Connecticut 2016 Regular Session

Connecticut House Bill HB05051 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	Substitute House Bill No. 5051
	1	+	General Assembly Substitute Bill No. 5051
	2	+	February Session, 2016 _____HB05051INS___031616____
2	3
3		-	Public Act No. 16-119
	4	+	General Assembly
	5	+
	6	+	Substitute Bill No. 5051
	7	+
	8	+	February Session, 2016
	9	+
	10	+	_____HB05051INS___031616____
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5	12		AN ACT ADOPTING THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS' INTERSTATE INSURANCE PRODUCT REGULATION COMPACT.
6	13
7	14		Be it enacted by the Senate and House of Representatives in General Assembly convened:
8	15
9		-	Section 1. (NEW) (Effective July 1, ~~2017~~) Pursuant to terms and conditions of this compact, the state of Connecticut seeks to join with other states and establish the Interstate Insurance Product Regulation Compact, and thus become a member of the Interstate Insurance Product Regulation Commission. The Insurance Commissioner is hereby designated to serve as the representative of this state to the commission.
	16	+	Section 1. (NEW) (Effective July 1, 2016) Pursuant to terms and conditions of this compact, the state of Connecticut seeks to join with other states and establish the Interstate Insurance Product Regulation Compact, and thus become a member of the Interstate Insurance Product Regulation Commission. The Insurance Commissioner is hereby designated to serve as the representative of this state to the commission.
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11	18		ARTICLE I
12	19
13	20		PURPOSES
14	21
15	22		The purposes of this compact are, through means of joint and cooperative action among the compacting states:
16	23
17	24		1. To promote and protect the interest of consumers of individual and group annuity, life insurance, disability income and long-term care insurance products;
18	25
19	26		2. To develop uniform standards for insurance products covered under the compact;
20	27
21	28		3. To establish a central clearinghouse to receive and provide prompt review of insurance products covered under the compact and, in certain cases, advertisements related thereto, submitted by insurers authorized to do business in one or more compacting states;
22	29
23	30		4. To give appropriate regulatory approval to those product filings and advertisements satisfying the applicable uniform standard;
24	31
25	32		5. To improve coordination of regulatory resources and expertise between state insurance departments regarding the setting of uniform standards and review of insurance products covered under the compact;
26	33
27	34		6. To create the Interstate Insurance Product Regulation Commission; and
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29	36		7. To perform these and such other related functions as may be consistent with the state regulation of the business of insurance.
30	37
31	38		ARTICLE II
32	39
33	40		DEFINITIONS
34	41
35	42		For purposes of this compact:
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37	44		1. "Advertisement" means any material designed to create public interest in a product, or induce the public to purchase, increase, modify, reinstate, borrow on, surrender, replace or retain a policy, as more specifically defined in the rules and operating procedures of the commission.
38	45
39	46		2. "Bylaws" mean those bylaws established by the commission for its governance, or for directing or controlling the commission's actions or conduct.
40	47
41	48		3. "Compacting state" means any state which has enacted this compact legislation and which has not withdrawn pursuant to Article XIV, section 1 of this compact, or been terminated pursuant to Article XIV, section 2 of this compact.
42	49
43	50		4. "Commission" means the Interstate Insurance Product Regulation Commission established by this compact.
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45	52		5. "Commissioner" means the chief insurance regulatory official of a state including, but not limited to, commissioner, superintendent, director or administrator.
46	53
47	54		6. "Domiciliary state" means the state in which an insurer is incorporated or organized; or, in the case of an alien insurer, its state of entry.
48	55
49	56		7. "Insurer" means any entity licensed by a state to issue contracts of insurance for any of the lines of insurance covered by this compact.
50	57
51	58		8. "Member" means the person chosen by a compacting state as its representative to the commission, or the member's designee.
52	59
53	60		9. "Non-compacting state" means any state which is not at the time a compacting state.
54	61
55	62		10. "Operating procedures" mean procedures promulgated by the commission implementing a rule, uniform standard or a provision of this compact.
56	63
57	64		11. "Product" means the form of a policy or contract, including any application, endorsement, or related form which is attached to and made a part of the policy or contract, and any evidence of coverage or certificate, for an individual or group annuity, life insurance, disability income or long-term care insurance product that an insurer is authorized to issue.
58	65
59	66		12. "Rule" means a statement of general or particular applicability and future effect promulgated by the commission, including a uniform standard developed pursuant to Article VII of this compact, designed to implement, interpret, or prescribe law or policy or describing the organization, procedure, or practice requirements of the commission, which shall have the force and effect of law in the compacting states.
60	67
61	68		13. "State" means any state, district or territory of the United States of America.
62	69
63	70		14. "Third-party filer" means an entity that submits a product filing to the commission on behalf of an Insurer.
