EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted
and is intended to be omitted in the law.
SECOND REGULAR SESSION
SENATE COMMITTEE SUBSTITUTE FOR
HOUSE COMMITTEE SUBSTITUTE FOR
HOUSE BILL NO. 2168
101ST GENERAL ASSEMBLY
4926S.04C ADRIANE D. CROUSE, Secretary
AN ACT
To repeal sections 288.132, 303.025, 303.041, 319.129, 375.159, 376.380, and 379.011, RSMo,
and to enact in lieu thereof thirteen new sections relating to insurance, with penalty
provisions and an effective date for certain sections.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Sections 288.132, 303.025, 303.041, 319.129, 1
375.159, 376.380, and 379.011, RSMo, are repealed and thirteen 2
new sections enacted in lieu thereof, to be known as sections 3
288.132, 288.133, 303.025, 303.041, 303.420, 303.422, 303.425, 4
303.430, 303.440, 319.129, 375.159, 376.380, and 379.011, to 5
read as follows:6
288.132. 1. There is hereby created in the state 1
treasury the "Unemployment Automation Fund", which shall 2
consist of money collected [under subsection 1 of section 3
288.131] pursuant to section 288.133 , and such other state 4
funds appropriated by the general assembly. The state 5
treasurer shall be custodian of the fund and may approve 6
disbursements from the fund in accordance with sections 7
30.170 and 30.180. Upon appropriation, m oney in the fund 8
shall be used solely for the purpose of providing automated 9
systems, and the payment of associated costs, to improve the 10
administration of the state's unemployment insurance 11
program. Notwithstanding the provisions of section 33.080 12 SCS HCS HB 2168 2
to the contrary, all moneys remaining in the fund at the end 13
of the biennium shall not revert to the credit of the 14
general revenue fund. The state treasurer shall invest 15
moneys in the fund in the same manner as other funds are 16
invested. Any interest and money earned on such investments 17
shall be credited to the fund. 18
2. The unemployment automation fund shall not be used 19
in whole or in part for any purpose or in any manner that 20
would permit its substitution for, or a corresponding 21
reduction in, federal funds that would be available in its 22
absence to finance expenditures for the administration of 23
this chapter, or cause the appropriate agency of the United 24
States government to withhold any part of an administrative 25
grant which would otherwise be made. 26
288.133. 1. Each employer liable for contributions 1
pursuant to this chapter, except employers with a 2
contribution rate equal to zero, shall pay an annual 3
unemployment automation adjustment in an amount equal to two 4
one-hundredths of one percent of such employer's total 5
taxable wages for the twelve -month period ending the 6
preceding June thirtieth. 7
2. Notwithstanding subsection 1 of this section to the 8
contrary, the division may reduce the automation adjustment 9
percentage to ensure that the total amount of adjustment due 10
from all employers under this section shall not exceed five 11
million dollars annually. 12
3. Each employer liable to pay an automation 13
adjustment shall be notified of the amount due under this 14
section by March thirty -first of each year and such amount 15
shall be considered delinquent thirty days thereafter. 16
Delinquent unemployment automation adjustment amounts may be 17
collected in the manner provided under sections 288.160 and 18 SCS HCS HB 2168 3
288.170. All moneys collected under this section shall be 19
deposited in the unemployment automation fund established in 20
section 288.132. 21
4. For the first quarter of each calendar year, the 22
total amount of contribution otherwise due from each 23
employer liable to p ay contributions under this chapter 24
shall be reduced by the dollar amount of unemployment 25
automation adjustment due from such employer pursuant to 26
subsection 1 of this section. However, the amount of 27
contributions due from such employer for the first quarter 28
of the calendar year in question shall not be reduced below 29
zero. 30
303.025. 1. No owner of a motor vehicle registered in 1
this state, or required to be registered in this state, 2
shall operate, register or maintain registratio n of a motor 3
vehicle, or permit another person to operate such vehicle, 4
unless the owner maintains the financial responsibility 5
which conforms to the requirements of the laws of this 6
state. No nonresident shall operate or permit another 7
person to operate in this state a motor vehicle registered 8
to such nonresident unless the nonresident maintains the 9
financial responsibility which conforms to the requirements 10
of the laws of the nonresident's state of residence. 11
Furthermore, no person shall operat e a motor vehicle owned 12
by another with the knowledge that the owner has not 13
maintained financial responsibility unless such person has 14
financial responsibility which covers the person's operation 15
of the other's vehicle; however, no owner or nonresiden t 16
shall be in violation of this subsection if he or she fails 17
to maintain financial responsibility on a motor vehicle 18
which is inoperable or being stored and not in operation . 19
The director of the department of revenue shall establish by 20 SCS HCS HB 2168 4
rule a process for voluntary suspension of motor vehicle 21
registration for vehicles which are inoperable or being 22
stored and not in operation. The owner or nonresident shall 23
not further operate the vehicle until the owner or 24
nonresident notifies the department of r evenue that the 25
vehicle will be in use, and the department shall reinstate 26
the motor vehicle registration upon receipt of proof of 27
financial responsibility. Owners or nonresidents who 28
operate a motor vehicle during a period of inoperability or 29
storage claimed under this subsection shall be guilty of a 30
class B misdemeanor and may additionally be guilty of a 31
violation of this subsection. Notwithstanding any provision 32
of law to the contrary, the department of revenue may verify 33
motor vehicle financi al responsibility as provided by law, 34
but shall not otherwise take legal or administrative action 35
to enforce the requirements of this section unless, in the 36
discretion of the director, the motor vehicle is determined 37
to have been operated in violation of this section, a motor 38
vehicle registration is applied for in violation of this 39
section, or the motor vehicle on two separate occasions 40
thirty days apart is determined to have its registration 41
maintained in violation of this section . The director may 42
prescribe rules and regulations for the implementation of 43
this section. 44
2. A motor vehicle owner shall maintain the owner's 45
financial responsibility in a manner provided for in section 46
303.160, or with a motor vehicle liability policy which 47
conforms to the requirements of the laws of this state. A 48
nonresident motor vehicle owner shall maintain the owner's 49
financial responsibility which conforms to the requirements 50
of the laws of the nonresident's state of residence. 51 SCS HCS HB 2168 5
3. Any person who violates this section is guilty of a 52
misdemeanor. Except as otherwise provided in this section, 53
a first violation of this section shall be punishable as a 54
class D misdemeanor. A second or subsequent violation of 55
this section [shall] may be [punishable] punished by 56
imprisonment in the county jail for a term not to exceed 57
fifteen days [and/or] and shall be punished by a fine not 58
less than two hundred dollars but not to exceed five hundred 59
dollars. Prior pleas of guilty and prior findings of guilty 60
shall be pleaded and proven in the same manner as required 61
by section 558.021. However, no person shall be found 62
guilty of violating this section if the operator 63
demonstrates to the court that he or she met the financial 64
responsibility requirements o f this section at the time the 65
peace officer, commercial vehicle enforcement officer or 66
commercial vehicle inspector wrote the citation. In 67
addition to any other authorized punishment, the court shall 68
notify the director of revenue of any person convi cted 69
pursuant to this section and shall do one of the following: 70
(1) Enter an order suspending the driving privilege as 71
of the date of the court order. If the court orders the 72
suspension of the driving privilege, the court shall require 73
the defendant to surrender to it any driver's license then 74
held by such person. The length of the suspension shall be 75
as prescribed in subsection 2 of section 303.042. The court 76
shall forward to the director of revenue the order of 77
suspension of driving priv ilege and any license surrendered 78
within ten days; 79
(2) Forward the record of the conviction for an 80
assessment of four points; 81
(3) In lieu of an assessment of points, render an 82
order of supervision as provided in section 302.303. An 83 SCS HCS HB 2168 6
order of supervision shall not be used in lieu of points 84
more than one time in any thirty -six-month period. Every 85
court having jurisdiction pursuant to the provisions of this 86
section shall forward a record of conviction to the Missouri 87
state highway patrol, or at the written direction of the 88
Missouri state highway patrol, to the department of revenue, 89
in a manner approved by the director of the department of 90
public safety. The director shall establish procedures for 91
the record keeping and administration of this section; or 92
(4) For a nonresident, suspend the nonresident's 93
driving privileges in this state in accordance with section 94
303.030 and notify the official in charge of the issuance of 95
licenses and registration certificates in the state in wh ich 96
such nonresident resides in accordance with section 303.080. 97
4. Nothing in sections 303.010 to 303.050, 303.060, 98
303.140, 303.220, 303.290, 303.330 and 303.370 shall be 99
construed as prohibiting the department of commerce and 100
insurance from approving or authorizing those exclusions and 101
limitations which are contained in automobile liability 102
insurance policies and the uninsured motorist provisions of 103
automobile liability insurance policies. 104
5. If a court enters an order of suspension, t he 105
offender may appeal such order directly pursuant to chapter 106
512 and the provisions of section 302.311 shall not apply. 107
6. Any fines owed to the state pursuant to this 108
section may be eligible for payment in installments. The 109
director shall promulgate rules for the application of 110
payment plans, which shall take into account individuals' 111
ability to pay. 112
303.041. 1. Except as otherwise provided in 1
subsection 7 of section 303.425, if the director determines 2
[that as a result of a verification sample or accident 3 SCS HCS HB 2168 7
report that the owner of a motor vehicle has not maintained 4
financial responsibility, or if the director determines as a 5
result of an order of supervision ] that the owner or 6
operator of a motor vehicle has not mai ntained the financial 7
responsibility as required in this chapter, the director 8
shall thirty-three days after mailing notice, suspend the 9
driving privilege of the owner or operator and/or the 10
registration of the vehicle failing to meet such 11
requirement. The notice of suspension shall be mailed to 12
the person at the last known address shown on the 13
department's records. The notice of suspension is deemed 14
received three days after mailing. The notice of suspension 15
shall clearly specify the reason and statutory grounds for 16
the suspension and the effective date of the suspension, the 17
right of the person to request a hearing, the procedure for 18
requesting a hearing, and the date by which that request for 19
a hearing must be made. If the request for a h earing is 20
received by the department prior to the effective date of 21
the suspension, the effective date of the suspension will be 22
stayed until a final order is issued following the hearing. 23
2. Except as otherwise provided by law, neither the 24
fact that subsequent to the date of verification or 25
conviction, the owner acquired the required liability 26
insurance policy nor the fact that the owner terminated 27
ownership of the motor vehicle, shall have any bearing upon 28
the director's decision to suspend. Until it is terminated, 29
the suspension shall remain in force after the registration 30
is renewed or a new registration is acquired for the motor 31
vehicle. The suspension also shall apply to any motor 32
vehicle to which the owner transfers the registratio n. 33
Effective January 1, 2000, the department shall not extend 34 SCS HCS HB 2168 8
any suspension for failure to pay a delinquent late 35
surrender fee pursuant to this subsection. 36
303.420. As used in sections 303.420 to 303.440, 1
unless the context requir es otherwise, the following terms 2
shall mean: 3
(1) "Program", the motor vehicle financial 4
responsibility enforcement and compliance incentive program 5
established under section 303.425; 6
(2) "Qualified agency", the department of revenue, the 7
Missouri state highway patrol, the prosecuting attorney or 8
sheriff's office of any county or city not within a county, 9
the chiefs of police of any city or municipality, or any 10
other authorized law enforcement agency recognized by the 11
state; 12
(3) "System" or "verification system", the web -based 13
resource established under section 303.430 for online 14
verification of motor vehicle financial responsibility. 15
303.422. 1. There is hereby created in the state 1
treasury the "Motor Vehicl e Financial Responsibility 2
Verification and Enforcement Fund", which shall consist of 3
money received by the department of revenue under sections 4
303.420 to 303.440. The state treasurer shall be custodian 5
of the fund. In accordance with sections 30.17 0 and 30.180, 6
the state treasurer may approve disbursements. The fund 7
shall be a dedicated fund and money in the fund shall be 8
used solely by the department of revenue for the 9
administration of sections 303.420 to 303.440. 10
2. Notwithstanding the provisions of section 33.080 to 11
the contrary, any moneys remaining in the fund at the end of 12
the biennium shall not revert to the credit of the general 13
revenue fund. 14 SCS HCS HB 2168 9
3. The state treasurer shall invest moneys in the fund 15
in the same manner as ot her funds are invested. Any 16
interest and moneys earned on such investments shall be 17
credited to the fund. 18
303.425. 1. (1) There is hereby created within the 1
department of revenue the motor vehicle financial 2
responsibility enforce ment and compliance incentive 3
program. The department of revenue may enter into 4
contractual agreements with third -party vendors to 5
facilitate the necessary technology and equipment, 6
maintenance thereof, and associated program management 7
services, and may enter into contractual agreements with the 8
Missouri office of prosecution services as provided in 9
sections 303.420 to 303.440. Where sections 303.420 to 10
303.440 authorize the department of revenue to enter into 11
contracts with a third -party vendor or the Missouri office 12
of prosecution services at its option, the department of 13
revenue shall contract with the Missouri office of 14
prosecution services unless the Missouri office of 15
prosecution services declines to enter into the contract. 16
(2) The department of revenue or a third -party vendor 17
shall utilize technology to compare vehicle registration 18
information with the financial responsibility information 19
accessible through the system. The department of revenue 20
shall utilize this information to identify motorists who are 21
in violation of the motor vehicle financial responsibility 22
law. The department of revenue may offer offenders under 23
this program the option of pretrial diversion as an 24
alternative to statutory fines or reinstatement fees 25
prescribed under the motor vehicle financial responsibility 26
law as a method of encouraging compliance and discouraging 27
recidivism. 28 SCS HCS HB 2168 10
(3) All fees paid to or collected by third -party 29
vendors or the Missouri office of prosecution services under 30
sections 303.420 to 303.440 may come from violator diversion 31
fees generated by the pretrial diversion option established 32
under this section. A contractual agreement between the 33
department of revenue and the Missouri office of prosecution 34
services under sections 303.420 to 303.440 may provide for 35
retention by the Missouri office of prosecution services of 36
part or all of the violator diversion fees as consideration 37
for the contract. 38
2. The department of revenue may authorize law 39
enforcement agencies or third-party vendors to use 40
technology to collect data for the investigation, detection, 41
analysis, and enforcement of the motor vehicle financial 42
responsibility law. 43
3. The department of revenue may authorize traffic 44
enforcement officers, th ird-party vendors, or the Missouri 45
office of prosecution services to administer the processing 46
and issuance of notices of violation, the collection of fees 47
for a violation of the motor vehicle financial 48
responsibility law, or the referral of cases for 49
prosecution, under the program. 50
4. Access to the system shall be restricted to 51
qualified agencies and the third -party vendors with which 52
the department of revenue contracts for purposes of the 53
program, provided that any third -party vendor with wh ich a 54
contract is executed to provide necessary technology, 55
equipment, or maintenance for the program shall be 56
authorized as necessary to collaborate for required updates 57
and maintenance of system software. 58
5. For purposes of the program, any dat a collected and 59
matched to a corresponding vehicle insurance record as 60 SCS HCS HB 2168 11
verified through the system, and any Missouri vehicle 61
registration database, may be used to identify violations of 62
the motor vehicle financial responsibility law. Such 63
corresponding data shall constitute evidence of the 64
violations. 65
6. Except as otherwise provided in this section, the 66
department of revenue shall suspend, in accordance with 67
section 303.041, the registration of any motor vehicle that 68
is determined under the program to be in violation of the 69
motor vehicle financial responsibility law. 70
7. The department of revenue shall send to an owner 71
whose vehicle is identified under the program as being in 72
violation of the motor vehicle financial responsibility law 73
a notice that the vehicle's registration may be suspended 74
unless the owner, within thirty days, provides proof of 75
financial responsibility for the vehicle or proof, in a form 76
specified by the department of revenue, that the owner has a 77
pending criminal charge for a violation of the motor vehicle 78
financial responsibility law. The notice shall include 79
