, triage, or transportation system in competition with or in substitution of the Nine-One-One system. Insurers, nonprofit health service plans, and health maintenance organizations shall not use false or misleading language to discourage or prohibit access to the Nine-One-One system.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2000, c. 353, &sect; 3, eff. Nov. 1, 2000.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36701. Definitions not mutually exclusive.&nbsp;</span></p> <p><span class="cls0">It is intended that certain coverages may come within the definitions of two or more kinds of insurance as set forth in this article, and the fact that such a coverage is included within one definition shall not exclude such coverage as to any other kind of insurance within the definition of which such coverage likewise reasonably is includable.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 239, &sect; 701. &nbsp;</span></p> <p><span class="cls0">&sect;36702. "Life insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Life insurance" is insurance on human lives and insurance appertaining thereto or connected therewith. The transacting of life insurance includes the granting of endowment benefits, additional benefits in the event of death or dismemberment by accident or accidental means, additional benefits in the event of the disability of the insured, optional modes of settlement of proceeds of life insurance, and additional benefits providing acceleration of life or endowment or annuity benefits in advance of the time they would otherwise be payable, as an indemnity for longterm care which is certified or ordered by a physician, including but not limited to, professional nursing care, medical care expenses, custodial nursing care, nonnursing custodial care provided in a nursing home or at a residence of the insured or providing such acceleration upon the occurrence of a castastrophic disease or diseases as designated and defined by the policy. An insurer authorized to transact life insurance may also grant annuities.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 239, &sect; 702. &nbsp;</span></p> <p><span class="cls0">&sect;36703. "Accident and health insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Accident and health insurance" is insurance against bodily injury, disablement, or death by accident or accidental means, or the expense thereof, or against disablement or expense resulting from sickness, and every insurance appertaining thereto.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 239, &sect; 703. &nbsp;</span></p> <p><span class="cls0">&sect;36704. "Property insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Property insurance" is insurance on real or personal property of every kind and interest therein, against loss or damage from any or all hazard or cause, and against loss consequential upon such loss or damage, other than noncontractual legal liability for any such loss or damage. Property insurance shall also include miscellaneous insurance as defined in paragraph 11 of section 707 of this article except as to any noncontractual liability coverage includable therein.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 239, &sect; 704. &nbsp;</span></p> <p><span class="cls0">&sect;36705. "Marine insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Marine insurance" includes:&nbsp;</span></p> <p><span class="cls0">1. Insurance against any and all kinds of loss or damage to vessels, craft, aircraft, cars, automobiles and vehicles of every kind, as well as all goods, freight, cargoes, merchandise, effects, disbursements, profits, moneys, bullion, precious stones, securities, choses in action, evidence of debt, valuable papers, bottomry and respondentia interests and all other kinds of property and interests therein, in respect to, appertaining to or in connection with any and all risks or perils of navigation, transit, or transportation, including war risks, on or under any seas or other waters, on land or in the air, or while being assembled, packed, crated, baled, compressed or similarly prepared for shipment or while awaiting the same or during any delays, storage, transshipment, or reshipment incident thereto, including marine builders' risks and all personal property floater risks;&nbsp;</span></p> <p><span class="cls0">2. Insurance against any and all kinds of loss or damage to person or to property in connection with or appertaining to a marine, inland marine, transit or transportation insurance, including liability for loss of or damage to either, arising out of or in connection with the construction, repair, operation, maintenance or use of the subject matter of such insurance (but not including life insurance or surety bonds nor insurance against loss by reason of bodily injury to the person arising out of the ownership, maintenance or use of automobiles);&nbsp;</span></p> <p><span class="cls0">3. Insurance against any and all kinds of loss or damage to precious stones, jewelry, gold, silver and other precious metals, whether used in business or trade or otherwise and whether the same be in course of transportation or otherwise;&nbsp;</span></p> <p><span class="cls0">4. Insurance against any and all kinds of loss or damage to bridges, tunnels and other instrumentalities of transportation and communication (excluding buildings, their furniture and furnishings, fixed contents and supplies held in storage) unless fire, tornado, sprinkler leakage, hail, explosion, earthquake, riot or civil commotion or any or all of them are the only hazards to be covered;&nbsp;</span></p> <p><span class="cls0">5. Insurance against any and all kinds of loss or damage to piers, wharves, docks and slips, excluding the risks of fire, tornado, sprinkler leakage, hail, explosion, earthquake, riot and civil commotion and each of them;&nbsp;</span></p> <p><span class="cls0">6. Insurance against any and all kinds of loss or damage to other aids to navigation and transportation, including dry docks and marine railways, dams and appurtenant facilities for the control of waterways; and&nbsp;</span></p> <p><span class="cls0">7. Marine protection and indemnity insurance, which is insurance against, or against legal liability of the insured for, loss, damage or expense arising out of, or incident to, the ownership, operation, chartering, maintenance, use, repair or construction of any vessel, craft or instrumentality in use in ocean or inland waterways, including liability of the insured for personal injury, illness or death or for loss of or damage to the property of another person.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 240, &sect; 705. &nbsp;</span></p> <p><span class="cls0">&sect;36706. "Vehicle insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Vehicle insurance" is insurance against loss of or damage to any land vehicle or aircraft or any draft or riding animal or to property while contained therein or thereon or being loaded or unloaded therein or therefrom, from any hazard or cause, and against any loss, liability or expense resulting from or incident to ownership, maintenance or use of any such vehicle, aircraft or animal; together with insurance against accidental death or accidental injury to individuals, including the named insured, while in, entering, alighting from, adjusting, repairing, cranking, or caused by being struck by a vehicle, aircraft or draft or riding animal, if such insurance is issued as a part of insurance on the vehicle, aircraft or draft or riding animal.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 240, &sect; 706. &nbsp;</span></p> <p><span class="cls0">&sect;36707. "Casualty insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Casualty insurance" includes vehicle insurance as defined in Section 706 and accident and health insurance as defined in Section 703, of this article, and in addition includes:&nbsp;</span></p> <p><span class="cls0">1. Liability insurance, which is insurance against legal liability for the death, injury, or disability of any human being, or for damage to property; and provision of medical, hospital, surgical, disability benefits to injured persons and funeral and death benefits to dependents, beneficiaries or personal representatives of persons killed, irrespective of legal liability of the insured, when issued as an incidental coverage with or supplemental to liability insurance.&nbsp;</span></p> <p><span class="cls0">2. Workers' compensation and employers' liability insurance, which is insurance of the obligations accepted by, imposed upon, or assumed by employers for death, disablement, or injury of employees.&nbsp;</span></p> <p><span class="cls0">3. Burglary and theft insurance, which is insurance against loss or damage by burglary, theft, larceny, robbery, forgery, fraud, vandalism, malicious mischief, confiscation, or wrongful conversion, disposal, or concealment, or from any attempt at any of the foregoing, including supplemental coverages for medical, hospital, surgical, and funeral benefits sustained by the named insured or other person as a result of bodily injury during the commission of a burglary, robbery, or theft by another; also insurance against loss of or damage to monies, coins, bullion, securities, notes, drafts, acceptances, or any other valuable papers and documents, resulting from any cause.&nbsp;</span></p> <p><span class="cls0">4. Personal property floater insurance, which is insurance upon personal effects against loss or damage from any cause.&nbsp;</span></p> <p><span class="cls0">5. Glass insurance, which is insurance against loss or damage to glass, including its lettering, ornamentation, and fittings.&nbsp;</span></p> <p><span class="cls0">6. Boiler and machinery insurance, which is insurance against any liability and loss or damage to property or interest resulting from accidents to or explosion of boilers, pipes, pressure containers, machinery, or apparatus, and to make inspection of and issue certificates of inspection upon boilers, machinery, and apparatus of any kind, whether or not insured.&nbsp;</span></p> <p><span class="cls0">7. Leakage and fire extinguishing equipment insurance, which is insurance against loss or damage to any property or interest caused by the breakage or leakage of sprinklers, hoses, pumps, and other fire extinguishing equipment or apparatus, water pipes and containers, or by water entering through leaks or openings in buildings, and insurance against loss or damage to such sprinklers, hoses, pumps, and other fire extinguishing equipment or apparatus.&nbsp;</span></p> <p><span class="cls0">8. Credit insurance, which is insurance against loss or damage resulting from failure of debtors to pay their obligations to the insured.&nbsp;</span></p> <p><span class="cls0">9. Malpractice insurance, which is insurance against legal liability of the insured, and against loss, damage, or expense incidental to a claim of such liability, and including medical, hospital, surgical, and funeral benefits to injured persons, irrespective of legal liability of the insured, arising out of the death, injury, or disablement of any person, or arising out of damage to the economic interest of any person, as the result of negligence in rendering expert, fiduciary, or professional services.&nbsp;</span></p> <p><span class="cls0">10. Entertainments insurance, which is insurance indemnifying the producer of any motion picture, television, radio, theatrical, sport, spectacle, entertainment, or similar production, event, or exhibition against loss from interruption, postponement, or cancellation thereof due to death, accidental injury, or sickness of performers, participants, directors, or other principals.&nbsp;</span></p> <p><span class="cls0">11. Miscellaneous insurance, which is insurance against any other kind of loss, damage, or liability properly a subject of insurance and not within any other kind of insurance as defined in this article, if such insurance is not disapproved by the Insurance Commissioner as being contrary to law or public policy.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 240, &sect; 707, operative July 1, 1957.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36708. "Surety insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Surety insurance" includes:&nbsp;</span></p> <p><span class="cls0">1. Fidelity insurance, which is insurance guaranteeing the fidelity of persons holding positions of public or private trust.&nbsp;</span></p> <p><span class="cls0">2. Insurance guaranteeing the performance of contracts, other than insurance policies, and guaranteeing and executing bonds, undertakings and contracts of suretyship.&nbsp;</span></p> <p><span class="cls0">3. Insurance indemnifying banks, bankers, brokers, financial or moneyed corporations or associations against loss, resulting from any cause, of bills of exchange, notes, bonds, securities, evidences of debt, deeds, mortgages, warehouse receipts or other valuable papers, documents, money, precious metals and articles made therefrom, jewelry, watches, necklaces, bracelets, gems, precious and semiprecious stones, including any loss while the same are being transported in armored motor vehicles, or by messenger, but not including any other risks of transportation or navigation; also insurance against loss or damage to such an insured's premises or to his furnishings, fixtures, equipment, safes, and vaults therein, caused by burglary, robbery, theft, vandalism or malicious mischief, or any attempt thereat.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 241, &sect; 708. &nbsp;</span></p> <p><span class="cls0">&sect;36709. "Title insurance" defined.&nbsp;</span></p> <p><span class="cls0">"Title insurance" is insurance of owners of property or others having an interest therein, or liens or encumbrances thereon, against loss by encumbrance, or defective titles, or invalidity, or adverse claim to title.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 242, &sect; 709. &nbsp;</span></p> <p><span class="cls0">&sect;36710. Limit of risk.&nbsp;</span></p> <p><span class="cls0">A. No insurer shall retain any risk on any one subject of insurance, whether located or to be performed in Oklahoma or elsewhere, in an amount exceeding ten percent (10%) of its surplus to policyholders.&nbsp;</span></p> <p><span class="cls0">B. A "subject of insurance" for the purposes of this section, as to insurance against fire and hazards other than windstorm or earthquake, includes all properties insured by the same insurer which are customarily considered by underwriters to be subject to loss or damage from the same fire or other such hazard insured against.&nbsp;</span></p> <p><span class="cls0">C. Reinsurance authorized by Section 711 of this article shall be deducted in determining risk retained. As to surety risks, deduction shall also be made of the amount assumed by any established incorporated cosurety and the value of any security deposited, pledged, or held subject to the surety's consent and for the surety's protection.&nbsp;</span></p> <p><span class="cls0">D. "Surplus to policyholders" for the purpose of this section shall be deemed to include any voluntary reserves which are not required pursuant to law, and shall be determined from the last sworn statement of the insurer on file with the Insurance Commissioner or by the last report of examination by the Insurance Commissioner, whichever is the more recent at time of assumption of such risk.&nbsp;</span></p> <p><span class="cls0">E. As to alien insurers, other than life insurers domiciled in Canada, this section shall relate only to risks and surplus to policyholders of the insurer's United States branch.&nbsp;</span></p> <p><span class="cls0">F. This section shall not apply to group life or group or blanket accident and health insurance, title insurance, insurance of ocean marine risks or maine protection and indemnity risks, workers' compensation insurance, employers' liability coverages, nor to any policy or type of coverage as to which the maximum possible loss to the insurer is not readily ascertainable on issuance of the policy.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 242, &sect; 710, operative July 1, 1957.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36711. Allowance for credit or increase in amount at risk &ndash; Contract requirements.&nbsp;</span></p> <p><span class="cls0">A. 1. No credit shall be allowed, as an admitted asset or as a deduction from liability, to any ceding insurer for reinsurance nor increase the amount it is authorized to have at risk unless the reinsurance contract provides, in substance, that in the event of the insolvency of the ceding insurer, the reinsurance shall be payable under a contract or contracts reinsured by the assuming insurer on the basis of reported claims allowed by the liquidation court, without diminution because of the insolvency of the ceding insurer. Such payments shall be made directly to the ceding insurer or to its domiciliary liquidator, except:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;if the contract or other written agreement specifically provides another payee of such reinsurance in the event of the insolvency of the ceding insurer, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;if the assuming insurer, with the consent of the direct insureds, has assumed such policy obligations of the ceding insurer as direct obligations of the assuming insurer to the payees under such policies and in substitution for the obligations of the ceding insurer to such payees.&nbsp;</span></p> <p><span class="cls0">2. The reinsurance agreement may provide that the domiciliary liquidator of an insolvent ceding insurer shall give written notice to the assuming insurer of the pendence of a claim against such ceding insurer on the contract reinsured within a reasonable time after such claim is filed in the liquidation proceeding. During the pendence of such claim, any assuming insurer may investigate such claim and interpose, at its own expense, in the proceeding where such claim is to be adjudicated, any defenses which it deems available to the ceding insurer, or its liquidator. Such expense may be filed as a claim against the insolvent ceding insurer to the extent of a proportionate share of the benefit which may accrue to the ceding insurer solely as a result of the defense undertaken by the assuming insurer. If two or more assuming insurers are involved in the same claim and a majority in interest elect to interpose one or more defenses to such claim, the expense shall be apportioned in accordance with the terms of the reinsurance agreement as though such expense had been incurred by the ceding insurer.&nbsp;</span></p> <p><span class="cls0">B. This section shall not apply to insurance of ocean marine risks or marine protection and indemnity risks.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 242, &sect; 711. Amended by Laws 1984, c. 149, &sect; 4, eff. Nov. 1, 1984; Laws 1993, c. 79, &sect; 3, eff. Sept. 1, 1993; Laws 2000, c. 169, &sect; 5, eff. Nov. 1, 2000.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-712. Posting of standard policies and endorsements.&nbsp;</span></p> <p><span class="cls0">Any insurance company offering property and casualty insurance policies may, in lieu of mailing or delivering, post on their website standard policies and endorsements that do not contain personally identifiable information. If an insurer elects to provide standard policy and endorsement forms on the insurer&rsquo;s website, the insurer shall ensure that the policies and endorsements are posted in a manner that complies with the following conditions:&nbsp;</span></p> <p><span class="cls0">1. The policy and endorsements shall be easily accessible;&nbsp;</span></p> <p><span class="cls0">2. The insurer shall archive all policies and endorsements for a period of five (5) years after the expiration of the policy;&nbsp;</span></p> <p><span class="cls0">3. All policies and endorsements shall be posted in a manner that allows an insured to print and save electronic copies of the documents;&nbsp;</span></p> <p><span class="cls0">4. The insurer shall provide notice at the time of issuance of the initial policy forms and upon renewal of a method by which the insured may obtain, without charge, a paper or electronic copy of the insured&rsquo;s policy and endorsements;&nbsp;</span></p> <p><span class="cls0">5. Each declaration page issued to an insured shall clearly identify the policy and endorsement forms purchased by the insured; and&nbsp;</span></p> <p><span class="cls0">6. The insurer shall provide notice of any changes to the forms or endorsements and of the insured&rsquo;s right to obtain, without charge, paper or electronic copies of the forms in the manner the insurer customarily communicates with the insured.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2013, c. 68, &sect; 1, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36900.1. Short title.&nbsp;</span></p> <p><span class="cls0">Sections 11 through 36 of this act shall be known and may be cited as the "Oklahoma Insurance Rating Act".&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1987, c. 210, &sect; 11, eff. July 1, 1987. &nbsp;</span></p> <p><span class="cls0">&sect;36-901. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36901.1. Purposes of act.&nbsp;</span></p> <p><span class="cls0">A. The purposes of this act are:&nbsp;</span></p> <p><span class="cls0">1. To promote the public welfare by regulating insurance rates to the end that they shall not be excessive, inadequate or unfairly discriminatory;&nbsp;</span></p> <p><span class="cls0">2. To improve availability, fairness and reliability of insurance and insurance rates;&nbsp;</span></p> <p><span class="cls0">3. To authorize essential cooperative action among insurers in the ratemaking process and to regulate such activity to prevent practices that tend to substantially lessen competition or to create a monopoly;&nbsp;</span></p> <p><span class="cls0">4. To encourage the most efficient and economic marketing practices; and&nbsp;</span></p> <p><span class="cls0">5. To encourage the providing of price and other information to enable consumers to purchase insurance suitable for their needs and to foster competitive insurance markets.&nbsp;</span></p> <p><span class="cls0">B. This act shall be liberally construed to effectuate its purposes.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1987, c. 210, &sect; 13, eff. July 1, 1987. &nbsp;</span></p> <p><span class="cls0">&sect;36-901.2. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in this act unless the context otherwise requires:&nbsp;</span></p> <p><span class="cls0">1. "Act" means the Oklahoma Insurance Rating Act;&nbsp;</span></p> <p><span class="cls0">2. "Commissioner" means the Insurance Commissioner of the State of Oklahoma or his designee;&nbsp;</span></p> <p><span class="cls0">3. "Department" means the Insurance Department of the State of Oklahoma;&nbsp;</span></p> <p><span class="cls0">4. "Rate" means the cost of insurance per exposure unit, whether expressed as a single number or as a prospective loss cost and an adjustment to account for the treatment of expenses, profit and variations in loss experience, prior to any application of individual risk variations based on loss or expense considerations, and does not include minimum premiums:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;"prospective loss cost", as used in this paragraph, means that portion of a rate that does not include provisions for expenses, other than loss adjustment expenses, or profit, and are based on historical aggregate losses and loss adjustment expenses adjusted through development to their ultimate value and projected through trending to a future point in time, and&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;"expenses", as used in this paragraph, means that portion of a rate attributable to acquisition, field supervision, collection expenses, general expenses, taxes, licenses, and fees; and&nbsp;</span></p> <p><span class="cls0">5. "Rating organization, advisory organization or statistical organization" means any two or more insurers acting in cooperation or in concert for the purpose of making rates, rating plans or rating systems.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1987, c. 210, &sect; 14, eff. July 1, 1987. Amended by Laws 1994, c. 129, &sect; 2, eff. Sept. 1, 1994; Laws 2006, c. 264, &sect; 11, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-901.3. Filing - Contents and procedure.&nbsp;</span></p> <p><span class="cls0">A. In order to be complete, a filing shall contain the following:&nbsp;</span></p> <p><span class="cls0">1. A memorandum briefly summarizing the gist of the filing;&nbsp;</span></p> <p><span class="cls0">2. An index to the filing;&nbsp;</span></p> <p><span class="cls0">3. A clear and concise statement of the action desired to be taken by the Commissioner;&nbsp;</span></p> <p><span class="cls0">4. References to the sections of law and to rules and regulations which authorize the action desired to be taken by the Insurance Commissioner or which support the information contained in the filing;&nbsp;</span></p> <p><span class="cls0">5. An explanation of the application of the filing factors, which are contained in subsection A of Section 902.2 or subsection B of Section 985 of this title, together with assumptions and conclusions concerning such factors;&nbsp;</span></p> <p><span class="cls0">6. References to exhibits and other documents contained in the filing which are relied upon to support the action requested by the filing; and&nbsp;</span></p> <p><span class="cls0">7. Any other information required by the Commissioner.&nbsp;</span></p> <p><span class="cls0">B. If the filer is an advisory organization or joint underwriting association, it is sufficient for such information to be provided in summary form for all the filer's members and subscribers.&nbsp;</span></p> <p><span class="cls0">C. If a filing is incomplete, the Commissioner shall notify the filer, in writing, of the necessary materials required by this article, by rules of the Commissioner or by orders adopted by the Commissioner to complete the filing.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1987, c. 210, &sect; 15, eff. July 1, 1987. Amended by Laws 1997, c. 418, &sect; 31, eff. Nov. 1, 1997; Laws 2006, c. 264, &sect; 12, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-901.4. Hearings - Period of advisement - Additional information, analysis, consideration and investigation.&nbsp;</span></p> <p><span class="cls0">A. Not less than ten (10) days in advance of a meeting to determine whether a hearing will be held, the Insurance Commissioner shall give notice to each insurer or organization making the filing, to each party to the filing and to any person who annually requests in writing to be notified of filings made pursuant to this act, of the date, time and location of any hearing or rehearing, the name of the insurer or organization making the filing and of the parties to the filing and a brief statement of the action requested in the filing.&nbsp;</span></p> <p><span class="cls0">B. Hearings shall be open to the public.&nbsp;</span></p> <p><span class="cls0">C. Any person aggrieved with respect to a rate filing may make written application to the Commissioner to participate in any hearing called by the Commissioner. If the Commissioner finds the application to be supported by reasonable grounds, it may allow the applicant to appear in person or by counsel.&nbsp;</span></p> <p><span class="cls0">At the conclusion of any formal hearing and before the final closing of such hearing, any party in interest upon timely request shall be granted, as a matter of right, a continuance of twentyfour (24) hours for the purpose of making examination and analyses of documents introduced in the hearing.&nbsp;</span></p> <p><span class="cls0">D. The evidentiary procedures of the Administrative Procedures Act shall apply to hearings conducted pursuant to this act.&nbsp;</span></p> <p><span class="cls0">E. Upon written request seasonably made by a person affected by the hearing, and at such person's expense, the Commissioner shall cause a full stenographic record of the proceedings to be made by a competent court reporter. If transcribed, such record shall be a part of the Commissioner&rsquo;s record of the hearing, and a copy of such stenographic record shall be furnished to any other party having a direct interest therein at the request and expense of such party.&nbsp;</span></p> <p><span class="cls0">F. Following a hearing on a filing made pursuant to this act, the Commissioner may take the matter under advisement for up to thirty (30) calendar days, subject to the provisions of Section 903 of this title.&nbsp;</span></p> <p><span class="cls0">G. At any time during the pendency of a filing, the Commissioner may:&nbsp;</span></p> <p><span class="cls0">1. Require the submission of additional information by any party to the filing;&nbsp;</span></p> <p><span class="cls0">2. Solicit proposals for independent analysis of the filing by qualified technicians, such technicians to be chosen pursuant to the provisions of Section 332 of this title;&nbsp;</span></p> <p><span class="cls0">3. Consider the findings of its employees or the technician; and&nbsp;</span></p> <p><span class="cls0">4. Conduct other or additional investigations including additional hearings.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1987, c. 210, &sect; 16, eff. July 1, 1987. Amended by Laws 1991, c. 204, &sect; 8, eff. Sept. 1, 1991; Laws 2006, c. 264, &sect; 13, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-901.5. Filing of advisory prospective loss costs and supporting actuarial data and statistical data for workers' compensation insurance.&nbsp;</span></p> <p><span class="cls0">A. Rating organizations shall develop and file for approval with the Insurance Commissioner in accordance with the provisions of this section, a filing containing advisory prospective loss costs and supporting actuarial and statistical data for workers' compensation insurance. Each insurer shall individually file their own specific profit and expense factors used to determine the final rates it will file for approval and the effective date of any rate changes.&nbsp;</span></p> <p><span class="cls0">B. As used in this section:&nbsp;</span></p> <p><span class="cls0">1. "Expenses" means that portion of a rate attributable to acquisition, field supervision, collection expenses, general expenses, taxes, licenses and fees;&nbsp;</span></p> <p><span class="cls0">2. "Rate" means the cost of insurance per exposure unit, whether expressed as a single number or as a prospective loss cost with an adjustment to account for the treatment of expenses, profit and variations in loss experience, prior to any application of individual risk variations based on loss or expense considerations, and does not include minimum premiums; and&nbsp;</span></p> <p><span class="cls0">3. "Prospective loss costs" means that portion of a rate that does not include provision for expenses (other than loss adjustment expenses) or profit, and is based on historical aggregate losses and loss adjustment expenses adjusted through development to its ultimate value and projected through trending to a future point in time.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1993, c. 349, &sect; 22, eff. Sept. 1, 1993. Amended by Laws 1997, c. 418, &sect; 32, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-902. Excessive, inadequate or unfairly discriminatory rates.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall not approve rates for insurance which are excessive, inadequate, or unfairly discriminatory.&nbsp;</span></p> <p><span class="cls0">1. An excessive rate is one which:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;is unreasonably high for the insurance provided, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;is unreasonable because (1) a reasonable degree of competition does not exist in the area with respect to the classification to which such rate is applicable and (2) the rate is unreasonably high for the insurance provided.&nbsp;</span></p> <p><span class="cls0">2. An inadequate rate is one which:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;is (1) unreasonably low for the insurance provided and (2) the continued use of such rate endangers, or if continued would endanger, the solvency of the insurer, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;is (1) unreasonably low for the insurance provided and (2) the continued use of such rate by the insurer has, or if continued would have, the effect of destroying competition or creating a monopoly, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;is insufficient to cover projected losses, expenses and a reasonable margin for profit for the line of insurance coverage to be offered in this state by the filer.&nbsp;</span></p> <p><span class="cls0">3. A rate shall not be unfairly discriminatory.&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;A rate is not unfairly discriminatory because it is based in part upon the establishment or modification of classifications of risks based upon:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;the size of the risk,&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;the expense or difficulty in management of the risk,&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;the individual experience of the risk,&nbsp;</span></p> <p class="cls3"><span class="cls0">(4)&nbsp;&nbsp;the location or dispersion of the risk, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(5)&nbsp;&nbsp;any other reasonable consideration attributable to the risk.&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;A rate is not unfairly discriminatory in relation to another in the same class of business if it reflects equitably the differences in expected losses and expenses. Rates are not unfairly discriminatory because different premiums result for policyholders with like loss exposures but different expense factors, or with like expense factors but different loss exposures, if the rates reflect the differences with reasonable accuracy.&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;A rate shall be deemed unfairly discriminatory as to a risk or group of risks if the application of premium discounts, credits, or surcharges among such risks does not bear a reasonable relationship to the expected loss and expense experience among the various risks.&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;A rate shall never be based upon race, color, creed or national origin.&nbsp;</span></p> <p><span class="cls0">B. The systems of expense provisions included in the rates for use by any insurer or group of insurers may differ from those of other insurers or groups of insurers to reflect the requirements of the operating methods of any such insurer or group with respect to any kind of insurance or subdivision or combination thereof for which subdivision or combination separate expense provisions are applicable.&nbsp;</span></p> <p><span class="cls0">C. Nothing in this act shall be construed to require uniformity in insurance rates, classifications, rating plans, or practices.&nbsp;</span></p> <p><span class="cls0">D. Nothing in this act shall abridge or restrict the freedom of contract of insurers, agents, brokers or employees with reference to the commissions, compensation, or salaries to be paid to such agents, brokers, or employees by insurers.&nbsp;</span></p> <p><span class="cls0">E. The burden of compliance with the provisions of this act shall rest upon the insurer or rating organization in all matters involving a filing made pursuant to Section 6821 of this title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 243, &sect; 902, operative July 1, 1957. Amended by Laws 1980, c. 322, &sect; 33, eff. Jan. 1, 1981; Laws 1986, c. 251, &sect; 9, eff. Nov. 1, 1986; Laws 1987, c. 210, &sect; 17, eff. July 1, 1987; Laws 1988, c. 291, &sect; 2, eff. Nov. 1, 1988; Laws 2006, c. 264, &sect; 14, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-902.1. Repealed by Laws 2005, 1st Ex.Sess., c. 1, &sect; 33, eff. July 1, 2005.&nbsp;</span></p> <p><span class="cls0">&sect;36-902.2. Factors for review of filing - Weight - Prohibited expenses.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner when reviewing a filing shall give due consideration to the following when, in its discretion, it determines that such factor or factors are applicable:&nbsp;</span></p> <p><span class="cls0">1. Past loss experience within and outside this state;&nbsp;</span></p> <p><span class="cls0">2. Prospective loss experience within and outside this state;&nbsp;</span></p> <p><span class="cls0">3. Physical hazards insured;&nbsp;</span></p> <p><span class="cls0">4. Safety and loss prevention programs;&nbsp;</span></p> <p><span class="cls0">5. Underwriting practices and judgment;&nbsp;</span></p> <p><span class="cls0">6. Catastrophe hazards;&nbsp;</span></p> <p><span class="cls0">7. Reasonable underwriting profit and contingencies;&nbsp;</span></p> <p><span class="cls0">8. Dividends, savings or unabsorbed premium deposits allowed or returned to policyholders;&nbsp;</span></p> <p><span class="cls0">9. Past expenses within and outside this state;&nbsp;</span></p> <p><span class="cls0">10. Prospective expenses within and outside this state;&nbsp;</span></p> <p><span class="cls0">11. Existence of classification rates for a given risk;&nbsp;</span></p> <p><span class="cls0">12. Investment income within and outside this state;&nbsp;</span></p> <p><span class="cls0">13. Rarity or peculiarity of the risks within and outside this state;&nbsp;</span></p> <p><span class="cls0">14. In the case of workers' compensation rates, differences in the hazard levels of different geographical regions of the state;&nbsp;</span></p> <p><span class="cls0">15. All other relevant factors within and outside this state; and&nbsp;</span></p> <p><span class="cls0">16. Whether existing rates continue to meet the standards of this article.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner shall determine the weight to be accorded each of the factors contained in subsection A of this section.&nbsp;</span></p> <p><span class="cls0">C. Past or prospective expenses within or outside this state pursuant to paragraphs 9 and 10 of subsection A of this section shall not include prohibited expenses for advertising or prohibited expenses for membership in organizations.&nbsp;</span></p> <p><span class="cls0">For the purpose of this subsection:&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Prohibited expenses for advertising" means the cost of advertising in any media the purpose of which is to influence legislation or to advocate support for or opposition to a candidate for public office;&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Prohibited expenses for advertising" shall not mean:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;any communication to customers and the public of information regarding an insurer's insurance products,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;any communication to customers and the public of safety, safety education or loss prevention information,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;periodic publications or reports to stockholders or members required by the certificate or bylaws of the insurer,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;any communication with customers and the public which provides instruction in the use of the insurer's products and services, or&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;any communication with customers and the public for giving notice or information required by law or otherwise necessary;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Prohibited expenses for membership" means the cost of membership in any organization which conducts substantial efforts, including but not limited to prohibited expenses for advertising, the purpose of which is to influence legislation or to advocate support for or opposition to a candidate for public office; and&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Prohibited expenses for membership" shall not mean the cost of membership in advisory organizations or other organizations the primary purpose of which is to provide statistical information on losses.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1987, c. 210, &sect; 18, eff. July 1, 1987. Amended by Laws 1993, c. 349, &sect; 23, eff. Sept. 1, 1993; Laws 1994, c. 129, &sect; 3, eff. Sept. 1, 1994; Laws 1997, c. 418, &sect; 34, eff. Nov. 1, 1997; Laws 2004, c. 519, &sect; 6, eff. Nov. 1, 2004; Laws 2006, c. 264, &sect; 15, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-902.3. Calculation of workers' compensation premiums - Equalization of expected losses and expenses between high and low wage-paying employers - Agency rule report.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">A. Workers' compensation premiums shall be calculated on a basis that, as nearly as is practicable, after the effects of experience rating and other applicable rating plans have been considered, the sum of expected losses and expected expenses as a percentage of premium shall be the same for high- and low-wage-paying employers in the same job classification.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner and the Board of Managers of CompSource Oklahoma shall:&nbsp;</span></p> <p><span class="cls0">1. Determine the extent to which high-wage-paying employers are paying premiums higher than those which would produce the same ratio of expected losses and expenses to premiums as for employers paying lower wages;&nbsp;</span></p> <p><span class="cls0">2. Determine whether this effect is primarily seen in certain types of job classifications;&nbsp;</span></p> <p><span class="cls0">3. Investigate alternatives and modifications to the current method of computing workers' compensation premiums, including wage rate recognition plans used in other states, split classifications, wage rate caps, and hours worked;&nbsp;</span></p> <p><span class="cls0">4. Conduct a hearing or hearings on this matter, including consideration of other alternatives; and&nbsp;</span></p> <p><span class="cls0">5. Adopt rules by January 1, 1996, to become effective on July 1, 1996, unless disapproved by the Legislature, to equalize, as nearly as is practicable, expected losses and expenses as a percentage of workers' compensation premiums for high- and low-wage-paying employers in the same job classification. If the effect is found to be primarily seen in certain types of job classifications, the rules shall be adopted to apply only to such types of job classifications. The adopted rules shall be subject to legislative review and shall be promulgated as permanent rules pursuant to the Administrative Procedures Act. The agency rule report required by the Administrative Procedures Act shall include a rule impact statement together with an actuarial analysis of the proposed rule describing in detail the classes of persons who most likely will be affected by the proposed rules; the classes of persons who will benefit from the adopted rules; and the probable economic impact of the proposed rules upon the affected classes of persons. The actuarial analysis shall be prepared by an independent actuary selected by the Insurance Commissioner. The rules shall not be invalidated on the ground that the contents of the rule impact statement or the actuarial analysis are insufficient or inaccurate.&nbsp;</span></p> <p><span class="cls0">C. The cost of the premium adjustment plan shall be allocated among all employers purchasing workers' compensation insurance from all carriers, including CompSource Oklahoma.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 3, emerg. eff. Nov. 4, 1994. Amended by Laws 2006, c. 264, &sect; 16, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">A. Workers' compensation premiums shall be calculated on a basis that, as nearly as is practicable, after the effects of experience rating and other applicable rating plans have been considered, the sum of expected losses and expected expenses as a percentage of premium shall be the same for high- and low-wage-paying employers in the same job classification.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner and the Board of Directors of CompSource Mutual Insurance Company shall:&nbsp;</span></p> <p><span class="cls0">1. Determine the extent to which high-wage-paying employers are paying premiums higher than those which would produce the same ratio of expected losses and expenses to premiums as for employers paying lower wages;&nbsp;</span></p> <p><span class="cls0">2. Determine whether this effect is primarily seen in certain types of job classifications;&nbsp;</span></p> <p><span class="cls0">3. Investigate alternatives and modifications to the current method of computing workers' compensation premiums, including wage rate recognition plans used in other states, split classifications, wage rate caps, and hours worked;&nbsp;</span></p> <p><span class="cls0">4. Conduct a hearing or hearings on this matter, including consideration of other alternatives; and&nbsp;</span></p> <p><span class="cls0">5. Adopt rules by January 1, 1996, to become effective on July 1, 1996, unless disapproved by the Legislature, to equalize, as nearly as is practicable, expected losses and expenses as a percentage of workers' compensation premiums for high- and low-wage-paying employers in the same job classification. If the effect is found to be primarily seen in certain types of job classifications, the rules shall be adopted to apply only to such types of job classifications. The adopted rules shall be subject to legislative review and shall be promulgated as permanent rules pursuant to the Administrative Procedures Act. The agency rule report required by the Administrative Procedures Act shall include a rule impact statement together with an actuarial analysis of the proposed rule describing in detail the classes of persons who most likely will be affected by the proposed rules; the classes of persons who will benefit from the adopted rules; and the probable economic impact of the proposed rules upon the affected classes of persons. The actuarial analysis shall be prepared by an independent actuary who is a member of the Casualty Actuarial Society or the American Academy of Actuaries who is qualified as described in the U.S. Qualifications Standards promulgated by the American Academy of Actuaries pursuant to the Code of Professional Conduct to perform such actuarial analysis selected by the Insurance Commissioner. The rules shall not be invalidated on the ground that the contents of the rule impact statement or the actuarial analysis are insufficient or inaccurate.&nbsp;</span></p> <p><span class="cls0">C. The cost of the premium adjustment plan shall be allocated among all employers purchasing workers' compensation insurance from all carriers.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 3, emerg. eff. Nov. 4, 1994. Amended by Laws 2006, c. 264, &sect; 16, eff. July 1, 2006; Laws 2013, c. 254, &sect; 15, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-902.4. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-903. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-903.1. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-903.2. Workplace safety plans - Expenses of implementation.&nbsp;</span></p> <p><span class="cls0">No insurance company shall request and the Insurance Commissioner shall not approve an increase for the expense portion of insurance company rate filings based upon the requirements of Section 6701 of this title and Section 355 of Title 85 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 15, emerg. eff. Nov. 4, 1994. Amended by Laws 2006, c. 264, &sect; 17, eff. July 1, 2006; Laws 2013, c. 254, &sect; 16.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-904. Inspection of filed rates - Information to insured - Proceedings by aggrieved persons - False or misleading information - Withholding policy or evidence.&nbsp;</span></p> <p><span class="cls0">A. All schedules and insurance rates and supporting information filed in accordance with the provisions of this article shall be open to inspection to the public after such filings are made.&nbsp;</span></p> <p><span class="cls0">B. Every advisory organization and every insurer which makes its own rates shall, within a reasonable time after receiving written request therefor and upon payment of such reasonable charge as it may make, furnish to any insured affected by a rate made by it, or to the authorized representative of such insured, all pertinent information as to such rate.&nbsp;</span></p> <p><span class="cls0">C. Every advisory organization and every insurer which makes its own rates shall provide within the state reasonable means whereby any person, aggrieved by the application of its rating system, may be heard, in person or by his authorized representative, on his written request to revise the manner in which such rating system has been applied in connection with the insurance afforded him. If the advisory organization or insurer fails to grant or reject such request, within thirty (30) days after it is made, this applicant may proceed in the same manner as if his application had been rejected. Any party affected by the action of such advisory organization or such insurer on such request may, within thirty (30) days after written notice of such action, appeal to the Insurance Commissioner, which, after a hearing held upon not less than ten (10) days written notice to the appellant and to such advisory organization or insurer, may modify, affirm or reverse such action.&nbsp;</span></p> <p><span class="cls0">D. No insurer, agent, broker, or advisory organization may willfully withhold required information from or give false or misleading information to the Commissioner.&nbsp;</span></p> <p><span class="cls0">E. No insurer, agent, or broker shall fail to furnish to an insured any policy or comparable evidence of insurance to which the insured is entitled.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 245, &sect; 904, operative July 1, 1957. Amended by Laws 1987, c. 210, &sect; 20, eff. July 1, 1987; Laws 2006, c. 264, &sect; 18, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-905. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36906. Group, associations and organizations; duties; licensing; adherence to filings.&nbsp;</span></p> <p><span class="cls0">A. Every group, association, or other organization of insurers authorized to act as such under the terms of this article, except groups or fleets described in subsections C and D of Section 905 shall file with the Board (1) a copy of its constitution, its articles of agreement or association, or its certificate of incorporation, and of its bylaws, rules, and regulations governing the conduct of its business; (2) a list of its members and subscribers, if any; (3) the name and address of a resident of the state upon whom notices or orders of the Board or process affecting it may be served; and shall notify and file with the Board promptly any change in the foregoing.&nbsp;</span></p> <p><span class="cls0">B. No group, association, or organization shall engage in any unfair or unreasonable practice in the conduct of its business.&nbsp;</span></p> <p><span class="cls0">C. No rating organization shall conduct its business with respect to insurance on risks located within the state without a license from the Board. To obtain such a license, a rating organization shall, in addition to the matters specified in subsection A of this section, supply to the Board a statement relating to its qualifications as a rating organization and its ability adequately to administer the rates, rules and regulations which it may make in behalf of its members and subscribers. No rating organization shall be licensed in this state unless it execute and file with the Board its permission for any of its members to deviate from its rate, in accordance with subsection F of this section.&nbsp;</span></p> <p><span class="cls0">If the Board finds that the applicant is competent, trustworthy, and otherwise qualified to act as a rating organization, it shall forthwith issue a license specifying the kinds of insurance and subdivisions thereof for which the applicant is authorized to act as a rating organization, but if the Board does not so find within thirty (30) days after it has received such application, it shall at the request of the applicant, give the applicant a full hearing.&nbsp;</span></p> <p><span class="cls0">Licenses issued pursuant to this section shall remain in effect until suspended or revoked by the Board unless voluntarily surrendered by the rating organization. The fee for said license shall be Twentyfive Dollars ($25.00).&nbsp;</span></p> <p><span class="cls0">The license of any rating organization may be suspended or revoked by the Board for failure to comply with this law or for incompetence or untrustworthiness. The Board shall not revoke or suspend the license of any rating organization until it has given it not less than thirty (30) days notice of the proposed revocation or suspension and of the grounds alleged therefor and has afforded the rating organization an opportunity to be heard. In lieu of revoking or suspending the license of any rating organization after hearing and for the causes named herein, the Board may subject such rating organization to a penalty of not more than Two Hundred Fifty Dollars ($250.00) when in its judgment it finds that the public interest would be best served by the continued operation of the rating organization.&nbsp;</span></p> <p><span class="cls0">D. Every licensed rating organization shall, subject to reasonable rules and regulations, permit any insurer not a member to be subscriber to its rating services for any kind of insurance, or subdivision thereof for which it is authorized to act; shall give notice of changes in such rules and regulations to its subscribers; and shall furnish its rating services without discrimination to its members and subscribers.&nbsp;</span></p> <p><span class="cls0">E. No licensed rating organization shall adopt any rule, effect any agreement, or take any action contrary to or inconsistent with the provisions of this law or which would have the effect of prohibiting, restricting, or regulating the payment or allowance by any of its members or subscribers of dividends, savings, or unabsorbed premium deposits; nor practice or sanction any plan or act of boycott, coercion, or intimidation; nor enter into or sanction any contract or act by which any person is restrained from lawfully engaging in the business of insurance.&nbsp;</span></p> <p><span class="cls0">F. Every member of or a subscriber to a licensed rating organization shall adhere to the filings made on its behalf by such organization except that any such member or subscriber may deviate from such filing if it has filed with the rating organization and with the Board, at least fifteen (15) days before the effective date thereof, the deviation to be applied and the information upon which such deviation is based. The Board shall disapprove such deviation if it finds that the deviation to applied would not be uniform in its application or would be inconsistent with the provisions of this article.&nbsp;</span></p> <p><span class="cls0">&sect;36-907. General powers of the Commissioner.&nbsp;</span></p> <p><span class="cls0">In addition to any powers hereinbefore expressly enumerated in this law, the Commissioner shall have full power and authority to enforce by regulations, orders, or otherwise all and singular, the provisions of this law, and the full intent thereof. In particular it shall have the authority and power:&nbsp;</span></p> <p><span class="cls0">1. To examine all records of insurers and advisory organizations and to require any insurer, agent, broker and advisory organization to furnish under oath such information as it may deem necessary for the administration of this law. The expense of such examination shall be paid by the insurer or advisory organization examined. In lieu of such examination, the Commissioner may, in the discretion of the Commissioner, accept a report of examination made by any other insurance supervisory authority;&nbsp;</span></p> <p><span class="cls0">2. To make and enforce such reasonable orders, rules, and regulations as may be necessary in making this law effective, but such orders, rules and regulations shall not be contrary to or inconsistent with the provisions of this law; and&nbsp;</span></p> <p><span class="cls0">3. To issue an order, after a full hearing to all parties in interest requiring any insurer, group, association, or organization of insurers and the members and subscribers thereof to cease and desist from any unfair or unreasonable practice.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 247, &sect; 907, operative July 1, 1957. Amended by Laws 1987, c. 210, &sect; 22, eff. July 1, 1987; Laws 2006, c. 264, &sect; 19, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-907.1. Monitoring and examination of rates.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall monitor and examine the adequacy of rates of any insurer and advisory organization in this state. In so doing, the Commissioner shall:&nbsp;</span></p> <p><span class="cls0">1. Utilize existing relevant information, analytical systems and other sources; or&nbsp;</span></p> <p><span class="cls0">2. Cause or participate in the development of new relevant information, analytical systems and other sources.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner may require the maintenance and submission of records, memoranda or information relating to rates from such insurers and advisory organizations. The Commissioner or any authorized representative of the Commissioner may examine any such record, memoranda or information concerning rates. The application for the acceptance of any license or permit issued pursuant to the provision of this title shall be deemed consent for the inspection and examination of such records, memoranda or information.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner shall conduct such monitoring and examination required pursuant to this section within the Insurance Department, at the place of business of such insurers and advisory organizations, in cooperation with other state insurance departments, through outside contractors or in any other appropriate manner.&nbsp;</span></p> <p><span class="cls0">D. The cost of such examination and monitoring shall be assessed against insurers and advisory organizations on an equitable and practical basis established, after hearing, in a rule promulgated by the Commissioner.&nbsp;</span></p> <p><span class="cls0">E. The monitoring and examinations required pursuant to the provisions of this section, shall be conducted in a reasonably economical manner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1985, c. 236, &sect; 4, emerg. eff. July 8, 1985. Amended by Laws 1987, c. 210, &sect; 23, eff. July 1, 1987; Laws 2006, c. 264, &sect; 20, eff. July 1, 2006; Laws 2009, c. 432, &sect; 8, eff. July 1, 2009.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-908. Administrative penalties.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner may, if the Commissioner finds that any person or organization has violated the provisions of any statute for which the Commissioner has jurisdiction, impose a penalty of not less than One Hundred Dollars ($100.00) nor more than Five Thousand Dollars ($5,000.00) for each such violation. Such penalties may be in addition to any other penalty provided by law.&nbsp;</span></p> <p><span class="cls0">No penalty shall be imposed except upon a written order of the Commissioner, stating the findings of the Commissioner made after a hearing held not less than ten (10) days after written notice to a person or organization alleged to have violated any statute for which the Commissioner has jurisdiction specifying the alleged violation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 247, &sect; 908, operative July 1, 1957. Amended by Laws 1983, c. 68, &sect; 8, eff. Nov. 1, 1983; Laws 1987, c. 210, &sect; 24, eff. July 1, 1987; Laws 1997, c. 418, &sect; 36, eff. Nov. 1, 1997; Laws 2006, c. 264, &sect; 21, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-924.1. Automobile or motorcycle accident prevention course for certain individuals - Reduction of premium charges.&nbsp;</span></p> <p><span class="cls0">A. Any schedule of rates or rating plan for automobile or motorcycle liability and physical damage insurance submitted to or filed with the State Insurance Commissioner shall provide for an appropriate reduction in premium charges for those insured persons for a three-year period after successfully completing a motor vehicle accident prevention course which shall include but not be limited to an automobile or motorcycle accident prevention course as approved by the insurance company of the policyholder. Provided, however, there shall be no reduction in premiums for a selfinstructed course or a course which does not provide for actual classroom or field driving instruction for a minimum number of hours as provided in subsection E of this section. Provided further, there shall be no reduction in premiums for a course attended pursuant to a court order in connection with a motor vehicle violation or an alcohol- or drug-related offense.&nbsp;</span></p> <p><span class="cls0">B. All insurance companies writing automobile or motorcycle liability and physical damage insurance in this state shall allow an appropriate reduction in premium charges to all eligible persons pursuant to this section.&nbsp;</span></p> <p><span class="cls0">C. Upon successfully completing the approved course, each participant shall be issued by the sponsoring agency of the course, a certificate which shall be the basis of qualification for the discount on insurance.&nbsp;</span></p> <p><span class="cls0">D. Each participant shall successfully complete an approved course each three (3) years to continue to be eligible for the discount on insurance.&nbsp;</span></p> <p><span class="cls0">E. An approved course pursuant to this section shall provide at least six (6) hours of instruction.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1985, c. 122, &sect; 1, eff. Jan. 1, 1986. Amended by Laws 1990, c. 297, &sect; 1, eff. Sept. 1, 1990; Laws 1991, c. 204, &sect; 11, eff. Sept. 1, 1991; Laws 1995, c. 138, &sect; 1, eff. Nov. 1, 1995; Laws 2002, c. 49, &sect; 1, eff. Nov. 1, 2002; Laws 2004, c. 519, &sect; 8, eff. Nov. 1, 1004; Laws 2007, c. 326, &sect; 1, eff. Nov. 1, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-924.2. Rating plans for workers' compensation self-insureds - Reduced premium charges for successful participation in occupational safety and health programs - Qualification - Certificate - Records - Review of premium credit program.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">A. Any rate, schedule of rates or rating plan for workers' compensation insurance submitted to or filed with the Insurance Commissioner, or fixed by the Board of Managers of CompSource Oklahoma, and premiums, by whatever name, for workers' compensation for selfinsureds except for group selfinsured associations shall provide for an appropriate reduction in premium charges, by whatever name, for those eligible insured employers who have successfully participated in the occupational safety and health consultation, education and training program administered by the Commissioner of the Department of Labor pursuant to Section 414 of Title 40 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">B. All insurance companies writing workers' compensation insurance in this state, including CompSource Oklahoma, and all selfinsureds providing workers' compensation insurance except for group selfinsured associations, shall allow an appropriate reduction in premium charges to all eligible employers who qualify for the reduction pursuant to the provisions of this section.&nbsp;</span></p> <p><span class="cls0">C. Eligible employers shall be those employers:&nbsp;</span></p> <p><span class="cls0">1. Who are insured by an insurance company writing workers' compensation insurance in this state;&nbsp;</span></p> <p><span class="cls0">2. Who are selfinsured; or&nbsp;</span></p> <p><span class="cls0">3. Who are insured by CompSource Oklahoma.&nbsp;</span></p> <p><span class="cls0">D. In order to qualify for the reduction in workers' compensation insurance premium, an employer shall successfully participate annually in the occupational safety and health consultation, education and training program administered by the Department of Labor. Successful participation shall be defined as:&nbsp;</span></p> <p><span class="cls0">1. Undergoing a safety and health hazard survey of the workplace, including an evaluation of the employer's safety and health program and onsite interviews with employees by the Department's consultant;&nbsp;</span></p> <p><span class="cls0">2. Correcting all hazards identified during the onsite visit within a reasonable period of time as established by the Department;&nbsp;</span></p> <p><span class="cls0">3. Establishing an effective workplace safety and health program and implementing program provisions within a reasonable period of time as established by the Department. The program shall include:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;demonstration of management commitment to worker safety and health,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;procedures for identifying and controlling workplace hazards,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;development and communication of safety plans, rules and work procedures, and&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;training for supervisors and employees in safe and healthful work practices;&nbsp;</span></p> <p><span class="cls0">4. Reducing by onethird (1/3) or more the extent to which the lost workday case rate, as measured by the Department of Labor, was above the national average for the industry at the time the employer elected to participate in the occupational safety and health consultation, education and training program, or maintaining a rate at or below the national average for the industry; and&nbsp;</span></p> <p><span class="cls0">5. Documenting a reduction in workers' compensation claims for the preceding year by showing one of the following:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;a ten percent (10%) reduction in the dollar amount of claims,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;a ten percent (10%) reduction in the severity of claims, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;no reported claims,&nbsp;</span></p> <p><span class="cls0">as a result of attending the occupational safety and health consultation, education and training program administered by the Department of Labor.&nbsp;</span></p> <p><span class="cls0">E. 1. Upon successful participation in the occupational safety and health consultation, education and training program as defined in subsection D of this section, an employer shall be issued a certificate by the Commissioner of the Department of Labor which shall be the basis of qualification for the reduction in workers' compensation insurance premium, by whatever name. The certificate shall qualify the employer for a premium reduction for a oneyear period.&nbsp;</span></p> <p><span class="cls0">2. Upon issuance of a certificate to an employer, the Commissioner of the Department of Labor shall mail a copy of the certificate to the employer's insurer. Any insurer required by this section to allow an appropriate reduction in premium charges to a qualified employer which willfully fails to allow such reduction after receiving a copy of the certificate shall be subject, after notice and hearing, to an administrative fine, imposed by the Insurance Commissioner, which shall be not less than Ten Thousand Dollars ($10,000.00) or three times the amount of the premium reduction, whichever is greater. The Insurance Commissioner shall promulgate rules necessary to carry out the provisions of this paragraph.&nbsp;</span></p> <p><span class="cls0">F. The Insurance Commissioner, the Administrator of the Workers' Compensation Court and the CompSource Oklahoma President and Chief Executive Officer shall maintain records documenting reductions in workers' compensation insurance premiums granted pursuant to this section and shall make an annual report of such reductions to the President Pro Tempore of the Senate and the Speaker of the House of Representatives by May 1 of each year. Insurers shall report such premium reductions in their annual statement.&nbsp;</span></p> <p><span class="cls0">G. CompSource Oklahoma shall instruct its actuary to continually review the insurance premium credit program, developed and implemented pursuant to Section 142a of Title 85 of the Oklahoma Statutes, to determine if the program is detrimental to the financial stability of CompSource Oklahoma. If the actuary determines that the program contributes detrimentally to the financial stability of CompSource Oklahoma, the actuary shall immediately recommend to the CompSource Oklahoma President and Chief Executive Officer that the safety premium reduction cease for a one-year period.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1988, c. 317, &sect; 1, eff. Nov. 1, 1988. Amended by Laws 1990, c. 2, &sect; 1, eff. Sept. 1, 1990; Laws 1993, c. 349, &sect; 24, eff. Sept. 1, 1993; Laws 1994, c. 129, &sect; 5, eff. Sept. 1, 1994; Laws 2002, c. 50, &sect; 1, eff. Nov. 1, 2002; Laws 2006, c. 264, &sect; 22, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">&sect;36-924.2. Rating plans for workers' compensation self-insureds - Reduced premium charges for successful participation in occupational safety and health programs - Qualification - Certificate - Records.&nbsp;</span></p> <p><span class="cls0">A. Any rate, schedule of rates or rating plan for workers' compensation insurance submitted to or filed with the Insurance Commissioner, or fixed by the Board of Directors of CompSource Mutual Insurance Company, and premiums, by whatever name, for workers' compensation for self-insureds except for group self-insured associations shall provide for an appropriate reduction in premium charges, by whatever name, for those eligible insured employers who have successfully participated in the occupational safety and health consultation, education and training program administered by the Commissioner of the Department of Labor pursuant to Section 414 of Title 40 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">B. All insurance companies writing workers' compensation insurance in this state and all self-insureds providing workers' compensation insurance except for group self-insured associations, shall allow an appropriate reduction in premium charges to all eligible employers who qualify for the reduction pursuant to the provisions of this section.&nbsp;</span></p> <p><span class="cls0">C. Eligible employers shall be those employers:&nbsp;</span></p> <p><span class="cls0">1. Who are insured by an insurance company writing workers' compensation insurance in this state; or&nbsp;</span></p> <p><span class="cls0">2. Who are self-insured.&nbsp;</span></p> <p><span class="cls0">D. In order to qualify for the reduction in workers' compensation insurance premium, an employer shall successfully participate annually in the occupational safety and health consultation, education and training program administered by the Department of Labor. Successful participation shall be defined as:&nbsp;</span></p> <p><span class="cls0">1. Undergoing a safety and health hazard survey of the workplace, including an evaluation of the employer's safety and health program and onsite interviews with employees by the Department's consultant;&nbsp;</span></p> <p><span class="cls0">2. Correcting all hazards identified during the onsite visit within a reasonable period of time as established by the Department;&nbsp;</span></p> <p><span class="cls0">3. Establishing an effective workplace safety and health program and implementing program provisions within a reasonable period of time as established by the Department. The program shall include:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;demonstration of management commitment to worker safety and health,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;procedures for identifying and controlling workplace hazards,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;development and communication of safety plans, rules and work procedures, and&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;training for supervisors and employees in safe and healthful work practices;&nbsp;</span></p> <p><span class="cls0">4. Reducing by one-third (1/3) or more the extent to which the lost workday case rate, as measured by the Department of Labor, was above the national average for the industry at the time the employer elected to participate in the occupational safety and health consultation, education and training program, or maintaining a rate at or below the national average for the industry; and&nbsp;</span></p> <p><span class="cls0">5. Documenting a reduction in workers' compensation claims for the preceding year by showing one of the following:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;a ten percent (10%) reduction in the dollar amount of claims,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;a ten percent (10%) reduction in the severity of claims, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;no reported claims,&nbsp;</span></p> <p><span class="cls0">as a result of attending the occupational safety and health consultation, education and training program administered by the Department of Labor.&nbsp;</span></p> <p><span class="cls0">E. 1. Upon successful participation in the occupational safety and health consultation, education and training program as defined in subsection D of this section, an employer shall be issued a certificate by the Commissioner of the Department of Labor which shall be the basis of qualification for the reduction in workers' compensation insurance premium, by whatever name. The certificate shall qualify the employer for a premium reduction for a one-year period.&nbsp;</span></p> <p><span class="cls0">2. Upon issuance of a certificate to an employer, the Commissioner of the Department of Labor shall mail a copy of the certificate to the employer's insurer. Any insurer required by this section to allow an appropriate reduction in premium charges to a qualified employer which willfully fails to allow such reduction after receiving a copy of the certificate shall be subject, after notice and hearing, to an administrative fine, imposed by the Insurance Commissioner, which shall be not less than Ten Thousand Dollars ($10,000.00) or three times the amount of the premium reduction, whichever is greater. The Insurance Commissioner shall promulgate rules necessary to carry out the provisions of this paragraph.&nbsp;</span></p> <p><span class="cls0">F. The Insurance Commissioner and the Administrator of the Workers' Compensation Court shall maintain records documenting reductions in workers' compensation insurance premiums granted pursuant to this section and shall make an annual report of such reductions to the President Pro Tempore of the Senate and the Speaker of the House of Representatives by May 1 of each year. Insurers shall report such premium reductions in their annual statement.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1988, c. 317, &sect; 1, eff. Nov. 1, 1988. Amended by Laws 1990, c. 2, &sect; 1, eff. Sept. 1, 1990; Laws 1993, c. 349, &sect; 24, eff. Sept. 1, 1993; Laws 1994, c. 129, &sect; 5, eff. Sept. 1, 1994; Laws 2002, c. 50, &sect; 1, eff. Nov. 1, 2002; Laws 2006, c. 264, &sect; 22, eff. July 1, 2006; Laws 2013, c. 254, &sect; 17, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-924.3. Appeals of rating classifications.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner shall adopt rules and regulations creating a procedure for an employer to appeal its rating classification for workers' compensation insurance to the Commissioner. Any hearings pursuant to this procedure shall be subject to the Administrative Procedures Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1990, c. 283, &sect; 21, eff. Sept. 1, 1990. Amended by Laws 2006, c. 264, &sect; 23, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-924.4. Affidavit of exempt status - Presumption that employee is not covered by Workers' Compensation Act - Providing false information - Penalty - Revolving fund.&nbsp;</span></p> <p><span class="cls0">A. Any person who is not required to be covered under a workers' compensation insurance policy or other plan for the payment of workers' compensation may execute an Affidavit of Exempt Status under the Workers' Compensation Act. The affidavit shall be a form prescribed by the Insurance Commissioner. The affidavit shall be available on the web site of the Insurance Department.&nbsp;</span></p> <p><span class="cls0">B. Execution of the affidavit shall establish a rebuttable presumption that the executor is not an employee for purposes of the Workers' Compensation Act and that an individual or company possessing the affidavit is in compliance and therefore shall not be responsible for workers' compensation claims made by the executor.&nbsp;</span></p> <p><span class="cls0">C. Except as otherwise provided in Section 314 of Title 85 of the Oklahoma Statutes, the execution of an affidavit shall not affect the rights or coverage of any employee of the individual executing the affidavit.&nbsp;</span></p> <p><span class="cls0">D. 1. Knowingly providing false information on a notarized Affidavit of Exempt Status Under the Workers' Compensation Act shall constitute a misdemeanor punishable by a fine not to exceed One Thousand Dollars ($1,000.00).&nbsp;</span></p> <p><span class="cls0">2. Affidavits shall conspicuously state on the front thereof in at least ten-point, bold-faced print that it is a crime to falsify information on the form.&nbsp;</span></p> <p><span class="cls0">3. The Insurance Commissioner shall immediately notify the Workers' Compensation Fraud Unit in the Office of the Attorney General of any violations or suspected violations of this section. The Commissioner shall cooperate with the Fraud Unit in any investigation involving affidavits executed pursuant to this section.&nbsp;</span></p> <p><span class="cls0">E. Application fees collected pursuant to this section shall be deposited in the State Treasury to the credit of the State Insurance Commissioner's Revolving Fund.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 75, emerg. eff. June 7, 2006. Amended by Laws 2009, c. 177, &sect; 1, eff. Nov. 1, 2009; Laws 2010, c. 222, &sect; 7, eff. Nov. 1, 2010; Laws 2012, c. 44, &sect; 1, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-924.5. Knowingly and willfully requiring submission of false affidavit of exempt status - Penalties.&nbsp;</span></p> <p><span class="cls0">In addition to any other penalty prescribed by law, any employer who knowingly and willfully requires an employee or subcontractor to execute an affidavit under Section 924.4 of this title when the employer knows that the employee or subcontractor is required to be covered under a workers' compensation insurance policy or other plan for the payment of workers' compensation shall be liable for a civil penalty, to be assessed by the Insurance Department, of not more than Five Hundred Dollars ($500.00) for a first offense, and shall be liable for a civil penalty of not more than One Thousand Dollars ($1,000.00) for a second or subsequent offense. All civil penalties collected pursuant to this section shall be deposited into the State Insurance Commissioner's Revolving Fund.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 76, emerg. eff. June 7, 2006. Amended by Laws 2012, c. 44, &sect; 2, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-928. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-929. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-930. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-931. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-932. Joint underwriting or joint reinsurance.&nbsp;</span></p> <p><span class="cls0">A. Every group, association or other organization of insurers which engages in joint underwriting or joint reinsurance, shall be subject to regulation with respect thereto, as herein provided, subject, with respect to joint underwriting, to all other provisions of this act, and with respect to joint reinsurance as provided in this act.&nbsp;</span></p> <p><span class="cls0">B. If, after a hearing, the Insurance Commissioner finds that any activity or practice of any such group, association or other organization, is unfair or unreasonable, or otherwise inconsistent with the provisions of this act, the Commissioner may issue a written order specifying in what respects such act or practice is unfair or unreasonable or otherwise inconsistent with the provisions of this act, and require the discontinuance, within a reasonable time under the circumstances, of such act or practice.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1980, c. 322, &sect; 26, eff. Jan. 1, 1981. Amended by Laws 1987, c. 210, &sect; 29, eff. July 1, 1987; Laws 2006, c. 264, &sect; 24, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-933. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-934. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-935. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-936. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-937. Hearing on order or decision by Commission made without a hearing - Appeal to Supreme Court.&nbsp;</span></p> <p><span class="cls0">A. Any insurer or advisory organization aggrieved by any order or decision of the Insurance Commissioner, made without a hearing, may, within thirty (30) days after notice of the order to the insurer or organization, make written request to the Commissioner for a hearing thereon. The Commissioner shall hear such party or parties within twenty (20) days after receipt of such request and shall give not less than ten (10) days' written notice of the time and place of the hearing. Within fifteen (15) days after such hearing, the Commissioner shall affirm, reverse or modify the previous action of the Commissioner, specifying its reasons therefor. Pending such hearing and decision thereon, the Commissioner may suspend or postpone the effective date of the previous action of the Commissioner.&nbsp;</span></p> <p><span class="cls0">B. Nothing contained in this act shall require the observance at any hearing, of formal rules of pleading or evidence.