64	71
65	72		15. "Uniform standard" means a standard adopted by the commission for a product line, pursuant to Article VII of this compact, and shall include all of the product requirements in aggregate; provided, that each uniform standard shall be construed, whether express or implied, to prohibit the use of any inconsistent, misleading or ambiguous provisions in a product and the form of the product made available to the public shall not be unfair, inequitable or against public policy as determined by the commission.
66	73
67	74		ARTICLE III
68	75
69	76		ESTABLISHMENT OF THE COMMISSION AND VENUE
70	77
71	78		1. The compacting states hereby create and establish a joint public agency known as the Interstate Insurance Product Regulation Commission. Pursuant to Article IV of this compact, the commission will have the power to develop uniform standards for product lines, receive and provide prompt review of products filed therewith, and give approval to those product filings satisfying applicable uniform standards; provided, it is not intended for the commission to be the exclusive entity for receipt and review of insurance product filings. Nothing herein shall prohibit any insurer from filing its product in any state wherein the insurer is licensed to conduct the business of insurance; and any such filing shall be subject to the laws of the state where filed.
72	79
73	80		2. The Interstate Insurance Product Regulation Commission is a body corporate and politic, and an instrumentality of the compacting states.
74	81
75	82		3. The commission is solely responsible for its liabilities except as otherwise specifically provided in this compact.
76	83
77	84		4. Venue is proper and judicial proceedings by or against the commission shall be brought solely and exclusively in a court of competent jurisdiction where the principal office of the commission is located.
78	85
79	86		ARTICLE IV
80	87
81	88		POWERS OF THE COMMISSION
82	89
83	90		The commission shall have the following powers:
84	91
85	92		1. To promulgate rules, pursuant to Article VII of this compact, which shall have the force and effect of law and shall be binding in the compacting states to the extent and in the manner provided in this compact;
86	93
87	94		2. To exercise its rulemaking authority and establish reasonable uniform standards for products covered under the compact, and advertisement related thereto, which shall have the force and effect of law and shall be binding in the compacting states, but only for those products filed with the commission, provided, that a compacting state shall have the right to opt out of such uniform standard pursuant to Article VII of this compact, to the extent and in the manner provided in this compact, and, provided further, that any uniform standard established by the commission for long-term care insurance products may provide the same or greater protections for consumers as, but shall not provide less than, those protections set forth in the National Association of Insurance Commissioners' Long-Term Care Insurance Model Act and Long-Term Care Insurance Model Regulation, respectively, adopted as of 2001. The commission shall consider whether any subsequent amendments to the National Association of Insurance Commissioners' Long-Term Care Insurance Model Act or Long-Term Care Insurance Model Regulation adopted by the National Association of Insurance Commissioners require amending of the uniform standards established by the commission for long-term care insurance products;
88	95
89	96		3. To receive and review in an expeditious manner products filed with the commission, and rate filings for disability income and long-term care insurance products, and give approval of those products and rate filings that satisfy the applicable uniform standard, where such approval shall have the force and effect of law and be binding on the compacting states to the extent and in the manner provided in the compact;
90	97
91	98		4. To receive and review in an expeditious manner advertisement relating to long-term care insurance products for which uniform standards have been adopted by the commission, and give approval to all advertisement that satisfies the applicable uniform standard. For any product covered under this compact, other than long-term care insurance products, the commission shall have the authority to require an insurer to submit all or any part of its advertisement with respect to that product for review or approval prior to use, if the commission determines that the nature of the product is such that an advertisement of the product could have the capacity or tendency to mislead the public. The actions of the commission as provided in this section shall have the force and effect of law and shall be binding in the compacting states to the extent and in the manner provided in the compact;
92	99
93	100		5. To exercise its rulemaking authority and designate products and advertisement that may be subject to a self-certification process without the need for prior approval by the commission;
94	101
95	102		6. To promulgate operating procedures, pursuant to Article VII of this compact, which shall be binding in the compacting states to the extent and in the manner provided in this compact;
96	103
97	104		7. To bring and prosecute legal proceedings or actions in its name as the commission; provided, that the standing of any state insurance department to sue or be sued under applicable law shall not be affected;
98	105
99	106		8. To issue subpoenas requiring the attendance and testimony of witnesses and the production of evidence;
100	107
101	108		9. To establish and maintain offices;
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103	110		10. To purchase and maintain insurance and bonds;
104	111
105	112		11. To borrow, accept or contract for services of personnel, including, but not limited to, employees of a compacting state;
106	113
107	114		12. To hire employees, professionals or specialists, and elect or appoint officers, and to fix their compensation, define their duties and give them appropriate authority to carry out the purposes of the compact, and determine their qualifications; and to establish the commission's personnel policies and programs relating to, among other things, conflicts of interest, rates of compensation and qualifications of personnel;
108	115
109	116		13. To accept any and all appropriate donations and grants of money, equipment, supplies, materials and services, and to receive, utilize and dispose of the same; provided that at all times the commission shall strive to avoid any appearance of impropriety;
110	117
111	118		14. To lease, purchase, accept appropriate gifts or donations of, or otherwise to own, hold, improve or use, any property, real, personal or mixed; provided that at all times the commission shall strive to avoid any appearance of impropriety;
112	119
113	120		15. To sell, convey, mortgage, pledge, lease, exchange, abandon or otherwise dispose of any property, real, personal or mixed;
114	121