information on steps an individual may take to obtain proof 80
of financial responsibility and a web address to a page on 81
the department of revenue's we bsite where information on 82
obtaining proof of financial responsibility shall be 83
provided. If proof of financial responsibility or a pending 84
criminal charge is not provided within the time allotted, 85
the department of revenue shall provide a notice of 86
suspension and suspend the vehicle's registration in 87
accordance with section 303.041, or shall send a notice of 88
vehicle registration suspension, clearly specifying the 89
reason and statutory grounds for the suspension and the 90
effective date of the suspen sion, the right of the vehicle 91
owner to request a hearing, the procedure for requesting a 92 SCS HCS HB 2168 12
hearing, and the date by which that request for a hearing 93
must be made, as well as informing the owner that the matter 94
will be referred for prosecution if a satis factory response 95
is not received in the time allotted, informing the owner 96
that the minimum penalty for the violation is three hundred 97
dollars and four license points, and offering the owner 98
participation in a pretrial diversion option to preclude 99
referral for prosecution and registration suspension under 100
sections 303.420 to 303.440. The notice of vehicle 101
registration suspension shall give a period of thirty -three 102
days from mailing for the vehicle owner to respond, and 103
shall be deemed received thr ee days after mailing. If no 104
request for a hearing or agreement to participate in the 105
diversion option is received by the department of revenue 106
prior to the date provided on the notice of vehicle 107
registration suspension, the director shall suspend the 108
vehicle's registration, effective immediately, and refer the 109
case to the appropriate prosecuting attorney. If an 110
agreement by the vehicle owner to participate in the 111
diversion option is received by the department of revenue 112
prior to the effective da te provided on the notice of 113
vehicle registration suspension, then upon payment of a 114
diversion participation fee not to exceed two hundred 115
dollars, agreement to secure proof of financial 116
responsibility within the time provided on the notice of 117
suspension, and agreement that such financial responsibility 118
shall be maintained for a minimum of two years, no points 119
shall be assessed to the vehicle owner's driver's license 120
under section 302.302 and the department of revenue shall 121
not take further action against the vehicle owner under 122
sections 303.420 to 303.440, subject to compliance with the 123
terms of the pretrial diversion option. The department of 124 SCS HCS HB 2168 13
revenue shall suspend the vehicle registration of, and shall 125
refer the case to the appropriate prosec uting attorney for 126
prosecution of, participating vehicle owners who violate the 127
terms of the pretrial diversion option. If a request for 128
hearing is received by the department of revenue prior to 129
the effective date provided on the notice of vehicle 130
registration suspension, then for all purposes other than 131
eligibility for participation in the diversion option, the 132
effective date of the suspension shall be stayed until a 133
final order is issued following the hearing. The department 134
of revenue shall suspend the registration of vehicles 135
determined under the final order to have violated the motor 136
vehicle financial responsibility law, and shall refer the 137
case to the appropriate prosecuting attorney for 138
prosecution. Notices under this subsection shall be mailed 139
to the vehicle owner at the last known address shown on the 140
department of revenue's records. The department of revenue 141
or its third-party vendor or the Missouri office of 142
prosecution services shall issue receipts for the collection 143
of diversion participation fees. Except as otherwise 144
provided in subsection 1 of this section, all such fees 145
shall be deposited into the motor vehicle financial 146
responsibility verification and enforcement fund established 147
in section 303.422. A vehicle owner whose registration has 148
been suspended under sections 303.420 to 303.440 may obtain 149
reinstatement of the registration upon providing proof of 150
financial responsibility and payment to the department of 151
revenue of a nonrefundable reinstatement fee equal to the 152
fee that would be applicable under subsection 2 of section 153
303.042 if the registration had been suspended under section 154
303.041. 155 SCS HCS HB 2168 14
8. Data collected or retained under the program shall 156
not be used by any entity for purposes other than 157
enforcement of the motor vehicle financial responsibility 158
law. Data collected and stored by law enforcement under the 159
program shall be considered evidence if noncompliance with 160
the motor vehicle financial responsibility law is 161
confirmed. The evidence, and an affidavit stating that the 162
evidence and system have identified a particular vehicle as 163
being in violation of the motor vehicle financial 164
responsibility law, shall constitute probable cause for 165
prosecution and shall be forwarded in accordance with 166
subsection 7 of this section to the appropriate prosecuting 167
attorney. 168
9. Owners of vehicles identified under the program as 169
being in violation of the motor vehicle financial 170
responsibility law shall be provided with options for 171
disputing such claim s which do not require appearance at any 172
state or local court of law, or administrative facility. 173
Any person who presents timely proof that he or she was in 174
compliance with the motor vehicle financial responsibility 175
law at the time of the alleged viol ation shall be entitled 176
to dismissal of the charge with no assessment of fees or 177
fines. Proof provided by a vehicle owner to the department 178
of revenue that the vehicle was in compliance at the time of 179
the suspected violation of the motor vehicle finan cial 180
responsibility law shall be recorded in the system 181
established by the department of revenue under section 182
303.430. 183
10. The collection of data or use of any technology 184
pursuant to this section shall be done in a manner that 185
prohibits any bias towards a specific community, race, 186
gender, or socioeconomic status of vehicle owner. 187 SCS HCS HB 2168 15
11. Law enforcement agencies, third -party vendors, or 188
other entities authorized to operate under the program shall 189
not sell data collected or retained under th e program for 190
any purpose or share it for any purpose not expressly 191
authorized in this section. All data shall be secured and 192
any third-party vendor or other entity authorized to operate 193
under the program may be liable for any data security breach. 194
12. The department of revenue shall not take action 195
under sections 303.420 to 303.440 against vehicles 196
registered as fleet vehicles under section 301.032, or 197
against vehicles known to the department of revenue to be 198
insured under a policy of commer cial auto coverage, as such 199
term is defined in subdivision (10) of subsection 2 of 200
section 303.430. 201
13. Following one year after the implementation of the 202
program, and every year thereafter, the department of 203
revenue shall provide a report to the president pro tempore 204
of the senate, the speaker of the house of representatives, 205
the chairs of the house and senate committees with 206
jurisdictions over insurance or transportation matters, and 207
the chairs of the house budget and senate appropriations 208
committees. The report shall include an evaluation of 209
program operations, information as to the costs of the 210
program incurred by the department of revenue, insurers, and 211
the public, information as to the effectiveness of the 212
program in reducing the nu mber of uninsured motor vehicles, 213
and anonymized demographic information including the race 214
and zip code of vehicle owners identified under the program 215
as being in violation of the motor vehicle financial 216
responsibility law, and may include any additio nal 217
information and recommendations for improvement of the 218
program deemed appropriate by the department of revenue. 219 SCS HCS HB 2168 16
The department of revenue may, by rule, require the state, 220
counties, and municipalities to provide information in order 221
to complete the report. 222
14. The Missouri office of prosecution services in 223
consultation with the department of revenue may promulgate 224
rules as necessary for the implementation of this section. 225
Any rule or portion of a rule, as that term is defined in 226
section 536.010, that is created under the authority 227
delegated in this section shall become effective only if it 228
complies with and is subject to all of the provisions of 229
chapter 536 and, if applicable, section 536.028. This 230
section and chapter 536 are nonseve rable and if any of the 231
powers vested with the general assembly pursuant to chapter 232
536 to review, to delay the effective date, or to disapprove 233
and annul a rule are subsequently held unconstitutional, 234
then the grant of rulemaking authority and any rul e proposed 235
or adopted after August 28, 2022, shall be invalid and void. 236
303.430. 1. The department of revenue shall establish 1
and maintain a web-based system for the verification of 2
motor vehicle financial responsibility, shall prov ide access 3
to insurance reporting data and vehicle registration and 4
financial responsibility data, and shall require motor 5
vehicle insurers to establish functionality for the 6
verification system, as provided in sections 303.420 to 7
303.440. The verification system, including any exceptions 8
as provided for in sections 303.420 to 303.440 or in the 9
implementation guide developed to support the program, shall 10
supersede any existing verification system, and shall be the 11
sole system used for the purpose of verifying financial 12
responsibility required under this chapter. 13
2. The system established pursuant to subsection 1 of 14
this section shall be subject to the following: 15 SCS HCS HB 2168 17
(1) The verification system shall transmit requests to 16
insurers for verification of motor vehicle insurance 17
coverage via web services established by the insurers 18
through the internet in compliance with the specifications 19
and standards of the Insurance Industry Committee on Motor 20
Vehicle Administration, or "IICMVA". Insurance company 21
systems shall respond to each request with a prescribed 22
response upon evaluation of the data provided in the 23
request. The system shall include appropriate protections 24
to secure its data against unauthorized access, and the 25
department of revenue shall maintain a historical record of 26
the system data for a period of no more than twelve months 27
from the date of all requests and responses. The system 28
shall be used for verification of the financial 29
responsibility required under this chapter. The system 30
shall be accessible to authorized personnel of the 31
department of revenue, the courts, law enforcement 32
personnel, and other entities authorized by the state as 33
permitted by state or federal privacy laws, and it shall be 34
interfaced, wherever appropriate, with existing state 35
systems. The system shall include information enabling the 36
department of revenue to submit inquiries to insurers 37
regarding motor vehicle insurance which are consistent with 38
insurance industry and IICMVA recommendatio ns, 39
specifications, and standards by using the following data 40
elements for greater matching accuracy: insurer National 41
Association of Insurance Commissioners, or "NAIC", company 42
code; vehicle identification number; policy number; 43
verification date; o r as otherwise described in the 44
specifications and standards of the IICMVA. The department 45
of revenue shall promulgate rules to offer insurers who 46
insure one thousand or fewer vehicles within this state an 47 SCS HCS HB 2168 18
alternative method for verifying motor vehicl e insurance 48
coverage in lieu of web services, and to provide for the 49
verification of financial responsibility when financial 50
responsibility is proven to the department to be maintained 51
by means other than a policy of motor vehicle insurance. 52
Insurers shall not be required to verify insurance coverage 53
for vehicles registered in other jurisdictions; 54
(2) The verification system shall respond to each 55
request within a time period established by the department 56
of revenue. An insurer's system shall respond within the 57
time period prescribed by the IICMVA's specifications and 58
standards. Insurer systems shall be permitted reasonable 59
system downtime for maintenance and other work with advance 60
notice to the department of revenue. Insurers shall not be 61
subject to enforcement fees or other sanctions under such 62
circumstances, or when systems are not available because of 63
emergency, outside attack, or other unexpected outages not 64
planned by the insurer and reasonably outside its control; 65
(3) The system shall assist in identifying violations 66
of the motor vehicle financial responsibility law in the 67
most effective way possible. Responses to individual 68
insurance verification requests shall have no bearing on 69
whether insurance coverage is determ ined to be in force at 70
the time of a claim. Claims shall be individually 71
investigated to determine the existence of coverage. 72
Nothing in sections 303.420 to 303.440 shall prohibit the 73
department of revenue from contracting with a third -party 74
vendor or vendors who have successfully implemented similar 75
systems in other states to assist in establishing and 76
maintaining this verification system; 77
(4) The department of revenue shall consult with 78
representatives of the insurance industry and may con sult 79 SCS HCS HB 2168 19
with third-party vendors to determine the objectives, 80
details, and deadlines related to the system by 81
establishment of an advisory council. The advisory council 82
shall consist of voting members comprised of: 83
(a) The director of the departmen t of commerce and 84
insurance, or his or her designee, who shall serve as chair; 85
(b) Two representatives of the department of revenue, 86
to be appointed by the director of the department of revenue; 87
(c) One representative of the department of com merce 88
and insurance, to be appointed by the director of the 89
department of commerce and insurance; 90
(d) Three representatives of insurance companies, to 91
be appointed by the director of the department of commerce 92
and insurance; 93
(e) One representative from the Missouri Insurance 94
Coalition; 95
(f) One representative chosen by the National 96
Association of Mutual Insurance Companies; 97
(g) One representative chosen by the American Property 98
and Casualty Insurance Association; 99
(h) One representative chosen by the Missouri 100
Independent Agents Association; and 101
(i) Such other representatives as may be appointed by 102
the director of the department of commerce and insurance; 103
(5) The department of revenue shall publish for 104
comment, and then issue, a detailed implementation guide for 105
its online verification system; 106
(6) The department of revenue and its third -party 107
vendors, if any, shall each maintain a contact person for 108
insurers during the establishment, implementation, an d 109
operation of the system; 110 SCS HCS HB 2168 20
(7) If the department of revenue has reason to believe 111
a vehicle owner does not maintain financial responsibility 112
as required under this chapter, it may also request an 113
insurer to verify the existence of such financial 114
responsibility in a form approved by the department of 115
revenue. In addition, insurers shall cooperate with the 116
department of revenue in establishing and maintaining the 117
verification system established under this section, and 118
shall provide motor vehic le insurance policy status 119
information as provided in the rules promulgated by the 120
department of revenue; 121
(8) Every property and casualty insurance company 122
licensed to issue motor vehicle insurance or authorized to 123
do business in this state shall comply with sections 303.420 124
to 303.440, and corresponding rules promulgated by the 125
department of revenue, for the verification of such 126
insurance for every vehicle insured by that company in this 127
state; 128
(9) Insurers shall maintain a historical r ecord of 129
insurance data for a minimum period of six months from the 130
date of policy inception or policy change for the purpose of 131
historical verification inquiries; 132
(10) For the purposes of this section, "commercial 133
auto coverage" shall mean any c overage provided to an 134
insured, regardless of number of vehicles or entities 135
covered, under a commercial coverage form and rated from a 136
commercial manual approved by the department of commerce and 137
insurance. Sections 303.420 to 303.440 shall not apply to 138
vehicles insured under commercial auto coverage; however, 139
insurers of such vehicles may participate on a voluntary 140
basis, and vehicle owners may provide proof at or subsequent 141
to the time of vehicle registration that a vehicle is 142 SCS HCS HB 2168 21
insured under commercial auto coverage, which the department 143
of revenue shall record in the system; 144
(11) Insurers shall provide commercial or fleet 145
automobile customers with evidence reflecting that the 146
vehicle is insured under a commercial or fleet automobile 147
liability policy. Sufficient evidence shall include an 148
insurance identification card clearly marked with a suitable 149
identifier such as "commercial auto insurance identification 150
card", "fleet auto insurance identification card", or other 151
clear identification that the vehicle is insured under a 152
fleet or commercial policy; 153
(12) Notwithstanding any provision of sections 303.420 154
to 303.440, insurers shall be immune from civil and 155
administrative liability for good faith efforts to comply 156
with the terms of sections 303.420 to 303.440; 157
(13) Nothing in this section shall prohibit an insurer 158
from using the services of a third -party vendor for 159
facilitating the verification system required under sections 160
303.420 to 303.440. 161
3. The department of revenue shall promulgate rules as 162
necessary for the implementation of sections 303.420 to 163
303.440. Any rule or portion of a rule, as that term is 164
defined in section 536.010, that is created under the 165
authority delegated in this section shall become effective 166
only if it complies with and is subject to all of the 167
provisions of chapter 536 and, if applicable, section 168
536.028. This section and chapter 536 are nonseverable and 169
