Oklahoma 2022 Regular Session

Oklahoma Senate Bill SB887 Compare Versions

Version 1 (Old)

Version 2 (New)

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3		-	An Act
4		-	ENROLLED SENATE
	3	+	ENGR. H. A. to ENGR. S. B. NO. 887 Page 1 1
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	28	+	ENGROSSED HOUSE AMENDME NTS
	29	+	TO
	30	+	ENGROSSED SENATE BILL NO . 887 By: Quinn of the Senate
	31	+
	32	+	and
	33	+
	34	+	Sneed of the House
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	36	+
	37	+
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	40	+	An Act relating to insurance **** Biographical
	41	+	Affidavits; modifying time frame for Business
	42	+	Character Report **** Oklahoma Automobile Insurance
	43	+	Plan to issue certain policies **** acts by an
	44	+	insurer constituting unfair claim settlement
	45	+	practices ** licensing procedure ** Oklahoma
	46	+	Property and Casualty Insurance Guaranty Association
	47	+	**** Oklahoma Life and Health Insurance Guaranty
	48	+	Association **** Viatical Settlements Act of 2008
	49	+	** Insurance Commissioner to prescribe rules **
	50	+	home service contracts; modifying type of authorized
	51	+	financial security deposit **** grievance procedures
	52	+	**** applicants for licensure, property for
	53	+	employees, Advisory Board to the Insurance
	54	+	Commissioner, and the Oklahoma Small Employer Health
	55	+	Reinsurance Program; providing for codification; and
	56	+	declaring an emergency.
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	62	+	AMENDMENT NO. 1. Page 68, Line 20, after the "comma" and before the
	63	+	word "notice" insert the word "written"
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	66	+	AMENDMENT NO. 2. Page 68, Lines 21 -23, by deleting all language
	67	+	beginning with the word " to" on Line 21 through
	68	+	the word "policy" on Line 23, insert the following
	69	+	language:
	70	+
	71	+	"by the insured to the insurer that provided the
	72	+	coverage being canceled. The notice of
	73	+	cancellation shall provide the date of the
	74	+	cancellation of the policy and the insurer shall
	75	+
	76	+	ENGR. H. A. to ENGR. S. B. NO. 887 Page 2 1
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	101	+	reimburse the insured for any premiums paid for
	102	+	coverage beyond the date of cancellation of the
	103	+	policy"
	104	+
	105	+	and amend title to confor m
	106	+
	107	+	Passed the House of Representatives the 21st day of April, 2021.
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	112	+
	113	+	Presiding Officer of the House of
	114	+	Representatives
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	117	+	Passed the Senate the ____ day of __________, 2021.
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	123	+	Presiding Officer of the Senate
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	125	+
	126	+	ENGR. S. B. NO. 887 Page 1 1
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	151	+	ENGROSSED SENATE
5	152		BILL NO. 887 By: Quinn of the Senate
6	153
7	154		and
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9	156		Sneed of the House
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16	163		An Act relating to insurance; amending 36 O.S. 2011,
17		-	Section 615.2, which relates to Biographical
18		-	Affidavits; modifying time frame for Business
19		-	Character Report; amending 36 O.S. 2011, Section 638,
20		-	which relates to compliance relating to examinations;
21		-	updating statutory references; requiring insurer using
22		-	credit information to pro vide certain exceptions to
23		-	how credit information is used; specifying exceptions;
24		-	authorizing insurer to require certain information for
25		-	granting of exception; declaring insurer in compliance
26		-	with law in certain situation; construing provision;
27		-	requiring insurer to provide notice of exceptio ns;
28		-	amending 36 O.S. 2011, Section 996, which relates to
29		-	assigned risks; removing prohibition on disapproval of
30		-	certain market plans; authorizing the Oklahoma
31		-	Automobile Insurance Plan to issue certain policies;