115	122		16. To remit filing fees to compacting states as may be set forth in the bylaws, rules or operating procedures;
116	123
117	124		17. To enforce compliance by compacting states with rules, uniform standards, operating procedures and bylaws;
118	125
119	126		18. To provide for dispute resolution among compacting states;
120	127
121	128		19. To advise compacting states on issues relating to insurers domiciled or doing business in non-compacting jurisdictions, consistent with the purposes of this compact;
122	129
123	130		20. To provide advice and training to those personnel in state insurance departments responsible for product review, and to be a resource for state insurance departments;
124	131
125	132		21. To establish a budget and make expenditures;
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127	134		22. To borrow money;
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129	136		23. To appoint committees, including advisory committees comprising members, state insurance regulators, state legislators or their representatives, insurance industry and consumer representatives, and such other interested persons as may be designated in the bylaws;
130	137
131	138		24. To provide and receive information from, and to cooperate with law enforcement agencies;
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133	140		25. To adopt and use a corporate seal; and
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135	142		26. To perform such other functions as may be necessary or appropriate to achieve the purposes of this compact consistent with the state regulation of the business of insurance.
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137	144		ARTICLE V
138	145
139	146		ORGANIZATION OF THE COMMISSION
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141	148		Section 1. Membership, Voting and Bylaws
142	149
143	150		a. Each compacting state shall have and be limited to one member. Each member shall be qualified to serve in that capacity pursuant to applicable law of the compacting state. Any member may be removed or suspended from office as provided by the law of the state from which he or she shall be appointed. Any vacancy occurring in the commission shall be filled in accordance with the laws of the compacting state wherein the vacancy exists. Nothing herein shall be construed to affect the manner in which a compacting state determines the election or appointment and qualification of its own commissioner.
144	151
145	152		b. Each member shall be entitled to one vote and shall have an opportunity to participate in the governance of the commission in accordance with the bylaws. Notwithstanding any provision herein to the contrary, no action of the commission with respect to the promulgation of a uniform standard shall be effective unless two-thirds of the members vote in favor thereof.
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147	154		c. The commission shall, by a majority of the members, prescribe bylaws to govern its conduct as may be necessary or appropriate to carry out the purposes, and exercise the powers, of the compact, including, but not limited to:
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149	156		(i) Establishing the fiscal year of the commission;
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151	158		(ii) Providing reasonable procedures for appointing and electing members, as well as holding meetings, of the management committee;
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153	160		(iii) Providing reasonable standards and procedures: (I) For the establishment and meetings of other committees, and (II) governing any general or specific delegation of any authority or function of the commission;
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155	162		(iv) Providing reasonable procedures for calling and conducting meetings of the commission that consists of a majority of commission members, ensuring reasonable advance notice of each such meeting and providing for the right of citizens to attend each such meeting with enumerated exceptions designed to protect the public's interest, the privacy of individuals, and insurers' proprietary information, including trade secrets. The commission may meet in camera only after a majority of the entire membership votes to close a meeting in toto or in part. As soon as practicable, the commission must make public (I) a copy of the vote to close the meeting revealing the vote of each member with no proxy votes allowed, and (II) votes taken during such meeting;
156	163
157	164		(v) Establishing the titles, duties and authority and reasonable procedures for the election of the officers of the commission;
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159	166		(vi) Providing reasonable standards and procedures for the establishment of the personnel policies and programs of the commission. Notwithstanding any civil service or other similar laws of any compacting state, the bylaws shall exclusively govern the personnel policies and programs of the commission;
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161	168		(vii) Promulgating a code of ethics to address permissible and prohibited activities of commission members and employees; and
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163	170		(viii) Providing a mechanism for winding up the operations of the commission and the equitable disposition of any surplus funds that may exist after the termination of the compact after the payment and/or reserving of all of its debts and obligations.
164	171
165	172		d. The commission shall publish its bylaws in a convenient form and file a copy thereof and a copy of any amendment thereto, with the appropriate agency or officer in each of the compacting states.
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167	174		Section 2. Management Committee, Officers and Personnel
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169	176		a. A management committee comprising no more than fourteen members shall be established as follows:
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171	178		(i) One member from each of the six compacting states with the largest premium volume for individual and group annuities, life, disability income and long-term care insurance products, determined from the records of the National Association of Insurance Commissioners for the prior year;
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173	180		(ii) Four members from those compacting states with at least two per cent of the market based on the premium volume described above, other than the six compacting states with the largest premium volume, selected on a rotating basis as provided in the bylaws; and
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175	182		(iii) Four members from those compacting states with less than two per cent of the market, based on the premium volume described above, with one selected from each of the four zone regions of the National Association of Insurance Commissioners as provided in the bylaws.