&nbsp;</span></p> <p><span class="cls0">C. Except as otherwise provided in this act, any order or decision of the Commissioner made pursuant to this act shall be subject to review by appeal to the Supreme Court of Oklahoma at the instance of any party in interest. Such party in interest may appeal from such order or decision by filing with the Clerk of the Supreme Court, within thirty (30) days from the date of such order or decision, a petition in error with a copy of the order or decision appealed from. The time limit prescribed herein for filing the petition in error may not be extended. The Supreme Court shall prescribe, by rule, the manner in which the record of the proceedings, sought to be reviewed, shall be perfected and the time for its completion. The appeal shall not stay the execution of any order or decision of the Commissioner unless the Supreme Court shall, for cause shown, order that said decision or order be stayed pending such appeal, in which event the Court shall determine the terms and conditions upon which the same shall be stayed; provided, premiums collected prior to the effective date of the order of the Court imposing a stay shall be retained by the insurer unless the Court finds that such premiums were obtained by fraud, or unless otherwise ordered by the Court.&nbsp;</span></p> <p><span class="cls0">The Court may, in disposing of the issue before it, determine all issues of law and fact, and may modify, affirm or reverse the order or decisions of the Commissioner in whole or in part.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1980, c. 322, &sect; 31, eff. Jan. 1, 1981. Amended by Laws 1988, c. 28, &sect; 1, eff. Nov. 1, 1988; Laws 2006, c. 264, &sect; 25, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-940. Inquiry regarding making claim &ndash; Prohibited acts.&nbsp;</span></p> <p><span class="cls0">No insurer that issues any type of property or casualty insurance policy in this state shall increase premium rates, cancel a policy, or refuse to issue or renew a policy solely on the basis of a policyholder inquiring about making a claim, if the policyholder does not in fact submit a claim.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2004, c. 32, &sect; 1, eff. Nov. 1, 2004.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36941. Certain cancellation, refusal to renew or increase of premium rate for motor vehicle liability or collision insurance policies prohibited Exemptions.&nbsp;</span></p> <p><span class="cls0">A. No insurance carrier who issues motor vehicle insurance policies in this state shall assign driving record points, cancel, refuse to issue or renew, or charge a higher premium rate for any motor vehicle liability or collision insurance policy for the reason that the insured has been involved in a motor vehicle collision and was not at fault.&nbsp;</span></p> <p><span class="cls0">B. No insurance carrier who issues motor vehicle insurance policies in this state shall cancel, refuse to issue or renew, or charge a higher premium for any motor vehicle liability or collision insurance policy for the reason that the insured had lower liability limits with a previous insurer without actuarial justification. This prohibition includes using prior limits for company or tier placement unless the insurer provides actuarial justification.&nbsp;</span></p> <p><span class="cls0">C. This section shall not apply to an insured who has been convicted of:&nbsp;</span></p> <p><span class="cls0">1. Homicide or assault arising out of the operation of any motor vehicle; or&nbsp;</span></p> <p><span class="cls0">2. A violation of Section 11902 or 761 of Title 47 of the Oklahoma Statutes as being impaired by or under the influence of alcohol or intoxicating liquor or who was under the influence of any substance included in the Uniform Controlled Dangerous Substances Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1980, c. 99, &sect; 1, eff. Oct. 1, 1980. Amended by Laws 1984, c. 254, &sect; 4, eff. Nov. 1, 1984; Laws 1988, c. 27, &sect; 1, eff. Nov. 1, 1988. Renumbered from &sect; 7508 of Title 47 by Laws 1988, c. 27, &sect; 4, eff. Nov. 1, 1988. Amended by Laws 2001, c. 363, &sect; 10, eff. July 1, 2001; Laws 2004, c. 519, &sect; 10, eff. Nov. 1, 2004; Laws 2005, c. 1, &sect; 38, emerg. eff. March 15, 2005.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2004, c. 96, &sect; 1 repealed by Laws 2005, c. 1, &sect; 39, emerg. eff. March 15, 2005.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-941.2. Motor vehicle liability policies &ndash; Provision relating to financial responsibility limits of another state or province.&nbsp;</span></p> <p><span class="cls0">Every motor vehicle liability insurance policy approved by the Insurance Commissioner shall include a provision providing that the financial responsibility limits of another state or province shall be met if so required by the other state and if the financial responsibility limits of the other state or province are higher than those required by the state where the motor vehicle is principally garaged. The policy does not have to contain the exact wording of this section or any other exact wording. Language which is substantially similar to this section shall be considered to be in compliance with this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2004, c. 96, &sect; 2, eff. Nov. 1, 2004.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-942. Motor vehicle liability or collision policies - Traffic record as basis of determination - Penalties.&nbsp;</span></p> <p><span class="cls0">Any insurance carrier that issues motor vehicle liability or collision insurance policies in this state shall not establish or apply premium rates, increase premium rates, cancel a policy, or refuse to issue or renew a policy, based on any traffic record maintained by the Department of Public Safety which covers a period of time more than three (3) years prior to the date the insurance carrier makes a determination to take any such action; provided however, those offenses that are provided for in subsection C of Section 941 of this title and the offense of reckless driving as provided for in Section 11-901 of Title 47 of the Oklahoma Statutes may be considered by an insurance carrier for a period of not more than five (5) years.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1988, c. 27, &sect; 2, eff. Nov. 1, 1988. Amended by Laws 2004, c. 519, &sect; 11, eff. Nov. 1, 2004; Laws 2006, c. 322, &sect; 3, eff. July 1, 2006.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-943. Motor vehicle policies - Insurers prohibited from canceling, increasing premium rates or refusing to issue or renew policy based on traffic charges under certain circumstances.&nbsp;</span></p> <p><span class="cls0">A. No insurance carrier who issues motor vehicle policies in this state shall use traffic complaints, traffic citations or other legal forms of traffic charges as a basis for cancellation of a motor vehicle insurance policy, increasing premium rates for a motor vehicle insurance policy or refusing to issue or renew a motor vehicle insurance policy, where:&nbsp;</span></p> <p><span class="cls0">1. the insured was acquitted of the charge;&nbsp;</span></p> <p><span class="cls0">2. the insured was arrested and no charges were filed; or&nbsp;</span></p> <p><span class="cls0">3. the insured was arrested and the charges were dismissed.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner may suspend or revoke, after notice and hearing, the certificate of authority to transact insurance business in this state of any insurance carrier violating the provisions of this section or may censure the insurer or impose a fine.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1990, c. 81, &sect; 1, eff. Sept. 1, 1990.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-944. Motor vehicle policies - Restriction on cancellation or increasing rates.&nbsp;</span></p> <p><span class="cls0">No insurer shall, directly or indirectly, use traffic tickets or convictions for traffic offenses as a basis for cancellation of automobile insurance policies or increasing insurance premium rates for automobile insurance policies where such ticket or conviction is for exceeding the speed limit specified in Article 8 of Chapter 11 of Title 47 of the Oklahoma Statutes, but not exceeding the speed limit previously in force where the violation occurred; nor shall any insurer in any way penalize or adversely affect any insured for any such violation or conviction.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1974, c. 3, &sect; 2, operative March 4, 1974. Amended by Laws 1987, c. 25, &sect; 2, emerg. eff. April 15, 1987. Renumbered from &sect; 11-801b of Title 47 by Laws 2002, c. 397, &sect; 35, eff. Nov. 1, 2002. Amended by Laws 2005, c. 129, &sect; 6, eff. Nov. 1, 2005.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-950. Short title.&nbsp;</span></p> <p><span class="cls0">This act shall be known and may be cited as the &ldquo;Use of Credit Information in Personal Insurance Act&rdquo;.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 1, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-951. Application of act.&nbsp;</span></p> <p><span class="cls0">This act shall apply to personal insurance and not to commercial insurance. This act shall apply to personal insurance policies either written to be effective or renewed on or after nine (9) months following the effective date of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 2, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-952. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in this act:&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Adverse action&rdquo; means a denial or cancellation of, an increase in any charge for, or a reduction or other adverse or unfavorable change in the terms of coverage or amount of, any insurance, existing or applied for, in connection with the underwriting of personal insurance;&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Affiliate&rdquo; means any company that controls, is controlled by, or is under common control with another company;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Applicant&rdquo; means an individual who has applied to be covered by a personal insurance policy with an insurer;&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Consumer&rdquo; means an insured whose credit information is used or whose insurance score is calculated in the underwriting or rating of a personal insurance policy or an applicant for such a policy;&nbsp;</span></p> <p><span class="cls0">5. &ldquo;Consumer reporting agency&rdquo; means any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties;&nbsp;</span></p> <p><span class="cls0">6. &ldquo;Credit information&rdquo; means any credit-related information derived from a credit report, found on a credit report itself, or provided on an application for personal insurance. Information that is not credit-related shall not be considered "credit information&rdquo;, regardless of whether it is contained in a credit report or in an application, or is used to calculate an insurance score;&nbsp;</span></p> <p><span class="cls0">7. &ldquo;Credit report&rdquo; means any written, oral, or other communication of information by a consumer reporting agency bearing on a consumer&rsquo;s credit worthiness, credit standing or credit capacity which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor to determine personal insurance premiums, eligibility for coverage, or tier placement;&nbsp;</span></p> <p><span class="cls0">8. &ldquo;Insurance score&rdquo; means a number or rating that is derived from an algorithm, computer application, model, or other process that is based in whole or in part on credit information for the purposes of predicting the future insurance loss exposure of an individual applicant or insured; and&nbsp;</span></p> <p><span class="cls0">9. &ldquo;Personal insurance&rdquo; means private passenger automobile, homeowners, motorcycle, mobile-homeowners and noncommercial dwelling fire insurance policies and boat, personal watercraft, snowmobile and recreational vehicle policies. Such policies must be individually underwritten for personal, family or household use. No other type of insurance shall be included as personal insurance for the purpose of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 3, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-953. Use of credit information - Prohibited acts.&nbsp;</span></p> <p><span class="cls0">An insurer authorized to do business in this state that uses credit information to underwrite or rate risks, shall not:&nbsp;</span></p> <p><span class="cls0">1. Use an insurance score that is calculated using income, gender, address, zip code, ethnic group, religion, marital status, or nationality of the consumer as a factor;&nbsp;</span></p> <p><span class="cls0">2. Deny, cancel or fail to renew a policy of personal insurance solely on the basis of credit information, without consideration of any other applicable underwriting factor independent of credit information and not expressly prohibited by paragraph 1 of this section;&nbsp;</span></p> <p><span class="cls0">3. Base renewal rates for personal insurance of an insured solely upon credit information, without consideration of any other applicable factor independent of credit information;&nbsp;</span></p> <p><span class="cls0">4. Take adverse action against a consumer solely because the consumer does not have a credit card account, without consideration of any other applicable factor independent of credit information;&nbsp;</span></p> <p><span class="cls0">5. Consider an absence of credit information or an inability to calculate an insurance score in underwriting or rating personal insurance, unless the insurer does one of the following:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;treats the consumer as otherwise approved by the Insurance Commissioner, if the insurer presents information that an absence or inability relates to the risk for the insurer,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;treats the consumer as if the applicant or insured had neutral credit information, as defined by the insurer, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;excludes the use of credit information as a factor and use only other underwriting criteria;&nbsp;</span></p> <p><span class="cls0">6. Take an adverse action against a consumer based on credit information, unless an insurer obtains and uses a credit report issued or an insurance score calculated within ninety (90) days from the date the policy is first written or renewal is issued;&nbsp;</span></p> <p><span class="cls0">7. Use credit information unless not later than every thirty-six (36) months following the last time that the insurer obtained current credit information for the insured, the insurer recalculates the insurance score or obtains an updated credit report. Regardless of the requirements of this subsection:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;at annual renewal, upon the request of a consumer or the agent of the consumer, the insurer shall reunderwrite and rerate the policy based upon a current credit report or insurance score. An insurer need not recalculate the insurance score or obtain the updated credit report of a consumer more frequently than once in a twelve-month period,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the insurer shall have the discretion to obtain current credit information upon any renewal before the thirty-six (36) months, if consistent with its underwriting guidelines, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;no insurer need obtain current credit information for an insured, despite the requirements of paragraph 7 of this section, if one of the following applies:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;the insurer is treating the consumer as otherwise approved by the Commissioner,&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;the insured is in the most favorably priced tier of the insurer, within a group of affiliated insurers. However, the insurer shall have the discretion to order a report, if consistent with its underwriting guidelines,&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;credit was not used for underwriting or rating the insured when the policy was initially written. However, the insurer shall have the discretion to use credit for underwriting or rating the insured upon renewal, if consistent with its underwriting guidelines, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(4)&nbsp;&nbsp;the insurer reevaluates the insured beginning no later than thirty-six (36) months after inception and thereafter based upon other underwriting or rating factors, excluding credit information; and&nbsp;</span></p> <p><span class="cls0">8. Use the following as a negative factor in any insurance scoring methodology or in reviewing credit information for the purpose of underwriting or rating a policy of personal insurance:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;credit inquiries not initiated by the consumer or inquiries requested by the consumer for the credit information of the consumer,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;inquiries relating to insurance coverage, if so identified on a credit report of the consumer,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;collection accounts with a medical industry code, if so identified on the credit report of the consumer,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;multiple lender inquiries, if coded by the consumer reporting agency on the credit report of the consumer as being from the home mortgage industry and made within thirty (30) days of one another, unless only one inquiry is considered, and&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;multiple lender inquiries, if coded by the consumer reporting agency on the credit report of the consumer as being from the automobile lending industry and made within thirty (30) days of one another, unless only one inquiry is considered.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 4, eff. Nov. 1, 2003. Amended by Laws 2010, c. 222, &sect; 8, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-954. Reunderwriting and rerating of insured - Refund of overpayment.&nbsp;</span></p> <p><span class="cls0">If it is determined through the dispute resolution process set forth in the federal Fair Credit Reporting Act, 15 USC 1681i(a)(5), that the credit information of a current insured was incorrect or incomplete and if the insurer receives notice of such determination from either the consumer reporting agency or from the insured, the insurer shall reunderwrite and rerate the consumer within thirty (30) days of receiving the notice. After reunderwriting or rerating the insured, the insurer shall make any adjustments necessary, consistent with its underwriting and rating guidelines. If an insurer determines that the insured has overpaid premium, the insurer shall refund to the insured the amount of overpayment calculated back to the shorter of either the last twelve (12) months of coverage or the actual policy period.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 5, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-955. Disclosure statement.&nbsp;</span></p> <p><span class="cls0">A. If an insurer writing personal insurance uses credit information in underwriting or rating a consumer, the insurer or its agent shall disclose, either on the insurance application or at the time the insurance application is taken, that it may obtain credit information in connection with such application. Such disclosure shall be either written or provided to an applicant in the same medium as the application for insurance. The insurer need not provide the disclosure statement required under this section to any insured on a renewal policy, if such consumer has previously been provided a disclosure statement.&nbsp;</span></p> <p><span class="cls0">B. Use of the following example disclosure statement constitutes compliance with this section: &ldquo;In connection with this application for insurance, we may review your credit report or obtain or use a credit-based insurance score based on the information contained in that credit report. We may use a third party in connection with the development of your insurance score&rdquo;.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 6, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-956. Adverse action based upon credit information - Notification to consumer.&nbsp;</span></p> <p><span class="cls0">If an insurer takes an adverse action based upon credit information, the insurer shall:&nbsp;</span></p> <p><span class="cls0">1. Provide notification to the consumer that an adverse action has been taken, in accordance with the requirements of the federal Fair Credit Reporting Act, 15 USC 1681m(a); and&nbsp;</span></p> <p><span class="cls0">2. Provide notification to the consumer explaining the reason for the adverse action. The reasons must be provided in sufficiently clear and specific language so that a person can identify the basis for the insurer&rsquo;s decision to take an adverse action. Such notification shall include a description of up to four factors that were the primary influences of the adverse action. The use of generalized terms such as &ldquo;poor credit history&rdquo;, &ldquo;poor credit rating&rdquo;, or &ldquo;poor insurance score&rdquo; does not meet the explanation requirements of this subsection. Standardized credit explanations provided by consumer reporting agencies or other third-party vendors are deemed to comply with this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 7, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-957. Filing of scoring models or other scoring processes.&nbsp;</span></p> <p><span class="cls0">A. Insurers that use insurance scores to underwrite and rate risks must file their scoring models or other scoring processes with the Insurance Department. A third party may file scoring models on behalf of insurers. A filing that includes insurance scoring may include loss experience justifying the use of credit information.&nbsp;</span></p> <p><span class="cls0">B. Any filing relating to credit information is considered trade secret under Section 85 et seq. of Title 78 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 8, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-958. Indemnification of agents.&nbsp;</span></p> <p><span class="cls0">An insurer shall indemnify, defend, and hold agents harmless from and against all liability, fees, and costs arising out of or relating to the actions, errors, or omissions of an agent who obtains or uses credit information or insurance scores for an insurer, provided the agent follows the instructions of or procedures established by the insurer and complies with any applicable law or regulation. Nothing in this section shall be construed to provide a consumer or other insured with a cause of action that does not exist in the absence of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 9, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-959. Sale of data or lists by consumer reporting agencies.&nbsp;</span></p> <p><span class="cls0">A. No consumer reporting agency shall provide or sell data or lists that include any information that in whole or in part was submitted in conjunction with an insurance inquiry about a consumer&rsquo;s credit information or a request for a credit report or insurance score. Such information includes, but is not limited to, the expiration dates of an insurance policy or any other information that may identify time periods during which a consumer&rsquo;s insurance may expire and the terms and conditions of the consumer&rsquo;s insurance coverage.&nbsp;</span></p> <p><span class="cls0">B. The restrictions provided in subsection A of this section do not apply to data or lists the consumer reporting agency supplies to the insurance agent from whom information was received, the insurer on whose behalf such agent acted, or such insurer&rsquo;s affiliates or holding companies.&nbsp;</span></p> <p><span class="cls0">C. Nothing in this section shall be construed to restrict any insurer from being able to obtain a claims history report or a motor vehicle report.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 127, &sect; 10, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-981. Short title and purposes of act.&nbsp;</span></p> <p><span class="cls0">Short Title and Purposes of Act.&nbsp;</span></p> <p><span class="cls0">A. Sections 981 through 998 of this title and Sections 22, 23 and 24 of this act shall constitute a part of the Oklahoma Insurance Code and shall be known and may be cited as the "Property and Casualty Competitive Loss Cost Rating Act".&nbsp;</span></p> <p><span class="cls0">B. The purposes of the Property and Casualty Competitive Loss Cost Rating Act are:&nbsp;</span></p> <p><span class="cls0">1. To promote price competition among insurers so as to provide rates that are responsive to competitive market conditions;&nbsp;</span></p> <p><span class="cls0">2. To protect policyholders and the public against the adverse effects of excessive, inadequate or unfairly discriminatory rates;&nbsp;</span></p> <p><span class="cls0">3. To prohibit unlawful price-fixing agreements and other anticompetitive behavior by insurers;&nbsp;</span></p> <p><span class="cls0">4. To provide regulatory procedures for the maintenance of appropriate data reporting systems;&nbsp;</span></p> <p><span class="cls0">5. To provide regulatory controls in the absence of a competitive marketplace; and&nbsp;</span></p> <p><span class="cls0">6. To authorize essential cooperative action among insurers in the ratemaking process and to regulate such activity to prevent practices that substantially lessen competition or create a monopoly.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 1, eff. Nov. 1, 1999. Amended by Laws 2004, c. 591, &sect; 12, eff. Nov. 1, 2004.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-982. Definitions.&nbsp;</span></p> <p><span class="cls0">Definitions.&nbsp;</span></p> <p><span class="cls0">As used in the Property and Casualty Competitive Loss Cost Rating Act:&nbsp;</span></p> <p><span class="cls0">1. "Accepted actuarial standards" means the standards adopted by the Casualty Actuarial Society Statement of Principles regarding property and casualty ratemaking or the Standards of Practice adopted by the Actuarial Standards Board;&nbsp;</span></p> <p><span class="cls0">2. "Advisory organization" means any corporation, unincorporated association, partnership or person, whether located inside or outside this state, that is licensed in accordance with Section 1140 of this title and which assists insurers in ratemaking-related activities such as enumerated in Section 1142 of this title;&nbsp;</span></p> <p><span class="cls0">3. "Classification system" or "classification" means the process of grouping risks with similar risk characteristics so that differences in costs may be recognized;&nbsp;</span></p> <p><span class="cls0">4. "Commercial risk" means any kind of risk that is not a personal risk;&nbsp;</span></p> <p><span class="cls0">5. "Commissioner" means the Commissioner of Insurance of this state;&nbsp;</span></p> <p><span class="cls0">6. "Competitive market" means a market which has not been found to be noncompetitive pursuant to Section 984 of this title;&nbsp;</span></p> <p><span class="cls0">7. "Developed losses" means losses, including loss adjustment expenses, adjusted using accepted actuarial standards, to eliminate the effect of differences between current payment or reserve estimates and those which are anticipated to provide actual ultimate loss, including loss adjustment expense payments;&nbsp;</span></p> <p><span class="cls0">8. "Expenses" means that portion of a rate attributable to acquisition, field supervision, collection expenses, general expenses, taxes, licenses and fees;&nbsp;</span></p> <p><span class="cls0">9. "Experience rating" means a rating procedure utilizing past insurance experience of the individual policyholder to forecast future losses by measuring the policyholder&rsquo;s loss experience against the loss experience of policyholders in the same classification to produce a prospective premium credit, debit or unity modification;&nbsp;</span></p> <p><span class="cls0">10. "Joint underwriting" means a voluntary arrangement established to provide insurance coverage for a risk pursuant to which two or more insurers jointly contract with the insured at a price and under policy terms agreed upon between the insurers;&nbsp;</span></p> <p><span class="cls0">11. "Loss adjustment expense" means the expenses incurred by the insurer in the course of settling claims;&nbsp;</span></p> <p><span class="cls0">12. "Market" means the statewide interaction between buyers and sellers of identical or readily substitutable products that provide insurance protection of identifiable perils to buyers;&nbsp;</span></p> <p><span class="cls0">13. "Mass marketed plan" means a method of selling property-liability insurance wherein the insurance is offered to employees of particular employers or to members of particular associations or organizations or to persons grouped in other ways, and the employer or association or other organization has agreed to, or otherwise affiliated itself with, the sale of such insurance to its employees or members;&nbsp;</span></p> <p><span class="cls0">14. "Noncompetitive market" means a market for which there is a ruling in effect pursuant to Section 984 of this title that a reasonable degree of competition does not exist;&nbsp;</span></p> <p><span class="cls0">15. "Personal risk" means homeowners, tenants, private passenger nonfleet automobiles, manufactured homes and other property and casualty insurance for personal, family or household needs, including any property and casualty insurance that is otherwise intended for noncommercial coverage;&nbsp;</span></p> <p><span class="cls0">16. "Pool" means a voluntary arrangement, established on an ongoing basis, pursuant to which two or more insurers participate in the sharing of risks on a predetermined basis. The pool may operate through an association, syndicate or other pooling agreement;&nbsp;</span></p> <p><span class="cls0">17. "Prospective loss costs" means historical aggregate losses and may include loss adjustment expenses, including all assessments that are loss based, projected through development to their ultimate value and through trending to a future point in time;&nbsp;</span></p> <p><span class="cls0">18. "Pure premium rate" means that portion of the rate which represents the loss costs per unit of exposure including loss adjustment expense;&nbsp;</span></p> <p><span class="cls0">19. "Rate" or "rates" means that cost of insurance per exposure unit whether expressed as a single number or as a prospective loss cost with an adjustment to account for the treatment of expenses, profit, and individual insurer variation in loss experience, prior to any application of individual risk variations based on loss or expense considerations, and does not include minimum premium;&nbsp;</span></p> <p><span class="cls0">20. "Residual market mechanism" means an arrangement, either voluntary or mandated by law, involving participation by insurers in the equitable apportionment among them of insurance which may be afforded applicants who are unable to obtain insurance through ordinary methods;&nbsp;</span></p> <p><span class="cls0">21. "Special assessments" means guaranty fund assessments, Special Indemnity Fund assessments, Vocational Rehabilitation Fund assessments, and other similar assessments. Special assessments shall not be considered as either expenses or losses;&nbsp;</span></p> <p><span class="cls0">22. "Statistical plan" means the plan, system or arrangement used in collecting data;&nbsp;</span></p> <p><span class="cls0">23. "Supplementary rating information" means any manual or plan of rates, classification, rating schedule, minimum premium, policy fee rating rule and any other information needed to determine the applicable premium in effect or to be in effect. This includes, rating plans, territory codes and descriptions and rules which include factors or relativities such as increased limits factors, deductible discounts or relativities, classification relativities or similar factors used to determine the rate in effect or to be in effect;&nbsp;</span></p> <p><span class="cls0">24. "Supporting information" means the experience and judgment of the filer and the experience or data of other insurers or advisory organizations relied upon by the filer, the interpretation of any other data relied upon by the filer, descriptions of methods used in making the rates and any other information required by the Commissioner to be filed; and&nbsp;</span></p> <p><span class="cls0">25. "Trending" means any procedure for projecting losses to the average date of loss, or premiums or exposures to the average date of writing, for the period during which the policies are to be effective.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 2, eff. Nov. 1, 1999. Amended by Laws 2004, c. 519, &sect; 13, eff. Nov. 1, 2004; Laws 2007, c. 125, &sect; 1, eff. July 1, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-983. Scope of act.&nbsp;</span></p> <p><span class="cls0">The Property and Casualty Competitive Loss Cost Rating Act applies to all forms of property and casualty insurance written in this state by insurers licensed in this state. The Property and Casualty Competitive Loss Cost Rating Act shall not apply to:&nbsp;</span></p> <p><span class="cls0">1. Reinsurance;&nbsp;</span></p> <p><span class="cls0">2. Life insurance;&nbsp;</span></p> <p><span class="cls0">3. Accident and health insurance;&nbsp;</span></p> <p><span class="cls0">4. Insurance of vessels or craft, their cargoes, marine builders' risks, marine protection and indemnity, or other risks commonly insured under marine, excluding inland marine, insurance as determined by the Commissioner; and&nbsp;</span></p> <p><span class="cls0">5. Title insurance.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 3, eff. Nov. 1, 1999. Amended by Laws 2004, c. 519, &sect; 14, eff. Nov. 1, 2004; Laws 2005, 1st Ex.Sess., c. 1, &sect; 3, eff. July 1, 2005.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-984. Competitive market.&nbsp;</span></p> <p><span class="cls0">Competitive Market.&nbsp;</span></p> <p><span class="cls0">A. A competitive market is presumed to exist for a line of insurance unless the Commissioner, after a hearing, issues an order stating that a reasonable degree of competition does not exist in the market. The burden of proof in any hearing shall be placed on the party or parties advocating the position that competition does not exist. Any ruling that a market is not competitive shall identify the factors causing the market not to be competitive. Such order shall expire no later than one (1) year after issue unless rescinded earlier by the Commissioner or unless the Commissioner renews the rule after a hearing and a finding as to the continued lack of a reasonable degree of competition. Any ruling that renews the finding that competition does not exist shall also identify the factors that cause the market to continue not to be competitive.&nbsp;</span></p> <p><span class="cls0">B. 1. In determining whether a reasonable degree of competition exists within a line of insurance, the Commissioner shall consider the following factors:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the number of insurers actively engaged in writing coverage,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;market shares of the leading writers and the changes in market shares over a reasonable period of time,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;existence of financial or economic barriers that could prevent new firms from entering the market,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;measures of market concentration and changes of market concentration over time,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;whether long-term profitability for insurers in the market is reasonable in relation to industries of comparable business risk, and&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;the relationship of insurers' costs to revenue over a reasonable period of time.&nbsp;</span></p> <p><span class="cls0">2. All determinations by the Commissioner shall be made on the basis of findings of fact and conclusions of law.&nbsp;</span></p> <p><span class="cls0">3. The ruling may be challenged in the district court.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner shall monitor the degree and continued existence of competition in this state on an ongoing basis. In doing so, the Commissioner may utilize existing relevant information, analytical systems and other sources, or rely on some combination thereof. Such activities may be conducted internally within the Insurance Department, in cooperation with other state insurance departments, through outside contractors or in any other appropriate manner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 4, eff. Nov. 1, 1999. Amended by Laws 2004, c. 519, &sect; 15, eff. Nov. 1, 2004.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-985. Ratemaking standards.&nbsp;</span></p> <p><span class="cls0">Ratemaking Standards.&nbsp;</span></p> <p><span class="cls0">A. A rate may not be excessive, inadequate or unfairly discriminatory.&nbsp;</span></p> <p><span class="cls0">1. No rate in a competitive market may be determined to be excessive. A rate in a noncompetitive market may be determined to be excessive if it is likely to produce a profit that is unreasonably high for the insurance provided.&nbsp;</span></p> <p><span class="cls0">2. A rate may not be determined to be inadequate unless:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the rate is clearly insufficient to sustain projected losses, expenses and special assessments, and&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the rate is unreasonably low and use of the rate by the insurer has tended or, if continued, will tend to create a monopoly in the market.&nbsp;</span></p> <p><span class="cls0">3. Unfair discrimination may be determined to exist if, after allowing for practical limitations, price differentials fail to reflect equitably the differences in expected losses and expenses. A rate may not be determined to be unfairly discriminatory because different premiums result for policyholders with like loss exposures but different expense levels, or like expenses but different loss exposures, or if it averaged broadly among persons insured within a group, franchise or blanket policy or a mass-marketed plan. No rate in a competitive market shall be considered unfairly discriminatory unless it classifies risk on the basis of race, color, creed, or national origin.&nbsp;</span></p> <p><span class="cls0">B. In determining whether rates in a noncompetitive market are excessive, inadequate, or unfairly discriminatory, due consideration may be given to:&nbsp;</span></p> <p><span class="cls0">1. Past and prospective loss experience within and outside this state, in accordance with accepted actuarial principles;&nbsp;</span></p> <p><span class="cls0">2. Conflagration and catastrophe hazards;&nbsp;</span></p> <p><span class="cls0">3. A reasonable margin for underwriting profit and contingencies;&nbsp;</span></p> <p><span class="cls0">4. Loadings for leveling premium rates over time for dividends, savings or unabsorbed premium deposits allowed or returned by insurers to their policyholders, members or subscribers;&nbsp;</span></p> <p><span class="cls0">5. Past and prospective expenses both countrywide and those specially applicable to this state; and&nbsp;</span></p> <p><span class="cls0">6. Provisions for special assessments; and to all other relevant factors including judgment within and outside this state.&nbsp;</span></p> <p><span class="cls0">C. Risks may be grouped by classifications for the establishment of rates and minimum premiums. Classification rates may be modified to produce rates for individual risks in accordance with rating plans which establish standards for measuring variations in hazards or expense provisions, or both. Such standards may measure any differences among risks that can be demonstrated to have a probable effect upon losses or expenses. No risk classification however, may be based on race, creed, national origin, or the religion of the insured.&nbsp;</span></p> <p><span class="cls0">D. The expense provisions included in the rates for use by an insurer or group of insurers may differ from those of any other insurer or group of insurers to reflect the requirements of the operating methods of the insurer or group of insurers.&nbsp;</span></p> <p><span class="cls0">E. The rates may contain provision for contingencies and an allowance permitting a reasonable profit. In determining the reasonableness of the profit, consideration shall be given to the investment income attributable to the line of insurance.&nbsp;</span></p> <p><span class="cls0">F. Risks may be classified in any way except that no risk may be classified on the basis of race, color, creed, or national origin.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 5, eff. Nov. 1, 1999. Amended by Laws 2004, c. 519, &sect; 16, eff. Nov. 1, 2004.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-985.1. Regulation of rates in market without competition.&nbsp;</span></p> <p><span class="cls0">A. If the Commissioner determines that competition does not exist in a market and issues a ruling to that effect pursuant to Section 984 of Title 36 of the Oklahoma Statutes, the rates applicable to insurance sold in that market shall be regulated in accordance with the provisions of Sections 985 through 989 of Title 36 of the Oklahoma Statutes that are applicable to noncompetitive markets.&nbsp;</span></p> <p><span class="cls0">B. Any rate in effect at the time the Commissioner determines that competition does not exist pursuant to Section 984 of Title 36 of the Oklahoma Statutes shall be deemed to be in compliance with the laws of this state unless disapproved pursuant to the procedures and rating standards contained in Sections 985 through 989 of Title 36 of the Oklahoma Statutes that are applicable to noncompetitive markets.&nbsp;</span></p> <p><span class="cls0">C. Any insurer having a rate filing in effect at the time the Commissioner determines that competition does not exist pursuant to Section 984 of Title 36 of the Oklahoma Statutes may be required to furnish supporting information within thirty (30) days of a written request by the Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2004, c. 519, &sect; 17, eff. Nov. 1, 2004.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-986. Rate administration.&nbsp;</span></p> <p><span class="cls0">Rate Administration.&nbsp;</span></p> <p><span class="cls0">A. In only those markets found to be noncompetitive pursuant to Section 984 of this title, insurers and advisory organizations shall file with the Commissioner and the Commissioner shall review reasonable rules and plans for recording and reporting their rates, loss and expense experience and other information determined by the Commissioner to be necessary or appropriate for the administration of the Property and Casualty Competitive Loss Cost Rating Act. The Commissioner may designate one or more advisory organizations or other agencies to assist in gathering such experience and making compilation thereof.&nbsp;</span></p> <p><span class="cls0">B. Reasonable rules and plans may be promulgated by the Commissioner for the exchange of data necessary for the development and application of rating plans.&nbsp;</span></p> <p><span class="cls0">C. In order to further uniform administration of rate regulatory laws, the Commissioner and every insurer and advisory organization may exchange information and experience data with insurance supervisory officials, insurers and advisory organizations in other states and may consult with them with respect to the application of rating systems.&nbsp;</span></p> <p><span class="cls0">D. Cooperation among advisory organizations or among advisory organizations and insurers in ratemaking or in other matters within the scope of the Property and Casualty Competitive Loss Cost Rating Act is authorized. The Commissioner may review such cooperative activities and practices, and if, after a hearing, any such activity or practice is found to violate the provisions of the Property and Casualty Competitive Loss Cost Rating Act, a written order may be issued specifying that such activity or practice violates the provisions of this act and requiring the discontinuance of such activity.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 6, eff. Nov. 1, 1999. Amended by Laws 2004, c. 519, &sect; 18, eff. Nov. 1, 2004.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-987. Rate filings.&nbsp;</span></p> <p><span class="cls0">Rate Filings.&nbsp;</span></p> <p><span class="cls0">A. In a competitive market, every insurer shall file with the Commissioner all rates and supplementary rate information to be used in this state no later than thirty (30) days after the effective date; provided, that the rates and supplementary rate information need not be filed for commercial risks, which by general custom are not written according to manual rules or rating plans.&nbsp;</span></p> <p><span class="cls0">B. In a noncompetitive market, every insurer shall file with the Commissioner all rates, supplementary rate information and supporting information at least thirty (30) days before the proposed effective date. The Commissioner may give written notice, within thirty (30) days of receipt of the filing, that the Commissioner needs additional time, not to exceed thirty (30) days from the date of the notice to consider the filing. Upon written application of the insurer, the Commissioner may authorize rates to be effective before the expiration of the waiting period or an extension thereof. A filing shall be deemed to meet the requirements of the Property and Casualty Competitive Loss Cost Rating Act and to become effective unless disapproved pursuant to this title by the Commissioner before the expiration of the waiting period or an extension thereof.&nbsp;</span></p> <p><span class="cls0">In a noncompetitive market, the filing shall be deemed in compliance with the filing provision of this section unless the Commissioner informs the insurer within ten (10) days after receipt of the filings as to what supplementary rate information or supporting information is required to complete the filing.&nbsp;</span></p> <p><span class="cls0">C. Every authorized insurer shall file with the Commissioner, except as to rates for those lines of insurance exempted from the provisions of the Property and Casualty Competitive Loss Cost Rating Act by the Commissioner under subsections E and F of this section and except for those risks designated as special risks under Section 997 of this title, all rates, supplementary rate information and any changes and amendments which it proposes to use. An insurer may file its rates by either filing its final rates or by filing a multiplier and, if applicable, an expense constant adjustment to be applied to prospective loss costs that have been filed by an advisory organization as permitted by this title. Such loss cost multiplier filing and expense constant filings made by insurers shall remain in effect until amended or withdrawn by the insurer. Every filing shall state the effective date.&nbsp;</span></p> <p><span class="cls0">D. Under rules as may be adopted, the Commissioner may, by written order, suspend or modify the requirement of filing as to any kind of insurance, subdivision or combination thereof, or as to classes of risks.&nbsp;</span></p> <p><span class="cls0">E. Notwithstanding any other provision of the Property and Casualty Competitive Loss Cost Rating Act, upon the written consent of the insured in a separate written document, a rate in excess of that determined in accordance with the other provisions of the Property and Casualty Competitive Loss Cost Rating Act may be used on a specific risk.&nbsp;</span></p> <p><span class="cls0">F. A filing and any supporting information required to be filed shall be open to public inspection once the filing becomes effective except information marked confidential, trade secret, or proprietary by the insurer or filer and except the filings of an advisory organization which shall be open to public inspection upon the received date of the rate, loss cost, or manual rule change. The insurer or filer shall have the burden of asserting to the Commissioner that a filing and supporting information are confidential, upon the request of the Commissioner. The Commissioner may disapprove of the insurer&rsquo;s request for confidential filing status.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 7, eff. Nov. 1, 1999. Amended by Laws 2004, c. 519, &sect; 19, eff. Nov. 1, 2004; Laws 2005, c. 129, &sect; 7, eff. Nov. 1, 2005; Laws 2007, c. 125, &sect; 2, eff. July 1, 2007; Laws 2008, c. 184, &sect; 7, eff. July 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-988. Repealed by Laws 2004, c. 519, &sect; 37, eff. Nov. 1, 2004.&nbsp;</span></p> <p><span class="cls0">&sect;36-989. Improper rates &ndash; Disapproval - Hearing.&nbsp;</span></p> <p><span class="cls0">Improper Rates; Disapproval; Hearing.&nbsp;</span></p> <p><span class="cls0">A. Basis for disapproval.&nbsp;</span></p> <p><span class="cls0">1. The Commissioner shall disapprove a rate in a competitive market only if the Commissioner finds, pursuant to subsection B of this section, that the rate is inadequate or unfairly discriminatory pursuant to Section 985 of this title.&nbsp;</span></p> <p><span class="cls0">2. The Commissioner may disapprove a rate for use in a noncompetitive market only if the Commissioner finds, pursuant to subsection B of this section, that the rate is excessive, inadequate or unfairly discriminatory under this subsection.&nbsp;</span></p> <p><span class="cls0">B. Procedures for disapproval.&nbsp;</span></p> <p><span class="cls0">1. Prior to the expiration of a waiting period or an extension thereof, made pursuant to subsection B of Section 987 of this title, the Commissioner may disapprove, by written order, rates filed pursuant to subsection B of Section 987 of this title with a hearing. The order shall specify in what respects the filing fails to meet the requirements of this act. Any insurer whose rates are disapproved pursuant to this section shall be given a hearing upon written request made within thirty (30) days of disapproval.&nbsp;</span></p> <p><span class="cls0">2. If, at any time, the Commissioner finds that a rate applicable to insurance sold in a noncompetitive market does not comply with the standards set forth in Section 985 of this title, the Commissioner may, after a hearing held upon not less than twenty (20) days&rsquo; written notice, issue an order pursuant to subsection C of this section, disapproving such rate. The hearing notice shall be sent to every insurer and advisory organization that adopted the rate and shall specify the matters to be considered at the hearing. The disapproval order shall not affect any contract or policy made or issued prior to the effective date set forth in the order.&nbsp;</span></p> <p><span class="cls0">3. If, at any time, the Commissioner finds that a rate applicable to insurance sold in a competitive market is inadequate or unfairly discriminatory under paragraph 2 or 3 of subsection A of Section 985 of this title, the Commissioner may issue an order pursuant to subsection C of this section disapproving the rate. The order shall not affect any contract or policy made or issued prior to the effective date set forth in the order.&nbsp;</span></p> <p><span class="cls0">C. Order of disapproval.&nbsp;</span></p> <p><span class="cls0">If the Commissioner disapproves a rate pursuant to subsection B of this section, the Commissioner shall issue an order within thirty (30) days of the close of the hearing specifying in what respects the rate fails to meet the requirements of this act. The order shall state an effective date no sooner than thirty (30) business days after the date of the order when the use of the rate shall be discontinued. This order shall not affect any policy made before the effective date of the order.&nbsp;</span></p> <p><span class="cls0">D. Appeal of orders and establishment of reserves.&nbsp;</span></p> <p><span class="cls0">If an order of disapproval is appealed pursuant to Section 990 of this title, the insurer may implement the disapproved rate upon notification to the court, in which case any excess of the disapproved rate over a rate previously in effect shall be placed in a reserve established by the insurer. The court shall have control over the disbursement of funds from such reserve. The funds shall be distributed as determined by the court in its final order except that de minimus refunds to policyholders shall not be required.&nbsp;</span></p> <p><span class="cls0">E. All determinations made by the Commissioner under this section shall be on the basis of findings of fact and conclusions of law.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 9, eff. Nov. 1, 1999. Amended by Laws 2004, c. 519, &sect; 20, eff. Nov. 1, 2004.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-990. Challenge and review of application of rating system.&nbsp;</span></p> <p><span class="cls0">Challenge and Review of Application of Rating System.&nbsp;</span></p> <p><span class="cls0">A. Every advisory organization and every insurer subject to the Property and Casualty Competitive Loss Cost Rating Act which makes its own rates shall provide within this state reasonable means whereby any insured aggrieved by the application of its rating system may, upon that insured's written request, be heard in person or by the insured's authorized representative to review the manner in which such rating system has been applied in connection with the insurance afforded the aggrieved insurer.&nbsp;</span></p> <p><span class="cls0">B. An insurer or any party affected by the action of an advisory organization may, within thirty (30) days after written notice of that action, make application, in writing, for an appeal to the Commissioner, setting forth the basis for the appeal and the grounds to be relied upon by the applicant.&nbsp;</span></p> <p><span class="cls0">C. Within thirty (30) days, the Commissioner shall review the application and, if the Commissioner finds that the application is made in good faith and that it sets forth on its face grounds which reasonably justify holding a hearing, the Commissioner shall conduct a hearing held not less than ten (10) days after written notice to the applicant and to the advisory organization or insurer. The Commissioner, after a hearing, shall affirm or reverse the action of the advisory organization or insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 10, eff. Nov. 1, 1999. Amended by Laws 2004, c. 519, &sect; 21, eff. Nov. 1, 2004.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-991. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-992. Insurers - Prohibited activity.&nbsp;</span></p> <p><span class="cls0">Insurers; Prohibited Activity.&nbsp;</span></p> <p><span class="cls0">A. No insurer shall:&nbsp;</span></p> <p><span class="cls0">1. Attempt to monopolize, or combine or conspire with any person or persons to monopolize an insurance market;&nbsp;</span></p> <p><span class="cls0">2. Engage in a boycott, on a concerted basis, of an insurance market; and&nbsp;</span></p> <p><span class="cls0">3. Except as set forth in subsection B of this section, agree to mandate adherence to or to mandate use of any rate, prospective loss cost, rating plan, rating schedule, rating rule, policy or bond form, rate classification, rate territory, underwriting rule, survey, inspection or similar material. Insurers and advisory organizations may agree to develop and adhere to statistical plans permitted by this title.&nbsp;</span></p> <p><span class="cls0">B. The fact that two or more insurers, whether or not members or subscribers of an advisory organization, use consistently or intermittently the same rates, prospective loss costs, rating plans, rating schedules, rating rules, policy or bond forms, rate classifications, rate territories, underwriting rules, surveys or inspections or similar materials is not sufficient in itself to support a finding that an agreement exists.&nbsp;</span></p> <p><span class="cls0">C. Two or more insurers having a common ownership or operating in this state under common management or control may act in concert between or among themselves with respect to any matters pertaining to those activities authorized in the Property and Casualty Competitive Loss Cost Rating Act as if they constituted a single insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 12, eff. Nov. 1, 1999. Amended by Laws 2005, c. 129, &sect; 9, eff. Nov. 1, 2005; Laws 2007, c. 125, &sect; 3, eff. July 1, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-993. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-994. Advisory organizations - Filing requirements.&nbsp;</span></p> <p><span class="cls0">Advisory Organizations; Filing Requirements.&nbsp;</span></p> <p><span class="cls0">Every advisory organization shall file with the Commissioner for approval every statistical plan, all prospective loss costs, provisions for special assessments and all supplementary rating information and every change or amendment or modification of any of the foregoing proposed for use in this state at least thirty (30) days prior to its effective date. Such filings will be deemed approved unless disapproved within the waiting period.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 14, eff. Nov. 1, 1999.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-995. Joint underwriting, joint reinsurance pool and residual market activities.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">Joint Underwriting, Joint Reinsurance Pool and Residual Market Activities.&nbsp;</span></p> <p><span class="cls0">A. This section shall not apply to transactions involving CompSource Oklahoma.&nbsp;</span></p> <p><span class="cls0">B. Notwithstanding paragraph 3 of subsection A of Section 992 of this title, insurers participating in joint underwriting, joint reinsurance pools or residual market mechanisms may in connection with such activity act in cooperation with each other in the making of rates, rating systems, policy forms, underwriting rules, surveys, inspections and investigations, the furnishing of loss and expense statistics or other information, or carrying on research. Joint underwriting, joint reinsurance pools and residual market mechanisms shall not be deemed an advisory organization.&nbsp;</span></p> <p><span class="cls0">C. Except to the extent modified by this section, joint underwriting, joint reinsurance pool and residual market mechanism activities are subject to the other provisions of the Property and Casualty Competitive Loss Cost Rating Act.&nbsp;</span></p> <p><span class="cls0">D. If, after a hearing, the Commissioner finds that any activity or practice of an insurer participating in joint underwriting or a pool is unfair, is unreasonable, will tend to lessen competition in any market or is otherwise inconsistent with the provisions or purposes of the Property and Casualty Competitive Loss Cost Rating Act, the Commissioner may issue a written order and require the discontinuance of such activity or practice.&nbsp;</span></p> <p><span class="cls0">E. Every pool shall file with the Commissioner a copy of its constitution, articles of incorporation, agreement or association, bylaws, rules and regulations governing its activities, list of members, the name and address of a resident of this state upon whom notice, orders of the Commissioner, or process may be served, and any changes in amendments or changes in the foregoing.&nbsp;</span></p> <p><span class="cls0">F. Any residual market mechanism, plan or agreement to implement such a mechanism, and any changes or amendments thereto, shall be submitted in writing to the Commissioner for consideration and approval, together with such information as may be reasonably required.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 15, eff. Nov. 1, 1999. Amended by Laws 2007, c. 125, &sect; 4, eff. July 1, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">Joint Underwriting, Joint Reinsurance Pool and Residual Market Activities.&nbsp;</span></p> <p><span class="cls0">A. This section shall not apply to transactions involving CompSource Mutual Insurance Company.&nbsp;</span></p> <p><span class="cls0">B. Notwithstanding paragraph 3 of subsection A of Section 992 of this title, insurers participating in joint underwriting, joint reinsurance pools or residual market mechanisms may in connection with such activity act in cooperation with each other in the making of rates, rating systems, policy forms, underwriting rules, surveys, inspections and investigations, the furnishing of loss and expense statistics or other information, or carrying on research. Joint underwriting, joint reinsurance pools and residual market mechanisms shall not be deemed an advisory organization.&nbsp;</span></p> <p><span class="cls0">C. Except to the extent modified by this section, joint underwriting, joint reinsurance pool and residual market mechanism activities are subject to the other provisions of the Property and Casualty Competitive Loss Cost Rating Act.&nbsp;</span></p> <p><span class="cls0">D. If, after a hearing, the Commissioner finds that any activity or practice of an insurer participating in joint underwriting or a pool is unfair, is unreasonable, will tend to lessen competition in any market or is otherwise inconsistent with the provisions or purposes of the Property and Casualty Competitive Loss Cost Rating Act, the Commissioner may issue a written order and require the discontinuance of such activity or practice.&nbsp;</span></p> <p><span class="cls0">E. Every pool shall file with the Commissioner a copy of its constitution, articles of incorporation, agreement or association, bylaws, rules and regulations governing its activities, list of members, the name and address of a resident of this state upon whom notice, orders of the Commissioner, or process may be served, and any changes in amendments or changes in the foregoing.&nbsp;</span></p> <p><span class="cls0">F. Any residual market mechanism, plan or agreement to implement such a mechanism, and any changes or amendments thereto, shall be submitted in writing to the Commissioner for consideration and approval, together with such information as may be reasonably required.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 15, eff. Nov. 1, 1999. Amended by Laws 2007, c. 125, &sect; 4, eff. July 1, 2007; Laws 2013, c. 254, &sect; 18, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-996. Assigned risks.&nbsp;</span></p> <p><span class="cls0">Assigned Risks.&nbsp;</span></p> <p><span class="cls0">Agreements may be made among insurers with respect to the equitable apportionment among them of insurance which may be afforded applicants who are in good faith entitled to, but who are unable to procure such insurance through ordinary methods, and such insurers may agree among themselves on the use of reasonable rate modifications for such insurance, such agreements and rate modifications to be subject to the approval of the Commissioner. Nothing in the Property and Casualty Competitive Loss Cost Rating Act shall permit disapproval of a residual market plan permitting an insurer to elect voluntary direct assignment.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 16, eff. Nov. 1, 1999. Amended by Laws 2007, c. 125, &sect; 5, eff. July 1, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-996.1. Assigned risk plans.&nbsp;</span></p> <p><span class="cls0">After consultation with the insurance companies authorized to issue automobile liability policies in this state, the Insurance Commissioner shall approve a reasonable plan or plans, fair to the insurers and equitable to their policyholders, for the apportionment among such companies of applicants for such policies and for motor vehicle liability policies who are in good faith entitled to but are unable to procure such policies through ordinary methods. When any such plan has been approved, all such insurance companies shall subscribe thereto and participate therein. Any applicant for any such policy, any person insured under any such plan, and any insurance company affected may appeal to the Insurance Commissioner from any ruling or decision of the manager or committee designated to operate such plan. Any order or act of the Insurance Commissioner under the provisions of this section shall be subject to review by appeal to the district court of Oklahoma County at the instance of any party in interest. The court shall determine whether the filing of the appeal shall operate as a stay of any such order or act of the Insurance Commissioner and the court shall summarily hear the matter. The court may, in disposing of the issue before it, modify, affirm or reverse the order or act of the Insurance Commissioner in whole or in part.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1961, p. 365, &sect; 7-501. Renumbered from Title 47, &sect; 7-501 by Laws 2009, c. 62, &sect; 40, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-997. Commercial special risks.&nbsp;</span></p> <p><span class="cls0">Commercial Special Risks.&nbsp;</span></p> <p><span class="cls0">A. The following categories of commercial lines risks, excluding employer's liability line, workers&rsquo; compensation and excess workers&rsquo; compensation, are special risks and are exempted from the filing and review requirements set forth in Section 987 of this title:&nbsp;</span></p> <p><span class="cls0">1. Risks which are written on an excess or umbrella basis;&nbsp;</span></p> <p><span class="cls0">2. Commercial lines insurance risks which produce a minimum annual premium total of Ten Thousand Dollars ($10,000.00); and&nbsp;</span></p> <p><span class="cls0">3. Specifically designated special risks, including:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;risks insured under the provisions of the Highly Protected Risks Rating Plan,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;all commercial insurance aviation risks,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;all credit insurance risks,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;all boiler, machinery or equipment breakdown risks,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;all inland marine risks,&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;all fidelity and surety risks, and&nbsp;</span></p> <p class="cls2"><span class="cls0">g.&nbsp;&nbsp;any other risk that the Commissioner determines to fall within the special risk category.&nbsp;</span></p> <p><span class="cls0">B. Underwriting files, premiums, loss and expense statistics, financial and other records with regard to special risks written by an insurer shall be maintained by the insurer and shall be subject to examination by the Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 17, eff. Nov. 1, 1999. Amended by Laws 2006, c. 264, &sect; 26, eff. July 1, 2006; Laws 2010, c. 222, &sect; 9, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-998. Appeals from Commissioner.&nbsp;</span></p> <p><span class="cls0">Appeals from Commissioner.&nbsp;</span></p> <p><span class="cls0">A. Any party aggrieved by an order or decision of the Commissioner may, within thirty (30) days after receiving the Commissioner's notice, make written request for a hearing.&nbsp;</span></p> <p><span class="cls0">B. Any order, decision or act of the Commissioner pursuant to the Property and Casualty Competitive Loss Cost Rating Act is subject to judicial review upon petition of any person aggrieved. The appeal shall be in accordance with the Administrative Procedures Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1999, c. 83, &sect; 18, eff. Nov. 1, 1999. Amended by Laws 2007, c. 125, &sect; 6, eff. July 1, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-999. Examination to ascertain compliance &ndash; Records &ndash; Cost &ndash; Report of examination in another state.&nbsp;</span></p> <p><span class="cls0">A. The Commissioner may examine any insurer, pool, advisory organization, or residual market mechanism to ascertain compliance with the Property and Casualty Competitive Loss Cost Rating Act.&nbsp;</span></p> <p><span class="cls0">B. Every insurer, pool, advisory organization, and residual market mechanism shall maintain adequate records from which the Commissioner may determine compliance with the provisions of the Property and Casualty Competitive Loss Cost Rating Act. The records shall contain the experience, data, statistics and other information collected or used and shall be available to the Commissioner for examination or inspection upon reasonable notice.&nbsp;</span></p> <p><span class="cls0">C. The reasonable cost of an examination made pursuant to this section shall be paid by the examined party upon presentation to the party of a detailed account of the costs.&nbsp;</span></p> <p><span class="cls0">D. The Commissioner may accept the report of an examination made by an insurance supervisor official of another state in lieu of an examination pursuant to this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2004, c. 519, &sect; 22, eff. Nov. 1, 2004.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-999.1. Short title.&nbsp;</span></p> <p><span class="cls0">Sections 1 through 7 of this act shall constitute Article 9C of the Insurance Code and shall be known and may be cited as the &ldquo;Oklahoma Subsidence Insurance Act&rdquo;.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2005, c. 118, &sect; 1, eff. Jan. 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-999.2. Purpose of act.&nbsp;</span></p> <p><span class="cls0">The purpose of the Oklahoma Subsidence Insurance Act is to make mine subsidence insurance coverage available for residences, living units and commercial buildings located in this state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2005, c. 118, &sect; 2, eff. Jan. 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-999.3. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in the Oklahoma Subsidence Insurance Act:&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Commercial building&rdquo; means any building, other than a residence or living unit, permanently affixed to realty located in this state, including basements, footings, foundations, septic systems and underground pipes directly servicing the building, but does not include sidewalks, driveways, parking lots, swimming pools, patios, pilings, piers, wharves, docks, retaining walls, fences, land, trees, plants, crops or agricultural field drainage tile;&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Commercial coverage&rdquo; means mine subsidence insurance for a commercial building;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Insurer&rdquo; or &ldquo;insurers&rdquo; means insurance companies and reciprocals licensed and authorized to write homeowner&rsquo;s insurance and commercial property insurance policies in this state;&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Living unit&rdquo; means the physical portion designated for separate ownership or occupancy for residential purposes, of a building or group of buildings, permanently affixed to realty located in this state, having elements which are owned or used in common, including an apartment unit, a condominium unit, a cooperative unit or any other similar unit, including appurtenant structures, basements, footings, foundations, septic systems and underground pipes directly servicing the dwelling or building, but does not include swimming pools, patios, pilings, wharves, docks, retaining walls, fences, sidewalks, driveways, land, trees, plants, crops or agricultural field drainage tile;&nbsp;</span></p> <p><span class="cls0">5. &ldquo;Living unit coverage&rdquo; means mine subsidence insurance for a living unit;&nbsp;</span></p> <p><span class="cls0">6. &ldquo;Mine subsidence&rdquo; means lateral or vertical ground movement caused by a failure initiated at the mine level, of man-made underground mines, including, but not limited to, coal mines, clay mines, lead and zinc mines, limestone mines, and fluorspar mines that directly damage residences or commercial buildings. &ldquo;Mine subsidence&rdquo; does not include lateral or vertical ground movement caused by earthquake, landslide, volcanic eruption, soil conditions, soil erosion, soil freezing and thawing, improperly compacted soil, construction defects, roots of trees and shrubs or collapse of storm and sewer drains and rapid transit tunnels;&nbsp;</span></p> <p><span class="cls0">7. &ldquo;Policy&rdquo; or &ldquo;policies&rdquo; means any contract or contracts of insurance providing the coverage of the Standard Fire Policy and Extended Coverage Endorsement on any residence, living unit or commercial building. It does not include those insurance contracts that are referred to as marine or inland marine policies;&nbsp;</span></p> <p><span class="cls0">8. &ldquo;Residence&rdquo; means a building used principally for residential purposes up to and including a four-family dwelling, permanently affixed to realty located in Oklahoma, including appurtenant structures, basements, footings, foundations, septic systems and underground pipes directly servicing the dwelling or building, but does not include living units, swimming pools, patios, pilings, wharves, docks, retaining walls, fences, sidewalks, driveways, land, trees, plants, crops or agricultural field drainage tile; and&nbsp;</span></p> <p><span class="cls0">9. &ldquo;Residential coverage&rdquo; means mine subsidence insurance for a residence.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2005, c. 118, &sect; 3, eff. Jan. 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-999.4. Subsidence coverage for residences, living units and commercial buildings - Exemption.&nbsp;</span></p> <p><span class="cls0">A. Beginning January 1, 2006, every insurer, as defined by Section 3 of this act, may offer mine subsidence coverage, upon the request by the policyholder, on policies, as defined by Section 3 of this act, issued or renewed, insuring residences, living units and commercial buildings.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner may exempt policies insuring residences, living units or commercial buildings located in any specified county of this state from the provisions of this section if the Commissioner determines that such coverage is not necessary for a specified county.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2005, c. 118, &sect; 4, eff. Jan. 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-999.5. Coverage for additional living expenses.&nbsp;</span></p> <p><span class="cls0">The residential coverage provided pursuant to the Oklahoma Subsidence Insurance Act may also cover the additional living expenses reasonably and necessarily incurred by the owner of a residence who has been temporarily displaced as the direct result of damage to the residence caused by mine subsidence if the underlying policy also covers this type of loss; provided, however, that the loss covered under living unit coverage shall be limited to losses to improvements and betterments and reimbursement of additional living expenses and assessments made against the insured on account of mine subsidence loss.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2005, c. 118, &sect; 5, eff. Jan. 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-999.6. Refusal to cover unrepaired damage.&nbsp;</span></p> <p><span class="cls0">An insurer may refuse to provide mine subsidence coverage on a residence, living unit or commercial building evidencing unrepaired mine subsidence damage until such damage has been repaired.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2005, c. 118, &sect; 6, eff. Jan. 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-999.7. Right of subrogation.&nbsp;</span></p> <p><span class="cls0">All insurers issuing mine subsidence policies shall retain the right of subrogation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2005, c. 118, &sect; 7, eff. Jan. 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1000. Repealed by Laws 2006, c. 264, &sect; 82, eff. July 1, 2006.&nbsp;</span></p> <p><span class="cls0">&sect;36-1001. Judicial review.&nbsp;</span></p> <p><span class="cls0">Any order, ruling, finding, decision or other act of the Oklahoma Insurance Department made pursuant to the Property and Casualty Competitive Loss Cost Rating Act shall be subject to judicial review.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2004, c. 519, &sect; 24, eff. Nov. 1, 2004. Amended by Laws 2007, c. 125, &sect; 7, eff. July 1, 2007.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1100. Short title - Purpose and effect.&nbsp;</span></p> <p><span class="cls0">A. Sections 1100 through 1120 of Title 36 of the Oklahoma Statutes shall be known and may be cited as the "Unauthorized Insurers and Surplus Lines Insurance Act".&nbsp;</span></p> <p><span class="cls0">B. The purpose and effect of the Unauthorized Insurers and Surplus Lines Insurance Act shall relate back to the effective date of implementation of the Nonadmitted and Reinsurance Reform Act of 2010.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2011, c. 278, &sect; 4 and Laws 2011, c. 360, &sect; 4. Amended by Laws 2012, c. 45, &sect; 1, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 4 and Laws 2011, c. 360, &sect; 4 created identical new sections in Title 36.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1100.1. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in the Unauthorized Insurers and Surplus Lines Insurance Act:&nbsp;</span></p> <p><span class="cls0">1. "Admitted insurer" means, with respect to a state, an insurer that is licensed to transact the business of insurance in such state;&nbsp;</span></p> <p><span class="cls0">2. "Home state" means:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;except as provided in subparagraphs b through e of this paragraph, with respect to an insured:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;the state in which an insured maintains its principal place of business or, in the case of an individual, the individual's principal residence, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;if one hundred percent (100%) of the insured risk is located out of the state referred to in division (1) of this subparagraph, the state to which the greatest percentage of the insured's taxable premium for the insurance contract is allocated,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;with respect to determining the home state of the insured, "principal place of business" means:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;the state where the insured maintains its headquarters and where the insured's high-level officers direct, control and coordinate the business activities, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;if the insured maintains its headquarters or the insured's high-level officers direct, control and coordinate the business activities outside Oklahoma, the state to which the greatest percentage of the insured's taxable premium for that insurance contract is allocated,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;with respect to determining the home state of the insured, "principal residence" means:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;the state where the insured resides for the greatest number of days during the calendar year, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;if the insured's principal residence is located outside any state, the state to which the greatest percentage of the insured's taxable premium for that insurance is allocated,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;if more than one insured from an affiliated group are named insureds on a single nonadmitted insurance contract, the term "home state" means the home state, as determined pursuant to division (1) of subparagraph a of this paragraph, of the member affiliated group that has the largest percentage of premium attributed to it under such insurance contract, or&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;when the group policyholder pays one hundred percent (100%) of the premium from its own funds, the term "home state" means the home state, as determined pursuant to division (1) of subparagraph a of this paragraph, of the group policyholder. When the group policyholder does not pay one hundred percent (100%) of the premium from its own funds, the term "home state" means the home state, as determined pursuant to division (1) of subparagraph a of this paragraph, or of the group member;&nbsp;</span></p> <p><span class="cls0">3. "Independently procured insurance" means insurance procured by an insured directly from a nonadmitted insurer;&nbsp;</span></p> <p><span class="cls0">4. "Licensed" means, with respect to an insurer, authorization to transact the business of insurance in a state by a license, certificate of authority, charter or otherwise;&nbsp;</span></p> <p><span class="cls0">5. "Multistate risk" means a risk covered by a nonadmitted insurer with insured exposures in more than one state;&nbsp;</span></p> <p><span class="cls0">6. "Nonadmitted insurance" means any property and casualty insurance permitted in a state to be placed directly through a surplus lines licensee or broker with a nonadmitted insurer eligible to accept such insurance. For purposes of the Unauthorized Insurers and Surplus Lines Insurance Act, nonadmitted insurance includes independently procured insurance and surplus lines insurance;&nbsp;</span></p> <p><span class="cls0">7. "Nonadmitted insurer" means, with respect to a state, an insurer not licensed to engage in the business of insurance in such state, but shall not include a risk retention group as that term is defined under applicable federal law;&nbsp;</span></p> <p><span class="cls0">8. "Single-state risk" means a risk insured with insured exposures in only one state;&nbsp;</span></p> <p><span class="cls0">9. "Surplus lines insurance" means insurance procured by a nonadmitted licensee or broker from a surplus lines insurer as permitted under the law of the insured's home state; and&nbsp;</span></p> <p><span class="cls0">10. "Surplus lines licensee" or "surplus lines broker" means an individual, firm or corporation that is licensed in the insured's home state to sell, solicit, or negotiate insurance, including the agent of record on a nonadmitted insurance policy, on properties, risks or exposures located or to be performed in a state allowing nonadmitted insurers to do business.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2011, c. 278, &sect; 5. Amended by Laws 2011, c. 360, &sect; 5; Laws 2012, c. 45, &sect; 2, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1100.2. Authority to enter multistate agreements.&nbsp;</span></p> <p><span class="cls0">A. For the purposes of carrying out the Nonadmitted and Reinsurance Reform Act of 2010, the Insurance Commissioner is authorized in the Insurance Commissioner's sole discretion and judgment to enter into the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose, in order to:&nbsp;</span></p> <p><span class="cls0">1. Facilitate the collection, allocation and disbursement of premium taxes attributable to the placement of nonadmitted insurance through a central clearinghouse;&nbsp;</span></p> <p><span class="cls0">2. Provide for uniform methods of allocation and reporting among nonadmitted insurance risk classifications through a central clearinghouse; and&nbsp;</span></p> <p><span class="cls0">3. Share information among states relating to nonadmitted insurance premium taxes.