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General Assembly Raised Bill No. 403
February Session, 2024
LCO No. 1363
Referred to Committee on INSURANCE AND REAL ESTATE
Introduced by:
(INS)
AN ACT CONCERNING INSURANCE MARKET CONDUCT AND
INSURANCE LICENSING.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 38a-8 of the 2024 supplement to the general statutes 1
is repealed and the following is substituted in lieu thereof (Effective 2
October 1, 2024): 3
(a) The commissioner shall see that all laws respecting insurance 4
companies and health care centers are faithfully executed and shall 5
administer and enforce the provisions of this title. The commissioner 6
shall have all powers specifically granted, and all further powers that 7
are reasonable and necessary to enable the commissioner to protect the 8
public interest in accordance with the duties imposed by this title, 9
including, but not limited to, the power to order restitution of any sums 10
obtained in violation of any provision of this title, or any regulation or 11
order adopted or issued pursuant to this title by the commissioner, plus 12
interest at the rate set forth in section 37-3a. The commissioner shall pay 13
to the Treasurer all the fees that the commissioner receives. The 14
commissioner may administer oaths in the discharge of the 15 Raised Bill No. 403
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commissioner's duties. 16
(b) The commissioner shall recommend to the General Assembly 17
changes that, in the commissioner's opinion, should be made in the laws 18
relating to insurance. 19
(c) In addition to the specific regulations that the commissioner is 20
required to adopt, the commissioner may adopt such further 21
regulations, in accordance with the provisions of chapter 54, as are 22
reasonable and necessary to implement the provisions of this title. 23
(d) The commissioner shall develop a program of periodic review to 24
ensure compliance by the Insurance Department with the minimum 25
standards established by the National Association of Insurance 26
Commissioners for effective financial surveillance and regulation of 27
insurance companies operating in this state. The commissioner shall 28
adopt regulations, in accordance with the provisions of chapter 54, 29
pertaining to the financial surveillance and solvency regulation of 30
insurance companies and health care centers as are reasonable and 31
necessary to obtain or maintain the accreditation of the Insurance 32
Department by the National Association of Insurance Commissioners. 33
The commissioner shall maintain as confidential any confidential 34
documents or information received from the National Association of 35
Insurance Commissioners, or the International Association of Insurance 36
Supervisors, or any documents or information received from state or 37
federal insurance, banking or securities regulators or similar regulators 38
in a foreign country that are confidential in such jurisdictions. The 39
commissioner may share any information, including confidential 40
information, with the National Association of Insurance 41
Commissioners, the International Association of Insurance Supervisors, 42
or state or federal insurance, banking or securities regulators or similar 43
regulators in a foreign country, provided the commissioner determines 44
that such entities agree to maintain the same level of confidentiality in 45
their jurisdictions as is available in this state. At the expense of a 46
domestic, alien or foreign insurer, the commissioner may engage the 47
services of attorneys, actuaries, accountants and other experts not 48 Raised Bill No. 403
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otherwise part of the commissioner's staff as may be necessary to assist 49
the commissioner in the financial analysis of the insurer, the review of 50
the insurer's license applications, and the review of transactions within 51
a holding company system involving an insurer domiciled in this state. 52
No duties of a person employed by the Insurance Department on 53
November 1, 2002, shall be performed by such attorney, actuary, 54
accountant or expert. 55
(e) The commissioner shall establish a program to reduce costs and 56
increase efficiency through the use of electronic methods to transmit 57
documents, including policy form and rate filings, to and from insurers 58
and the Insurance Department. The commissioner may sit as a member 59
of the board of a consortium organized by or in association with the 60
National Association of Insurance Commissioners for the purpose of 61
coordinating a system for electronic rate and form filing among state 62
insurance departments and insurers. 63
(f) The commissioner shall maintain as confidential information 64
obtained, collected or prepared in connection with examinations, 65
inspections or investigations, and complaints from the public received 66