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177	184		b. The management committee shall have such authority and duties as may be set forth in the bylaws, including, but not limited to:
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179	186		(i) Managing the affairs of the commission in a manner consistent with the bylaws and purposes of the commission;
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181	188		(ii) Establishing and overseeing an organizational structure within, and appropriate procedures for, the commission to provide for the creation of uniform standards and other rules, receipt and review of product filings, administrative and technical support functions, review of decisions regarding the disapproval of a product filing, and the review of elections made by a compacting state to opt out of a uniform standard; provided that a uniform standard shall not be submitted to the compacting states for adoption unless approved by two-thirds of the members of the management committee;
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183	190		(iii) Overseeing the offices of the commission; and
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185	192		(iv) Planning, implementing, and coordinating communications and activities with other state, federal and local government organizations in order to advance the goals of the commission.
186	193
187	194		c. The commission shall elect annually officers from the management committee, with each having such authority and duties, as may be specified in the bylaws.
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189	196		d. The management committee may, subject to the approval of the commission, appoint or retain an executive director for such period, upon such terms and conditions and for such compensation as the commission may deem appropriate. The executive director shall serve as secretary to the commission, but shall not be a member of the commission. The executive director shall hire and supervise such other staff as may be authorized by the commission.
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191	198		Section 3. Legislative and Advisory Committees
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193	200		a. A legislative committee comprising state legislators or their designees shall be established to monitor the operations of, and make recommendations to, the commission, including the management committee; provided that the manner of selection and term of any legislative committee member shall be as set forth in the bylaws. Prior to the adoption by the commission of any uniform standard, revision to the bylaws, annual budget or other significant matter as may be provided in the bylaws, the management committee shall consult with and report to the legislative committee.
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195	202		b. The commission shall establish two advisory committees, one of which shall comprise consumer representatives independent of the insurance industry, and the other comprising insurance industry representatives.
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197	204		c. The commission may establish additional advisory committees as its bylaws may provide for the carrying out of its functions.
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199	206		Section 4. Corporate Records of the Commission
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201	208		The commission shall maintain its corporate books and records in accordance with the bylaws.
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203	210		Section 5. Qualified Immunity, Defense and Indemnification
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205	212		a. The members, officers, executive director, employees and representatives of the commission shall be immune from suit and liability, either personally or in their official capacity, for any claim for damage to or loss of property or personal injury or other civil liability caused by or arising out of any actual or alleged act, error or omission that occurred, or that the person against whom the claim is made had a reasonable basis for believing occurred within the scope of commission employment, duties or responsibilities; provided, that nothing in this paragraph shall be construed to protect any such person from suit and/or liability for any damage, loss, injury or liability caused by the intentional or wilful and wanton misconduct of that person.
206	213
207	214		b. The commission shall defend any member, officer, executive director, employee or representative of the commission in any civil action seeking to impose liability arising out of any actual or alleged act, error or omission that occurred within the scope of commission employment, duties or responsibilities, or that the person against whom the claim is made had a reasonable basis for believing occurred within the scope of commission employment, duties or responsibilities; provided, that nothing herein shall be construed to prohibit that person from retaining counsel; and provided further, that the actual or alleged act, error or omission did not result from that person's intentional or wilful and wanton misconduct.
208	215
209	216		c. The commission shall indemnify and hold harmless any member, officer, executive director, employee or representative of the commission for the amount of any settlement or judgment obtained against that person arising out of any actual or alleged act, error or omission that occurred within the scope of commission employment, duties or responsibilities, or that such person had a reasonable basis for believing occurred within the scope of commission employment, duties or responsibilities, provided, that the actual or alleged act, error or omission did not result from the intentional or wilful and wanton misconduct of that person.
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211	218		ARTICLE VI
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213	220		MEETINGS AND ACTS OF THE COMMISSION
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215	222		1. The commission shall meet and take such actions as are consistent with the provisions of this compact and the bylaws.
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217	224		2. Each member of the commission shall have the right and power to cast a vote to which that compacting state is entitled and to participate in the business and affairs of the commission. A member shall vote in person or by such other means as provided in the bylaws. The bylaws may provide for members' participation in meetings by telephone or other means of communication.
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219	226		3. The commission shall meet at least once during each calendar year. Additional meetings shall be held as set forth in the bylaws.
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221	228		ARTICLE VII
222	229
223	230		RULES AND OPERATING PROCEDURES: RULEMAKING FUNCTIONS OF THE COMMISSION AND OPTING OUT OF UNIFORM STANDARDS
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225	232		1. The commission shall promulgate reasonable rules, including uniform standards, and operating procedures in order to effectively and efficiently achieve the purposes of this compact. Notwithstanding the foregoing, in the event the commission exercises its rulemaking authority in a manner that is beyond the scope of the purposes of this compact, or the powers granted hereunder, then such an action by the commission shall be invalid and have no force and effect.