if any of the powers vested with the general assembly 170
pursuant to chapter 536 to review, to delay the effective 171
date, or to disapprove and annul a rule are subsequently 172
held unconstitutional, then the grant of rulemaking 173 SCS HCS HB 2168 22
authority and any rule proposed or adopted after August 28, 174
2022, shall be invalid and void. 175
303.440. The verification system established under 1
section 303.430 shall be installed and fully operational on 2
January 1, 2024, following an appropriate testing or pilot 3
period of not less than nine months. Until the successful 4
completion of the testing or pilot period in the judgment of 5
the director of the department of revenue, no enforcement 6
action shall be taken based on the system, including but not 7
limited to action taken under the program established under 8
section 303.425. 9
319.129. 1. There is hereby created a special trust 1
fund to be known as the "Petroleum Storage Tank Insurance 2
Fund" within the state treasury which shall be the successor 3
to the underground storage tank insurance fund. Moneys in 4
such special trust fund shall not be deemed to be state 5
funds. Notwithstanding the provisions of section 33.080 to 6
the contrary, moneys in the fund shall not be transferred to 7
general revenue at the end of each biennium. 8
2. The owner or operato r of any underground storage 9
tank, including the state of Missouri and its political 10
subdivisions and public transportation systems, in service 11
on August 28, 1989, shall submit to the department a fee of 12
one hundred dollars per tank on or before Decemb er 31, 13
1989. The owner or operator of any underground storage tank 14
who seeks to participate in the petroleum storage tank 15
insurance fund, including the state of Missouri and its 16
political subdivisions and public transportation systems, 17
and whose underground storage tank is brought into service 18
after August 28, 1998, shall transmit one hundred dollars 19
per tank to the board with his or her initial application. 20
Such amount shall be a one -time payment, and shall be in 21 SCS HCS HB 2168 23
addition to the payment required by section 319.133. The 22
owner or operator of any aboveground storage tank regulated 23
by this chapter, including the state of Missouri and its 24
political subdivisions and public transportation systems, 25
who seeks to participate in the petroleum storage t ank 26
insurance fund, shall transmit one hundred dollars per tank 27
to the board with his or her initial application. Such 28
amount shall be a one -time payment and shall be in addition 29
to the payment required by section 319.133. Moneys received 30
pursuant to this section shall be transmitted to the 31
director of revenue for deposit in the petroleum storage 32
tank insurance fund. 33
3. The state treasurer may deposit moneys in the fund 34
in any of the qualified depositories of the state. All such 35
deposits shall be secured in a manner and upon the terms as 36
are provided by law relative to state deposits. Interest 37
earned shall be credited to the petroleum storage tank 38
insurance fund. 39
4. The general administration of the fund and the 40
responsibility for the proper operation of the fund, 41
including all decisions relating to payments from the fund, 42
are hereby vested in a board of trustees. The board of 43
trustees shall consist of the commissioner of administration 44
or the commissioner's designee, the dir ector of the 45
department of natural resources or the director's designee, 46
the director of the department of agriculture or the 47
director's designee, and eight citizens appointed by the 48
governor with the advice and consent of the senate. Three 49
of the appointed members shall be owners or operators of 50
retail petroleum storage tanks, including one tank owner or 51
operator of greater than one hundred tanks; one tank owner 52
or operator of less than one hundred tanks; and one 53 SCS HCS HB 2168 24
aboveground storage tank owner or operator. One appointed 54
trustee shall represent a financial lending institution, and 55
one appointed trustee shall represent the insurance 56
underwriting industry. One appointed trustee shall 57
represent industrial or commercial users of petroleum. The 58
two remaining appointed citizens shall have no petroleum - 59
related business interest, and shall represent the 60
nonregulated public at large. The members appointed by the 61
governor shall serve four -year terms except that the 62
governor shall designate two of the original appointees to 63
be appointed for one year, two to be appointed for two 64
years, two to be appointed for three years and two to be 65
appointed for four years. Any vacancies occurring on the 66
board shall be filled in the same manner as provided i n this 67
section. 68
5. [The board shall meet in Jefferson City, Missouri, 69
within thirty days following August 28, 1996. Thereafter,] 70
The board shall meet upon the written call of the chairman 71
of the board or by the agreement of any six members of th e 72
board. Notice of each meeting shall be delivered to all 73
other trustees in person or by registered mail not less than 74
six days prior to the date fixed for the meeting. The board 75
may meet at any time by unanimous mutual consent. There 76
shall be at least one meeting in each quarter. 77
6. Six trustees shall constitute a quorum for the 78
transaction of business, and any official action of the 79
board shall be based on a majority vote of the trustees 80
present. 81
7. The trustees shall serve without compensation but 82
shall receive from the fund their actual and necessary 83
expenses incurred in the performance of their duties for the 84
board. 85 SCS HCS HB 2168 25
8. The board of trustees shall be a type III agency 86
and shall appoint an executive director and other empl oyees 87
as needed, who shall be state employees and be eligible for 88
all corresponding benefits. The executive director shall 89
have charge of the offices, operations, records, and other 90
employees of the board, subject to the direction of the 91
board. Employees of the board shall receive such salaries 92
and necessary expenses as shall be fixed by the board. 93
9. Staff resources for the Missouri petroleum storage 94
tank insurance fund may be provided by the department of 95
natural resources or another state agency as otherwise 96
specifically determined by the board. The fund shall 97
compensate the department of natural resources or other 98
state agency for all costs of providing staff required by 99
this subsection. Such compensation shall be made pursuant 100
to contracts negotiated between the board and the department 101
of natural resources or other state agency. 102
10. In order to carry out the fiduciary management of 103
the fund, the board may select and employ, or may contract 104
with, persons experienced in ins urance underwriting, 105
accounting, the servicing of claims and rate making, and 106
legal counsel to defend third -party claims, who shall serve 107
at the board's pleasure. Invoices for such services shall 108
be presented to the board in sufficient detail to allow a 109
thorough review of the costs of such services. 110
11. [At the first meeting of the board, ] The board 111
shall elect one of its members as chairman. The chairman 112
shall preside over meetings of the board and perform such 113
other duties as shall be requ ired by action of the board. 114
12. The board shall elect one of its members as vice 115
chairman, and the vice chairman shall perform the duties of 116 SCS HCS HB 2168 26
the chairman in the absence of the latter or upon the 117
chairman's inability or refusal to act. 118
13. The board shall determine and prescribe all rules 119
and regulations as they relate to fiduciary management of 120
the fund, pursuant to the purposes of sections 319.100 to 121
319.137. In no case shall the board have oversight 122
regarding environmental cleanup sta ndards for petroleum 123
storage tanks. 124
14. No trustee or staff member of the fund shall 125
receive any gain or profit from any moneys or transactions 126
of the fund. This shall not preclude any eligible trustee 127
from making a claim or receiving benefits f rom the petroleum 128
storage tank insurance fund as provided by sections 319.100 129
to 319.137. 130
15. The board may reinsure all or a portion of the 131
fund's liability. Any insurer who sells environmental 132
liability insurance in this state may, at the opti on of the 133
board, reinsure some portion of the fund's liability. 134
16. The petroleum storage tank insurance fund shall 135
expire on December 31, [2025] 2030, unless extended by 136
action of the general assembly. After December 31, [2025] 137
2030, the board of trustees may continue to function for the 138
sole purpose of completing payment of claims made prior to 139
December 31, [2025] 2030. 140
17. The board shall annually commission an independent 141
financial audit of the petroleum storage tank insurance 142
fund. The board shall biennially commission an actuarial 143
analysis of the petroleum storage tank insurance fund. The 144
results of the financial audit and the actuarial analysis 145
shall be made available to the public. The board may 146
contract with third parties to carry out the requirements of 147
this subsection. 148 SCS HCS HB 2168 27
375.159. 1. As used in this section, the following 1
terms shall mean: 2
(1) "Aggregator site", a website that provides 3
information regarding insurance products from more than one 4
insurer, including product and insurer information, for use 5
in comparison shopping; 6
(2) "Blanket travel insurance", a policy of travel 7
insurance issued to any eligible group providing coverage 8
for specific classes of persons defined in the polic y, with 9
coverage provided to all members of the eligible group 10
without a separate charge to individual members of the 11
eligible group; 12
(3) "Cancellation fee waiver", a contractual agreement 13
between a supplier of travel services and its customer to 14
waive some or all of the nonrefundable cancellation fee 15
provisions of the supplier's underlying travel contract with 16
or without regard to the reason for the cancellation or form 17
of reimbursement. A cancellation fee waiver is not 18
insurance; 19
(4) "Director", the director of the department of 20
commerce and insurance; 21
(5) "Eligible group", solely for the purpose of travel 22
insurance, two or more persons who are engaged in a common 23
enterprise or have an economic, educational, or social 24
affinity or relationship, including but not limited to any 25
of the following: 26
(a) Any entity engaged in the business of providing 27
travel or travel services, including but not limited to: 28
tour operators, lodging providers, vacation property owners, 29
hotels and resorts, travel clubs, travel agencies, property 30
managers, cultural exchange programs, and common carriers or 31
the operator, owner, or lessor of a means of transportation 32 SCS HCS HB 2168 28
of passengers including, but not limited to, airlines, 33
cruise lines, railro ads, steamship companies, and public bus 34
carriers, in which there is a common exposure to risk 35
attendant to the particular type of travel or traveler for 36
all members or customers of the group; 37
(b) Any college, school, or other institution of 38
learning, covering students, teachers, employees, or 39
volunteers; 40
(c) Any employer covering any group of employees, 41
volunteers, contractors, members of boards of directors, 42
dependents, or guests; 43
(d) Any sports team, camp, or sponsor thereof, 44
covering participants, members, campers, employees, 45
officials, supervisors, or volunteers; 46
(e) Any religious, charitable, recreational, 47
educational, or civic organization, or branch thereof, 48
covering any group of members, participants, or volunteers ; 49
(f) Any financial institution, financial institution 50
vendor, or parent holding company, trustee, or agent of or 51
designated by one or more financial institutions or 52
financial institution vendors, including accountholders, 53
credit card holders, de btors, guarantors, or purchasers; 54
(g) Any incorporated or unincorporated association, 55
including any labor union, having a common interest, 56
constitution, and bylaws, and organized and maintained in 57
good faith for purposes other than obtaining insur ance for 58
members or participants of such association covering its 59
members; 60
(h) Any trust or the trustees of a fund established, 61
created, or maintained for the benefit of and covering 62
members, employees, or customers of one or more associations 63
meeting the requirements of paragraph (g) of this 64 SCS HCS HB 2168 29
subdivision, subject to the director's permission of the use 65
of a trust and the state's premium tax provisions described 66
in subsection 4 of this section; 67
(i) Any entertainment production company cov ering any 68
group of participants, volunteers, audience members, 69
contestants, or workers; 70
(j) Any volunteer fire department, ambulance, rescue, 71
police, court, first aid, civil defense, or other such 72
volunteer group; 73
(k) Preschools, day care i nstitutions for children or 74
adults, and senior citizen clubs; 75
(l) Any automobile or truck rental or leasing company 76
covering a group of persons who may become renters, lessees, 77
or passengers defined by their travel status on the rented 78
or leased vehicles. The common carrier; the operator, 79
owner, or lessor of a means of transportation; or the 80
automobile or truck rental or leasing company is the 81
policyholder under a policy to which this section applies; or 82
(m) Any other group for which the director has 83
determined that the members are engaged in a common 84
enterprise or have an economic, educational, or social 85
affinity or relationship and that issuance of the policy 86
would not be contrary to the public interest; 87
(6) "Fulfillment materials", documentation sent to the 88
purchaser of a travel protection plan confirming the 89
purchase and providing the travel protection plan's coverage 90
and assistance details; 91
(7) "Group travel insurance", travel insurance issued 92
to any eligible group ; 93
(8) "Limited lines travel insurance producer", a: 94 SCS HCS HB 2168 30
(a) Licensed managing general agent as provided by 95
sections 375.147 to 375.153 or third-party administrator; 96
[or] 97
(b) Licensed insurance producer as provided by chapter 98
375[;], including a limited lines producer, designated by 99
the insurer as the travel insurance supervising entity as 100
set forth in subdivision (7) of subsection [5] 3 of this 101
section below; or 102
(c) Travel administrator; 103
[(2)] (9) "Offer and disseminate", prov ide general 104
information, including a description of the coverage and 105
price, as well as process the application, collect premiums, 106
and perform other nonlicensable activities permitted by the 107
state; 108
[(3)] (10) "Primary certificate holder", a person who 109
elects and purchases travel insurance under a group policy; 110
(11) "Primary policyholder", a person who elects and 111
purchases individual travel insurance; 112
(12) "Travel administrator", a person who directly or 113
indirectly underwrites; collec ts charges, collateral, or 114
premiums from; or adjusts and settles claims on residents of 115
this state in connection with travel insurance; except that 116
a person shall not be considered a travel administrator if 117
that person's only actions that would otherwi se cause the 118
person to be considered a travel administrator are among the 119
following: 120
(a) A person working for a travel administrator to the 121
extent that the person's activities are subject to the 122
supervision and control of the travel administrator ; 123
(b) An insurance producer selling insurance or engaged 124
in administrative and claims -related activities within the 125
scope of the producer's license; 126 SCS HCS HB 2168 31
(c) A travel retailer offering and disseminating 127
travel insurance and registered under the l icense of a 128
limited lines travel insurance producer in accordance with 129
this section; 130
(d) A person adjusting or settling claims in the 131
normal course of that person's practice or employment as an 132
attorney-at-law and who does not collect charges or premiums 133
in connection with insurance coverage; or 134
(e) A business entity that is affiliated with a 135
licensed insurer while acting as a travel administrator for 136
the direct and assumed insurance business of an affiliated 137
insurer; 138
(13) "Travel assistance services", noninsurance 139
services for which the consumer is not indemnified based on 140
a fortuitous event and in which providing the service does 141
not result in transfer or shifting of risk that would 142
constitute the business of insurance. The term "travel 143
assistance services" includes, but is not limited to: 144
security advisories, destination information, vaccination 145
and immunization information services, travel reservation 146
services, entertainment, activity and event planning, 147
translation assistance, emergency messaging, international 148
legal and medical referrals, medical case monitoring, 149
coordination of transportation arrangements, emergency cash 150
transfer assistance, medical prescription replacement 151
assistance, passport and travel documen t replacement 152
assistance, lost luggage assistance, concierge services, and 153
any other service that is furnished in connection with 154
planned travel. Travel assistance services are not 155
insurance and not related to insurance; 156 SCS HCS HB 2168 32
(14) "Travel insurance", insurance coverage for 157
personal risks incident to planned travel, including, but 158
not limited to: 159
(a) Interruption or cancellation of trip or event; 160
(b) Loss of baggage or personal effects; 161
(c) Damages to accommodations or rental vehicl es; [or] 162
(d) Sickness, accident, disability, or death occurring 163
during travel; 164
(e) Emergency evacuation; 165
(f) Repatriation of remains; or 166
(g) Any other contractual obligations to indemnify or 167
pay a specified amount to the traveler upon determinable 168
contingencies related to travel as approved by the director . 169
Travel insurance does not include major medical plans, which 170
provide comprehensive medical protection for travelers with 171
trips lasting six months or longer, including, for e xample, 172
those persons working overseas as expatriates or military 173
personnel being deployed , or any other product that requires 174
a specific insurance producer license ; 175
[(4)] (15) "Travel protection plans", plans that 176
provide one or more of the foll owing: 177
(a) Travel insurance; 178
(b) Travel assistance services; or 179
(c) Cancellation fee waivers; 180
(16) "Travel retailer", a business entity that makes, 181