by the Insurance Department, if such records are protected from 67
disclosure under federal law or state statute or, in the opinion of the 68
commissioner, such records would disclose, or would reasonably lead 69
to the disclosure of: (1) Investigative information the disclosure of which 70
would be prejudicial to such investigation, until such time as the 71
investigation is concluded; or (2) personal, financial or medical 72
information concerning a person who has filed a complaint or inquiry 73
with the Insurance Department, without the written consent of the 74
person or persons to whom the information pertains. 75
(g) The commissioner may, in the commissioner's discretion, engage 76
the services of such third-party actuaries, professionals and specialists 77
that the commissioner deems necessary to assist the commissioner in 78
reviewing any rate, form or similar filing submitted to the commissioner 79
pursuant to this title. The cost of such services shall be borne by the 80
person who submitted such rate, form or similar filing to the 81 Raised Bill No. 403
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commissioner. 82
(h) The commissioner shall promote the development and growth of, 83
and employment opportunities within, the insurance industry in the 84
state. 85
(i) (1) Whenever the commissioner finds that any person has engaged 86
in or is about to engage in any act, practice or omission that constitutes, 87
or will constitute, a violation of any section of this title, or any regulation 88
or order adopted or issued by the commissioner implementing the 89
provisions of this title, the Attorney General may, at the request of the 90
commissioner, bring an action in the superior court for the judicial 91
district of Hartford for an order: (A) Enjoining such act, practice or 92
omission. Upon a showing by the commissioner that such person has 93
engaged in or is about to engage in any such act, practice or omission, 94
the court may issue a permanent or temporary injunction, restraining 95
order or other order, as appropriate. The commissioner shall not be 96
required to post a bond in such action; (B) imposing a penalty not to 97
exceed one hundred thousand dollars per violation against any such 98
person found by the commissioner to have violated any such section, 99
regulation or order; or (C) providing restitution against such person for 100
any sums shown by the commissioner to have been obtained by such 101
person in violation of any such section, regulation or order, plus interest 102
at the rate set forth in section 37-3a. 103
(2) Whenever the commissioner prevails in any action brought under 104
this subsection, the court may allow to the state any costs of such action. 105
Sec. 2. Section 38a-16 of the general statutes is repealed and the 106
following is substituted in lieu thereof (Effective October 1, 2024): 107
(a) (1) The Insurance Commissioner or the commissioner's authorized 108
representative may, as often as the commissioner deems necessary, 109
conduct investigations and hearings in aid of any investigation on any 110
matter under the provisions of this title. Pursuant to any such 111
investigation or hearing, the commissioner or the commissioner's 112
authorized representative may issue data calls, subpoenas, administer 113 Raised Bill No. 403
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oaths, compel testimony, order the production of books, records, papers 114
and documents, and examine books and records. Any person in receipt 115
of an order from the commissioner or the commissioner's authorized 116
representative for the production of books, records, papers or 117
documents shall comply with the order not later than thirty calendar 118
days after the date of such order. If any person refuses to allow the 119
examination of books and records, to appear, to testify or to produce 120
any book, record, paper or document when so ordered, a judge of the 121
Superior Court, upon application of the commissioner or the 122
commissioner's authorized representative, may make such order as may 123
be appropriate to aid in the enforcement of this section. 124
(2) Data provided in response to a data call under this section shall 125
not be subject to disclosure under section 1-210. 126
(b) The Attorney General, at the request of the commissioner, is 127
authorized to apply in the name of the state of Connecticut to the 128
Superior Court for an order temporarily or permanently restraining and 129
enjoining any person from violating any provision of this title. 130
Sec. 3. Subsection (a) of section 38a-15 of the general statutes is 131
repealed and the following is substituted in lieu thereof (Effective October 132
1, 2024): 133
(a) The commissioner shall, as often as the commissioner deems it 134
expedient, undertake a market conduct examination of the affairs of any 135