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227	234		2. Rules and operating procedures shall be made pursuant to a rulemaking process that conforms to the Model State Administrative Procedure Act of 1981 as amended, as may be appropriate to the operations of the commission. Before the commission adopts a uniform standard, the commission shall give written notice to the relevant state legislative committees in each compacting state responsible for insurance issues of its intention to adopt the uniform standard. The commission in adopting a uniform standard shall consider fully all submitted materials and issue a concise explanation of its decision.
228	235
229	236		3. A uniform standard shall become effective ninety days after its promulgation by the commission or such later date as the commission may determine; provided, however, that a compacting state may opt out of a uniform standard as provided in this article. "Opt out" shall be defined as any action by a compacting state to decline to adopt or participate in a promulgated uniform standard. All other rules and operating procedures, and amendments thereto, shall become effective as of the date specified in each rule, operating procedure or amendment.
230	237
231	238		4. A compacting state may opt out of a uniform standard, either by legislation or regulation duly promulgated by the Insurance Department under the compacting state's administrative procedure act. If a compacting state elects to opt out of a uniform standard by regulation, it must:
232	239
233	240		a. Give written notice to the commission no later than ten business days after the uniform standard is promulgated, or at the time the state becomes a compacting state; and
234	241
235	242		b. Find that the uniform standard does not provide reasonable protections to the citizens of the state, given the conditions in the state. The commissioner shall make specific findings of fact and conclusions of law, based on a preponderance of the evidence, detailing the conditions in the state which warrant a departure from the uniform standard and determining that the uniform standard would not reasonably protect the citizens of the state. The commissioner must consider and balance the following factors and find that the conditions in the state and needs of the citizens of the state outweigh: (i) The intent of the legislature to participate in, and the benefits of, an interstate agreement to establish national uniform consumer protections for the products subject to this compact; and (ii) the presumption that a uniform standard adopted by the commission provides reasonable protections to consumers of the relevant product. Notwithstanding the foregoing, a compacting state may, at the time of its enactment of this compact, prospectively opt out of all uniform standards involving long-term care insurance products by expressly providing for such opt out in the enacted compact, and such an opt out shall not be treated as a material variance in the offer or acceptance of any state to participate in this compact. Such an opt out shall be effective at the time of enactment of this compact by the compacting state and shall apply to all existing uniform standards involving long-term care insurance products and those subsequently promulgated.
236	243
237	244		5. If a compacting state elects to opt out of a uniform standard, the uniform standard shall remain applicable in the compacting state electing to opt out until such time the opt out legislation is enacted into law or the regulation opting out becomes effective. Once the opt out of a uniform standard by a compacting state becomes effective as provided under the laws of that state, the uniform standard shall have no further force and effect in that state unless and until the legislation or regulation implementing the opt out is repealed or otherwise becomes ineffective under the laws of the state. If a compacting state opts out of a uniform standard after the uniform standard has been made effective in that state, the opt out shall have the same prospective effect as provided under Article XIV of this compact for withdrawals.
238	245
239	246		6. If a compacting state has formally initiated the process of opting out of a uniform standard by regulation, and while the regulatory opt out is pending, the compacting state may petition the commission, at least fifteen days before the effective date of the uniform standard, to stay the effectiveness of the uniform standard in that state. The commission may grant a stay if it determines the regulatory opt out is being pursued in a reasonable manner and there is a likelihood of success. If a stay is granted or extended by the commission, the stay or extension thereof may postpone the effective date by up to ninety days, unless affirmatively extended by the commission; provided, a stay may not be permitted to remain in effect for more than one year unless the compacting state can show extraordinary circumstances which warrant a continuance of the stay, including, but not limited to, the existence of a legal challenge which prevents the compacting state from opting out. A stay may be terminated by the commission upon notice that the rulemaking process has been terminated.
240	247
241	248		7. Not later than thirty days after a rule or operating procedure is promulgated, any person may file a petition for judicial review of the rule or operating procedure; provided, that the filing of such a petition shall not stay or otherwise prevent the rule or operating procedure from becoming effective unless the court finds that the petitioner has a substantial likelihood of success. The court shall give deference to the actions of the commission consistent with applicable law and shall not find the rule or operating procedure to be unlawful if the rule or operating procedure represents a reasonable exercise of the commission's authority.
242	249
243	250		ARTICLE VIII
244	251
245	252		COMMISSION RECORDS AND ENFORCEMENT
246	253
247	254		1. The commission shall promulgate rules establishing conditions and procedures for public inspection and copying of its information and official records, except such information and records involving the privacy of individuals and insurers' trade secrets. The commission may promulgate additional rules under which it may make available to federal and state agencies, including law enforcement agencies, records and information otherwise exempt from disclosure, and may enter into agreements with such agencies to receive or exchange information or records subject to nondisclosure and confidentiality provisions.