32		-	declaring policies as proof of certain requi red
33		-	financial responsibility; prov iding for liability;
34		-	requiring filing of annual audited financial
35		-	statement; authorizing Commissioner to establish
36		-	necessary rules; amending 36 O.S. 2011, Section 1116,
37		-	as amended by Section 18, Chapter 45, O.S.L. 2012 (36
38		-	O.S. Supp. 2020, Section 1116), w hich relates to
39		-	penalties for failure to remit taxes; removing time
40		-	limits; specifying application of certain penalty;
41		-	amending 36 O.S. 2011, Section 1219, as amended by
42		-	Section 1 of Senate Bill 550 of the 1st Session of the
43		-	58th Oklahoma Legislature , which relates to claims
44		-	reimbursement or denial; modifying time and manner of
45		-	claim payment or denia l; amending 36 O.S. 2011,
46		-
47		-	ENR. S. B. NO. 887 Page 2
48		-	Section 1250.5, as last amended by Section 1 of
49		-	Enrolled House Bill 2678 of the 1st Session of the
50		-	58th Oklahoma Legislature (36 O.S. Supp. 2020, Section
51		-	1250.5), which relates to acts by an insurer
52		-	constituting unfair claim settleme nt practices;
53		-	authorizing certain method of payment; ame nding 36
54		-	O.S. 2011, Section 1250.7, as amended by Section 7,
55		-	Chapter 95, O.S.L. 2018 (36 O.S. Supp. 20 20, Section
56		-	1250.7), which relates to property and casualty
57		-	claims; modifying time for notice; ame nding 36 O.S.
58		-	2011, Section 1250.8, which relates to mot or vehicle
59		-	total loss or damage claim; providing for electronic
60		-	payment; amending 36 O.S. 2011, Sectio n 1435.20, as
61		-	last amended by Section 1, Chapter 263, O.S.L. 2019
62		-	(36 O.S. Supp. 2020, Section 143 5.20), which relates
63		-	to limited lines producers; updatin g language; adding
64		-	type of license limited lines producer may recei ve;
65		-	amending 36 O.S. 2011, Section 1445, which relates to
66		-	fiduciary capacity; authorizing electronic payments in
67		-	certain circumstance s; amending 36 O.S. 2011, Section
68		-	1450, as amended by Se ction 6, Chapter 294, O.S.L.
69		-	2019 (36 O.S. Supp. 2020, Section 1450 ), which relates
70		-	to licensing procedure; modifying time for certain
	164	+	Section 311.4, as amended by Section 1, Chapter 275,
	165	+	O.S.L. 2014 (36 O.S. Supp. 2020, Section 311.4),
	166	+	which relates to annual statements reporting mar ket
	167	+	conduct data of insurers; authorizing imposition of
	168	+	civil fine; amending 36 O.S. 2011, Section 615.2,
	169	+	which relates to Biographical Affidavits; modifying
	170	+	time frame for Business Character Report; amending 36
	171	+	O.S. 2011, Section 638, which relates to com pliance
	172	+	relating to examinations; updating statutory
	173	+	references; requiring insurer using credit
	174	+	information to provide certain exceptions to how
	175	+	credit information is used; specifying exceptions;
	176	+	authorizing insurer to require certain information
	177	+	for granting of exception; declaring insurer in
	178	+	compliance with law in certain situation; construing
	179	+	provision; requiring insurer to provide notice of
	180	+	exceptions; amending 36 O.S. 2011, Section 996, which
	181	+	relates to assigned risks; removing prohibition on
	182	+	disapproval of certain market plans; authorizing the
	183	+	Oklahoma Automobile Insurance Plan to issue certain
	184	+	policies; declaring policies as proof of certain
	185	+	required financial responsibility; providing for
	186	+	liability; requiring filing of annual audited
	187	+	financial statement; authorizing Commissioner to
	188	+	establish necessary rules; amending 36 O.S. 2011,
	189	+	Section 1116, as amended by Section 18, Chapter 45,
	190	+	O.S.L. 2012 (36 O.S. Supp. 2020, Section 1116), which
	191	+	relates to penalties for failure to remit taxes;
	192	+	removing time limits; specifying application of
	193	+	certain penalty; amending 36 O.S. 2011, Section 1219,
	194	+	which relates to claims reimbursement or denial;
	195	+	modifying time and manner of claim payment or denial;
	196	+	amending 36 O.S. 2011, Section 1250.5, as amended by
	197	+	Section 1, Chapter 105, O.S.L. 2012 (36 O.S. Supp.