insurance company, health care center, third-party administrator, as 136
defined in section 38a-720, [or] fraternal benefit society doing business 137
in this state, or any third-party providing administrative, substantive or 138
other services, including, but not limited to, collecting or providing data 139
or data models, to an insurance company, health care center or fraternal 140
benefit society doing business in this state. Any such examination may 141
be conducted in accordance with the procedures and definitions set 142
forth in the National Association of Insurance Commissioners' Market 143
Regulation Handbook. 144
Sec. 4. Subsection (a) of section 38a-790 of the general statutes is 145 Raised Bill No. 403
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repealed and the following is substituted in lieu thereof (Effective October 146
1, 2024): 147
(a) No person shall act as an appraiser for motor vehicle physical 148
damage claims on behalf of any insurance company or firm or 149
corporation engaged in the adjustment or appraisal of motor vehicle 150
claims unless such person has first secured a license from the Insurance 151
Commissioner, and has paid the license fee specified in section 38a-11, 152
for each two-year period or fraction thereof. The license shall be applied 153
for as provided in section 38a-769. The commissioner may waive the 154
requirement for examination in the case of any applicant for a motor 155
vehicle physical damage appraiser's license who is a nonresident of this 156
state and who holds an equivalent license from any other state. Any 157
[such license issued by the commissioner shall be in force until the 158
thirtieth day of June in each odd-numbered year] initial license issued 159
by the commissioner to an appraiser for motor vehicle physical damage 160
claims shall expire two years after the date of the licensee's birthday that 161
preceded the date the license was issued unless sooner revoked or 162
suspended. The license may, in the discretion of the commissioner, be 163
renewed biennially upon payment of the fee specified in section 38a-11. 164
The commissioner may adopt reasonable regulations concerning 165
standards for qualification, suspension or revocation of such licenses 166
and the methods by which licensees shall conduct their business. 167
Sec. 5. Subsection (a) of section 38a-792 of the general statutes is 168
repealed and the following is substituted in lieu thereof (Effective October 169
1, 2024): 170
(a) (1) No person may act as an adjuster of casualty claims for any 171
insurance company or firm or corporation engaged in the adjustment of 172
casualty claims unless such person has first secured a license from the 173
commissioner, and has paid the license fee specified in section 38a-11, 174
for each two-year period or fraction thereof. Application for such license 175
shall be made as provided in section 38a-769. Any [such license issued 176
by the commissioner shall be in force until June thirtieth in each odd-177
numbered year] initial license issued to an adjuster of casualty claims 178 Raised Bill No. 403
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shall expire two years after the date of the licensee's birthday that 179
preceded the date the license was issued unless sooner revoked or 180
suspended. The [person] licensee may, at the discretion of the 181
commissioner, renew the license biennially thereafter upon payment of 182
the fee specified in section 38a-11. 183
(2) The commissioner may waive the examination required under 184
section 38a-769, in the case of any applicant for a casualty claims 185
adjuster's license that (A) is a nonresident of this state or has its principal 186
place of business in another state, and holds an equivalent license from 187
any other state, or (B) at any time within two years next preceding the 188
date of application has been licensed in this state under a license of the 189
same type as the license applied for. 190
This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2024 38a-8
Sec. 2 October 1, 2024 38a-16
Sec. 3 October 1, 2024 38a-15(a)
Sec. 4 October 1, 2024 38a-790(a)
Sec. 5 October 1, 2024 38a-792(a)
Statement of Purpose:
To: (1) Authorize the commissioner to seek legal action for violations of
title 38a of the general statutes, or regulations or orders adopted or
issued pursuant to such title; (2) establish new requirements pertaining
to compliance with investigations or hearings on any matter under the
provisions of title 38a of the general statutes; (3) authorize the Insurance
Department to perform market conduct examinations of third parties
providing services to the insurance industry in this state; and (4) revise
the renewal date for initial licenses issued to appraisers for motor
vehicle physical damage claims and adjusters of casualty claims.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]