248	255
249	256		2. Except as to privileged records, data and information, the laws of any compacting state pertaining to confidentiality or nondisclosure shall not relieve any compacting state commissioner of the duty to disclose any relevant records, data or information to the commission; provided, that disclosure to the commission shall not be deemed to waive or otherwise affect any confidentiality requirement; and further provided, that, except as otherwise expressly provided in this compact, the commission shall not be subject to the compacting state's laws pertaining to confidentiality and nondisclosure with respect to records, data and information in its possession. Confidential information of the commission shall remain confidential after such information is provided to any commissioner.
250	257
251	258		3. The commission shall monitor compacting states for compliance with duly adopted bylaws, rules, including uniform standards, and operating procedures. The commission shall notify any non-complying compacting state in writing of its noncompliance with commission bylaws, rules or operating procedures. If a non-complying compacting state fails to remedy its noncompliance within the time specified in the notice of noncompliance, the compacting state shall be deemed to be in default as set forth in Article XIV of this compact.
252	259
253	260		4. The commissioner of any state in which an insurer is authorized to do business, or is conducting the business of insurance, shall continue to exercise the commissioner's authority to oversee the market regulation of the activities of the insurer in accordance with the provisions of the state's law. The commissioner's enforcement of compliance with the compact is governed by the following provisions:
254	261
255	262		a. With respect to the commissioner's market regulation of a product or advertisement that is approved or certified to the commission, the content of the product or advertisement shall not constitute a violation of the provisions, standards or requirements of the compact except upon a final order of the commission, issued at the request of a commissioner after prior notice to the insurer and an opportunity for hearing before the commission.
256	263
257	264		b. Before a commissioner may bring an action for violation of any provision, standard or requirement of the compact relating to the content of an advertisement not approved or certified to the commission, the commission, or an authorized commission officer or employee, must authorize the action. However, authorization pursuant to this paragraph does not require notice to the insurer, opportunity for hearing or disclosure of requests for authorization or records of the commission's action on such requests.
258	265
259	266		ARTICLE IX
260	267
261	268		DISPUTE RESOLUTION
262	269
263	270		The commission shall attempt, upon the request of a member, to resolve any disputes or other issues that are subject to this compact and which may arise between two or more compacting states, or between compacting states and non-compacting states, and the commission shall promulgate an operating procedure providing for resolution of such disputes.
264	271
265	272		ARTICLE X
266	273
267	274		PRODUCT FILING AND APPROVAL
268	275
269	276		1. Insurers and third-party filers seeking to have a product approved by the commission shall file the product with, and pay applicable filing fees to, the commission. Nothing in this compact shall be construed to restrict or otherwise prevent an insurer from filing its product with the insurance department in any state wherein the insurer is licensed to conduct the business of insurance, and such filing shall be subject to the laws of the states where filed.
270	277
271	278		2. The commission shall establish appropriate filing and review processes and procedures pursuant to commission rules and operating procedures. Notwithstanding any provision herein to the contrary, the commission shall promulgate rules to establish conditions and procedures under which the commission will provide public access to product filing information. In establishing such rules, the commission shall consider the interests of the public in having access to such information, as well as protection of personal medical and financial information and trade secrets, that may be contained in a product filing or supporting information.
272	279
273	280		3. Any product approved by the commission may be sold or otherwise issued in those compacting states for which the insurer is legally authorized to do business.
274	281
275	282		ARTICLE XI
276	283
277	284		REVIEW OF COMMISSION DECISIONS REGARDING FILINGS
278	285
279	286		1. Not later than thirty days after the commission has given notice of a disapproved product or advertisement filed with the commission, the insurer or third-party filer whose filing was disapproved may appeal the determination to a review panel appointed by the commission. The commission shall promulgate rules to establish procedures for appointing such review panels and provide for notice and hearing. An allegation that the commission, in disapproving a product or advertisement filed with the commission, acted arbitrarily, capriciously, or in a manner that is an abuse of discretion or otherwise not in accordance with the law, is subject to judicial review in accordance with Article III, section 4 of this compact.
280	287
281	288		2. The commission shall have authority to monitor, review and reconsider products and advertisement subsequent to their filing or approval upon a finding that the product does not meet the relevant uniform standard. Where appropriate, the commission may withdraw or modify its approval after proper notice and hearing, subject to the appeal process in section 1 of this article.
282	289
283	290		ARTICLE XII
284	291
285	292		FINANCE
286	293
287	294		1. The commission shall pay or provide for the payment of the reasonable expenses of its establishment and organization. To fund the cost of its initial operations, the commission may accept contributions and other forms of funding from the National Association of Insurance Commissioners, compacting states and other sources. Contributions and other forms of funding from other sources shall be of such a nature that the independence of the commission concerning the performance of its duties shall not be compromised.