	198	+
	199	+	ENGR. S. B. NO. 887 Page 2 1
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	224	+	2020, Section 1250.5), which relates to acts by an
	225	+	insurer constituting unfair claim settlement
	226	+	practices; authorizing certain method of payment;
	227	+	amending 36 O.S. 2011, Section 1250.7, as amended by
	228	+	Section 7, Chapter 95, O.S.L. 2018 (36 O.S. Supp.
	229	+	2020, Section 1250.7), which relates to property and
	230	+	casualty claims; modifying time for notice; amending
	231	+	36 O.S. 2011, Section 1250.8, which relates to motor
	232	+	vehicle total loss or damage claim; providing for
	233	+	electronic payment; amending 36 O.S. 2011, Section
	234	+	1435.20, as last amended by Section 1, Chapter 263,
	235	+	O.S.L. 2019 (36 O.S. Supp. 2020, Section 1435.20),
	236	+	which relates to limited lines producers; updating
	237	+	language; adding type of license limited lines
	238	+	producer may receive; a mending 36 O.S. 2011, Section
	239	+	1445, which relates to fiduciary capacity;
	240	+	authorizing electronic payments in certain
	241	+	circumstances; amending 36 O.S. 2011, Section 1450,
	242	+	as amended by Section 6, Chapter 294, O.S.L. 2019 (36
	243	+	O.S. Supp. 2020, Section 1450), wh ich relates to
	244	+	licensing procedure; modifying time for certain
71	245		notification; requiring background reports by certain
72	246		persons; amending 36 O.S. 2011, Sections 2004, 2006,
73		-	as amended by Section 1, Chapter 78, O.S.L. 2014, ~~2007~~
74		-	and 2008 (36 O.S. Supp. ~~20 20~~, ~~Section~~ 2006), ~~which~~
75		-	relate to the Oklahoma Property and Casualty ~~Insurance~~
76		-	Guaranty Association; modifying definition; ~~modifying~~
77		-	composition of Board of Directors; ~~modifying~~
78		-	obligations of certain insurers; specifying ~~entity~~
79		-	responsible for issuance ~~o f certain~~ policies; ~~adding~~
80		-	method of certain notification; authorizing ~~insurer~~
81		-	Board representative to designate alternate ~~member~~
82		-	with duties of insurer; removing authority of
	247	+	as amended by Section 1, Chapter 78, O.S.L. 2014,
	248	+	2007 and 2008 (36 O.S. Supp. 2020, S ection 2006),
	249	+	which relate to the Oklahoma Property and Casualty
	250	+	Insurance Guaranty Association; modifying definition;
	251	+	modifying composition of Board of Directors;
	252	+	modifying obligations of certain insurers; specifying
	253	+	entity responsible for issuance of cer tain policies;
	254	+	adding method of certain notification; authorizing
	255	+	insurer Board representative to designate alternate
	256	+	member with duties of insurer; removing authority of
83	257		Commissioner to appoint Board members in certain
84	258		circumstances; modifying duties of t he Association;
85	259		removing residency requirement for certain entities;
86	260		amending 36 O.S. 2011, Section 2023, as amended by
87	261		Section 2, Chapter 384, O.S.L. 2019 (36 O.S. Supp.
88	262		2020, Section 2023), which relates to the Oklahoma
89	263		Life and Health Insurance Guaranty Association;
90		-
91		-	ENR. S. B. NO. 887 Page 3
92		-	clarifying terms; amending 36 O.S. 2011, Section 3101,
93		-	which relates to definitions; modifying definition;
94		-	amending 36 O.S. Supp. 2011, Section 3105, which
95		-	relates to motor service club agents; updating
96		-	language; clarifying persons who m ay be appointed;
97		-	removing requirement of certa in notification;
98		-	modifying certain fee for producers; modifying length
99		-	Commissioner may suspend certain license; amending 36
100		-	O.S. 2011, Section 3108, which relates to
101		-	misrepresentation; updating language; amend ing 36 O.S.