arranges, or offers travel services and may offer and 182
disseminate travel insurance as a service to its customers 183
on behalf of and under the direction of a limited lines 184
travel insurance producer. 185
2. (1) The requirements of this section shall apply 186
to travel insurance that covers any resident of this state 187 SCS HCS HB 2168 33
and is sold, solicit ed, negotiated, or offered in this state 188
and policies and certificates that are delivered or issued 189
for delivery in this state. Except as expressly provided in 190
this section, the requirements of this section shall not 191
apply to cancellation fee waivers or travel assistance 192
services. 193
(2) All other applicable provisions of this state's 194
insurance laws shall continue to apply to travel insurance, 195
except that the specific provisions of this section shall 196
supersede any general provisions of law that would otherwise 197
be applicable to travel insurance. 198
3. Notwithstanding any other provision of law: 199
(1) The director may issue a limited lines travel 200
insurance producer license to a person or business entity 201
that has filed with the director an application for a 202
limited lines travel insurance producer license in a form 203
and manner prescribed by the director. A limited lines 204
travel insurance producer shall be licensed to sell, 205
solicit, or negotiate travel insurance through a licensed 206
insurer. No person shall act as a limited lines travel 207
insurance producer or travel retailer unless properly 208
licensed or registered, respectively; 209
(2) A travel retailer may offer and disseminate travel 210
insurance on behalf of and under the control of a l imited 211
lines travel insurance producer only if the following 212
conditions are met: 213
(a) The limited lines travel insurance producer or 214
travel retailer provides to purchasers of travel insurance: 215
a. A description of the material terms or the act ual 216
material terms of the insurance coverage; 217
b. A description of the process for filing a claim; 218 SCS HCS HB 2168 34
c. A description of the review or cancellation process 219
for the travel insurance policy; and 220
d. The identity and contact information of the insurer 221
and limited lines travel insurance producer; 222
(b) At the time of licensure, the limited lines travel 223
insurance producer shall establish and maintain a register 224
on a form prescribed by the director of each travel retailer 225
that offers travel insurance on the limited lines travel 226
insurance producer's behalf. The register shall be 227
maintained and updated annually by the limited lines travel 228
insurance producer and shall include the name, address, and 229
contact information of the travel retail er and an officer or 230
person who directs or controls the travel retailer's 231
operations, and the travel retailer's federal tax 232
identification number. The limited lines travel insurance 233
producer shall submit such register within thirty days upon 234
request by the department. The limited lines travel 235
insurance producer shall also certify that the travel 236
retailer [register] registered complies with 18 U.S.C. 237
1033. The grounds for suspension and revocation and the 238
penalties applicable to resident insuranc e producers under 239
sections 375.141 to 375.153 shall be applicable to the 240
limited lines travel insurance producers and travel 241
retailers; 242
(c) The limited lines travel insurance producer has 243
designated one of its employees who is a licensed individu al 244
producer as a person responsible for the business entity's 245
compliance with the travel insurance laws, rules, and 246
regulations of this state; 247
(d) The designated person under paragraph (c) of this 248
subdivision, president, secretary, treasurer, and any other 249
officer or person who directs or controls the limited lines 250 SCS HCS HB 2168 35
travel insurance producer's insurance operations complies 251
with the fingerprinting requirements applicable to insurance 252
producers in the resident state of the [business entity] 253
limited lines travel insurance producer ; 254
(e) The limited lines travel insurance producer has 255
paid all applicable insurance producer licensing fees as set 256
forth in applicable state law; 257
(f) The limited lines travel insurance producer 258
requires each employee and authorized representative of the 259
travel retailer whose duties include offering and 260
disseminating travel insurance to receive a program of 261
instruction or training, which may be subject to review by 262
the director. The training material sha ll, at a minimum, 263
contain instructions on the types of insurance offered, 264
ethical sales practices, and required disclosures to 265
prospective customers; 266
[(2)] (3) Any travel retailer offering or 267
disseminating travel insurance shall make available to 268
prospective purchasers brochures or other written materials 269
that have been approved by the travel insurer. Such 270
materials shall include information that, at a minimum, 271
shall: 272
(a) Provide the identity and contact information of 273
the insurer and the limited lines travel insurance producer; 274
(b) Explain that the purchase of travel insurance is 275
not required to purchase any other product or service from 276
the travel retailer; and 277
(c) Explain that an unlicensed travel retailer is 278
permitted to provide general information about the insurance 279
offered by the travel retailer, including a description of 280
the coverage and price, but is not qualified or authorized 281
to answer technical questions about the terms and conditions 282 SCS HCS HB 2168 36
of the insurance offe red by the travel retailer or to 283
evaluate the adequacy of the customer's existing insurance 284
coverage; 285
[(3)] (4) A travel retailer's employee or authorized 286
representative, who is not licensed as an insurance 287
producer, may not: 288
(a) Evaluate or interpret the technical terms, 289
benefits, and conditions of the offered travel insurance 290
coverage; 291
(b) Evaluate or provide advice concerning a 292
prospective purchaser's existing insurance coverage; or 293
(c) Hold themselves or itself out as a li censed 294
insurer, licensed producer, or insurance expert [.]; 295
[3. Notwithstanding any other provision of law, ] (5) 296
A travel retailer whose insurance -related activities, and 297
those of its employees and authorized representatives, are 298
limited to offering and disseminating travel insurance on 299
behalf of and under the direction of a limited lines travel 300
insurance producer meeting the conditions stated in this 301
section is authorized to do so and receive related 302
compensation, upon registration by the lim ited lines travel 303
insurance producer as described in paragraph (b) of 304
subdivision [(1)] (2) of this subsection [2 of this 305
section.]; 306
[4.] (6) Travel insurance may be provided under an 307
individual policy or under a group or [master] blanket 308
policy[.]; 309
[5.] (7) As the insurer designee, the limited lines 310
travel insurance producer is responsible for the acts of the 311
travel retailer and shall use reasonable means to ensure 312
compliance by the travel retailer with this section ; and 313 SCS HCS HB 2168 37
(8) Any person licensed in a major line of authority 314
as an insurance producer is authorized to sell, solicit, and 315
negotiate travel insurance. A property and casualty 316
insurance producer is not required to become appointed by an 317
insurer in order to sell, solicit , or negotiate travel 318
insurance. 319
4. (1) A travel insurer shall pay premium tax, as 320
provided in section 148.370, on travel insurance premiums 321
paid by any of the following: 322
(a) An individual primary policyholder who is a 323
resident of this sta te; 324
(b) A primary certificate holder who is a resident of 325
this state who elects coverage under a group travel 326
insurance policy; or 327
(c) A blanket travel insurance policyholder that is a 328
resident in this state or has its principal place of 329
business or the principal place of business of an affiliate 330
or subsidiary that has purchased blanket travel insurance in 331
this state for eligible blanket group members, subject to 332
any apportionment rules that apply to the insurer across 333
multiple taxing jurisdictions or that permit the insurer to 334
allocate premium on an apportioned basis in a reasonable and 335
equitable manner in those jurisdictions. 336
(2) A travel insurer shall: 337
(a) Document the state of residence or principal place 338
of business of the policyholder or certificate holder, as 339
required in subdivision (1) of this subsection; and 340
(b) Report as premium only the amount allocable to 341
travel insurance and not any amounts received for travel 342
assistance services or cancellation fee wai vers. 343 SCS HCS HB 2168 38
5. Travel protection plans may be offered for one 344
price for the combined features that the travel protection 345
plan offers in this state if: 346
(1) The travel protection plan clearly discloses to 347
the consumer, at or prior to the time of pur chase, that it 348
includes travel insurance, travel assistance services, and 349
cancellation fee waivers as applicable, and provides 350
information and an opportunity, at or prior to the time of 351
purchase, for the consumer to obtain additional information 352
regarding the features and pricing of each; 353
(2) The fulfillment materials describe and delineate 354
the travel insurance, travel assistance services, and 355
cancellation fee waivers in the travel protection plan; and 356
(3) The fulfillment materials includ e the travel 357
insurance disclosures and the contact information for 358
persons providing travel assistance services and 359
cancellation fee waivers, as applicable. 360
6. (1) Except as otherwise provided in this section, 361
all persons offering travel insuran ce to residents of this 362
state are subject to sections 375.930 to 375.948. If there 363
is a conflict between this section and other provisions of 364
chapters 361 to 385 regarding the sale and marketing of 365
travel insurance and travel protection plans, the pro visions 366
of this section shall control. 367
(2) Offering or selling a travel insurance policy that 368
could never result in payment of any claims for any insured 369
under the policy is an unfair trade practice under sections 370
375.930 to 375.948. 371
(3) (a) All documents provided to consumers prior to 372
the purchase of travel insurance, including but not limited 373
to sales materials, advertising materials, and marketing 374
materials, shall be consistent with the travel insurance 375 SCS HCS HB 2168 39
policy itself, including but n ot limited to forms, 376
endorsements, policies, rate filings, and certificates of 377
insurance. 378
(b) For travel insurance policies or certificates that 379
contain preexisting condition exclusions, information and an 380
opportunity to learn more about the pree xisting condition 381
exclusions shall be provided any time prior to the time of 382
purchase, and in the coverage's fulfillment materials. 383
(c) The fulfillment materials and the information 384
described in paragraph (a) of subdivision (2) of subsection 385
3 of this section shall be provided to a policyholder or 386
certificate holder as soon as practicable following the 387
purchase of a travel protection plan. Unless the insured 388
has either started a covered trip or filed a claim under the 389
travel insurance coverag e, a policyholder or certificate 390
holder may cancel a policy or certificate for a full refund 391
of the travel protection plan price from the date of 392
purchase of a travel protection plan until at least: 393
a. Fifteen days following the date of delivery o f the 394
travel protection plan's fulfillment materials by postal 395
mail; or 396
b. Ten days following the date of delivery of the 397
travel protection plan's fulfillment materials by means 398
other than postal mail. 399
For purposes of this paragraph, delivery mea ns handing 400
fulfillment materials to the policyholder or certificate 401
holder or sending fulfillment materials by postal mail or 402
electronic means to the policyholder or certificate holder. 403
(d) The company shall disclose in the policy 404
documentation and fulfillment materials whether the travel 405 SCS HCS HB 2168 40
insurance is primary or secondary to other applicable 406
coverage. 407
(e) Marketing travel insurance directly to a consumer 408
through an insurer's website or by others through an 409
aggregator site shall not be an unfair trade practice or 410
other violation of law if an accurate summary or short 411
description of coverage is provided on the web page and the 412
consumer has access to the full provisions of the policy 413
through electronic means. 414
(4) No person offering, soliciting, or negotiating 415
travel insurance or travel protection plans on an individual 416
or group basis shall do so by using negative option or opt - 417
out that would require a consumer to take an affirmative 418
action to deselect coverage, such as uncheckin g a box on an 419
electronic form, when the consumer purchases a trip. 420
(5) It shall be an unfair trade practice to market 421
blanket travel insurance coverage as free. 422
(6) Where a consumer's destination jurisdiction 423
requires insurance coverage, it shall not be an unfair trade 424
practice to require that a consumer choose between the 425
following options as a condition of purchasing a trip or 426
travel package: 427
(a) Purchasing the coverage required by the 428
destination jurisdiction through the travel r etailer or 429
limited lines travel insurance producer supplying the trip 430
or travel package; or 431
(b) Agreeing to obtain and provide proof of coverage 432
that meets the destination jurisdiction's requirements prior 433
to departure. 434
7. (1) Notwithstanding any other provisions of 435
chapters 361 to 385, no person shall act or represent 436 SCS HCS HB 2168 41
himself or herself as a travel administrator for travel 437
insurance in this state unless the person: 438
(a) Is a licensed property and casualty insurance 439
producer in this state for activities permitted under that 440
producer license; 441
(b) Holds a valid managing general agent license in 442
this state; or 443
(c) Holds a valid third-party administrator license in 444
this state. 445
(2) An insurer is responsible for the a cts of a travel 446
administrator administering travel insurance underwritten by 447
the insurer, and is responsible for ensuring that the travel 448
administrator maintains all books and records relevant to 449
the insurer to be made available by the travel administr ator 450
to the director upon request. 451
8. (1) Notwithstanding any other provision of 452
chapters 361 to 385, travel insurance shall be classified 453
and filed for purposes of rates and forms under an inland 454
marine line of insurance, except that travel ins urance that 455
provides coverage for sickness, accident, disability, or 456
death occurring during travel, either exclusively or in 457
conjunction with related coverages of emergency evacuation 458
or repatriation of remains or incidental limited property 459
and casualty benefits such as baggage or trip cancellation, 460
may be filed under either an accident and health line of 461
insurance or an inland marine line of insurance. 462
(2) Eligibility and underwriting standards for travel 463
insurance may be developed and provi ded based on travel 464
protection plans designed for individual or identified 465
marketing or distribution channels, provided those standards 466
also meet the state's underwriting standards for an inland 467
marine line of insurance. 468 SCS HCS HB 2168 42
[6.] 9. The limited lines travel insurance producer 469
and any travel retailer offering and disseminating travel 470
insurance under the limited lines travel insurance producer 471
license shall be subject to the provisions of chapters 374 472
and 375, except as provided for in this section. 473
[7.] 10. The director may promulgate rules to 474
effectuate this section. Any rule or portion of a rule, as 475
that term is defined in section 536.010, that is created 476
under the authority delegated in this section shall become 477
effective only if it co mplies with and is subject to all of 478
the provisions of chapter 536 and, if applicable, section 479
536.028. This section and chapter 536 are nonseverable and 480
if any of the powers vested with the general assembly 481
pursuant to chapter 536 to review, to delay the effective 482
date, or to disapprove and annul a rule are subsequently 483
held unconstitutional, then the grant of rulemaking 484
authority and any rule proposed or adopted after August 28, 485
2013, shall be invalid and void. 486
376.380. 1. The legal minimum standard for valuation 1
of policies and contracts and the reserves to be maintained 2
thereon shall be as follows: 3
(1) For those policies and contracts issued prior to 4
the operative date provided in subsection 20 of section 5
376.670: 6
(a) Except as otherwise provided in subdivision (3) of 7
this subsection, the legal minimum standard for valuation of 8
policies of life insurance or annuity contracts issued prior 9
to April 13, 1934, shall be the Actuaries' or Combined 10
Experience Table of Mortality, with interest at the rate of 11
five percent per annum for group annuity contracts and four 12
percent per annum for all other policies and contracts; and 13
for policies of life insurance and annuity contracts issued 14 SCS HCS HB 2168 43
on and after April 13, 193 4, such minimum standard shall be 15
the American Experience Table of Mortality with interest at 16
the rate of five percent per annum for group annuity 17
contracts and three and one -half percent per annum for all 18
other policies and contracts; 19
(b) The director may vary the legal minimum standards 20
of interest and mortality for annuity contracts and in 21
particular cases of invalid or substandard lives and other 22
extra hazards, and shall have the right and authority to 23
designate the legal minimum standard for valuation of total 24
and permanent disability benefits and additional accidental 25
death benefits; 26
(c) Policies issued by companies doing business in 27
this state may provide for not more than one year 28
preliminary term insurance by incorporating in the 29
provisions thereof, specifying the premium consideration to 30
be received, a clause plainly showing that the first year's 31
insurance under such policies is term insurance, purchased 32
by the whole or a part of the premium to be received during 33
the first policy year and shall be valued accordingly; 34
provided, that if the premium charged for term insurance 35
under a limited payment life preliminary term policy 36
providing for the payment of all premiums thereon in less 37