288	295
289	296		2. The commission shall collect a filing fee from each insurer and third-party filer filing a product with the commission to cover the cost of the operations and activities of the commission and its staff in a total amount sufficient to cover the commission's annual budget.
290	297
291	298		3. The commission's budget for a fiscal year shall not be approved until it has been subject to notice and comment as set forth in Article VII of this compact.
292	299
293	300		4. The commission shall be exempt from all taxation in and by the compacting states.
294	301
295	302		5. The commission shall not pledge the credit of any compacting state, except by and with the appropriate legal authority of that compacting state.
296	303
297	304		6. The commission shall keep complete and accurate accounts of all its internal receipts, including grants and donations, and disbursements of all funds under its control. The internal financial accounts of the commission shall be subject to the accounting procedures established under its bylaws. The financial accounts and reports including the system of internal controls and procedures of the commission shall be audited annually by an independent certified public accountant. Upon the determination of the commission, but no less frequently than every three years, the review of the independent auditor shall include a management and performance audit of the commission. The commission shall make an annual report to the governor and legislature of the compacting states, which shall include a report of the independent audit. The commission's internal accounts shall not be confidential and such materials may be shared with the commissioner of any compacting state upon request provided, however, that any work papers related to any internal or independent audit and any information regarding the privacy of individuals and insurers' proprietary information, including trade secrets, shall remain confidential.
298	305
299	306		7. No compacting state shall have any claim to or ownership of any property held by or vested in the commission or to any commission funds held pursuant to the provisions of this compact.
300	307
301	308		ARTICLE XIII
302	309
303	310		COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT
304	311
305	312		1. Any state is eligible to become a compacting state.
306	313
307	314		2. The compact shall become effective and binding upon legislative enactment of the compact into law by two compacting states; provided, the commission shall become effective for purposes of adopting uniform standards for, reviewing, and giving approval or disapproval of, products filed with the commission that satisfy applicable uniform standards only after twenty-six states are compacting states or, alternatively, by states representing greater than forty per cent of the premium volume for life insurance, annuity, disability income and long-term care insurance products, based on records of the National Association of Insurance Commissioners for the prior year. Thereafter, it shall become effective and binding as to any other compacting state upon enactment of the compact into law by that state.
308	315
309	316		3. Amendments to the compact may be proposed by the commission for enactment by the compacting states. No amendment shall become effective and binding upon the commission and the compacting states unless and until all compacting states enact the amendment into law.
310	317
311	318		ARTICLE XIV
312	319
313	320		WITHDRAWAL, DEFAULT AND TERMINATION
314	321
315	322		Section 1. Withdrawal
316	323
317	324		a. Once effective, the compact shall continue in force and remain binding upon each and every compacting state; provided, that a compacting state may withdraw from the compact ("withdrawing state") by enacting a statute specifically repealing the statute which enacted the compact into law.
318	325
319	326		b. The effective date of withdrawal is the effective date of the repealing statute. However, the withdrawal shall not apply to any product filings approved or self-certified, or any advertisement of such products, on the date the repealing statute becomes effective, except by mutual agreement of the commission and the withdrawing state unless the approval is rescinded by the withdrawing state as provided in paragraph e. of this section.
320	327
321	328		c. The commissioner of the withdrawing state shall immediately notify the management committee in writing upon the introduction of legislation repealing this compact in the withdrawing state.
322	329
323	330		d. The commission shall notify the other compacting states of the introduction of such legislation within ten days after its receipt of notice thereof.
324	331
325	332		e. The withdrawing state is responsible for all obligations, duties and liabilities incurred through the effective date of withdrawal, including any obligations, the performance of which extend beyond the effective date of withdrawal, except to the extent those obligations may have been released or relinquished by mutual agreement of the commission and the withdrawing state. The commission's approval of products and advertisement prior to the effective date of withdrawal shall continue to be effective and be given full force and effect in the withdrawing state, unless formally rescinded by the withdrawing state in the same manner as provided by the laws of the withdrawing state for the prospective disapproval of products or advertisement previously approved under state law.
326	333
327	334		f. Reinstatement following withdrawal of any compacting state shall occur upon the effective date of the withdrawing state reenacting the compact.
328	335
329	336		Section 2. Default
330	337
331	338		a. If the commission determines that any compacting state has at any time defaulted ("defaulting state") in the performance of any of its obligations or responsibilities under this compact, the bylaws or duly promulgated rules or operating procedures, then, after notice and hearing as set forth in the bylaws, all rights, privileges and benefits conferred by this compact on the defaulting state shall be suspended from the effective date of default as fixed by the commission. The grounds for default include, but are not limited to, failure of a compacting state to perform its obligations or responsibilities, and any other grounds designated in commission rules. The commission shall immediately notify the defaulting state in writing of the defaulting state's suspension pending a cure of the default. The commission shall stipulate the conditions and the time period within which the defaulting state must cure its default. If the defaulting state fails to cure the default within the time period specified by the commission, the defaulting state shall be terminated from the compact and all rights, privileges and benefits conferred by this compact shall be terminated from the effective date of termination.