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner is not compelled now or in the future to join the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose of distributing surplus line premium tax proceeds based on a formula of multistate risk allocation, unless the Insurance Commissioner, in his or her discretion, deems joining such a multistate compact or agreement is in the best interest of the State of Oklahoma and its citizens.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2011, c. 278, &sect; 6. Amended by Laws 2011, c. 360, &sect; 6; Laws 2012, c. 45, &sect; 3, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1101. Representation of unauthorized insurers prohibited.&nbsp;</span></p> <p><span class="cls0">A. No person in Oklahoma shall in any manner:&nbsp;</span></p> <p><span class="cls0">1. Represent or assist any nonadmitted insurer in the soliciting, procuring, placing, or maintenance of any nonadmitted insurance coverage upon or with relation to any subject of insurance resident, located, or to be performed in Oklahoma without being a surplus lines licensee or broker as defined in the Unauthorized Insurers and Surplus Lines Insurance Act; or&nbsp;</span></p> <p><span class="cls0">2. Inspect or examine any risk or collect or receive any premium on behalf of any nonadmitted insurer without being a surplus lines broker or licensee as defined in the Unauthorized Insurers and Surplus Lines Insurance Act.&nbsp;</span></p> <p><span class="cls0">B. Any person transacting insurance or acting as a surplus lines broker or licensee in violation of this section shall be liable to the insured for the performance of any contract between the insured and the insurer resulting from the transaction.&nbsp;</span></p> <p><span class="cls0">C. This section shall not apply as to reinsurance, to surplus line insurance lawfully procured pursuant to the Unauthorized Insurers and Surplus Lines Insurance Act, to transactions exempt under Section 606 of this title (Authorization of Insurers and General Qualifications), or to professional services of an adjuster or attorney-at-law from time to time with respect to claims under policies lawfully solicited, issued, and delivered outside of Oklahoma.&nbsp;</span></p> <p><span class="cls0">D. The investigation and adjustment of any claim in this state arising under an insurance contract issued by a nonadmitted insurer shall not be deemed to constitute the transacting of the business of insurance in this state.&nbsp;</span></p> <p><span class="cls0">E. Nonadmitted insurers shall contract with the trustees of any fund which will insure residents in this state in a manner consistent with the requirements, nature and scope of the Unauthorized Insurers and Surplus Lines Insurance Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 256, &sect; 1101, operative July 1, 1957. Amended by Laws 1976, c. 98, &sect; 1, emerg. eff. May 10, 1976; Laws 2010, c. 222, &sect; 10, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 7 and Laws 2011, c. 360, &sect; 7; Laws 2012, c. 45, &sect; 4, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 7 and Laws 2011, c. 360, &sect; 7 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1101.1. Domestic surplus line insurers.&nbsp;</span></p> <p><span class="cls0">A. An Oklahoma domestic insurer possessing policyholder surplus of at least Fifteen Million Dollars ($15,000,000.00) may, pursuant to a resolution by its board of directors, and with the written approval of the Insurance Commissioner, be designated as a domestic surplus line insurer. Such insurers may write surplus line insurance in this state and in any other jurisdiction allowed under the Nonadmitted and Reinsurance Reform Act of 2010.&nbsp;</span></p> <p><span class="cls0">B. The premiums of a domestic surplus line insurer shall be subject to surplus line premium tax pursuant to Section 1115 of this title. The surplus lines broker or licensee shall pay all premium taxes to the Insurance Commissioner when Oklahoma is the home state of the insured until and unless in the exercise of his or her sole discretion and judgment, the Insurance Commissioner decides to join the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose.&nbsp;</span></p> <p><span class="cls0">C. A domestic surplus line insurer may not issue a policy designed to satisfy the motor vehicle financial responsibility requirement of this state, the Workers' Compensation Code, or any other law mandating insurance coverage by a licensed insurance company.&nbsp;</span></p> <p><span class="cls0">D. A domestic surplus line insurer is not subject to the provisions of the Oklahoma Property & Casualty Insurance Guaranty Association Act nor the Oklahoma Life and Health Insurance Guaranty Association Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 176, &sect; 22, eff. Nov. 1, 2009. Amended by Laws 2011, c. 278, &sect; 8; Laws 2011, c. 360, &sect; 8; Laws 2012, c. 45, &sect; 5, emerg. eff. April 16, 2012; Laws 2012, c. 365, &sect; 1, emerg. eff. June 8, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1102. Validity of contracts effectuated by a surplus lines insurer.&nbsp;</span></p> <p><span class="cls0">A contract of insurance effectuated by a surplus lines insurer in violation of this Code shall be voidable except at the instance of the insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 256, &sect; 1102, operative July 1, 1957. Amended by Laws 2010, c. 222, &sect; 11, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1103. Service of process on a surplus lines insurer.&nbsp;</span></p> <p><span class="cls0">A. Delivery, effectuation, or solicitation of any insurance contract, by mail or otherwise, within this state by a surplus lines insurer, or the performance within this state of any other service or transaction connected with the insurance by or on behalf of the insurer, shall be deemed to constitute an appointment by the insurer of the Insurance Commissioner as its attorney, upon whom may be served all lawful process issued within this state in any action or proceeding against the insurer arising out of any such contract or transaction.&nbsp;</span></p> <p><span class="cls0">B. Service of process shall be made by delivering to and leaving with the Insurance Commissioner three copies thereof. At time of service the plaintiff shall pay Twenty Dollars ($20.00) to the Insurance Commissioner, taxable as costs in the action. The Insurance Commissioner shall mail by registered mail one of the copies of the process to the defendant at any home state address as last known to the Insurance Commissioner, and shall keep a record of all process so served.&nbsp;</span></p> <p><span class="cls0">C. Service of process in any action or proceeding, in addition to the manner provided herein, shall also be valid if served upon any person within this state who, in this state on behalf of the insurer, is soliciting insurance, or making, issuing, or delivering any insurance policy, or collecting or receiving any premium, membership fee, assessment, or other consideration for insurance.&nbsp;</span></p> <p><span class="cls0">D. Service of process upon an insurer in accordance with this section shall be as valid and effective as if served upon a defendant personally present in this state.&nbsp;</span></p> <p><span class="cls0">E. Means provided in this section for service of process upon the insurer shall not be deemed to prevent service of process upon the insurer by any other lawful means.&nbsp;</span></p> <p><span class="cls0">F. An insurer which has been so served with process shall have the right to appear in and defend the action and employ attorneys and other persons in this state to assist in its defense or settlement.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 256, &sect; 1103, operative July 1, 1957. Amended by Laws 1985, c. 328, &sect; 8, emerg. eff. July 29, 1985; Laws 1997, c. 418, &sect; 38, eff. Nov. 1, 1997; Laws 2010, c. 222, &sect; 12, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 9 and Laws 2011, c. 360, &sect; 9; Laws 2012, c. 45, &sect; 6, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 9 and Laws 2011, c. 360, &sect; 9 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1104. Exemptions from service of process provisions.&nbsp;</span></p> <p><span class="cls0">Sections 1103 and 1105 of this article shall not apply to reinsurance, nor to any action or proceeding against a surplus lines insurer arising out of:&nbsp;</span></p> <p><span class="cls0">1. Ocean marine and foreign trade insurance,&nbsp;</span></p> <p><span class="cls0">2. Insurance on subjects located, resident, or to be performed wholly outside this state, or on vehicles or aircraft owned and principally garaged outside this state,&nbsp;</span></p> <p><span class="cls0">3. Insurance on property or operations of railroads engaged in interstate commerce, or&nbsp;</span></p> <p><span class="cls0">4. Insurance on aircraft or cargo of the aircraft, or against liability, other than employers' liability, arising out of the ownership, maintenance, or use of the aircraft, where the policy or contract contains a provision designating the Insurance Commissioner as its attorney for the acceptance of service of lawful process in any action or proceeding instituted by or on behalf of an insured or beneficiary arising out of any policy, or where the insurer enters a general appearance in any action.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 257, &sect; 1104, operative July 1, 1957. Amended by Laws 2010, c. 222, &sect; 13, eff. Nov. 1, 2010; Laws 2012, c. 45, &sect; 7, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1105. Attorney fees.&nbsp;</span></p> <p><span class="cls0">In any action against a surplus lines insurer pursuant to Section 1103 of this title, if the insurer has failed for thirty (30) days after demand prior to the commencement of the action to make payment in accordance with the terms of the contract of insurance or in accordance with Section 1115 of this title, and it appears to the court that the refusal was vexatious and without reasonable cause, the court may allow to the plaintiff or an aggrieved agency of this state a reasonable attorney fee and include the fee in any judgment that may be rendered in the action. The fee shall not exceed one-third (1/3) of the amount which the court or jury finds the plaintiff is entitled to recover against the insurer, but in no event shall a fee be less than One Hundred Dollars ($100.00). Failure of an insurer to defend any action shall be deemed prima facie evidence that its failure to make payment was vexatious and without reasonable cause.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 257, &sect; 1105, operative July 1, 1957. Amended by Laws 2010, c. 222, &sect; 14, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 10 and Laws 2011, c. 360, &sect; 10; Laws 2012, c. 45, &sect; 8, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 10 and Laws 2011, c. 360, &sect; 10 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1106. Surplus lines - Brokers.&nbsp;</span></p> <p><span class="cls0">If insurance required to protect the interest of the insured cannot be procured from admitted insurers after direct inquiry to authorized insurers, insurance may be procured from surplus lines insurers subject to the following conditions:&nbsp;</span></p> <p><span class="cls0">1. The surplus lines insurer shall meet the requirements of the Unauthorized Insurers and Surplus Lines Insurance Act and the following conditions:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the insurer has capital and surplus or its equivalent under the laws of its domiciliary jurisdiction which equals the greater of:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;the minimum capital and surplus requirements under the laws of this state for nonadmitted insurers, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;Fifteen Million Dollars ($15,000,000.00),&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the requirements of subparagraph a of this paragraph may be satisfied by an insurer's possessing less than the minimum capital and surplus upon an affirmative finding of acceptability by the Insurance Commissioner. The finding shall be based upon such factors as quality of management, capital and surplus of any parent company, company underwriting profit and investment income trends, market availability and company record and reputation within the industry. In no event shall the Insurance Commissioner make an affirmative finding of acceptability when the nonadmitted insurer's capital and surplus is less than Four Million Five Hundred Thousand Dollars ($4,500,000.00), and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the insurer, if an alien insurer, is listed on the National Association of Insurance Commissioners Nonadmitted Insurers Quarterly Listing; and&nbsp;</span></p> <p><span class="cls0">2. The insurance shall be procured through a licensed surplus lines licensee or broker licensed in the insurer's home state. An Oklahoma surplus lines license is required only where Oklahoma is the home state of the insurer.&nbsp;</span></p> <p><span class="cls0">For the purposes of carrying out the provisions of the Nonadmitted and Reinsurance Reform Act of 2010, the Insurance Commissioner is authorized to utilize the national insurance producer database of the National Association of Insurance Commissioners, or any other equivalent uniform national database, for the licensure of an individual or entity as a surplus lines licensee or broker and for renewal of such license.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 257, &sect; 1106, operative July 1, 1957. Amended by Laws 1986, c. 134, &sect; 3, emerg. eff. April 17, 1986; Laws 1991, c. 146, &sect; 1, eff. Sept. 1, 1991; Laws 1993, c. 79, &sect; 4, eff. Sept. 1, 1993; Laws 2006, c. 94, &sect; 1, eff. Nov. 1, 2006; Laws 2010, c. 222, &sect; 15, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 11; Laws 2011, c. 360, &sect; 11; Laws 2012, c. 45, &sect; 9, emerg. eff. April 16, 2012; Laws 2012, c. 365, &sect; 2, emerg. eff. June 8, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1106.1. Due diligence search.&nbsp;</span></p> <p><span class="cls0">A. A surplus lines licensee or broker is not required to make a due diligence search to determine whether the full amount or type of insurance can be obtained from admitted insurers when the surplus lines licensee or broker is seeking to procure or place nonadmitted insurance for an exempt commercial purchaser, provided:&nbsp;</span></p> <p><span class="cls0">1. The licensee or broker procuring or placing the surplus lines insurance has disclosed to the exempt commercial purchaser that such insurance may or may not be available from the admitted market that may provide greater protection with more regulatory oversight; and&nbsp;</span></p> <p><span class="cls0">2. The exempt commercial purchaser has subsequently requested in writing for the surplus lines broker to procure or place such insurance from a nonadmitted insurer.&nbsp;</span></p> <p><span class="cls0">B. For purposes of this section, the term "exempt commercial purchaser" means any person purchasing commercial insurance that, at the time of placement, meets the following requirements:&nbsp;</span></p> <p><span class="cls0">1. The person employs or retains a qualified risk manager to negotiate insurance coverage;&nbsp;</span></p> <p><span class="cls0">2. The person has paid aggregate nationwide commercial property and casualty insurance premiums in excess of One Hundred Thousand Dollars ($100,000.00) in the immediately preceding twelve (12) months;&nbsp;</span></p> <p><span class="cls0">3. The person meets at least one of the following criteria:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the person possesses a net worth in excess of Twenty Million Dollars ($20,000,000.00), as such amount is adjusted pursuant to paragraph 4 of this subsection,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the person generates annual revenues in excess of Fifty Million Dollars ($50,000,000.00), as such amount is adjusted pursuant to paragraph 4 of this subsection,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the person employs more than five hundred full-time-equivalent employees per individual insured or is a member of an affiliated group employing more than one thousand employees in the aggregate,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;the person is a not-for-profit organization or public entity generating annual budgeted expenditures of at least Thirty Million Dollars ($30,000,000.00), as such amount is adjusted pursuant to paragraph 4 of this subsection, or&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;the person is a municipality with a population in excess of fifty thousand (50,000) persons; and&nbsp;</span></p> <p><span class="cls0">4. Effective on January 1, 2015, and every five (5) years thereafter, the amounts in subparagraphs a, b and d of paragraph 3 of this subsection shall be adjusted to reflect the percentage change for such five-year period in the Consumer Price Index of All Urban Consumers published by the Bureau of Labor Statistics of the U.S. Department of Labor.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2011, c. 278, &sect; 12 and Laws 2011, c. 360, &sect; 12. Amended by Laws 2012, c. 45, &sect; 10, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 12 and Laws 2011, c. 360, &sect; 12 created identical sections with the same section number.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1107. Multistate risk - Required application and informational filings - Fee payments.&nbsp;</span></p> <p><span class="cls0">A. After procuring any surplus line insurance where Oklahoma is the home state and the insurance involves a multistate risk, the surplus lines licensee and broker shall submit such information relating to the transaction as may be established by the Insurance Commissioner. The data shall be provided to the Insurance Commissioner until and unless in the exercise of his or her sole discretion and judgment, the Insurance Commissioner decides to enter or join the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose and other reporting requirements are thereby established.&nbsp;</span></p> <p><span class="cls0">B. When Oklahoma is the home state of the insured, the surplus lines licensee or broker shall make all informational filings and fee payments in the manner required or to be established by the Insurance Commissioner. When Oklahoma is the home state of the insured, the premium tax filings and premium tax payments shall be provided entirely to the Insurance Commissioner until and unless, in the exercise of his or her sole discretion and judgment, the Insurance Commissioner decides to enter or join the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose.&nbsp;</span></p> <p><span class="cls0">C. Failure to file the required information, any required fee payments and make the required premium tax payments in the manner established by the Insurance Commissioner pursuant to this section and Section 1115 of this title where Oklahoma is the home state of the insured shall result, after notice and hearing, in censure, suspension, or revocation of license or a fine of up to Five Hundred Dollars ($500.00) for each occurrence or by both such fine and licensure penalty.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 257, &sect; 1107, operative July 1, 1957. Amended by Laws 1987, c. 175, &sect; 7, eff. Nov. 1, 1987; Laws 1991, c. 146, &sect; 2, eff. Sept. 1, 1991; Laws 2010, c. 222, &sect; 16, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 13; Laws 2011, c. 360, &sect; 13; Laws 2012, c. 45, &sect; 11, emerg. eff. April 16, 2012; Laws 2012, c. 365, &sect; 3, emerg. eff. June 8, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1108. Recognized surplus lines.&nbsp;</span></p> <p><span class="cls0">If a particular insurance coverage or type, class, or kind of coverage is not readily procurable from authorized insurers in Oklahoma, a surplus lines licensee or broker may place the coverage with a nonadmitted insurer or surplus lines insurer as defined in the Unauthorized Insurers and Surplus Lines Insurance Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 257, &sect; 1108, operative July 1, 1957. Amended by Laws 2010, c. 222, &sect; 17, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 14 and Laws 2011, c. 360, &sect; 14.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 14 and Laws 2011, c. 360, &sect; 14 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1109. Validity of surplus line insurance - Notice of limitations of coverage.&nbsp;</span></p> <p><span class="cls0">A. Insurance contracts procured as surplus line coverage from surplus lines insurers in accordance with this article shall be fully valid and enforceable as to all parties, and shall be given recognition in all matters and respects to the same effect as like contracts issued by admitted insurers.&nbsp;</span></p> <p><span class="cls0">B. Insurance contracts procured as surplus line coverage shall contain in bold-face type notification stamped by the surplus lines licensee or broker or surplus lines insurer on the declaration page of the policy that the contracts are not subject to the protection of any guaranty association in the event of liquidation or receivership of the surplus lines insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 258, &sect; 1109, operative July 1, 1957. Amended by Laws 1986, c. 251, &sect; 10, eff. Nov. 1, 1986; Laws 1991, c. 146, &sect; 3, eff. Sept. 1, 1991; Laws 2006, c. 264, &sect; 27, eff. July 1, 2006; Laws 2010, c. 222, &sect; 18, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 15 and Laws 2011, c. 360, &sect; 15; Laws 2012, c. 45, &sect; 12, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 15 and Laws 2011, c. 360, &sect; 15 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1111. Acceptance of surplus line business by brokers.&nbsp;</span></p> <p><span class="cls0">A surplus lines licensee or broker may accept and place surplus lines insurance from any insurance agent or broker licensed in this state for the kind of insurance involved, and may compensate such agent or broker therefor. The insurance agent or broker shall have the right to receive from the surplus lines insurer the customary commission.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 258, &sect; 1111, operative July 1, 1957. Amended by Laws 2011, c. 278, &sect; 16 and Laws 2011, c. 360, &sect; 16; Laws 2012, c. 45, &sect; 13, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 16 and Laws 2011, c. 360, &sect; 16 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1112. Solvent insurer required - License revocation - Penalties.&nbsp;</span></p> <p><span class="cls0">A. A surplus lines licensee or broker shall not knowingly place any such coverage with a nonadmitted insurer which is in an unsound financial condition. To be considered financially sound, a surplus lines insurer shall meet the requirements of Section 1106 of this title.&nbsp;</span></p> <p><span class="cls0">B. For violation of this section, in addition to any other penalty provided by law, the surplus lines broker's license shall be revoked, and the broker shall not again be so licensed within a period of two (2) years thereafter. In addition, any surplus lines licensee and broker who violates this section shall be guilty of a misdemeanor and upon conviction thereof shall be punished for each offense, by a fine of not more than One Thousand Dollars ($1,000.00) or by confinement in jail for not more than ninety (90) days, or by both such fine and imprisonment.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 258, &sect; 1112, operative July 1, 1957. Amended by Laws 1965, c. 132, &sect; 1, eff. Oct. 1, 1965; Laws 1991, c. 146, &sect; 4, eff. Sept. 1, 1991; Laws 2002, c. 307, &sect; 10, eff. Nov. 1, 2002; Laws 2011, c. 278, &sect; 17 and Laws 2011, c. 360, &sect; 17; Laws 2012, c. 45, &sect; 14, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 17 and Laws 2011, c. 360, &sect; 17 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1113. Records of surplus lines licensees or brokers.&nbsp;</span></p> <p><span class="cls0">Each surplus lines licensee or broker licensed in Oklahoma shall keep a full and true record of each surplus lines contract procured by the surplus lines broker, and such record may be examined at any time within three (3) years thereafter by the Insurance Commissioner. The record shall include such information required to be submitted as established by the Insurance Commissioner in this article.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 258, &sect; 1113, operative July 1, 1957. Amended by Laws 1997, c. 418, &sect; 39, eff. Nov. 1, 1997; Laws 2011, c. 278, &sect; 18; Laws 2011, c. 360, &sect; 18; Laws 2012, c. 45, &sect; 15, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1114. Broker's annual statement.&nbsp;</span></p> <p><span class="cls0">Each surplus lines licensee or broker licensed or transacting business in Oklahoma shall on or before April 1 of each year file with the Insurance Commissioner a verified statement of all surplus lines insurance transacted by the broker during the preceding calendar year where Oklahoma is the home state of the insured. The statement shall be on a form prescribed and furnished by the Insurance Commissioner and shall show such information required to be submitted as established by the Insurance Commissioner. The information shall be provided to the Insurance Commissioner until and unless, in the exercise of his or her sole discretion and judgment, the Insurance Commissioner decides to enter or join the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose and other transaction reporting requirements are thereby established.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 259, &sect; 1114, operative July 1, 1957. Amended by Laws 2011, c. 278, &sect; 19; Laws 2011, c. 360, &sect; 19; Laws 2012, c. 45, &sect; 16, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1115. Tax on surplus lines - Surplus lines insurer.&nbsp;</span></p> <p><span class="cls0">A. Where Oklahoma is the home state of the insured, every person licensed pursuant to Section 1106 of this title shall collect and pay as provided in this section a sum for premium tax based on the total gross premiums charged in connection with any broker-procured surplus lines insurance, less any return premiums, for surplus lines insurance sold to the Oklahoma home-state insureds by the surplus lines broker or licensee.&nbsp;</span></p> <p><span class="cls0">B. Where Oklahoma is the home state of the insured and the insurance covers properties, risks or exposures located or to be performed both in and out of Oklahoma, the sum payable to the Oklahoma Insurance Commissioner shall be computed based on an amount equal to six percent (6%) of the total gross premiums whether the properties, risks or exposures are located or to be performed inside or outside Oklahoma. Any such unearned gross premium credited by the state to the surplus lines broker or licensee shall be returned to the policyholder by the broker or licensee. The surplus lines licensee or broker is prohibited from rebating, for any reason, any part of the tax.&nbsp;</span></p> <p><span class="cls0">C. Where Oklahoma is the home state of the insured, gross premiums charged for independently procured insurance, less any return premiums, are subject to a premium tax at the rate of six percent (6%) payable to the Oklahoma Insurance Commissioner, whether the properties, risks or exposures are located or to be performed inside or outside Oklahoma.&nbsp;</span></p> <p><span class="cls0">D. The Insurance Commissioner is authorized, in the exercise of his or her sole discretion and judgment, to participate in the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose for the function of collecting and disbursing to reciprocal states any funds collected pursuant to the Unauthorized Insurers and Surplus Lines Insurance Act applicable to other properties, risks or exposures located or to be performed outside of Oklahoma. Until such time as the Insurance Commissioner may, while not being required to, join such multistate agreement or compact, premium taxes relating to Oklahoma home-state insureds shall continue to be paid and accounted for by nonadmitted insurers through their surplus lines licensees and brokers as provided in subsections A through C of this section.&nbsp;</span></p> <p><span class="cls0">E. When the surplus lines coverage of an Oklahoma homestate insured covers properties, risks or exposures located only in Oklahoma, the surplus lines licensee or broker or self-procuring insured shall pay the surplus lines premium tax payable on such Oklahoma-only risks solely to the Oklahoma Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">F. Should the Insurance Commissioner exercise his or her sole discretion and judgment and decide to join the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose, the Insurance Commissioner is authorized in such event to establish a uniform, statewide rate of taxation applicable to lines of nonadmitted insurance. This rate shall encompass all existing rates of taxation, fees and assessments imposed by this state, pursuant to subsections A through C of this section and the Insurance Commissioner shall document the method by which the statewide rate is calculated. The Insurance Commissioner is authorized to receive any monies obtained as premium tax received through any multistate agreement he or she may in the future in his or her discretion choose to join and then disburse such funds as provided by the Insurance Code and other applicable Oklahoma law.&nbsp;</span></p> <p><span class="cls0">G. Should the Insurance Commissioner exercise his or her sole discretion and decide to join the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact with the same function and purpose, the Insurance Commissioner is authorized in such circumstances to utilize or adopt any allocation schedule included in the Nonadmitted Insurance Multi-State Agreement or any other multistate agreement or compact the Insurance Commissioner may enter in the exercise of his or her sole discretion and judgment which schedule has the function and purpose of allocating risk and computing the tax due on the portion of premium attributable to each risk classification and to each state where properties, risks or exposures are located.&nbsp;</span></p> <p><span class="cls0">H. Policies sold to federally recognized Indian tribes shall be reported as provided in Section 1107 of this title; however, these policies shall be exempt from the surplus line premium tax to the extent that the Insurance Commissioner can identify that coverage is for risks which are wholly owned by a tribe and located within Indian Country, as defined in Section 1151 of Title 18 of the United States Code.&nbsp;</span></p> <p><span class="cls0">I. The surplus line premium tax on insurance on motor transit operations conducted between this and other states shall be paid on the total premium charged on all surplus line insurance less:&nbsp;</span></p> <p><span class="cls0">1. The portion of the premium charged for operations in other states taxing the premium of an insured where Oklahoma is the home state; or&nbsp;</span></p> <p><span class="cls0">2. The premium for operations outside of this state of an insured maintaining its headquarters office outside of this state and branch office in this state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 259, &sect; 1115, operative July 1, 1957. Amended by Laws 1959, p. 134, &sect; 1, emerg. eff. July 8, 1959; Laws 1961, p. 268, &sect; 1, emerg. eff. July 5, 1961; Laws 1963, c. 48, &sect; 1, emerg. eff. May 2, 1963; Laws 1965, c. 270, &sect; 1, emerg. eff. June 23, 1965; Laws 1967, c. 194, &sect; 1, emerg. eff. May 1, 1967; Laws 1968, c. 111, &sect; 1, emerg. eff. April 1, 1968; Laws 1969, c. 82, &sect; 1, emerg. eff. March 18, 1969; Laws 1970, c. 288, &sect; 1, emerg. eff. April 27, 1970; Laws 1971, c. 67, &sect; 1, emerg. eff. April 12, 1971; Laws 1972, c. 54, &sect; 1, emerg. eff. March 20, 1972; Laws 1983, c. 248, &sect; 5, emerg. eff. June 21, 1983; Laws 1991, c. 146, &sect; 5, eff. Sept. 1, 1991; Laws 1997, c. 418, &sect; 40, eff. Nov. 1, 1997; Laws 1999, c. 96, &sect; 1, emerg. eff. April 19, 1999; Laws 2009, c. 432, &sect; 9, eff. July 1, 2009; Laws 2010, c. 222, &sect; 19, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 20; Laws 2011, c. 360, &sect; 20; Laws 2012, c. 45, &sect; 17, emerg. eff. April 16, 2012; Laws 2012, c. 365, &sect; 4, emerg. eff. June 8, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1116. Penalty for failure to remit tax.&nbsp;</span></p> <p><span class="cls0">A. Any surplus lines licensee or broker who fails to remit the surplus line tax provided for by Section 1115 of this title for more than sixty (60) days after it is due shall be liable for a civil penalty of not to exceed Twenty-five Dollars ($25.00) for each additional day of delinquency. The Insurance Commissioner shall collect the tax by distraint and shall recover the penalty by an action in the name of the State of Oklahoma. The Commissioner may request the Attorney General to appear in the name of the state by relation of the Commissioner.&nbsp;</span></p> <p><span class="cls0">B. If any person, association or legal entity procuring or accepting any insurance coverage from a surplus lines insurer where Oklahoma is the home state of the insured, otherwise than through a surplus lines licensee or broker, fails to remit the surplus line tax provided for by Section 1115 of this title, the person, association or legal entity shall, in addition to the tax, be liable to a civil penalty in an amount equal to one percent (1%) of the premiums paid or agreed to be paid for the policy or policies of insurance for each calendar month of delinquency or a civil penalty in the amount of Twenty-five Dollars ($25.00) whichever shall be the greater. The Insurance Commissioner shall collect the tax by distraint and shall recover the civil penalty in an action in the name of the State of Oklahoma. The Commissioner may request the Attorney General to appear in the name of the state by relation of the Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 259, &sect; 1116, operative July 1, 1957. Amended by Laws 1959, p. 135, &sect; 1, emerg. eff. July 8, 1959; Laws 1991, c. 146, &sect; 6, eff. Sept. 1, 1991; Laws 1992, c. 65, &sect; 2, eff. Sept. 1, 1992; Laws 1997, c. 418, &sect; 41, eff. Nov. 1, 1997; Laws 2009, c. 432, &sect; 10, eff. July 1, 2009; Laws 2010, c. 222, &sect; 20, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 21 and Laws 2011, c. 360, &sect; 21; Laws 2012, c. 45, &sect; 18, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 21 and Laws 2011, c. 360, &sect; 21 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1118. Legal process against surplus line insurer.&nbsp;</span></p> <p><span class="cls0">A. Every surplus lines insurer issuing or delivering a surplus line policy through a surplus lines licensee or broker in this state shall conclusively be deemed thereby to have irrevocably appointed the Insurance Commissioner as its attorney for acceptance of service of all legal process, other than a subpoena, issued in this state in any action or proceeding under or arising out of the policy, and service of process upon the Insurance Commissioner shall be lawful personal service upon the surplus lines or nonadmitted insurer.&nbsp;</span></p> <p><span class="cls0">B. Each surplus line policy shall contain a provision stating the substance of subsection A of this section, and designating the person to whom the Insurance Commissioner shall mail process as provided in subsection C of this section.&nbsp;</span></p> <p><span class="cls0">C. Triplicate copies of legal process against such an insurer shall be served upon the Insurance Commissioner, and at time of service the plaintiff shall pay to the Insurance Commissioner Twenty Dollars ($20.00), taxable as costs in the action. The Insurance Commissioner shall immediately mail one copy of the process so served to the person designated by the insurer in the policy for the purpose, by mail with return receipt requested. The surplus lines or nonadmitted insurer shall have forty (40) days after the date of mailing within which to plead, answer, or otherwise defend the action.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 260, &sect; 1118, operative July 1, 1957. Amended by Laws 1986, c. 251, &sect; 11, eff. Nov. 1, 1986; Laws 1997, c. 418, &sect; 42, eff. Nov. 1, 1997; Laws 2010, c. 222, &sect; 21, eff. Nov. 1, 2010; Laws 2011, c. 278, &sect; 22 and Laws 2011, c. 360, &sect; 22; Laws 2012, c. 45, &sect; 19, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 278, &sect; 22 and Laws 2011, c. 360, &sect; 22 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;361119. Exemptions from surplus lines provisions.&nbsp;</span></p> <p><span class="cls0">The sections of this article relative to surplus line coverages shall not apply to reinsurance.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 260, &sect; 1119. &nbsp;</span></p> <p><span class="cls0">&sect;36-1120. Records of insureds.&nbsp;</span></p> <p><span class="cls0">Upon request of the Insurance Commissioner any person in Oklahoma who is the insured under any policy issued by a surplus lines insurer upon a subject of insurance resident, located, or to be performed in Oklahoma at the time the policy was issued, or where the insured's home state is Oklahoma, shall produce for examination all policies and other documents evidencing and relating to the insurance, and shall disclose the amount of the gross premiums paid or agreed to be paid for the insurance, through whom the insurance was procured, and such other information relative to the placing of the insurance as may reasonably be required by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 260, &sect; 1120, operative July 1, 1957. Amended by Laws 2010, c. 222, &sect; 22, eff. Nov. 1, 2010; Laws 2012, c. 45, &sect; 20, emerg. eff. April 16, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1125. Filing requirements.&nbsp;</span></p> <p><span class="cls0">A. Every property and casualty insurance company doing business in this state, unless otherwise exempted by the domiciliary commissioner, shall annually submit the opinion of an appointed actuary entitled &ldquo;Statement of Actuarial Opinion&rdquo;. This opinion shall be filed in accordance with the appropriate NAIC Property and Casualty Annual Statement Instructions.&nbsp;</span></p> <p><span class="cls0">B. 1. Every property and casualty insurance company domiciled in this state that is required to submit a Statement of Actuarial Opinion shall annually submit an actuarial opinion summary written by the company&rsquo;s appointed actuary. This actuarial opinion summary shall be filed in accordance with the appropriate NAIC Property and Casualty Annual Statement Instructions and shall be considered as a document supporting the actuarial opinion required in subsection A of this section.&nbsp;</span></p> <p><span class="cls0">2. A company licensed but not domiciled in this state shall provide the actuarial opinion summary upon request.&nbsp;</span></p> <p><span class="cls0">C. 1. An actuarial report and underlying workpapers as required by the appropriate NAIC Property and Casualty Annual Statement Instructions shall be prepared to support each actuarial opinion.&nbsp;</span></p> <p><span class="cls0">2. If the insurance company fails to provide a supporting actuarial report and/or workpapers at the request of the Insurance Commissioner or the Commissioner determines that the supporting actuarial report or workpapers provided by the insurance company are otherwise unacceptable to the Commissioner, the Commissioner may engage a qualified actuary at the expense of the company to review the opinion and the basis for the opinion and prepare the supporting actuarial report or workpapers.&nbsp;</span></p> <p><span class="cls0">D. The appointed actuary shall not be liable for damages to any person, other than the insurance company and the Commissioner, for any act, error, omission, decision or conduct with respect to the actuary&rsquo;s opinion, except in cases of fraud or willful misconduct on the part of the appointed actuary.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 28, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1126. Public access to documents and reports - Confidentiality.&nbsp;</span></p> <p><span class="cls0">A. The Statement of Actuarial Opinion shall be provided with the annual statement in accordance with the appropriate National Associations of Insurance Commissioners Property and Casualty Annual Statement Instructions and shall be treated as a public document.&nbsp;</span></p> <p><span class="cls0">B. 1. Documents, materials or other information in the possession or control of the Insurance Department that are considered an actuarial report, work papers or actuarial opinion summary provided in support of the opinion, and any other material provided by the company to the Insurance Commissioner in connection with the actuarial report, work papers or actuarial opinion summary, and any work papers used by the Commissioner or any other person in the analysis of the actuarial report, work papers, other material or actuarial opinion summary provided in support of the opinion, shall be confidential by law and privileged, shall not be subject to the Oklahoma Open Records Act, shall not be subject to subpoena, and shall not be subject to discovery or admissible in evidence in any private civil action. The confidentiality and protection from discovery by subpoena provided in this paragraph shall not be construed to be extended to identical, similar or other related documents or information or to the work papers that are not deemed to be in the possession, custody or control of the Commissioner.&nbsp;</span></p> <p><span class="cls0">2. This provision shall not be construed to limit the Commissioner&rsquo;s authority to release the documents to the Actuarial Board for Counseling and Discipline (ABCD) so long as the material is required for the purpose of professional disciplinary proceedings and the ABCD establishes procedures satisfactory to the Commissioner for preserving the confidentiality of the documents, nor shall this section be construed to limit the Commissioner&rsquo;s authority to use the documents, materials or other information in furtherance of any regulatory or legal action brought as part of the Commissioner&rsquo;s official duties.&nbsp;</span></p> <p><span class="cls0">C. Neither the Commissioner nor any person who received documents, materials or other information while acting under the authority of the Commissioner shall be permitted or required to testify in any private civil action concerning any confidential documents, materials or information subject to subsection B of this section.&nbsp;</span></p> <p><span class="cls0">D. In order to assist in the performance of the Commissioner&rsquo;s duties, the Commissioner:&nbsp;</span></p> <p><span class="cls0">1. May share documents, materials or other information, including the confidential and privileged documents, materials or information subject to subsection B of this section with other state, federal and international regulatory agencies, with the National Association of Insurance Commissioners and its affiliates and subsidiaries, and with state, federal and international law enforcement authorities; provided, that the recipient agrees to maintain the confidentiality and privileged status of the document, material or other information and has the legal authority to maintain confidentiality;&nbsp;</span></p> <p><span class="cls0">2. May receive documents, materials or information, including otherwise confidential and privileged documents, materials or information, from the National Association of Insurance Commissioners and its affiliates and subsidiaries, and from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material or information; and&nbsp;</span></p> <p><span class="cls0">3. May enter into agreements governing sharing and use of information consistent with subsections B through D of this section.&nbsp;</span></p> <p><span class="cls0">E. No waiver of any applicable privilege or claim of confidentiality in the documents, materials or information shall occur as a result of disclosure to the Commissioner under this section or as a result of sharing as authorized in subsection D of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 29, eff. July 1, 2006. Amended by Laws 2010, c. 356, &sect; 3, eff. Nov. 1, 2010; Laws 2012, c. 149, &sect; 1, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1140. Definitions - Licensing - Application - Duration of license.&nbsp;</span></p> <p><span class="cls0">A. &ldquo;Advisory organization&rdquo; means a corporation, an unincorporated association, a partnership or an individual, whether located inside or outside of this state, organized and licensed for the purpose of making rates, loss costs, rating plans, statistical collection, furnishing statistical data, policy forms and endorsements or rating systems.&nbsp;</span></p> <p><span class="cls0">B. The term &ldquo;advisory organization&rdquo; shall be synonymous with the terms &ldquo;bureau&rdquo;, &ldquo;statistical agent&rdquo; and &ldquo;rating organization&rdquo;.&nbsp;</span></p> <p><span class="cls0">C. No advisory organization shall provide any service relating to the loss costs, rates, rating plans, manual rules, rating systems or policy forms of any property and casualty insurance products subject to the provisions of the Oklahoma Insurance Code and no insurer shall utilize the services of such organization unless the organization has obtained a license.&nbsp;</span></p> <p><span class="cls0">D. No advisory organization shall refuse to supply any services for which it is licensed in this state to any insurer authorized to do business in this state and offering to pay the usual compensation for the services.&nbsp;</span></p> <p><span class="cls0">E. 1. An advisory organization applying for a license shall include with its application:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;a copy of its constitution, charter, articles of organization, agreement, association or incorporation, and a copy of its bylaws, plan of operation and any other rules or regulations governing the conduct of its business,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;a list of its members and subscribers,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the name and address of one or more residents of this state upon whom notices, process affecting it, or orders of the Insurance Commissioner may be served,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;a statement showing its technical qualifications for acting in the capacity for which it seeks a license,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;a biography of the ownership and management of the organization, and&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;any other relevant information and documents that the Commissioner may require.&nbsp;</span></p> <p><span class="cls0">2. Every organization which has applied for a license shall notify the Commissioner of every material change in the facts or in the documents on which its application was based. Any amendment to a document filed under this section shall be filed at least thirty (30) days before it becomes effective.&nbsp;</span></p> <p><span class="cls0">3. If the Commissioner finds that the applicant and the natural persons through whom it acts are competent, trustworthy and technically qualified to provide the services proposed, and that all requirements of the law are met, the Commissioner shall issue a license specifying the authorized activity of the applicant. The Commissioner shall not issue a license if the proposed activity would tend to create a monopoly or to substantially lessen the competition in the market.&nbsp;</span></p> <p><span class="cls0">4. Licenses issued pursuant to this section shall remain in force for one (1) year unless suspended or revoked. The Commissioner may at any time, after a hearing, revoke or suspend the license of any advisory organization that does not comply with the requirements and standards of the applicable provisions of the Insurance Code.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 30, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1141. Prohibited conduct.&nbsp;</span></p> <p><span class="cls0">A. No advisory organization shall:&nbsp;</span></p> <p><span class="cls0">1. Attempt to monopolize, or combine or conspire with any person or persons to monopolize, an insurance market;&nbsp;</span></p> <p><span class="cls0">2. Engage in a boycott, on a concerted basis, of an insurance market; and&nbsp;</span></p> <p><span class="cls0">3. Except as set forth in subsection B of this section, agree to mandate adherence to or to mandate use of any rate, prospective loss cost, rating plan, rating schedule, rating rule, policy or bond form, rate classification, rate territory, underwriting rule, survey, inspection or similar material. Insurers and advisory organizations may agree to develop and adhere to statistical plans permitted by the applicable provisions of the Oklahoma Insurance Code.&nbsp;</span></p> <p><span class="cls0">B. Except as specifically permitted under the applicable provisions of the Insurance Code, no advisory organization shall compile or distribute recommendations relating to rates that include expenses, other than loss adjustment expenses or loss-based taxes and assessments, or profit.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 31, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1142. Permitted activities and services.&nbsp;</span></p> <p><span class="cls0">Any licensed advisory organization, in addition to other activities not prohibited, is authorized on behalf of its members and subscribers to:&nbsp;</span></p> <p><span class="cls0">1. Develop statistical plans including territorial and class definitions;&nbsp;</span></p> <p><span class="cls0">2. Collect statistical data from members, subscribers or any other source;&nbsp;</span></p> <p><span class="cls0">3. Prepare, file and distribute prospective loss costs which may include provisions for special assessments and taxes;&nbsp;</span></p> <p><span class="cls0">4. Prepare, file and distribute factors, calculations or formulas pertaining to classification, territory, increased limits and other variables;&nbsp;</span></p> <p><span class="cls0">5. Prepare, file and distribute manuals of rating rules, rating schedules and other supplementary rating information that does not include final rates, expense provisions, profit provisions or minimum premiums;&nbsp;</span></p> <p><span class="cls0">6. Distribute information that is required or directed to be filed with the Commissioner;&nbsp;</span></p> <p><span class="cls0">7. Conduct research and on-site inspections in order to prepare classifications of public fire defenses;&nbsp;</span></p> <p><span class="cls0">8. Consult with public officials regarding public fire protection as it would affect members, subscribers and others;&nbsp;</span></p> <p><span class="cls0">9. Conduct research and collect statistics in order to discover, identify and classify information relating to causes or prevention of losses;&nbsp;</span></p> <p><span class="cls0">10. Conduct research and collect information to determine the impact of statutory and other law changes upon prospective loss costs and special assessments;&nbsp;</span></p> <p><span class="cls0">11. Prepare, file and distribute policy forms and endorsements and consult with members, subscribers and others relative to their use and application;&nbsp;</span></p> <p><span class="cls0">12. Conduct research and on-site inspections for the purpose of providing risk information relating to individual structures;&nbsp;</span></p> <p><span class="cls0">13. Conduct on-site inspections to determine rating classifications for individual insureds;&nbsp;</span></p> <p><span class="cls0">14. Collect, compile and publish past and current prices of individual insurers; provided, such information is also made available to the general public for a reasonable price;&nbsp;</span></p> <p><span class="cls0">15. Collect and compile exposure and loss experience for the purpose of individual risk experience ratings;&nbsp;</span></p> <p><span class="cls0">16. File final rates for residual market mechanisms; and&nbsp;</span></p> <p><span class="cls0">17. Furnish any other services, as approved or directed by the Insurance Commissioner, related to those enumerated in this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 32, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1143. Review of advisory organization actions.&nbsp;</span></p> <p><span class="cls0">A. Every advisory organization which makes its own rates shall provide within this state reasonable means whereby any insured aggrieved by the application of its rating system may, upon that insured's written request, be heard in person or by the insured's authorized representative to review the manner in which such rating system has been applied in connection with the insurance afforded the aggrieved insurer.&nbsp;</span></p> <p><span class="cls0">B. An insurer or any party affected by the action of an advisory organization may, within thirty (30) days after written notice of that action, make application, in writing, for an appeal to the Insurance Commissioner, setting forth the basis for the appeal and the grounds to be relied upon by the applicant.&nbsp;</span></p> <p><span class="cls0">C. Within thirty (30) days, the Commissioner shall review the application and, if the Commissioner finds that the application is made in good faith and that it sets forth on its face grounds which reasonably justify holding a hearing, the Commissioner shall conduct a hearing held not less than ten (10) days after written notice to the applicant and to the advisory organization. The Commissioner, after a hearing, shall affirm or reverse the action of the advisory organization.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 33, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1144. Examination by Insurance Commissioner - Scope - Report by official of another state.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall make or cause to be made, at least once in five (5) years, an examination of each advisory organization licensed in this state as provided in this act, and the Commissioner may, as often as it may deem expedient, make or cause to be made an examination of each advisory organization referred to in this act, and of each group, association, or other organization referred to in this act. The reasonable cost of any such examination shall be paid by the organization examined, upon presentation of a detailed account of such costs.&nbsp;</span></p> <p><span class="cls0">B. The officers, managers, agents and employees of such advisory organization may be examined, at any time, under oath, and shall exhibit all books, records, accounts, documents or agreements governing its method of operation.&nbsp;</span></p> <p><span class="cls0">C. In lieu of any such examination, the Commissioner may accept the report of an examination made by the insurance supervisory official of another state, pursuant to the laws of such state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264 &sect; 34, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1145. Rules and statistical plans - Commissioner authority to promulgate - Scope.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall promulgate rules and statistical plans adapted to each of the rating systems on file, which may be modified, from time to time, and which shall be used thereafter by each insurer in the recording and reporting of its loss and countrywide expense experience, in order that the experience of all insurers may be made available, at least annually, in such form and detail as may be necessary to aid it in determining whether rating systems comply with the standards set forth in this act.&nbsp;</span></p> <p><span class="cls0">1. Such rules and plans may also provide for the recording and reporting of expense experience items which are specially applicable to this state and are not susceptible to determination by a prorating of countrywide expense experience.&nbsp;</span></p> <p><span class="cls0">2. In promulgating such rules and plans, the Commissioner shall give due consideration to the rating system on file and, in order that such rules and plans may be as uniform as is practicable among the several states, to the rules and to the form of the plans used for such rating systems in other states.&nbsp;</span></p> <p><span class="cls0">3. No insurer shall be required to record or report its loss experience on a classification basis that is inconsistent with the rating system filed by it.&nbsp;</span></p> <p><span class="cls0">4. The Commissioner may designate one or more advisory organizations or other agencies to assist it in gathering such experience and making compilations thereof, and such compilations shall be made available, subject to reasonable rules promulgated by the Commissioner, to insurers and advisory organizations.&nbsp;</span></p> <p><span class="cls0">B. Reasonable rules and plans may be promulgated by the Commissioner for the interchange of data necessary for the application of rating plans.&nbsp;</span></p> <p><span class="cls0">C. In order to further uniform administration of rate regulatory laws, the Commissioner and every insurer and advisory organization may exchange information and experience data with insurance supervisory officials, insurers and rating organizations in other states and may consult with them with respect to ratemaking and the application of rating systems.&nbsp;</span></p> <p><span class="cls0">D. The Commissioner may make reasonable rules and regulations necessary to effect the purposes of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 35, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1146. Withholding or providing false or fraudulent information - Prohibition - Punishment.&nbsp;</span></p> <p><span class="cls0">A. No person shall willfully withhold information from, or knowingly give false or misleading information to, the Insurance Commissioner, or any advisory organization designated by the Commissioner, which will affect the rates or premiums chargeable under this act.&nbsp;</span></p> <p><span class="cls0">B. A person convicted of violating this section shall be guilty of a felony and, upon conviction, shall be punished by a fine of not less than One Thousand Dollars ($1,000.00) nor more than Ten Thousand Dollars ($10,000.00), or by imprisonment of not more than three (3) years or by both such fine and imprisonment.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 36, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1147. Suspension or revocation of license - Commissioner authority - Procedure.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may suspend the license of any advisory organization which fails to comply with an order of the Commissioner within the time limit established by such order, or any extension thereof which the Commissioner may grant. The Commissioner shall not suspend the license of any advisory organization for failure to comply with an order until the time prescribed for judicial review has expired or if an action for judicial review has been commenced, until the order has been affirmed or the action has been dismissed. The Commissioner may determine when a suspension of license shall become effective and when it shall terminate, unless it modifies or rescinds the suspension, or until the order upon which the suspension is based is modified, rescinded or reversed.&nbsp;</span></p> <p><span class="cls0">B. No license shall be suspended or revoked except upon a written order of the Commissioner, stating its findings of fact and conclusions of law, made after a hearing held upon not less than ten (10) days' written notice, to the person or legal entity, specifying the alleged violation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 37, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1148. Adherence to loss cost filings - Application to workers' compensation insurance.&nbsp;</span></p> <p><span class="cls0">Applicable to workers&rsquo; compensation insurance only, every member of, or subscriber to, a licensed advisory organization shall adhere to the loss cost filings made on its behalf by such organization within ninety (90) days of the effective date of the loss cost filing.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 38, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1161. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in this act:&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Adverse tier placement&rdquo; means being subject to the rates of any tier with less coverage or higher premiums than the tier within which the insured is currently insured;&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Federal government-sponsored health insurance program&rdquo; means the TriCare program providing coverage for civilian dependents of military personnel;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Health plan&rdquo; means any insurance company or health maintenance organization which issues individual coverage to a resident of this state;&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Individual coverage&rdquo; means health insurance or health maintenance organization coverage issued on other than a group or blanket basis, including an individual coverage containing coverage for a spouse, dependent, or both;&nbsp;</span></p> <p><span class="cls0">5. &ldquo;Insureds&rdquo; means persons enrolled under individual coverage issued by a health plan. Insureds include persons covered under a policy of personal insurance; and&nbsp;</span></p> <p><span class="cls0">6. &ldquo;Personal insurance&rdquo; means private passenger automobile, motorcycle, mobile homeowners, homeowners, renters and noncommercial-dwelling fire insurance policies and boat, personal watercraft, snowmobile and recreational vehicle policies.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 39, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1162. Reinstatement into individual health plan coverage - Right to request - Time - Written notice.&nbsp;</span></p> <p><span class="cls0">A. No Oklahoma resident activated for military service, and no spouse or any dependents of such a resident who become eligible for a federal government-sponsored health insurance program as a result of such activation, shall be denied reinstatement into the same individual coverage with the same health plan that such resident lapsed as a result of activation or becoming covered by the federal government-sponsored health insurance program. Such resident will have the right to reinstatement in the same individual coverage without medical underwriting and in the same rating tier that the resident held prior to activation or becoming covered under the federal government-sponsored health insurance program, subject to payment of the current premium charged to other persons of the same age and gender that are covered under the same individual coverage. Except in the case of birth or adoptions that occur during the period of activation, reinstatement must be into the same membership type, or a membership type covering fewer persons, as such resident held prior to lapsing the individual coverage, and at the same or higher deductible level. The reinstatement rights shall not be available to an insured or dependents if the activated person is discharged from the military under other than honorable conditions.&nbsp;</span></p> <p><span class="cls0">B. The health plan with which the reinstatement is being requested must receive a request for such reinstatement no later than thirty (30) days following the later of deactivation or loss of coverage under the federal government-sponsored health insurance program. The health plan may request proof of loss and the timing of the loss of such government-funded coverage in order to determine eligibility for reinstatement into the individual coverage. The effective date of the individual coverage will be the first of the month following receipt of the notice requesting reinstatement.&nbsp;</span></p> <p><span class="cls0">C. All health plans must provide written notice to the policyholder of individual coverage of the rights described in subsection A of this section and amendments thereto. In lieu of the inclusion of such notice in the individual coverage policy, an insurance company will satisfy the notification requirement by providing a single written notice either:&nbsp;</span></p> <p><span class="cls0">1. To a policyholder enrolling into the individual coverage initially after the effective date of this act, in conjunction with the enrollment process; or&nbsp;</span></p> <p><span class="cls0">2. By mailing written notice to policyholders whose coverage was effective prior to the effective date of this act no later than ninety (90) days following the effective date of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 40, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1163. Exclusion from application for certain policies or coverage certificates.&nbsp;</span></p> <p><span class="cls0">The provisions of Section 40 of this act and amendments thereto shall not apply to any policy or certificate providing coverage for any specified disease, specified accident or accident-only coverage, credit, dental, disability income, hospital indemnity, long-term care, as defined by Article 44 of Title 36 of the Oklahoma Statutes and any amendments thereto, Medicare supplement, as defined by the Insurance Commissioner by rules and regulations, vision care, short-term nonrenewable health policy or other limited-benefit supplemental insurance, nor any coverage issued as a supplement to any liability insurance, workers&rsquo; compensation or similar insurance, or any insurance under which benefits are payable with or without regard to fault, whether written on a group, blanket or individual basis.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 41, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1164. Exclusion from application for certain unmet terms, conditions and limitations.&nbsp;</span></p> <p><span class="cls0">A. Nothing herein shall require a health plan to reinstate such resident if the health plan requires residency in an enrollment area and those residency requirements are not met after deactivation or loss of coverage under the federal government-sponsored health insurance program.&nbsp;</span></p> <p><span class="cls0">B. All terms, conditions and limitations of the individual coverage into which reinstatement is made will apply equally to all insureds enrolled in such coverage.&nbsp;</span></p> <p><span class="cls0">C. No personal insurance issued to an Oklahoma resident on active military deployment beyond the borders of the United States of America, or the spouse or any dependent of such Oklahoma resident, shall be subject to cancellation, nonrenewal, denial of coverage, premium increase or adverse tier placement for the term of their deployment based solely upon said Oklahoma resident&rsquo;s military deployment.&nbsp;</span></p> <p><span class="cls0">D. The Insurance Commissioner is hereby authorized to adopt such rules and regulations as may be necessary to carry out the provisions of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 42, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1165. Participation in employer sponsored health plan - Retired military employees.&nbsp;</span></p> <p><span class="cls0">No employer shall require any employee who is retired from a branch of the United States military and has been provided with health coverage through a federal plan to participate in employer-sponsored health insurance coverage if the health insurance coverage requires a contribution from the employee. The employee shall provide to the employer before the beginning of each plan year proof of that coverage.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2012, c. 260, &sect; 1, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;361201. Declaration of purpose.&nbsp;</span></p> <p><span class="cls0">The purpose of this article is to regulate trade practices in the business of insurance in accordance with the intent of Congress as expressed in the Act of Congress of March 9, 1945 (Public Law 15, 79th Congress), by defining, or providing for the determination of, all such practices in this state which constitute unfair methods of competition or unfair or deceptive acts or practices and by prohibiting the trade practices so defined or determined.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 260, &sect; 1201. &nbsp;</span></p> <p><span class="cls0">&sect;361202. Definitions.&nbsp;</span></p> <p><span class="cls0">When used in this article:&nbsp;</span></p> <p><span class="cls0">1. "Person" shall mean any individual, corporation, association, partnership, reciprocal exchange, interinsurer, Lloyd's insurer, Lloyd's Name, Lloyd's Syndicate Name, fraternal benefit society, and any other legal entity engaged in the business of insurance, including agents, brokers and adjusters;&nbsp;</span></p> <p><span class="cls0">2. "Commissioner" shall mean the Insurance Commissioner of this state; and&nbsp;</span></p> <p><span class="cls0">3. "Name" shall mean any individual or corporate entity underwriting insurance for their own account through the Lloyd's of London market and any agents or employees of any such individual or corporate entity.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 260, &sect; 1202. Amended by Laws 1996, c. 246, &sect; 1, eff. July 1, 1996.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361203. Unfair methods of competition or unfair and deceptive acts or practices prohibited.&nbsp;</span></p> <p><span class="cls0">No person shall engage in this state in any trade practice which is defined in this article as, or determined pursuant to this article to be, an unfair method of competition or an unfair or deceptive act or practice in the business of insurance.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 260, &sect; 1203. &nbsp;</span></p> <p><span class="cls0">&sect;36-1204. Unfair methods of competition and unfair or deceptive acts or practices defined.&nbsp;</span></p> <p><span class="cls0">The following are hereby defined as unfair methods of competition and unfair and deceptive acts or practices in the business of insurance:&nbsp;</span></p> <p><span class="cls0">1. Misrepresentations and false advertising of policy contracts. Making, issuing, circulating, or causing to be made, issued or circulated, any estimate, illustration, circular or statement misrepresenting the terms of any policy issued or to be issued or the benefits or advantages promised thereby or the dividends or share of the surplus to be received thereon, or making any false or misleading statement as to the dividends or share of surplus previously paid on similar policies, or making any misleading representation or any misrepresentation as to the financial condition of any insurer, or as to the legal reserve system upon which any life insurer operates, or using any name or title of any policy or class of policies misrepresenting the true nature thereof, or making any misrepresentation to any policyholder insured in any company for the purpose of inducing or tending to induce such policyholder to lapse, forfeit, or surrender his or her insurance.&nbsp;</span></p> <p><span class="cls0">2. False information and advertising generally. Making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public, in a newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter or poster, or over any radio or television station, or in any other way an advertisement, announcement or statement containing any assertion, representation or statement with respect to the business of insurance or with respect to any person in the conduct of his or her insurance business which is untrue, deceptive or misleading. No insurance company shall issue, or cause to be issued, any policy of insurance of any type or description upon life, or property, real or personal, whenever such policy of insurance is to be furnished or delivered to the purchaser or bailee of any property, real or personal, as an inducement to purchase or bail said property, real or personal, and no other person shall advertise, offer or give free insurance, insurance without cost or for less than the approved or customary rate, in connection with the sale or bailment of real or personal property, except as provided in Section 4101 of this title. No person that is not an insurer shall assume or use any name which deceptively infers or suggests that it is an insurer.&nbsp;</span></p> <p><span class="cls0">3. Defamation. Making, publishing, disseminating, or circulating, directly or indirectly, or aiding, abetting or encouraging the making, publishing, disseminating or circulating of any oral or written statement or any pamphlet, circular, article or literature which is false, or maliciously critical of or derogatory to the financial condition of an insurer, and which is calculated to injure any person engaged in the business of insurance.&nbsp;</span></p> <p><span class="cls0">4. Boycott, coercion and intimidation. Entering into any agreement to commit, or by any concerted action committing, any act of boycott, coercion or intimidation resulting in or tending to result in unreasonable restraint of, or monopoly in, the business of insurance.&nbsp;</span></p> <p><span class="cls0">5. False financial statements. Filing with any supervisory or other public official, or making, publishing, disseminating, circulating or delivering to any person, or placing before the public or causing directly or indirectly, to be made, published, disseminated, circulated, delivered to any person or placed before the public, any false statement of financial condition of an insurer with intent to deceive.&nbsp;</span></p> <p><span class="cls0">Making any false entry in any book, report or statement of any insurer with intent to deceive any agent or examiner lawfully appointed to examine into its condition or into any of its affairs, or any public official to whom such insurer is required by law to report, or who has authority by law to examine into its condition or into any of its affairs, or, with like intent, willfully omitting to make a true entry of any material fact pertaining to the business of such insurer in any book, report or statement of such insurer.&nbsp;</span></p> <p><span class="cls0">6. Stock operations and advisory board contracts. Issuing or delivering or permitting agents, officers, or employees to issue or deliver agency company stock or other capital stock, or benefit certificates or shares in any common-law corporation, or securities or any special or advisory board contracts or other contracts of any kind promising returns and profits as an inducement to insurance.&nbsp;</span></p> <p><span class="cls0">7. Unfair discrimination.&nbsp;</span></p> <p class="cls2"><span class="cls0">(a)&nbsp;&nbsp;Making or permitting any unfair discrimination between individuals of the same class and equal expectation of life in the rates charged for any contract of life insurance or of life annuity or in the dividends or other benefits payable thereon, or in any other of the terms and conditions of such contract.&nbsp;</span></p> <p class="cls2"><span class="cls0">(b)&nbsp;&nbsp;Making or permitting any unfair discrimination between individuals of the same class and of essentially the same hazard in the amount of premium, policy fees, or rates charged for any policy or contract of accident or health insurance or in the benefits payable thereunder, or in any of the terms or conditions of such contract, or in any other manner whatever.&nbsp;</span></p> <p class="cls2"><span class="cls0">(c)&nbsp;&nbsp;As to kinds of insurance other than life and accident and health, no person shall make or permit any unfair discrimination in favor of particular persons, or between insureds or subjects of insurance having substantially like insuring, risk, and exposure factors, or expense elements, in the terms or conditions of any insurance contract, or in the rate or amount of premium charged therefor. This subsection shall not apply as to any premium rate in effect pursuant to Article 9 of the Oklahoma Insurance Code.&nbsp;</span></p> <p><span class="cls0">8. Rebates.&nbsp;</span></p> <p class="cls2"><span class="cls0">(a)&nbsp;&nbsp;Except as otherwise expressly provided by law, knowingly permitting or offering to make or making any contract of insurance or agreement as to such contract other than as plainly expressed in the contract issued thereon; or paying or allowing, or giving or offering to pay, allow or give, directly or indirectly, as inducement to any contract of insurance, any rebate of premiums payable on the contract, or any special favor or advantage in the dividends or other benefits thereon, or any valuable consideration or inducement whatever not specified in the contract; except in accordance with an applicable rate filing, rating plan or rating system filed with and approved by the Insurance Commissioner; or giving or selling or purchasing or offering to give, sell, or purchase as inducement to such insurance, or in connection therewith, any stocks, bonds or other securities of any company, or any dividends or profits accrued thereon, or anything of value whatsoever not specified in the contract or receiving or accepting as inducement to contracts of insurance, any rebate of premium payable on the contract, or any special favor or advantage in the dividends or other benefit to accrue thereon, or any valuable consideration or inducement not specified in the contract.&nbsp;</span></p> <p class="cls2"><span class="cls0">(b)&nbsp;&nbsp;Nothing in subsection 7 or paragraph (a) of this subsection shall be construed as including within the definition of discrimination or rebates any of the following practices:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;In the case of any contract of life insurance or life annuity, paying bonuses to policyholders or otherwise abating their premiums in whole or in part out of surplus accumulated from nonparticipating insurance, provided, that any such bonuses or abatement of premiums shall be fair and equitable to policyholders and for the best interest of the company and its policyholders;&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;In the case of life or accident and health insurance policies issued on the industrial debit or weekly premium plan, making allowance to policyholders who have continuously for a specified period made premium payments directly to an office of the insurer in an amount which fairly represents the saving in collection expense;&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;Making a readjustment of the rate of premium for a policy based on the loss or expense experience thereunder, at the end of the first or any subsequent policy year of insurance thereunder, which may be made retroactive only for such policy year;&nbsp;</span></p> <p class="cls3"><span class="cls0">(4)&nbsp;&nbsp;In the case of life insurance companies, allowing its bona fide employees to receive a commission on the premiums paid by them on policies on their own lives;&nbsp;</span></p> <p class="cls3"><span class="cls0">(5)&nbsp;&nbsp;Issuing life or accident and health policies on a salary saving or payroll deduction plan at a reduced rate commensurate with the savings made by the use of such plan; and&nbsp;</span></p> <p class="cls3"><span class="cls0">(6)&nbsp;&nbsp;Paying commissions or other compensation to duly licensed agents or brokers, or allowing or returning to participating policyholders, members or subscribers, dividends, savings or unabsorbed premium deposits.&nbsp;</span></p> <p class="cls2"><span class="cls0">(c)&nbsp;&nbsp;As used in this section, the word "insurance" includes suretyship and the word "policy" includes bond.&nbsp;</span></p> <p><span class="cls0">9. Coercion prohibited. Requiring as a condition precedent to the purchase of, or the lending of money upon the security of, real or personal property, that any insurance covering such property, or liability arising from the ownership, maintenance or use thereof, be procured by or on behalf of the vendee or by the borrower in connection with such purchase or loan through any particular person or agent or in any particular insurer, or requiring the payment of a reasonable fee as a condition precedent to the replacement of insurance coverage on mortgaged property at the anniversary date of the policy; provided, however, that this provision shall not prevent the exercise by any such vendor or lender of the right to approve or disapprove any insurer selected to underwrite the insurance; but any disapproval of any insurer shall be on reasonable grounds.&nbsp;</span></p> <p><span class="cls0">10. Inducements. No insurer, agent, broker, solicitor, or other person shall, as an inducement to insurance or in connection with any insurance transaction, provide in any policy for or offer, sell, buy, or offer or promise to buy, sell, give, promise, or allow to the insured or prospective insured or to any other person in his or her behalf in any manner whatsoever:&nbsp;</span></p> <p class="cls2"><span class="cls0">(a)&nbsp;&nbsp;Any employment.&nbsp;</span></p> <p class="cls2"><span class="cls0">(b)&nbsp;&nbsp;Any shares of stock or other securities issued or at any time to be issued or any interest therein or rights thereto.&nbsp;</span></p> <p class="cls2"><span class="cls0">(c)&nbsp;&nbsp;Any advisory board contract, or any similar contract, agreement or understanding, offering, providing for, or promising any special profits.&nbsp;</span></p> <p class="cls2"><span class="cls0">(d)&nbsp;&nbsp;Any prizes, goods, wares, merchandise, or tangible property of an aggregate value in excess of One Hundred Dollars ($100.00).&nbsp;</span></p> <p class="cls2"><span class="cls0">(e)&nbsp;&nbsp;Any special favor, advantage or other benefit in the payment, method of payment or credit for payment of the premium through the use of credit cards, credit card facilities, credit card lists, or wholesale or retail credit accounts of another person. The provisions of this paragraph shall not apply to individual policies insuring against loss resulting from bodily injury or death by accident as defined by Article 44 of the Oklahoma Insurance Code.&nbsp;</span></p> <p><span class="cls0">11. Premature disposal of premium notes prohibited. No insurer or agent thereof shall hypothecate, sell, or dispose of a promissory note received in payment of any part of a premium on a policy of insurance applied for prior to the delivery of the policy.