2019 US Virgin Islands Code
Title 22 - Insurance
Chapter 60 - Third Party Administrators
§ 1521. Definitions

(a) “Affiliate” or “affiliated” means a person who directly or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, another specified person.

(b) “Business entity” means a corporation, association, partnership, limited liability company or other legal entity.

(c) “Collateral” means funds, letters of credit or any item with economic value owned by the payor, but held by an insurer or Third Party Administrator (TPA) if it needs to be used to fulfill premium or loss reimbursement obligations in accordance with a contract between the insurer or TPA and the payor. Collateral includes anticipated loss prepayments made before the payment of losses, pursuant to arrangements where reimbursement is not due until after losses have been paid.

(d) “Commissioner” means the Commissioner of Insurance.

(e) “Control”, including the terms “controlled by” and “under common control with”, means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a commercial contract for goods or non-management services, or otherwise, unless the power is the result of an official position with or corporate office held by the person. Control is presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote, or holds proxies representing, 10 percent or more of the voting securities of any other person. This presumption may be rebutted by a showing section 325(k) of this title that control does not exist in fact. The Commissioner may determine, after furnishing all persons in interest notice and opportunity to be heard and making specific findings of fact to support the determination that control exists in fact notwithstanding the absence of a presumption to that effect.

(f) “GAAP” means United States Generally Accepted Accounting Principles, consistently applied.

(g) “Home state” means the TPA’s state of domicile that has granted the TPA a TPA license. It does not include jurisdictions that are outside of the United States, the District of Columbia, the Commonwealth of Puerto Rico and other U.S. territories.

(h) “Insurer” means an entity licensed in a United States jurisdiction to provide life, annuity, health or stop-loss coverage as an insurance company, health maintenance organization, fraternal benefit society, multiple employer welfare arrangements, employee leasing company, professional employer organization, prepaid hospital or medical care plan.

(i) “Insurance producer” or “producer” means a person required to be licensed under the laws of the Virgin Islands to sell, solicit or negotiate insurance.

(j) “Nonresident TPA” means a TPA whose home state is any United States jurisdiction other than the Virgin Islands.

(k) “Payor” means an insurer or an employer administering its employee benefit plan or the employee benefit plan of an affiliated employer under common management and control.

(l) “Person” means an individual or a business entity.

(m) “Stop-loss Insurance” means insurance protecting an employer or other person responsible for an otherwise self-insured health or life benefit plan against obligations under the plan, but “stop-loss insurance” does not include reinsurance written for an insurance company.

(n) “Third Party Administrator” or “TPA” means a person who directly or indirectly underwrites, collects charges, collateral or premiums from, or adjusts or settles claims on residents of the Virgin Islands, in connection with life, annuity, health or stop-loss coverage. The term does not include a person whose only actions that would otherwise cause it to be considered a TPA consist of:

• (1) A person working for a TPA to the extent that the person’s activities are subject to the supervision and control of the TPA;

• (2) An employer administering its employee’s benefits plan or the employee benefit plan of an affiliated employer under common management and control;

• (3) The administration of a bona fide employee benefit plan established by an employer or an employee organization, or both, for which the insurance laws of the Virgin Islands are pre-empted pursuant to the Employee Retirement Income Security Act of 1974, as the act existed on September 15, 2015;

• (4) A union administering a benefit plan on behalf of its members;

• (5) An insurer administering insurance coverage for its policyholders, subscribers or certificate holders, or those of an affiliated insurer under common management and control;

• (6) An insurer directly or indirectly underwriting, collecting charges, collateral or premiums from, or adjusting or settling claims on behalf of a client that is not a policyholder, subscriber or certificate holder, and that has its United States headquarters or principal location of business in a jurisdiction in which the insurer is licensed to write that coverage;

• (7) An insurer directly or indirectly underwriting, collecting charges, collateral or premiums, or adjusting or settling claims, if the insurer is licensed in the Virgin Islands to write that line of insurance coverage;

• (8) An insurance producer selling insurance or engaged in related activities within the scope of the producer’s license;

• (9) A creditor acting on behalf of its debtors with respect to insurance covering a debt between the creditor and its debtors;

• (10) A trust and its trustees and agents acting pursuant to such trust established in conformity with 29 U.S.C. section 186;

• (11) A trust exempt from taxation under section 501(a) of the Internal Revenue Code and its trustees acting pursuant to such trust, or a custodian and the custodian’s agents acting pursuant to a custodian account which meets the requirements of section 401(f) of the Internal Revenue Code;

• (12) A credit union or a financial institution that is subject to supervision or examination by federal or state banking authorities, or a mortgage lender, when collecting or remitting premiums to licensed insurance producers or to limited lines producers or authorized payors in connection with loan payments;

• (13) A credit card issuing company advancing or collecting insurance premiums or charges from its credit card holders who have authorized collection if that company does not adjust or settle claims;

• (14) An individual adjusting or settling claims in the normal course of that individual’s practice or employment as an attorney at law and who does not collect charges or premiums in connection with insurance coverage;

• (15) A person licensed as a managing general agent in the Virgin Islands when acting within the scope of that license; or

• (16) A business entity that is affiliated with a licensed insurer while acting as a TPA for the direct and assumed insurance business of an affiliated insurer.

(o) “Underwrites” or “underwriting” means, but is not limited to, the acceptance of employer or individual applications for coverage of individuals and the overall planning and coordination of a benefits program.

(p) “Covered Individual” means any individual eligible for life or accident or health benefits under a plan.

(q) “Contributions” means any money charged a covered individual, plan sponsor or other entity to fund the self-insured portion of any plan in accordance with written provisions of the plan or contract of insurance. The term includes administrative fees charged to a covered individual. “Administrative fee” means any compensation paid by a covered individual for services performed by an administrator.

(r) “Premiums” means any money charged a covered individual, plan sponsor or other entity to provide life or accident or health insurance under a plan. The term premium includes amounts paid by or charged to a covered individual plan sponsor or other entity for stop loss or excess insurance.

(s) “Charges” means any compensation paid by a plan sponsor or insurer for services performed by an administrator.

(t) “Third Party Administrator Trust Fund Account” or “TPATFA”, means a special fiduciary account established and maintained by an administrator pursuant to section 1527 from which claims and claims adjustment expenses are disbursed.

(u) “Claims Administrative Services Account” or “CASA”, means a special fiduciary account established and maintained by an administrator pursuant to section 1528 from which claims and claims adjustment expenses are disbursed.

(v) “Financial Institution” means any federal, state or territorial chartered bank or savings and loan institution that is insured by the Federal Deposit Insurance Corporation (FDIC) or the Federal Savings and Loan Insurance Corporation (FSLIC).

(w) “Plan” means any plan, fund or program established or maintained by a plan sponsor or insurer to the extent that the plan, fund or program was established or is maintained to provide through insurance or alternatives to insurance any type of life or health coverage.