332	339
333	340		b. Product approvals by the commission or product self-certifications, or any advertisement in connection with such product, that are in force on the effective date of termination shall remain in force in the defaulting state in the same manner as if the defaulting state had withdrawn voluntarily pursuant to section 1 of this article.
334	341
335	342		c. Reinstatement following termination of any compacting state requires a reenactment of the compact.
336	343
337	344		Section 3. Dissolution of Compact
338	345
339	346		a. The compact dissolves effective upon the date of the withdrawal or default of the compacting state which reduces membership in the compact to one compacting state.
340	347
341	348		b. Upon the dissolution of this compact, the compact becomes null and void and shall be of no further force or effect, and the business and affairs of the commission shall be wound up and any surplus funds shall be distributed in accordance with the bylaws.
342	349
343	350		ARTICLE XV
344	351
345	352		SEVERABILITY AND CONSTRUCTION
346	353
347	354		1. The provisions of this compact shall be severable; and if any phrase, clause, sentence or provision is deemed unenforceable, the remaining provisions of the compact shall be enforceable.
348	355
349	356		2. The provisions of this compact shall be liberally construed to effectuate its purposes.
350	357
351	358		ARTICLE XVI
352	359
353	360		BINDING EFFECT OF COMPACT AND OTHER LAWS
354	361
355	362		Section 1. Other Laws
356	363
357	364		a. Nothing herein prevents the enforcement of any other law of a compacting state, except as provided in paragraph b. of this section.
358	365
359	366		b. For any product approved or certified to the commission, the rules, uniform standards and any other requirements of the commission shall constitute the exclusive provisions applicable to the content, approval and certification of such products. For advertisement that is subject to the commission's authority, any rule, uniform standard or other requirement of the commission which governs the content of the advertisement shall constitute the exclusive provision that a commissioner may apply to the content of the advertisement. Notwithstanding the foregoing, no action taken by the commission shall abrogate or restrict:
360	367
361	368		(i) The access of any person to state courts;
362	369
363	370		(ii) Remedies available under state law related to breach of contract, tort, or other laws not specifically directed to the content of the product;
364	371
365	372		(iii) State law relating to the construction of insurance contracts; or
366	373
367	374		(iv) The authority of the attorney general of the state, including, but not limited to, maintaining any actions or proceedings, as authorized by law.
368	375
369	376		c. All insurance products filed with individual states shall be subject to the laws of those states.
370	377
371	378		Section 2. Binding Effect of this Compact
372	379
373	380		a. All lawful actions of the commission, including all rules and operating procedures promulgated by the commission, are binding upon the compacting states.
374	381
375	382		b. All agreements between the commission and the compacting states are binding in accordance with their terms.
376	383
377	384		c. Upon the request of a party to a conflict over the meaning or interpretation of commission actions, and upon a majority vote of the compacting states, the commission may issue advisory opinions regarding the meaning or interpretation in dispute.
378	385
379	386		d. In the event any provision of this compact exceeds the constitutional limits imposed on the legislature of any compacting state, the obligations, duties, powers or jurisdiction sought to be conferred by that provision upon the commission shall be ineffective as to that compacting state, and those obligations, duties, powers or jurisdiction shall remain in the compacting state and shall be exercised by the agency thereof to which those obligations, duties, powers or jurisdiction are delegated by law in effect at the time this compact becomes effective.
380	387
381	388		ARTICLE XVII
382	389
383	390		STATE OF CONNECTICUT OPT OUT
384	391
385		-	In accordance with the provisions of Article VII, section 4 of this compact, the state of Connecticut opts out of all existing and prospective uniform standards involving long-term care insurance products and all existing uniform standards involving disability income insurance products in order to preserve the state's statutory requirements governing these insurance products.
	392	+	In accordance with the provisions of Article VII, section 4 of this compact, the state of Connecticut opts out of all existing and prospective uniform standards involving long-term care insurance products, all existing uniform standards involving life insurance products and all existing uniform standards involving disability income insurance products in order to preserve the state's statutory requirements governing these insurance products.
	393	+
	394	+
	395	+
	396	+
	397	+	This act shall take effect as follows and shall amend the following sections:
	398	+	Section 1 July 1, 2016 New section
	399	+
	400	+	This act shall take effect as follows and shall amend the following sections:
	401	+
	402	+	Section 1
	403	+
	404	+	July 1, 2016
	405	+
	406	+	New section
	407	+
	408	+
	409	+
	410	+	INS Joint Favorable Subst.
	411	+
	412	+	INS
	413	+
	414	+	Joint Favorable Subst.