&nbsp;</span></p> <p><span class="cls0">12. Fraudulent statement in application; penalty. Any insurance agent, examining physician, or other person who knowingly or willfully makes a false or fraudulent statement or representation in or relative to an application for insurance, or who makes any such statement to obtain a fee, commission, money, or benefit shall be guilty of a misdemeanor.&nbsp;</span></p> <p><span class="cls0">13. Deceptive use of financial institution's name in notification or solicitation. Verbally or by any other means notifying or soliciting any person in a manner that:&nbsp;</span></p> <p class="cls2"><span class="cls0">(a)&nbsp;&nbsp;mentions the name of an unrelated and unaffiliated financial institution,&nbsp;</span></p> <p class="cls2"><span class="cls0">(b)&nbsp;&nbsp;mentions an insurance product or the possible lack of insurance coverage,&nbsp;</span></p> <p class="cls2"><span class="cls0">(c)&nbsp;&nbsp;does not mention the actual or trade name of the insurance agency or company on whose behalf the notification or solicitation is provided, and&nbsp;</span></p> <p class="cls2"><span class="cls0">(d)&nbsp;&nbsp;thereby creates an impression or implication, including by omission, that the financial institution or a financial-institution-authorized entity is or may be the one making the notification or solicitation.&nbsp;</span></p> <p><span class="cls0">Nothing in this paragraph shall be interpreted to prohibit the reference to or use of the name of a financial institution made pursuant to a contractual agreement between the insurer and the financial institution.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, c. 261, &sect; 1204, operative July 1, 1957. Amended by Laws 1965, c. 261, &sect; 2, emerg. eff. June 22, 1965; Laws 1980, c. 196, &sect; 1, eff. Oct. 1, 1980; Laws 1987, c. 210, &sect; 34, eff. July 1, 1987; Laws 2005, c. 129, &sect; 10, eff. Nov. 1, 2005; Laws 2006, c. 180, &sect; 1, eff. Nov. 1, 2006; Laws 2007, c. 1, &sect; 20, emerg. eff. Feb. 22, 2007; Laws 2012, c. 148, &sect; 1, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2006, c. 264, &sect; 43 repealed by Laws 2007, c. 1, &sect; 21, emerg. eff. Feb. 22, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1204.1. Availability of loss runs and claims histories.&nbsp;</span></p> <p><span class="cls0">Property and casualty insurers and advisory board or advisory organizations shall make loss runs or claims history available to current and former policyholders within thirty (30) days upon a written request by the policyholder.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2007, c. 125, &sect; 8, eff. July 1, 2007. Amended by Laws 2010, c. 222, &sect; 23, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;361205. Power of commissioner.&nbsp;</span></p> <p><span class="cls0">The Commissioner shall have power to examine and investigate into the affairs of every person engaged in the business of insurance in this state in order to determine whether such person has been or is engaged in any unfair method of competition or in any unfair or deceptive act or practice prohibited by Section 1203 of this article.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 263, &sect; 1205. &nbsp;</span></p> <p><span class="cls0">&sect;36-1206. Statement of charges and notice of hearing - Opportunity to be heard.&nbsp;</span></p> <p><span class="cls0">A. Whenever the Insurance Commissioner shall have reason to believe that any person has been engaged or is engaging in this state in any unfair method of competition or any unfair or deceptive act or practice defined in Section 1204 of this title, and that a proceeding by the Commissioner in respect thereto would be to the interest of the public, the Commissioner shall issue and serve upon the person a statement of the charges in that respect and a notice in accordance with the Administrative Procedures Act.&nbsp;</span></p> <p><span class="cls0">B. At the time and place fixed for a hearing, the person shall have an opportunity to be heard and to show cause why an order should not be made by the Commissioner requiring the person to cease and desist from the acts, methods or practices so complained of. Upon good cause shown, the Commissioner shall permit any person to intervene, appear and be heard at the hearing by counsel or in person.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 263, &sect; 1206. Amended by Laws 1997, c. 418, &sect; 43, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361207. Cease and desist orders and modifications thereof.&nbsp;</span></p> <p><span class="cls0">A. If, after a hearing or waiver of the right to a hearing, the Insurance Commissioner shall determine that the method of competition or the act or practice in question is defined in Section 1204 of this title and that the person complained of has engaged in a method of competition, act or practice in violation of this article, the Commissioner shall reduce these findings to writing and shall issue and cause to be served upon the person charged with the violation an order requiring the person to cease and desist from engaging in such method of competition, act or practice.&nbsp;</span></p> <p><span class="cls0">B. Until the expiration of the time allowed under subsection A of Section 1208 of this title for filing a petition for review, if no such petition has been duly filed within such time, or if a petition for review has been filed within such time, then until the transcript of the record in the proceeding has been filed in the court, as hereinafter provided, the Commissioner may at any time, upon such notice and in such manner as the Commissioner shall deem proper, modify or set aside in whole or in part any order issued by the Commissioner under this section.&nbsp;</span></p> <p><span class="cls0">C. After the expiration of the time allowed for filing a petition for review, if no petition has been duly filed within such time, the Commissioner may at any time, after notice and opportunity for hearing, reopen and later, modify or set aside, in whole or in part, any order issued by the Commissioner under this section whenever in the Commissioner's opinion conditions of fact or of law has so changed as to require such action or if the public interest shall so require.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 264, &sect; 1207. Amended by Laws 1957, p. 264, &sect; 1207; Laws 1997, c. 418, &sect; 44, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361208. Judicial review of cease and desist orders.&nbsp;</span></p> <p><span class="cls0">A. Any person required by an order of the Insurance Commissioner under Section 1207 of this title to cease and desist from engaging in any unfair method of competition or any unfair or deceptive act or practice defined in Section 1204 of this title may obtain a review of such order by filing in the district court of Oklahoma County, or the county in which the order was served, within thirty (30) days from the date of service of such order, a written petition praying that the order of the Commissioner be set aside. A copy of the petition shall be served upon the Commissioner, and thereupon the Commissioner shall certify and file in such court a transcript of the entire record in the proceeding, including all the evidence taken and the report and order of the Commissioner. Upon filing the petition and transcript, the court shall have jurisdiction of the proceeding and of the question determined therein, shall determine whether the filing of the petition shall operate as a stay of the order of the Commissioner, and shall have power to make and enter upon the pleadings, evidence, and proceedings set forth in the transcript a decree modifying, affirming or reversing the order of the Commissioner, in whole or in part. The findings of the Commissioner as to the facts, if supported by the evidence, shall be conclusive.&nbsp;</span></p> <p><span class="cls0">B. To the extent that the order of the Commissioner is affirmed, the court shall thereupon issue its own order commanding obedience to the terms of the order of the Commissioner. If either party shall apply to the court for leave to adduce additional evidence, and shall show to the satisfaction of the court that additional evidence is material and that there were reasonable grounds for the failure to adduce such evidence in the proceeding before the Commissioner, the court may order additional evidence be taken before the Commissioner, and to be adduced upon the hearing in such manner and upon such terms and conditions as to the court may seem proper. The Commissioner may modify findings of fact, or make new findings by reason of the additional evidence so taken, and shall file such modified or new findings which, if supported by the evidence, shall be conclusive, and his recommendation, if any, for the modification or setting aside of his original order, with the return of such additional evidence. Appeal may be taken from the district court as provided in other civil cases.&nbsp;</span></p> <p><span class="cls0">C. A cease and desist order issued by the Commissioner under Section 1207 of this title shall become final:&nbsp;</span></p> <p><span class="cls0">1. Upon the expiration of the time allowed for filing a petition for review if no such petition has been duly filed within such time; except that the Commissioner may thereafter modify or set aside an order to the extent provided in subsection B of Section 1207 of this title; or&nbsp;</span></p> <p><span class="cls0">2. Upon the final decision of the court if the court directs that the order of the Commissioner be affirmed or the petition for review dismissed.&nbsp;</span></p> <p><span class="cls0">D. No order of the Commissioner under this article or order of a court to enforce the same shall in any way relieve or absolve any person affected by such order from any liability under any other laws of this state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 265, &sect; 1208. Amended by Laws 1997, c. 418, &sect; 45, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361209. Procedure as to unfair methods of competition and unfair or deceptive acts or practices which are not defined.&nbsp;</span></p> <p><span class="cls0">A. Whenever the Insurance Commissioner shall have reason to believe that any person engaged in the business of insurance is engaging in this state in any method of competition or in any act or practice in the conduct of such business which is not defined in Section 1204 of this title, that the method of competition is unfair or that the act or practice is unfair or deceptive and that an administrative proceeding in respect thereto would be to the interest of the public, the Commissioner may issue and serve such person a statement of the charges in that respect and a notice in accordance with the Administrative Procedures Act. The Commissioner shall, after a hearing or waiver of the right to a hearing, make a report in writing stating findings as to the facts and serve a copy thereof upon such person.&nbsp;</span></p> <p><span class="cls0">B. If such report charges a violation of this article and if such method of competition, act or practice has not been discontinued, the Commissioner may cause a petition to be filed in the district court of Oklahoma County or the district court of this state within the district wherein the person resides or has his or her principal place of business, to enjoin and restrain such person from engaging in such method, act or practice. The Commissioner may request the Attorney General to appear in the name of the state by relation of the Commissioner. The court shall have jurisdiction of the proceeding and shall have power to make and enter appropriate orders in connection therewith and to issue such writs as are ancillary to its jurisdiction or are necessary in its judgment to prevent injury to the public pendente lite.&nbsp;</span></p> <p><span class="cls0">C. A transcript of the proceedings before the Commissioner including all evidence taken and the report and findings shall be filed with such petition. If either party shall apply to the court for leave to adduce additional evidence and shall show, to the satisfaction of the court, that additional evidence is material and there were reasonable grounds for the failure to adduce evidence in the proceeding before the Commissioner, the court may order additional evidence to be taken before the Commissioner and to be adduced upon the hearing in such manner and upon such terms and conditions as to the court may seem proper. The Commissioner may modify findings of fact or make new findings by reason of the additional evidence so taken, and he shall file such modified or new findings with the return of such additional evidence.&nbsp;</span></p> <p><span class="cls0">&nbsp;&nbsp;D. If the court finds that the method of competition complained of is unfair or that the act or practice complained of is unfair or deceptive, that the proceeding by the Commissioner with respect thereto is to the interest of the public and that the findings of the Commissioner are supported by the weight of the evidence, it shall issue its order enjoining and restraining the continuance of such method of competition, act or practice.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 265, &sect; 1209. Amended by Laws 1997, c. 418, &sect; 46, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361210. Judicial review by intervenor.&nbsp;</span></p> <p><span class="cls0">If the final order of the Insurance Commissioner does not charge a violation of this article, then any intervenor in the proceedings may, within thirty (30) days after the service of such order, cause an action for judicial review to be filed in the district court of Oklahoma County for a review of such order. Upon such review, the court shall have authority to issue appropriate orders and decrees in connection therewith, including, if the court finds that it is to the interest of the public, orders enjoining and restraining the continuance of any method of competition, act or practice which it finds, notwithstanding such order of the Commissioner, constitutes a violation of this article.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 266, &sect; 1210. Amended by Laws 1997, c. 418, &sect; 47, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1211. Civil penalty.&nbsp;</span></p> <p><span class="cls0">Any person who violates a cease and desist order of the Insurance Commissioner issued and served pursuant to the provisions of Section 1207 of this title, after it has become final, and while such order is in effect, shall, upon proof thereof to the satisfaction of the court, forfeit and pay to the State of Oklahoma a civil penalty of not less than One Hundred Dollars ($100.00), nor more than One Thousand Dollars ($1,000.00) for each violation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 266, &sect; 1211. Amended by Laws 1983, c. 68, &sect; 10, eff. Nov. 1, 1983; Laws 1997, c. 418, &sect; 48, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361212. Provisions of act additional.&nbsp;</span></p> <p><span class="cls0">The powers vested in the Commissioner by this article shall be additional to any other powers to enforce penalties, fines or forfeitures authorized by law with respect to the methods, acts and practices hereby declared to be unfair or deceptive.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1957, p. 266, &sect; 1212. &nbsp;</span></p> <p><span class="cls0">&sect;361213. Immunity from prosecution.&nbsp;</span></p> <p><span class="cls0">If any person shall ask to be excused from attending and testifying or from producing any books, papers, records, correspondence or other documents at any hearing on the ground that the testimony or evidence required of the person may tend to incriminate the person or subject the person to a penalty or forfeiture, and shall notwithstanding be directed to give such testimony or produce such evidence, the person must nonetheless comply with such direction, but shall not thereafter be prosecuted or subjected to any criminal penalty of forfeiture for or on account of any evidence which the person may testify or produce pursuant thereto. No testimony so given or evidence produced shall be received against the person upon any criminal action, investigation or proceeding; provided, however, individuals so testifying shall not be exempt from prosecution or punishment for any perjury committed by them while so testifying and the testimony or evidence so given or produced shall be admissible against them upon any criminal action, investigation or proceeding concerning such perjury, and such individuals shall not be exempt from the refusal, revocation or suspension of any license, permission or authority conferred, or to be conferred, pursuant to the insurance law of this state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 266, &sect; 1213. Amended by Laws 1997, c. 418, &sect; 49, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361214. Fair disclosure Protection against misleading sales methods.&nbsp;</span></p> <p><span class="cls0">The purpose of this act is to assure fair disclosure of relevant facts in the sale of life insurance and annuity contracts. This act is also designed to protect citizens of the State of Oklahoma as purchasers and prospective purchasers of life insurance policies or annuity contracts against the use of sales methods which are misleading because of:&nbsp;</span></p> <p><span class="cls0">1. The omission of facts fairly describing the subject matter as a life insurance policy or annuity contract and the benefits obtainable thereunder;&nbsp;</span></p> <p><span class="cls0">2. An undue emphasis upon facts which, even though correct, are not relevant to the sale of life insurance or annuities; or&nbsp;</span></p> <p><span class="cls0">3. An undue emphasis upon features which are of incidental or secondary importance to the life insurance aspects of a policy.&nbsp;</span></p> <p><span class="cls0">This act is deemed necessary for the effectuation of Section 1201 et seq., Title 36, Oklahoma Statutes, known as the Unfair Practices and Frauds Act; Section 1401 et seq., Title 36, Oklahoma Statutes; and Sections 2741 and 2742, Title 36, Oklahoma Statutes; and shall be construed as supplemental and cumulative to existing laws.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1972, c. 223, &sect; 1, operative Jan. 15, 1974. &nbsp;</span></p> <p><span class="cls0">&sect;361215. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in this act, the following words, terms and phrases shall have the respective meanings hereinafter set forth, unless the context shall otherwise require:&nbsp;</span></p> <p><span class="cls0">1. A "coupon policy" is any policy or contract of life insurance, other than annuity, which contains, in addition to basic life insurance benefits, annual endowment benefits evidenced in the policy contract by coupons which mature as annual endowment benefits. For the purposes of this act, policies containing annual endowment benefits evidenced by coupons, passbooks or other devices generally identified with savings, banking or investment institutions shall be considered to be coupon policies;&nbsp;</span></p> <p><span class="cls0">2. A "profitsharing policy" is that form of life insurance policy or annuity contract which contains provisions representing or tending to create the understanding that the policyholder will be eligible to participate in any future distribution of general corporate profits, with special advantage not available to persons holding other types of policies issued by the insurer to individuals of the same class and equal expectation of life; and&nbsp;</span></p> <p><span class="cls0">3. A "charter policy" or "founders policy" is that form of life insurance policy or annuity contract, usually issued by a newly organized insurer, which is sold on the basis that its availability will be limited to a specific predetermined number of units of a fixed dollar amount and which generally provides that the policyholder shall participate in the earnings resulting from either the participating policies or the nonparticipating policies sold by the insurer, or both.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1972, c. 223, &sect; 2, operative Jan. 15, 1974. &nbsp;</span></p> <p><span class="cls0">&sect;361216. Prohibitions and regulations concerning use of certain types of policy forms, policy provisions and annuity contracts.&nbsp;</span></p> <p><span class="cls0">In accordance with the purpose expressed in Section 1 of this act, the use of certain types of policy forms, policy provisions and annuity contracts shall be subject to the following prohibitions and regulations:&nbsp;</span></p> <p><span class="cls0">1. No life insurance policy or annuity contract containing a series of guaranteed annual endowment benefits evidenced by coupons, passbooks or similar devices generally identified with investment or banking operations shall be approved for use, and no such policy or contract heretofore approved shall be issued or delivered in this state after January 15, 1974;&nbsp;</span></p> <p><span class="cls0">2. No life insurance policy or annuity contract containing a series of guaranteed annual endowment benefits shall be approved for use and no such policy or contract heretofore approved shall be issued or delivered in this state after January 15, 1974, unless the following requirements are satisfied:&nbsp;</span></p> <p><span class="cls0">a. the gross premium for the guaranteed annual endowment benefit shall be shown conspicuously and separately in the policy, distinct from the gross premium for the life insurance benefits and, unless the gross premium is so prominently and separately shown on the schedule of benefits and premiums page in the policy, the language shall be sub stantially in the following form: "The premium shown includes an additional (annual, semiannual, quarterly, monthly, etc.) premium of $_____ for endowment benefits,"&nbsp;</span></p> <p><span class="cls0">b. the insured shall be entitled to withdraw the guaranteed annual endowment benefits not less frequently than at the end of each policy year. The number of oneyear guaranteed endowment benefits shall equal the number of annual premiums for such benefits unless the insurance contract clearly and distinctly provides otherwise,&nbsp;</span></p> <p><span class="cls0">c. payment of any guaranteed annual endowment benefits shall not be made contingent on the payment of premiums falling due on or after the time the guaranteed annual endowment benefit has matured,&nbsp;</span></p> <p><span class="cls0">d. the separately stated gross premium for the series of guaranteed annual endowment benefits shall be based on reasonable assumptions, consistent with the basic policy form as to interest, mortality and expense,&nbsp;</span></p> <p><span class="cls0">e. the guaranteed annual endowment benefit shall be expressed in dollars, both in the policy and in any sales or advertising material relating thereto, and not as a percentage of any premium or benefit,&nbsp;</span></p> <p><span class="cls0">f. no guaranteed annual endowment benefit shall be described, either in the policy or in any sales or advertising material, as anything other than a guaranteed benefit for which a premium is being paid by the policyholder, and&nbsp;</span></p> <p><span class="cls0">g. at the time the policy form is filed with the Insurance Department for approval, said policy form shall be accompanied by all sales, advertising or other material which the insurer proposes to use in connection with the sale of such policy; such sales, advertising or other material shall be approved by the State Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">Nothing in this subsection shall apply to any policy in which the amount of any endowment or periodic benefit or benefits payable during any policy year is greater than the total annual premium for such year;&nbsp;</span></p> <p><span class="cls0">3. No coupon policy shall be approved or issued in this state after the effective date of this act, nor shall any coupon policy heretofore approved be issued or delivered in this state after January 15, 1974;&nbsp;</span></p> <p><span class="cls0">4. No profitsharing policy shall be approved for use in this state after the effective date of this act, nor shall any profit sharing policy heretofore approved be issued or delivered in this state after January 15, 1974. Nothing contained in this section shall apply to variable annuity contracts to the extent that such are permitted under the laws of this state.&nbsp;</span></p> <p><span class="cls0">This subsection shall not be construed to restrict or prohibit the sale in this state of any participating life insurance policy where the dividend or abatement of premium is derived solely from the profits of that class of participating business;&nbsp;</span></p> <p><span class="cls0">5. No charter, founders or coupon policy or policy with a name of similar connotation shall be approved for use in this state after the effective date of this act and no charter, founders or coupon policy or policy with a name of similar connotation heretofore approved shall be issued or delivered in this state after January 15, 1974; and&nbsp;</span></p> <p><span class="cls0">6. No annual endowment shall be described as being a guaranteed dividend, nor as earnings on the premium investment. Nothing in this section shall be construed to prohibit a representation that a holder of a participating life insurance policy or annuity contract will participate in the share of the divisible surplus, if any, apportioned to the policy or contract by the insurer.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1972, c. 223, &sect; 3, operative Jan. 15, 1974. &nbsp;</span></p> <p><span class="cls0">&sect;361217. Prohibitions and regulations relating to insurers, agents of insurers, representatives of insurers and brokers Group insurance and group annuity contracts exempt.&nbsp;</span></p> <p><span class="cls0">In accordance with the purpose expressed in Section 1 of this act, insurers, agents of insurers, representatives of insurers and brokers shall be subject to the following prohibitions and regulations:&nbsp;</span></p> <p><span class="cls0">1. No insurer, agent of an insurer or representative of an insurer shall deliver within this state, or issue for delivery within this state, any policy of life insurance or annuity contract which uses as its name or title a phrase which does not include the words, "Life Insurance" or "Annuity Contract" unless such phrase is accompanied by other language elsewhere in the policy or contract which indicates that it is a life insurance policy or annuity contract;&nbsp;</span></p> <p><span class="cls0">2. The use of the terms "Investment," "Investment Plan," "Expansion Plan," "Profit," "Profitsharing" and similar terms in connection with a policy of life insurance or an annuity contract, in a context or under such circumstances or conditions as to have the capacity or tendency to mislead a purchaser or prospective purchaser of such policy or contract to believe that he will receive, or that it is possible that he will receive, something other than a life insurance policy or annuity contract or some benefit not provided in the policy or contract or some benefit not available to other persons of the same class and equal expectation of life, is unlawful and is prohibited;&nbsp;</span></p> <p><span class="cls0">3. No insurer, agent or broker shall within this state:&nbsp;</span></p> <p><span class="cls0">a. make any statement or reference relating to the growth of the life insurance industry in connection with any solicitation of an application for life insurance or annuity contract in a context which could reasonably be understood to interest a prospect in the purchase of shares of stock in an insurer rather than in the purchase of a life insurance policy or annuity contract,&nbsp;</span></p> <p><span class="cls0">b. make any statement which reasonably gives rise to the inference that an insured or a prospective insured, by virtue of purchasing a policy of life insurance or an annuity contract, will enjoy a status common to a stockholder or will acquire a stock ownership interest in the insurer; provided, however, that nothing in this paragraph is intended to prohibit the practice of pointing out those aspects in which the status of a policyholder in a mutual life insurer is similar to that of a stockholder in a stock life insurer,&nbsp;</span></p> <p><span class="cls0">c. make any reference to or statement concerning an insurer's "Investment Department," "Insured Investment Department" or similar terminology, in such a manner as to imply that the policy was sold or issued by the investment department of the life insurer,&nbsp;</span></p> <p><span class="cls0">d. make any statement or reference which would reasonably tend to imply that, by purchasing a policy, the purchaser or prospective purchaser will become a member of a limited group of persons who may receive special advantages or favored treatment in the payment of dividends, unless such benefits are specifically provided in the insurance contract. This paragraph shall not apply to policies under which insured persons of one class of risk may receive dividends at a higher rate than persons of another class of risk,&nbsp;</span></p> <p><span class="cls0">e. state or imply that a particular kind of policy is available for only a limited time or that only a limited number of a particular kind of policy will be offered for sale or that only a limited number of persons, or a limited class of persons, will be eligible to buy a particular kind of policy, unless such limitation is specifically provided in the insurance contract,&nbsp;</span></p> <p><span class="cls0">f. state or imply that policyholders who are said to act as "centers of influence" or as an advisory board for an insurer will share, because of so acting, in the insurer's surplus earnings in some manner not available to other policyholders who are otherwise in the same class,&nbsp;</span></p> <p><span class="cls0">g. describe or refer to premium payments in language which states that the payment is a "deposit" unless:&nbsp;</span></p> <p><span class="cls0">(1) the payment sets up a debtorcreditor relationship between the life insurance company and the policyholder and a showing is made as to when and how the deposit may be withdrawn,&nbsp;</span></p> <p><span class="cls0">(2) the term is used in conjunction with the word "premium" in such a manner as to indicate clearly the true character of the payment, or&nbsp;</span></p> <p><span class="cls0">(3) the term is used in connection with pension trust or deposit administration plans,&nbsp;</span></p> <p><span class="cls0">h. use the words "dividends," "cash dividends," "surplus" or similar phrases in such a manner as to state or imply that the payment of dividends is guaranteed or certain to occur,&nbsp;</span></p> <p><span class="cls0">i. state or imply that a purchaser of a policy will share in a stated percentage or portion of the earnings of the insurer. Nothing in this paragraph is intended to prohibit a representation that a holder of a participating life insurance policy or annuity contract will participate in the share of the divisible surplus, if any, apportioned to the policy or contract by the insurer,&nbsp;</span></p> <p><span class="cls0">j. make any statement or implication that dividends under a participating policy will be sufficient at any time to assure the receipt of benefits, such as a paidup policy, without the further payment of premiums, unless the statement is accompanied by an adequate explanation as to what benefits or coverage would be provided at such time and the conditions under which this would occur,&nbsp;</span></p> <p><span class="cls0">k. state that the insured is guaranteed certain benefits if the policy is allowed to lapse without making an adequate explanation of the nonforfeiture benefits,&nbsp;</span></p> <p><span class="cls0">l. describe a life insurance policy or annuity contract or premium payments therefor in terms of "units of participation" unless accompanied by other language clearly indicating the reference to a life insurance policy or annuity contract or to premium payments, as the case may be,&nbsp;</span></p> <p><span class="cls0">m. include in sales kits and prepared sales presentations proposed answers to a prospect's questions as to whether life insurance policies or annuity contracts are being sold, which are designed to avoid a clear and unequivocal statement that life insurance or annuities are the subject matter of the solicitation,&nbsp;</span></p> <p><span class="cls0">n. display in any manner to a prospective policyholder any material which includes illustrations, using dollar amounts, in connection with the proposed sale of a life insurance or annuity contract unless the printed material clearly identifies that the subject, to which the dollar amounts pertain, has an economic relationship to guaranteed values and dividends of the policy,&nbsp;</span></p> <p><span class="cls0">o. make any general statement that an insurer makes a profit as a result of policy lapses or surrenders,&nbsp;</span></p> <p><span class="cls0">p. make comparisons to the past experience of other life insurers as a means of projecting possible experience of the soliciting insurer when those comparisons are designed to enhance the characteristics of the policy being sold by confining the comparisons to insurers having favorable experience with that type of policy without a fair disclosure of other insurers which have had unfavorable experience with such type of policy,&nbsp;</span></p> <p><span class="cls0">q. state that a policy contains certain features which are not found in other life insurance policies or annuity contracts, unless that be true,&nbsp;</span></p> <p><span class="cls0">r. represent an option to purchase insurance in the future in such a manner that the policyholder might reasonably infer that he is purchasing term insurance or some other form of life insurance that would result in a payment to the beneficiary in the event of the death of the policyholder, or&nbsp;</span></p> <p><span class="cls0">s. make any reference to a policy of life insurance or an annuity contract in such a manner as to misrepresent the true nature of the policy contract;&nbsp;</span></p> <p><span class="cls0">4. No insurer, agent for an insurer or representative for an insurer shall, as a competitive or "twisting" device, inform any policyholder or prospective policyholder that any other insurer is required to change a policy form or related material to comply with the provisions of this act; and&nbsp;</span></p> <p><span class="cls0">5. This section shall not apply to group insurance policies nor to group annuity contracts.&nbsp;</span></p> <p class="cls1"><span class="cls0">Laws 1972, c. 223, &sect; 4, operative Jan. 15, 1974. &nbsp;</span></p> <p><span class="cls0">&sect;36-1219. Clean claims - Reimbursement - Notice of defective claims - Interest on overdue payments - Attorney's fees.&nbsp;</span></p> <p><span class="cls0">A. In the administration, servicing, or processing of any accident and health insurance policy, every insurer shall reimburse all clean claims of an insured, an assignee of the insured, or a health care provider within forty-five (45) calendar days after receipt of the claim by the insurer.&nbsp;</span></p> <p><span class="cls0">B. As used in this section:&nbsp;</span></p> <p><span class="cls0">1. "Accident and health insurance policy" or "policy" means any policy, certificate, contract, agreement or other instrument that provides accident and health insurance, as defined in Section 703 of this title, to any person in this state, and any subscriber certificate or any evidence of coverage issued by a health maintenance organization to any person in this state;&nbsp;</span></p> <p><span class="cls0">2. "Clean claim" means a claim that has no defect or impropriety, including a lack of any required substantiating documentation, or particular circumstance requiring special treatment that impedes prompt payment; and&nbsp;</span></p> <p><span class="cls0">3. "Insurer" means any entity that provides an accident and health insurance policy in this state, including, but not limited to, a licensed insurance company, a not-for-profit hospital service and medical indemnity corporation, a health maintenance organization, a fraternal benefit society, a multiple employer welfare arrangement, or any other entity subject to regulation by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">C. If a claim or any portion of a claim is determined to have defects or improprieties, including a lack of any required substantiating documentation, or particular circumstance requiring special treatment, the insured, enrollee or subscriber, assignee of the insured, enrollee or subscriber, and health care provider shall be notified in writing within thirty (30) calendar days after receipt of the claim by the insurer. The written notice shall specify the portion of the claim that is causing a delay in processing and explain any additional information or corrections needed. Failure of an insurer to provide the insured, enrollee or subscriber, assignee of the insured, enrollee or subscriber, and health care provider with the notice shall constitute prima facie evidence that the claim will be paid in accordance with the terms of the policy. Provided, if a claim is not submitted into the system due to a failure to meet basic Electronic Data Interchange (EDI) and/or Health Insurance Portability and Accountability Act (HIPAA) edits, electronic notification of the failure to the submitter shall be deemed compliance with this subsection. Provided further, health maintenance organizations shall not be required to notify the insured, enrollee or subscriber, or assignee of the insured, enrollee or subscriber of any claim defect or impropriety.&nbsp;</span></p> <p><span class="cls0">D. Upon receipt of the additional information or corrections which led to the claim&rsquo;s being delayed and a determination that the information is accurate, an insurer shall either pay or deny the claim or a portion of the claim within forty-five (45) calendar days.&nbsp;</span></p> <p><span class="cls0">E. Payment shall be considered made on:&nbsp;</span></p> <p><span class="cls0">1. The date a draft or other valid instrument which is equivalent to the amount of the payment is placed in the United States mail in a properly addressed, postpaid envelope; or&nbsp;</span></p> <p><span class="cls0">2. If not so posted, the date of delivery.&nbsp;</span></p> <p><span class="cls0">F. An overdue payment shall bear simple interest at the rate of ten percent (10%) per year.&nbsp;</span></p> <p><span class="cls0">G. In the event litigation should ensue based upon such a claim, the prevailing party shall be entitled to recover a reasonable attorney fee to be set by the court and taxed as costs against the party or parties who do not prevail.&nbsp;</span></p> <p><span class="cls0">H. The Insurance Commissioner shall develop a standardized prompt pay form for use by providers in reporting violations of prompt pay requirements. The form shall include a requirement that documentation of the reason for the delay in payment or documentation of proof of payment must be provided within ten (10) days of the filing of the form. The Commissioner shall provide the form to health maintenance organizations and providers.&nbsp;</span></p> <p><span class="cls0">I. The provisions of this section shall not apply to the Oklahoma Life and Health Insurance Guaranty Association or to the Oklahoma Property and Casualty Insurance Guaranty Association.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1975, c. 301, &sect; 1, eff. Oct. 1, 1975. Amended by Laws 1986, c. 251, &sect; 12, eff. Nov. 1, 1986; Laws 1987, c. 175, &sect; 8, eff. Nov. 1, 1987; Laws 1992, c. 74, &sect; 1, eff. Sept. 1, 1992; Laws 1997, c. 156, &sect; 1, eff. Nov. 1, 1997; Laws 1997, c. 418, &sect; 50, eff. Nov. 1, 1997; Laws 2001, c. 65, &sect; 1, eff. Nov. 1, 2001; Laws 2003, c. 197, &sect; 52, eff. Nov. 1, 2003; Laws 2007, c. 338, &sect; 2, eff. July 1, 2007.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1219.1. Short title.&nbsp;</span></p> <p><span class="cls0">Sections 4 through 6 of this act shall be known and may be cited as the &ldquo;Health Care Fraud Prevention Act&rdquo;.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2000, c. 353, &sect; 4, eff. Nov. 1, 2000.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1219.2. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in the Health Care Fraud Prevention Act:&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Accident and health insurance policy&rdquo; means any policy, certificate, contract, agreement or other instrument that provides accident and health insurance, as defined in Section 703 of this title, to any person in this state;&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Health care provider&rdquo; means a physician, hospital, ambulatory surgical center, pharmacy, pharmacist, laboratory, or any other state-licensed or state-recognized provider of health care services;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Insured&rdquo; means any person entitled to reimbursement for expenses of health care services and procedures under an accident and health insurance policy issued by an insurer;&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Insurer&rdquo; means any entity that provides an accident and health insurance policy in this state, including but not limited to a licensed insurance company, a not-for-profit hospital service and medical indemnity corporation, a fraternal benefit society, a multiple employer welfare arrangement, or any other entity subject to regulation by the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">5. &rdquo;Perferred provider organization&rdquo; means any entity defined as a &ldquo;preferred provider organization (PPO)&rdquo; in Section 6054 of this title; and&nbsp;</span></p> <p><span class="cls0">6. &ldquo;Third-party administrator&rdquo; means any person defined as an &ldquo;administrator&rdquo; in Section 1442 of this title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2000, c. 353, &sect; 5, eff. Nov. 1, 2000.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1219.3. Discounted reimbursement and disclosure of reimbursement terms prohibited.&nbsp;</span></p> <p><span class="cls0">A. An insurer or third-party administrator shall not reimburse a health care provider on a discounted fee basis for covered services that are provided to an insured unless:&nbsp;</span></p> <p><span class="cls0">1. The insurer or third-party administrator has contracted with either:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the health care provider, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;a preferred provider organization which has contracted with the health care provider;&nbsp;</span></p> <p><span class="cls0">2. The health care provider has agreed to provide health care services under the terms of the contract; and&nbsp;</span></p> <p><span class="cls0">3. The insurer or third-party administrator has agreed to provide coverage for those health care services under an accident and health insurance policy.&nbsp;</span></p> <p><span class="cls0">B. A party to a preferred provider contract, including a contract with a preferred provider organization, may not sell, lease, or otherwise transfer information regarding the payment or reimbursement terms of the contract without the express authority and prior adequate notification of the other contracting parties.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2000, c. 353, &sect; 6, eff. Nov. 1, 2000.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1219.4. Definitions - Requirements for discount medical plan organizations - Penalties.&nbsp;</span></p> <p><span class="cls0">A. As used in this section:&nbsp;</span></p> <p><span class="cls0">1. "Direct contract" means a contractual arrangement tying the ultimate seller purporting to offer discounts through the discount card to the health care provider, which expressly states the intent of this agreement to be used for the purpose of offering discounts on health-related purchases to uninsured or noncovered persons;&nbsp;</span></p> <p><span class="cls0">2. "Discount card" means a card or any other purchasing mechanism or device, which is not insurance, that purports to offer discounts or access to discounts in health-related purchases from health care providers;&nbsp;</span></p> <p><span class="cls0">3. "Discount medical plan" means a business arrangement or contract in which a person, in exchange for fees, dues, charges, or other consideration, provides access for plan members to providers of medical services and the right to receive medical services from those providers at a discount. The term discount medical plan does not include any product regulated as an insurance product, group health service product or health maintenance organization (HMO) product in the State of Oklahoma or discounts provided by an insurer, group health service, or health maintenance organizations (HMOs) where those discounts are provided at no cost to the insured or member and are offered due to coverage with a licensed insurer, group health service, or HMO;&nbsp;</span></p> <p><span class="cls0">4. "Discount medical plan organization" means a person or an entity which operates a discount medical plan;&nbsp;</span></p> <p><span class="cls0">5. "Health care provider" means any person or entity licensed by this state to provide health care services including, but not limited to, physicians, hospitals, home health agencies, pharmacies, and dentists;&nbsp;</span></p> <p><span class="cls0">6. &ldquo;Health care provider network&rdquo; means an entity which directly contracts with physicians and hospitals and has contractual rights to negotiate on behalf of those health care providers with a discount medical plan organization to provide medical services to members of the discount medical plan organization;&nbsp;</span></p> <p><span class="cls0">7. "Marketer" means a person or entity who markets, promotes, sells or distributes a discount medical plan, including a private label entity that places its name on and markets or distributes a discount medical plan but does not operate a discount medical plan;&nbsp;</span></p> <p><span class="cls0">8. "Medical services" means any care, service or treatment of illness or dysfunction of, or injury to, the human body including, but not limited to, physician care, inpatient care, hospital surgical services, emergency services, ambulance services, dental care services, vision care services, mental health services, substance abuse services, chiropractic services, podiatric care services, laboratory services, and medical equipment and supplies. The term does not include pharmaceutical supplies or prescriptions;&nbsp;</span></p> <p><span class="cls0">9. "Member" means any person who pays fees, dues, charges, or other consideration for the right to receive the purported benefits of a discount medical plan; and&nbsp;</span></p> <p><span class="cls0">10. "Person" means an individual, corporation, business trust, estate, trust, partnership, association, joint venture, limited liability company, or any other government or commercial entity.&nbsp;</span></p> <p><span class="cls0">B. 1. Before doing business in this state as a discount medical plan organization, an entity shall be a corporation, limited liability corporation, partnership, limited liability partnership or other legal entity, organized under the laws of this state or, if a foreign entity, authorized to transact business in this state, and shall be registered as a discount medical plan organization with the Insurance Department or be licensed by the Insurance Department as a licensed insurance company, licensed HMO, licensed group health service organization or motor service club.&nbsp;</span></p> <p><span class="cls0">2. To register as a discount medical plan organization, an applicant shall:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;file with the Insurance Department an application on the form that the Insurance Commissioner requires, and&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;pay to the Insurance Department an application fee of Two Hundred Fifty Dollars ($250.00).&nbsp;</span></p> <p><span class="cls0">3. A registration is valid for a one-year term.&nbsp;</span></p> <p><span class="cls0">4. A registration expires one year following the registration unless it is renewed as provided in this subsection.&nbsp;</span></p> <p><span class="cls0">5. Before it expires, a registrant may renew the registration for an additional one-year term if the registrant:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;otherwise is entitled to be registered,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;files with the Insurance Department a renewal application on the form that the Insurance Commissioner requires, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;pays to the Insurance Department a renewal fee of Two Hundred Fifty Dollars ($250.00).&nbsp;</span></p> <p><span class="cls0">6. The Insurance Commissioner may deny a registration to an applicant or refuse to renew, suspend, or revoke the registration of a registrant if the applicant or registrant, or an officer, director, or employee of the applicant or registrant:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;makes a material misstatement or misrepresentation in an application for registration,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;fraudulently or deceptively obtains or attempts to obtain a registration for the applicant or registrant or for another,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;in connection with the administration of a health care discount program, commits fraud or engages in illegal or dishonest activities, or&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;has violated any provisions of this section.&nbsp;</span></p> <p><span class="cls0">7. Prior to registration by the Insurance Department, each discount medical plan organization shall establish an Internet web site.&nbsp;</span></p> <p><span class="cls0">8. All amounts collected as registration or renewal fees shall be deposited into the General Revenue Fund.&nbsp;</span></p> <p><span class="cls0">9. Nothing in this subsection shall require a provider who provides discounts to his or her own patients to obtain and maintain a registration as a discount medical plan organization.&nbsp;</span></p> <p class="cls2"><span class="cls0">10.&nbsp;&nbsp;a.&nbsp;&nbsp;Nothing in this subsection shall apply to an affiliate of a licensed insurance company, HMO, group health service organization or motor service club, provided that the affiliate registers with and maintains registration in good standing with the Insurance Department in accordance with subparagraphs b and c of this paragraph.&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;An affiliate shall register as a discount medical plan organization on a form prescribed by the Insurance Commissioner prior to the sale, marketing or solicitation of a discount medical plan and pay an application fee of One Hundred Dollars ($100.00).&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;A registration shall expire one (1) year after the date of registration, and each year on that date thereafter. A registrant may renew the registration if the registrant pays an annual registration fee of One Hundred Dollars ($100.00) and remains in good standing with the Insurance Department.&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;For purposes of this section, &ldquo;affiliate&rdquo; means a person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with an insurance company, HMO, group health service organization or motor service club licensed in this state.&nbsp;</span></p> <p><span class="cls0">C. 1. The Insurance Department may examine or investigate the business and affairs of any discount medical plan organization. The Insurance Department may require any discount medical plan organization or applicant to produce any records, books, files, advertising and solicitation materials, or other information and may take statements under oath to determine whether the discount medical plan organization or applicant is in violation of the law or is acting contrary to the public interest. The expenses incurred in conducting any examination or investigation shall be paid by the discount medical plan organization or applicant. Examinations and investigations shall be conducted as provided in Sections 309.1 and 309.3 through 309.7 of this title. Discount medical plan organizations shall be governed by the provisions of this section and shall not be subject to the provisions of the Insurance Code unless specifically referenced.&nbsp;</span></p> <p><span class="cls0">2. All work papers, recorded information, documents, books, files, advertising and solicitation materials, copies or other information produced by, obtained by or disclosed to the Commissioner or any other person in the course of an examination or investigation made pursuant to this section or in the course of analysis by the Commissioner or other person, shall be given confidential treatment by the Commissioner and may not be made public by the Commissioner or any other person who obtained the information in the course of the examination or investigation, except to the extent provided in this section. Access may be granted to the National Association of Insurance Commissioners. The parties shall agree in writing prior to receiving the information to provide to it the same confidential treatment as required by this section, unless the prior written consent of the company to which it pertains has been obtained. The confidentiality and protection from discovery by subpoena provided for in this paragraph shall not be construed to be extended to identical, similar or other related documents or information or to the work papers that are not deemed to be in the possession, custody or control of the Commissioner.&nbsp;</span></p> <p><span class="cls0">3. Failure by the discount medical plan organization to pay the expenses incurred under paragraph 1 of this subsection shall be grounds for denial or revocation of the discount medical plan organization&rsquo;s registration.&nbsp;</span></p> <p><span class="cls0">D. 1. A discount medical plan organization may charge a reasonable one-time processing fee and a periodic charge.&nbsp;</span></p> <p><span class="cls0">2. If the member cancels the membership within the first thirty (30) days after receipt of the discount card and other membership materials, the member shall receive a reimbursement of all periodic charges paid. The return of all periodic charges shall be made within thirty (30) days of the date of the cancellation. If all of the periodic charges have not been paid within thirty (30) days, interest shall be assessed and paid on the proceeds at a rate of the Treasury Bill rate of the preceding calendar year, plus two (2) percentage points.&nbsp;</span></p> <p><span class="cls0">3. The right of cancellation shall be set out in the contract on the first page, in ten-point type or larger.&nbsp;</span></p> <p><span class="cls0">4. If a discount medical plan charges for a time period in excess of one (1) month, the plan shall, in the event of cancellation of the membership by either party, make a pro rata reimbursement of all periodic charges to the member.&nbsp;</span></p> <p><span class="cls0">E. 1. A discount medical plan organization may not:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;use in its advertisements, marketing material, brochures, and discount cards the terms &ldquo;insurance&rdquo;, "health plan", "coverage", "copay", "copayments", "preexisting conditions", "guaranteed issue", "premium", "PPO", "preferred provider organization&rdquo;, or other terms in a manner that could reasonably mislead a person to believe that the discount medical plan is health insurance,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;except for hospital services, have restrictions on free access to plan providers including waiting periods and notification periods, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;pay providers any fees for medical services.&nbsp;</span></p> <p><span class="cls0">2. A discount medical plan organization may not collect or accept money from a member for payment to a provider for specific medical services furnished or to be furnished to the member unless the organization has an active license from the Insurance Department to act as an administrator.&nbsp;</span></p> <p><span class="cls0">F. 1. The following disclosures, to be printed in not less than twelve-point type, shall be made in writing to any prospective member and shall appear on the first page of any advertisements, marketing materials or brochures relating to a discount medical plan:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;that the plan is not insurance,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;that the plan provides discounts with certain health care providers for medical services,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;that the plan does not make payments directly to the providers of medical services,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;that the plan member is obligated to pay for all health care services but will receive a discount from those health care providers who have contracted with the discount plan organization, and&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;the name and the location of the registered discount medical plan organization, including the current telephone number of the registered discount medical plan organization or other entity responsible for customer service for the plan, if different from the registered discount medical plan organization.&nbsp;</span></p> <p><span class="cls0">2. If the discount medical plan is sold, marketed, or solicited by telephone, the disclosures required by this section shall be made orally and provided in the initial written materials that describe the benefits under the discount medical plan provided to the prospective or new member.&nbsp;</span></p> <p><span class="cls0">3. The discount card provided to members shall prominently display the words &ldquo;This is not insurance&rdquo;.&nbsp;</span></p> <p><span class="cls0">G. 1. All providers offering medical services to members under a discount medical plan shall provide such services pursuant to a written agreement. The agreement may be entered into directly by the health care provider or by a health care provider network to which the provider belongs if the provider network has contracts with the health care provider that allow the provider network to contract on behalf of the health care provider.&nbsp;</span></p> <p><span class="cls0">2. A health care provider agreement shall provide the following:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;a description of the services and products to be provided at a discount,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the amount or amounts of the discounts or, alternatively, a fee schedule which reflects the health care provider's discounted rates, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;a provision that the health care provider will not charge members more than the discounted rates.&nbsp;</span></p> <p><span class="cls0">3. A health care provider agreement with a health care provider network shall require that the health care provider network have written agreements with its health care providers that:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;contain the terms described in paragraph 2 of this subsection,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;authorize the health care provider network to contract with the discount medical plan organization on behalf of the provider, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;require the network to maintain an up-to-date list of its contracted health care providers and to provide that list on a quarterly basis to the discount medical plan organization.&nbsp;</span></p> <p><span class="cls0">4. The discount medical plan organization shall maintain a copy of each active health care provider agreement into which it has entered.&nbsp;</span></p> <p><span class="cls0">H. 1. There shall be a written agreement between the discount medical plan organization and the member specifying the benefits under the discount medical plan and complying with the disclosure requirements of this section.&nbsp;</span></p> <p><span class="cls0">2. All forms used, including the written agreement pursuant to the provisions of subsection G of this section, shall first be filed with the Insurance Department. Every form filed shall be identified by a unique form number placed in the lower left corner of each form. A filing fee of Twenty-five Dollars ($25.00) per form shall be payable to the Insurance Department for deposit into the General Revenue Fund.&nbsp;</span></p> <p><span class="cls0">I. 1. Each discount medical plan organization required to be registered pursuant to this section except an affiliate shall, at all times, maintain a net worth of at least One Hundred Fifty Thousand Dollars ($150,000.00).&nbsp;</span></p> <p><span class="cls0">2. The Insurance Department may not allow a registration unless the discount medical plan organization has a net worth of at least One Hundred Fifty Thousand Dollars ($150,000.00).&nbsp;</span></p> <p><span class="cls0">J. 1. The Insurance Department may suspend the authority of a discount medical plan organization to enroll new members, revoke any registration issued to a discount medical plan organization, or order compliance if the Department finds that any of the following conditions exist:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the organization is not operating in compliance with the provisions of this section,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the organization does not have the minimum net worth as required by this section,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the organization has advertised, merchandised or attempted to merchandise its services in such a manner as to misrepresent its services or capacity for service or has engaged in deceptive, misleading or unfair practices with respect to advertising or merchandising,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;the organization is not fulfilling its obligations as a discount medical plan organization, or&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;the continued operation of the organization would be hazardous to its members.&nbsp;</span></p> <p><span class="cls0">2. If the Insurance Department has cause to believe that grounds for the suspension or revocation of a registration exist, the Insurance Department shall notify the discount medical plan organization in writing, specifically stating the grounds for suspension or revocation, and shall provide opportunity for a hearing on the matter in accordance with the Administrative Procedures Act and the Oklahoma Insurance Code.&nbsp;</span></p> <p><span class="cls0">3. When the certificate of registration of a discount medical plan organization is nonrenewed, surrendered or revoked, such organization shall proceed, immediately following the effective date of the order of revocation, or in the case of nonrenewal, the date of expiration of the certificate of registration, to wind up its affairs transacted under the certificate of registration. The organization may not engage in any further advertising, solicitation, collecting of fees, or renewal of contracts.&nbsp;</span></p> <p><span class="cls0">4. The Insurance Department shall, in its order suspending the authority of a discount medical plan organization to enroll new members, specify the period during which the suspension is to be in effect and the conditions, if any, which shall be met by the discount medical plan organization prior to reinstatement of its registration to enroll new members. The order of suspension is subject to rescission or modification by further order of the Insurance Department prior to the expiration of the suspension period. Reinstatement may not be made unless requested by the discount medical plan organization; however, the Insurance Department may not grant reinstatement if it finds that the circumstances for which the suspension occurred still exist or are likely to reoccur.&nbsp;</span></p> <p><span class="cls0">K. Each discount medical plan organization required to be registered pursuant to this section shall provide the Insurance Department at least thirty (30) days' advance notice of any change in the discount medical plan organization's name, address, principal business address, or mailing address.&nbsp;</span></p> <p><span class="cls0">L. Each discount medical plan organization shall maintain an up-to-date list of the names and addresses of the providers with which it has contracted on an Internet web site page, the address of which shall be prominently displayed on all its advertisements, marketing materials, brochures, and discount cards. This section applies to those providers with whom the discount medical plan organization has contracted directly, as well as those who are members of a provider network with which the discount medical plan organization has contracted.&nbsp;</span></p> <p><span class="cls0">M. 1. All advertisements, marketing materials, brochures and discount cards used by marketers shall be approved in writing for such use by the discount medical plan organization.&nbsp;</span></p> <p><span class="cls0">2. The discount medical plan organization shall have an executed written agreement with a marketer prior to the marketer's marketing, promoting, selling, or distributing the discount medical plan.&nbsp;</span></p> <p><span class="cls0">N. The Insurance Commissioner may promulgate rules to administer the provisions of this section.&nbsp;</span></p> <p><span class="cls0">O. Regulation of discount medical plan organizations shall be done pursuant to the Administrative Procedures Act.&nbsp;</span></p> <p><span class="cls0">P. 1. A discount medical plan organization required to be registered pursuant to this section except an affiliate shall maintain a surety bond with the Insurance Department, having at all times a value of not less than Thirty-five Thousand Dollars ($35,000.00), for use by the Insurance Department in protecting plan members.&nbsp;</span></p> <p><span class="cls0">2. No judgment creditor or other claimant of a discount medical plan organization, other than the Insurance Department, shall have the right to levy upon the surety bond held pursuant to the provisions of paragraph 1 of this subsection.&nbsp;</span></p> <p><span class="cls0">Q. 1. A person who knowingly and willfully operates as or aids and abets another operating as a discount medical plan organization in violation of subsection B of this section commits a felony, punishable as provided for in Oklahoma law, as if the discount medical plan organization were an unauthorized insurer, and the fees, dues, charges, or other consideration collected from the members by the discount medical plan organization or marketer were insurance premium.&nbsp;</span></p> <p><span class="cls0">2. A person who collects fees for purported membership in a discount medical plan but fails to provide the promised benefits commits a theft, punishable as provided in Oklahoma law.&nbsp;</span></p> <p><span class="cls0">R. 1. In addition to the penalties and other enforcement provisions of this section, the Insurance Department may seek both temporary and permanent injunctive relief if:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;a discount medical plan organization is being operated by any person or entity that is not registered pursuant to this section, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;any person, entity, or discount medical plan organization has engaged in any activity prohibited by this section or any rule adopted pursuant to this section.&nbsp;</span></p> <p><span class="cls0">2. The venue for any proceeding brought pursuant to the provisions of this section shall be in the district court of Oklahoma County.&nbsp;</span></p> <p><span class="cls0">S. 1. The provisions of this section apply to the activities of a discount medical plan organization that is not registered pursuant to this section as if the discount medical plan organization were an unauthorized insurer.&nbsp;</span></p> <p><span class="cls0">2. A discount medical plan organization being operated by any person or entity that is not registered pursuant to this section, or any person, entity or discount medical plan organization that has engaged or is engaging in any activity prohibited by this section or any rules adopted pursuant to this section shall be subject to the Unauthorized Insurer Act as if the discount medical plan organization were an unauthorized insurer, and shall be subject to all the remedies available to the Insurance Commissioner under the Unauthorized Insurer Act.&nbsp;</span></p> <p><span class="cls0">T. If the Insurance Commissioner finds that a discount medical plan organization has violated any provision of this section or that grounds exist for the discretionary revocation or suspension of a registration, the Commissioner, in lieu of such revocation or suspension, may impose a fine upon the discount medical plan organization in an amount not to exceed One Thousand Dollars ($1,000.00) per violation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 363, &sect; 11, eff. July 1, 2001. Amended by Laws 2002, c. 307, &sect; 12, eff. Nov. 1, 2002; Laws 2005, c. 425, &sect; 1, eff. Nov. 1, 2005; Laws 2007, c. 125, &sect; 9, eff. July 1, 2007; Laws 2009, c. 176, &sect; 23, eff. Nov. 1, 2009; Laws 2010, c. 356, &sect; 4, eff. Nov. 1, 2010; Laws 2012, c. 149, &sect; 2, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1219.5. Modification of existing or issuance of new coverage - Consent.&nbsp;</span></p> <p><span class="cls0">No insurer shall modify a group or individual policy of existing coverage or issue new coverage under an accident and health insurance policy unless written consent for such modification or issuance is obtained from the policyholder. However, this section shall not be construed as prohibiting a modification that is provided for in an existing policy that has been filed and approved by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2003, c. 288, &sect; 1, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361220. Exclusive agents Restrictions.&nbsp;</span></p> <p><span class="cls0">No insurance company, including any subsidiary of any such company, may offer any insurance program in this state to exclusive agents without offering the same insurance program through all of its other authorized agents and brokers authorized for similar types of insurance coverage.&nbsp;</span></p> <p class="cls1"><span class="cls0">Added by Laws 1985, c. 328, &sect; 9, emerg. eff. July 29, 1985. &nbsp;</span></p> <p><span class="cls0">&sect;361221. Renumbered as &sect; 1250.1 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;36-1222. Repealed by Laws 1994, c. 342, &sect; 21, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361223. Renumbered as &sect; 1250.9 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361224. Renumbered as &sect; 1250.10 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361225. Renumbered as &sect; 1250.11 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361226. Renumbered as &sect; 1250.13 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361227. Renumbered as &sect; 1250.3 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;36-1228. Repealed by Laws 1994, c. 342, &sect; 21, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;36-1241. Property and casualty insurer - Acceptance or denial of application.&nbsp;</span></p> <p><span class="cls0">A property and casualty insurer shall, within forty-five (45) business days of taking an application, determine whether or not the applicant should be accepted or denied as an insured and shall give written notice to the agent of the acceptance or denial. If the applicant is denied as an insured, any premium monies paid, less any expenses incurred either by the agent or the insurer, shall be immediately returned to the proposed purchaser of the policy. Failure of the insurer to return premium monies to the applicant within forty-five (45) business days of the initial submission to the insurer, broker, or agent, shall result in the applicant recovering any interest and bank charges which the proposed insured has incurred because of the delay in return of the initial premium, less expenses incurred. In addition, if the insurer does not return the premium monies, less expenses, within the forty-five-day period, the insurer shall remain liable for the insurance coverage and any claims pursuant thereto which the remaining premium monies would have purchased.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 23, eff. Nov. 1, 1986. Amended by Laws 1987, c. 175, &sect; 9, eff. Nov. 1, 1987; Laws 2000, c. 353, &sect; 8, eff. Nov. 1, 2000; Laws 2001, c. 363, &sect; 12, eff. July 1, 2001.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1241.1. Property and casualty policies &ndash; Provision relating to process for premium refund for cancellation prior to end of policy period.&nbsp;</span></p> <p><span class="cls0">Each property and casualty insurance policy approved by the Insurance Commissioner shall contain a provision describing the process for premium refund if the insured cancels the policy before the end of the policy period as defined in the policy. The provision is to be included in the policy, or by rider or endorsement attached to the policy. The policy does not have to contain the exact wording of this section or any other exact wording. Language which is substantially similar to this section shall be considered to be in compliance with this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2004, c. 96, &sect; 3, eff. Nov. 1, 2004.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1241.2. Property and casualty policies &ndash; Inquiry regarding making claim &ndash; Increase of premium rates, cancellation, or refusal to issue or renew policy.&nbsp;</span></p> <p><span class="cls0">No insurer that issues any type of property or casualty insurance policy in this state shall increase premium rates, cancel a policy, or refuse to issue or renew a policy solely on the basis of a policyholder inquiring about making a claim or requesting information about a possible claim, if the policyholder does not in fact submit a claim.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2004, c. 96, &sect; 4, eff. Nov. 1, 2004.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1250.1. Short title.&nbsp;</span></p> <p><span class="cls0">Sections 1250.1 through 1250.16 of this title shall constitute a part of the Oklahoma Insurance Code and shall be known and may be cited as the "Unfair Claims Settlement Practices Act".&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 5, emerg. eff. June 24, 1986. Amended by Laws 1994, c. 342, &sect; 1, eff. Sept. 1, 1994. Renumbered from &sect; 1221 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1997, c. 5, &sect; 1, emerg. eff. March 25, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1250.2. Definitions.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">As used in the Unfair Claims Settlement Practices Act:&nbsp;</span></p> <p><span class="cls0">1. "Agent" means any individual, corporation, association, partnership, or other legal entity authorized to represent an insurer with respect to a claim;&nbsp;</span></p> <p><span class="cls0">2. "Claimant" means either a first party claimant, a third party claimant, or both, and includes such claimant's designated legal representatives and includes a member of the claimant's immediate family designated by the claimant;&nbsp;</span></p> <p><span class="cls0">3. "Commissioner" means the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">4. "First party claimant" means an individual, corporation, association, partnership, or other legal entity, including a subscriber under any plan providing health services, asserting a right to payment pursuant to an insurance policy or insurance contract for an occurrence of contingency or loss covered by such policy or contract;&nbsp;</span></p> <p><span class="cls0">5. &ldquo;Health benefit plan&rdquo; means group hospital or medical insurance coverage, a not-for-profit hospital or medical service or indemnity plan, a prepaid health plan, a health maintenance organization plan, a preferred provider organization plan, the State and Education Employees Group Health Insurance Plan, and coverage provided by a Multiple Employer Welfare Arrangement (MEWA) or employee self-insured plan except as exempt under federal ERISA provisions. The term shall not include short-term accident, fixed indemnity, or specified disease policies, disability income contracts, limited benefit or credit disability insurance, workers&rsquo; compensation insurance coverage, automobile medical payment insurance, or insurance under which benefits are payable with or without regard to fault and which is required by law to be contained in any liability insurance policy or equivalent self-insurance;&nbsp;</span></p> <p><span class="cls0">6. "Insurance policy or insurance contract" means any contract of insurance, certificate, indemnity, medical or hospital service, suretyship, annuity, subscriber certificate or any evidence of coverage of a health maintenance organization issued, proposed for issuance, or intended for issuance by any entity subject to this Code;&nbsp;</span></p> <p><span class="cls0">7. "Insurer" means a person licensed by the Commissioner to issue or who issues any insurance policy or insurance contract in this state, including CompSource, and also includes health maintenance organizations. Provided that, for the purposes of paragraphs 15 and 16 of Section 1250.5 of this title, &ldquo;insurer&rdquo; shall include the State and Education Employees Group Insurance Board;&nbsp;</span></p> <p><span class="cls0">8. "Investigation" means all activities of an insurer directly or indirectly related to the determination of liabilities under coverages afforded by an insurance policy or insurance contract;&nbsp;</span></p> <p><span class="cls0">9. "Notification of claim" means any notification, whether in writing or other means acceptable under the terms of an insurance policy or insurance contract, to an insurer or its agent, by a claimant, which reasonably apprises the insurer of the facts pertinent to a claim;&nbsp;</span></p> <p><span class="cls0">10. &ldquo;Preauthorization/precertification&rdquo; means a determination by a health benefit plan, based on the information presented at the time by the health care provider, that health care services proposed by the health care provider are medically necessary. The term shall include &ldquo;authorization&rdquo;, &ldquo;certification&rdquo; and any other term that would be a reliable determination by a health benefit plan. A preauthorization/precertification from a previous health plan shall not bind a succeeding health benefit plan;&nbsp;</span></p> <p><span class="cls0">11. "Third party claimant" means any individual, corporation, association, partnership, or other legal entity asserting a claim against any individual, corporation, association, partnership, or other legal entity insured under an insurance policy or insurance contract; and&nbsp;</span></p> <p><span class="cls0">12. &ldquo;Verification of eligibility&rdquo; means a representation by a health benefit plan to a health care provider that a claimant is entitled to covered benefits under the policy. Such verification of eligibility shall be valid for four (4) business days from the date given by the health benefit plan.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 14, eff. Nov. 1, 1986. Amended by Laws 1994, c. 342, &sect; 2, eff. Sept. 1, 1994. Renumbered from &sect; 1252 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 4, emerg. eff. Nov. 4, 1994; Laws 2003, c. 197, &sect; 53, eff. Nov. 1, 2003; Laws 2004, c. 274, &sect; 7, eff. July 1, 2004; Laws 2005, c. 170, &sect; 1, eff. Nov. 1, 2005; Laws 2009, c. 323, &sect; 1, eff. July 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">As used in the Unfair Claims Settlement Practices Act:&nbsp;</span></p> <p><span class="cls0">1. "Agent" means any individual, corporation, association, partnership, or other legal entity authorized to represent an insurer with respect to a claim;&nbsp;</span></p> <p><span class="cls0">2. "Claimant" means either a first party claimant, a third party claimant, or both, and includes such claimant's designated legal representatives and includes a member of the claimant's immediate family designated by the claimant;&nbsp;</span></p> <p><span class="cls0">3. "Commissioner" means the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">4. "First-party claimant" means an individual, corporation, association, partnership, or other legal entity, including a subscriber under any plan providing health services, asserting a right to payment pursuant to an insurance policy or insurance contract for an occurrence of contingency or loss covered by such policy or contract;&nbsp;</span></p> <p><span class="cls0">5. "Health benefit plan" means group hospital or medical insurance coverage, a not-for-profit hospital or medical service or indemnity plan, a prepaid health plan, a health maintenance organization plan, a preferred provider organization plan, the State and Education Employees Group Health Insurance Plan, and coverage provided by a Multiple Employer Welfare Arrangement (MEWA) or employee self-insured plan except as exempt under federal ERISA provisions. The term shall not include short-term accident, fixed indemnity, or specified disease policies, disability income contracts, limited benefit or credit disability insurance, workers' compensation insurance coverage, automobile medical payment insurance, or insurance under which benefits are payable with or without regard to fault and which is required by law to be contained in any liability insurance policy or equivalent self-insurance;&nbsp;</span></p> <p><span class="cls0">6. "Insurance policy or insurance contract" means any contract of insurance, certificate, indemnity, medical or hospital service, suretyship, annuity, subscriber certificate or any evidence of coverage of a health maintenance organization issued, proposed for issuance, or intended for issuance by any entity subject to this Code;&nbsp;</span></p> <p><span class="cls0">7. "Insurer" means a person licensed by the Commissioner to issue or who issues any insurance policy or insurance contract in this state and also includes health maintenance organizations. Provided that, for the purposes of paragraphs 15 and 16 of Section 1250.5 of this title, "insurer" shall include the State and Education Employees Group Insurance Board;&nbsp;</span></p> <p><span class="cls0">8. "Investigation" means all activities of an insurer directly or indirectly related to the determination of liabilities under coverages afforded by an insurance policy or insurance contract;&nbsp;</span></p> <p><span class="cls0">9. "Notification of claim" means any notification, whether in writing or other means acceptable under the terms of an insurance policy or insurance contract, to an insurer or its agent, by a claimant, which reasonably apprises the insurer of the facts pertinent to a claim;&nbsp;</span></p> <p><span class="cls0">10. "Preauthorization/precertification" means a determination by a health benefit plan, based on the information presented at the time by the health care provider, that health care services proposed by the health care provider are medically necessary. The term shall include "authorization", "certification" and any other term that would be a reliable determination by a health benefit plan. A preauthorization/precertification from a previous health plan shall not bind a succeeding health benefit plan;&nbsp;</span></p> <p><span class="cls0">11. "Third-party claimant" means any individual, corporation, association, partnership, or other legal entity asserting a claim against any individual, corporation, association, partnership, or other legal entity insured under an insurance policy or insurance contract; and&nbsp;</span></p> <p><span class="cls0">12. "Verification of eligibility" means a representation by a health benefit plan to a health care provider that a claimant is entitled to covered benefits under the policy. Such verification of eligibility shall be valid for four (4) business days from the date given by the health benefit plan.