102		-	2011, amending 36 O.S. 2011, Secti on 3639.1, as
103		-	amended by Section 11, Chapter 44, O.S.L. 2012 (36
104		-	O.S. Supp. 2020, Section 3639.1), which relates to
105		-	personal residential insura nce; requiring insured
106		-	provide certain notification for cancellatio n;
107		-	requiring insurer to reimburse certain prem iums;
108		-	amending 36 O.S. 2011, Sections 4030 and 4030.1, which
109		-	relate to paying premiums for single life policies and
	264	+	clarifying terms; amending 36 O.S. 2011, Section
	265	+	3101, which relates to definitions; modifying
	266	+	definition; amending 36 O.S. Supp. 2011, Section
	267	+	3105, which relates to motor service club agents;
	268	+	updating language; clarifying persons who may be
	269	+	appointed; removing requirement of certain
	270	+	notification; modifying certain fee for producers;
	271	+
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	297	+	modifying length Commissioner may suspend certain
	298	+	license; amending 36 O.S. 2011, Section 3108, which
	299	+	relates to misrepresentation; updating language;
	300	+	amending 36 O.S. 2011, Section 3639.1, as amended by
	301	+	Section 11, Chapter 44, O.S.L. 2012 (36 O.S. Supp.
	302	+	2020, Section 3639.1), which relates to personal
	303	+	residential insurance; requiring insured provide
	304	+	certain notification for cancellation; providing that
	305	+	insurer not liable after date of cancellation;
	306	+	amending 36 O.S. 2011, Sections 4030 and 4030.1,
	307	+	which relate to paying premiums for single life
	308	+	policies and payment of proceeds; amending 36 O.S.
	309	+	2011, Section 4055.7, which relates to the Viatical
	310	+	Settlements Act of 2008; amending 36 O.S. Section
	311	+	4055.9, which relates to viatical settlements;
	312	+	amending 36 O.S. 2011, Section 4103, which relates to
	313	+	schedule of premium rates; deleting exception;
	314	+	amending 36 O.S. 2011, Section 4112, which relates to
110	315		payment of proceeds; am ending 36 O.S. 2011, Section
111		-	4055.7, which relates to the Viatical Sett lements Act
112		-	of 2008; amending 36 O.S. Section 4055.9, which
113		-	relates to viatical settlements; amending 36 O.S.
114		-	2011, Section 4103, which relates to schedule of
115		-	premium rates; deleting except ion; amending 36 O.S.
116		-	2011, Section 4112, which relates to payment of
117		-	proceeds; amending 36 O.S. 2011, Section 60 60.11, as
118		-	amended by Section 2, Chapter 75, O.S.L. 2020 (36 O.S.
119		-	Supp. 2020, Section 6060.11), which relates to mental
120		-	health and substance use disorders; modifying certain
121		-	deadline for Commissioner reporting; amending 36 O.S.
122		-	2011, Section 6060.12, as ame nded by Section 3,
123		-	Chapter 75, O.S.L. 2020 (36 O.S. Supp. 2020, Section
124		-	6060.12), which relates to calculation of premium
125		-	costs; modifying pena lty determination; prohibiting
126		-	change of name of prepaid funeral be nefit permit
127		-	holder; requiring Insurance Commi ssioner approval;
128		-	providing for application for change of name;
129		-	authorizing waiver of approval requirement;
130		-	authorizing denial of change of nam e application;
131		-	providing for issuance of prepaid funeral benefit
132		-	permit with new name; authorizing Insurance
133		-	Commissioner to prescribe rules; amending 36 O.S.
134		-
135		-	ENR. S. B. NO. 887 Page 4
136		-	2011, Section 6216.1, which relates to payment of
137		-	claims to public adjuster; amending 36 O.S. 201 1,
138		-	Section 6217, as last amended by Section 14, Chapter
139		-	269, O.S.L. 2013 (36 O.S. Supp. 2020, Section 6217),
140		-	which relates to continuing education; eliminating
141		-	continuing education advisory committee; defining
142		-	term; providing for dormant captive insurance company
143		-	to apply for certificate of dormancy; listing
144		-	requirements for certain dormant captive insurance
145		-	companies; providing exceptions; requiring certain
146		-	application prior to issuing insurance policies;
147		-	providing for revocation of certificate of dormancy ;
148		-	providing for examination; authorizing the Insurance
149		-	Commissioner to promulgate rules; amending 36 O.S.