than twenty years from the date of t he policy, or under an 38
endowment preliminary term policy, exceeds that charged for 39
life insurance twenty payment life preliminary term policies 40
of the same company, the reserve thereon at the end of any 41
year, including the first, shall not be less than the 42
reserve on a twenty payment life preliminary term policy 43
issued in the same year and at the same age, together with 44
an amount which shall be equivalent to the accumulation of a 45
net level premium sufficient to provide for a pure endowment 46 SCS HCS HB 2168 44
at the end of the premium payment period equal to the 47
difference between the value at the end of such period of 48
such twenty payment life preliminary term policy and the 49
full reserve at such time of such a limited payment life or 50
endowment policy. The premium payment period is the period 51
during which premiums are concurrently payable under such 52
twenty payment life preliminary term policy and such limited 53
payment life or endowment policy; 54
(d) Reserves for all such policies and contracts may 55
be calculated, at the option of the company, according to 56
any standards which produce greater aggregate reserves for 57
all such policies and contracts than the minimum reserves 58
required by this subdivision. In the case of policy 59
obligations of an insolvent life in surance company assumed 60
or reinsured in bulk by an insurance company upon a basis 61
requiring a separate accounting of the business and assets 62
of such insolvent company and an application of any part of 63
the earnings therefrom upon obligations which are n ot 64
implicit in the original terms of the policies or contracts 65
assumed or reinsured, the director, in order to protect all 66
policyholders of the reinsuring company, including the 67
holders of all policies so assumed or reinsured, and to 68
safeguard the future solvency of such reinsuring company, 69
shall have the right and authority to designate standards of 70
valuation for such reinsured policies and contracts which 71
will produce greater aggregate reserves for all such 72
policies and contracts than the minimum reserves required by 73
this subdivision or the terms and provisions of the policies 74
and contracts so assumed or reinsured, and, in such event, 75
such reinsuring company shall not, thereafter, adopt any 76
lower standards of valuation without the approval of the 77
director. 78 SCS HCS HB 2168 45
(2) For those policies and contracts issued on or 79
after the operative date provided in subsection 20 of 80
section 376.670: 81
(a) Except as otherwise provided in subdivision (3) of 82
this subsection and subsection 2 of this section, the 83
minimum standard for the valuation of all such policies and 84
contracts shall be the commissioners reserve valuation 85
methods defined in paragraphs (b), (c), (d), (e), and (h) of 86
this subdivision, three and one -half percent interest on all 87
such policies and contracts except those contracts specified 88
in subparagraph c. of this paragraph which consist of 89
single premium annuity contracts and in subparagraph d. of 90
this paragraph which consists of group annuity contracts 91
where the interest rate shall be five percent, and except 92
policies and contracts, other than annuity and pure 93
endowment contracts, issued on or after September 28, 1975, 94
where the interest rate shall be four percent interest for 95
such policies issued prior to September 28, 1979, and four 96
and one-half percent interest for such policies issued on or 97
after September 28, 1979, and the following tables: 98
a. For all ordinary policies of life insurance issued 99
prior to the operative date provided in subsection 12 of 100
section 376.670 on the standard basis, excluding any 101
disability and accidental death benefits in such policies, 102
the Commissioners 1941 Standard Ordinary Mortality Table, 103
and for such policies issued on or after the operative date 104
provided in subsection 12 of section 3 76.670, and prior to 105
the operative date of subsection 14 of section 376.670, the 106
Commissioners 1958 Standard Ordinary Mortality Table; 107
provided that for any category of such policies issued on or 108
after September 28, 1979, on female risks all modified n et 109
premiums and present values referred to in this section may 110 SCS HCS HB 2168 46
be calculated according to an age not more than six years 111
younger than the actual age of the insured; and for such 112
policies issued on or after the operative date of subsection 113
14 of section 376.670: 114
(i) The Commissioners 1980 Standard Ordinary Mortality 115
Table; or 116
(ii) At the election of the company for any one or 117
more specified plans of life insurance, the Commissioners 118
1980 Standard Ordinary Mortality Table with Ten -Year Select 119
Mortality Factors; or 120
(iii) Any ordinary mortality table, adopted after 1980 121
by the NAIC, that is approved by regulation promulgated by 122
the director for use in determining the minimum standard of 123
valuation for such policies; 124
b. For all industrial life insurance policies issued 125
on the standard basis, excluding any disability and 126
accidental death benefits in such policies, the 1941 127
Standard Industrial Mortality Table for such policies issued 128
prior to the operative date of subsection 13 of section 129
376.670 and for such policies issued on or after such 130
operative date, the Commissioners 1961 Standard Industrial 131
Mortality Table or any industrial mortality table, adopted 132
after 1980 by the NAIC, that is approved by regulation 133
promulgated by the director for use in determining the 134
minimum standard of valuation for such policies; 135
c. For individual annuity and pure endowment 136
contracts, excluding any disability and accidental death 137
benefits in such policies, the 1937 Standard Annuity 138
Mortality Table or, at the option of the company, the 139
Annuity Mortality Table for 1949, Ultimate, or any 140
modification of either of these tables approved by the 141
director; 142 SCS HCS HB 2168 47
d. For group annuity and pure endowment contracts, 143
excluding any disability and accidental death benefits in 144
such policies, the Group Annuity Mortality Table for 1951, 145
any modification of such table approved by the director, or, 146
at the option of the company, any of the tables or 147
modifications of tables specified for individua l annuity and 148
pure endowment contracts; 149
e. For total and permanent disability benefits in or 150
supplementary to ordinary policies or contracts, for 151
policies or contracts issued on or after January 1, 1966, 152
the tables of period two disablement rates and the 1930 to 153
1950 termination rates of the 1952 disability study of the 154
Society of Actuaries, with due regard to the type of benefit 155
or any tables of disablement rates and termination rates, 156
adopted after 1980 by the NAIC, that are approved by 157
regulation promulgated by the director for use in 158
determining the minimum standard of valuation for such 159
policies; for policies or contracts issued on or after 160
January 1, 1961, and prior to January 1, 1966, either such 161
tables or at the option of the compa ny, the Class (3) 162
Disability Table (1926); and for policies issued prior to 163
January 1, 1961, the Class (3) Disability Table (1926). Any 164
such table shall, for active lives, be combined with a 165
mortality table permitted for calculating the reserves for 166
life insurance policies; 167
f. For accidental death benefits in or supplementary 168
to policies issued on or after January 1, 1966, the 1959 169
Accidental Death Benefits Table or any accidental death 170
benefits table, adopted after 1980 by the NAIC, that is 171
approved by regulation promulgated by the director for use 172
in determining the minimum standard of valuation for such 173
policies; for policies issued on or after January 1, 1961, 174 SCS HCS HB 2168 48
and prior to January 1, 1966, either such table or, at the 175
option of the company, the Inter-Company Double Indemnity 176
Mortality Table; and for policies issued prior to January 1, 177
1961, the Inter-Company Double Indemnity Mortality Table. 178
Either table shall be combined with a mortality table 179
permitted for calculating the reserv es for life insurance 180
policies; 181
g. For group life insurance, life insurance issued on 182
the substandard basis and other special benefits, such 183
tables as may be approved by the director; 184
(b) Except as otherwise provided in paragraphs (d), 185
(e), and (h) of this subdivision, reserves according to the 186
commissioners reserve valuation method, for the life 187
insurance and endowment benefits of policies providing for a 188
uniform amount of insurance and requiring the payment of 189
uniform premiums shall be the excess, if any, of the present 190
value, at the date of valuation, of such future guaranteed 191
benefits provided for by such policies, over the then 192
present value of any future modified net premiums therefor. 193
The modified net premiums for any such pol icy shall be such 194
uniform percentage of the respective contract premiums for 195
such benefits that the present value, at the date of issue 196
of the policy, of all such modified net premiums shall be 197
equal to the sum of the then present value of such benefit s 198
provided for by the policy and the excess of a. over b., as 199
follows: 200
a. A net level annual premium equal to the present 201
value, at the date of issue, of such benefits provided for 202
after the first policy year, divided by the present value, 203
at the date of issue, of an annuity of one per annum payable 204
on the first and each subsequent anniversary of such policy 205
on which a premium falls due; provided, however, that such 206 SCS HCS HB 2168 49
net level annual premium shall not exceed the net level 207
annual premium on the nineteen year premium whole life plan 208
for insurance of the same amount at an age one year higher 209
than the age at issue of such policy; 210
b. A net one year term premium for such benefit 211
provided for in the first policy year; provided, that for 212
any life insurance policy issued on or after January 1, 213
1986, for which the contract premium in the first policy 214
year exceeds that of the second year and for which no 215
comparable additional benefit is provided in the first year 216
for such excess and which pro vides an endowment benefit or a 217
cash surrender value or a combination thereof in an amount 218
greater than such excess premium, the reserve according to 219
the commissioners reserve valuation method as of any policy 220
anniversary occurring on or before the ass umed ending date 221
defined herein as the first policy anniversary on which the 222
sum of any endowment benefit and any cash surrender value 223
then available is greater than such excess premium shall, 224
except as otherwise provided in paragraph (h) of this 225
subdivision, be the greater of the reserve as of such policy 226
anniversary calculated as described in paragraph (b) of this 227
subdivision and the reserve as of such policy anniversary 228
calculated as described in paragraph (b) of this 229
subdivision, but with: 230
(i) The value defined in subparagraph a. of paragraph 231
(b) of this subdivision being reduced by fifteen percent of 232
the amount of such excess first year premium; 233
(ii) All present values of benefits and premiums being 234
determined without reference t o premiums or benefits 235
provided for by the policy after the assumed ending date; 236
(iii) The policy being assumed to mature on such date 237
as an endowment; and 238 SCS HCS HB 2168 50
(iv) The cash surrender value provided on such date 239
being considered as an endowment benefit. 240
In making the above comparison the mortality and interest 241
bases stated in paragraph (a) of this subdivision and 242
subsection 2 of this section shall be used; 243
(c) Reserves according to the commissioners reserve 244
valuation method for: 245
a. Life insurance policies providing for a varying 246
amount of insurance or requiring the payment of varying 247
premiums; 248
b. Group annuity and pure endowment contracts 249
purchased under a retirement plan or plan of deferred 250
compensation, established or ma intained by an employer 251
(including a partnership or sole proprietorship) or by an 252
employee organization, or by both, other than a plan 253
providing individual retirement accounts or individual 254
retirement annuities under Section 408 of the Internal 255
Revenue Code, as now or hereafter amended; 256
c. Disability and accidental death benefits in all 257
policies and contracts; and 258
d. All other benefits, except life insurance and 259
endowment benefits in life insurance policies and benefits 260
provided by all other annuity and pure endowment contracts, 261
shall be calculated by a method consistent with the 262
principles of paragraph (b) of this subdivision; 263
(d) Paragraph (e) of this subdivision shall apply to 264
all annuity and pure endowment contracts other tha n group 265
annuity and pure endowment contracts purchased under a 266
retirement plan or plan of deferred compensation, 267
established or maintained by an employer (including a 268
partnership or sole proprietorship), or by an employee 269 SCS HCS HB 2168 51
organization, or by both, oth er than a plan providing 270
individual retirement accounts or individual retirement 271
annuities under Section 408 of the Internal Revenue Code, as 272
now or hereafter amended; 273
(e) Reserves according to the commissioners annuity 274
reserve method for benefit s under annuity or pure endowment 275
contracts, excluding any disability and accidental death 276
benefits in such contracts, shall be the greatest of the 277
respective excesses of the present values, at the date of 278
valuation, of the future guaranteed benefits, including 279
guaranteed nonforfeiture benefits, provided for by such 280
contracts at the end of each respective contract year, over 281
the present value, at the date of valuation, of any future 282
valuation considerations derived from future gross 283
considerations, required by the terms of such contract, that 284
become payable prior to the end of such respective contract 285
year. The future guaranteed benefits shall be determined by 286
using the mortality table, if any, and the interest rate, or 287
rates, specified in such contracts for determining 288
guaranteed benefits. The valuation considerations are the 289
portions of the respective gross considerations applied 290
under the terms of such contracts to determine nonforfeiture 291
values; 292
(f) In no event shall a company's a ggregate reserves 293
for all life insurance policies, excluding disability and 294
accidental death benefits, be less than the aggregate 295
reserves calculated in accordance with the method set forth 296
in paragraphs (b), (c), (d), (e), (h) and (i) of this 297
subdivision and the mortality table or tables and rate or 298
rates of interest used in calculating nonforfeiture benefits 299
for such policies; 300 SCS HCS HB 2168 52
(g) In no event shall the aggregate reserves for all 301
policies, contracts and benefits be less than the aggregate 302
reserves determined by the qualified actuary to be necessary 303
to render the opinion required by subsections 4 and 5 of 304
this section; 305
(h) If in any contract year the gross premium charged 306
by any life insurance company on any policy or contract is 307
less than the valuation net premium for the policy or 308
contract calculated by the method used in calculating the 309
reserve thereon but using the minimum valuation standards of 310
mortality and rate of interest, the minimum reserve required 311
for such policy or co ntract shall be the greater of either 312
the reserve calculated according to the mortality table, 313
rate of interest, and method actually used for such policy 314
or contract, or the reserve calculated by the method 315
actually used for such policy or contract but using the 316
minimum valuation standards of mortality and rate of 317
interest and replacing the valuation net premium by the 318
actual gross premium in each contract year for which the 319
valuation net premium exceeds the actual gross premium. The 320
minimum valuation standards of mortality and rate of 321
interest referred to in this section are those standards 322
stated in paragraph (a) of this subdivision and subsection 2 323
of this section; provided, that for any life insurance 324
policy issued on or after January 1, 19 86, for which the 325
gross premium in the first policy year exceeds that of the 326
second year and for which no comparable additional benefit 327
is provided in the first year for such excess and which 328
provides an endowment benefit or a cash surrender value or a 329
combination thereof in an amount greater than such excess 330
premium, the foregoing provisions of this paragraph shall be 331
applied as if the method actually used in calculating the 332 SCS HCS HB 2168 53
reserve for such policy were the method described in 333
paragraph (b) of thi s subdivision. The minimum reserve at 334
each policy anniversary of such a policy shall be the 335
greater of the minimum reserve calculated in accordance with 336
paragraphs (b) and (c) of this subdivision and the minimum 337
reserve calculated in accordance with t his paragraph; 338
(i) In the case of any plan of life insurance which 339
provides for future premium determination, the amounts of 340
which are to be determined by the insurance company based on 341
then estimates of future experience, or in the case of any 342
plan of life insurance or annuity which is of such a nature 343
that the minimum reserves cannot be determined by the 344
methods described in paragraphs (b) to (e) of this 345
subdivision, and paragraph (h) of this subdivision, the 346
reserves which are held under an y such plan must: 347
a. Be appropriate in relation to the benefits and the 348
pattern of premiums for that plan; and 349
b. Be computed by a method which is consistent with 350
the principles of this section as determined by regulations 351
promulgated by the director. 352
(3) Except as provided in subsection 2 of this 353
section, the minimum standard for the valuation of all 354
individual annuity and pure endowment contracts issued on or 355
after the operative date of this subdivision, as defined 356
herein, and for all annuities and pure endowments purchased 357
on or after such operative date under group annuity and pure 358
endowment contracts, shall be the commissioners reserve 359
valuation methods defined in paragraphs (b), (c), (d), and 360
(e) of subdivision (2) of this subsection, and the following 361
tables and interest rates: 362
(a) For individual annuity and pure endowment 363
contracts issued prior to September 28, 1979, excluding any 364 SCS HCS HB 2168 54