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 14, eff. Nov. 1, 1986. Amended by Laws 1994, c. 342, &sect; 2, eff. Sept. 1, 1994. Renumbered from &sect; 1252 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 4, emerg. eff. Nov. 4, 1994; Laws 2003, c. 197, &sect; 53, eff. Nov. 1, 2003; Laws 2004, c. 274, &sect; 7, eff. July 1, 2004; Laws 2005, c. 170, &sect; 1, eff. Nov. 1, 2005; Laws 2009, c. 323, &sect; 1, eff. July 1, 2010; Laws 2013, c. 254, &sect; 19, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1250.3. Application of law; conditions under which acts constitute unfair claims settlement practices.&nbsp;</span></p> <p><span class="cls0">A. The provisions of the Unfair Claims Settlement Practices Act shall apply to all claims arising under an insurance policy or insurance contract issued by any insurer.&nbsp;</span></p> <p><span class="cls0">B. It is an unfair claim settlement practice for any insurer to commit any act set out in Section 1250.5 of this title, or to commit a violation of any other provision of the Unfair Claims Settlement Practices Act, if:&nbsp;</span></p> <p><span class="cls0">1. It is committed flagrantly and in conscious disregard of this act or any rules promulgated hereunder; or&nbsp;</span></p> <p><span class="cls0">2. It has been committed with such frequency as to indicate a general business practice to engage in that type of conduct.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 11, emerg. eff. June 24, 1986. Amended by Laws 1992, c. 74, &sect; 4, eff. Sept. 1, 1992; Laws 1994, c. 342, &sect; 3, eff. Sept. 1, 1994. Renumbered from &sect; 1227 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1997, c. 5, &sect; 2, emerg. eff. March 25, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1250.4. Claim files - Examination - Response to inquiries.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">A. An insurer's claim files, other than the claim files of the State Insurance Fund, shall be subject to examination by the Insurance Commissioner or by duly appointed designees. Such files shall contain all notes and work papers pertaining to a claim in such detail that pertinent events and the dates of such events can be reconstructed. In addition, the Insurance Commissioner, authorized employees and examiners shall have access to any of an insurer's files that may relate to a particular complaint under investigation or to an inquiry or examination by the Insurance Department.&nbsp;</span></p> <p><span class="cls0">B. Every agent, adjuster, administrator, insurance company representative, or insurer, other than the State Insurance Fund and its representatives, upon receipt of any inquiry from the Commissioner shall, within thirty (30) days from the date of the inquiry, furnish the Commissioner with an adequate response to the inquiry.&nbsp;</span></p> <p><span class="cls0">C. Every insurer, upon receipt of any pertinent written communication including but not limited to e-mail or other forms of written electronic communication, or documentation by the insurer of a verbal communication from a claimant which reasonably suggests that a response is expected, shall, within thirty (30) days after receipt thereof, furnish the claimant with an adequate response to the communication.&nbsp;</span></p> <p><span class="cls0">D. Any violation by an insurer of this section shall subject the insurer to discipline including a civil penalty of not less than One Hundred Dollars ($100.00) nor more than Five Thousand Dollars ($5,000.00).&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 15, eff. Nov. 1, 1986. Amended by Laws 1989, c. 181, &sect; 1, eff. Nov. 1, 1989; Laws 1994, c. 342, &sect; 4, eff. Sept. 1, 1994. Renumbered from &sect; 1253 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 5, emerg. eff. Nov. 4, 1994; Laws 1997, c. 418, &sect; 51, eff. Nov. 1, 1997; Laws 2010, c. 222, &sect; 24, eff. Nov. 1, 2010.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">A. An insurer's claim files shall be subject to examination by the Insurance Commissioner or by duly appointed designees. Such files shall contain all notes and work papers pertaining to a claim in such detail that pertinent events and the dates of such events can be reconstructed. In addition, the Insurance Commissioner, authorized employees and examiners shall have access to any of an insurer's files that may relate to a particular complaint under investigation or to an inquiry or examination by the Insurance Department.&nbsp;</span></p> <p><span class="cls0">B. Every agent, adjuster, administrator, insurance company representative, or insurer upon receipt of any inquiry from the Commissioner shall, within thirty (30) days from the date of the inquiry, furnish the Commissioner with an adequate response to the inquiry.&nbsp;</span></p> <p><span class="cls0">C. Every insurer, upon receipt of any pertinent written communication including but not limited to e-mail or other forms of written electronic communication, or documentation by the insurer of a verbal communication from a claimant which reasonably suggests that a response is expected, shall, within thirty (30) days after receipt thereof, furnish the claimant with an adequate response to the communication.&nbsp;</span></p> <p><span class="cls0">D. Any violation by an insurer of this section shall subject the insurer to discipline including a civil penalty of not less than One Hundred Dollars ($100.00) nor more than Five Thousand Dollars ($5,000.00).&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 15, eff. Nov. 1, 1986. Amended by Laws 1989, c. 181, &sect; 1, eff. Nov. 1, 1989; Laws 1994, c. 342, &sect; 4, eff. Sept. 1, 1994. Renumbered from &sect; 1253 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 5, emerg. eff. Nov. 4, 1994; Laws 1997, c. 418, &sect; 51, eff. Nov. 1, 1997; Laws 2010, c. 222, &sect; 24, eff. Nov. 1, 2010; Laws 2013, c. 254, &sect; 20, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1250.5. Acts by an insurer constituting unfair claim settlement practice.&nbsp;</span></p> <p><span class="cls0">Any of the following acts by an insurer, if committed in violation of Section 1250.3 of this title, constitutes an unfair claim settlement practice exclusive of paragraph 16 of this section which shall be applicable solely to health benefit plans:&nbsp;</span></p> <p><span class="cls0">1. Failing to fully disclose to first party claimants, benefits, coverages, or other provisions of any insurance policy or insurance contract when the benefits, coverages or other provisions are pertinent to a claim;&nbsp;</span></p> <p><span class="cls0">2. Knowingly misrepresenting to claimants pertinent facts or policy provisions relating to coverages at issue;&nbsp;</span></p> <p><span class="cls0">3. Failing to adopt and implement reasonable standards for prompt investigations of claims arising under its insurance policies or insurance contracts;&nbsp;</span></p> <p><span class="cls0">4. Not attempting in good faith to effectuate prompt, fair and equitable settlement of claims submitted in which liability has become reasonably clear;&nbsp;</span></p> <p><span class="cls0">5. Failing to comply with the provisions of Section 1219 of this title;&nbsp;</span></p> <p><span class="cls0">6. Denying a claim for failure to exhibit the property without proof of demand and unfounded refusal by a claimant to do so;&nbsp;</span></p> <p><span class="cls0">7. Except where there is a time limit specified in the policy, making statements, written or otherwise, which require a claimant to give written notice of loss or proof of loss within a specified time limit and which seek to relieve the company of its obligations if the time limit is not complied with unless the failure to comply with the time limit prejudices the rights of an insurer;&nbsp;</span></p> <p><span class="cls0">8. Requesting a claimant to sign a release that extends beyond the subject matter that gave rise to the claim payment;&nbsp;</span></p> <p><span class="cls0">9. Issuing checks or drafts in partial settlement of a loss or claim under a specified coverage which contain language releasing an insurer or its insured from its total liability;&nbsp;</span></p> <p><span class="cls0">10. Denying payment to a claimant on the grounds that services, procedures, or supplies provided by a treating physician or a hospital were not medically necessary unless the health insurer or administrator, as defined in Section 1442 of this title, first obtains an opinion from any provider of health care licensed by law and preceded by a medical examination or claim review, to the effect that the services, procedures or supplies for which payment is being denied were not medically necessary. Upon written request of a claimant, treating physician, or hospital, the opinion shall be set forth in a written report, prepared and signed by the reviewing physician. The report shall detail which specific services, procedures, or supplies were not medically necessary, in the opinion of the reviewing physician, and an explanation of that conclusion. A copy of each report of a reviewing physician shall be mailed by the health insurer, or administrator, postage prepaid, to the claimant, treating physician or hospital requesting same within fifteen (15) days after receipt of the written request. As used in this paragraph, "physician" means a person holding a valid license to practice medicine and surgery, osteopathic medicine, podiatric medicine, dentistry, chiropractic, or optometry, pursuant to the state licensing provisions of Title 59 of the Oklahoma Statutes;&nbsp;</span></p> <p><span class="cls0">11. Compensating a reviewing physician, as defined in paragraph 10 of this subsection, on the basis of a percentage of the amount by which a claim is reduced for payment;&nbsp;</span></p> <p><span class="cls0">12. Violating the provisions of the Health Care Fraud Prevention Act;&nbsp;</span></p> <p><span class="cls0">13. Compelling, without just cause, policyholders to institute suits to recover amounts due under its insurance policies or insurance contracts by offering substantially less than the amounts ultimately recovered in suits brought by them, when the policyholders have made claims for amounts reasonably similar to the amounts ultimately recovered;&nbsp;</span></p> <p><span class="cls0">14. Failing to maintain a complete record of all complaints which it has received during the preceding three (3) years or since the date of its last financial examination conducted or accepted by the Commissioner, whichever time is longer. This record shall indicate the total number of complaints, their classification by line of insurance, the nature of each complaint, the disposition of each complaint, and the time it took to process each complaint. For the purposes of this paragraph, "complaint" means any written communication primarily expressing a grievance;&nbsp;</span></p> <p><span class="cls0">15. Requesting a refund of all or a portion of a payment of a claim made to a claimant or health care provider more than twenty-four (24) months after the payment is made. This paragraph shall not apply:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;if the payment was made because of fraud committed by the claimant or health care provider, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;if the claimant or health care provider has otherwise agreed to make a refund to the insurer for overpayment of a claim;&nbsp;</span></p> <p><span class="cls0">16. Failing to pay, or requesting a refund of a payment, for health care services covered under the policy if a health benefit plan, or its agent, has provided a preauthorization or precertification and verification of eligibility for those health care services. This paragraph shall not apply if:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the claim or payment was made because of fraud committed by the claimant or health care provider,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the subscriber had a preexisting exclusion under the policy related to the service provided, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the subscriber or employer failed to pay the applicable premium and all grace periods and extensions of coverage have expired; or&nbsp;</span></p> <p><span class="cls0">17. Denying or refusing to accept an application for life insurance, or refusing to renew, cancel, restrict or otherwise terminate a policy of life insurance, or charge a different rate based upon the lawful travel destination of an applicant or insured as provided in Section 4024 of this title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 16, eff. Nov. 1, 1986. Amended by Laws 1989, c. 238, &sect; 1, eff. Nov. 1, 1989; Laws 1991, c. 134, &sect; 9, eff. July 1, 1991; Laws 1993, c. 24, &sect; 1, eff. Sept. 1, 1993; Laws 1994, c. 342, &sect; 5, eff. Sept. 1, 1994. Renumbered from &sect; 1254 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1997, c. 156, &sect; 2, eff. Nov. 1, 1997; Laws 1997, c. 404, &sect; 3, eff. Nov. 1, 1997; Laws 1997, c. 418, &sect; 52, eff. Nov. 1, 1997; Laws 1999, c. 256, &sect; 1, eff. Nov. 1, 1999; Laws 2000, c. 353, &sect; 7, eff. Nov. 1, 2000; Laws 2009, c. 323, &sect; 2, eff. July 1, 2010; Laws 2012, c. 105, &sect; 1.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 1997, c. 5, &sect; 3 repealed by Laws 1997, c. 404, &sect; 8, eff. Nov. 1, 1997.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1250.6. Property and casualty insurer - Acknowledging receipt of claim - Commissioner's inquiry - Other communications - Claim forms, instructions and assistance.&nbsp;</span></p> <p><span class="cls0">A. Every property and casualty insurer, within thirty (30) days after receiving notification of a claim, shall acknowledge the receipt of such notification unless payment is made within such period of time. If an acknowledgement is made by means other than writing, an appropriate notation of such acknowledgement shall be made in the claim file of the property and casualty insurer, and dated. Notification given to an agent of a property and casualty insurer shall be notification to the insurer.&nbsp;</span></p> <p><span class="cls0">B. Every property and casualty insurer, upon receiving notification of a claim, promptly shall provide necessary claim forms, instruction, and reasonable assistance so that first party claimants can comply with the policy conditions and the reasonable requirements of the property and casualty insurer. Compliance with this paragraph within thirty (30) days after notification of a claim shall constitute compliance with subsection A of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 17, eff. Nov. 1, 1986. Amended by Laws 1987, c. 175, &sect; 10, eff. Nov. 1, 1987; Laws 1994, c. 342, &sect; 6, eff. Sept. 1, 1994. Renumbered from &sect; 1255 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994; Laws 1997, c. 418, &sect; 53, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1250.7. Property and casualty insurer - Denial or acceptance of claim.&nbsp;</span></p> <p><span class="cls0">A. Within forty-five (45) days after receipt by a property and casualty insurer of properly executed proofs of loss, the first party claimant shall be advised of the acceptance or denial of the claim by the insurer, or if further investigation is necessary. No property and casualty insurer shall deny a claim because of a specific policy provision, condition, or exclusion unless reference to such provision, condition, or exclusion is included in the denial. A denial shall be given to any claimant in writing, and the claim file of the property and casualty insurer shall contain a copy of the denial. If there is a reasonable basis supported by specific information available for review by the Commissioner that the first party claimant has fraudulently caused or contributed to the loss, a property and casualty insurer shall be relieved from the requirements of this subsection. In the event of a weather-related catastrophe or a major natural disaster, as declared by the Governor, the Insurance Commissioner may extend the deadline imposed under this subsection an additional twenty (20) days.&nbsp;</span></p> <p><span class="cls0">B. If a claim is denied for reasons other than those described in subsection A of this section, and is made by any other means than writing, an appropriate notation shall be made in the claim file of the property and casualty insurer until such time as a written confirmation can be made.&nbsp;</span></p> <p><span class="cls0">C. Every property and casualty insurer shall complete investigation of a claim within sixty (60) days after notification of proof of loss unless such investigation cannot reasonably be completed within such time. If such investigation cannot be completed, or if a property and casualty insurer needs more time to determine whether a claim should be accepted or denied, it shall so notify the claimant within sixty (60) days after receipt of the proofs of loss, giving reasons why more time is needed. If the investigation remains incomplete, a property and casualty insurer shall, within sixty (60) days from the date of the initial notification, send to such claimant a letter setting forth the reasons additional time is needed for investigation. Except for an investigation of possible fraud or arson which is supported by specific information giving a reasonable basis for the investigation, the time for investigation shall not exceed one hundred twenty (120) days after receipt of proof of loss. Provided, in the event of a weather-related catastrophe or a major natural disaster, as declared by the Governor, the Insurance Commissioner may extend this deadline for investigation an additional twenty (20) days.&nbsp;</span></p> <p><span class="cls0">D. Insurers shall not fail to settle first party claims on the basis that responsibility for payment should be assumed by others except as may otherwise be provided by policy provisions.&nbsp;</span></p> <p><span class="cls0">E. Insurers shall not continue or delay negotiations for settlement of a claim directly with a claimant who is neither an attorney nor represented by an attorney, for a length of time which causes the claimant's rights to be affected by a statute of limitations, or a policy or contract time limit, without giving the claimant written notice that the time limit is expiring and may affect the claimant's rights. Such notice shall be given to first party claimants thirty (30) days, and to third party claimants sixty (60) days, before the date on which such time limit may expire.&nbsp;</span></p> <p><span class="cls0">F. No insurer shall make statements which indicate that the rights of a third party claimant may be impaired if a form or release is not completed within a given period of time unless the statement is given for the purpose of notifying a third party claimant of the provision of a statute of limitations.&nbsp;</span></p> <p><span class="cls0">G. If a lawsuit on the claim is initiated, the time limits provided for in this section shall not apply.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 18, eff. Nov. 1, 1986. Amended by Laws 1987, c. 175, &sect; 11, eff. Nov. 1, 1987; Laws 1993, c. 248, &sect; 1, eff. Sept. 1, 1993; Laws 1994, c. 342, &sect; 7, eff. Sept. 1, 1994. Renumbered from &sect; 1256 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994; Laws 1997, c. 418, &sect; 54, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1250.8. Motor vehicle total loss or damage claim.&nbsp;</span></p> <p><span class="cls0">A. If an insurance policy or insurance contract provides for the adjustment and settlement of first party motor vehicle total losses, on the basis of actual cash value or replacement with another of like kind and quality, one of the following methods shall apply:&nbsp;</span></p> <p><span class="cls0">1. An insurer may elect to offer a replacement motor vehicle which is a specific comparable motor vehicle available to the insured, with all applicable taxes, license fees, and other fees incident to the transfer of evidence of ownership of the motor vehicle paid, at no cost to the insured other than any deductible provided in the policy. The offer and any rejection thereof shall be documented in the claim file; or&nbsp;</span></p> <p><span class="cls0">2. An insurer may elect a cash settlement based upon the actual cost, less any deductible provided in the policy, to purchase a comparable motor vehicle, including all applicable taxes, license fees and other fees incident to a transfer of evidence of ownership, or a comparable motor vehicle. Such cost may be determined by:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the cost of a comparable motor vehicle in the local market area when a comparable motor vehicle is currently or recently available in the prior ninety (90) days in the local market area,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;one of two or more quotations obtained by an insurer from two or more qualified dealers located within the local market area when a comparable motor vehicle is not available in the local market area, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the cost of a comparable motor vehicle as quoted in the latest edition of the National Automobile Dealers Association Official Used Car Guide or monthly edition of any other nationally recognized published guidebook.&nbsp;</span></p> <p><span class="cls0">B. If a first party motor vehicle total loss is settled on a basis which deviates from the methods described in subsection A of this section, the deviation shall be supported by documentation giving particulars of the condition of the motor vehicle. Any deductions from such cost, including, but not limited to, deduction for salvage, shall be measurable, discernible, itemized and specified as to dollar amount and shall be appropriate in amount. The basis for such settlement shall be fully explained to a first party claimant.&nbsp;</span></p> <p><span class="cls0">C. If liability for motor vehicle damages is reasonably clear, insurers shall not recommend that third party claimants make claims pursuant to the third party claimants' own policies solely to avoid paying claims pursuant to such insurer's insurance policy or insurance contract.&nbsp;</span></p> <p><span class="cls0">D. Insurers shall not require a claimant to travel unreasonably either to inspect a replacement motor vehicle, obtain a repair estimate or have the motor vehicle repaired at a specific repair shop.&nbsp;</span></p> <p><span class="cls0">E. Insurers shall, upon the request of a claimant, include the deductible of a first party claimant, if any, in subrogation demands. Subrogation recoveries shall be shared on a proportionate basis with a first party claimant, unless the deductible amount has been otherwise recovered. No deduction for expenses shall be made from a deductible recovery unless an outside attorney is retained to collect such recovery. The deduction shall then be made for only a pro rata share of the allocated loss adjustment expense.&nbsp;</span></p> <p><span class="cls0">F. If an insurer prepares an estimate of the cost of automobile repairs, such estimate shall be in an amount for which it reasonably may be expected that the damage can be repaired satisfactorily. An insurer shall give a copy of an estimate to a claimant and may furnish to the claimant the names of one or more conveniently located repair shops, if requested by the claimant.&nbsp;</span></p> <p><span class="cls0">G. If an amount claimed is reduced because of betterment or depreciation, all information for such reduction shall be contained in the claim file. Such deductions shall be itemized and specified as to dollar amount and shall be appropriate for the amount of deductions.&nbsp;</span></p> <p><span class="cls0">H. An insurer or its representative shall not require a claimant to obtain motor vehicle repairs at a specific repair facility. An insurer or its representative shall not require a claimant to obtain motor vehicle glass repair or replacement at a specific motor vehicle glass repair or replacement facility. An insurer shall fully and promptly pay for the cost of the motor vehicle repair services or products, less any applicable deductible amount payable according to the terms of the policy. The claimant shall be furnished an itemized priced statement of repairs by the repair facility at the time of acceptance of the repaired motor vehicle. Unless a cash settlement is made, if a claimant selects a motor vehicle repair or motor vehicle glass repair or replacement facility, the insurer shall provide payment to the facility or claimant based on a competitive price, as established by that insurer through market surveys or by the insured through competitive bids at the insured's option, to determine a fair and reasonable market price for similar services. Reasonable deviation from this market price is allowed based on the facts in each case.&nbsp;</span></p> <p><span class="cls0">I. An insurer shall not use as a basis for cash settlement with a first party claimant an amount which is less than the amount which an insurer would pay if repairs were made, other than in total loss situations, unless such amount is agreed to by the insured.&nbsp;</span></p> <p><span class="cls0">J. An insurer shall not force a claimant to execute a full settlement release in order to settle a property damage claim involving a personal injury.&nbsp;</span></p> <p><span class="cls0">K. All payment or satisfaction of a claim for a motor vehicle which has been transferred by title to the insurer shall be paid by check or draft, payable on demand.&nbsp;</span></p> <p><span class="cls0">L. In the event of payment of a total loss to a third party claimant, the insurer shall include any registered lienholder as copayee to the extent of the lienholder&rsquo;s interest.&nbsp;</span></p> <p><span class="cls0">M. As used in this section, "total loss" means that the vehicle repair costs plus the salvage value of the vehicle meets or exceeds the actual cash value of the motor vehicle prior to the loss, as provided in used automobile dealer guidebooks.&nbsp;</span></p> <p><span class="cls0">N. An insurer shall not offer a cash settlement as provided in paragraph 2 of subsection A of this section for the purchase of a comparable motor vehicle and then subsequently sell the motor vehicle which has been determined to be a total loss back to the claimant if the insurer has determined that the repair of the vehicle would not result in the vehicle being restored to operative condition as provided in Section 1111 of Title 47 of the Oklahoma Statutes unless the claimant specifies in writing or via an electronic signature that the claimant understands that the motor vehicle shall be titled as a &ldquo;junked vehicle&rdquo;.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 19, eff. Nov. 1, 1986. Amended by Laws 1987, c. 175, &sect; 12, eff. Nov. 1, 1987; Laws 1993, c. 225, &sect; 1, eff. Sept. 1, 1993; Laws 1994, c. 342, &sect; 8, eff. Sept. 1, 1994. Renumbered from &sect; 1257 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 2001, c. 363, &sect; 13, eff. July 1, 2001; Laws 2003, c. 358, &sect; 1, eff. Nov. 1, 2003; Laws 2010, c. 321, &sect; 1, eff. Nov. 1, 2010.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1250.9. Periodic reports.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">A. If the Insurance Commissioner determines, based on an investigation of complaints of unfair claim settlement practices, that an insurer, other than the State Insurance Fund, has engaged in unfair claim settlement practices with such frequency as to indicate a general business practice and that such insurer should be subjected to closer supervision with respect to such practices, the Commissioner may require the insurer to file a report at such periodic intervals as the Commissioner deems necessary. The Commissioner shall also devise a statistical plan for such periodic reports, which shall contain but not be limited to the following information:&nbsp;</span></p> <p><span class="cls0">1. The total number of written claims filed, including the original amount filed for by the insured and the classification by line of insurance of each individual written claim, for the past twelve-month period or from the date of the insurer's last periodic report, whichever time is shorter;&nbsp;</span></p> <p><span class="cls0">2. The total number of written claims denied, for the past twelve-month period or from the date of the insurer's last periodic report, whichever time is shorter;&nbsp;</span></p> <p><span class="cls0">3. The total number of written claims settled, including the original amount filed for by the insured, the settled amount, and the classification of line of insurance of each individual settled claim, for the past twelve-month period or from the date of the insurer's last periodic report, whichever time is shorter;&nbsp;</span></p> <p><span class="cls0">4. The total number of written claims for which lawsuits were instituted against the insurer, including the original amount of the claim filed for by the insured, the amount of final adjudication, the reason for the lawsuit and the classification by line of insurance of each individual written claim, for the past twelve-month period or from the date of the insurer's last periodic report, whichever time is shorter; and&nbsp;</span></p> <p><span class="cls0">5. All information required by paragraph 12 of Section 1250.5 of this title.&nbsp;</span></p> <p><span class="cls0">B. For the purposes of this section, "written claims" means those claims reduced to writing and filed by a resident of this state with an insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 7, emerg. eff. June 24, 1986. Amended by Laws 1992, c. 74, &sect; 3, eff. Sept. 1, 1992; Laws 1994, c. 342, &sect; 9, eff. Sept. 1, 1994. Renumbered from &sect; 1223 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 6, emerg. eff. Nov. 4, 1994.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">A. If the Insurance Commissioner determines, based on an investigation of complaints of unfair claim settlement practices, that an insurer has engaged in unfair claim settlement practices with such frequency as to indicate a general business practice and that such insurer should be subjected to closer supervision with respect to such practices, the Commissioner may require the insurer to file a report at such periodic intervals as the Commissioner deems necessary. The Commissioner shall also devise a statistical plan for such periodic reports, which shall contain but not be limited to the following information:&nbsp;</span></p> <p><span class="cls0">1. The total number of written claims filed, including the original amount filed for by the insured and the classification by line of insurance of each individual written claim, for the past twelve-month period or from the date of the insurer's last periodic report, whichever time is shorter;&nbsp;</span></p> <p><span class="cls0">2. The total number of written claims denied, for the past twelve-month period or from the date of the insurer's last periodic report, whichever time is shorter;&nbsp;</span></p> <p><span class="cls0">3. The total number of written claims settled, including the original amount filed for by the insured, the settled amount, and the classification of line of insurance of each individual settled claim, for the past twelve-month period or from the date of the insurer's last periodic report, whichever time is shorter;&nbsp;</span></p> <p><span class="cls0">4. The total number of written claims for which lawsuits were instituted against the insurer, including the original amount of the claim filed for by the insured, the amount of final adjudication, the reason for the lawsuit and the classification by line of insurance of each individual written claim, for the past twelve-month period or from the date of the insurer's last periodic report, whichever time is shorter; and&nbsp;</span></p> <p><span class="cls0">5. All information required by paragraph 12 of Section 1250.5 of this title.&nbsp;</span></p> <p><span class="cls0">B. For the purposes of this section, "written claims" means those claims reduced to writing and filed by a resident of this state with an insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 7, emerg. eff. June 24, 1986. Amended by Laws 1992, c. 74, &sect; 3, eff. Sept. 1, 1992; Laws 1994, c. 342, &sect; 9, eff. Sept. 1, 1994. Renumbered from &sect; 1223 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 6, emerg. eff. Nov. 4, 1994; Laws 2013, c. 254, &sect; 21, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1250.10. Enforcement - Standards of performance - Complaints - Investigations.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may hire additional employees and examiners as needed for the enforcement of the provisions of the Unfair Claims Settlement Practices Act.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner shall compile the information received from an insurer pursuant to Section 1250.9 of this title in such a manner as to enable him to compare it to a minimum standard of performance which shall be promulgated by the Commissioner. If the Commissioner, after such comparison is made, finds that the insurer falls below the minimum standard of performance, he shall cause an investigation to be made of said insurer as to the reason, if any, for the substandard performance.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner shall also provide for the receiving and processing of individual complaints alleging violations of the Unfair Claims Settlement Practices Act by both insurers who are required to make periodic reports and those who are not required to make such reports, but not by the State Insurance Fund. If the Commissioner in his complaint experience determines that the number and type of complaints against an insurer, other than the State Insurance Fund, do not meet the minimum standard of performance or are out of proportion to those against other insurers writing similar lines of insurance, the Commissioner shall cause an investigation to be made of the insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 8, emerg. eff. June 24, 1986. Amended by Laws 1994, c. 342, &sect; 10, eff. Sept. 1, 1994. Renumbered from &sect; 1224 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 7, emerg. eff. Nov. 4, 1994.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may hire additional employees and examiners as needed for the enforcement of the provisions of the Unfair Claims Settlement Practices Act.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner shall compile the information received from an insurer pursuant to Section 1250.9 of this title in such a manner as to enable him to compare it to a minimum standard of performance which shall be promulgated by the Commissioner. If the Commissioner, after such comparison is made, finds that the insurer falls below the minimum standard of performance, he shall cause an investigation to be made of said insurer as to the reason, if any, for the substandard performance.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner shall also provide for the receiving and processing of individual complaints alleging violations of the Unfair Claims Settlement Practices Act by both insurers who are required to make periodic reports and those who are not required to make such reports. If the Commissioner in his complaint experience determines that the number and type of complaints against an insurer do not meet the minimum standard of performance or are out of proportion to those against other insurers writing similar lines of insurance, the Commissioner shall cause an investigation to be made of the insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 8, emerg. eff. June 24, 1986. Amended by Laws 1994, c. 342, &sect; 10, eff. Sept. 1, 1994. Renumbered from &sect; 1224 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 7, emerg. eff. Nov. 4, 1994; Laws 2013, c. 254, &sect; 22, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1250.11. Statement of charges - Notice of hearing &ndash; State Insurance Fund exempted.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">A. Upon the receipt of the results of an investigation instituted pursuant to the provisions of Section 1250.10 of this title, the Insurance Commissioner shall review the results and shall determine whether, by the standards set out in Sections 1250.3 and 1250.5 of this title, further action is required. If the Insurance Commissioner deems further action necessary, the Commissioner shall issue and serve upon the insurer a statement of the charges and a notice in accordance with the Administrative Procedures Act. No insurer shall be deemed in violation of the Unfair Claims Settlement Practices Act solely by reason of the numbers and types of such complaints or claims.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner shall not assert enforcement jurisdiction pursuant to this section over the State Insurance Fund.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 9, emerg. eff. June 24, 1986. Amended by Laws 1994, c. 342, &sect; 11, eff. Sept. 1, 1994. Renumbered from &sect; 1225 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 8, emerg. eff. Nov. 4, 1994; Laws 1997, c. 418, &sect; 55, eff. Nov. 1, 1997.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">&sect;36-1250.11. Statement of charges - Notice of hearing.&nbsp;</span></p> <p><span class="cls0">Upon the receipt of the results of an investigation instituted pursuant to the provisions of Section 1250.10 of this title, the Insurance Commissioner shall review the results and shall determine whether, by the standards set out in Sections 1250.3 and 1250.5 of this title, further action is required. If the Insurance Commissioner deems further action necessary, the Commissioner shall issue and serve upon the insurer a statement of the charges and a notice in accordance with the Administrative Procedures Act. No insurer shall be deemed in violation of the Unfair Claims Settlement Practices Act solely by reason of the numbers and types of such complaints or claims.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 9, emerg. eff. June 24, 1986. Amended by Laws 1994, c. 342, &sect; 11, eff. Sept. 1, 1994. Renumbered from &sect; 1225 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 8, emerg. eff. Nov. 4, 1994; Laws 1997, c. 418, &sect; 55, eff. Nov. 1, 1997; Laws 2013, c. 254, &sect; 23, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1250.12. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-1250.13. Cease and desist order &ndash; Enforcement.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner, upon finding an insurer, other than the State Insurance Fund, in violation of any provision of the Unfair Claims Settlement Practices Act, shall issue a cease and desist order to said insurer directing it to stop such unlawful practices. If the insurer refuses or fails to comply with said order, the Commissioner shall have the authority to revoke or suspend the insurer's certificate of authority. The Commissioner shall also have the authority to limit, regulate, and control the insurer's line of business, the insurer's writing of policy forms or other particular forms, and the insurer's volume of its line of business or its writing of policy forms or other particular forms. The Commissioner shall use the above authority to the extent deemed necessary to obtain the insurer's compliance with the order. The Attorney General shall offer his assistance if requested by the Commissioner to enforce the Commissioner's orders.&nbsp;</span></p> <p><span class="cls0">B. Reasonable attorneys fees shall be awarded the Commissioner if judicial action is necessary for the enforcement of the orders. Such fees shall be based upon those prevailing in the community. Fees collected by the Commissioner without the assistance of the Attorney General shall be credited to the Insurance Commissioner's Revolving Fund. Fees collected by the Attorney General shall be credited to the Attorney General's Revolving Fund.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 10, emerg. eff. June 24, 1986. Amended by Laws 1994, c. 342, &sect; 13, eff. Sept. 1, 1994. Renumbered from &sect; 1226 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 9, emerg. eff. Nov. 4, 1994; Laws 1997, c. 418, &sect; 56, eff. Nov. 1, 1997.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner, upon finding an insurer in violation of any provision of the Unfair Claims Settlement Practices Act, shall issue a cease and desist order to said insurer directing it to stop such unlawful practices. If the insurer refuses or fails to comply with said order, the Commissioner shall have the authority to revoke or suspend the insurer's certificate of authority. The Commissioner shall also have the authority to limit, regulate, and control the insurer's line of business, the insurer's writing of policy forms or other particular forms, and the insurer's volume of its line of business or its writing of policy forms or other particular forms. The Commissioner shall use the above authority to the extent deemed necessary to obtain the insurer's compliance with the order. The Attorney General shall offer his assistance if requested by the Commissioner to enforce the Commissioner's orders.&nbsp;</span></p> <p><span class="cls0">B. Reasonable attorney fees shall be awarded the Commissioner if judicial action is necessary for the enforcement of the orders. Such fees shall be based upon those prevailing in the community. Fees collected by the Commissioner without the assistance of the Attorney General shall be credited to the Insurance Commissioner's Revolving Fund. Fees collected by the Attorney General shall be credited to the Attorney General's Revolving Fund.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 315, &sect; 10, emerg. eff. June 24, 1986. Amended by Laws 1994, c. 342, &sect; 13, eff. Sept. 1, 1994. Renumbered from &sect; 1226 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 9, emerg. eff. Nov. 4, 1994; Laws 1997, c. 418, &sect; 56, eff. Nov. 1, 1997; Laws 2013, c. 254, &sect; 24, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1250.14. Violation of act - Penalty.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">For any violation of the Unfair Claims Settlement Practices Act, the Insurance Commissioner may, after notice and hearing, subject an insurer, other than the State Insurance Fund, to a civil penalty of not less than One Hundred Dollars ($100.00) nor more than Five Thousand Dollars ($5,000.00) for each occurrence. Such civil penalty may be enforced in the same manner in which civil judgments may be enforced.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 20, eff. Nov. 1, 1986. Amended by Laws 1994, c. 342, &sect; 14, eff. Sept. 1, 1994. Renumbered from &sect; 1258 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 10, emerg. eff. Nov. 4, 1994; Laws 1997, c. 418, &sect; 57, eff. Nov. 1, 1997; Laws 2009, c. 432, &sect; 11, eff. July 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">For any violation of the Unfair Claims Settlement Practices Act, the Insurance Commissioner may, after notice and hearing, subject an insurer to a civil penalty of not less than One Hundred Dollars ($100.00) nor more than Five Thousand Dollars ($5,000.00) for each occurrence. Such civil penalty may be enforced in the same manner in which civil judgments may be enforced.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 20, eff. Nov. 1, 1986. Amended by Laws 1994, c. 342, &sect; 14, eff. Sept. 1, 1994. Renumbered from &sect; 1258 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994. Amended by Laws 1994, 2nd Ex. Sess., c. 1, &sect; 10, emerg. eff. Nov. 4, 1994; Laws 1997, c. 418, &sect; 57, eff. Nov. 1, 1997; Laws 2009, c. 432, &sect; 11, eff. July 1, 2009; Laws 2013, c. 254, &sect; 25, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1250.15. Judicial review.&nbsp;</span></p> <p><span class="cls0">Any insurer affected by an order of the Insurance Commissioner issued pursuant to the Unfair Claims Settlement Practices Act may seek judicial review of such order by filing a petition in the District Court of Oklahoma County within thirty (30) days after the insurer is notified of the order.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1994, c. 342, &sect; 15, eff. Sept. 1, 1994. Amended by Laws 1997, c. 418, &sect; 58, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1250.16. Rules and regulations.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner shall formulate, adopt and promulgate rules for the implementation and administration of the Unfair Claims Settlement Practices Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1986, c. 251, &sect; 22, eff. Nov. 1, 1986. Amended by Laws 1994, c. 342, &sect; 16, eff. Sept. 1, 1994. Renumbered from &sect; 1260 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1250.17. Nonemergency patient form - Perjury.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner shall develop, by rule, a form to be presented to patients by health care providers prior to rendering nonemergency services. The form shall be designed to seek information from the patient to further determine the eligibility of the patient for benefits under the patient&rsquo;s insurance policy. Making false statements on the form shall be regarded as willful misrepresentation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2009, c. 323, &sect; 3, eff. Nov. 1, 2009. Amended by Laws 2011, c. 278, &sect; 23, eff. Nov. 1, 2011.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1251. Repealed by Laws 1994, c. 342, &sect; 21, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361252. Renumbered as &sect; 1250.2 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361253. Renumbered as &sect; 1250.4 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361254. Renumbered as &sect; 1250.5 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;36-1255. Renumbered as &sect; 1250.6 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361256. Renumbered as &sect; 1250.7 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361257. Renumbered as &sect; 1250.8 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361258. Renumbered as &sect; 1250.14 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361259. Renumbered as &sect; 1250.12 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;361260. Renumbered as &sect; 1250.16 of this title by Laws 1994, c. 342, &sect; 20, eff. Sept. 1, 1994.&nbsp;</span></p> <p><span class="cls0">&sect;36-1421. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1422. Renumbered as &sect; 1435.2 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1423. Renumbered as &sect; 1435.3 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.1. Renumbered as &sect; 1435.33 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.2. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.11. Renumbered as &sect; 1435.20 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.12. Renumbered as &sect; 1435.34 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.13. Renumbered as &sect; 1435.32 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.14. Renumbered as &sect; 1435.21 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.15. Renumbered as &sect; 1435.35 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.16. Renumbered as &sect; 1435.36 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.17. Renumbered as &sect; 1435.37 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.18. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1424.19. Renumbered as &sect; 1435.38 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425. Renumbered as &sect; 1435.23 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.1. Renumbered as &sect; 1426A of this title by Laws 1997, c. 418, &sect; 127, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.2. Renumbered as &sect; 1435.24 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.3. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.4. Renumbered as &sect; 1435.25 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.5. Repealed by Laws 2009, c. 176, &sect; 59, eff. Nov. 1, 2009.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.6. Renumbered as &sect; 1435.26 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.7. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.8. Renumbered as &sect; 1435.39 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1425.9. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1426. Renumbered as &sect; 1435.10 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1426.1. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-1426A. Renumbered as &sect; 1435.29 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1427. Renumbered as &sect; 1435.30 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1427.1. Renumbered as &sect; 1435.31 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1428. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1429. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-1430. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1431. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1431.1. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1432. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1433. Repealed by Laws 2001, c. 156, &sect; 34, eff. Nov. 1, 2001.&nbsp;</span></p> <p><span class="cls0">&sect;36-1435.1. Short title - Application of act.&nbsp;</span></p> <p><span class="cls0">A. This act shall be known and may be cited as the "Oklahoma Producer Licensing Act".&nbsp;</span></p> <p><span class="cls0">B. This act governs the qualifications and procedures for the licensing of insurance producers. It simplifies and organizes statutory language to improve efficiency, permits the use of new technology, and reduces costs associated with issuing and renewing insurance licenses.&nbsp;</span></p> <p><span class="cls0">C. This act does not apply to excess and surplus lines agents and brokers licensed, except for Section 13 of this act and except where specifically referenced in this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 1, eff. Nov 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.2. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in the Oklahoma Producer Licensing Act:&nbsp;</span></p> <p><span class="cls0">1. "Commissioner" means the Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Business entity&rdquo; means a corporation, association, partnership, limited liability company, limited partnership, or other legal entity;&nbsp;</span></p> <p><span class="cls0">3. &ldquo;Customer service representative&rdquo; means an individual appointed by an insurance producer, surplus lines insurance broker, managing general agent, or insurance agency to assist the insurance producer, broker, or agency in transacting the business of insurance from the office of the insurance producer, broker, or agency and whose salary may vary based on the production or volume of applications or premiums;&nbsp;</span></p> <p><span class="cls0">4. &ldquo;Home state&rdquo; means the District of Columbia and any state or territory of the United States in which an insurance producer maintains the producer&rsquo;s principal place of residence or principal place of business and is licensed to act as an insurance producer;&nbsp;</span></p> <p><span class="cls0">5. &ldquo;Insurance&rdquo; means any of the lines of authority in Title 36 of the Oklahoma Statutes, including workers&rsquo; compensation insurance. Any insurer approved to offer workers&rsquo; compensation equivalent insurance pursuant to the provisions of Section 65 of Title 85 of the Oklahoma Statutes may appoint property and casualty insurance producers. All producers appointed for workers&rsquo; compensation equivalent insurance products must be licensed as property and casualty insurance producers by the Oklahoma Insurance Department;&nbsp;</span></p> <p><span class="cls0">6. "Insurance consultant" means an individual or legal entity who, for a fee, is held out to the public as engaged in the business of offering any advice, counsel, opinion or service with respect to the benefits, advantages, or disadvantages promised under any policy of insurance that could be issued or delivered in this state;&nbsp;</span></p> <p><span class="cls0">7. &ldquo;Insurance producer&rdquo; means a person required to be licensed under the laws of this state to sell, solicit or negotiate insurance. Any person not duly licensed as an insurance producer, surplus lines insurance broker, or limited lines producer who solicits a policy of insurance on behalf of an insurer shall be deemed to be acting as an insurance agent within the meaning of the Oklahoma Producer Licensing Act, and shall thereby become liable for all the duties, requirements, liabilities, and penalties to which an insurance producer of the company is subject, and the company by issuing the policy of insurance shall thereby accept and acknowledge the person as its agent in the transaction. For purposes of the laws of this state and the Oklahoma Insurance Code, the term &ldquo;insurance agent&rdquo; shall have the same meaning as the term &ldquo;insurance producer&rdquo;;&nbsp;</span></p> <p><span class="cls0">8. &ldquo;Insurer&rdquo; has the meaning set out in Section 103 of this title;&nbsp;</span></p> <p><span class="cls0">9. &ldquo;License&rdquo; means a document issued by the Insurance Commissioner of this state authorizing a person to act as an insurance producer for the lines of authority specified in the document. The license itself does not create any authority, actual, apparent or inherent, in the holder to represent or commit an insurance carrier;&nbsp;</span></p> <p><span class="cls0">10. &ldquo;Limited line credit insurance&rdquo; includes credit life, credit disability, credit property, credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, guaranteed automobile protection insurance, known as &ldquo;gap&rdquo; insurance, and any other form of insurance offered in connection with an extension of credit that is limited to partially or wholly extinguishing that credit obligation that the Insurance Commissioner determines should be designated a form of limited line credit insurance;&nbsp;</span></p> <p><span class="cls0">11. &ldquo;Limited line credit insurance producer&rdquo; means a person who sells, solicits or negotiates one or more forms of limited line credit insurance coverage to individuals through a master, corporate, group or individual policy;&nbsp;</span></p> <p><span class="cls0">12. &ldquo;Limited lines insurance&rdquo; means limited line credit and those lines of insurance defined in Section 20 of this act or any other line of insurance the Insurance Commissioner deems necessary to recognize for the purposes of complying with subsection E of Section 9 of this act;&nbsp;</span></p> <p><span class="cls0">13. "Limited lines producer" means a person who is authorized by the Commissioner to sell, solicit or negotiate limited lines insurance. For purposes of the laws of this state and the Oklahoma Insurance Code, the term &ldquo;limited insurance representative&rdquo; shall have the same meaning as the term &ldquo;limited lines producer&rdquo;;&nbsp;</span></p> <p><span class="cls0">14. "Managing general agent" means an individual or legal entity appointed, as an independent contractor, by one or more insurers to exercise general supervision over the business of the insurer in this state, with authority to appoint insurance producers for the insurer, and to terminate appointments for the insurer;&nbsp;</span></p> <p><span class="cls0">15. &ldquo;Negotiate&rdquo; means the act of conferring directly with or offering advice directly to a purchaser or prospective purchaser of a particular contract of insurance concerning any of the substantive benefits, terms or conditions of the contract, provided that the person engaged in that act either sells insurance or obtains insurance from insurers for purchaser;&nbsp;</span></p> <p><span class="cls0">16. &ldquo;Person&rdquo; means an individual or a business entity;&nbsp;</span></p> <p><span class="cls0">17. &ldquo;Sell&rdquo; means to exchange a contract of insurance, by any means, for money or its equivalent, on behalf of an insurance company;&nbsp;</span></p> <p><span class="cls0">18. &ldquo;Solicit&rdquo; means attempting to sell insurance or asking or urging a person to apply for a particular kind of insurance from a particular company;&nbsp;</span></p> <p><span class="cls0">19. "Surplus lines insurance broker" means an individual or legal entity who solicits, negotiates, or procures a policy of insurance in an insurance company not licensed to transact business in this state which cannot be procured from insurers licensed to do business in this state. All transactions under such license shall be subject to Article 11 of the Oklahoma Insurance Code;&nbsp;</span></p> <p><span class="cls0">20. &ldquo;Terminate&rdquo; means the cancellation of the relationship between an insurance producer and the insurer or the termination of a producer&rsquo;s authority to transact insurance;&nbsp;</span></p> <p><span class="cls0">21. &ldquo;Uniform Business Entity Application&rdquo; means the current version of the National Association of Insurance Commissioners (NAIC) Uniform Business Entity Application for resident and nonresident business entities; and&nbsp;</span></p> <p><span class="cls0">22. &ldquo;Uniform Application&rdquo; means the current version of the NAIC Uniform Application for resident and nonresident producer licensing.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1980, c. 164, &sect; 2, emerg. eff. April 15, 1980. Amended by Laws 1995, c. 339, &sect; 17, eff. Nov. 1, 1995; Laws 1997, c. 418, &sect; 59, eff. Nov. 1, 1997; Laws 2001, c. 156, &sect; 3, eff. Nov. 1, 2001. Renumbered from Title 36, &sect; 1422 by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;361435.3. Agency of insurance producer Authority - Commissions.&nbsp;</span></p> <p><span class="cls0">A. Every insurance producer, customer service representative, or limited lines producer who solicits or negotiates an application for insurance of any kind shall, in any controversy between the insured or the insured's beneficiary and the insurer, be regarded as representing the insurer and not the insured or the insured's beneficiary. This provision shall not affect the apparent authority of an insurance producer.&nbsp;</span></p> <p><span class="cls0">B. Every surplus lines insurance broker who solicits an application for insurance of any kind shall, in any controversy between the insured or the insured's beneficiary and the insurer issuing any policy upon such application, be regarded as representing the insured or the insured's beneficiary and not the insurer. Any company which directly or through its agents delivers in this state to any insurance broker, a policy of insurance pursuant to the application or request of such broker, acting for an insured other than himself or herself, shall be deemed to have authorized such broker to receive on its behalf, payment of any premium which is due on such policy of insurance at the time of its issuance or delivery.&nbsp;</span></p> <p><span class="cls0">C. Every licensed insurance producer shall be entitled to commissions on all premiums collected for group insurance policies negotiated by the insurance producer on behalf of an insurer and an insurer shall be required to pay such commissions to the insurance producer, except entitlement to commissions shall automatically terminate without notice, effective on the date of the occurrence of any of the following events:&nbsp;</span></p> <p><span class="cls0">1. The insurance producer&rsquo;s license to engage in accident and health insurance business is terminated or revoked by the State of Oklahoma or any other public authority for cause. As used in this paragraph, "cause" shall be defined as perpetration by the insurance producer of fraud or embezzlement;&nbsp;</span></p> <p><span class="cls0">2. Material breach of the insurance producer&rsquo;s contract with the account or insurer, excluding production requirements;&nbsp;</span></p> <p><span class="cls0">3. Termination of the insurance producer&rsquo;s "Agent of Record" relationship with the employer or account; or&nbsp;</span></p> <p><span class="cls0">4. Death of the insurance producer, unless the contract between the insurer states otherwise or the right to the commission has vested.&nbsp;</span></p> <p><span class="cls0">Recovery of such commissions shall be through civil action. In any action brought pursuant to this subsection, the court may award reasonable attorneys fees to the prevailing party.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1980, c. 164, &sect; 3, emerg. eff. April 15, 1980. Amended by Laws 1992, c. 261, &sect; 2, eff. Sept. 1, 1992; Laws 1996, c. 246, &sect; 2, eff. July 1, 1996; Laws 2001, c. 156, &sect; 3, eff. Nov. 1, 2001. Renumbered from &sect; 1423 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.4. License required for selling, soliciting, or negotiating - Waiver of penalty.&nbsp;</span></p> <p><span class="cls0">A. A person shall not sell, solicit, or negotiate insurance in this state for any class or classes of insurance unless the person is licensed for that line of authority in accordance with the Oklahoma Producer Licensing Act.&nbsp;</span></p> <p><span class="cls0">B. A penalty for selling, soliciting, negotiating, or procuring surplus lines insurance in this state without a surplus lines broker license shall be waived if the Insurance Commissioner receives an application for licensure as a surplus lines broker within thirty (30) days from the effective date of the policy at issue.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 4, eff. Nov. 1, 2001. Amended by Laws 2008, c. 184, &sect; 8, eff. July 1, 2008.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.5. When license not required.&nbsp;</span></p> <p><span class="cls0">A. Nothing in the Oklahoma Producer Licensing Act shall be construed to require an insurer to obtain an insurance producer license. In this section, the term "insurer" does not include an insurer's officers, directors, employees, subsidiaries or affiliates.&nbsp;</span></p> <p><span class="cls0">B. A license as an insurance producer shall not be required of the following:&nbsp;</span></p> <p><span class="cls0">1. An officer, director or employee of an insurer or of an insurance producer, provided that the officer, director or employee does not receive any commission on policies written or sold to insure risks residing, located or to be performed in this state, and:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the officer, director or employee's activities are executive, administrative, managerial, clerical or a combination of these, and are only indirectly related to the sale, solicitation or negotiation of insurance, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the officer, director or employee's function relates to underwriting, loss control, inspection or the processing, adjusting, investigating or settling of a claim on a contract of insurance, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the officer, director or employee is acting in the capacity of a special agent or agency supervisor assisting insurance producers where the person's activities are limited to providing technical advice and assistance to licensed insurance producers and do not include the sale, solicitation or negotiation of insurance;&nbsp;</span></p> <p><span class="cls0">2. A person who secures and furnishes information for the purpose of group life insurance, group property and casualty insurance, group annuities, group or blanket accident and health insurance; or for the purpose of enrolling individuals under plans, issuing certificates under plans or otherwise assisting in administering plans; or performs administrative services related to mass-marketed property and casualty insurance, where no commission is paid to the person for the service;&nbsp;</span></p> <p><span class="cls0">3. An employer or association or its officers, directors, employees, or the trustees of an employee trust plan, to the extent that the employers, officers, employees, director or trustees are engaged in the administration or operation of a program of employee benefits for the employer's or association's own employees or the employees of its subsidiaries or affiliates, which program involves the use of insurance issued by an insurer, as long as the employers, associations, officers, directors, employees or trustees are not in any manner compensated, directly or indirectly, by the company issuing the contracts;&nbsp;</span></p> <p><span class="cls0">4. Employees of insurers or organizations employed by insurers who are engaging in the inspection, rating or classification of risks, or in the supervision of the training of insurance producers and who are not individually engaged in the sale, solicitation or negotiation of insurance;&nbsp;</span></p> <p><span class="cls0">5. A person whose activities in this state are limited to advertising without the intent to solicit insurance in this state through communications in printed publications or other forms of electronic mass media whose distribution is not limited to residents of the state, provided that the person does not sell, solicit or negotiate insurance that would insure risks residing, located or to be performed in this state;&nbsp;</span></p> <p><span class="cls0">6. A person who is not a resident of this state who sells, solicits or negotiates a contract of insurance for commercial property and casualty risks to an insured with risks located in more than one state insured under that contract, provided that that person is otherwise licensed as an insurance producer to sell, solicit or negotiate that insurance in the state where the insured maintains its principal place of business and the contract of insurance insures risks located in that state;&nbsp;</span></p> <p><span class="cls0">7. A salaried full-time employee who counsels or advises his or her employer relative to the insurance interests of the employer or of the subsidiaries or business affiliates of the employer, provided that the employee does not sell or solicit insurance or receive a commission; or&nbsp;</span></p> <p><span class="cls0">8. A volunteer counselor assisting Medicare beneficiaries with enrollment in Medicare Part D plans pursuant to the Federal Medicare Prescription Drug, Improvement and Modernization Act of 2003, Pub. Law No. 108-173, provided that the volunteer counselor does not receive commissions or other valuable consideration from any person or plan for the enrollment, that the volunteer counselor has received education that is acceptable to the Insurance Commissioner on enrollment of Medicare beneficiaries in Medicare Part D, that the volunteer counselor is providing volunteer services as part of a sponsoring agency or organization acceptable to the Commissioner, and that supporting documentation and/or verification is provided to the Commissioner as set out by rule.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 5, eff. Nov. 1, 2001. Amended by Laws 2008, c. 184, &sect; 9, eff. July 1, 2008.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.6. Examinations.&nbsp;</span></p> <p><span class="cls0">A. A resident individual applying for an insurance producer license shall pass a written examination unless exempt pursuant to Section 1435.10 of this title. The examination shall test the knowledge of the individual concerning the lines of authority for which application is made, the duties and responsibilities of an insurance producer and the insurance laws and regulations of this state. Examinations required by this section shall be developed and conducted under rules and regulations prescribed by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner may make arrangements, including contracting with an outside testing service, for administering examinations and collecting the nonrefundable fee set forth in Section 1435.23 of this title.&nbsp;</span></p> <p><span class="cls0">C. Each individual applying for an examination shall remit a nonrefundable fee as prescribed by the Insurance Commissioner as set forth in Section 1435.23 of this title.&nbsp;</span></p> <p><span class="cls0">D. Prior to completion and filing of the application, the Insurance Commissioner shall subject each applicant for license as an insurance producer, insurance consultant, limited insurance representative, or customer service representative to an examination approved by the Commissioner as to competence to act as a licensee, which each applicant shall personally take and pass to the satisfaction of the Commissioner except as provided in Section 1435.10 of this title. The Commissioner may accept examinations administered by a testing service as satisfying the examination requirements of persons seeking license as agents, solicitors, counselors, or adjusters under the Oklahoma Insurance Code. The Commissioner may negotiate agreements with such testing services to include performance of examination development, test scheduling, examination site arrangements, test administration, grading, reporting, and analysis. The Commissioner may require such testing services to correspond directly with the applicants with regard to the administration of such examinations and that such testing services collect fees for administering such examinations directly from the applicants. The Commissioner may stipulate that any agreements with such testing services provide for the administration of examinations in specific locales and at specified frequencies. The Commissioner shall retain the authority to establish the scope and type of all examinations.&nbsp;</span></p> <p><span class="cls0">E. If the applicant is a legal entity, the examination shall be taken by each individual who is to act for the entity as a licensee.&nbsp;</span></p> <p><span class="cls0">F. Each examination for a license shall be approved for use by the Commissioner and shall reasonably test the knowledge of the applicant as to the lines of insurance, policies, and transactions to be handled pursuant to the license applied for, the duties and responsibilities of the licensee, and the pertinent insurance laws of this state.&nbsp;</span></p> <p><span class="cls0">G. Examination for licensing shall be at such reasonable times and places as are designated by the Commissioner.&nbsp;</span></p> <p><span class="cls0">H. The Commissioner or testing service shall give, conduct, and grade all examinations in a fair and impartial manner and without discrimination among individuals examined.&nbsp;</span></p> <p><span class="cls0">I. The applicant shall pass the examination with a grade determined by the Commissioner to indicate satisfactory knowledge and understanding of the line or lines of insurance for which the applicant seeks qualification. Within ten (10) days after the examination, the Commissioner shall inform the applicant and the appointing insurer, when applicable, as to whether or not the applicant has passed. An application for licensure shall be made within two (2) years after passing the examination.&nbsp;</span></p> <p><span class="cls0">J. An applicant who has failed to pass the examination for the license applied for may take the examination subsequent times. Examination fees for subsequent examinations shall not be waived.&nbsp;</span></p> <p><span class="cls0">K. An applicant for a license as a resident surplus lines broker shall have passed the property and casualty insurance examination on the line or lines of insurance to be written to qualify for a surplus lines broker license.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 6, eff. Nov. 1, 2001. Amended by Laws 2002, c. 307, &sect; 13, eff. Nov. 1, 2002; Laws 2004, c. 274, &sect; 8, eff. July 1, 2004; Laws 2006, c. 264, &sect; 44, eff. July 1, 2006; Laws 2009, c. 176, &sect; 24, eff. Nov. 1, 2009; Laws 2011, c. 242, &sect; 2 and Laws 2011, c. 293, &sect; 2, eff. June 20, 2011; Laws 2012, c. 44, &sect; 3, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 242, &sect; 2 and Laws 2011, c. 293, &sect; 2 made identical changes to this section.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1435.7. Applications for resident and business entity insurance producer licenses - Requirements for approval.&nbsp;</span></p> <p><span class="cls0">A. A person applying for a resident insurance producer license shall make application to the Insurance Commissioner on the Uniform Application or an application approved by the Commissioner and declare under penalty of refusal, suspension or revocation of the license that the statements made in the application are true, correct and complete to the best of the individual's knowledge and belief. Before approving the application, the Insurance Commissioner shall find that the individual:&nbsp;</span></p> <p><span class="cls0">1. Is at least eighteen (18) years of age;&nbsp;</span></p> <p><span class="cls0">2. Has not committed any act that is a ground for denial, suspension or revocation set forth in Section 1435.13 of this title;&nbsp;</span></p> <p><span class="cls0">3. Has paid the fees set forth in Section 1435.23 of this title; and&nbsp;</span></p> <p><span class="cls0">4. Has successfully passed the examinations for the lines of authority for which the person has applied.&nbsp;</span></p> <p><span class="cls0">B. A business entity acting as an insurance producer is required to obtain an insurance producer license. Application shall be made using the Uniform Business Entity Application or an application approved by the Commissioner. Before approving the application, the Insurance Commissioner shall find that:&nbsp;</span></p> <p><span class="cls0">1. The business entity has paid the fees set forth in Section 1435.23 of this title;&nbsp;</span></p> <p><span class="cls0">2. The business entity has designated a licensed producer responsible for the business entity's compliance with the insurance laws, rules and regulations of this state;&nbsp;</span></p> <p><span class="cls0">3. A domestic business entity is organized pursuant to the provisions of the laws of this state and maintains its principal place of business in this state; and&nbsp;</span></p> <p><span class="cls0">4. No person whose license as an insurance producer has been revoked by order of the Commissioner, nor any business entity in which such person has a majority ownership interest, whether direct or indirect, owns any interest in the business entity licensed as an insurance producer.&nbsp;</span></p> <p><span class="cls0">C. An applicant for any license required by the provisions of the Oklahoma Producer Licensing Act shall demonstrate to the Insurance Commissioner that the applicant is competent, trustworthy, financially responsible, and of good personal and business reputation.&nbsp;</span></p> <p><span class="cls0">D. The Insurance Commissioner may require any documents reasonably necessary to verify the information contained in an application.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 7, eff. Nov. 1, 2001. Amended by 2002, c. 307, &sect; 14, eff. Nov. 1, 2002; Laws 2003, c. 150, &sect; 3, eff. Nov. 1, 2003; Laws 2007, c. 125, &sect; 10, eff. July 1, 2007; Laws 2007, c. 338, &sect; 3, eff. July 1, 2007; Laws 2008, c. 184, &sect; 10, eff. July 1, 2008; Laws 2009, c. 176, &sect; 25, eff. Nov. 1, 2009; Laws 2011, c. 242, &sect; 3 and Laws 2011, c. 293, &sect; 3, eff. June 20, 2011.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 242, &sect; 3 and Laws 2011, c. 293, &sect; 3 made identical changes to this section.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.7A. Repealed by Laws 2011, c. 242, &sect; 18 and by Laws 2011, c. 293, &sect; 18, eff. June 20, 2011.&nbsp;</span></p> <p><span class="cls0">&sect;36-1435.8. Lines of authority - Continuation in effect of license - Reinstatement - Contracting by Insurance Commissioner with nongovernmental entities.&nbsp;</span></p> <p><span class="cls0">A. Unless denied licensure pursuant to Section 1435.13 of this title, persons who have met the requirements of Sections 1435.6 and 1435.7 of this title shall be issued an insurance producer license. An insurance producer may receive qualification for a license in one or more of the following lines of authority:&nbsp;</span></p> <p><span class="cls0">1. Life - insurance coverage on human lives including benefits of endowment and annuities, and may include benefits in the event of death or dismemberment by accident and benefits for disability income;&nbsp;</span></p> <p><span class="cls0">2. Accident and health or sickness - insurance coverage for sickness, bodily injury or accidental death and may include benefits for disability income;&nbsp;</span></p> <p><span class="cls0">3. Property - insurance coverage for the direct or consequential loss or damage to property of every kind;&nbsp;</span></p> <p><span class="cls0">4. Casualty - insurance coverage against legal liability, including that for death, injury or disability or damage to real or personal property;&nbsp;</span></p> <p><span class="cls0">5. Variable life and variable annuity products - insurance coverage provided under variable life insurance contracts and variable annuities;&nbsp;</span></p> <p><span class="cls0">6. Personal lines - property and casualty insurance coverage sold to individuals and families for primarily noncommercial purposes;&nbsp;</span></p> <p><span class="cls0">7. Commercial lines &ndash; property and casualty insurance coverage sold to businesses for primarily commercial purposes;&nbsp;</span></p> <p><span class="cls0">8. Credit - limited line credit insurance;&nbsp;</span></p> <p><span class="cls0">9. Title insurance &ndash; insurance coverage that insures or guarantees the title to real or personal property or any interest therein or encumbrance thereon;&nbsp;</span></p> <p><span class="cls0">10. Aircraft title insurance &ndash; insurance coverage that protects an aircraft owner or lender against loss of the aircraft or priority security position in the event of a successful adverse claim on the title to an aircraft; and&nbsp;</span></p> <p><span class="cls0">11. Any other line of insurance permitted under state laws or regulations.&nbsp;</span></p> <p><span class="cls0">B. An insurance producer license shall remain in effect unless revoked or suspended as long as the fee set forth in Section 1435.23 of this title is paid and education requirements for resident individual producers are met by the due date.&nbsp;</span></p> <p><span class="cls0">C. An individual insurance producer who allows the license to lapse may, within twelve (12) months from the due date of the renewal fee, reinstate the same license without the necessity of passing a written examination unless the license was revoked, suspended, or continuation thereof was refused by the Commissioner. However, a penalty in the amount of double the unpaid renewal fee shall be required for any renewal fee received after the due date. Continuing education requirements must be kept current.&nbsp;</span></p> <p><span class="cls0">D. A licensed insurance producer who is unable to comply with license renewal procedures due to military service or some other extenuating circumstance, such as a long-term medical disability, may request a waiver of those procedures. The producer may also request a waiver of any examination requirement or any other fine or sanction imposed for failure to comply with renewal procedures.&nbsp;</span></p> <p><span class="cls0">E. The license shall contain the licensee's name, address, personal identification number, and the date of issuance, the lines of authority, the expiration date and any other information the Insurance Commissioner deems necessary.&nbsp;</span></p> <p><span class="cls0">F. Licensees shall inform by any means acceptable to the Insurance Commissioner of a change of legal name, address, or e-mail address within thirty (30) days of the change to permit the Insurance Commissioner to give proper notice to licensees. A change in legal name or address submitted more than thirty (30) days after the change must include an administrative fee of Fifty Dollars ($50.00). Failure to provide acceptable notification of a change of legal name or address to the Insurance Commissioner within forty-five (45) days of the date the administrative fee is assessed shall result in penalties pursuant to Section 1435.13 of this title.&nbsp;</span></p> <p><span class="cls0">G. In order to assist in the performance of the Insurance Commissioner's duties, the Insurance Commissioner may contract with nongovernmental entities, including the National Association of Insurance Commissioners (NAIC) or any affiliates or subsidiaries that the NAIC oversees, to perform any ministerial functions, including the collection of fees, related to producer licensing that the Insurance Commissioner and the nongovernmental entity may deem appropriate.&nbsp;</span></p> <p><span class="cls0">H. The Commissioner may participate, in whole or in part, with the National Association of Insurance Commissioners, or any affiliates or subsidiaries the National Association of Insurance Commissioners oversees, in a centralized producer license registry where insurance producer licenses and appointments may be centrally or simultaneously effected for all states that require an insurance producer license and participate in such centralized producer license registry. If the Commissioner finds that participation in such a centralized producer license registry is in the public interest, the Commissioner may adopt by rule any uniform standards or procedures as are necessary to participate in the registry. This includes the central collection of all fees for licenses or appointments that are processed through the registry.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 8, eff. Nov. 1, 2001. Amended by Laws 2002, c. 307, &sect; 15, eff. Nov. 1, 2002; Laws 2006, c. 264, &sect; 45, eff. July 1, 2006; Laws 2009, c. 176, &sect; 26, eff. Nov. 1, 2009; Laws 2011, c. 242, &sect; 4 and Laws 2011, c. 293, &sect; 4, eff. June 20, 2011.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 242, &sect; 4 and Laws 2011, c. 293, &sect; 4 made identical changes to this section.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.9. Nonresident producer license.&nbsp;</span></p> <p><span class="cls0">A. Unless denied licensure pursuant to Section 1435.13 of this title, a nonresident person shall receive a nonresident producer license if:&nbsp;</span></p> <p><span class="cls0">1. The person is currently licensed as a resident and in good standing in that person's home state;&nbsp;</span></p> <p><span class="cls0">2. The person has submitted the proper request for licensure and has paid the fees required by Section 1435.23 of this title;&nbsp;</span></p> <p><span class="cls0">3. The person has submitted or transmitted to the Insurance Commissioner the application for licensure that the person submitted to the person's home state, or in lieu of the same, a completed Uniform Application; and&nbsp;</span></p> <p><span class="cls0">4. The person's home state awards nonresident producer licenses to residents of this state on the same basis.&nbsp;</span></p> <p><span class="cls0">B. Any nonresident application submitted pursuant to this section shall constitute the applicant&rsquo;s designation of the Insurance Commissioner as the person upon whom may be served all lawful process in any action, suit, or proceeding instituted by or on behalf of any interested person arising out of the insurance business of the applicant in this state. This designation constitutes an agreement that said service of process is of the same legal force and validity as personal service of process in this state upon the nonresident licensee.&nbsp;</span></p> <p><span class="cls0">C. The Insurance Commissioner may verify the producer's licensing status through the Producer Database maintained by the National Association of Insurance Commissioners, its affiliates or subsidiaries.&nbsp;</span></p> <p><span class="cls0">D. A nonresident producer who moves from one state to another state or a resident producer who moves from this state to another state shall file a change of address and provide certification from the new resident state within thirty (30) days of the change of legal residence.&nbsp;</span></p> <p><span class="cls0">E. Notwithstanding any other provision of the Oklahoma Producer Licensing Act or of the Oklahoma Insurance Code, a person licensed as a surplus lines producer in that person's home state shall receive a nonresident surplus lines producer license pursuant to subsections A and B of this section.&nbsp;</span></p> <p><span class="cls0">F. Notwithstanding any other provision of the Oklahoma Producer Licensing Act, a person licensed as a limited line credit insurance or other type of limited lines producer in that person's home state shall receive a nonresident limited lines producer license, pursuant to subsections A and B of this section, granting the same scope of authority as granted under the license issued by the producer's home state. For the purpose of this subsection, limited line insurance is any authority granted by the home state which restricts the authority of the license to less than the total authority prescribed in the associated major lines pursuant to subsection A of Section 1435.8 of this title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 9, eff. Nov. 1, 2001. Amended by Laws 2002, c. 307, &sect; 16, eff. Nov. 1, 2002; Laws 2008, c. 184, &sect; 11, eff. July 1, 2008.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.10. Exemptions from examination requirement.&nbsp;</span></p> <p><span class="cls0">A. The following are exempt from the requirement for an examination, if the Insurance Commissioner determines, in accordance with rules adopted by the Commissioner, that the applicant is cognizant of and capable of fulfilling the responsibilities of the license:&nbsp;</span></p> <p><span class="cls0">1. Any limited lines producer; and&nbsp;</span></p> <p><span class="cls0">2. A title insurance producer licensed prior to November 1, 2006, who is an applicant for an aircraft title producer license.&nbsp;</span></p> <p><span class="cls0">B. A person licensed as an insurance producer in another state who moves to this state shall make application to become a resident licensee within ninety (90) days of establishing legal residence in Oklahoma. No examination or continuing education shall be required of that person to obtain resident licensing for any line of authority held by the licensee in the prior state on the date legal residency was established in this state, except where the Insurance Commissioner determines otherwise by regulation.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1980, c. 164, &sect; 6, emerg. eff. April 15, 1980. Amended by Laws 1983, c. 90, &sect; 4, emerg. eff. May 9, 1983; Laws 1985, c. 258, &sect; 3, eff. Nov. 1, 1985; Laws 1997, c. 418, &sect; 79, eff. Nov. 1, 1997; Laws 2001, c. 156, &sect; 10, eff. Nov. 1, 2001. Renumbered from &sect; 1426 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001. Amended by Laws 2006, c. 264, &sect; 46, eff. July 1, 2006; Laws 2009, c. 176, &sect; 27, eff. Nov. 1, 2009.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.11. Use of assumed name.&nbsp;</span></p> <p><span class="cls0">An insurance producer doing business under any name other than the producer's legal name is required to notify the Insurance Commissioner prior to using the assumed name.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 11, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.12. Temporary license without examination &ndash; Protection of insureds and public.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may issue a temporary license for a period not to exceed one hundred eighty (180) days without requiring an examination if the Insurance Commissioner deems that the temporary license is necessary for the servicing of an insurance business in the following cases:&nbsp;</span></p> <p><span class="cls0">1. To the surviving spouse or court-appointed personal representative of a licensed insurance producer who dies or becomes mentally or physically disabled to allow adequate time for the sale of the insurance business owned by the producer or for the recovery or return of the producer to the business or to provide for the training and licensing of new personnel to operate the producer's business;&nbsp;</span></p> <p><span class="cls0">2. To a member or employee of a business entity licensed as an insurance producer, upon the death or disability of an individual designated in the business entity application or the license;&nbsp;</span></p> <p><span class="cls0">3. To the designee of a licensed insurance producer entering active service in the Armed Forces of the United States of America; or&nbsp;</span></p> <p><span class="cls0">4. In any other circumstance in which the Insurance Commissioner deems that the public interest will best be served by the issuance of this license.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner may by order limit the authority of any temporary licensee in any way deemed necessary to protect insureds and the public. The Insurance Commissioner may require the temporary licensee to have a suitable sponsor who is a licensed producer or insurer and who assumes responsibility for all acts of the temporary licensee and may impose other similar requirements designed to protect insureds and the public. The Insurance Commissioner may by order revoke a temporary license if the interest of insureds or the public are endangered. A temporary license may not continue after the owner or the personal representative disposes of the business. If the applicant fails to pass the licensure examination, the temporary license shall terminate automatically.&nbsp;</span></p> <p><span class="cls0">C. As to a temporary agent's license issued because of the death or disability of an agent, no insurers shall be represented by the temporary licensee in addition to those represented by the deceased or disabled agent.&nbsp;</span></p> <p><span class="cls0">D. The fee paid for the temporary license shall not be applied upon the fee for any permanent license of the same category issued to the licensee before expiration of the temporary license.&nbsp;</span></p> <p><span class="cls0">E. No license issued pursuant to the provisions of subsection A of this section shall be effective for more than six (6) months. The Commissioner, in his discretion, may renew the license once upon proper application and for good cause. However, no temporary license shall be issued for any line of insurance to any applicant who has failed to pass the required examination.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 12, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.13. Suspension, revocation or refusal to issue or renew license &ndash; Probation and censure &ndash; Grounds &ndash; Notice &ndash; Fines.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner may place on probation, censure, suspend, revoke or refuse to issue or renew a license issued pursuant to the Oklahoma Producer Licensing Act or may levy a civil penalty in accordance with subsection D of this section or any combination of actions, for any one or more of the following causes:&nbsp;</span></p> <p><span class="cls0">1. Providing incorrect, misleading, incomplete or materially untrue information in the license application;&nbsp;</span></p> <p><span class="cls0">2. Violating any insurance laws, or violating any regulation, subpoena or order of the Insurance Commissioner or of another state&rsquo;s Insurance Commissioner;&nbsp;</span></p> <p><span class="cls0">3. Obtaining or attempting to obtain a license through misrepresentation or fraud;&nbsp;</span></p> <p><span class="cls0">4. Improperly withholding, misappropriating or converting any monies or properties received in the course of doing insurance business;&nbsp;</span></p> <p><span class="cls0">5. Intentionally misrepresenting the terms of an actual or proposed insurance contract or application for insurance;&nbsp;</span></p> <p><span class="cls0">6. Having been convicted of a felony;&nbsp;</span></p> <p><span class="cls0">7. Having admitted or been found to have committed any insurance unfair trade practice or fraud;&nbsp;</span></p> <p><span class="cls0">8. Using fraudulent, coercive, or dishonest practices, or demonstrating incompetence, untrustworthiness or financial irresponsibility in the conduct of business in this state or elsewhere;&nbsp;</span></p> <p><span class="cls0">9. Having an insurance producer license, or its equivalent, denied, suspended, censured, placed on probation or revoked in any other state, province, district or territory;&nbsp;</span></p> <p><span class="cls0">10. Forging another&rsquo;s name to an application for insurance or to any document related to an insurance transaction;&nbsp;</span></p> <p><span class="cls0">11. Improperly using notes or any other reference material to complete an examination for an insurance license;&nbsp;</span></p> <p><span class="cls0">12. Knowingly accepting insurance business from an individual who is not licensed;&nbsp;</span></p> <p><span class="cls0">13. Failing to comply with an administrative or court order imposing a child support obligation; or&nbsp;</span></p> <p><span class="cls0">14. Failing to pay state income tax or comply with any administrative or court order directing payment of state income tax.&nbsp;</span></p> <p><span class="cls0">B. In the event that the action by the Insurance Commissioner is to nonrenew or to deny an application for a license, the Insurance Commissioner shall notify the applicant or licensee and advise the applicant or licensee, in writing, of the reason for the denial or nonrenewal of the applicant&rsquo;s or licensee&rsquo;s license. The applicant or licensee may make written demand upon the Insurance Commissioner within thirty (30) days of the date of notification of said notification by the Insurance Commissioner for a hearing before the Insurance Commissioner or an independent hearing examiner to determine the reasonableness of the Insurance Commissioner&rsquo;s action. The hearing shall be heard within a reasonable time period and shall be held pursuant to the Oklahoma Administrative Procedures Act.&nbsp;</span></p> <p><span class="cls0">C. The license of a business entity may be suspended, revoked or refused if the Insurance Commissioner finds, after opportunity for hearing, that an individual licensee&rsquo;s violation was known or should have been known by one or more of the partners, officers or managers acting on behalf of the partnership or corporation and the violation was neither reported to the Insurance Commissioner nor corrective action taken.&nbsp;</span></p> <p><span class="cls0">D. In addition to or in lieu of any applicable denial, probation, censure, suspension or revocation of a license, a person may, after opportunity for hearing, be subject to a civil fine of not less than One Hundred Dollars ($100.00) nor more than One Thousand Dollars ($1,000.00) for each occurrence. Said penalty may be enforced in the same manner in which civil judgments may be enforced.&nbsp;</span></p> <p><span class="cls0">E. Every licensee licensed pursuant to the provisions of the Oklahoma Producer Licensing Act shall keep at the licensee&rsquo;s place of business the usual and customary records pertaining to transactions authorized by the license. All records as to any particular transactions shall be kept available and open to the inspection of the Commissioner at any time during business hours during the three (3) years immediately following the date of completion of the transaction. The Commissioner may require a financial or market conduct examination during any investigation of a licensee. The cost of such examination shall be apportioned among all of the appointing insurers of the licensee.&nbsp;</span></p> <p><span class="cls0">F. The Insurance Commissioner shall retain the authority to enforce the provisions of and impose any penalty or remedy authorized by the Oklahoma Producer Licensing Act and Title 36 of the Oklahoma Statutes against any person who is under investigation for or charged with a violation of the Oklahoma Producer Licensing Act or Title 36 of the Oklahoma Statutes even if the person&rsquo;s license or registration has been surrendered or has lapsed by operation of law.&nbsp;</span></p> <p><span class="cls0">G. Files pertaining to investigations or legal matters which contain information concurring a current and ongoing investigation of allegations of violations of the Oklahoma Insurance Code by a licensed agent shall not be available for public inspection without proper judicial authorization; however, a licensee under investigation for alleged violations of the Oklahoma Insurance Code, or against whom an action for alleged violations of the Oklahoma Insurance Code has been commenced, may view evidence and complaints pertaining to the investigation, other than privileged information, at reasonable times at the Commissioner&rsquo;s office. All qualification examination materials, booklets and answers for any license authorized to be issued by the Commissioner under any statute shall not be available for public inspection. The residence address, residence telephone number, birth date, and social security number of a licensee shall not be available for public inspection. A separate business or mailing address provided by the licensee shall be considered a public record. If the residence and business addresses or residence and business telephone numbers are the same, such addresses or telephone numbers shall be considered a public record.&nbsp;</span></p> <p><span class="cls0">H. The Commissioner shall promptly notify all appointing insurers, where applicable, and the licensee regarding any censure, suspension, revocation or termination of license by the Commissioner.&nbsp;</span></p> <p><span class="cls0">I. Upon suspension, revocation or termination of the license of a resident or nonresident of this state, the Commissioner shall notify the Central Office of the National Association of Insurance Commissioners, or its appropriate nonprofit affiliates and the Insurance Commissioner of each state for whom the Commissioner has executed a certificate of licensure status.&nbsp;</span></p> <p><span class="cls0">J. Any licensee who ceases to maintain residency in this state shall deliver the licensee&rsquo;s insurance license to the Commissioner by personal delivery or by mail with return receipt requested within ten (10) days after terminating residency.&nbsp;</span></p> <p><span class="cls0">K. The Commissioner may issue a duplicate license for any lost, stolen or destroyed license issued pursuant to this act upon an affidavit of the licensee prescribed by the Commissioner concerning the facts of such loss, theft or destruction.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 13, eff. Nov. 1, 2001. Amended by Laws 2004, c. 274, &sect; 9, eff. July 1, 2004; Laws 2007, c. 125, &sect; 12, eff. July 1, 2007.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.13a. Property and casualty insurance producers - Fiduciary duties - Violation - Punishment.&nbsp;</span></p> <p><span class="cls0">A. The provisions of this section shall apply only to property and casualty insurance producers. All premiums belonging to insurers and all unearned premiums belonging to insureds received by an insurance producer licensee under this article shall be treated by the insurance producer licensee in a fiduciary capacity.&nbsp;</span></p> <p><span class="cls0">1. All premiums received less commissions, if authorized, shall be remitted by the insurance producer licensee to the insurer or its agent entitled thereto on or before the contractual due date or, if there is no contractual due date, within forty-five (45) days after receipt.&nbsp;</span></p> <p><span class="cls0">2. All returned premiums received from insurers or credited by insurers to the account of the insurance producer licensee shall be remitted to or credited to the account of the licensee entitled thereto within thirty (30) days after receipt or credit.&nbsp;</span></p> <p><span class="cls0">3. An insurer or its agent shall promptly report to the Commissioner in writing the failure of any insurance producer to account for any collected premium to the insurer entitled to the accounting or to the insurer&rsquo;s agent entitled thereto for more than forty-five (45) days after the contractual due date or, if there is no contractual due date, more than ninety (90) days after receipt.&nbsp;</span></p> <p><span class="cls0">B. Every insurer shall remit unearned premiums to the insured or the proper agent or shall otherwise credit the account of the proper insurance producer licensee as soon as is practicable after entitlement thereto has been established but in no event more than forty-five (45) days after the effective date of any cancellation or termination effected by the insurer or after the date of entitlement thereto as established by notification of cancellation or of termination or as otherwise established. Any insurance producer licensee having knowledge of a failure on the part of any insurer to comply with this subsection shall promptly report such failure to the Commissioner in writing.&nbsp;</span></p> <p><span class="cls0">C. No insurance producer licensee under this article shall commingle premiums belonging to insurers and returned premiums belonging to insureds with the personal funds of the insurance producer licensee or with any other funds except those directly connected with the producer licensee&rsquo;s insurance business.&nbsp;</span></p> <p><span class="cls0">D. Any insurer that delivers in this state a policy of insurance to an insurance producer licensee representing the interest of an insured upon the application or request of the insurance producer licensee shall be deemed to have authorized the producer to receive any premium due upon issuance or delivery of the policy on behalf of the insurer.&nbsp;</span></p> <p><span class="cls0">E. 1. An insurance producer licensee or surplus line producer convicted of knowingly misappropriating or knowingly converting to his or her own use or wrongfully withholding fiduciary moneys in the amount of One Hundred Fifty Dollars ($150.00) or less is guilty of a misdemeanor punishable by a fine not to exceed One Thousand Dollars ($1,000.00) or by imprisonment in the county jail for a term not to exceed one year or by both such fine and imprisonment.&nbsp;</span></p> <p><span class="cls0">2. An insurance producer licensee or surplus line producer with a second or subsequent conviction for knowingly misappropriating or knowingly converting to his or her own use or wrongfully withholding fiduciary moneys in the amount of One Hundred Fifty Dollars ($150.00) or less or who is convicted of knowingly misappropriating or knowingly converting to his or her own use or wrongfully withholding premiums in an amount in excess of One Hundred Fifty Dollars ($150.00) is guilty of a felony punishable by a fine not to exceed Five Thousand Dollars ($5,000.00) or by imprisonment in the custody of the Department of Corrections for a term not to exceed five (5) years or by both such fine and imprisonment.&nbsp;</span></p> <p><span class="cls0">F. The Commissioner may promulgate rules for the implementation of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2006, c. 264, &sect; 48, eff. July 1, 2006.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1435.14. Payment or acceptance of commission, service fee, brokerage or other valuable consideration &ndash; Recipient to be licensed.&nbsp;</span></p> <p><span class="cls0">A. An insurance company or insurance producer shall not pay a commission, service fee, brokerage or other valuable consideration to a person for selling, soliciting or negotiating insurance in this state if that person is required to be licensed under this act and is not so licensed.&nbsp;</span></p> <p><span class="cls0">B. A person shall not accept a commission, service fee, brokerage or other valuable consideration for selling, soliciting or negotiating insurance in this state if that person is required to be licensed under this act and is not so licensed.&nbsp;</span></p> <p><span class="cls0">C. Renewal or other deferred commissions may be paid to a person for selling, soliciting or negotiating insurance in this state if the person was required to be licensed under this act at the time of the sale, solicitation or negotiation and was so licensed at that time.&nbsp;</span></p> <p><span class="cls0">D. An insurer or insurance producer may pay or assign commissions, service fees, brokerages or other valuable consideration to an insurance agency or to persons who do not sell, solicit or negotiate insurance in this state, unless the payment would violate Section 1204 of Title 36 of the Oklahoma Statutes.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 14, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.15. Appointment of producer as agent of insurer - Notice of appointment - Discrimination among producers - Penalties.&nbsp;</span></p> <p><span class="cls0">A. An insurance producer shall not act as an agent of an insurer unless the insurance producer becomes an appointed agent of that insurer. An insurance producer who is not acting as an agent of an insurer is not required to become appointed.&nbsp;</span></p> <p><span class="cls0">B. To appoint a producer as its agent, the appointing insurer, or an authorized representative of the insurer, shall file, in a format approved by the Insurance Commissioner, a notice of appointment within fifteen (15) days from the date the agency contract is executed or the first insurance application is submitted. For purposes of this section, an "authorized representative of the insurer" means a person or entity licensed by the Insurance Commissioner pursuant to the laws of this state who is authorized in writing by the appointing insurer to file appointments for the appointing insurer. An insurer or authorized representative of an insurer may also elect to appoint a producer to all or some insurers within the insurer&rsquo;s holding company system or group by the filing of a single appointment request.&nbsp;</span></p> <p><span class="cls0">C. Upon receipt of the notice of appointment, the Insurance Commissioner shall verify within a reasonable time not to exceed thirty (30) days that the insurance producer is eligible for appointment. If the insurance producer is determined to be ineligible for appointment, the Insurance Commissioner shall notify the insurer and the authorized representative of the insurer within five (5) days of its determination.&nbsp;</span></p> <p><span class="cls0">D. An insurer or authorized representative of an insurer shall pay a biennial appointment fee, in the amount and method of payment set forth in Section 1435.23 of this title, for each insurance producer appointed by the insurer for each insurer for which the insurance producer is appointed.&nbsp;</span></p> <p><span class="cls0">E. It shall be unlawful for any insurer to discriminate among or between the insurance producers it has appointed. Any person or company convicted of violating the provisions of this section shall be guilty of a misdemeanor and shall be punished by the imposition of a fine of not more than Five Hundred Dollars ($500.00) or imprisonment in the county jail for not less than six (6) months nor more than one (1) year, or be punished by both said fine and imprisonment.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 15, eff. Nov. 1, 2001. Amended by Laws 2002, c. 307, &sect; 17, eff. Nov. 1, 2002; Laws 2007, c. 125, &sect; 13, eff. July 1, 2007; Laws 2009, c. 176, &sect; 28, eff. Nov. 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1435.16. Termination of appointment, employment, contract or other business relationship &ndash; Notification &ndash; Immunity from liability &ndash; Confidentiality &ndash; Final adjudicated actions.&nbsp;</span></p> <p><span class="cls0">A. An insurer or authorized representative of the insurer that terminates the appointment, employment, contract or other insurance business relationship with a producer shall notify the Insurance Commissioner within thirty (30) days following the effective date of the termination, using a format prescribed by the Insurance Commissioner, if the reason for termination is one of the reasons set forth in Section 13 of this act or the insurer has knowledge the producer was found by a court, government body, or self-regulatory organization authorized by law to have engaged in any of the activities in Section 13 of this act. Upon the written request of the Insurance Commissioner, the insurer shall provide additional information, documents, records or other data pertaining to the termination or activity of the producer.&nbsp;</span></p> <p><span class="cls0">B. An insurer or authorized representative of the insurer that terminates the appointment, employment, or contract with a producer for any reason not set forth in Section 13 of this act, shall notify the Insurance Commissioner within thirty (30) days following the effective date of the termination, using a format prescribed by the Insurance Commissioner. Upon written request of the Insurance Commissioner, the insurer shall provide additional information, documents, records or other data pertaining to the termination.&nbsp;</span></p> <p><span class="cls0">C. The insurer or the authorized representative of the insurer shall promptly notify the Insurance Commissioner in a format acceptable to the Insurance Commissioner if, upon further review or investigation, the insurer discovers additional information that would have been reportable to the Insurance Commissioner in accordance with subsection A of this section had the insurer then known of its existence.&nbsp;</span></p> <p><span class="cls0">D. 1. Within fifteen (15) days after making the notification required by subsections A, B and C of this section, the insurer shall mail a copy of the notification to the producer at the producer&rsquo;s last-known address. If the producer is terminated for cause for any of the reasons listed in Section 13 of this act, the insurer shall provide a copy of the notification to the producer at the producer&rsquo;s last-known address by certified mail, return receipt requested, postage prepaid or by overnight delivery using a nationally recognized carrier.&nbsp;</span></p> <p><span class="cls0">2. Within thirty (30) days after the producer has received the original or additional notification, the producer may file written comments concerning the substance of the notification with the Insurance Commissioner. The producer shall, by the same means, simultaneously send a copy of the comments to the reporting insurer, and the comments shall become a part of the Insurance Commissioner&rsquo;s file and accompany every copy of a report distributed or disclosed for any reason about the producer as permitted under subsection F of this section.&nbsp;</span></p> <p><span class="cls0">E. 1. In the absence of actual malice, an insurer, the authorized representative of the insurer, a producer, the Insurance Commissioner, or an organization of which the Insurance Commissioner is a member and that compiles the information and makes it available to other Insurance Commissioners or regulatory or law enforcement agencies shall not be subject to civil liability, and a civil cause of action of any nature shall not arise against these entities or their respective agents or employees, as a result of any statement or information required by or provided pursuant to this section or any information relating to any statement that may be requested in writing by the Insurance Commissioner, from an insurer or producer; or a statement by a terminating insurer or producer to an insurer or producer limited solely and exclusively to whether a termination for cause under subsection A of this section was reported to the Insurance Commissioner, provided that the propriety of any termination for cause under subsection A of this section is certified in writing by an officer or authorized representative of the insurer or producer terminating the relationship.&nbsp;</span></p> <p><span class="cls0">2. In any action brought against a person that may have immunity under paragraph 1 of this subsection for making any statement required by this section or providing any information relating to any statement that may be requested by the Insurance Commissioner, the party bringing the action shall plead specifically in any allegation that paragraph 1 of this subsection does not apply because the person making the statement or providing the information did so with actual malice.&nbsp;</span></p> <p><span class="cls0">3. Paragraph 1 or 2 of this subsection shall not abrogate or modify any existing statutory or common law privileges or immunities.&nbsp;</span></p> <p><span class="cls0">F. 1. Any documents, materials or other information in the control or possession of the Department of Insurance that is furnished by an insurer, producer or an employee or agent thereof acting on behalf of the insurer or producer, or obtained by the Insurance Commissioner in an investigation pursuant to this section shall be confidential by law and privileged, shall not be subject to the Open Records Act, shall not be subject to subpoena, and shall not be subject to discovery or admissible in evidence in any private civil action. However, the Insurance Commissioner is authorized to use the documents, materials or other information in the furtherance of any regulatory or legal action brought as a part of the Insurance Commissioner&rsquo;s duties.&nbsp;</span></p> <p><span class="cls0">2. Neither the Insurance Commissioner nor any person who received documents, materials or other information while acting under the authority of the Insurance Commissioner shall be permitted or required to testify in any private civil action concerning any confidential documents, materials, or information subject to paragraph 1 of this subsection.&nbsp;</span></p> <p><span class="cls0">3. In order to assist in the performance of the Insurance Commissioner&rsquo;s duties under this act, the Insurance Commissioner:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;may share documents, materials or other information, including the confidential and privileged documents, materials or information subject to paragraph 1 of this subsection, with other state, federal, and international regulatory agencies, with the National Association of Insurance Commissioners, its affiliates or subsidiaries, and with state, federal, and international law enforcement authorities, provided that the recipient agrees to maintain the confidentiality and privileged status of the document, material or other information,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;may receive documents, materials or information, including otherwise confidential and privileged documents, materials or information, from the National Association of Insurance Commissioners, its affiliates or subsidiaries and from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material or information, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;may enter into agreements governing sharing and use of information consistent with this subsection.&nbsp;</span></p> <p><span class="cls0">4. No waiver of any applicable privilege or claim of confidentiality in the documents, materials, or information shall occur as a result of disclosure to the Commissioner under this section or as a result of sharing as authorized in paragraph 3 of this subsection.&nbsp;</span></p> <p><span class="cls0">5. Nothing in the Oklahoma Producer Licensing Act shall prohibit the Insurance Commissioner from releasing final, adjudicated actions including for cause terminations that are open to public inspection pursuant to the Open Records Act to a database or other clearinghouse service maintained by the National Association of Insurance Commissioners, its affiliates or subsidiaries of the National Association of Insurance Commissioners.&nbsp;</span></p> <p><span class="cls0">G. An insurer, the authorized representative of the insurer, or producer that fails to report as required under the provisions of this section or that is found to have reported with actual malice by a court of competent jurisdiction may, after notice and hearing, have its license or certificate of authority suspended or revoked and may be fined in accordance with Section 13 of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 16, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.17. Waiver of requirements for nonresident producers &ndash; Reciprocity &ndash; Continuing education requirements.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall waive any requirements for a nonresident producer license applicant with a valid license from the applicant&rsquo;s home state, except the requirements imposed by Section 9 of this act, if the applicant&rsquo;s home state awards nonresident licenses to residents of this state on the same basis.&nbsp;</span></p> <p><span class="cls0">B. A nonresident producer&rsquo;s satisfaction of the producer&rsquo;s home state&rsquo;s continuing education requirements for licensed insurance producers shall constitute satisfaction of this state&rsquo;s continuing education requirements if the nonresident producer&rsquo;s home state recognizes the satisfaction of its continuing education requirements imposed upon producers from this state on the same basis.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 17, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.18. Administrative actions or criminal prosecutions against producer &ndash; Duty to report to Commissioner.&nbsp;</span></p> <p><span class="cls0">A. A producer shall report to the Insurance Commissioner any administrative action taken against the producer in another jurisdiction or by another governmental agency in this state within thirty (30) days of the final disposition of the matter. This report shall include a copy of the order, consent to order or other relevant legal documents.&nbsp;</span></p> <p><span class="cls0">B. Within thirty (30) days of the initial pretrial hearing date, a producer shall report to the Insurance Commissioner any criminal prosecution of the producer taken in any jurisdiction. The report shall include a copy of the initial complaint filed, the order resulting from the hearing and any other relevant legal documents.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 18, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.19. Rules.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner may, in accordance with Section 307.1 of Title 36 of the Oklahoma Statutes, promulgate reasonable rules as are necessary or proper to carry out the purposes of the Oklahoma Producer Licensing Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 19, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.20. Limited lines producers - Qualification for license - Travel accident and baggage policies.&nbsp;</span></p> <p><span class="cls0">A. A limited lines producer may receive qualification for a license in one or more of the following categories:&nbsp;</span></p> <p><span class="cls0">1. Prepaid legal liability insurance, which means the assumption of an enforceable contractual obligation to provide specified legal services or to reimburse policyholders for specified legal expenses, pursuant to the provisions of a group or individual policy;&nbsp;</span></p> <p><span class="cls0">2. Crop - insurance providing protection against damage to crops from unfavorable weather conditions, fire or lightning, flood, hail, insect infestation, disease or other yield-reducing conditions or perils provided by the private insurance market, or that is subsidized by the Federal Crop Insurance Corporation, including Multi-Peril Crop Insurance;&nbsp;</span></p> <p><span class="cls0">3. Car rental - insurance offered, sold or solicited in connection with and incidental to the rental of rental cars for a period of two (2) years, whether at the rental office or by preselection of coverage in master, corporate, group or individual agreements that:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;is nontransferable,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;applies only to the rental car that is the subject of the rental agreement, and&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;is limited to the following kinds of insurance:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;personal accident insurance for renters and other rental car occupants, for accidental death or dismemberment, and for medical expenses resulting from an accident that occurs with the rental car during the rental period,&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;liability insurance that provides protection to the renters and other authorized drivers of a rental car for liability arising from the operation or use of the rental car during the rental period,&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;personal effects insurance that provides coverage to renters and other vehicle occupants for loss of, or damage to, personal effects in the rental car during the rental period,&nbsp;</span></p> <p class="cls3"><span class="cls0">(4)&nbsp;&nbsp;roadside assistance and emergency sickness protection insurance, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(5)&nbsp;&nbsp;any other coverage designated by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">A car rental limited lines license issued to a rental or leasing company shall authorize any employee or authorized representative of the rental or leasing company to sell or offer coverage at each location at which the rental or leasing company operates. Employees or authorized representatives are not required to be individually licensed;&nbsp;</span></p> <p><span class="cls0">4. Credit - credit life, credit disability, credit property, credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, guaranteed automobile protection insurance, or any other form of insurance offered in connection with an extension of credit that is limited to partially or wholly extinguishing that credit obligation and that is designated by the Insurance Commissioner as limited line credit insurance;&nbsp;</span></p> <p><span class="cls0">5. Surety - insurance or bond that covers obligations to pay the debts of, or answer for the default of another, including faithlessness in a position of public or private trust. For purpose of limited line licensing, surety does not include surety bail bonds; and&nbsp;</span></p> <p><span class="cls0">6. Travel - insurance coverage for trip cancellation, trip interruption, baggage, life, sickness and accident, disability, and personal effects when limited to a specific trip and sold in connection with transportation provided by a common carrier.&nbsp;</span></p> <p><span class="cls0">B. 1. An insurance producer or limited lines producer may solicit applications for and issue travel accident policies or baggage insurance by means of mechanical vending machines supervised by the insurance producer or limited lines producer only if the Insurance Commissioner shall determine that the form of policy to be sold is reasonably suited for sale and issuance through vending machines, that use of vending machines for the sale of said policies would be of convenience to the public, and that the type of vending machine to be used is reasonably suitable and practical for the sale and issuance of said policies. Policies so sold do not have to be countersigned.&nbsp;</span></p> <p><span class="cls0">2. The Commissioner shall issue to the insurance agent or limited insurance representative a special vending machine license for each such machine to be used. The license shall specify the name and address of the insurer and licensee, the kind of insurance and type of policy to be sold, and the place where the machine is to be in operation. The license shall expire, be renewable, and be suspended or revoked coincidentally with the insurance agent license or limited representative license of the licensee. The license fee for each vending machine shall be that stated in the provisions of Section 1435.23 of this title. Proof of existence of the license shall be displayed on or about each machine in such manner as the Commissioner may reasonably require.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 60, eff. Nov. 1, 1997. Amended by Laws 1999, c. 36, &sect; 1, eff. Nov. 1, 1999; Laws 1999, c. 333, &sect; 1, eff. July 1, 1999; Laws 2000, c. 353, &sect; 9, eff. Nov. 1, 2000; Laws 2001, c. 156, &sect; 20, eff. Nov. 1, 2001. Renumbered from &sect; 1424.11 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001. Amended by Laws 2003, c. 150, &sect; 4, eff. Nov. 1, 2003; Laws 2008, c. 184, &sect; 12, eff. July 1, 2008; Laws 2013, c. 224, &sect; 1, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1435.21. Licensure for purposes of writing controlled business prohibited.&nbsp;</span></p> <p><span class="cls0">A. The Commissioner shall not grant, renew, continue, or permit to continue any license if the Commissioner finds that the license is being or will be used by the applicant or licensee for the purpose of writing controlled business. "Controlled business" means:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;insurance written on the interests of the licensee or those of his or her relatives to the second degree or of his or her employer, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;insurance covering the licensee or relatives of the licensee to the second degree or a corporation, association, or partnership of which the licensee or a member of the licensee&rsquo;s immediate family is an officer, director, substantial stockholder, partner, associate, or employee, or the officers, directors, substantial stockholders, partners, or employees of such a corporation, association, or partnership. A vendor's or lender's interest in property sold or being sold pursuant to contract or which is security for any loan shall not be deemed for the purpose of this provision to constitute property or an interest of the vendor or lender.&nbsp;</span></p> <p><span class="cls0">B. A license shall be deemed to have been or intended to be used for the purpose of writing controlled business if the Commissioner finds that during any twelve-month period the aggregate commissions earned from controlled business has exceeded twenty-five percent (25%) of the aggregate commissions earned on all business written by the applicant or licensee during the same period.&nbsp;</span></p> <p><span class="cls0">C. The prohibitions contained in this section concerning licensing for the writing of controlled business shall not apply to title insurance producers and limited lines producers.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 63, eff. Nov. 1, 1997. Amended by Laws 2001, c. 156, &sect; 21, eff. Nov. 1, 2001. Renumbered from &sect; 1424.14 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.22. Application for customer service representative license or license renewal &ndash; Written appointment &ndash; Surety protection.&nbsp;</span></p> <p><span class="cls0">A. Application for a customer service representative license or license renewal shall be accompanied by a written appointment, which shall remain in effect until expressly terminated in writing, signed by the insurance agent or broker who will supervise the customer service representative, on forms prescribed by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">B. 1. Prior to issuance of a license as an insurance consultant or surplus lines insurance broker, the applicant shall file with the Commissioner and thereafter, for as long as the license remains in effect, shall keep in force a bond in an amount of not less than Five Thousand Dollars ($5,000.00) and not more than Forty Thousand Dollars ($40,000.00) with an authorized corporate surety approved by the Commissioner. The exact amount of the bond shall be determined pursuant to the rules of the Commissioner and shall be based upon the actual or reasonably estimated premium for policies issued in connection with the services of the licensee. The surety shall notify the Commissioner of any changes in the bond of any licensee. The aggregate liability of the surety for any and all claims on a bond required by the provisions of this subsection shall in no event exceed the amount of the bond. No such bond shall be terminated unless at least thirty (30) days' prior written notice of the termination is given by the surety to the licensee and the Commissioner. Upon termination of the license for which the bond was in effect, the licensee shall notify the surety within ten (10) working days.&nbsp;</span></p> <p><span class="cls0">2. The Commissioner may waive bonding requirements for nonresident surplus lines insurance brokers.&nbsp;</span></p> <p><span class="cls0">3. All surety protection required by the provisions of this section is to inure to the benefit of any party aggrieved by the acts of a consultant or broker arising pursuant to conduct as a licensed insurance consultant or surplus lines insurance broker.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 22, eff. Nov. 1, 2001. Amended by Laws 2002, c. 307, &sect; 18, eff. Nov. 1, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.23. License fees &ndash; Collection by Commissioner.&nbsp;</span></p> <p><span class="cls0">A. All applications shall be accompanied by the applicable fees. An appointment may be deemed by the Commissioner to have terminated upon failure by the insurer to pay the prescribed renewal fee. The Commissioner may also by order impose a civil penalty equal to double the amount of the unpaid renewal fee.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner shall collect in advance the following fees and licenses:&nbsp;</span></p> <p class="cls16"><span class="cls0">1. For filing appointment of Insurance Commissioner as agent for service of process&nbsp;&nbsp;$ 20.00&nbsp;</span></p> <p class="cls17"><span class="cls0">2. Miscellaneous:&nbsp;</span></p> <p class="cls18"><span class="cls0">a.&nbsp;&nbsp;Insurance producer's study manual:&nbsp;</span></p> <p class="cls11"><span class="cls0">(1)&nbsp;&nbsp;Life, Accident & Health&nbsp;&nbsp;not to exceed&nbsp;</span></p> <p class="cls18"><span class="cls0">&nbsp;&nbsp;&nbsp;&nbsp;$ 40.00&nbsp;</span></p> <p class="cls11"><span class="cls0">(2)&nbsp;&nbsp;Property and Casualty&nbsp;&nbsp;not to exceed&nbsp;</span></p> <p class="cls18"><span class="cls0">&nbsp;&nbsp;&nbsp;&nbsp;$ 40.00&nbsp;</span></p> <p class="cls18"><span class="cls0">b.&nbsp;&nbsp;For filing organizational documents of an entity applying for a license as an insurance producer&nbsp;&nbsp;$ 20.00&nbsp;</span></p> <p class="cls17"><span class="cls0">3. Examination for license:&nbsp;</span></p> <p class="cls19"><span class="cls0">For each examination covering laws and one or more lines of insurance&nbsp;&nbsp;not to exceed&nbsp;</span></p> <p class="cls18"><span class="cls0">&nbsp;&nbsp;&nbsp;&nbsp;$100.00&nbsp;</span></p> <p class="cls17"><span class="cls0">4. Licenses:&nbsp;</span></p> <p class="cls18"><span class="cls0">a.&nbsp;&nbsp;Insurance producer's biennial license&nbsp;&nbsp;$ 60.00&nbsp;</span></p> <p class="cls18"><span class="cls0">b.&nbsp;&nbsp;Nonresident insurance producer's biennial license&nbsp;&nbsp;$100.00&nbsp;</span></p> <p class="cls18"><span class="cls0">c.&nbsp;&nbsp;Insurance producer's biennial license for sale or solicitation of variable insurance products&nbsp;&nbsp;$ 60.00&nbsp;</span></p> <p class="cls18"><span class="cls0">d.&nbsp;&nbsp;Limited lines producer biennial license&nbsp;&nbsp;$ 40.00&nbsp;</span></p> <p class="cls18"><span class="cls0">e.&nbsp;&nbsp;Nonresident limited lines producer biennial license&nbsp;&nbsp;$100.00&nbsp;</span></p> <p class="cls11"><span class="cls0">f.&nbsp;&nbsp;(1)&nbsp;&nbsp;Car rental limited lines biennial license, one or two locations, resident or nonresident&nbsp;&nbsp;$ 40.00&nbsp;</span></p> <p class="cls11"><span class="cls0">(2)&nbsp;&nbsp;Car rental limited lines biennial license, three or more locations, resident or nonresident&nbsp;&nbsp;$500.00&nbsp;</span></p> <p class="cls18"><span class="cls0">g.&nbsp;&nbsp;Temporary license as agent&nbsp;&nbsp;$ 20.00&nbsp;</span></p> <p class="cls18"><span class="cls0">h.&nbsp;&nbsp;Managing general agent's biennial license&nbsp;&nbsp;$ 60.00&nbsp;</span></p> <p class="cls18"><span class="cls0">i.&nbsp;&nbsp;Surplus lines broker's biennial license&nbsp;&nbsp;$100.00&nbsp;</span></p> <p class="cls18"><span class="cls0">j.&nbsp;&nbsp;Insurance vending machine, each machine, biennial fee&nbsp;&nbsp;$100.00&nbsp;</span></p> <p class="cls18"><span class="cls0">k.&nbsp;&nbsp;Insurance consultant's biennial license, resident or nonresident&nbsp;&nbsp;$100.00&nbsp;</span></p> <p class="cls18"><span class="cls0">l.&nbsp;&nbsp;Customer service representative biennial license&nbsp;&nbsp;$ 40.00&nbsp;</span></p> <p class="cls20"><span class="cls0">5. Annual fee for each appointed insurance producer, managing general agent, or limited lines producer by insurer, each license of each insurance producer or representative&nbsp;&nbsp;$30.00&nbsp;</span></p> <p><span class="cls0">6. Renewal fee for all licenses shall be the same as the current initial license fee.&nbsp;</span></p> <p><span class="cls0">7. The fee for a duplicate license shall be one-half (1/2) the fee of an original license.&nbsp;</span></p> <p><span class="cls0">8. The renewal of a license shall require a fee of double the current original license fee if the application for renewal is late, or incomplete on the renewal deadline.&nbsp;</span></p> <p><span class="cls0">9. The administrative fee for submission of a change of legal name or address more than thirty (30) days after the change occurred shall be Fifty Dollars ($50.00).&nbsp;</span></p> <p><span class="cls0">B. If for any reason an insurance producer license or appointment is not issued or renewed by the Commissioner, all fees accompanying the appointment or application for the license shall be deemed earned and shall not be refundable except as provided in Section 352 of this title.&nbsp;</span></p> <p><span class="cls0">C. The Insurance Commissioner, by order, may waive licensing fees in extraordinary circumstances for a class of producers where the Commissioner deems that the public interest will be best served.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1980, c. 164, &sect; 5, emerg. eff. April 15, 1980. Amended by Laws 1981, c. 230, &sect; 3, emerg. eff. June 22, 1981; Laws 1982, c. 221, &sect; 2, operative Oct. 1, 1982; Laws 1983, c. 90, &sect; 3, emerg. eff. May 9, 1983; Laws 1983, c. 248, &sect; 6, emerg. eff. June 21, 1983; Laws 1984, c. 173, &sect; 3, emerg. eff. May 7, 1984; Laws 1984, c. 215, &sect; 4, operative June 30, 1984; Laws 1985, c. 179, &sect; 96, operative July 1, 1985; Laws 1985, c. 258, &sect; 2, eff. Nov. 1, 1985; Laws 1987, c. 208, &sect; 73, operative July 1, 1987; Laws 1987, c. 236, &sect; 90, emerg. eff. July 20, 1987; Laws 1988, c. 116, &sect; 3, eff. Nov. 1, 1988; Laws 1988, c. 204, &sect; 2, operative July 1, 1988; Laws 1993, c. 270, &sect; 38, eff. Sept. 1, 1993; Laws 1994, c. 337, &sect; 1, eff. Sept. 1, 1994; Laws 1995, c. 1, &sect; 11, emerg. eff. March 2, 1995; Laws 1996, c. 246, &sect; 4, eff. July 1, 1996; Laws 1997, c. 418, &sect; 69, eff. Nov. 1, 1997; Laws 2001, c. 156, &sect; 23, eff. Nov. 1, 2001. Renumbered from &sect; 1425 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001. Amended by Laws 2002, c. 307, &sect; 19, eff. Nov. 1, 2002; Laws 2006, c. 264, &sect; 47, eff. July 1, 2006; Laws 2007, c. 125, &sect; 14, eff. July 1, 2007; Laws 2008, c. 184, &sect; 13, eff. July 1, 2008; Laws 2009, c. 176, &sect; 29, eff. Nov. 1, 2009; Laws 2009, c. 432, &sect; 12, eff. July 1, 2009; Laws 2011, c. 242, &sect; 5; Laws 2011, c. 278, &sect; 24; Laws 2011, c. 293, &sect; 5, emerg. eff. June 20, 2011; Laws 2011, c. 360, &sect; 23; Laws 2013, c. 224, &sect; 2, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 242, &sect; 5 and Laws 2011, c. 293, &sect; 5 made identical changes to this section. Laws 2011, c. 360, &sect; 23 amended Laws 2011, c. 242, &sect; 5, creating a version identical to Laws 2011, c. 278, &sect; 24.&nbsp;</span></p> <p><span class="cls0">NOTE: Laws 1994, c. 272, &sect; 4 and Laws 1994, c. 294, &sect; 2 repealed by Laws 1995, c. 1, &sect; 40, emerg. eff. March 2, 1995. Laws 1997, c. 133, &sect; 447 repealed by Laws 1999, 1st Ex.Sess., c. 5, &sect; 452, eff. July 1, 1999.&nbsp;</span></p> <p><span class="cls0">NOTE: Laws 1998, 1st Ex.Sess., c. 2, &sect; 23 amended the effective date of Laws 1997, c. 133, &sect; 447 from July 1, 1998, to July 1, 1999.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1435.24. Insurance consultant&rsquo;s license &ndash; Nonresident applicants &ndash; Designation of service of process.&nbsp;</span></p> <p><span class="cls0">A. The Insurance Commissioner shall issue an insurance consultant's license to any duly qualified resident or nonresident of this state, whether an individual or legal entity, in accordance with this section.&nbsp;</span></p> <p><span class="cls0">1. An applicant may qualify as a resident if the applicant resides in this state. Any license issued pursuant to any such application claiming residency in this state for licensing in this state shall constitute an election of residency in this state and shall be void if the licensee, while holding a resident license in this state, also holds or makes application for a license in or thereafter claims to be a resident of any other state or other jurisdiction or ceases to be a resident of this state. However, if the applicant is a resident of a community or trade area, the border of which is contiguous with the state line of this state, the applicant may qualify as a resident in such other state and may hold a resident license from each state, so long as both states are party to a reciprocal dual licensing agreement.&nbsp;</span></p> <p><span class="cls0">2. A license issued to a nonresident of this state shall grant the same rights and privileges afforded a resident licensee, except as otherwise provided for by law.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner shall not issue a license to any nonresident applicant until the applicant files with the Commissioner the applicant&rsquo;s designation of the Commissioner as the person upon whom may be served all lawful process in any action, suit, or proceeding instituted by or on behalf of any interested person arising out of the insurance business of the applicant in this state. This designation shall constitute an agreement that said service of process is of the same legal force and validity as personal service of process in this state upon the nonresident licensee. Service of process upon any such licensee in any such action or proceeding in any court of competent jurisdiction of this state may be made by serving the Commissioner with three copies thereof and by paying to the Commissioner a fee of Twenty Dollars ($20.00). The Commissioner shall forward a copy of the process by mail with return receipt requested to the licensee at the licensee&rsquo;s lastknown address of record or principal place of business, and the Commissioner shall keep a record of all process so served upon the licensee.&nbsp;</span></p> <p><span class="cls0">C. Service of process upon any such licensee in any action or proceeding instituted by the Commissioner pursuant to the provisions of this Code shall be made by the Commissioner by mailing the process by mail with return receipt requested to the licensee at the licensee&rsquo;s last-known address of record or principal place of business. Service of process, other than a subpoena, upon any nonresident licensee is sufficient, provided notice of the service and a copy of the process are sent within ten (10) days thereafter to the licensee at the licensee&rsquo;s last-known address of record or principal place of business by mail with return receipt requested.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 71, eff. Nov. 1, 1997. Amended by Laws 2000, c. 205, &sect; 34, emerg. eff. May 17, 2000; Laws 2001, c. 156, &sect; 24, eff. Nov. 1, 2001. Renumbered from &sect; 1425.2 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.25. Repealed by Laws 2008, c. 184, &sect; 32, eff. July 1, 2008.&nbsp;</span></p> <p><span class="cls0">&sect;36-1435.26. Unlawful acts and penalties.&nbsp;</span></p> <p><span class="cls0">A. It shall be unlawful for any person whose license to act as an insurance producer, limited lines producer, managing general agent, insurance consultant, surplus lines insurance broker, or customer service representative has been suspended, revoked, surrendered, or refused to do or perform any of the acts of an insurance producer, limited lines producer, managing general agent, insurance consultant, surplus lines insurance broker, or customer service representative. Any person convicted of violating the provisions of this section shall be guilty of a felony and shall be punished by the imposition of a fine of not more than Five Thousand Dollars ($5,000.00) or shall be committed to the custody of the Department of Corrections for not less than one (1) year nor more than five (5) years, or be punished by both said fine and commitment to custody.&nbsp;</span></p> <p><span class="cls0">B. It shall be unlawful for any insurance producer, limited lines producer, managing general agent, insurance consultant, surplus lines insurance broker, or customer service representative to assist, aid, or conspire with a person whose license as an insurance producer, limited lines producer, managing general agent, insurance consultant, surplus lines insurance broker, or customer service representative has been suspended, revoked, surrendered, or refused to engage in any acts as an insurance producer, limited lines producer, managing general agent, insurance consultant, surplus lines insurance broker, or customer service representative. Any person convicted of violating the provisions of this section shall be guilty of a felony and shall be punished by the imposition of a fine of not more than Five Thousand Dollars ($5,000.00) or shall be committed to the custody of the Department of Corrections for not less than one (1) year nor more than five (5) years, or be punished by both said fine and commitment to custody.&nbsp;</span></p> <p><span class="cls0">C. Except for those persons exempt from licensure, it shall be unlawful for any person to do or perform any of the acts of an insurance producer, limited lines producer, managing general agent, surplus lines insurance broker, insurance consultant, or customer service representative without being duly licensed. Any person convicted of violating the provisions of this section shall be guilty of a misdemeanor and shall be punished by the imposition of a fine of not more than Five Hundred Dollars ($500.00) or imprisonment in the county jail for not less than six (6) months nor more than one (1) year, or be punished by both said fine and imprisonment.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 75, eff. Nov. 1, 1997. Amended by Laws 2001, c. 156, &sect; 26, eff. Nov. 1, 2001. Renumbered from &sect; 1425.6 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.27. Facsimile signature stamp as proof.&nbsp;</span></p> <p><span class="cls0">If an insurance producer or insurance producers choose to use a facsimile signature stamp in their business, such stamp shall be proof that the producer or producers have authorized the signing of any documents relating to the business of insurance.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 27, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.28. Ownership interest by producer in policy &ndash; Insurable interest.&nbsp;</span></p> <p><span class="cls0">It shall be unlawful for any insurance producer to receive an ownership interest in any policy, by assignment or otherwise, unless the insurance producer has an insurable interest in the life of the insured.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2001, c. 156, &sect; 28, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.29. Prelicensing and continuing education.&nbsp;</span></p> <p><span class="cls0">A. 1. Each insurance producer, with the exception of title producers and aircraft title producers or any other producer exempt by rule, shall, biennially, complete not less than twenty-one (21) clock hours of continuing insurance education. Such education may include a written or oral examination.&nbsp;</span></p> <p><span class="cls0">2. Each customer service representative shall, biennially, complete not less than ten (10) clock hours of continuing insurance education.&nbsp;</span></p> <p><span class="cls0">3. Licensees, with the exception of title producers and aircraft title producers or any other producer exempt by rule, shall complete, in addition to the foregoing, three (3) clock hours of ethics course work in this same period.&nbsp;</span></p> <p><span class="cls0">4. Each title producer and aircraft title producer shall, biennially, complete not less than sixteen (16) clock hours of continuing insurance education, two (2) hours of which shall be ethics course work, which shall cover the line for which the producer is licensed. Such education may include a written or oral examination.&nbsp;</span></p> <p><span class="cls0">B. 1. The Insurance Commissioner shall approve courses and providers of continuing education. The Insurance Department may use one or more of the following to review and provide a nonbinding recommendation to the Insurance Commissioner on approval or disapproval of courses and providers of continuing education:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;employees of the Insurance Commissioner,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;a continuing education advisory committee, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;an independent service whose normal business activities include the review and approval of continuing education courses and providers. The Commissioner may negotiate agreements with such independent service to review documents and other materials submitted for approval of courses and providers and provide the Commissioner with its nonbinding recommendation. The Commissioner may require such independent service to collect the fee charged by the independent service for reviewing materials provided for review directly from the course providers.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner has sole authority to approve courses and providers of continuing education. If the Insurance Commissioner uses one of the entities listed above to provide a nonbinding recommendation, the Commissioner shall adopt or decline to adopt the recommendation within thirty (30) days of receipt of the recommendation. In the event the Insurance Commissioner takes no action within said thirty-day period, the recommendation made to the Commissioner will be deemed to have been adopted by the Commissioner.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner may certify providers and courses offered for license examination study. The Insurance Department shall use employees of the Insurance Commissioner to review and certify license examination study program providers and courses.&nbsp;</span></p> <p><span class="cls0">2. Each insurance company shall be allowed to provide continuing education to insurance producers and customer service representatives as required by this section; provided that such continuing education meets the general standards for education otherwise established by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">3. An insurance producer who, during the time period prior to renewal, participates in a professional designation program, approved by the Insurance Commissioner, shall be deemed to have met the biennial requirement for continuing education.&nbsp;</span></p> <p><span class="cls0">The curriculum for the program shall total a minimum of twenty-four (24) hours within a twenty-four-month period. Each approved professional designation program included in this section shall be reviewed for quality and compliance every three (3) years in accordance with standardized criteria promulgated by rule. Continuation of approved status is contingent upon the findings of the review. The list of professional designation programs approved under this paragraph shall be made available to producers and providers annually.&nbsp;</span></p> <p><span class="cls0">4. The Insurance Department may promulgate rules providing that courses or programs offered by professional associations shall qualify for presumptive continuing education credit approval. The rules shall include standardized criteria for reviewing the professional associations' mission, membership, and other relevant information, and shall provide a procedure for the Department to disallow all or part of a presumptively approved course. Professional association courses approved in accordance with this paragraph shall be reviewed every three (3) years to determine whether they continue to qualify for continuing education credit.&nbsp;</span></p> <p><span class="cls0">5. Subject to approval by the Commissioner, the active membership of the licensed producer or broker in local, regional, state, or national professional insurance organizations or associations may be approved for up to one (1) annual hour of instruction. The hour shall be credited upon timely filing with the Commissioner, or designee of the Commissioner, and appropriate written evidence acceptable to the Commissioner of such active membership in the organization or association.&nbsp;</span></p> <p><span class="cls0">6. The active service of a licensed producer as a member of a continuing education advisory committee, as described in paragraph 1 of this subsection, shall be deemed to qualify for continuing education credit on an hour-for-hour basis.&nbsp;</span></p> <p><span class="cls0">C. 1. Annual fees and course submission fees shall be set forth as a rule by the Commissioner. The fees are payable to the Insurance Commissioner. Provided, public-funded educational institutions, federal agencies, nonprofit organizations, not-for-profit organizations, and Oklahoma state agencies shall be exempt from this subsection.&nbsp;</span></p> <p><span class="cls0">2. The Commissioner may assess a civil penalty, after notice and opportunity for hearing, against a continuing education provider who fails to comply with the requirements of the Oklahoma Producer Licensing Act, of not less than One Hundred Dollars ($100.00) nor more than Five Hundred Dollars ($500.00), for each occurrence. The civil penalty may be enforced in the same manner in which civil judgments may be enforced.&nbsp;</span></p> <p><span class="cls0">D. Failure of an insurance producer or customer service representative to comply with the requirements of the Oklahoma Producer Licensing Act may, after notice and opportunity for hearing, result in censure, suspension, nonrenewal of license or a civil penalty of up to Five Hundred Dollars ($500.00) or by both such penalty and civil penalty. Said civil penalty may be enforced in the same manner in which civil judgments may be enforced.&nbsp;</span></p> <p><span class="cls0">E. Limited lines producers and nonresident agents who have successfully completed an equivalent or greater requirement shall be exempt from the provisions of this section.&nbsp;</span></p> <p><span class="cls0">F. Members of the Legislature shall be exempt from this section.&nbsp;</span></p> <p><span class="cls0">G. The Commissioner shall adopt and promulgate such rules as are necessary for effective administration of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1987, c. 198, &sect; 1, eff. Nov. 1, 1987. Amended by Laws 1991, c. 204, &sect; 12, eff. Sept. 1, 1991; Laws 1993, c. 270, &sect; 39, eff. Sept. 1, 1993; Laws 1996, c. 246, &sect; 5, eff. July 1, 1996; Laws 1997, c. 418, &sect; 70, eff. Nov. 1, 1997. Renumbered from Title 36, &sect; 1425.1 by Laws 1997, c. 418, &sect; 127, eff. Nov. 1, 1997. Amended by Laws 2000, c. 353, &sect; 12, eff. Nov. 1, 2000; Laws 2001, c. 156, &sect; 29, eff. Nov. 1, 2001. Renumbered from Title 36, &sect; 1426A by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001. Amended by Laws 2002, c. 307, &sect; 20, eff. Nov. 1, 2002; Laws 2003, c. 150, &sect; 5, eff. Nov. 1, 2003; Laws 2007, c. 125, &sect; 15, eff. July 1, 2007; Laws 2008, c. 184, &sect; 14, eff. July 1, 2008; Laws 2009, c. 176, &sect; 30, eff. Nov. 1, 2009; Laws 2009, c. 432, &sect; 13, eff. July 1, 2009; Laws 2011, c. 278, &sect; 25, eff. Nov. 1, 2011; Laws 2012, c. 11, &sect; 7, emerg. eff. April 4, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">NOTE: Laws 2011, c. 242, &sect; 6 repealed by Laws 2012, c. 11, &sect; 8, emerg. eff. April 4, 2012. Laws 2011, c. 293, &sect; 6 repealed by Laws 2012, c. 11, &sect; 9, emerg. eff. April 4, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1435.30. Insurance consultants.&nbsp;</span></p> <p><span class="cls0">A. No person shall act as, or hold himself or herself out to be, an insurance consultant until a license as an insurance consultant has been issued to the person by the Insurance Commissioner. However, no insurance consultant's license shall be required of the following:&nbsp;</span></p> <p><span class="cls0">1. Attorneys licensed to practice law in this state acting in their professional capacity;&nbsp;</span></p> <p><span class="cls0">2. A duly licensed insurance producer or surplus lines insurance broker;&nbsp;</span></p> <p><span class="cls0">3. A trust officer of a bank acting in the normal course of employment; or&nbsp;</span></p> <p><span class="cls0">4. An actuary or a certified public accountant who provides information, recommendations, advice, or services in a professional capacity.&nbsp;</span></p> <p><span class="cls0">B. An application for a license to act as an insurance consultant shall be made to the Commissioner on forms prescribed by the Commissioner. Within a reasonable time after receipt of a properly completed application form, the Commissioner shall hold a written examination for the applicant, and may conduct investigations and propound interrogatories concerning the qualifications of the applicant, the residence, business affiliations, and any other matter which the Commissioner deems necessary or advisable to determine compliance with the provisions of the Oklahoma Producer Licensing Act or for the protection of the public.&nbsp;</span></p> <p><span class="cls0">C. In advance of rendering any service as an insurance consultant as defined in the provisions of Section 2 of this act, a written agreement on a form approved by the Commissioner shall be prepared by the consultant, and shall be signed by both the consultant and the client. The agreement shall outline the nature of the work to be performed by the consultant and shall state the fee for the work. The consultant shall retain a copy of the agreement for not less than three (3) years after completion of the services and shall make said copy available to the Insurance Commissioner upon request by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">D. No individual may concurrently hold a consultant's license and a license as an insurance producer, surplus lines insurance broker, or limited lines producer.&nbsp;</span></p> <p><span class="cls0">E. No licensed consultant in the performance of activities as a consultant may employ, be employed by, be in partnership with, or receive any remuneration whatsoever from, any licensed insurance producer, surplus lines insurance broker, limited producer, or insurer.&nbsp;</span></p> <p><span class="cls0">F. A license to act as an insurance consultant shall be valid for not longer than twenty-four (24) months and may be renewed biennially.&nbsp;</span></p> <p><span class="cls0">G. All requirements and standards relating to the denial, revocation, or suspension of an insurance producer&rsquo;s license, including penalties, shall apply to the denial, revocation, and suspension of an insurance consultant's license to the extent practicable.&nbsp;</span></p> <p><span class="cls0">H. A consultant is obligated by the terms of this license, to serve with objectivity and complete loyalty the interests of a client alone; and render to a client such information, counsel, and service as, within the knowledge, understanding, and opinion, in good faith, of the licensee, best serves the client's insurance needs and interests.&nbsp;</span></p> <p><span class="cls0">I. A duly licensed insurance producer or surplus lines insurance broker who acts as, or holds himself or herself out to be, an insurance consultant pursuant to the exemption from licensing as a consultant contained in the provisions of subsection A of this section shall nonetheless be subject to the provisions of subsections C and H of this section. However, nothing in this title shall prohibit the offset, in whole or in part, of the fee payable pursuant to the provisions of subsection C of this section by compensation otherwise payable to said duly licensed insurance producer or surplus lines insurance broker for acting as an insurance producer or broker.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1980, c. 164, &sect; 7, emerg. eff. April 15, 1980. Amended by Laws 1981, c. 230, &sect; 4, emerg. eff. June 22, 1981; Laws 1982, c. 221, &sect; 3, operative Oct. 1, 1982; Laws 1983, c. 90, &sect; 5, emerg. eff. May 9, 1983; Laws 1997, c. 418, &sect; 80, eff. Nov. 1, 1997; Laws 2001, c. 156, &sect; 30, eff. Nov. 1, 2001. Renumbered from &sect; 1427 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001. Amended by Laws 2003, c. 150, &sect; 6, eff. Nov. 1, 2003.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.31. Customer service representative - Appointment and employment - Scope of license.&nbsp;</span></p> <p><span class="cls0">A. As used in this section:&nbsp;</span></p> <p><span class="cls0">1. "Customer service representative" means an individual as defined by Section 2 of this act; and&nbsp;</span></p> <p class="cls2"><span class="cls0">2.&nbsp;&nbsp;a.&nbsp;&nbsp;"Insurance-related business" means taking applications, giving quotes, interpreting policies, explaining procedures, giving insurance advice, soliciting new customers at the appointing producer&rsquo;s, broker's, or agency's office or by telephone from that office, binding new or additional coverages, signing applications and binders in the customer service representative's own name, preliminary claims adjusting work, and such other transactions as authorized by rule of the Insurance Commissioner.&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;"Preliminary claims adjusting work" shall be limited to assisting in processing the claim which may include taking claims statements, getting estimates, advising claimants as to procedures, preparing claims paperwork, taking photos, and assembling and ordering claims files.&nbsp;</span></p> <p><span class="cls0">B. 1. Any person licensed and appointed as an insurance producer, broker, or managing general agent, except a limited lines producer, and any insurance agency may appoint and employ as customer service representatives any persons who hold or have qualified for a customer service representative's license.&nbsp;</span></p> <p><span class="cls0">2. No person shall be appointed and employed as a customer service representative by more than one appointing insurance producer, broker, or agency at any one time. The insurance producer or broker designated to supervise the work of the customer service representative shall sign the appointment form and shall thereby be obligated to supervise the customer service representative's conduct of insurance-related business and review such work.&nbsp;</span></p> <p><span class="cls0">3. A customer service representative shall be housed within the office of the insurance producer, broker, or agency by which the customer service representative is employed and shall not conduct insurance-related business as authorized herein from any other location. No advertising, letterhead, or telephone listing of the customer service representative shall indicate any business address other than that of the insurance producer, broker, or agency by which the customer service representative is employed.&nbsp;</span></p> <p><span class="cls0">C. 1. A customer service representative's license shall not cover any kind of insurance for which the appointing insurance producer, broker, or agency is not licensed or otherwise authorized to transact.&nbsp;</span></p> <p><span class="cls0">2. A customer service representative may conduct insurance-related business with customers who have been solicited by any insurance producer, broker, or customer service representative in the appointing agency, and may conduct insurance-related business with customers who have not been so solicited to the extent and under conditions that are otherwise consistent with this section and with the insurer's contract with the insurance producer or broker. In all such transactions the customer service representative must always identify himself or herself as a customer service representative of the appointing insurance producer, broker, or agency.&nbsp;</span></p> <p><span class="cls0">3. A customer service representative shall be a salaried employee of the appointing insurance producer, broker, or agency. Compensation shall not include commissions; however, up to forty-nine percent (49%) of such compensation may be based on production or volume of business.&nbsp;</span></p> <p><span class="cls0">4. All insurance-related business conducted by a customer service representative shall be in the name of the appointing insurance producer, broker, or agency. The insurance producer, broker, or agency shall be responsible and accountable for all acts of the customer service representative within the scope of such appointment.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1996, c. 246, &sect; 6, eff. July 1, 1996. Amended by Laws 2001, c. 156, &sect; 31, eff. Nov. 1, 2001. Renumbered from &sect; 1427.1 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.32. Repealed by Laws 2008, c. 184, &sect; 32, eff. July 1, 2008.&nbsp;</span></p> <p><span class="cls0">&sect;361435.33. Maximum agent&rsquo;s fees on renewals.&nbsp;</span></p> <p><span class="cls0">No life insurance company doing business in the State of Oklahoma shall charge a fee in excess of ten percent (10%) on any agent's renewals collected by said life insurance company.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1984, c. 173, &sect; 2, emerg. eff. May 7, 1984. Renumbered from &sect; 1424.1 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.34. Repealed by Laws 2008, c. 184, &sect; 32, eff. July 1, 2008.&nbsp;</span></p> <p><span class="cls0">&sect;36-1435.35. Repealed by Laws 2008, c. 184, &sect; 32, eff. July 1, 2008.&nbsp;</span></p> <p><span class="cls0">&sect;36-1435.36. Certain information to be included on license - Term of license.&nbsp;</span></p> <p><span class="cls0">A. The name, mailing address of the licensee, expiration date, the line or lines of insurance coverage by the license, and such other information as the Commissioner deems proper for inclusion in the license shall be indicated on the license.&nbsp;</span></p> <p><span class="cls0">B. All licenses issued pursuant to the provisions of the Insurance Agents Licensing Act shall continue in force not longer than twenty-four (24) months. The renewal dates for the licenses may be staggered throughout the year by notifying licensees in writing of the expiration and renewal date being assigned to the licensees by the Commissioner and by making appropriate adjustment in the biennial licensing fee.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 65, eff. Nov. 1, 1997. Renumbered from &sect; 1424.16 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.37. Repealed by Laws 2008, c. 184, &sect; 32, eff. July 1, 2008.&nbsp;</span></p> <p><span class="cls0">&sect;36-1435.38. Repealed by Laws 2004, c. 274, &sect; 21, eff. July 1, 2004.&nbsp;</span></p> <p><span class="cls0">&sect;36-1435.39. Refusal of license - Fees not refundable.&nbsp;</span></p> <p><span class="cls0">A. If the Insurance Commissioner finds that the applicant has not fully met the requirements for licensing, the Commissioner shall refuse to issue the license and promptly notify the applicant and the appointing insurer, when applicable, in writing, of the denial, stating the grounds therefor.&nbsp;</span></p> <p><span class="cls0">B. If for any reason a license or appointment is not issued or renewed by the Commissioner, all fees accompanying the appointment or application for the license shall be deemed earned and shall not be refundable except as provided in Section 24 of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 418, &sect; 77, eff. Nov. 1, 1997. Renumbered from &sect; 1425.8 of this title by Laws 2001, c. 156, &sect; 35, eff. Nov. 1, 2001.