disability and accidental death benefits in such contracts, 365
the 1971 Individual Ann uity Mortality Table, or any 366
modification of this table approved by the director, and six 367
percent interest for single premium immediate annuity 368
contracts, and four percent interest for all other 369
individual annuity and pure endowment contracts; 370
(b) For individual single premium immediate annuity 371
contracts issued on or after September 28, 1979, excluding 372
any disability and accidental death benefits in such 373
contracts, the 1971 Individual Annuity Mortality Table, or 374
any individual annuity mortalit y table adopted after 1980 by 375
the NAIC, that is approved by regulation promulgated by the 376
director for use in determining the minimum standard of 377
valuation for such contracts, or any modification of these 378
tables approved by the director, and seven and one-half 379
percent interest; 380
(c) For individual annuity and pure endowment 381
contracts issued on or after September 28, 1979, other than 382
single premium immediate annuity contracts, excluding any 383
disability and accidental death benefits in such contra cts, 384
the 1971 Individual Annuity Mortality Table, or any 385
individual annuity mortality table adopted after 1980 by the 386
NAIC, that is approved by regulation promulgated by the 387
director for use in determining the minimum standard of 388
valuation for such co ntracts, or any modification of these 389
tables approved by the director, and five and one -half 390
percent interest for single premium deferred annuity and 391
pure endowment contracts and four and one -half percent 392
interest for all other such individual annuity and pure 393
endowment contracts; 394
(d) For all annuities and pure endowments purchased 395
prior to September 28, 1979, under group annuity and pure 396 SCS HCS HB 2168 55
endowment contracts, excluding any disability and accidental 397
death benefits purchased under such contracts , the 1971 398
Group Annuity Mortality Table, or any modification of this 399
table approved by the director, and six percent interest; 400
(e) For all annuities and pure endowments purchased on 401
or after September 28, 1979, under group annuity and pure 402
endowment contracts, excluding any disability and accidental 403
death benefits purchased under such contracts, the 1971 404
Group Annuity Mortality Table, or any group annuity 405
mortality table adopted after 1980 by the NAIC, that is 406
approved by regulation promulgat ed by the director for use 407
in determining the minimum standard of valuation for such 408
annuities and pure endowments, or any modification of these 409
tables approved by the director, and seven and one -half 410
percent interest; 411
(f) On and after September 28, 1975, any company may 412
file with the director a written notice of its election to 413
comply with the provisions of this subdivision after a 414
specified date before January 1, 1980, which shall be the 415
operative date of this subdivision for such company, 416
provided a company may elect a different operative date for 417
individual annuity and pure endowment contracts from that 418
elected for group annuity and pure endowment contracts. If 419
a company makes no such election, the operative date of this 420
subdivision for such company shall be January 1, 1980. 421
2. (1) The calendar year statutory valuation interest 422
rates as defined in this subsection shall be the interest 423
rates used in determining the minimum standard for the 424
valuation of: 425
(a) All life insurance policies issued in a particular 426
calendar year, on or after the operative date of subsection 427
14 of section 376.670; 428 SCS HCS HB 2168 56
(b) All individual annuity and pure endowment 429
contracts issued in a particular calendar year on or after 430
January 1, 1983; 431
(c) All annuities and pure endowment contracts 432
purchased in a particular calendar year on or after January 433
1, 1983, under group annuity and pure endowment contracts; 434
and 435
(d) The net increase, if any, in a particular calendar 436
year after January 1, 1983, in amounts held under guaranteed 437
interest contracts. 438
(2) The calendar year statutory valuation interest 439
rates, I, shall be determined as follows and the results 440
rounded to the nearer one -quarter of one percent: 441
(a) For life insurance: 442
I =.03 + W (R1 -.03) + W/2 (R2 -.09); 443
(b) For single premium immediate annuities and for 444
annuity benefits involving life contingencies arising from 445
other annuities with cash settlement options and from 446
guaranteed interest contracts with c ash settlement options: 447
I =.03 + W (R -.03), where R1 is the lesser of R 448
and .09; R2 is the greater of R and .09; R is 449
the reference interest rate defined in this 450
subsection; and W is the weighting factor 451
defined in this subsection; 452
(c) For other annuities with cash settlement options 453
and guaranteed interest contracts with cash settlement 454
options, valued on an issue year basis, except as stated in 455
paragraph (b) of this subdivision, the formula for life 456
insurance stated in paragraph (a) of this subdivision shall 457
apply to annuities and guaranteed interest contracts with 458
guarantee durations in excess of ten years and the formula 459
for single premium immediate annuities stated in paragraph 460 SCS HCS HB 2168 57
(b) of this subdivision shall apply to annuities and 461
guaranteed interest contracts with guarantee durations of 462
ten years or less; 463
(d) For other annuities with no cash settlement 464
options and for guaranteed interest contracts with no cash 465
settlement options, the formula for single premium immediate 466
annuities stated in paragraph (b) of this subdivision shall 467
apply; 468
(e) For other annuities with cash settlement options 469
and guaranteed interest contracts with cash settlement 470
options, valued on a change in fund basis, the formula for 471
single premium immediate annuities stated in paragraph (b) 472
of this subdivision shall apply. If the calendar year 473
statutory valuation interest rate for any life insurance 474
policies issued in any calendar year determined without 475
reference to this sentence differs from t he corresponding 476
actual rate for similar policies issued in the immediately 477
preceding calendar year by less than one -half of one 478
percent, the calendar year statutory valuation interest rate 479
for such life insurance policies shall be equal to the 480
corresponding actual rate for the immediately preceding 481
calendar year. For purposes of applying the immediately 482
preceding sentence, the calendar year statutory valuation 483
interest rate for life insurance policies issued in a 484
calendar year shall be determined for 1980 (using the 485
reference interest rate defined for 1979) and shall be 486
determined for each subsequent calendar year regardless of 487
when subsection 14 of section 376.670 becomes operative. 488
(3) The weighting factors referred to in the formulas 489
stated in subdivision (2) of this subsection are given in 490
the following tables: 491
(a) Weighting factors for life insurance: 492 SCS HCS HB 2168 58
For life insurance, the guarantee duration is the maximum 500
number of years the life insurance can remain in force on a 501
basis guaranteed in the p olicy or under options to convert 502
to plans of life insurance with premium rates or 503
nonforfeiture values or both which are guaranteed in the 504
original policy; 505
(b) Weighting factor for single premium immediate 506
annuities and for annuity benefits invo lving life 507
contingencies arising from other annuities with cash 508
settlement options and guaranteed interest contracts with 509
cash settlement options: .80; 510
(c) Weighting factors for other annuities and for 511
guaranteed interest contracts, except as st ated in paragraph 512
(b) of this subdivision, shall be as specified in 513
subparagraphs a., b., and c. of this paragraph, according to 514
the rules and definitions in subparagraphs d., e., and f. of 515
this paragraph: 516
a. For annuities and guaranteed interest contracts 517
valued on an issue year basis: 518
493 Guarantee Weighting
494 Duration Factors
495 (Years)
496 10 or less .50
497
498
More than 10, but not more
than 20
.45
499 More than 20 .35
519 Guarantee Weighting Factor
520 Duration for Plan Type
521 (Years) A B C SCS HCS HB 2168 59
b. For annuities and guaranteed interest contracts 528
valued on a change in fund basis, the factors shown in 529
subparagraph a. of this paragraph increased by: 530
c. For annuities and guaranteed interest contracts 534
valued on an issue year basis (other than those with no cash 535
settlement options) which do not guarantee interest on 536
considerations received more than one year after issue or 537
purchase and for annuities and guaranteed interest contracts 538
valued on a change in fund basis which d o not guarantee 539
interest rates on considerations received more than twelve 540
months beyond the valuation date, the factors shown in 541
subparagraph a. of this paragraph or derived in subparagraph 542
b. of this paragraph increased by: 543
522 5 or less: .80 .60 .50
523
524
More than 5, but not more than
10:
.75 .60 .50
525
526
More than 10, but not more than
20:
.65 .50 .45
527 More than 20: .45 .35 .35
531 Plan Type
532 A B C
533 .15 .25 .05
544 Plan Type
545 A B C
546 .05 .05 .05 SCS HCS HB 2168 60
d. For other annuities with cash settlement options 547
and guaranteed interest contracts with cash settlement 548
options, the guarantee durat ion is the number of years for 549
which the contract guarantees interest rates in excess of 550
the calendar year statutory valuation interest rate for life 551
insurance policies with guarantee duration in excess of 552
twenty years. For other annuities with no cas h settlement 553
options and for guaranteed interest contracts with no cash 554
settlement options, the guarantee duration is the number of 555
years from the date of issue or date of purchase to the date 556
annuity benefits are scheduled to commence; 557
e. Plan type as used in subparagraphs a., b., and c. 558
of this paragraph is defined as follows: 559
Plan Type A: At any time policyholder may withdraw 560
funds only with an adjustment to reflect changes in interest 561
rates or asset values since receipt of the funds b y the 562
insurance company, or without such adjustment but in 563
installments over five years or more, or as an immediate 564
life annuity, or no withdrawal permitted; 565
Plan Type B: Before expiration of the interest rate 566
guarantee, policyholder may withdraw funds only with an 567
adjustment to reflect changes in interest rates or asset 568
values since receipt of the funds by the insurance company, 569
or without such adjustment but in installments over five 570
years or more, or no withdrawal permitted. At the end of 571
interest rate guarantee, funds may be withdrawn without such 572
adjustment in a single sum or installments over fewer than 573
five years; 574
Plan Type C: Policyholder may withdraw funds before 575
expiration of interest rate guarantee in a single sum or 576
installments over fewer than five years either without 577
adjustment to reflect changes in interest rates or asset 578 SCS HCS HB 2168 61
values since receipt of the funds by the insurance company, 579
or subject only to a fixed surrender charge stipulated in 580
the contract as a percenta ge of the fund; 581
f. A company may elect to value guaranteed interest 582
contracts with cash settlement options and annuities with 583
cash settlement options on either an issue year basis or on 584
a change in fund basis. Guaranteed interest contracts with 585
no cash settlement options and other annuities with no cash 586
settlement options must be valued on an issue year basis. 587
As used in this subsection an issue year basis of valuation 588
refers to a valuation basis under which the interest rate 589
used to determine the minimum valuation standard for the 590
entire duration of the annuity or guaranteed interest 591
contract is the calendar year valuation interest rate for 592
the year of issue or year of purchase of the annuity or 593
guaranteed interest contract, and the chan ge in fund basis 594
of valuation refers to a valuation basis under which the 595
interest rate used to determine the minimum valuation 596
standard applicable to each change in the fund held under 597
the annuity or guaranteed interest contract is the calendar 598
year valuation interest rate for the year of the change in 599
the fund. 600
(4) The "reference interest rate" referred to in 601
subdivision (2) of this subsection shall be defined as 602
follows: 603
(a) For all life insurance, the lesser of the average 604
over a period of thirty-six months and the average over a 605
period of twelve months, ending on June thirtieth of the 606
calendar year next preceding the year of issue, of the 607
Monthly Average of the Composite Yield on Seasoned Corporate 608
Bonds, as published by Moody's Investors Service, Inc.; 609 SCS HCS HB 2168 62
(b) For single premium immediate annuities and for 610
annuity benefits involving life contingencies arising from 611
other annuities with cash settlement options and guaranteed 612
interest contracts with cash settlement options, th e average 613
over a period of twelve months, ending on June thirtieth of 614
the calendar year of issue or purchase, of the Monthly 615
Average of the Composite Yield on Seasoned Corporate Bonds, 616
as published by Moody's Investors Service, Inc.; 617
(c) For other annuities with cash settlement options 618
and guaranteed interest contracts with cash settlement 619
options, valued on a year of issue basis, except as stated 620
in paragraph (b) of this subdivision, with guarantee 621
duration in excess of ten years, the lesser of the average 622
over a period of thirty -six months and the average over a 623
period of twelve months, ending on June thirtieth of the 624
calendar year of issue or purchase, of the Monthly Average 625
of the Composite Yield on Seasoned Corporate Bonds, as 626
published by Moody's Investors Service, Inc.; 627
(d) For other annuities with cash settlement options 628
and guaranteed interest contracts with cash settlement 629
options, valued on a year of issue basis, except as stated 630
in paragraph (b) of this subdivision, wit h guarantee 631
duration of ten years or less, the average over a period of 632
twelve months, ending on June thirtieth of the calendar year 633
of issue or purchase, of the Monthly Average of the 634
Composite Yield on Seasoned Corporate Bonds, as published by 635
Moody's Investors Service, Inc.; 636
(e) For other annuities with no cash settlement 637
options and for guaranteed interest contracts with no cash 638
settlement options, the average over a period of twelve 639
months, ending on June thirtieth of the calendar year of 640
issue or purchase, of the Monthly Average of the Composite 641 SCS HCS HB 2168 63
Yield on Seasoned Corporate Bonds, as published by Moody's 642
Investors Service, Inc.; 643
(f) For other annuities with cash settlement options 644
and guaranteed interest contracts with cash settl ement 645
options, valued on a change in fund basis, except as stated 646
in paragraph (b) of this subdivision, the average over a 647
period of twelve months, ending on June thirtieth of the 648
calendar year of the change in the fund, of the Monthly 649
Average of the Composite Yield on Seasoned Corporate Bonds, 650
as published by Moody's Investors Service, Inc. 651
(5) In the event that the Monthly Average of the 652
Composite Yield on Seasoned Corporate Bonds is no longer 653
published by Moody's Investors Service, Inc., or in the 654
event that the NAIC determines that the Monthly Average of 655
the Composite Yield on Seasoned Corporate Bonds as published 656
by Moody's Investors Service, Inc., is no longer appropriate 657
for the determination of the reference interest rate, then 658
an alternative method for determination of the reference 659
interest rate, which is adopted by the NAIC and approved by 660
regulation promulgated by the director, may be substituted. 661
3. For accident and health insurance contracts issued 662
on or after the operative date of the valuation manual, the 663
standard prescribed in the valuation manual is the minimum 664
standard of valuation required under subsection 2 of section 665
376.370. For disability, accident and sickness, and 666
accident and health insurance contract s issued on or after 667
the operative date provided in subsection 20 of section 668
376.670 and prior to the operative date of the valuation 669
manual, the minimum standard of valuation is the standard 670
adopted by the director by regulation. 671 SCS HCS HB 2168 64
4. (1) This subsection shall apply to actuarial 672
opinions of reserves prior to the date of the valuation 673
manual. 674
(2) Every life insurance company doing business in 675
this state shall annually submit the opinion of a qualified 676
actuary as to whether the reserves an d related actuarial 677
items held in support of the policies and contracts 678
specified by the director by regulation are computed 679
appropriately, are based on assumptions which satisfy 680
contractual provisions, are consistent with prior reported 681
amounts and comply with applicable laws of this state. The 682
director by regulation shall define the specifics of this 683
opinion and add any other items deemed to be necessary to 684
its scope. 685
(3) (a) Every life insurance company, except as 686
exempted by or pursuant to regulation, shall also annually 687
include in the opinion required by subdivision (2) of this 688
subsection, an opinion of the same qualified actuary as to 689
whether the reserves and related actuarial items held in 690
support of the policies and contracts spe cified by the 691
director by regulation, when considered in light of the 692
assets held by the company with respect to the reserves and 693
related actuarial items, including but not limited to the 694
investment earnings on the assets and the considerations 695
anticipated to be received and retained under the policies 696
and contracts, make adequate provision for the company's 697
obligations under the policies and contracts, including but 698
not limited to the benefits under and expenses associated 699
with the policies and co ntracts. 700
(b) The director may provide by regulation for a 701
transition period for establishing any higher reserves which 702 SCS HCS HB 2168 65
the qualified actuary may deem necessary in order to render 703
the opinion required by this subsection. 704
(4) Each opinion required by subdivision (3) of this 705
subsection shall be governed by the following provisions: 706
(a) A memorandum, in form and substance acceptable to 707
the director as specified by regulation, shall be prepared 708
to support each actuarial opinion; and 709