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.40. Applicants for licensure &ndash; Certain government employees barred.&nbsp;</span></p> <p><span class="cls0">A. Except as provided in subsections B and C of this section, an applicant for licensure shall not be a full-time employee of the government of the United States or of the executive or administrative branches of the government of this state or any county or municipality of this state.&nbsp;</span></p> <p><span class="cls0">B. The provisions of subsection A of this section shall not apply to:&nbsp;</span></p> <p><span class="cls0">1. Applicants for life or accident and health insurance producer licenses or limited lines producers; or&nbsp;</span></p> <p><span class="cls0">2. Persons who hold an elective office, except the office of Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">C. For the purpose of this section, a teacher shall not be considered a full-time employee of the executive or administrative branches of the government of the state or of any county or municipality of the state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2002, c. 307, &sect; 21, eff. Nov. 1, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1435.41. Providing insurance policy information - Exception.&nbsp;</span></p> <p><span class="cls0">A. An insurer shall provide to any insurance producer authorized to sell life, accident or health insurance products, whose appointment has been terminated for any reason other than the reasons set forth in Section 1435.13 of this title, information relating to the policy of the person who purchased a product from such producer if the insured has signed a form authorizing the release of the information.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner shall prescribe the form required by subsection A of this section. The form shall be in compliance with federal and state laws and regulations relating to privacy.&nbsp;</span></p> <p><span class="cls0">C. This section shall not apply to any policy sold or serviced by the insurance producer while associated with the insurer's captive distribution system.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2010, c. 201, &sect; 1, eff. Nov. 1, 2010. Amended by Laws 2013, c. 224, &sect; 3, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;361441. Short title.&nbsp;</span></p> <p><span class="cls0">Sections 1 through 13 of this act shall be known and may be cited as the "Thirdparty Administrator Act".&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1983, c. 89, &sect; 1, eff. Nov. 1, 1983. &nbsp;</span></p> <p><span class="cls0">&sect;361441.1. Administrator of certain group selfinsurance associations exempted from act.&nbsp;</span></p> <p><span class="cls0">The provisions of Section 1441 et seq. of Title 36 of the Oklahoma Statutes shall not apply to administrators of group selfinsurance associations created pursuant to Section 149.2 of Title 85 of the Oklahoma Statutes.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1988, c. 164, &sect; 1, emerg. eff. May 18, 1988. &nbsp;</span></p> <p><span class="cls0">&sect;36-1442. Definitions.&nbsp;</span></p> <p class="cls15"><span class="cls0">Text effective until January 1, 2015&nbsp;</span></p> <p class="cls15"><span class="cls0">(for text effective beginning January 1, 2015, see below)&nbsp;</span></p> <p><span class="cls0">As used in the Third-party Administrator Act, Section 1441 et seq. of this title:&nbsp;</span></p> <p><span class="cls0">1. "Administrator" means any person who collects premiums for an insurer or trust or who adjusts or settles claims for an insurer or trust, in connection with life or health insurance coverage, annuities or employee benefit stop loss in this state, but shall not include any person who collects premiums or who adjusts or settles claims under the following circumstances:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;any employer on behalf of the employees of that employer or the employees of one or more subsidiary or affiliated corporations of that employer,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;a union on behalf of its members,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;an insurance company which is licensed to transact insurance business in this state,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;a wholly owned subsidiary of an entity which is subject to the jurisdiction of the Insurance Commissioner,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;an insurance company acting as an insurer with respect to a policy lawfully issued and delivered by said company in and pursuant to the laws of this state,&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;a hospital, medical, dental, or optometric service corporation or a health care service organization, including their agents, authorized by the Commissioner to issue contracts in this state pursuant to the provisions of the Oklahoma Insurance Code when engaged in the performance of their duties,&nbsp;</span></p> <p class="cls2"><span class="cls0">g.&nbsp;&nbsp;a life or disability agent or broker who is licensed in this state and whose activities are limited exclusively to the sale of insurance,&nbsp;</span></p> <p class="cls2"><span class="cls0">h.&nbsp;&nbsp;an adjuster licensed in this state for the kinds of business for which he is acting as an adjuster,&nbsp;</span></p> <p class="cls2"><span class="cls0">i.&nbsp;&nbsp;a creditor insuring a debt between the creditor and its debtors on behalf of said creditor's debtors,&nbsp;</span></p> <p class="cls2"><span class="cls0">j.&nbsp;&nbsp;a financial institution which is subject to supervision or examination by federal or state banking authorities,&nbsp;</span></p> <p class="cls2"><span class="cls0">k.&nbsp;&nbsp;a company which issues credit cards and advances credit for and collects premiums or charges from its credit card holders who have authorized said collection, if the company does not adjust or settle claims,&nbsp;</span></p> <p class="cls2"><span class="cls0">l.&nbsp;&nbsp;a person who adjusts or settles claims in the normal course of practice or employment as an attorney-at-law and who does not collect charges or premiums in connection with life or health insurance coverage or annuities,&nbsp;</span></p> <p class="cls2"><span class="cls0">m.&nbsp;&nbsp;the State Insurance Fund,&nbsp;</span></p> <p class="cls2"><span class="cls0">n.&nbsp;&nbsp;any workers' compensation trust, or&nbsp;</span></p> <p class="cls2"><span class="cls0">o.&nbsp;&nbsp;a trust providing benefits to the employees of any political subdivision of a city, county or the state; and&nbsp;</span></p> <p><span class="cls0">2. "Trust" means any trust other than those exempted in paragraph 1 of this section which engages in the business of making contracts of insurance.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 89, &sect; 2, eff. Nov. 1, 1983. Amended by Laws 1984, c. 173, &sect; 5, emerg. eff. May 7, 1984; Laws 1987, c. 175, &sect; 15, eff. Nov. 1, 1987; Laws 2008, c. 184, &sect; 15, eff. July 1, 2008.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls15"><span class="cls0">Text effective beginning January 1, 2015&nbsp;</span></p> <p><span class="cls0">As used in the Third-party Administrator Act, Section 1441 et seq. of this title:&nbsp;</span></p> <p><span class="cls0">1. "Administrator" means any person who collects premiums for an insurer or trust or who adjusts or settles claims for an insurer or trust, in connection with life or health insurance coverage, annuities or employee benefit stop loss in this state, but shall not include any person who collects premiums or who adjusts or settles claims under the following circumstances:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;any employer on behalf of the employees of that employer or the employees of one or more subsidiary or affiliated corporations of that employer,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;a union on behalf of its members,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;an insurance company which is licensed to transact insurance business in this state,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;a wholly owned subsidiary of an entity which is subject to the jurisdiction of the Insurance Commissioner,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;an insurance company acting as an insurer with respect to a policy lawfully issued and delivered by said company in and pursuant to the laws of this state,&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;a hospital, medical, dental, or optometric service corporation or a health care service organization, including their agents, authorized by the Commissioner to issue contracts in this state pursuant to the provisions of the Oklahoma Insurance Code when engaged in the performance of their duties,&nbsp;</span></p> <p class="cls2"><span class="cls0">g.&nbsp;&nbsp;a life or disability agent or broker who is licensed in this state and whose activities are limited exclusively to the sale of insurance,&nbsp;</span></p> <p class="cls2"><span class="cls0">h.&nbsp;&nbsp;an adjuster licensed in this state for the kinds of business for which he is acting as an adjuster,&nbsp;</span></p> <p class="cls2"><span class="cls0">i.&nbsp;&nbsp;a creditor insuring a debt between the creditor and its debtors on behalf of said creditor's debtors,&nbsp;</span></p> <p class="cls2"><span class="cls0">j.&nbsp;&nbsp;a financial institution which is subject to supervision or examination by federal or state banking authorities,&nbsp;</span></p> <p class="cls2"><span class="cls0">k.&nbsp;&nbsp;a company which issues credit cards and advances credit for and collects premiums or charges from its credit card holders who have authorized said collection, if the company does not adjust or settle claims,&nbsp;</span></p> <p class="cls2"><span class="cls0">l.&nbsp;&nbsp;a person who adjusts or settles claims in the normal course of practice or employment as an attorney-at-law and who does not collect charges or premiums in connection with life or health insurance coverage or annuities,&nbsp;</span></p> <p class="cls2"><span class="cls0">m.&nbsp;&nbsp;any workers' compensation trust, or&nbsp;</span></p> <p class="cls2"><span class="cls0">n.&nbsp;&nbsp;a trust providing benefits to the employees of any political subdivision of a city, county or the state; and&nbsp;</span></p> <p><span class="cls0">2. "Trust" means any trust other than those exempted in paragraph 1 of this section which engages in the business of making contracts of insurance.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 89, &sect; 2, eff. Nov. 1, 1983. Amended by Laws 1984, c. 173, &sect; 5, emerg. eff. May 7, 1984; Laws 1987, c. 175, &sect; 15, eff. Nov. 1, 1987; Laws 2008, c. 184, &sect; 15, eff. July 1, 2008; Laws 2013, c. 254, &sect; 26, eff. Jan. 1, 2015.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1443. Written agreement required - Examination, audit and inspection of records.&nbsp;</span></p> <p><span class="cls0">A. No person shall act as an administrator without a written agreement between that person and an insurer. The written agreement shall be retained as part of the official records of both the insurer and the administrator for the duration of the agreement and for five (5) years thereafter.&nbsp;</span></p> <p><span class="cls0">B. The written agreement required by the provisions of subsection A of this section shall contain provisions stating any of the requirements of the Third-party Administrator Act which apply to the functions performed by the administrator.&nbsp;</span></p> <p><span class="cls0">C. If a policy is issued to a trustee, a copy of the trust agreement and any amendments to the agreement shall be furnished to the insurer by the administrator and shall be retained as part of the official records of both the insurer and the administrator for the duration of the policy and for five (5) years thereafter.&nbsp;</span></p> <p><span class="cls0">D. Every administrator shall maintain at the principal administrative office of the administrator for the duration of the agreement and for five (5) years thereafter the written agreement required by the provisions of this section and records of all transactions among the administrator, insurers or trusts, and insured persons.&nbsp;</span></p> <p><span class="cls0">E. 1. For the purposes of examination, audit, and inspection, the Insurance Commissioner or any other person in the course of examination, audit and inspection shall have access to books and records maintained by the administrator. Any trade secrets contained in these books and records, including the identity and addresses of policyholders and certificate holders, shall be confidential.&nbsp;</span></p> <p><span class="cls0">2. All work papers, recorded information, documents and copies thereof produced or obtained by or disclosed to the Commissioner or other person in the course of examination, audit and inspection made pursuant to this section, or in the course of analysis by the Commissioner or other person in the course of examination, audit and inspection, shall be given confidential treatment by the Commissioner and may not be made public by the Commissioner or any other person who obtained the information in the course of the examination, audit and inspection, except to the extent provided in this section. Access may be granted to the National Association of Insurance Commissioners. The parties shall agree in writing prior to receiving the information to provide to it the same confidential treatment as required by this section, unless the prior written consent of the company to which it pertains has been obtained. The confidentiality and protection from discovery by subpoena provided for in this paragraph shall not be construed to be extended to identical, similar or other related documents or information or to the work papers that are not deemed to be in the possession, custody or control of the Commissioner.&nbsp;</span></p> <p><span class="cls0">3. The Commissioner may use this information in any proceedings instituted against the administrator.&nbsp;</span></p> <p><span class="cls0">F. The insurer or trust shall have the right of continuing access to books and records maintained by the administrator sufficient to permit the insurer or trust to fulfill all of its contractual obligations to insured persons, subject to any restriction in the written agreement between the insurer or trust and the administrator concerning the proprietary rights of the parties to said books and records.&nbsp;</span></p> <p><span class="cls0">G. The agreement required by the provisions of this section shall include provisions stating the underwriting standards or other standards pertaining to the business underwritten by the insurer or trust.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 89, &sect; 3, eff. Nov. 1, 1983. Amended by Laws 2010, c. 356, &sect; 5, eff. Nov. 1, 2010; Laws 2012, c. 149, &sect; 3, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;361444. Payments to administrator Rights against administrator.&nbsp;</span></p> <p><span class="cls0">If an insurer or trust utilizes the services of an administrator pursuant to the terms of a written agreement, the payment to the administrator of any premiums or charges for insurance by or on behalf of the insured shall be deemed to have been received by the insurer or trust. The payment of return premiums or claims by the insurer or trust to the administrator shall not be deemed payment to the insured or claimant until the payments are received by the insured or claimant. Nothing in the Thirdparty Administrator Act shall limit any right of the insurer or trust against the administrator resulting from failure of the administrator to make payments to the insurer or trust, insureds, or claimants.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1983, c. 89, &sect; 4, eff. Nov. 1, 1983. &nbsp;</span></p> <p><span class="cls0">&sect;361445. Fiduciary capacity and duties of administrator.&nbsp;</span></p> <p><span class="cls0">A. All insurance charges or premiums collected by an administrator for an insurer or trust and all return premiums received from the insurer or trust shall be held by the administrator in a fiduciary capacity. These funds shall be immediately remitted to the person entitled to the funds or shall be deposited promptly in a fiduciary bank account established and maintained by the administrator.&nbsp;</span></p> <p><span class="cls0">B. If charges or premiums deposited in a fiduciary account have been collected for more than one insurer or trust, the administrator shall keep records showing the deposits to and withdrawals from the account for each insurer or trust. The administrator, upon request of an insurer or trust, shall furnish copies of the records pertaining to deposits to and withdrawals from the account for that insurer or trust.&nbsp;</span></p> <p><span class="cls0">C. The administrator shall not pay any claim by withdrawals from a fiduciary account unless provisions for said withdrawals are included in the written agreement between the insurer or trust and the administrator. The written agreement shall authorize withdrawals by the administrator from the fiduciary account only for:&nbsp;</span></p> <p><span class="cls0">1. remittance to an insurer or trust entitled to a remittance; or&nbsp;</span></p> <p><span class="cls0">2. deposit in an account maintained in the name of an insurer or trust; or&nbsp;</span></p> <p><span class="cls0">3. transfer to and deposit in an account established for payment of claims, as provided for by subsection D of this section; or&nbsp;</span></p> <p><span class="cls0">4. payment to a group policyholder for remittance to the insurer or trust entitled to such remittance; or&nbsp;</span></p> <p><span class="cls0">5. payment of commission, fees, or charges to the administrator; or&nbsp;</span></p> <p><span class="cls0">6. remittance of return premiums to the person entitled to such return premiums.&nbsp;</span></p> <p><span class="cls0">D. All claims paid by the administrator from funds collected on behalf of the insurer or trust shall be paid on drafts or checks authorized by the insurer or trust.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1983, c. 89, &sect; 5, eff. Nov. 1, 1983. &nbsp;</span></p> <p><span class="cls0">&sect;361446. Advertising.&nbsp;</span></p> <p><span class="cls0">An administrator shall obtain approval from an insurer or trust before publishing any advertising pertaining to the business underwritten by the insurer or trust. For purposes of this section, "publication" includes mailing of advertising material.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1983, c. 89, &sect; 6, eff. Nov. 1, 1983. &nbsp;</span></p> <p><span class="cls0">&sect;361447. Delivery of written communications to administrator Compensation of administrator Use of licensed agents.&nbsp;</span></p> <p><span class="cls0">A. Any policies, certificates, booklets, termination notices, or other written communications delivered by the insurer or trust to the administrator for delivery to policyholders shall be delivered by the administrator promptly after receipt of instructions to do so from the insurer or trust.&nbsp;</span></p> <p><span class="cls0">B. Compensation to an administrator for any policies for which the administrator adjusts or settles claims shall not be contingent upon claims experience. The provisions of this subsection shall not prevent basing the compensation of an administrator on the amount of premiums or charges collected or number of claims paid or processed or the number of covered insureds.&nbsp;</span></p> <p><span class="cls0">C. An administrator shall only use licensed insurance agents to do the business of insurance for trusts or insurers administered by the thirdparty administrator.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1983, c. 89, &sect; 7, eff. Nov. 1, 1983. Amended by Laws 1987, c. 175, &sect; 16, eff. Nov. 1, 1987. &nbsp;</span></p> <p><span class="cls0">&sect;36-1448. Administrator's bond - Amount - Requirements - Purpose - limits of cumulative liability - Cancellation.&nbsp;</span></p> <p><span class="cls0">A. Every administrator shall be bonded.&nbsp;</span></p> <p><span class="cls0">B. Prior to issuance of a license as an administrator, the applicant shall file with the Insurance Commissioner and thereafter keep in effect as long as the license remains in effect, a surety bond in an amount sufficient to protect those with whom the administrator deals, as determined by the Insurance Commissioner, which amount shall not be less than Ten Thousand Dollars ($10,000.00), and in a form acceptable to the Insurance Commissioner. The bond is intended to secure performance of the administrator in conformity with the laws, rules and regulations governing thirdparty administrators. The bond shall be for the benefit of parties injured by the actions of the administrator.&nbsp;</span></p> <p><span class="cls0">C. In no event shall the cumulative liability of the Surety be more than the penal sum of the bond. In no event shall the Surety cancel the bond without first giving thirty (30) days' written notice to the principal and the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 89, &sect; 8, eff. Nov. 1, 1983. Amended by Laws 1987, c. 172, &sect; 2, eff. Nov. 1, 1987; Laws 1988, c. 164, &sect; 2, emerg. eff. May 18, 1988; Laws 1997, c. 418, &sect; 82, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361449. Notice and information to be provided to insured individuals.&nbsp;</span></p> <p><span class="cls0">A. If the services of an administrator are utilized, the administrator shall provide a written notice to insured individuals advising them of the identities of the administrator, the policyholder, and the insurer or trust.&nbsp;</span></p> <p><span class="cls0">B. If an administrator collects funds from insured individuals, the administrator, upon request from an insured individual, shall furnish written information as to the amount of any charge or premium specified by the insurer or trust for insurance coverage for the insured individual. This information shall be furnished within ten (10) days after the administrator receives the request for information.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Added by Laws 1983, c. 89, &sect; 9, eff. Nov. 1, 1983. &nbsp;</span></p> <p><span class="cls0">&sect;36-1450. Licensing procedure - Violations.&nbsp;</span></p> <p><span class="cls0">A. No person shall act as or present himself or herself to be an administrator, as defined by the provisions of the Thirdparty Administrator Act, in this state, unless the person holds a valid license as an administrator which is issued by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">B. An administrator shall not be eligible for a nonresident administrator license under this section if the administrator does not hold a home state certificate of authority or license in a state that has adopted the Third-party Administrator Act or that applies substantially similar provisions as are contained in the Third-party Administrator Act to that administrator. If the Third-party Administrator Act in the administrator&rsquo;s home state does not extend to stop-loss insurance, but if the home state otherwise applies substantially similar provisions as are contained in the Third-party Administrator Act to that administrator, then that omission shall not operate to disqualify the administrator from receiving a nonresident administrator license in this state.&nbsp;</span></p> <p><span class="cls0">1. &ldquo;Home state&rdquo; means the United States jurisdiction that has adopted the Third-party Administrator Act or a substantially similar law governing third-party administrators and which has been designated by the administrator as its principal regulator. The administrator may designate either its state of incorporation or its principal place of business within the United States if that jurisdiction has adopted the Third-party Administrator Act or a substantially similar law governing third-party administrators. If neither the administrator&rsquo;s state of incorporation nor its principal place of business within the United States has adopted the Third-party Administrator Act or a substantially similar law governing third-party administrators, then the third-party administrator shall designate a United States jurisdiction in which it does business and which has adopted the Third-party Administrator Act or a substantially similar law governing third-party administrators. For purposes of this definition, &ldquo;United States jurisdiction&rdquo; means the District of Columbia or a state or territory of the United States.&nbsp;</span></p> <p><span class="cls0">2. &ldquo;Nonresident administrator&rdquo; means a person who is applying for licensure or is licensed in any state other than the administrator&rsquo;s home state.&nbsp;</span></p> <p><span class="cls0">C. In the case of a partnership which has been licensed, each general partner shall be named in the license and shall qualify therefore as though an individual licensee. The Commissioner shall charge a full additional license fee and a separate license shall be issued for each individual so named in such a license. The partnership shall notify the Commissioner within fifteen (15) days if any individual licensed on its behalf has been terminated, or is no longer associated with or employed by the partnership. Any entity or partnership licensed as administrators under the Third-party Administrators Act shall provide National Association of Insurance Commissioner Biographical Affidavits as required for domestic insurers pursuant to the insurance laws of this state.&nbsp;</span></p> <p><span class="cls0">D. An application for an administrator's license shall be in a form prescribed by the Commissioner and shall be accompanied by a fee of One Hundred Dollars ($100.00). This fee shall not be refundable if the application is denied or refused for any reason by either the applicant or the Commissioner.&nbsp;</span></p> <p><span class="cls0">E. The administrator's license shall continue in force no longer than twelve (12) months from the original month of issuance. Upon filing a renewal form prescribed by the Commissioner, accompanied by a fee of One Hundred Dollars ($100.00), the license may be renewed annually for a one-year term. Late application for renewal of a license shall require a fee of double the amount of the original license fee. The administrator shall submit, together with the application for renewal, a list of the names and addresses of the persons with whom the administrator has contracted in accordance with Section 1443 of this title. The Commissioner shall hold this information confidential except as provided in Section 1443 of this title.&nbsp;</span></p> <p><span class="cls0">F. The administrator's license shall be issued or renewed by the Commissioner unless, after notice and opportunity for hearing, the Commissioner determines that the administrator is not competent, trustworthy, or financially responsible, or has had any insurance license denied for cause by any state, has been convicted or has pleaded guilty or nolo contendere to any felony or to a misdemeanor involving moral turpitude or dishonesty.&nbsp;</span></p> <p><span class="cls0">G. After notice and opportunity for hearing, and upon determining that the administrator has violated any of the provisions of the Oklahoma Insurance Code or upon finding reasons for which the issuance or nonrenewal of such license could have been denied, the Commissioner may either suspend or revoke an administrator's license or assess a civil penalty of not more than Five Thousand Dollars ($5,000.00) for each occurrence. The payment of the penalty may be enforced in the same manner as civil judgments may be enforced.&nbsp;</span></p> <p><span class="cls0">H. Any person who is acting as or presenting himself or herself to be an administrator without a valid license shall be subject, upon conviction, to a fine of not less than One Thousand Dollars ($1,000.00) nor more than Ten Thousand Dollars ($10,000.00) for each occurrence. This fine shall be in addition to any other penalties which may be imposed for violations of the Oklahoma Insurance Code or other laws of this state.&nbsp;</span></p> <p><span class="cls0">I. Except as provided for in subsections F and G of this section, any person convicted of violating any provisions of the Third-party Administrator Act shall be guilty of a misdemeanor and shall be subject to a fine of not more than One Thousand Dollars ($1,000.00).&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 89, &sect; 10, eff. Nov. 1, 1983. Amended by Laws 1984, c. 173, &sect; 6, emerg. eff. May 7, 1984; Laws 1985, c. 258, &sect; 4, eff. Nov. 1, 1985; Laws 1997, c. 418, &sect; 83, eff. Nov. 1, 1997; Laws 2004, c. 274, &sect; 10, eff. July 1, 2004; Laws 2008, c. 184, &sect; 16, eff. July 1, 2008; Laws 2009, c. 432, &sect; 14, eff. July 1, 2009.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1452. Annual report - Penalties for failure to file - Waiver.&nbsp;</span></p> <p><span class="cls0">A. On or before June 1 of each year, all licensed administrators shall file an annual report for the previous calendar year. The report shall have been reviewed by a certified public accountant who shall be independent of the administrator. The report shall be subscribed and sworn to by the president and attested to by the secretary or other proper officers substantiating that the information contained in the report is true and factual concerning each of the plans they administer which are governed pursuant to the provisions of the Third-party Administrator Act. The report shall include the name and address of each fund and a statement of fund equity, paid claims by the covered unit, the accumulated year-to-date paid claims, and the year-to-date reserve status. Failure of any third-party administrator to execute and file the annual reports as required by this section shall constitute cause, after notice and opportunity for hearing, for censure, suspension, or revocation of administrator licensure to transact business in this state, or a civil penalty of not less than One Hundred Dollars ($100.00) or more than One Thousand Dollars ($1,000.00) for each occurrence, or both censure, suspension, or revocation and civil penalty.&nbsp;</span></p> <p><span class="cls0">B. If a licensed administrator has had no business or activity in the past calendar year, has not administered any insurance plans or business in the past calendar year and no funds are under the licensed administrator's oversight and administration, then the annual report described in subsection A of this section may be waived upon application to the Commissioner by the administrator. Upon applying for a waiver, the administrator shall state under oath that the administrator has had no business, has not administered any funds and the licensee's administration of claims has been dormant for the past calendar year. The application must be submitted no later than May 1st on the form prescribed by the Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 89, &sect; 12, eff. Nov. 1, 1983. Amended by Laws 1994, c. 129, &sect; 6, eff. Sept. 1, 1994; Laws 1997, c. 418, &sect; 84, eff. Nov. 1, 1997; Laws 2002, c. 307, &sect; 22, eff. Nov. 1, 2002; Laws 2007, c. 125, &sect; 16, eff. July 1, 2007; Laws 2010, c. 222, &sect; 25, eff. Nov. 1, 2010; Laws 2013, c. 269, &sect; 2, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1453. Repealed by Laws 1997, c. 418, &sect; 125, eff. Nov. 1, 1997.&nbsp;</span></p> <p><span class="cls0">&sect;36-1461. Short title.&nbsp;</span></p> <p><span class="cls0">Sections 1 through 6 of this act shall be known and may be cited as the "Oklahoma Life, Accident and Health Insurance Broker Act".&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 165, &sect; 1, eff. Nov. 1, 1983.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1462. Life or accident and health insurance broker defined - Liability.&nbsp;</span></p> <p><span class="cls0">A. For purposes of the Oklahoma Life, Accident and Health Insurance Broker Act, "life or accident and health insurance broker" means an individual or legal entity who, for compensation, not being a licensed life or accident and health insurance agent or agency for the company in which a policy of life or accident and health insurance is placed, acts or aids in any manner in negotiating contracts of life or accident and health insurance or placing risks or effecting life or accident and health insurance for a party other than himself or herself. An individual or legal entity not licensed as a life or accident and health insurance broker who solicits a policy of life or accident and health insurance on behalf of others or transmits for others an application for a policy of life or accident and health insurance to or from an insurance company or offers or assumes to act in the negotiations of said life or accident and health insurance shall be a life or accident and health insurance broker for the purposes of the Oklahoma Life, Accident and Health Insurance Broker Act and shall be liable for all the duties, requirements, liabilities, and penalties to which said licensed life or accident and health insurance brokers are subject.&nbsp;</span></p> <p><span class="cls0">B. Insurers for whom a life or accident and health insurance broker acts shall be liable for said life or accident and health insurance broker's actions as if said life or accident and health insurance broker were directly employed by the insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 165, &sect; 2, eff. Nov. 1, 1983. Amended by Laws 1997, c. 418, &sect; 85, eff. Nov. 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1463. License required.&nbsp;</span></p> <p><span class="cls0">No person or corporation shall act as or hold himself out to be a life or accident and health insurance broker until said person or corporation has procured a license as required by the Oklahoma Life, Accident and Health Insurance Broker Act, and no life or accident and health insurance broker shall solicit or take applications for, promise, or place for others any kind of insurance for which said life or accident and health insurance broker is not licensed.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 165, &sect; 3, eff. Nov. 1, 1983.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1464. Requirements for licensure - Fees - Errors and omissions policy - Violations, fines and penalties.&nbsp;</span></p> <p><span class="cls0">A. 1. To be licensed as a resident life or accident and health insurance broker, an individual or legal entity shall have been a licensed resident agent or agency in this state continuously for at least two (2) years immediately prior to application and such agent's license shall remain in effect in order to maintain the broker's license. A nonresident life or accident and health insurance broker applicant may receive a license in this state if they are licensed and in good standing in their home state, and if the home state of the applicant awards nonresident licenses to residents of this state on the same basis.&nbsp;</span></p> <p><span class="cls0">2. Any applicant for a broker's license shall have no Oklahoma Insurance Code violations or record with the Insurance Commissioner or an insurance regulatory body of another state and shall not have been convicted, or pleaded guilty or nolo contendere to any felony or to a misdemeanor involving moral turpitude or dishonesty.&nbsp;</span></p> <p><span class="cls0">3. The fee for a life or accident and health insurance broker's license shall be Fifty Dollars ($50.00). The license may be renewed each year for the same fee. Late application for renewal of a license shall require a fee of double the amount of the original current license fee. The fees shall be placed in the State Insurance Commissioner Revolving Fund.&nbsp;</span></p> <p><span class="cls0">B. 1. Every applicant for a life or accident and health insurance broker's license shall file with the Commissioner and, upon approval of the application, maintain in force while licensed and for at least two (2) years following termination of the license, evidence satisfactory to the Commissioner of an errors and omissions policy covering the individual applicant in an amount of not less than One Hundred Thousand Dollars ($100,000.00) annual aggregate for all claims made during the policy period, or covering the applicant under a blanket liability policy insuring other life or accident and health insurance agents or brokers in an amount of not less than Five Hundred Thousand Dollars ($500,000.00) annual aggregate for all claims made during the policy period.&nbsp;</span></p> <p><span class="cls0">2. Such policy shall be issued by an insurance company authorized to do business in this state, shall be continuous in form, and shall provide coverage acceptable to the Commissioner for errors and omissions of the life or accident and health insurance broker. The policy carrier shall notify the Commissioner of any lapse or termination of errors and omissions coverage.&nbsp;</span></p> <p><span class="cls0">3. Failure to maintain a policy in force shall result in automatic termination of licensure, and the license shall be returned by its lawful custodian to the Commissioner for further cancellation.&nbsp;</span></p> <p><span class="cls0">C. Life or accident and health insurance brokers shall be subject to the same violations, fines, and penalties as stated in Section 1435.13 of this title. Violations of the provisions of the Oklahoma Life, Accident and Health Insurance Broker Act may result, after notice and hearing, in censure, suspension, or revocation of license or a civil penalty of not less than One Hundred Dollars ($100.00), nor more than One Thousand Dollars ($1,000.00), or a combination thereof for each occurrence.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 165, &sect; 4, eff. Nov. 1, 1983. Amended by Laws 1984, c. 173, &sect; 7, emerg. eff. May 7, 1984; Laws 1985, c. 258, &sect; 5, eff. Nov. 1, 1985; Laws 1997, c. 418, &sect; 86, eff. Nov. 1, 1997; Laws 2010, c. 222, &sect; 26, eff. Nov. 1, 2010; Laws 2013, c. 269, &sect; 3, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1465. Compensation - Fiduciary duties.&nbsp;</span></p> <p><span class="cls0">A. Money, commissions, brokerages, or allowances of anything of value, including service fees, for or on account of solicitation for or negotiation or effecting of policies or contracts for life or accident and health insurance may be paid by:&nbsp;</span></p> <p><span class="cls0">1. a company duly licensed to do business in this state only to its duly licensed agent or agency or to a duly licensed life or accident and health insurance broker; or&nbsp;</span></p> <p><span class="cls0">2. an agent or agency only to a duly licensed agent or agency for the same company acting under his direct supervision, or to a duly licensed life or accident and health insurance broker; or&nbsp;</span></p> <p><span class="cls0">3. a life or accident and health insurance broker only to a duly licensed life or accident and health insurance broker.&nbsp;</span></p> <p><span class="cls0">B. Nothing in this section shall be construed as prohibiting the payment of renewal commissions on lawfully written life insurance.&nbsp;</span></p> <p><span class="cls0">C. Nothing in this section shall be construed as prohibiting the payment of compensation to licensed agents or agencies for other services rendered not involving the solicitation for or negotiation or effecting of policies or contracts for insurance.&nbsp;</span></p> <p><span class="cls0">D. No life or accident and health insurance broker shall have any right to compensation, other than commissions deductible from premiums on life or accident and health insurance policies or contracts for life or accident and health insurance, from any insured or prospective insured for or on account of the negotiation or procurement of or other services in connection with any policy or contract for life or accident and health insurance made or negotiated in this state, unless said right to compensation is based upon a written memorandum signed by the party to be charged, and specifying clearly the amount or extent of said compensation. Nothing herein contained shall affect the right of any said life or accident and health insurance broker to recover from the insured the amount of any premium or premiums for insurance effected by or through said life or accident and health insurance broker.&nbsp;</span></p> <p><span class="cls0">E. Every life or accident and health insurance broker acting as such in this state shall be responsible in a fiduciary capacity for all funds received or collected as a life or accident and health insurance broker and shall not mingle any such funds, without the express consent of his principal, with the broker's own funds or with funds held by the life or accident and health insurance broker in any other capacity. Nothing in this section shall be construed to require any broker to maintain a separate bank deposit if the funds of each principal are clearly ascertainable from the books of account and records of the life or accident and health insurance broker.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 165, &sect; 5, eff. Nov. 1, 1983.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1466. Rules and regulations.&nbsp;</span></p> <p><span class="cls0">The Commissioner is hereby authorized to adopt such rules and regulations as may be necessary to implement the provisions of the Oklahoma Life, Accident and Health Insurance Broker Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1983, c. 165, &sect; 6, eff. Nov. 1, 1983.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1471. Short title.&nbsp;</span></p> <p><span class="cls0">This act shall be known and may be cited as the "Managing General Agents Act".&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 134, &sect; 1, eff. July 1, 1991.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1472. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in this act:&nbsp;</span></p> <p><span class="cls0">1. "Actuary" means a person who is a member in good standing of the American Academy of Actuaries;&nbsp;</span></p> <p><span class="cls0">2. "Insurer" means any person licensed pursuant to the Oklahoma Insurance Code to transact insurance;&nbsp;</span></p> <p class="cls2"><span class="cls0">3.&nbsp;&nbsp;a.&nbsp;&nbsp;"Managing General Agent" or "MGA" means any person who:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;manages all or part of the insurance business of an insurer, including the management of a separate division, department or underwriting office, and&nbsp;</span></p> <p class="cls3"><span class="cls0"> (2)&nbsp;&nbsp;acts as an agent for such insurer, whether known as a managing general agent, manager or other similar term, and&nbsp;</span></p> <p class="cls3"><span class="cls0"> (3)&nbsp;&nbsp;directly or indirectly, with or without the authority of the insurer, whether separately or together with affiliates, produces and underwrites an amount of gross direct written premium equal to or greater than five percent (5%) of the policyholder surplus, as reported in the last annual statement of the insurer in any one quarter or year together with the following activities related to the business produced:&nbsp;</span></p> <p class="cls12"><span class="cls0">(a)&nbsp;&nbsp;adjusts or pays claims in excess of an amount determined by the Insurance Commissioner, or&nbsp;</span></p> <p class="cls12"><span class="cls0">(b)&nbsp;&nbsp;negotiates reinsurance on behalf of the insurer.&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;Notwithstanding subparagraph a of this paragraph, the following persons shall not be considered to be managing general agents for the purpose of this act:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;an employee of the insurer,&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;a U.S. Manager of the United States branch of an alien insurer,&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;an underwriting manager which, pursuant to contract:&nbsp;</span></p> <p class="cls12"><span class="cls0">(a)&nbsp;&nbsp;manages all the insurance operations of the insurer,&nbsp;</span></p> <p class="cls12"><span class="cls0">(b)&nbsp;&nbsp;is under common control with the insurer, subject to the holding company regulatory act, and&nbsp;</span></p> <p class="cls12"><span class="cls0">(c)&nbsp;&nbsp;whose compensation is not based on the volume of premiums written, and&nbsp;</span></p> <p class="cls3"><span class="cls0">(4)&nbsp;&nbsp;the attorney-in-fact authorized by and acting for the subscribers of a reciprocal insurer or interinsurance exchange under powers of an attorney;&nbsp;</span></p> <p><span class="cls0">4. "Underwrite" means the authority to accept or reject risk on behalf of the insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 134, &sect; 2, eff. July 1, 1991. Amended by Laws 1992, c. 65, &sect; 3, eff. Sept. 1, 1992.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1473. Agent license - Bond - Errors and omissions policy.&nbsp;</span></p> <p><span class="cls0">A. No person shall act in the capacity of a managing general agent with respect to risks located in this state for an insurer unless such person is licensed as a producer pursuant to the Oklahoma Producer Licensing Act.&nbsp;</span></p> <p><span class="cls0">B. No person shall act in the capacity of a managing general agent, representing an insurer domiciled in this state with respect to risks located outside this state, unless such person is licensed as a producer pursuant to the Oklahoma Producer Licensing Act. Provided, such license may be a nonresident license.&nbsp;</span></p> <p><span class="cls0">C. The Insurance Commissioner may require a bond in the amount acceptable to the Commissioner for the protection of the insurer.&nbsp;</span></p> <p><span class="cls0">D. The Insurance Commissioner may require the managing general agent to maintain an errors and omissions policy.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 134, &sect; 3, eff. July 1, 1991. Amended by Laws 2012, c. 44, &sect; 4, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1474. Written contract with insurer required - Minimum provisions.&nbsp;</span></p> <p><span class="cls0">No person acting in the capacity of a managing general agent shall place business with an insurer unless there is in force a written contract between the parties which sets forth the responsibilities of each party, and where both parties share responsibility for a particular function, specifies the division of such responsibilities, and which contains the following minimum provisions:&nbsp;</span></p> <p><span class="cls0">1. The insurer may terminate the contract for cause upon thirty (30) days' written notice to the managing general agent and the Insurance Commissioner. The insurer may suspend the underwriting authority of the managing general agent during the pendency of any dispute regarding the cause for termination;&nbsp;</span></p> <p><span class="cls0">2. The managing general agent shall render accounts to the insurer detailing all transactions and shall remit all funds due under the contract to the insurer on not less than a monthly basis;&nbsp;</span></p> <p><span class="cls0">3. All funds collected for the account of an insurer shall be held by the managing general agent in a fiduciary capacity in a bank which is a member of the Federal Reserve System. This account shall be used for all payments on behalf of the insurer. The managing general agent may retain no more than three (3) months' estimated claims payment and allocated loss adjustment expenses;&nbsp;</span></p> <p><span class="cls0">4. Separate records of business written by the managing general agent shall be maintained. The insurer shall have access to and the right to copy all accounts and records related to its business in a form usable by the insurer. The Insurance Commissioner shall have access to all books, bank accounts and records of the managing general agent in a form usable to the Commissioner. Such records shall be retained according to the provisions of subsection E of Section 1435.13 of this title;&nbsp;</span></p> <p><span class="cls0">5. The contract may not be assigned in whole or part by the managing general agent;&nbsp;</span></p> <p><span class="cls0">6. The contract shall contain appropriate underwriting guidelines including:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the maximum annual premium volume,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the basis of the rates to be charged,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the types of risks which may be written,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;maximum limits of liability,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;applicable exclusions,&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;territorial limitations,&nbsp;</span></p> <p class="cls2"><span class="cls0">g.&nbsp;&nbsp;policy cancellation provisions, and&nbsp;</span></p> <p class="cls2"><span class="cls0">h.&nbsp;&nbsp;the maximum policy period;&nbsp;</span></p> <p><span class="cls0">7. The insurer shall have the right to cancel or not renew any policy of insurance subject to applicable laws and regulations;&nbsp;</span></p> <p><span class="cls0">8. If the contract permits the managing general agent to settle claims on behalf of the insurer:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;all claims must be reported to the company in a timely manner,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;a copy of the claim file shall be sent to the insurer at its request or as soon as it becomes known that the claim:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;has the potential to exceed a threshold determined by the Insurance Commissioner or exceeds the limit set by the company, whichever is less,&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;involves a coverage dispute,&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;may exceed the managing general agent's claims settlement authority,&nbsp;</span></p> <p class="cls3"><span class="cls0">(4)&nbsp;&nbsp;is open for more than six (6) months, or&nbsp;</span></p> <p class="cls3"><span class="cls0">(5)&nbsp;&nbsp;is closed by payment of an amount set by the Insurance Commissioner or an amount set by the company, whichever is less,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;all claim files will be the joint property of the insurer and managing general agent. However, upon an order of liquidation of the insurer, such files shall become the sole property of the insurer or its estate and the managing general agent shall have reasonable access to and the right to copy the files on a timely basis,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;any settlement authority granted to the managing general agent may be terminated for cause upon the insurer's written notice to the managing general agent or upon the termination of the contract. The insurer may suspend the settlement authority during the pendency of any dispute regarding the cause for termination, and&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;nothing in this section shall be construed to give the Insurance Commissioner authority to settle or adjust claims on behalf of the insurer;&nbsp;</span></p> <p><span class="cls0">9. Where electronic claim files are in existence, the contract shall address the timely transmission of the data;&nbsp;</span></p> <p><span class="cls0">10. If the contract provides for a sharing of interim profits by the managing general agent, and the managing general agent has the authority to determine the amount of the interim profits by establishing loss reserves or controlling claim payments, or in any other manner, interim profits will not be paid to the managing general agent on the lines of business written by the managing general agent until at least ninety-seven percent (97%) of the ultimate loss has been developed for those lines of business, based on an opinion of the actuary who certifies the adequacy of the loss reserves for the insurer;&nbsp;</span></p> <p><span class="cls0">11. The managing general agent shall not:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;bind reinsurance or retrocessions on behalf of the insurer, except that the managing general agent may bind facultative reinsurance contracts pursuant to obligatory facultative agreements if the contract with the insurer contains reinsurance underwriting guidelines including, for both reinsurance assumed and ceded:&nbsp;</span></p> <p class="cls3"><span class="cls0">(1)&nbsp;&nbsp;a list of reinsurers with which such automatic agreements are in effect,&nbsp;</span></p> <p class="cls3"><span class="cls0">(2)&nbsp;&nbsp;the coverages and amounts or percentages that may be reinsured, and&nbsp;</span></p> <p class="cls3"><span class="cls0">(3)&nbsp;&nbsp;commission schedules,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;commit the insurer to participate in insurance or reinsurance syndicates,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;appoint any agent or broker without assuring that the agent or broker is lawfully licensed to transact the type of insurance for which he is appointed,&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;without prior approval of the insurer, pay or commit the insurer to pay a claim over a specified amount, net of reinsurance, which shall not exceed one percent (1%) of the insurer's policyholder's surplus as of December 31 of the last completed calendar year,&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;collect any payment from a reinsurer or commit the insurer to any claim settlement with a reinsurer without prior approval of the insurer. If prior approval is given, a report shall be promptly forwarded to the insurer,&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;permit its sub-agent or sub-broker to serve on the insurer's board of directors,&nbsp;</span></p> <p class="cls2"><span class="cls0">g.&nbsp;&nbsp;jointly employ an individual who is employed with the insurer, or&nbsp;</span></p> <p class="cls2"><span class="cls0">h.&nbsp;&nbsp;appoint a sub-managing general agent.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 134, &sect; 4, eff. July 1, 1991. Amended by Laws 2002, c. 307, &sect; 23, eff. Nov. 1, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1475. Financial examination and on-site reviews - Binding authority for contracts - Notice of appointment or termination - Review of books and records - Appointments to board.&nbsp;</span></p> <p><span class="cls0">A. The insurer shall have on file an independent financial examination, in a form acceptable to the Insurance Commissioner, of each managing general agent with which it has done business.&nbsp;</span></p> <p><span class="cls0">B. The insurer shall periodically, at least semi-annually, conduct an on-site review of the underwriting and claims processing operations of the managing general agent.&nbsp;</span></p> <p><span class="cls0">C. Binding authority for all reinsurance contracts or participation in insurance or reinsurance syndicates shall rest with an officer of the insurer, who shall not be affiliated with the managing general agent.&nbsp;</span></p> <p><span class="cls0">D. Within thirty (30) days of entering into or termination of a contract with a managing general agent, the insurer shall provide written notification of such appointment or termination to the Insurance Commissioner. Notices of appointment of a managing general agent shall include:&nbsp;</span></p> <p><span class="cls0">1. A statement of duties which the applicant is expected to perform on behalf of the insurer;&nbsp;</span></p> <p><span class="cls0">2. The lines of insurance for which the applicant is to be authorized to act; and&nbsp;</span></p> <p><span class="cls0">3. Any other information the Commissioner may request.&nbsp;</span></p> <p><span class="cls0">E. An insurer shall review its books and records each quarter to determine if any agent or broker has become a managing general agent as defined in Section 2 of this act. If the insurer determines that an agent or broker has become a managing general agent, the insurer shall promptly notify the agent or broker and the Insurance Commissioner of such determination, and the insurer and agent or broker shall fully comply with the provisions of this act within thirty (30) days of such notification.&nbsp;</span></p> <p><span class="cls0">F. An insurer shall not appoint to its board of directors an officer, director, employee, sub-agent, sub-broker or controlling shareholder of its managing general agents. This subsection shall not apply to relationships governed by the insurance holding company act, Section 1651 et seq. of this title.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 134, &sect; 5, eff. July 1, 1991.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1476. Acts of managing general agent - Imputation to insurer.&nbsp;</span></p> <p><span class="cls0">The acts of the managing general agent are considered to be the acts of the insurer on whose behalf the agent is acting. A managing general agent may be examined as if the agent were the insurer.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 134, &sect; 6, eff. July 1, 1991.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1477. Violations - Penalties - Judicial review - Rights effected.&nbsp;</span></p> <p><span class="cls0">A. If the Insurance Commissioner finds, after a hearing conducted in accordance with Article II of the Administrative Procedures Act, that any person had violated any provision of the Managing General Agents Act or rules promulgated pursuant thereto, the Commissioner may order:&nbsp;</span></p> <p><span class="cls0">1. For each separate violation, a penalty in an amount of not less than One Hundred Dollars ($100.00) nor more than Five Thousand Dollars ($5,000.00) for each occurrence;&nbsp;</span></p> <p><span class="cls0">2. Revocation or suspension of the producer's license; and&nbsp;</span></p> <p><span class="cls0">3. The managing general agent to reimburse the insurer, the rehabilitator or the liquidator of the insurer for any losses incurred by the insurer which were caused by a violation of the Managing General Agents Act committed by the managing general agent.&nbsp;</span></p> <p><span class="cls0">B. The decision, determination or order of the Commissioner pursuant to subsection A of this section shall be subject to judicial review pursuant to the Administrative Procedures Act and any applicable insurance laws and regulations.&nbsp;</span></p> <p><span class="cls0">C. Nothing contained in this section shall affect the right of the Commissioner to impose any other penalties provided for in the Oklahoma Insurance Code.&nbsp;</span></p> <p><span class="cls0">D. Nothing contained in the Managing General Agents Act is intended to or shall, in any manner, limit or restrict the rights of policyholders, claimants and auditors.&nbsp;</span></p> <p><span class="cls0">E. No insurer may continue to utilize the services of a managing general agent on or after July 1, 1991, unless such utilization is in compliance with the Managing General Agents Act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 134, &sect; 7, eff. July 1, 1991. Amended by Laws 2012, c. 44, &sect; 5, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1478. Rules and regulations.&nbsp;</span></p> <p><span class="cls0">The Insurance Commissioner may adopt reasonable rules and regulations for the implementation and administration of the provisions of this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1991, c. 134, &sect; 8, eff. July 1, 1991.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361501. "Assets" defined.&nbsp;</span></p> <p><span class="cls0">In any determination of the financial condition of an insurer, there shall be allowed as assets only such assets as are owned by the insurer and which consist of:&nbsp;</span></p> <p><span class="cls0">1. Cash in the possession of the insurer, or in transit under its control, and including the true balance of any deposit in a solvent bank or trust company.&nbsp;</span></p> <p><span class="cls0">2. Investments, securities, properties and loans acquired or held in accordance with this Code, and in connection therewith the following items:&nbsp;</span></p> <p><span class="cls0">(a) Interest due or accrued on any bond or evidence of indebtedness which is not in default and which is not valued on a basis including accrued interest.&nbsp;</span></p> <p><span class="cls0">(b) Declared and unpaid dividends on stock and shares, unless such amount has otherwise been allowed as an asset.&nbsp;</span></p> <p><span class="cls0">(c) Interest due or accrued upon a collateral loan in an amount not to exceed one (1) year's interest thereon.&nbsp;</span></p> <p><span class="cls0">(d) Interest due or accrued on deposits in solvent banks and trust companies, and interest due or accrued on other assets, if such interest is in the judgment of the Insurance Commissioner a collectible asset.&nbsp;</span></p> <p><span class="cls0">(e) Interest due or accrued on a mortgage loan, in an amount not exceeding in any event the amount, if any, of the excess of the value of the property less delinquent taxes thereon over the unpaid principal; but in no event shall interest accrued for a period in excess of eighteen (18) months be allowed as an asset.&nbsp;</span></p> <p><span class="cls0">(f) Rent due or accrued on real property if such rent is not in arrears for more than three (3) months, and rent more than three (3) months in arrears if the payment of such rent be adequately secured by property held in the name of the tenant and conveyed to the insurer as collateral.&nbsp;</span></p> <p><span class="cls0">(g) The unaccrued portion of taxes paid prior to the due date on real property.&nbsp;</span></p> <p><span class="cls0">3. Premium notes, policy loans, and other policy assets and liens on policies and certificates of life insurance and annuity contracts and accrued interest thereon, in an amount not exceeding the legal reserve and other policy liabilities carried on each individual policy.&nbsp;</span></p> <p><span class="cls0">4. The net amount of uncollected and deferred premiums and annuity considerations in the case of a life insurer.&nbsp;</span></p> <p><span class="cls0">5. Premiums in the course of collection, other than for life insurance, not more than three (3) months past due, less commissions payable thereon. The foregoing limitation shall not apply to premiums payable directly or indirectly by the United States government or by any of its instrumentalities.&nbsp;</span></p> <p><span class="cls0">6. Installment premiums other than life insurance premiums to the extent of the unearned premium reserves carried thereon.&nbsp;</span></p> <p><span class="cls0">7. Notes and like written obligations not past due, taken for premiums other than life insurance premiums, on policies permitted to be issued on such basis, to the extent of the unearned premium reserves carried thereon.&nbsp;</span></p> <p><span class="cls0">8. The full amount of reinsurance recoverable by a ceding insurer from a solvent reinsurer and which reinsurance is authorized under Section 711 of Article 7 (Kinds of Insurance; Reinsurance; Limits of Risk).&nbsp;</span></p> <p><span class="cls0">9. Amounts receivable by an assuming insurer representing funds withheld by a solvent ceding insurer under a reinsurance treaty.&nbsp;</span></p> <p><span class="cls0">10. Deposits or equities recoverable from underwriting associations, syndicates and reinsurance funds, or from any suspended banking institution, to the extent deemed by the Insurance Commissioner available for the payment of losses and claims and at values to be determined by him.&nbsp;</span></p> <p><span class="cls0">11. All assets, whether or not consistent with the provisions of this section, as may be allowed pursuant to the annual statement form approved by the national association of insurance commissioners for the kinds of insurance to be reported upon therein.&nbsp;</span></p> <p><span class="cls0">12. Rebates determined and accrued pursuant to Section 2 of this act.&nbsp;</span></p> <p><span class="cls0">13. Other assets, not inconsistent with the provisions of this section, deemed by the Insurance Commissioner to be available for the payment of losses and claims, at values to be determined by the Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 280, &sect; 1501, operative July 1, 1957. Amended by Laws 2002, c. 31, &sect; 1, emerg. eff. April 10, 2002.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361502. Assets as deductions from liabilities.&nbsp;</span></p> <p><span class="cls0">Assets may be allowable as deductions from corresponding liabilities, and liabilities may be charged as deductions from assets, and deductions from assets may be charged as liabilities, in accordance with the form of annual statement applicable to such insurer as prescribed by the Insurance Commissioner, or otherwise in his discretion.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 281, &sect; 1502. &nbsp;</span></p> <p><span class="cls0">&sect;36-1503. Assets not allowed as deductions from liabilities.&nbsp;</span></p> <p><span class="cls0">In addition to assets impliedly excluded by the provisions of Section 1501 of this article, the following expressly shall not be allowed as assets in any determination of the financial condition of an insurer:&nbsp;</span></p> <p><span class="cls0">1. Trade names and other like intangible assets, excluding good will.&nbsp;</span></p> <p><span class="cls0">2. Advances to officers (other than policy loans) whether secured or not, and advances to employees, agents and other persons on personal security only.&nbsp;</span></p> <p><span class="cls0">3. Stock of such insurer, owned by it, or any equity therein or loans secured thereby, or any proportionate interest in such stock acquired or held through the ownership by such insurer of an interest in another firm, corporation or business unit.&nbsp;</span></p> <p><span class="cls0">4. Furniture, fixtures, furnishings, safes, vehicles, libraries, stationery, literature and supplies, except in the case of title insurers such materials and plants as the insurer is expressly authorized to invest in under Article 50 (Title Insurers) of this Code and except, in the case of any insurer, such personal property as the insurer is permitted to hold pursuant to Article 16 (Investments) of this Code, or which is reasonably necessary for the maintenance and operation of real estate lawfully acquired and held by the insurer other than real estate used by it for home office, branch office and similar purposes.&nbsp;</span></p> <p><span class="cls0">5. The amount, if any, by which the aggregate book value of investments as carried in the ledger assets of the insurer exceeds the aggregate value thereof as determined under this Code.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 281, &sect; 1503, operative July 1, 1957. Amended by Laws 2004, c. 334, &sect; 41, emerg. eff. May 25, 2004. &nbsp;</span></p> <p><span class="cls0">&sect;361504. Reporting assets not allowed.&nbsp;</span></p> <p><span class="cls0">All assets not allowed and all other assets of doubtful value or character included as assets in any statement by an insurer to the Insurance Commissioner, or in any examiner's report to said Commissioner, shall also be reported, to the extent of the value disallowed, as deductions from the gross assets of such insurer.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 281, &sect; 1504. &nbsp;</span></p> <p><span class="cls0">&sect;361505. Liabilities Mandatory securities valuation reserves.&nbsp;</span></p> <p><span class="cls0">A. In any determination of the financial condition of an insurer, capital stock and liabilities to be charged against its assets shall include:&nbsp;</span></p> <p><span class="cls0">1. The amount of its capital stock outstanding, if any.&nbsp;</span></p> <p><span class="cls0">2. The amount, estimated consistent with the provisions of this Code, necessary to pay all of its unpaid losses and claims incurred on or prior to the date of statement, whether reported or unreported, together with the expenses of adjustment or settlement thereof.&nbsp;</span></p> <p><span class="cls0">3. With reference to life and disability insurance and annuity contracts:&nbsp;</span></p> <p><span class="cls0">(a) The amount of reserves on life insurance policies and annuity contracts in force, valued according to the tables of mortality, rates of interest, and methods adopted pursuant to this Code which are applicable thereto,&nbsp;</span></p> <p><span class="cls0">(b) Reserves for disability benefits, for both active and disabled lives,&nbsp;</span></p> <p><span class="cls0">(c) Reserves for accidental death benefits, and&nbsp;</span></p> <p><span class="cls0">(d) Any additional reserves which may be required by the Insurance Commissioner consistent with practice formulated or approved by the National Association of Insurance Commissioners, on account of such insurance.&nbsp;</span></p> <p><span class="cls0">4. With reference to insurance other than specified in subsection 3 this section, and other than title insurance, the amount of reserves equal to the unearned portions of the gross premiums charged on policies in force, computed in accordance with this article.&nbsp;</span></p> <p><span class="cls0">5. Taxes, expenses and other obligations due or accrued at the date of the statement.&nbsp;</span></p> <p><span class="cls0">B. All life insurance companies and fraternal benefit societies shall establish and maintain mandatory securities valuation reserves in accordance with the guidelines established by the National Association of Insurance Commissioners. Life insurance companies without mandatory securities valuation reserves as of December 31, 1989, shall begin accruing twenty percent (20%) of the mandatory securities value reserves per year and have reserves in accordance with the required guidelines within five (5) years.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 281, &sect; 1505. &nbsp;</span></p> <p><span class="cls0">&sect;361506. Unearned premium reserve.&nbsp;</span></p> <p><span class="cls0">A. With reference to insurance against loss or damage to property (except as provided in Section 1507 of this article) and with reference to all general casualty insurance, and surety insurance, every insurer shall maintain an unearned premium reserve on all policies in force.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner may require that such reserves shall be equal to the unearned portions of the gross premiums in force after deducting reinsurance in solvent insurers as computed on each respective risk from the policy's date of issue. If the Insurance Commissioner does not so require, the portions of the gross premium in force, less reinsurance in solvent insurers to be held as a premium reserve, shall be computed according to the following table:&nbsp;</span></p> <p><span class="cls0">Term for Which Policy Reserve for Unearned&nbsp;</span></p> <p><span class="cls0">Was Written Premium&nbsp;</span></p> <p><span class="cls0">_____________________ _____________________&nbsp;</span></p> <p><span class="cls0">1 Year or less 1/2&nbsp;</span></p> <p><span class="cls0">2 Years 1st year 3/4&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;2nd year 1/4&nbsp;</span></p> <p class="cls14"><span class="cls0">3 Years&nbsp;&nbsp;&nbsp;&nbsp;1st year 5/6&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;2nd year 1/2&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;3rd year 1/6&nbsp;</span></p> <p class="cls14"><span class="cls0">4 Years&nbsp;&nbsp;&nbsp;&nbsp;1st year 7/8&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;2nd year 5/8&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;3rd year 3/8&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;4th year 1/8&nbsp;</span></p> <p class="cls14"><span class="cls0">5 Years&nbsp;&nbsp;&nbsp;&nbsp;1st year 9/10&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;2nd year 7/10&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;3rd year 1/2&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;4th year 3/10&nbsp;</span></p> <p class="cls14"><span class="cls0">&nbsp;&nbsp;5th year 1/10&nbsp;</span></p> <p><span class="cls0">Over 5 years pro rata&nbsp;</span></p> <p><span class="cls0">C. Unearned premium reserves on policies written for an intermediate period shall be calculated at the succeeding longer period or on a monthly pro rata basis.&nbsp;</span></p> <p><span class="cls0">D. In lieu of computation according to the foregoing table, all of such reserves may be computed, at the option of the insurer, on a monthly or more frequent pro rata basis.&nbsp;</span></p> <p><span class="cls0">E. After adopting a method for computing such reserve, an insurer shall not change methods without approval of the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">F. This section does not apply to title insurance.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 282, &sect; 1506. &nbsp;</span></p> <p><span class="cls0">&sect;361507. Unearned premium reserve for marine insurance.&nbsp;</span></p> <p><span class="cls0">With reference to marine insurance, premiums on trip risks not terminated shall be deemed unearned, and the Insurance Commissioner may require the insurer to carry a reserve thereon equal to one hundred percent (100%) on trip risks written during the month ended as of the date of statement.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 282, &sect; 1507. &nbsp;</span></p> <p><span class="cls0">&sect;361508. Reserves for accident and health insurance.&nbsp;</span></p> <p><span class="cls0">For all accident and health policies the insurer shall maintain an active life reserve which shall place a sound value on its liabilities under such policies and which shall not be less than the reserve according to the standards set forth in regulations issued by the Commissioner and, in no event, less than the pro rata gross unearned premium reserve for such policies.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 282, &sect; 1508. &nbsp;</span></p> <p><span class="cls0">&sect;36-1509. Increase of inadequate reserves - Present value discounting - Annual actuarial opinions - Investment limitations - Unusual dividend or benefit payments.&nbsp;</span></p> <p><span class="cls0">A. If the Insurance Commissioner determines in writing that an insurer's unearned premium reserve, however computed, is inadequate, the Commissioner may require the insurer to compute the reserve or any part thereof according to any other method or methods as are prescribed in this article.&nbsp;</span></p> <p><span class="cls0">B. If the loss experience of an insurer shows that its loss reserves, however estimated, are inadequate, the Commissioner, in writing, shall require the insurer to maintain loss reserves in an increased amount as is needed to make them adequate.&nbsp;</span></p> <p><span class="cls0">C. 1. Insurers shall not use present value discounting for computing reserves for property and casualty insurance, except for workers' compensation carriers and physicians' and hospitals' professional liability insurance written on an occurrence basis. Workers' compensation carriers may use present value discounting at a rate of four percent (4%) for disability and death claims. Property and casualty insurers which elect to use present value discounting for computing reserves on physicians' and hospitals' professional liability insurance shall file initially, and thereafter annually, an actuarial opinion certifying to the adequacy of such reserves which shall include an analysis of the propriety of loss payout patterns, interest rate assumptions used in developing the discount and the adequacy of the insurer's rates. Additionally, the actuary shall consider the quality and liquidity of the insurer's assets and the nature and extent of the insurer's reinsurance program. In no event shall the interest rate used to compute the discounted reserves exceed the insurer's average yield on invested assets for the year, less one percent (1%).&nbsp;</span></p> <p><span class="cls0">2. Annual actuarial opinions required pursuant to this subsection shall be filed by the insurer on or before the first day of April. All actuarial opinions shall be from an independent actuary with membership in the American Academy of Actuaries or The Casualty Actuarial Society.&nbsp;</span></p> <p><span class="cls0">3. Except for workers' compensation insurance carriers, insurers discounting reserves pursuant to this subsection shall invest and maintain their funds only in cash; securities described in the following sections of this Code:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;Section 1607 (securities of or guaranteed by the United States),&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;Section 1608 (state and Canadian public obligations),&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;Section 1609 (county, municipal and district obligations),&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;Section 1610 (public improvement bonds),&nbsp;</span></p> <p class="cls2"><span class="cls0">e.&nbsp;&nbsp;Section 1611 (obligations payable from public utility revenues) limited to issues which, at time of purchase, are rated A or better by Standard and Poor's Bond Guide or Moody's Bond Record,&nbsp;</span></p> <p class="cls2"><span class="cls0">f.&nbsp;&nbsp;Section 1614 (corporate obligations) limited to issues which, at time of purchase, are rated A or better by Standard and Poor's Bond Guide or Moody's Bond Record, and&nbsp;</span></p> <p class="cls2"><span class="cls0">g.&nbsp;&nbsp;Section 1620 (deposits, banks, savings and loans);&nbsp;</span></p> <p><span class="cls0">and any other investment specifically approved by the Commissioner.&nbsp;</span></p> <p><span class="cls0">4. This subsection applies to reserves established in connection with incidents of loss occurring on or after January 1, 1989. The investment limitations prescribed by this subsection shall be applicable on or after January 1, 1989.&nbsp;</span></p> <p><span class="cls0">D. During any period of reserve strengthening mandated by the Commissioner pursuant to the provisions of this section, no insurer shall pay dividends or other benefits which would not be normal payments under the terms of a policy to any stockholder or policyholder of such insurer and such insurer shall be subject to any additional reasonable restrictions as the Commissioner shall deem prudent.&nbsp;</span></p> <p><span class="cls0">E. Insurers shall report, on a form prescribed by the Commissioner and filed with their annual statement, all funds collected through policy fees or assessments which were collected in response to a written request to increase inadequate reserves from the Commissioner made pursuant to the provisions of this section.&nbsp;</span></p> <p><span class="cls0">F. 1. Insurers domiciled in this state that are issuing policies of medical professional liability insurance to physicians, allied health care professionals and health care institutions, as defined by Section 2202 of this title, on July 1, 2004, are granted a moratorium on the applicability of any provisions of the laws of this state that require the maintenance of adequate reserves. The moratorium shall be in effect until December 31, 2008.&nbsp;</span></p> <p><span class="cls0">2. Any insurer eligible to utilize the moratorium provided by this section that elects to utilize the moratorium shall notify the Commissioner in writing of the election prior to the application of the moratorium to the insurer.&nbsp;</span></p> <p><span class="cls0">3. Any policy issued by an insurer utilizing the moratorium provided by this section shall, during the moratorium period, contain the following notice in ten-point type on the front page and the declaration page:&nbsp;</span></p> <p class="cls15"><span class="cls0">NOTICE&nbsp;</span></p> <p><span class="cls0">The insurer is not subject to the insurance laws and regulations related to maintenance of reserves and surplus.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 282, &sect; 1509, operative July 1, 1957. Amended by Laws 1988, c. 151, &sect; 1, eff. Nov. 1, 1988; Laws 1990, c. 227, &sect; 2, emerg. eff. May 18, 1990; Laws 1996, c. 363, &sect; 15, eff. Nov. 1, 1996; Laws 2004, c. 368, &sect; 56, eff. July 1, 2004; Laws 2005, c. 44, &sect; 1, eff. Nov. 1, 2005.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1509.1. Confidentiality of information.&nbsp;</span></p> <p><span class="cls0">All work papers, recorded information, documents and copies of materials associated with, produced, obtained by or disclosed to the Insurance Commissioner or any other person in the course of review or analysis pursuant to Sections 1801 through 1938 of this title shall be given confidential treatment by the Commissioner and may not be made public by the Commissioner or any other person who obtained the information in the course of the review or analysis, except to the extent provided in Sections 1801 through 1938 of this title, unless prior written consent of the company to which it pertains has been obtained. The confidentiality and protection from discovery by subpoena provided for in this paragraph shall not be construed to be extended to identical, similar or other related documents or information or to the work papers that are not deemed to be in the possession, custody or control of the Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 2010, c. 356, &sect; 6, eff. Nov. 1, 2010. Amended by Laws 2012, c. 149, &sect; 4, eff. Nov. 1, 2012.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;361510. Valuation law; life.&nbsp;</span></p> <p><span class="cls0">A. 1. The Insurance Commissioner shall annually make calculations of all outstanding policies, additions thereto, unpaid dividends, annuity and pure endowment contracts and all other obligations of every life insurance corporation doing business in this state. All valuations made by the Insurance Commissioner shall be made upon the net premium basis. In the case of alien insurers, such valuation shall be limited to its United States business. The legal minimum standard for valuation of contracts issued before the first day of January, 1910, shall be the Actuaries or Combined Experience Table of Mortality, with interest at four percent (4%) per annum, and for valuation of contracts issued on or after said date and before June 6, 1949, shall be the American Experience Table of Mortality, or the American Men Table of Mortality, with interest at three and onehalf percent (3 1/2%) per annum. Except as otherwise provided policies issued on or after the operative date of paragraph 4 of subsection G of Section 4029 of this title, policies issued on or after June 6, 1949, shall be valued, collectively as to all such policies or severally as to policies of any plan or form at the option of the company according to the American Experience Table of Mortality, the American Men Table of Mortality, the Commissioners 1941 Standard Ordinary Mortality Table or on and after July 1, 1962, the Commissioners 1958 Standard Ordinary Mortality Table for policies of ordinary insurance, and the Standard Industrial Mortality Table (1907), or the 1941 Standard Industrial Mortality Table or the Commissioners 1961 Standard Industrial Mortality Table for policies of industrial insurance, with interest at not more than three and onehalf percent (3 1/2%) per annum, or four percent (4%) per annum in the case of policies issued on or after April 11, 1974, and prior to March 17, 1978, and four and onehalf percent (4 1/2%) per annum for policies issued on or after March 17, 1978; provided, however, that policies issued to substandard risks or other special classes may be valued according to such other mortality tables, with interest at not more than three and onehalf percent (3 1/2%) per annum, or four percent (4%) per annum in the case of policies issued on or after April 11, 1974, and prior to March 17, 1978, and four and onehalf percent (4 1/2%) per annum for policies issued on or after March 17, 1978, as may be approved by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">2. For individual annuity and pure endowment contracts, excluding any disability and accidental death benefits in such policies, the 1937 Standard Annuity Mortality Table, or, at the option of the company, the Annuity Mortality Table for 1949, Ultimate, or any modification of either of these tables approved by the Commissioner.&nbsp;</span></p> <p><span class="cls0">3. For group annuity and pure endowment contracts, excluding any disability and accidental death benefits in such policies, the Group Annuity Mortality Table for 1951, any modification of such table approved by the Commissioner, or, at the option of the company, any of the tables or modifications of tables specified for individual annuity and pure endowment contracts.&nbsp;</span></p> <p><span class="cls0">4. The mortality table used in determining the minimum standard for the valuation of ordinary life insurance policies issued on or after the operative date of paragraph 4 of subsection G of Section 4029 of this title shall be (i) the Commissioners 1980 Standard Ordinary Mortality Table, or (ii) at the election of the company for any one or more specified plans of life insurance, the Commissioners 1980 Standard Ordinary Mortality Table with TenYear Select Mortality Factors, or (iii) any ordinary mortality table, adopted after 1980 by the National Association of Insurance Commissioners, that is approved by regulation promulgated by the Commissioner for use in determining the minimum standard of valuation for such policies.&nbsp;</span></p> <p><span class="cls0">5. Except as provided in subsection B of this section, the minimum standard for the valuation of all individual annuity and pure endowment contracts issued on or after the operative date of this section and for all annuities and pure endowments purchased on or after such operative date under group annuity and pure endowment contracts shall be the Commissioner's reserve valuation methods defined in subsections E and F of this section and the following tables and interest rates:&nbsp;</span></p> <p class="cls21"><span class="cls0">(a)&nbsp;&nbsp;For individual annuity and pure endowment contracts issued prior to August 29, 1977, excluding any disability and accidental death benefit in such contracts, the 1971 Individual Annuity Mortality Table, or any modification of this table approved by the Commissioner, and six percent (6%) interest for single premium immediate annuity contracts, and four percent (4%) interest for all other individual annuity and pure endowment contracts;&nbsp;</span></p> <p class="cls21"><span class="cls0">(b)&nbsp;&nbsp;For individual single premium immediate annuity contracts issued on or after August 29, 1977, excluding any disability and accidental death benefits in such contracts, the 1971 Individual Annuity Mortality Table or any individual annuity mortality table adopted after 1980 by the National Association of Insurance Commissioners that is approved by regulation promulgated by the Commissioner for use in determining the minimum standard of valuation for such contracts, or any modification of these tables approved by the Commissioner, and seven and onehalf percent (7 1/2%) interest;&nbsp;</span></p> <p class="cls21"><span class="cls0">(c)&nbsp;&nbsp;For individual annuity and pure endowment contracts issued on or after August 29, 1977, other than single premium immediate annuity contracts, excluding any disability and accidental death benefits in such contracts, the 1971 Individual Annuity Mortality Table or any individual annuity mortality table adopted after 1980 by the National Association of Insurance Commissioners that is approved by regulation promulgated by the Commissioner for use in determining the minimum standard of valuation for such contracts, or any modification of these tables approved by the Commissioner, and five and onehalf percent (5 1/2%) interest for single premium deferred annuity and pure endowment contracts and four and onehalf percent (4 1/2%) interest for all other such individual annuity and pure endowment contracts;&nbsp;</span></p> <p class="cls21"><span class="cls0">(d)&nbsp;&nbsp;For all annuities and pure endowments purchased prior to August 29, 1977, under group annuity and pure endowment contracts, excluding any disability and accidental death benefits purchased under such contracts, the 1971 Group Annuity Mortality Table, or any modification of this table approved by the Commissioner, and six percent (6%) interest;&nbsp;</span></p> <p class="cls21"><span class="cls0">(e)&nbsp;&nbsp;For all annuities and pure endowments purchased on or after August 29, 1977, under group annuity and pure endowment contracts, excluding any disability and accidental death benefits purchased under such contracts, the 1971 Group Annuity Mortality Table or any group annuity mortality table adopted after 1980 by the National Association of Insurance Commissioners that is approved by regulation promulgated by the Commissioner for use in determining the minimum standard of valuation for such annuities and pure endowments, or any modification of these tables approved by the Commissioner, and seven and onehalf percent (7 1/2%) interest.&nbsp;</span></p> <p><span class="cls0">After June 14, 1973, any company may file with the Commissioner a written notice of its election to comply with the provisions of this section after a specified date before January 1, 1985, which shall be the operative date of this section for such company, provided, a company may elect a different operative date for individual annuity and pure endowment contracts from that elected for group annuity and pure endowment contracts. If a company makes no such election, the operative date of this section for such company shall be January 1, 1985.&nbsp;</span></p> <p><span class="cls0">B. 1. The interest rates used in determining the minimum standard for the valuation of all life insurance policies issued in a particular calendar year on or after the operative date of paragraph 4 of subsection G of Section 4029 of this title shall be the calendar year statutory valuation interest rates as defined in this section.&nbsp;</span></p> <p><span class="cls0">2. The interest rates used in determining the minimum standard valuation of all individual annuity and pure endowment contracts issued in a particular calendar year on or after January 1, 1985, and all annuities and pure endowments purchased in a particular calendar year on or after January 1, 1985, under group annuity and pure endowment contracts shall be the calendar year statutory valuation interest rates as defined in this section.&nbsp;</span></p> <p><span class="cls0">C. 1. The calendar year statutory valuation interest rates, I, shall be determined as follows and the results rounded to the nearest onefourth of one percent (1/4 of 1%):&nbsp;</span></p> <p><span class="cls0">&nbsp;&nbsp;(a) For life insurance,&nbsp;</span></p> <p><span class="cls0">&nbsp;&nbsp;I = .03 + W (Ra .03) + (W/2) (Rb .09)&nbsp;</span></p> <p><span class="cls0">&nbsp;&nbsp;where Ra is the lesser of R and .09,&nbsp;</span></p> <p><span class="cls0">Rb is the greater of R and .09,&nbsp;</span></p> <p><span class="cls0">R is the reference interest rate defined&nbsp;</span></p> <p><span class="cls0">in this section, and W is the weighting&nbsp;</span></p> <p><span class="cls0">factor defined in this section.&nbsp;</span></p> <p class="cls21"><span class="cls0">(b)&nbsp;&nbsp;For single premium immediate annuities and for annuity benefits involving life contingencies arising from other annuities with cash settlement options and from guaranteed interest contracts with cash settlement options,&nbsp;</span></p> <p class="cls21"><span class="cls0">I = .03 + W(r .03)&nbsp;</span></p> <p class="cls21"><span class="cls0">where R 1 is the lesser of R and .09,&nbsp;</span></p> <p class="cls21"><span class="cls0">R 2 is the greater of R and .09,&nbsp;</span></p> <p class="cls21"><span class="cls0">R is the reference interest rate defined in this section,&nbsp;</span></p> <p class="cls21"><span class="cls0">and W is the weighting factor defined in this section.&nbsp;</span></p> <p class="cls21"><span class="cls0">(c)&nbsp;&nbsp;For other annuities with cash settlement options and&nbsp;</span></p> <p class="cls21"><span class="cls0"> &nbsp;&nbsp;guaranteed interest contracts with cash settlement options, valued on an issue year basis, except as stated in subparagraph (b) of this paragraph, the formula for life insurance stated in subparagraph (a) of this paragraph shall apply to annuities and guaranteed interest contracts with guarantee durations in excess of ten (10) years and the formula for single premium immediate annuities stated in subparagraph (b) of this paragraph shall apply to annuities and guaranteed interest contracts with guarantee duration of ten (10) years or less.&nbsp;</span></p> <p class="cls21"><span class="cls0">(d)&nbsp;&nbsp;For other annuities with no cash settlement options and for guaranteed interest contracts with no cash settlement options, the formula for single premium immediate annuities stated in subparagraph (b) of this paragraph shall apply.&nbsp;</span></p> <p class="cls21"><span class="cls0">(e)&nbsp;&nbsp;For other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, valued on a change in fund basis, the formula for single premium immediate annuities stated in subparagraph (b) of this paragraph shall apply.&nbsp;</span></p> <p><span class="cls0">2. However, if the calendar year statutory valuation interest rate for any life insurance policies issued in any calendar year determined without reference to this sentence differs from the corresponding actual rate for similar policies issued in the immediately preceding calendar year by less than onehalf of one percent (1/2 of 1%), the calendar year statutory valuation interest rate for such life insurance policies shall be equal to the corresponding actual rate for the immediately preceding calendar year. For purposes of applying the immediately preceding sentence, the calendar year statutory valuation interest rate for life insurance policies issued in a calendar year shall be determined for 1980, using the reference interest rate defined for 1979, and shall be determined for each subsequent calendar year.&nbsp;</span></p> <p><span class="cls0">D. 1. The weighting factors referred to in the formulas stated above are given in the following table:&nbsp;</span></p> <p><span class="cls0">&nbsp;&nbsp;(a) Weighting Factors for Life Insurance:&nbsp;</span></p> <p><span class="cls0">Guarantee&nbsp;</span></p> <p class="cls14"><span class="cls0">Duration&nbsp;&nbsp;&nbsp;&nbsp;Weighting&nbsp;</span></p> <p class="cls14"><span class="cls0">(Years)&nbsp;&nbsp;&nbsp;&nbsp; Factors&nbsp;</span></p> <p class="cls14"><span class="cls0">10 or less&nbsp;&nbsp;&nbsp;&nbsp; .50&nbsp;</span></p> <p><span class="cls0">More than 10, but not more than&nbsp;</span></p> <p class="cls14"><span class="cls0">20&nbsp;&nbsp;&nbsp;&nbsp; .45&nbsp;</span></p> <p class="cls14"><span class="cls0">More than 20&nbsp;&nbsp;&nbsp;&nbsp; .35&nbsp;</span></p> <p class="cls21"><span class="cls0">For life insurance, the guarantee duration is the maximum number of years the life insurance can remain in force on a basis guaranteed in the policy or under options to convert to plans of life insurance with premium rates or nonforfeiture values or both which are guaranteed in the original policy.&nbsp;</span></p> <p class="cls21"><span class="cls0">(b)&nbsp;&nbsp;Weighting factor for single premium immediate annuities and for annuity benefits involving life contingencies arising from other annuities with cash settlement options and guaranteed interest contracts with cash settlement options:&nbsp;</span></p> <p class="cls21"><span class="cls0">(c)&nbsp;&nbsp;Weighting factors for other annuities and for guaranteed interest contracts, except as stated in subparagraph (b) of this paragraph, shall be as specified in tables (1), (2) and (3) below, according to the rules and definitions in (4) and (5) below:&nbsp;</span></p> <p class="cls21"><span class="cls0">(1)&nbsp;&nbsp;For annuities and guaranteed interest contracts valued on an issue year basis:&nbsp;</span></p> <p><span class="cls0">Guarantee&nbsp;&nbsp;Weighting Factor&nbsp;</span></p> <p><span class="cls0">Duration&nbsp;&nbsp; for Plan Type&nbsp;</span></p> <p><span class="cls0">(Years)&nbsp;&nbsp; A&nbsp;&nbsp; B&nbsp;&nbsp; C&nbsp;</span></p> <p><span class="cls0">5 or less&nbsp;&nbsp; .80&nbsp;&nbsp;.60&nbsp;&nbsp; .50&nbsp;</span></p> <p><span class="cls0">More than 5, but not more than 10&nbsp;&nbsp; .75&nbsp;&nbsp;.60&nbsp;&nbsp; .50&nbsp;</span></p> <p><span class="cls0">More than 10, but not more than 20&nbsp;&nbsp; .65&nbsp;&nbsp;.50&nbsp;&nbsp; .45&nbsp;</span></p> <p><span class="cls0">More than 20&nbsp;&nbsp; .45&nbsp;&nbsp;.35&nbsp;&nbsp; .35&nbsp;</span></p> <p><span class="cls0">Plan Type&nbsp;</span></p> <p><span class="cls0"> A&nbsp;&nbsp; B&nbsp;&nbsp; C&nbsp;</span></p> <p><span class="cls0">(2) For annuities and guaranteed&nbsp;</span></p> <p><span class="cls0">interest contracts valued on&nbsp;</span></p> <p><span class="cls0">a change in fund basis, the&nbsp;</span></p> <p><span class="cls0">factors shown in (1) above&nbsp;</span></p> <p><span class="cls0">increased by:&nbsp;&nbsp; .15&nbsp;&nbsp;.25&nbsp;&nbsp; .05&nbsp;</span></p> <p><span class="cls0">Plan Type&nbsp;</span></p> <p><span class="cls0"> A&nbsp;&nbsp; B&nbsp;&nbsp; C&nbsp;</span></p> <p><span class="cls0">(3) For annuities and guaranteed&nbsp;</span></p> <p><span class="cls0">interest contracts valued on&nbsp;</span></p> <p><span class="cls0">an issue year basis (other than&nbsp;</span></p> <p><span class="cls0">those with no cash settlement&nbsp;</span></p> <p><span class="cls0">options) which do not guarantee&nbsp;</span></p> <p><span class="cls0">interest on considerations received&nbsp;</span></p> <p><span class="cls0">more than one (1) year after issue or&nbsp;</span></p> <p><span class="cls0">purchase and for annuities and&nbsp;</span></p> <p><span class="cls0">guaranteed interest contracts valued&nbsp;</span></p> <p><span class="cls0">on a change in fund basis which do&nbsp;</span></p> <p><span class="cls0">not guarantee interest rates on&nbsp;</span></p> <p><span class="cls0">considerations received more than&nbsp;</span></p> <p><span class="cls0">twelve (12) months beyond the valuation date,&nbsp;</span></p> <p><span class="cls0">the factors shown in (1) or derived&nbsp;</span></p> <p><span class="cls0">in (2) increased by:&nbsp;&nbsp; .05&nbsp;&nbsp;.05&nbsp;&nbsp; .05&nbsp;</span></p> <p><span class="cls0">(4)&nbsp;&nbsp;For other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, the guarantee duration is the number of years for which the contract guarantees interest rates in excess of the calendar year statutory valuation interest rate for life insurance policies with guarantee duration in excess of twenty (20) years. For other annuities with no cash settlement options and for guaranteed interest contracts with no cash settlement options, the guarantee duration is the number of years from the date of issue or date of purchase to the date annuity benefits are scheduled to commence.&nbsp;</span></p> <p><span class="cls0">(5)&nbsp;&nbsp;Plan type as used in the above tables is defined as follows:&nbsp;</span></p> <p><span class="cls0">Plan Type A: At any time policyholder may withdraw funds only (1) with an adjustment to reflect changes in interest rates or asset values since receipt of the funds by the insurance company, or (2) without such adjustment but in installments over five (5) years or more, or (3) as an immediate life annuity, or (4) no withdrawal permitted.&nbsp;</span></p> <p><span class="cls0">Plan Type B: Before expiration of the interest rate guarantee, policyholder may withdraw funds only (1) with adjustment to reflect changes in interest rates or asset values since receipt of the funds by the insurance company, or (2) without such adjustment but in installments over five (5) years or more, or (3) no withdrawal permitted. At the end of interest rate guarantee, funds may be withdrawn without such adjustment in a single sum or installments over less than five (5) years.&nbsp;</span></p> <p><span class="cls0">Plan Type C: Policyholder may withdraw funds before expiration of interest rate guarantee in a single sum or installments over less than five (5) years either (1) without adjustment to reflect changes in interest rates or asset values since receipt of the funds by the insurance company, or (2) subject only to a fixed surrender charge stipulated in the contract as a percentage of the fund.&nbsp;</span></p> <p><span class="cls0">2. A company may elect to value guaranteed interest contracts with cash settlement options and annuities with cash settlement options on either an issue year basis or on a change in fund basis. Guaranteed interest contracts with no cash settlement options and other annuities with no cash settlement options shall be valued on an issue year basis. As used in this section, an issue year basis of valuation refers to a valuation basis under which the interest rate used to determine the minimum valuation standard for the entire duration of the annuity or guaranteed interest contract is the calendar year valuation interest rate for the year of issue or year of purchase of the annuity or guaranteed interest contract, and the change in fund basis of valuation refers to a valuation basis under which the interest rate used to determine the minimum valuation standard applicable to each change in the fund held under the annuity or guaranteed interest contract is the calendar year valuation interest rate for the year of the change in the fund.&nbsp;</span></p> <p><span class="cls0">E. 1. The reference interest rate referred to above shall be defined as follows:&nbsp;</span></p> <p class="cls21"><span class="cls0">(a) For all life insurance, the lesser of the average over a period of thirtysix (36) months and the average over a period of twelve (12) months, ending on June 30 of the calendar year next preceding the year of issue, of Moody's Corporate Bond Yield Average Monthly Average Corporates, as published by Moody's Investors Service, Inc.&nbsp;</span></p> <p class="cls21"><span class="cls0">(b) For single premium immediate annuities and for annuity benefits involving life contingencies arising from other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, the average over a period of twelve (12) months, ending on June 30 of the calendar year of issue or year of purchase of the Monthly Average of the Composite Yield on Seasoned Corporate Bonds, as published by Moody's Investors Service, Inc.&nbsp;</span></p> <p class="cls21"><span class="cls0">(c) For other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, valued on an issue year basis, except as stated in subparagraph (b) of this paragraph, with guarantee duration in excess of ten (10) years, the lesser of the average over a period of thirtysix (36) months and the average over a period of twelve (12) months, ending on June 30 of the calendar year of issue or purchase, of the Monthly Average of the Composite Yield on Seasoned Corporate Bonds, as published by Moody's Investors Service, Inc.&nbsp;</span></p> <p class="cls21"><span class="cls0">(d) For other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, valued on an issue year basis, except as stated in subparagraph (b) of this paragraph, with guarantee duration of ten (10) years or less, the average over a period of twelve (12) months, ending on June 30 of the calendar year of issue or purchase, of the Monthly Average of the Composite Yield on Seasoned Corporate Bonds, as published by Moody's Investors Service, Inc.&nbsp;</span></p> <p class="cls21"><span class="cls0">(e) For other annuities with no cash settlement options and for guaranteed interest contracts with no cash settlement options, the average over a period of twelve (12) months, ending on June 30 of the calendar year of issue or purchase, of the Monthly Average of the Composite Yield on Seasoned Corporate Bonds, as published by Moody's Investors Service, Inc.&nbsp;</span></p> <p class="cls21"><span class="cls0">(f) For other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, valued on a change in fund basis, except as stated in subparagraph (b) of this paragraph, the average over a period of twelve (12) months, ending on June 30 of the calendar year of the change in the fund, of the Monthly Average of the Composite Yield on Seasoned Corporate Bonds, as published by Moody's Investors Service, Inc.&nbsp;</span></p> <p><span class="cls0">F. In the event that the Moody's Corporate Bond Yield Average Monthly Average Corporates is no longer published by Moody's Investors Service, Inc., or in the event that the National Association of Insurance Commissioners determines that the Moody's Corporate Bond Yield Average Monthly Average Corporates as published by Moody's Investors Service, Inc., is no longer appropriate for the determination of the reference interest rate, then an alternative method for determination of the reference interest rate, which is adopted by the National Association of Insurance Commissioners and approved by regulation promulgated by the Commissioner, may be substituted.&nbsp;</span></p> <p><span class="cls0">G. The Commissioner may vary the standards of interest and mortality in particular cases of invalid life and other extra hazards and value policies in groups, use approximate averages for fractions of a year and otherwise, and accept the valuation of the Department of Insurance of any other state or country, if made upon a basis and according to standards not lower than herein required or authorized, in place of the valuation herein required.&nbsp;</span></p> <p><span class="cls0">H. If in any contract year the gross premium charged by any life insurance company on any policy or contract is less than the valuation net premium for the policy or contract calculated by the method used in computing the reserve liability thereon but using the minimum valuation standards of mortality and rate of interest, the minimum reserve required for such policy or contract shall be the greater of either the reserve calculated according to the mortality table, rate of interest and method actually used for such policy or contract, or the reserve calculated by the method actually used for such policy or contract, but using the minimum valuation standards of mortality and rate of interest and replacing the valuation net premium by the actual gross premium in each contract year for which the valuation net premium exceeds the actual gross premium. The minimum valuation standards of mortality and rate of interest referred to in this subsection are those standards stated in this section.&nbsp;</span></p> <p><span class="cls0">Provided that for any life insurance policy issued on or after January 1, 1986, for which the gross premium in the first policy year exceeds that of the second year and for which no comparable additional benefit is provided in the first year for such excess, and which provides an endowment benefit or a cash surrender value or a combination thereof in an amount greater than such excess premium, the foregoing provisions of this subsection shall be applied as if the method actually used in calculating the reserve for such policy were the method described in paragraph 2 of subsection J of this section, ignoring subparagraph (c) of that paragraph. The minimum reserve at each policy anniversary of such a policy shall be the greater of the minimum reserve calculated in accordance with paragraph 2 of subsection J of this section, including subparagraph (c) of that paragraph, and the minimum reserve calculated in accordance with this subsection.&nbsp;</span></p> <p><span class="cls0">I. Term Insurance.&nbsp;</span></p> <p><span class="cls0">Policies issued by life insurance companies doing business in this state may provide for not more than one (1) year preliminary term insurance, purchased by the whole or part of the premium to be received during the first policy year, under the conditions prescribed in this section.&nbsp;</span></p> <p><span class="cls0">J. Reserves.&nbsp;</span></p> <p><span class="cls0">1. Reserves on policies of ordinary insurance which are valued in accordance with the American Experience Table of Mortality, or the American Men Table of Mortality, and policies of industrial insurance which are valued in accordance with the Standard Industrial Mortality Table (1907), which are issued on or after June 6, 1949, may be computed as follows: If the premium charged for term insurance under a limited payment life preliminary term policy providing for the payment of all premiums thereon in less than twenty (20) years from the date of the policy or under an endowment preliminary term policy, exceeds that charged for life insurance, under twentyyear payment life preliminary term policies of the same company, the reserve thereon at the end of any year, including the first, shall not be less than the reserve on a twentypayment life preliminary term policy issued in the same year and at the same age, together with an amount which shall be equivalent to the accumulation of a net level premium sufficient to provide for a pure endowment at the end of the premium payment period equal to the difference between the value at the end of such period of such a twentypayment life preliminary term policy and the full reserve at such time of such a limited payment life or endowment policy. The premium payment period is the period during which premiums are concurrently payable under such twentypayment life preliminary term policy and such limited payment life or endowment policy. Any policy valued in accordance with this paragraph shall specify the mortality table, rate of interest, and method used in calculating the reserves on the policy.&nbsp;</span></p> <p><span class="cls0">2. Reserves on policies of ordinary insurance which are valued in accordance with the Commissioners 1941 Standard Ordinary Mortality Table, the Commissioners 1958 Standard Ordinary Mortality Table, or the Commissioners 1980 Standard Ordinary Mortality Table, policies of industrial insurance which are valued in accordance with the 1941 Standard Industrial Mortality Table or the Commissioners 1961 Standard Industrial Mortality Table and policies valued in accordance with any substandard mortality table approved by the Commissioner pursuant to this section, issued on or after June 6, 1949, may be computed in accordance with the Commissioners Reserve Valuation method, defined as follows: Reserves for the life insurance and endowment benefits of policies providing for a uniform amount of insurance and requiring the payment of uniform premiums shall be the excess, if any, of the present value, at the date of valuation, of such future guaranteed benefits provided for by such policies, over the then present value of any future modified net premiums therefor. The modified net premiums for any such policy shall be such uniform percentage of the respective contract premiums for such benefits that the present value, at the date of issue of the policy, of all such modified net premiums shall be equal to the sum of the then present value of such benefits provided for by the policy and the excess of subparagraph (a) over subparagraph (b) as follows:&nbsp;</span></p> <p class="cls21"><span class="cls0">(a) a net level annual premium equal to the present value, at the date of issue, of such benefits provided for after the first policy year, divided by the present value, at the date of issue, of an annuity of one per annum payable on the first and each subsequent anniversary of such policy on which a premium falls due; provided, however, that such level annual premium shall not exceed the net level annual premium on the nineteenyear premium whole life plan for insurance of the same amount at the age one (1) year higher than the age at issue of such policy,&nbsp;</span></p> <p class="cls21"><span class="cls0">(b) a net oneyear term premium for such benefits provided for in the first policy year, and&nbsp;</span></p> <p class="cls21"><span class="cls0">(c) provided that for any life insurance policy issued on or after January 1, 1986, for which the contract premium in the first policy year exceeds that of the second year and for which no comparable additional benefit is provided in the first year for such excess and which provides an endowment benefit or a cash surrender value or a combination thereof in an amount greater than such excess premium, the reserve according to the commissioners reserve valuation method as of any policy anniversary occurring on or before the assumed ending date defined herein as the first policy anniversary on which the sum of any endowment benefit and any cash surrender value then available is greater than such excess premium shall, except as otherwise provided in subsection H of this section, be the greater of the reserve as of such policy anniversary calculated as described in this paragraph and the reserve as of such policy anniversary calculated as described in subparagraph (a) of this paragraph, but with (i) the value defined in subparagraph (a) of that paragraph being reduced by fifteen percent (15%) of the amount of such excess firstyear premium, (ii) all present values of benefits and premiums being determined without reference to premiums or benefits provided for by the policy after the assumed ending date, (iii) the policy being assumed to mature on such date as an endowment, and (iv) the cash surrender value provided on such date being considered as an endowment benefit. In making the above comparison, the mortality and interest bases stated in this section shall be used.&nbsp;</span></p> <p><span class="cls0">Reserves for life insurance policies providing for a varying amount of insurance or requiring the payment of varying premiums shall be calculated by a method consistent with the principles of paragraph 2 of this subsection, provided that any extra premiums charged because of impairments or special hazards shall be disregarded in the determination of modified net premiums. All modified net premiums and present values referred to in this section, except those based on sexdistinct mortality tables, may be calculated according to an age not more than six (6) years younger than the actual age of the insured in the case of any category of ordinary policies issued on female risks.&nbsp;</span></p> <p><span class="cls0">K. 1. Reserves on policies of any category may be computed, at the option of the company, according to any valuation standard which produces greater aggregate reserves than those computed according to the minimum standard provided in this section.&nbsp;</span></p> <p><span class="cls0">2. In the case of any plan of life insurance which provides for future premium determination, the amounts of which are to be determined by the insurance company based on then estimates of future experience, or in the case of any plan of life insurance or annuity which is of such a nature that the minimum reserves cannot be determined by the methods described in subsections A, G, H, I, and L of this section, the reserves which are held under any such plan must:&nbsp;</span></p> <p class="cls21"><span class="cls0">(a) be appropriate in relation to the benefits and the&nbsp;&nbsp;pattern of premiums for that plan, and&nbsp;</span></p> <p class="cls21"><span class="cls0">(b) be computed by a method which is consistent with the principles of this Standard Valuation Law,&nbsp;</span></p> <p><span class="cls0">as determined by regulations promulgated by the Commissioner.&nbsp;</span></p> <p><span class="cls0">L. This section shall apply to all annuity and pure endowment contracts other than group annuity and pure endowment contracts purchased under a retirement plan or plan of deferred compensation, established or maintained by an employer (including a partnership or sole proprietorship) or by an employee organization, or by both, other than a plan providing individual retirement accounts or individual retirement annuities under Section 408 of the Internal Revenue Code, as now or hereafter amended.&nbsp;</span></p> <p><span class="cls0">Reserves according to the Commissioners Annuity Reserve method for benefits under annuity or pure endowment contracts, excluding any disability and accidental death benefits in such contracts, shall be the greatest of the respective excesses of the present values, at the date of valuation, of the future guaranteed benefits, including guaranteed nonforfeiture benefits, provided for by such contracts at the end of each respective contract year, over the present value, at the date of valuation, of any future valuation considerations derived from future gross considerations, required by the terms of such contract, that become payable prior to the end of such respective contract year. The future guaranteed benefits shall be determined by using the mortality table, if any, and the interest rate, or rates, specified in such contracts for determining guaranteed benefits. The valuation considerations are the portions of the respective gross considerations applied under the terms of such contracts to determine nonforfeiture values.&nbsp;</span></p> <p><span class="cls0">M. When the actual funds of any life insurance company doing business in this state, exclusive of its capital, are not of a net cash value equal to its liabilities including the net value of its policies according to the basis and minimum standards prescribed or authorized by the laws of this state, it shall be the duty of the Insurance Commissioner to give notice to such company and its agents to discontinue issuing new policies within this state, until such time as its funds have become equal to its liabilities as aforesaid. Any officer or agent who, after such notice has been given, issues or delivers a new policy from and on behalf of such company before its funds have become equal to its liabilities, as aforesaid, shall forfeit to the state for each offense a sum not less than One Hundred Dollars ($100.00) nor more than Five Thousand Dollars ($5,000.00) for each occurrence.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Amended by Laws 1982, c. 118, &sect; 1, emerg. eff. April 6, 1982; Laws 1984, c. 149, &sect; 5, eff. Nov. 1, 1984. &nbsp;</span></p> <p><span class="cls0">&sect;361511. Valuation of bonds.&nbsp;</span></p> <p><span class="cls0">A. All bonds or other evidences of debt having a fixed term and rate of interest held by any insurer may, if amply secured and not in default as to principal or interest, be valued as follows:&nbsp;</span></p> <p><span class="cls0">1. If purchased at par, at the par value.&nbsp;</span></p> <p><span class="cls0">2. If purchased above or below par, on the basis of the purchase price adjusted so as to bring the value to par at maturity and so as to yield in the meantime the effective rate of interest at which the purchase was made, or in lieu of such method, according to such accepted method of valuation as is approved by the Insurance Commissioner.&nbsp;</span></p> <p><span class="cls0">3. Purchase price shall in no case be taken at a higher figure than the actual market value at the time of purchase, plus actual brokerage, transfer, postage or express charges paid in the acquisition of such securities.&nbsp;</span></p> <p><span class="cls0">4. Unless otherwise provided by valuation established or approved by the National Association of Insurance Commissioners, no such security shall be carried at above the call price for the entire issue during any period within which the security may be so called.&nbsp;</span></p> <p><span class="cls0">B. The Insurance Commissioner shall have full discretion in determining the method of calculating values according to the rules set forth in this section and not inconsistent with any such methods then currently formulated or approved by the National Association of Insurance Commissioners.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 285, &sect; 1511. &nbsp;</span></p> <p><span class="cls0">&sect;361512. Valuation of other securities.&nbsp;</span></p> <p><span class="cls0">A. Securities, other than those referred to in Section 1511 of this article, held by an insurer shall be valued, in the discretion of the Insurance Commissioner, at their market value, or at true book value, all consistent with any current method for the valuation of any such security formulated or approved by the National Association of insurance Commissioners.&nbsp;</span></p> <p><span class="cls0">B. Preferred or guaranteed stocks or shares while paying full dividends may be carried at a fixed value in lieu of market value, at the discretion of the Insurance Commissioner and in accordance with such method of computation as he may approve.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 285, &sect; 1512; Laws 1967, c. 242, &sect; 1, emerg. eff. May 5, 1967. &nbsp;</span></p> <p><span class="cls0">&sect;361513. Valuation of real property Improvements.&nbsp;</span></p> <p><span class="cls0">A. Real property acquired pursuant to a mortgage loan or contract for sale shall not be valued at an amount greater than the unpaid principal of the defaulted loan or contract at the date of such acquisition, together with any taxes and expenses paid or incurred in connection with such acquisition. In addition, the company may make improvements to such property, provided however, the cost of such improvements plus the acquisition costs and unpaid principal of the defaulted loan or contract shall not exceed the lesser of four percent (4%) of the admitted assets or surplus of the company in regard to policyholders.&nbsp;</span></p> <p><span class="cls0">B. Other real property held by an insurer shall be valued at an amount not to exceed the lower of current market value or cost plus capitalized improvements less normal depreciation. In lieu of writing down investment real estate or taking part of the value as nonadmitted when market value is less than book value, an insurer may establish a reserve for specific properties as a liability. If valuation is based on an appraisal more than three (3) years old, the Insurance Commissioner may at his discretion call for and require a new appraisal in order to determine fair value.&nbsp;</span></p> <p><span class="cls0">Real property held by an insurer prior to September 1, 1993, shall be in compliance with the limitations of this section by December 31, 1997. Insurers shall maintain accurate and adequate records reflecting the provisions of this section and submit such records with quarterly and annual statements.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1957, p. 285, &sect; 1513. Amended by Laws 1989, c. 181, &sect; 3, eff. Nov. 1, 1989; Laws 1993, c. 79, &sect; 5, eff. Sept. 1, 1993.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361514. Valuation of purchase money mortgages.&nbsp;</span></p> <p><span class="cls0">Purchase money mortgages on real property referred to in subsection A of Section 1513 of this article shall be valued in an amount not exceeding the acquisition cost of the real property covered thereby or ninety percent (90%) of the fair value of such real property, whichever is less.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 285, &sect; 1514. &nbsp;</span></p> <p><span class="cls0">&sect;361515. Information for valuation of securities.&nbsp;</span></p> <p><span class="cls0">It shall be the duty of every domestic insurance company holding securities valued under Sections 1511 or 1512 which do not have an established market value to furnish the Commissioner of Insurance, within thirty (30) days of his request, sufficient financial information concerning the issuing corporation, so as to enable him to arrive at a proper value of the security so held. Failure to furnish such information as specified herein shall result in the security being ineligible as a deduction from liabilities.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1967, c. 242, &sect; 6, emerg. eff. May 5, 1967. &nbsp;</span></p> <p><span class="cls0">&sect;36-1521. Short title.&nbsp;</span></p> <p><span class="cls0">This act shall be known and may be cited as the "Risk-based Capital for Insurers Act".&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 2, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1522. Definitions.&nbsp;</span></p> <p><span class="cls0">As used in this act:&nbsp;</span></p> <p><span class="cls0">1. "Adjusted RBC Report" means an RBC report which has been adjusted by the Insurance Commissioner in accordance with subsection D of Section 1523 of this title;&nbsp;</span></p> <p><span class="cls0">2. "Corrective order" means an order issued by the Commissioner specifying corrective actions which the Commissioner has determined are required;&nbsp;</span></p> <p><span class="cls0">3. "Domestic insurer" means any insurance company domiciled in this state;&nbsp;</span></p> <p><span class="cls0">4. "Foreign insurer" means any insurance company which has a certificate of authority to do business in this state but is not domiciled in this state;&nbsp;</span></p> <p><span class="cls0">5. "Life or health insurer" means any insurance company with a certificate of authority to write life or health insurance, or a licensed property and casualty insurer writing only accident and health insurance;&nbsp;</span></p> <p><span class="cls0">6. "Negative trend" means, with respect to a life or health insurer or a fraternal benefit society, negative trend over a period of time, as determined in accordance with the "Trend Test Calculation" included in the Life or Fraternal RBC Instructions;&nbsp;</span></p> <p><span class="cls0">7. "NAIC" means the National Association of Insurance Commissioners;&nbsp;</span></p> <p><span class="cls0">8. "Property and casualty insurer" means any insurance company with a certificate of authority to write property or casualty insurance, and shall not include monoline mortgage guaranty insurers, financial guaranty insurers, or title insurers;&nbsp;</span></p> <p><span class="cls0">9. "RBC" means risk-based capital;&nbsp;</span></p> <p><span class="cls0">10. "RBC Instructions" means the RBC Report including risk-based capital instructions adopted by the NAIC, as adopted by the Commissioner by rule, and any amendments thereto adopted by the Commissioner by rule;&nbsp;</span></p> <p><span class="cls0">11. "RBC Level" means an insurer's Company Action Level RBC, Regulatory Action Level RBC, Authorized Control Level RBC, or Mandatory Control Level RBC, where:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;"Company Action Level RBC" means, with respect to any insurer, the product of 2.0 and its Authorized Control Level RBC,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;"Regulatory Action Level RBC" means the product of 1.5 and its Authorized Control Level RBC,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;"Authorized Control Level RBC" means the number determined under the risk-based capital formula in accordance with RBC Instructions, and&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;"Mandatory Control Level RBC" means the product of 0.70 and the Authorized Control Level RBC;&nbsp;</span></p> <p><span class="cls0">12. "RBC Plan" means a comprehensive financial plan containing the elements specified in subsection B of Section 1524 of this title;&nbsp;</span></p> <p><span class="cls0">13. "Revised RBC Plan" means an RBC Plan which is rejected by the Commissioner and which is revised by the insurer with or without the Commissioner's recommendations;&nbsp;</span></p> <p><span class="cls0">14. "RBC Report" means the report required in Section 1523 of this title; and&nbsp;</span></p> <p><span class="cls0">15. "Total adjusted capital" means the sum of:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;an insurer's statutory capital and surplus as determined in accordance with the statutory accounting applicable to the annual financial statements required to be filed with the Commissioner, and&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;such other items, if any, as the RBC Instructions, as adopted by rule by the Commissioner, may provide.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 3, eff. July 1, 1997. Amended by Laws 2013, c. 269, &sect; 4, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1523. Annual risk-based capital report - Factors - Adjustment of inaccurate reports.&nbsp;</span></p> <p><span class="cls0">A. Every domestic insurer shall, on or prior to each March 1, which shall be known as the filing date, prepare and submit to the Insurance Commissioner a report of its RBC Levels as of the end of the calendar year just ended, in a form and containing such information as is required by the RBC Instructions, as adopted by the Commissioner by rule. In addition, every domestic insurer shall file its RBC Report with the NAIC if required by the Commissioner.&nbsp;</span></p> <p><span class="cls0">B. 1. A life and health insurer's or fraternal benefit society's RBC shall be determined in accordance with the formula set forth in the RBC Instructions, as adopted by the Commissioner by rule. The formula shall take into account, and may adjust for the covariance between, the following factors:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the risk with respect to the insurer's assets,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the risk of adverse insurance experience with respect to the insurer's liabilities and obligations,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;the interest rate risk with respect to the insurer's business, and&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;all other business risks and such other relevant risks as are set forth in the RBC Instructions.&nbsp;</span></p> <p><span class="cls0">2. These factors shall be determined in each case by applying the factors in the manner set forth in the RBC Instructions.&nbsp;</span></p> <p><span class="cls0">C. 1. A property and casualty insurer's RBC shall be determined in accordance with the formula set forth in the RBC Instructions, as adopted by the Commissioner by rule. The formula shall take into account, and may adjust for the covariance between, the following factors:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;asset risk,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;credit risk,&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;underwriting risk, and&nbsp;</span></p> <p class="cls2"><span class="cls0">d.&nbsp;&nbsp;all other business risks and such other relevant risks as are set forth in the RBC Instructions.&nbsp;</span></p> <p><span class="cls0">2. These factors shall be determined in each case by applying the factors in the manner set forth in the RBC Instructions.&nbsp;</span></p> <p><span class="cls0">D. If a domestic insurer files an RBC Report which in the judgment of the Commissioner is inaccurate, then the Commissioner, after notice and opportunity for comment, shall adjust the RBC Report to correct the inaccuracy and shall notify the insurer of the adjustment. The notice shall contain a statement of the reason for the adjustment. An RBC Report so adjusted shall be referred to as an "Adjusted RBC Report".&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 5, eff. July 1, 1997. Amended by Laws 2013, c. 269, &sect; 5, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1524. Company Action Level Event.&nbsp;</span></p> <p><span class="cls0">A. "Company Action Level Event" means any of the following events:&nbsp;</span></p> <p><span class="cls0">1. The filing of an RBC Report by an insurer which indicates that:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the insurer's Total Adjusted Capital is greater than or equal to its Regulatory Action Level RBC but less than its Company Action Level RBC,&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;if a life or health insurer, the insurer or fraternal benefit society has Total Adjusted Capital which is greater than or equal to its Company Action Level RBC but less than the product of its Authorized Control Level RBC and 3.0 and has a negative trend, or&nbsp;</span></p> <p class="cls2"><span class="cls0">c.&nbsp;&nbsp;if a property and casualty insurer, the insurer has total adjusted capital which is greater than or equal to its Company Action Level RBC but less than the product of its Authorized Control Level RBC and 3.0 and triggers the trend test determined in accordance with the trend test calculation included in the Property and Casualty RBC instructions;&nbsp;</span></p> <p><span class="cls0">2. The notification by the Insurance Commissioner to the insurer of an Adjusted RBC Report that indicates an event described in paragraph 1 of this subsection, provided the insurer does not challenge the Adjusted RBC Report under Section 1528 of this title; or&nbsp;</span></p> <p><span class="cls0">3. If, pursuant to Section 1528 of this title, an insurer challenges an Adjusted RBC Report that indicates the event described in paragraph 1 of this subsection, the notification by the Commissioner to the insurer that the Commissioner has, after opportunity for a hearing, rejected the insurer's challenge.&nbsp;</span></p> <p><span class="cls0">B. In the event of a Company Action Level Event, the insurer shall, unless otherwise directed by the Commissioner, prepare and submit to the Commissioner an RBC Plan which shall include the following five elements:&nbsp;</span></p> <p><span class="cls0">1. Conditions which contribute to the Company Action Level Event;&nbsp;</span></p> <p><span class="cls0">2. Proposals of corrective actions which the insurer intends to take and which would be expected to result in the elimination of the Company Action Level Event;&nbsp;</span></p> <p><span class="cls0">3. Projections of the insurer's financial results in the current year and at least the four (4) succeeding years, both in the absence of proposed corrective actions and giving effect to the proposed corrective actions, including projections of statutory operating income, net income, or capital and surplus. Unless the Commissioner otherwise directs, the projections for both new and renewal business shall include separate projections for each major line of business and separately identify each significant income, expense and benefit component;&nbsp;</span></p> <p><span class="cls0">4. The key assumptions impacting the insurer's projections and the sensitivity of the projections to the assumptions; and&nbsp;</span></p> <p><span class="cls0">5. The quality of, and problems associated with, the insurer's business, including, but not limited to, its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business, and use of reinsurance, if any, in each case.&nbsp;</span></p> <p><span class="cls0">C. The RBC Plan shall be submitted:&nbsp;</span></p> <p><span class="cls0">1. Within forty-five (45) days of the Company Action Level Event; or&nbsp;</span></p> <p><span class="cls0">2. If the insurer challenges an Adjusted RBC Report pursuant to Section 1528 of this title, within forty-five (45) days after notification to the insurer that the Commissioner has, after opportunity for a hearing, rejected the insurer's challenge.&nbsp;</span></p> <p><span class="cls0">D. Within sixty (60) days after the submission by an insurer of an RBC Plan to the Commissioner, the Commissioner shall notify the insurer whether the RBC Plan shall be implemented or is, in the judgment of the Commissioner, unsatisfactory. If the Commissioner determines the RBC Plan is unsatisfactory, the notification to the insurer shall set forth the reasons for the determination, and may set forth proposed revisions which will render the RBC Plan satisfactory, in the judgment of the Commissioner. Upon notification from the Commissioner, the insurer shall prepare a Revised RBC Plan, which may incorporate by reference any revisions proposed by the Commissioner, and shall submit the Revised RBC Plan to the Commissioner:&nbsp;</span></p> <p><span class="cls0">1. Within forty-five (45) days after the notification from the Commissioner; or&nbsp;</span></p> <p><span class="cls0">2. If the insurer challenges the notification from the Commissioner under Section 1528 of this title, within forty-five (45) days after a notification to the insurer that the Commissioner has, after opportunity for a hearing, rejected the insurer's challenge.&nbsp;</span></p> <p><span class="cls0">E. In the event of a notification by the Commissioner to an insurer that the insurer's RBC Plan or Revised RBC Plan is unsatisfactory, the Commissioner may at the Commissioner's discretion, subject to the insurer's right to a hearing under Section 1528 of this title, specify in the notification that the notification constitutes a Regulatory Action Level Event.&nbsp;</span></p> <p><span class="cls0">F. Every domestic insurer that files an RBC Plan or Revised RBC Plan with the Commissioner shall file a copy of the RBC Plan or Revised RBC Plan with the insurance commissioner in any state in which the insurer is authorized to do business if:&nbsp;</span></p> <p><span class="cls0">1. The state has an RBC provision substantially similar to subsection A of Section 1531 of this title; and&nbsp;</span></p> <p><span class="cls0">2. The insurance commissioner of that state has notified the insurer of its request for the filing in writing. If such a request is made, the insurer shall file a copy of the RBC Plan or Revised RBC Plan in that state no later than the later of:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;fifteen (15) days after the receipt of the request to file a copy of its RBC Plan or Revised RBC Plan with the state, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;the date on which the RBC Plan or Revised RBC Plan is filed under subsections C and D of this section.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 5, eff. July 1, 1997. Amended by Laws 2011, c. 278, &sect; 26, eff. Nov. 1, 2011; Laws 2013, c. 269, &sect; 6, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1525. Regulatory Action Level Event.&nbsp;</span></p> <p><span class="cls0">A. "Regulatory Action Level Event" means, with respect to any insurer, any of the following events:&nbsp;</span></p> <p><span class="cls0">1. The filing of an RBC Report by the insurer which indicates that the insurer's Total Adjusted Capital is greater than or equal to its Authorized Control Level RBC but less than its Regulatory Action Level RBC;&nbsp;</span></p> <p><span class="cls0">2. The notification by the Insurance Commissioner to an insurer of an Adjusted RBC Report that indicates the event described in paragraph 1 of this subsection, provided the insurer does not challenge the Adjusted RBC Report under Section 9 of this act;&nbsp;</span></p> <p><span class="cls0">3. If, pursuant to Section 9 of this act, the insurer challenges an Adjusted RBC Report that indicates the event described in paragraph 1 of this subsection, the notification by the Commissioner to the insurer that the Commissioner has, after opportunity for a hearing, rejected the insurer's challenge;&nbsp;</span></p> <p><span class="cls0">4. The failure of the insurer to file an RBC Report by the filing date, unless the insurer has provided an explanation for such failure in writing prior to the filing date which is satisfactory to the Commissioner, and has cured the failure within such time as may be allowed by the Commissioner;&nbsp;</span></p> <p><span class="cls0">5. The failure of the insurer to submit an RBC Plan to the Commissioner within the time period set forth in subsection C of Section 5 of this act;&nbsp;</span></p> <p><span class="cls0">6. Notification by the Commissioner to the insurer that:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the RBC Plan or Revised RBC Plan submitted by the insurer is, in the judgment of the Commissioner, unsatisfactory, and&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;such notification constitutes a Regulatory Action Level Event with respect to the insurer, provided the insurer has not challenged the determination under Section 9 of this act;&nbsp;</span></p> <p><span class="cls0">7. If, pursuant to Section 9 of this act, the insurer challenges a determination by the Commissioner under paragraph 6 of this subsection, the notification by the Commissioner to the insurer that the Commissioner has, after opportunity for a hearing, rejected such challenge;&nbsp;</span></p> <p><span class="cls0">8. Notification by the Commissioner to the insurer that the insurer has failed to adhere to its RBC Plan or Revised RBC Plan, but only if the failure has a substantial adverse effect on the ability of the insurer to eliminate the Company Action Level Event in accordance with the RBC Plan or Revised RBC Plan and the Commissioner has so stated in the notification, provided the insurer has not challenged the determination under Section 9 of this act; or&nbsp;</span></p> <p><span class="cls0">9. If, pursuant to Section 9 of this act, the insurer challenges a determination by the Commissioner under paragraph 8 of this subsection, the notification by the Commissioner to the insurer that the Commissioner has, after opportunity for a hearing, rejected the challenge.&nbsp;</span></p> <p><span class="cls0">B. In the event of a Regulatory Action Level Event:&nbsp;</span></p> <p><span class="cls0">1. The insurer shall, unless otherwise directed by the Commissioner, prepare and submit an RBC Plan or, if applicable, a Revised RBC Plan;&nbsp;</span></p> <p><span class="cls0">2. The Commissioner may perform such examination or analysis as the Commissioner deems necessary of the assets, liabilities, and operations of the insurer including a review of its RBC Plan or Revised RBC Plan; and&nbsp;</span></p> <p><span class="cls0">3. Subsequent to the examination or analysis, the Commissioner may issue a corrective order specifying the corrective actions which the Commissioner determines are required.&nbsp;</span></p> <p><span class="cls0">C. In determining corrective actions, the Commissioner may take into account the factors deemed relevant with respect to the insurer based upon the Commissioner's examination or analysis of the assets, liabilities, and operations of the insurer, including, but not limited to, the results of any sensitivity tests undertaken pursuant to the RBC Instructions. The RBC Plan or Revised RBC Plan shall be submitted:&nbsp;</span></p> <p><span class="cls0">1. Within forty-five (45) days after the occurrence of the Regulatory Action Level Event;&nbsp;</span></p> <p><span class="cls0">2. If the insurer challenges an Adjusted RBC Report pursuant to Section 9 of this act, within forty-five (45) days after the notification to the insurer that the Commissioner has, after opportunity for a hearing, rejected the insurer's challenge; or&nbsp;</span></p> <p><span class="cls0">3. If the insurer challenges a Revised RBC Plan pursuant to Section 9 of this act, within forty-five (45) days after the notification to the insurer that the Commissioner has, after opportunity for a hearing, rejected the insurer's challenge.&nbsp;</span></p> <p><span class="cls0">D. The Commissioner may retain actuaries and investment experts and other consultants as may be necessary in the judgment of the Commissioner to review the insurer's RBC Plan or Revised RBC Plan, examine or analyze the assets, liabilities, and operations of the insurer, and formulate a corrective order with respect to the insurer. The fees, costs, and expenses relating to consultants shall be borne by the affected insurer or such other party as directed by the Commissioner.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 6, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1526. Authorized Control Level Event.&nbsp;</span></p> <p><span class="cls0">A. "Authorized Control Level Event" means any of the following events:&nbsp;</span></p> <p><span class="cls0">1. The filing of an RBC Report by the insurer which indicates that the insurer's Total Adjusted Capital is greater than or equal to its Mandatory Control Level RBC but less than its Authorized Control Level RBC;&nbsp;</span></p> <p><span class="cls0">2. The notification by the Insurance Commissioner to the insurer of an Adjusted RBC Report that indicates the event in paragraph 1 of this subsection, provided the insurer does not challenge the Adjusted RBC Report under Section 9 of this act;&nbsp;</span></p> <p><span class="cls0">3. If, pursuant to Section 9 of this act, the insurer challenges an Adjusted RBC Report that indicates the event in paragraph 1 of this subsection, notification by the Commissioner to the insurer that the Commissioner has, after opportunity for a hearing, rejected the insurer's challenge;&nbsp;</span></p> <p><span class="cls0">4. The failure of the insurer to respond, in a manner satisfactory to the Commissioner, to a corrective order, provided the insurer has not challenged the corrective order under Section 9 of this act; or&nbsp;</span></p> <p><span class="cls0">5. If the insurer has challenged a corrective order under Section 9 of this act and the Commissioner has, after opportunity for a hearing, rejected the challenge or modified the corrective order, the failure of the insurer to respond, in a manner satisfactory to the Commissioner, to the corrective order subsequent to rejection or modification by the Commissioner.&nbsp;</span></p> <p><span class="cls0">B. In the event of an Authorized Control Level Event with respect to an insurer, the Commissioner may:&nbsp;</span></p> <p><span class="cls0">1. Take such actions as are required under Section 6 of this act regarding an insurer with respect to which a Regulatory Action Level Event has occurred; or&nbsp;</span></p> <p><span class="cls0">2. If the Commissioner deems it to be in the best interests of the policyholders and creditors of the insurer and of the public, take such actions as are necessary to cause the insurer to be placed under regulatory control under Article 18 or 19 of the Insurance Code. In the event the Commissioner takes such actions, the Authorized Control Level Event shall be deemed sufficient grounds for the Commissioner to take action under Article 18 or 19 of the Insurance Code, and the Commissioner shall have the rights, powers, and duties with respect to the insurer as are set forth in Article 18 or 19 of the Insurance Code. In the event the Commissioner takes actions under this paragraph pursuant to an Adjusted RBC Report, the insurer shall be entitled to notice and opportunity for a hearing as required by the provisions of Article 18 or 19 of the Insurance Code.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 7, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1527. Mandatory Control Level Event.&nbsp;</span></p> <p><span class="cls0">A. "Mandatory Control Level Event" means any of the following events:&nbsp;</span></p> <p><span class="cls0">1. The filing of an RBC Report which indicates that the insurer's Total Adjusted Capital is less than its Mandatory Control Level RBC;&nbsp;</span></p> <p><span class="cls0">2. Notification by the Commissioner to the insurer of an Adjusted RBC Report that indicates the event in paragraph 1 of this subsection, provided the insurer does not challenge the Adjusted RBC Report under Section 1528 of this title; or&nbsp;</span></p> <p><span class="cls0">3. If, pursuant to Section 1528 of this title, the insurer challenges an Adjusted RBC Report that indicates the event in paragraph 1 of this subsection, notification by the Commissioner to the insurer that the Commissioner has, after opportunity for a hearing, rejected the insurer's challenge.&nbsp;</span></p> <p><span class="cls0">B. In the event of a Mandatory Control Level Event:&nbsp;</span></p> <p><span class="cls0">1. With respect to a life insurer or fraternal benefit society, the Commissioner may take the actions necessary to place the insurer under regulatory control under Article 18 or 19 of the Insurance Code. In that event, the Mandatory Control Level Event is deemed sufficient grounds for the Commissioner to take action under Article 18 or 19 of the Insurance Code, and the Commissioner shall have the rights, powers, and duties with respect to the insurer which are set forth in Article 18 or 19 of the Insurance Code. If the Commissioner takes actions pursuant to an Adjusted RBC Report, the insurer shall be entitled to notice and opportunity for a hearing as required by the provisions of Article 18 or 19 of the Insurance Code; and&nbsp;</span></p> <p><span class="cls0">2. With respect to a property and casualty insurer, the Commissioner may take the actions necessary to place the insurer under regulatory control under Article 18 or 19 of the Insurance Code, or, in case of an insurer which is writing no business and which is running-off its existing business, may allow the insurer to continue its run-off under the supervision of the Commissioner. In either event, the Mandatory Control Level Event is deemed sufficient grounds for the Commissioner to take action under Article 18 or 19 of the Insurance Code and the Commissioner shall have the rights, powers, and duties with respect to the insurer which are set forth in Article 18 or 19 of the Insurance Code. If the Commissioner takes actions pursuant to an Adjusted RBC Report, the insurer shall be entitled to notice and opportunity for a hearing as required by the provisions of Article 18 or 19 of the Insurance Code.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 8, eff. July 1, 1997. Amended by Laws 2013, c. 269, &sect; 7, eff. Nov. 1, 2013.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1528. Confidential departmental hearing.&nbsp;</span></p> <p><span class="cls0">The insurer shall have the right to an opportunity for a confidential departmental hearing, on the record, at which the insurer may challenge any determination or action by the Commissioner. The insurer shall notify the Commissioner of its request for a hearing within five (5) days after the notification by the Commissioner of a decision affecting the insurer's substantial rights. Upon receipt of the insurer's request for a hearing, the Commissioner shall set a date for the hearing, which date shall be no less than five (5) days after the date of the insurer's request. The Commissioner may deny a request for hearing if the request is frivolous, or if no factual issues are presented.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 9, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1529. Confidentiality of RBC Reports and Plans.&nbsp;</span></p> <p><span class="cls0">A. RBC Reports and RBC Plans shall be kept confidential by the Insurance Commissioner. This information shall not be subject to subpoena. This information shall be made public by the Commissioner only for the purpose of enforcement actions taken by the Commissioner pursuant to this act or any other provision of the insurance laws of this state.&nbsp;</span></p> <p><span class="cls0">B. Except as otherwise required under the provisions of this act, the making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public, in a newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter, or poster, or over any radio or television station, or in any other way, an advertisement, announcement, or statement containing an assertion, representation, or statement with regard to the RBC Levels of any insurer, or of any component derived in the calculation, by an insurer, agent, broker, or other person engaged in any manner in the insurance business is misleading and is therefore prohibited. Any person who violates this subsection shall be subject to a civil penalty in an amount not less than One Thousand Dollars ($1,000.00) nor more than Ten Thousand Dollars ($10,000.00).&nbsp;</span></p> <p><span class="cls0">C. The RBC Reports and RBC Plans are intended solely for use by the Commissioner in monitoring the solvency of insurers and the need for possible corrective action with respect to insurers. The RBC Reports and RBC Plans shall not be used by the Commissioner for ratemaking nor considered or introduced as evidence in any rate proceeding nor used by the Commissioner to calculate or derive any elements of an appropriate premium level or rate of return for any line of insurance which an insurer or any affiliate is authorized to write.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 10, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1530. Provisions of act supplemental &ndash; Promulgation of rules - Exemptions from act.&nbsp;</span></p> <p><span class="cls0">A. The provisions of this act are supplemental to any other provisions of the laws of this state, and shall not preclude or limit any other powers or duties of the Insurance Commissioner under such laws, including, but not limited to, Article 18 or 19 of the Insurance Code.&nbsp;</span></p> <p><span class="cls0">B. The Commissioner may promulgate reasonable rules necessary for the implementation of this act.&nbsp;</span></p> <p><span class="cls0">C. The Commissioner may exempt from the application of this act in any year any domestic insurer which:&nbsp;</span></p> <p><span class="cls0">1. Writes direct business only in this state; and&nbsp;</span></p> <p><span class="cls0">2. Assumes no reinsurance in excess of five percent (5%) of direct premium written.&nbsp;</span></p> <p><span class="cls0">D. Insurers domiciled in this state that are issuing policies of medical professional liability insurance to physicians, allied health care professionals and health care institutions as defined by Section 2202 of this title on July 1, 2004, which notify the Commissioner in writing of the insurer&rsquo;s election to utilize the moratorium provided in Section 1509 of this title shall be exempt from the provisions of this title which require an insurer to maintain an adequate surplus as regards policyholders as a condition to obtaining or renewal of a license to act as an insurer, until December 31, 2008. The Commissioner shall not enforce any recapitalization plan against any insurer domiciled in this state that is issuing policies of physicians&rsquo;, allied health care professionals&rsquo; and health care institutions&rsquo; professional liability insurance until December 31, 2008.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 11, eff. July 1, 1997. Amended by Laws 2004, c. 368, &sect; 57, eff. July 1, 2004; Laws 2005, c. 44, &sect; 2, eff. Nov. 1, 2005.&nbsp;</span></p> <p>&nbsp;</p> <p><span class="cls0">&sect;36-1531. Foreign insurers.&nbsp;</span></p> <p><span class="cls0">A. 1. Any foreign insurer shall, upon the written request of the Insurance Commissioner, submit to the Commissioner an RBC Report as of the end of the calendar year just ended on a date which is the later of:&nbsp;</span></p> <p class="cls2"><span class="cls0">a.&nbsp;&nbsp;the date an RBC Report would be required to be filed by a domestic insurer under this act, or&nbsp;</span></p> <p class="cls2"><span class="cls0">b.&nbsp;&nbsp;fifteen (15) days after the request is received by the foreign insurer.&nbsp;</span></p> <p><span class="cls0">2. Any foreign insurer shall, at the written request of the Commissioner, promptly submit to the Commissioner a copy of any RBC Plan that is filed with the Insurance Commissioner of any other state.&nbsp;</span></p> <p><span class="cls0">B. 1. The Commissioner may require a foreign insurer to file an RBC Plan with the Commissioner in the event of a Company Action Level Event, Regulatory Action Level Event, or Authorized Control Level Event. The filing shall be made pursuant to the RBC statute applicable in the state of domicile of the insurer or, if no RBC statute is in force in that state, pursuant to the provisions of this act. If the insurance commissioner of the state of domicile of the foreign insurer fails to require the foreign insurer to file an RBC Plan in the manner specified under that state's RBC statute or, if no RBC statute is in force in that state, the filing shall be made pursuant to Section 5 of this act.&nbsp;</span></p> <p><span class="cls0">2. The failure of the foreign insurer to file an RBC Plan with the Commissioner shall be grounds to order the insurer to cease and desist from writing new insurance business in this state.&nbsp;</span></p> <p><span class="cls0">C. In the event of a Mandatory Control Level Event with respect to any foreign insurer, if no domiciliary receiver has been appointed with respect to the foreign insurer under the rehabilitation and liquidation statute applicable in the state of domicile of the foreign insurer, the Commissioner may make application to the Oklahoma County District Court as permitted under Article 19 of the Oklahoma Insurance Code with respect to the liquidation of property of foreign insurers found in this state.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 12, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1532. Immunity for Commissioner and employees.&nbsp;</span></p> <p><span class="cls0">There shall be no liability on the part of, and no cause of action shall arise against, the Insurance Commissioner or the Insurance Department or its employees or agents for any action taken by them in the performance of their powers and duties under this act.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 13, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;36-1533. Notices to insurers - When effective.&nbsp;</span></p> <p><span class="cls0">All notices by the Insurance Commissioner to an insurer which may result in regulatory action hereunder shall be effective upon dispatch if transmitted by registered or certified mail, or in the case of any other transmission shall be effective upon the insurer's receipt of such notice.&nbsp;</span></p> <p><span class="cls0">Added by Laws 1997, c. 229, &sect; 14, eff. July 1, 1997.&nbsp;</span></p> <p class="cls1">&nbsp;</p> <p><span class="cls0">&sect;361601. Scope of article.&nbsp;</span></p> <p><span class="cls0">Except as to Sections 1624 and 1625 and subdivision A of Section 1606 hereof, this article applies to domestic insurers only. This article shall apply to domestic title insurers except as provided in Article 50 (Title Insurers).&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 285, &sect; 1601. &nbsp;</span></p> <p><span class="cls0">&sect;361602. Eligible investments.&nbsp;</span></p> <p><span class="cls0">A. Insurers shall invest in or loan their funds on the security of, and shall hold as assets, only eligible investments as prescribed in this article.&nbsp;</span></p> <p><span class="cls0">B. Any particular investment held by an insurer on the effective date of this Code or any amendment hereto, and which was a legal investment at the time it was made, and which the insurer was legally entitled to possess immediately prior to such effective date, shall be deemed to be an eligible investment.&nbsp;</span></p> <p><span class="cls0">C. The eligibility of an investment shall be determined as of the date of its making or acquisition.&nbsp;</span></p> <p><span class="cls0">D. Any investment limitation based upon the amount of the insurer's assets or particular funds shall relate to assets or funds as shown by the insurer's annual statement as of December 31 last preceding date of investment, or as shown by a current financial statement on file with the Commissioner.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 285, &sect; 1602; Laws 1965, c. 123, &sect; 1; Laws 1967, c. 242, &sect; 2, emerg. eff. May 5, 1967. &nbsp;</span></p> <p><span class="cls0">&sect;361603. Qualification of securities or property as eligible investments.&nbsp;</span></p> <p><span class="cls0">A. No security or investment (other than property or shares acquired pursuant to Sections 1612, 1616 or 1624 of this article) shall be eligible for acquisition unless it is interest bearing or interest accruing or dividend or income paying, is not then in default in any respect, and the insurer is entitled to receive for its exclusive account and benefit the interest or income accruing thereon. Defaults in interest or income occurring subsequent to acquisition of an investment shall not affect allowance thereof as an asset.&nbsp;</span></p> <p><span class="cls0">B. No security or investment shall be eligible for purchase at a price above its market value.&nbsp;</span></p> <p><span class="cls0">C. No provision of this article shall prohibit the acquisition by an insurer of other or additional securities or property if received as a dividend or as a lawful distribution of assets, or if acquired pursuant to a lawful and bona fide agreement of bulk reinsurance, merger, or consolidation. Any investment so acquired through bulk reinsurance, merger, or consolidation, which is not otherwise eligible under this article, shall be disposed of pursuant to Section 1625 of this article.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 286, &sect; 1603; Laws 1965, c. 123, &sect; 2. &nbsp;</span></p> <p><span class="cls0">&sect;361604. Approval of investment.&nbsp;</span></p> <p><span class="cls0">No investment or loan shall be made by an insurer unless the same has been authorized or approved by the insurer's board of directors or by a committee or corporate officer authorized thereby and charged with the duty of supervising or making such investment or loan. The minutes of any such committee shall be recorded and regular reports of such committee shall be submitted to the board of directors. This section does not apply to loans made by a life insurer on policies or annuity contracts.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 286, &sect; 1604; Laws 1965, c. 123, &sect; 3. &nbsp;</span></p> <p><span class="cls0">&sect;361605. Investments in any one person.&nbsp;</span></p> <p><span class="cls0">An insurer shall not, except with the consent of the Insurance Commissioner, have at any one time any combination of checking account moneys, investments in or loans upon the security of the obligations, property, or securities of any one person, institution, corporation, or municipal corporation, aggregating an amount exceeding ten percent (10%) of the insurer's assets. This restriction shall not apply to investments in or loans upon the security of general obligations of the United States or any state of the United States or include policy loans made under Section 1619 of this title, or investments made under Section 1616 of this title.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Amended by Laws 1984, c. 149, &sect; 6, eff. Nov. 1, 1984. &nbsp;</span></p> <p><span class="cls0">&sect;361606. Required capital investments.&nbsp;</span></p> <p><span class="cls0">After the effective date of this act, until an insurer authorized to transact business shall have assets of One Million Dollars ($1,000,000.00) or in the case of insurers authorized to transact business prior to the effective date of this act shall have assets in an amount equal to three (3) times the minimum paidin capital that was required of a like domestic stock insurer on January 1, 1979, it shall invest and maintain its funds only in cash and the securities described in the following sections of this article: Section 1607 (Securities of or guaranteed by the United States); Section 1608 (State and Canadian public obligations); Section 1609 (County, municipal and district obligations); Section 1610 (Public improvement bonds); and Section 1620 (Deposits: Banks, Savings and Loan).&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 286, &sect; 1606; Laws 1959, p. 292, &sect; 8; Laws 1965, c. 123, &sect; 5; Laws 1967, c. 242, &sect; 4, emerg. eff. May 5, 1967; Laws 1980, c. 185, &sect; 8, eff. Oct. 1, 1980. &nbsp;</span></p> <p><span class="cls0">&sect;361607. United States government obligations.&nbsp;</span></p> <p><span class="cls0">An insurer may invest any of its funds in:&nbsp;</span></p> <p><span class="cls0">1. Bonds or other evidences of indebtedness of the United States of America or of any of its agencies or instrumentalities when such obligations are guaranteed as to principal and interest by the United States of America or any agency or instrumentality thereof.&nbsp;</span></p> <p><span class="cls0">2. Bonds or other evidences of indebtedness which are guaranteed as to principal and interest by the United States of America or by any agency or instrumentality of the United States of America.&nbsp;</span></p> <p><span class="cls0">3. Bonds, debentures or other securities of the following agencies of the government of the United States, whether or not such obligations are quaranteed by such government:&nbsp;</span></p> <p><span class="cls0">(a) Commodity credit corporation.&nbsp;</span></p> <p><span class="cls0">(b) Federal national mortgage association and stock thereof when acquired in connection with sale of mortgage loans to such association.&nbsp;</span></p> <p><span class="cls0">(c) Federal land banks, issued under provisions of the Act of Congress entitled the "Federal Farm Loan Act" and approved July 17, 1916, and any acts amendatory or supplementary to that Act.&nbsp;</span></p> <p><span class="cls0">(d) Any federal home loan bank, issued under provisions of the Act of Congress entitled "Federal Home Loan Bank Act" and approved July 22, 1932.&nbsp;</span></p> <p><span class="cls0">(e) The Home Owners' Loan Corporation, created by the Act of Congress entitled "Home Owners' Loan Act of 1933" and approved June 13, 1933.&nbsp;</span></p> <p><span class="cls0">(f) Federal intermediate credit banks, created by the Act of Congress entitled "Agricultural Credits Act of March 4, 1923."&nbsp;</span></p> <p><span class="cls0">(g) Central bank for cooperatives and regional banks for cooperatives organized under the Farm Credit Act of 1933, or by any of such banks.&nbsp;</span></p> <p><span class="cls0">(h) Any other similar agency of the government of the United States and of similar financial quality.&nbsp;</span></p> <p>&nbsp;</p> <p class="cls1"><span class="cls0">Laws 1957, p. 287, &sect; 1607; Laws 1965, c. 123, &sect; 6. &nbsp;</span></p> <p><span class="cls0">&sect;36-1608. State, district or Canadian obligations.&nbsp;</span></p> <p><span class="cls0">An insurer may invest in bond