(b) If the insurance company fails to provide a 710
supporting memorandum at the request of the director within 711
a period specified by regulation or the director determines 712
that the supporting memorandum provided by the insurance 713
company fails to meet the standards prescribed by the 714
regulations or is otherwise unacceptable to the director, 715
the director may engage a qualified actuary at the expense 716
of the company to review the opinion and the basis for the 717
opinion and prepare such supporting memorandum a s is 718
required by the director. 719
(5) Every opinion required by this subsection shall be 720
governed by the following provisions: 721
(a) The opinion shall be submitted with the annual 722
statement reflecting the valuation of such reserve 723
liabilities for each year ending on or after December 31, 724
1993; 725
(b) The opinion shall apply to all business in force 726
including individual and group health insurance plans, in 727
form and substance acceptable to the director as specified 728
by regulation; 729
(c) The opinion shall be based on standards adopted 730
from time to time by the Actuarial Standards Board and on 731
such additional standards as the director may by regulation 732
prescribe; 733 SCS HCS HB 2168 66
(d) In the case of an opinion required to be submitted 734
by a foreign or alien company, the director may accept the 735
opinion filed by that company with the insurance supervisory 736
official of another state if the director determines that 737
the opinion reasonably meets the requirements applicable to 738
a company domiciled in this s tate; 739
(e) For the purposes of this section, "qualified 740
actuary" means a member in good standing of the American 741
Academy of Actuaries who meets the requirements set forth in 742
such regulations; 743
(f) Except in cases of fraud or willful misconduct , 744
the qualified actuary shall not be liable for damages to any 745
person, other than the insurance company and the director, 746
for any act, error, omission, decision or conduct with 747
respect to the actuary's opinion; 748
(g) Disciplinary action by the dire ctor against the 749
company or the qualified actuary shall be defined in 750
regulations by the director; and 751
(h) Any memorandum in support of the opinion, and any 752
other material provided by the company to the director in 753
connection therewith, shall be kept confidential by the 754
director and shall not be made public and shall not be 755
subject to subpoena, other than for the purpose of defending 756
an action seeking damages from any person by reason of any 757
action required by this section or by regulations 758
promulgated hereunder; except that the memorandum or other 759
material may otherwise be released by the director: 760
a. With the written consent of the company; or 761
b. To the American Academy of Actuaries upon request 762
stating that the memorandum or o ther material is required 763
for the purpose of professional disciplinary proceedings and 764
setting forth procedures satisfactory to the director for 765 SCS HCS HB 2168 67
preserving the confidentiality of the memorandum or other 766
material. 767
Once any portion of the confidential me morandum is cited by 768
the company in its marketing or is cited before any 769
governmental agency other than a state insurance department 770
or is released by the company to the news media, all 771
portions of the confidential memorandum shall be no longer 772
confidential. 773
5. (1) This subsection shall apply to actuarial 774
opinions of reserves after the operative date of the 775
valuation manual. 776
(2) Every company with outstanding life insurance 777
contracts, accident and health insurance contracts, or 778
deposit-type contracts in Missouri and subject to regulation 779
by the director shall annually submit the opinion of the 780
appointed actuary as to whether the reserves and related 781
actuarial items held in support of the policies and 782
contracts are computed appropria tely, are based on 783
assumptions that satisfy contractual provisions, are 784
consistent with prior reported amounts, and comply with 785
applicable Missouri law. The valuation manual shall 786
prescribe the specifics of such opinion, including any items 787
deemed to be necessary to its scope. 788
(3) Every company with outstanding life insurance 789
contracts, accident and health insurance contracts, or 790
deposit-type contracts in Missouri and subject to regulation 791
by the director, except as exempted in the valuation manual, 792
shall also annually include in the opinion required under 793
subdivision (2) of this subsection an opinion of the same 794
appointed actuary as to whether the reserves and related 795
actuarial items held in support of the policies and 796 SCS HCS HB 2168 68
contracts specified in the valuation manual, when considered 797
in light of the assets held by the company with respect to 798
the reserves and related actuarial items including, but not 799
limited to, the investment earnings on the assets and the 800
considerations anticipated to be received and retained under 801
the policies and contracts, make adequate provision for the 802
company's obligations under the policies and contracts 803
including, but not limited to, benefits under and expenses 804
associated with the policies and contracts. 805
(4) Each opinion required by subdivision (3) of this 806
subsection shall be governed by the following provisions: 807
(a) A memorandum, in form and substance as specified 808
in the valuation manual and acceptable to the director, 809
shall be prepared to suppo rt each actuarial opinion; and 810
(b) If the insurance company fails to provide a 811
supporting memorandum at the request of the director within 812
a period specified in the valuation manual or the director 813
determines that the supporting memorandum provide d by the 814
insurance company fails to meet the standards prescribed by 815
the valuation manual or is otherwise unacceptable to the 816
director, the director may engage a qualified actuary at the 817
expense of the company to review the opinion and the basis 818
for the opinion and prepare the supporting memorandum 819
required by the director. 820
(5) Every opinion required by this subsection shall be 821
governed by the following: 822
(a) The opinion shall be in form and substance as 823
specified in the valuation manual and acceptable to the 824
director; 825
(b) The opinion shall be submitted with the annual 826
statement reflecting the valuation of such reserve 827 SCS HCS HB 2168 69
liabilities for each year ending on or after the operative 828
date of the valuation manual; 829
(c) The opinion shall apply to all policies and 830
contracts subject to subdivision (3) of this subsection, 831
plus other actuarial liabilities as may be specified in the 832
valuation manual; 833
(d) The opinion shall be based on standards adopted 834
from time to time by the Act uarial Standards Board or its 835
successor, and on such additional standards as may be 836
prescribed in the valuation manual; 837
(e) In the case of an opinion required to be submitted 838
by a foreign or alien company, the director may accept the 839
opinion filed by such company with the insurance supervisory 840
official of another state if the director determines that 841
the opinion reasonably meets the requirements applicable to 842
a company domiciled in Missouri; 843
(f) Except in cases of fraud or willful miscond uct, 844
the appointed actuary shall not be liable for damages to any 845
person, other than the insurance company and the director, 846
for any act, error, omission, decision, or conduct with 847
respect to the appointed actuary's opinion; and 848
(g) Disciplinary action by the director against the 849
company or the appointed actuary shall be defined in 850
regulations by the director. 851
6. (1) For policies issued on or after the operative 852
date of the valuation manual, the standard prescribed in the 853
valuation manual is the minimum standard of valuation 854
required under subsection 2 of section 376.370, except as 855
provided under subdivision (5) or (7) of this subsection. 856
(2) The operative date of the valuation manual is 857
January first of the first calendar year following the first 858
July first as of which all of the following have occurred: 859 SCS HCS HB 2168 70
(a) The valuation manual has been adopted by the NAIC 860
by an affirmative vote of at least forty -two members or 861
three-fourths of the members voting, whichever is greater; 862
(b) The standard valuation law as amended by the NAIC 863
in 2009 or legislation including substantially similar terms 864
and provisions has been enacted by states representing 865
greater than seventy -five percent of the direct premiums 866
written as reported in the following annual statements 867
submitted for 2008: life, accident, and health annual 868
statements; health annual statements; or fraternal annual 869
statements; 870
(c) The standard valuation law as amended by the NAIC 871
in 2009 or legislation includi ng substantially similar terms 872
and provisions has been enacted by at least forty -two of the 873
following fifty-five jurisdictions: the fifty states of the 874
United States, American Samoa, the American Virgin Islands, 875
the District of Columbia, Guam, and Puer to Rico; and 876
(d) The valuation manual becomes effective under an 877
order of the director. 878
(3) Unless a change in the valuation manual specifies 879
a later effective date, changes to the valuation manual 880
shall be effective on January first followi ng the date when 881
all of the following have occurred: 882
(a) The change to the valuation manual has been 883
adopted by the NAIC by an affirmative vote representing: 884
a. At least three-fourths of the members of the NAIC 885
voting, but not less than a ma jority of the total 886
membership; and 887
b. Members of the NAIC representing jurisdictions 888
totaling greater than seventy -five percent of the direct 889
premiums written as reported in the following annual 890
statements most recently available prior to the vo te in 891 SCS HCS HB 2168 71
subparagraph a. of this paragraph: life, accident, and 892
health annual statements; health annual statements; or 893
fraternal annual statements; 894
(b) The valuation manual becomes effective under an 895
order of the director. 896
(4) The valuation manual shall specify all of the 897
following: 898
(a) Minimum valuation standards for and definitions of 899
the policies or contracts subject to subsection 2 of section 900
376.370. Such minimum standards shall be: 901
a. The commissioners reserve valuation m ethod for life 902
insurance contracts, other than annuity contracts, subject 903
to subsection 2 of section 376.370; 904
b. The commissioners annuity reserve valuation method 905
for annuity contracts subject to subsection 2 of section 906
376.370; and 907
c. Minimum reserves for all other policies and 908
contracts subject to subsection 2 of section 376.370; 909
(b) Which policies or contracts or types of policies 910
or contracts are subject to the requirements of a principle - 911
based valuation under subdivision (1) o f subsection 7 of 912
this section and the minimum valuation standards consistent 913
with such requirements; 914
(c) For policies and contracts subject to principle - 915
based valuation under subsection 7 of this section: 916
a. Requirements for the format of r eports to the 917
director under paragraph (c) of subdivision (2) of 918
subsection 7 of this section and which shall include 919
information necessary to determine if the valuation is 920
appropriate and in compliance with sections 376.365 to 921
376.380; 922 SCS HCS HB 2168 72
b. Assumptions which shall be prescribed for risks 923
over which the company does not have significant control or 924
influence; 925
c. Procedures for corporate governance and oversight 926
of the actuarial function, and a process for appropriate 927
waiver or modification of such procedures; 928
(d) For policies not subject to a principle -based 929
valuation under subsection 7 of this section, the minimum 930
valuation standard shall either: 931
a. Be consistent with the minimum standard of 932
valuation prior to the operative date of the valuation 933
manual; or 934
b. Develop reserves that quantify the benefits and 935
guarantees, and the funding, associated with the contracts 936
and their risks at a level of conservatism that reflects 937
conditions that include unfavorable events tha t have a 938
reasonable probability of occurring; 939
(e) Other requirements including, but not limited to, 940
those relating to reserve methods, models for measuring 941
risk, generation of economic scenarios, assumptions, 942
margins, use of company experience, r isk measurement, 943
disclosure, certifications, reports, actuarial opinions and 944
memorandums, transition rules, and internal controls; and 945
(f) The data and form of the data required under 946
subsection 8 of this section, to whom the data shall be 947
submitted, and may specify other requirements, including 948
data analyses and reporting of analyses. 949
(5) In the absence of a specific valuation requirement 950
or if a specific valuation requirement in the valuation 951
manual is not, in the opinion of the directo r, in compliance 952
with sections 376.365 to 376.380, the company shall, with 953 SCS HCS HB 2168 73
respect to such requirements, comply with minimum valuation 954
standards prescribed by the director by regulation. 955
(6) The director may engage a qualified actuary, at 956
the expense of the company, to perform an actuarial 957
examination of the company and opine on the appropriateness 958
of any reserve assumption or method used by the company, or 959
to review and opine on a company's compliance with any 960
requirement set forth in section s 376.365 to 376.380. The 961
director may rely upon the opinion regarding provisions 962
contained in sections 376.365 to 376.380 of a qualified 963
actuary engaged by the director of another state, district, 964
or territory of the United States. As used in this 965
subdivision, engage includes employment and contracting. 966
(7) The director may require a company to change any 967
assumption or method that in the opinion of the director is 968
necessary in order to comply with the requirements of the 969
valuation manual or sections 376.365 to 376.380, and the 970
company shall adjust the reserves as required by the 971
director. The director may take other disciplinary action 972
as permitted under chapter 354 and chapters 374 to 385. 973
7. (1) A company shall establish reserve s using a 974
principle-based valuation that meets the following 975
conditions for policies or contracts as specified in the 976
valuation manual: 977
(a) Quantify the benefits and guarantees, and the 978
funding, associated with the contracts and their risks at a 979
level of conservatism that reflects conditions that include 980
unfavorable events that have a reasonable probability of 981
occurring during the lifetime of the contracts. For 982
policies or contracts with significant tail risk, the 983
company's valuation shall r eflect conditions appropriately 984
adverse to quantify the tail risk; 985 SCS HCS HB 2168 74
(b) Incorporate assumptions, risk analysis methods, 986
and financial models and management techniques that are 987
consistent with, but not necessarily identical to, those 988
utilized within the company's overall risk assessment 989
process, while recognizing potential differences in 990
financial reporting structures and any prescribed 991
assumptions or methods; 992
(c) Incorporate assumptions that are derived in one of 993
the following manners: 994
a. The assumption is prescribed in the valuation 995
manual; or 996
b. For assumptions that are not prescribed, the 997
assumption shall: 998
(i) Be established utilizing the company's available 999
experience to the extent it is relevant and statistically 1000
credible; or 1001
(ii) To the extent that company data is not available, 1002
relevant, or statistically credible, be established 1003
utilizing other relevant statistically credible experience; 1004
(d) Provide margins for uncertainty, including adverse 1005
deviation and estimation error, such that the greater the 1006
uncertainty the larger the margin and resulting reserve. 1007
(2) A company using a principle -based valuation for 1008
one or more policies or contracts subject to this section as 1009
specified in the valuati on manual shall: 1010
(a) Establish procedures for corporate governance and 1011
oversight of the actuarial valuation function consistent 1012
with those described in the valuation manual; 1013
(b) Provide to the director an annual certification of 1014
the effectiveness of the internal controls with respect to 1015
the principle-based valuation. Such controls shall be 1016
designed to ensure that all material risks inherent in the 1017 SCS HCS HB 2168 75
liabilities and associated assets subject to such valuation 1018
are included in the valuation a nd that valuations are made 1019
in accordance with the valuation manual. The certification 1020
shall be based on the controls in place as of the end of the 1021
preceding calendar year; 1022
(c) Develop, and file with the director upon request, 1023
a principle-based valuation report that complies with 1024
standards prescribed in the valuation manual. 1025
(3) A principle-based valuation may include a 1026
prescribed formulaic reserve component. 1027
8. For policies in force on or after the operative 1028
date of the valuation manual, a company shall submit 1029
mortality, morbidity, policyholder behavior, or expense 1030
experience and other data as prescribed in the valuation 1031
manual. 1032
9. (1) For purposes of this subsection, "confidential 1033
information" means: 1034
(a) A memorandum in support of an opinion submitted 1035
under subsection 4 or 5 of this section and any other 1036
documents, materials, and other information including, but 1037
not limited to, all working papers and copies thereof 1038
created, produced, or obtained by or disclose d to the 1039
director or any other person in connection with such 1040
memorandum; 1041
(b) All documents, materials, and other information 1042
including, but not limited to, all working papers and copies 1043
thereof created, produced, or obtained by or disclosed to 1044
the director or any other person in the course of an 1045
examination made under subdivision (6) of subsection 6 of 1046
this section; provided, however, that if an examination 1047
report or other material prepared in connection with an 1048
examination made under sectio n 374.205 is not held as 1049 SCS HCS HB 2168 76
private and confidential information under section 374.205, 1050
an examination report or other material prepared in 1051
connection with an examination made under subdivision (6) of 1052
subsection 6 of this section shall not be confidential 1053
information to the same extent as if such examination report 1054
or other material had been prepared under section 374.205; 1055
(c) Any reports, documents, materials, and other 1056
information developed by a company in support of or in 1057
connection with an an nual certification by the company under 1058
paragraph (b) of subdivision (2) of subsection 7 of this 1059
section evaluating the effectiveness of the company's 1060
internal controls with respect to a principle -based 1061
valuation and any other documents, materials, and other 1062
information including, but not limited to, all working 1063
papers and copies thereof created, produced, or obtained by 1064
or disclosed to the director or any other person in 1065
connection with such reports, documents, material, and other 1066
information; 1067
(d) Any principle-based valuation report developed 1068
under paragraph (c) of subdivision (2) of subsection 7 of 1069
this section and any other documents, materials, and other 1070
information including, but not limited to, all working 1071
papers and copies thereof created, produced, or obtained by 1072
or disclosed to the director or any other person in 1073
connection with such report; and 1074
(e) Any documents, materials, data, and other 1075
information submitted by a company under subsection 8 of 1076
this section (collective ly, "experience data" ) and any 1077
other documents, materials, data, and other information 1078
including, but not limited to, all working papers and copies 1079
thereof created or produced in connection with such 1080
experience data, in each case that include any pote ntially 1081 SCS HCS HB 2168 77
company-identifying or personally identifiable information, 1082
that is provided to or obtained by the director (together 1083
with any "experience data", the "experience materials" ) and 1084
any other documents, materials, data, and other information 1085
including, but not limited to, all working papers and copies 1086
thereof created, produced, or obtained by or disclosed to 1087
the director or any other person in connection with such 1088
experience materials. 1089
(2) (a) Except as provided in this subsection, a 1090
company's confidential information is confidential by law 1091
and privileged, and shall not be subject to chapter 610, 1092
shall not be subject to subpoena, and shall not be subject 1093
to discovery or admissible in evidence in any private civil 1094
action; provided, ho wever, that the director is authorized 1095
to use the confidential information in the furtherance of 1096
any regulatory or legal action brought against the company 1097
as a part of the director's official duties. 1098
(b) Neither the director nor any person who re ceived 1099
confidential information while acting under the authority of 1100
the director shall be permitted or required to testify in 1101
any private civil action concerning any confidential 1102
information. 1103
(c) In order to assist in the performance of the 1104
director's duties, the director may share confidential 1105
information with: 1106
a. Other state, federal, and international regulatory 1107
agencies and with the NAIC and its affiliates and 1108
subsidiaries; and 1109
b. In the case of confidential information specifi ed 1110
in paragraphs (a) and (d) of subdivision (1) of this 1111
subsection only, the Actuarial Board for Counseling and 1112
Discipline or its successor upon request stating that the 1113 SCS HCS HB 2168 78
confidential information is required for the purpose of 1114
professional disciplinary proceedings and with state, 1115
federal, and international law enforcement officials. 1116
(d) The sharing of confidential information detailed 1117
in paragraph (c) of this subdivision shall be contingent on 1118
such recipient agreeing and having the legal author ity to 1119
agree to maintain the confidentiality and privileged status 1120
of such documents, materials, data, and other information in 1121
the same manner and to the same extent as required for the 1122
director. 1123
(e) The director may receive documents, materials , 1124
data, and other information, including otherwise 1125
confidential and privileged documents, materials, data, or 1126
information, from the NAIC and its affiliates and 1127
subsidiaries, from regulatory or law enforcement officials 1128
of other foreign or domestic jur isdictions, and from the 1129
Actuarial Board for Counseling and Discipline or its 1130
successor and shall maintain as confidential or privileged 1131
any document, material, data, or other information received 1132
with notice or the understanding that it is confidentia l or 1133
privileged under the laws of the jurisdiction that is the 1134
source of the document, material, or other information. 1135
(f) The director may enter into agreements governing 1136
sharing and use of information consistent with this 1137
subdivision. 1138
(g) No waiver of any applicable privilege or claim of 1139
confidentiality in the confidential information shall occur 1140
as a result of disclosure to the director under this section 1141
or as a result of sharing as authorized in paragraph (c) of 1142
this subdivision. 1143
(h) A privilege established under the law of any state 1144
or jurisdiction that is substantially similar to the 1145 SCS HCS HB 2168 79
privilege established under this subdivision shall be 1146
available and enforced in any proceeding in, and in any 1147
court of, Missouri. 1148
(i) In this subsection, regulatory agency, law 1149
enforcement agency, and the NAIC include, but are not 1150
limited to, their employees, agents, consultants and 1151
contractors. 1152
(3) Notwithstanding subdivision (2) of this 1153
subsection, any confidential informatio n specified in 1154
paragraphs (a) and (d) of subdivision (1) of this subsection: 1155
(a) May be subject to subpoena for the purpose of 1156
defending an action seeking damages from the appointed 1157
actuary submitting the related memorandum in support of an 1158
opinion submitted under subsection 4 or 5 of this section or 1159
principle-based valuation report developed under paragraph 1160
(c) of subdivision (2) of subsection 7 of this section by 1161
reason of an action required by sections 376.365 to 376.380 1162
or by regulations promulgated hereunder; 1163
(b) May otherwise be released by the director with the 1164
written consent of the company; and 1165
(c) Once any portion of a memorandum in support of an 1166
opinion submitted under subsection 4 or 5 of this section or 1167
a principle-based valuation report developed under paragraph 1168
(c) of subdivision (2) of subsection 7 of this section is 1169
cited by the company in its marketing, or is publicly 1170
volunteered to or before a governmental agency other than a 1171
state insurance department, or i s released by the company to 1172
the news media, all portions of such memorandum or report 1173
shall no longer be confidential. 1174
10. The director may exempt specific product forms or 1175
product lines of a domestic company that is licensed and 1176 SCS HCS HB 2168 80
doing business only in Missouri from the requirements of 1177
subsection 6 of this section provided: 1178
(1) The director has issued an exemption in writing to 1179
the company and has not subsequently revoked the exemption 1180
in writing; and 1181
(2) The company computes reser ves using assumptions 1182
and methods used prior to the operative date of the 1183
valuation manual in addition to any requirements established 1184
by the director and promulgated by regulation. 1185
For any company granted an exemption under this section, 1186
subsection 3 of section 376.370 and subsections 1 to 5 of 1187
this section shall be applicable. With respect to any 1188
company applying this exemption, any reference to subsection 1189
6 of this section found in subsection 3 of section 376.370 1190
and subsections 1 to 5 of this s ection shall not be 1191
applicable. 1192
[11. (1) A company that has less than three hundred 1193
million dollars of ordinary life premium and that is 1194
licensed and doing business in Missouri and that is subject 1195
to the requirements of subsections 6 and 7 of th is section 1196
may hold reserves based on the mortality tables and interest 1197
rates defined by the valuation manual for net premium 1198
reserves and using the methodology defined in the provisions 1199
of paragraphs (b) through (i) of subdivision (2) of 1200
subsection 1 of this section and subsection 3 of section 1201
376.370 as they apply to ordinary life insurance in lieu of 1202
the reserves required by subsections 6 and 7 of this 1203
section, provided that: 1204
(a) If the company is a member of a group of life 1205
insurers, the group has combined ordinary life premiums of 1206
less than six hundred million dollars; 1207 SCS HCS HB 2168 81
(b) The company reported total adjusted capital of at 1208
least four hundred fifty percent of authorized control level 1209
risk-based capital in the risk -based capital report for the 1210
prior calendar year; 1211
(c) The appointed actuary has provided an unqualified 1212
opinion on the reserves in accordance with subsections 4 and 1213
5 of this section for the prior calendar year; 1214
(d) The company has provided a certifi cation by a 1215
qualified actuary that any universal life policy with a 1216
secondary guarantee issued after the operative date of the 1217
valuation manual meets the definition of a nonmaterial 1218
secondary guarantee universal life product as defined in the 1219
valuation manual. 1220
(2) For purposes of subdivision (1) of this 1221
subsection, ordinary life premiums are measured as direct 1222
premium plus reinsurance assumed from an unaffiliated 1223
company, as reported in the prior calendar year annual 1224
statement. 1225
(3) A domestic company meeting all of the above 1226
conditions may file a statement prior to July first with the 1227
director certifying that these conditions are met for the 1228
current calendar year based on premiums and other values 1229
from the prior calendar year finan cial statements. The 1230
director may reject such statement prior to September first 1231
and require a company to comply with the valuation manual 1232
requirements for life insurance reserves. ] 1233
379.011. 1. As used in this section, the follow ing 1
terms mean: 2
(1) "Delivered by electronic means", includes delivery 3
to an electronic mail address at which a party has consented 4
to receive notices or documents, or posting on an electronic 5
network or site accessible via the internet, mobile 6 SCS HCS HB 2168 82
application, computer, mobile device, tablet, or any other 7
electronic device, together with a separate notice to a 8
party directed to the electronic mail address at which the 9
party has consented to receive notice of the posting; 10
(2) "Party", any recipient of any notice or document 11
required as part of an insurance transaction, including but 12
not limited to an applicant, an insured or a policyholder. 13
2. Subject to subsection 3 of this section, any notice 14
to a party or any other document requir ed under applicable 15
law in an insurance transaction or that is to serve as 16
evidence of insurance coverage may be delivered, stored, and 17
presented by electronic means so long as it meets the 18
requirements of sections 432.200 to 432.295. Delivery of a 19
notice or document in accordance with this subsection shall 20
be considered equivalent to any delivery method required 21
under applicable law, including delivery by first class 22
mail, first class mail postage prepaid, certified mail, or 23
certificate of mailin g. 24
3. A notice or document may be delivered by electronic 25
means by an insurer to a party under this [subsection] 26
section if: 27
(1) The party has affirmatively consented to that 28
method of delivery and has not withdrawn the consent; 29
(2) The party, before giving consent, is provided with 30
a clear and conspicuous statement informing the party of: 31
(a) Any right or option to have the notice or document 32
provided in paper or another nonelectronic form at no 33
additional cost; 34
(b) The right of the party to withdraw consent to have 35
a notice or document delivered by electronic means; 36
(c) Whether the party's consent applies only to the 37
particular transaction as to which the notice or document 38 SCS HCS HB 2168 83
must be given or to identified categor ies of notices or 39
documents that may be delivered by electronic means during 40
the course of the parties' relationship; 41
(d) The means, after consent is given, by which a 42
party may obtain a paper copy of a notice or document 43
delivered by electronic means at no additional cost; and 44
(e) The procedure a party must follow to withdraw 45
consent to have a notice or document delivered by electronic 46
means and to update information needed to contact the party 47
electronically; 48
(3) The party, before giving consent, is provided with 49
a statement of the hardware and software requirements for 50
access to and retention of a notice or document delivered by 51
electronic means and consents electronically, and confirms 52
consent electronically, in a manner that reasonably 53
demonstrates that the party can access information in the 54
electronic form that will be used for notices or documents 55
delivered by electronic means as to which the party has 56
given consent; and 57
(4) After consent of the party is given, t he insurer, 58
in the event a change in the hardware or software 59
requirements needed to access or retain a notice or document 60
delivered in electronic means creates a material risk that 61
the party will not be able to access or retain a subsequent 62
notice or document to which the consent applies: 63
(a) Provides the party with a statement of the revised 64
hardware and software requirements for access to and 65
retention of a notice or document delivered by electronic 66
means and of the right of the party to wi thdraw consent 67
pursuant to paragraph (b) of subdivision (2) of this 68
subsection; and 69
(b) Complies with subdivision (2) of this subsection. 70 SCS HCS HB 2168 84
4. Notwithstanding any other provisions of this 71
section, if a policy of insurance is purchased directly 72
through an insurer's website, portal, or application, and is 73
initially delivered by electronic means, a party's consent 74
to have all future notices and documents related to the 75
policy, or claims thereunder, delivered by electronic means 76
shall be presumed. Nothing in this subsection shall affect 77
the right of a party under this section to withdraw its 78
consent to have a notice or document delivered by electronic 79
means. 80
5. This section does not affect requirements relating 81
to content or timing o f any notice or document required 82
under applicable law. If any provision of applicable law 83
requiring a notice or document to be provided to a party 84
expressly requires verification or acknowledgment of receipt 85
of the notice or document, the notice or d ocument may be 86
delivered by electronic means only if the method used 87
provides for verification or acknowledgment of receipt. 88
Absent verification or acknowledgment of receipt of the 89
initial notice or document on the part of the party, the 90
insurer shall send two subsequent notices or documents at 91
intervals of five business days. The legal effectiveness, 92
validity, or enforceability of any contract or policy of 93
insurance executed by a party may not be made contingent 94
upon obtaining electronic consent or confirmation of consent 95
of the party in accordance with subdivision (3) of 96
subsection 3 of this section. 97
[5.] 6. A withdrawal of consent by a party does not 98
affect the legal effectiveness, validity, or enforceability 99
of a notice or document d elivered by electronic means to the 100
party before the withdrawal of consent is effective. A 101
withdrawal of consent by a party is effective within thirty 102 SCS HCS HB 2168 85
days after receipt of the withdrawal by the insurer. 103
Failure by an insurer to comply with subdivisi on (4) of 104
subsection 3 of this section may be treated, at the election 105
of the party, as a withdrawal of consent for purposes of 106
this section. 107
[6.] 7. This section does not apply to a notice or 108
document delivered by an insurer in an electronic for m 109
before August 28, 2013, to a party who, before that date, 110
has consented to receive notices or documents in an 111
electronic form otherwise allowed by law. If the consent of 112
a party to receive certain notices or documents in an 113
electronic form is on fi le with an insurer before August 28, 114
2013, and pursuant to this section, an insurer intends to 115
deliver additional notices or documents to such party in an 116
electronic form, then prior to delivering such additional 117
notices or documents electronically, th e insurer shall 118
notify the party of: 119
(1) The notices or documents that may be delivered by 120
electronic means under this section that were not previously 121
delivered electronically; and 122
(2) The party's right to withdraw consent to have 123
notices or documents delivered by electronic means. 124
[7.] 8. A party who does not consent to delivery of 125
notices or documents under subsection 3 of this section, or 126
who withdraws their consent, shall not be subject to any 127
additional fees or costs for havin g notices or documents 128
provided or made available to them in paper or another 129
nonelectronic form. 130
[8.] 9. If any provision of applicable law requires a 131
signature or notice or document to be notarized, 132
acknowledged, verified, or made under oath, t he requirement 133
is satisfied if the electronic signature of the person 134 SCS HCS HB 2168 86
authorized to perform those acts, together with all other 135
information required to be included by the provision, is 136
attached to or logically associated with the signature, 137
notice, or document. 138
[9.] 10. This section may not be construed to modify, 139
limit, or supercede the provisions of sections 354.442, 140
376.1450, or 432.200 to 432.295. The provisions of this 141
section shall apply to notices and documents issued by 142
insurers organized under this chapter or chapter 380 and to 143
notices and documents relating to life insurance products 144
issued by insurers organized under chapter 376. 145
[10.] 11. Nothing in this section shall prevent an 146
insurer from offering a discount to an insured who elects to 147
receive notices and documents electronically in accordance 148
with this section. 149
Section B. The repeal and reenactment of section 1
288.132 and the enactment of section 288.133 shall become 2
effective January 1, 2023. 3
Section C. The repeal and reenactment of sections 1
303.025 and 303.041 shall take effect on January 1, 2024. 2
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