150		-	2011, Section 6552, which relates to definitions;
151		-	modifying definition; amending 36 O.S. 2011, Section
152		-	6753, as amended by Section 38, Chapter 150, O. S.L.
153		-	2012 (36 O.S. Supp. 2020, Secti on 6753), which relates
154		-	to home service contracts; modifying type of
155		-	authorized financial security deposit; amending 36
156		-	O.S. 2011, Section 6904, which relates to is suance of
157		-	certificates; modifying agency responsible for
158		-	determining certain compliance; rem oving duty and
159		-	notification requirements of State Commissioner of
160		-	Health; modifying time frame for issuance of
161		-	certificate; amending 36 O.S. 2011, Section 6907,
162		-	which relates to reasonable standards of quality care
163		-	and credentialing; modifying applicable a gency;
164		-	amending 36 O.S. 2011, S ection 6911, which relates to
	316	+	6060.11, as amended by Section 2, Chapter 75, O.S.L.
	317	+	2020 (36 O.S. Supp. 2020, Section 6060.11), which
	318	+	relates to mental health and substance use disorders;
	319	+	modifying certain deadline for Commissioner
	320	+	reporting; amending 36 O.S . 2011, Section 6060.12, as
	321	+	amended by Section 3, Chapter 75, O.S.L. 2020 (36
	322	+	O.S. Supp. 2020, Section 6060.12), which relates to
	323	+	calculation of premium costs; modifying penalty
	324	+	determination; prohibiting change of name of prepaid
	325	+	funeral benefit permit ho lder; requiring Insurance
	326	+	Commissioner approval; providing for application for
	327	+	change of name; authorizing waiver of approval
	328	+	requirement; authorizing denial of change of name
	329	+	application; providing for issuance of prepaid
	330	+	funeral benefit permit with new n ame; authorizing
	331	+	Insurance Commissioner to prescribe rules; amending
	332	+	36 O.S. 2011, Section 6216.1, which relates to
	333	+	payment of claims to public adjuster; amending 36
	334	+	O.S. 2011, Section 6217, as last amended by Section
	335	+	14, Chapter 269, O.S.L. 2013 (36 O.S. Supp. 2020,
	336	+	Section 6217), which relates to continuing education;
	337	+	eliminating continuing education advisory committee;
	338	+	defining term; providing for dormant captive
	339	+	insurance company to apply for certificate of
	340	+	dormancy; listing requirements for certain dor mant
	341	+	captive insurance companies; providing exceptions;
	342	+	requiring certain application prior to issuing
	343	+	insurance policies; providing for revocation of
	344	+
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	370	+	certificate of dormancy; providing for examination;
	371	+	authorizing the Insurance Commissioner to promulgate
	372	+	rules; amending 36 O.S. 2011, Section 6552, which
	373	+	relates to definitions; modifying definition;
	374	+	amending 36 O.S. 2011, Section 6753, as amended by
	375	+	Section 38, Chapter 150, O.S.L. 2012 (36 O.S. Supp.
	376	+	2020, Section 6753), which relates to home service
	377	+	contracts; modifying type of authorized financial
	378	+	security deposit; amending 36 O.S. 2011, Section
	379	+	6904, which relates to issuance of certificates;
	380	+	modifying agency responsible for determining certain
	381	+	compliance; removing duty and notification
	382	+	requirements of State Commissioner of Health;
	383	+	modifying time frame for issuance of certificate;
	384	+	amending 36 O.S. 2011, Section 6907, which relates to
	385	+	reasonable standards of quality care and
	386	+	credentialing; modifying applicable agency; amending
	387	+	36 O.S. 2011, Section 6911, wh ich relates to
165	388		grievance procedures; modifying responsible agency;
166	389		amending 36 O.S. 2011, Section 6919, which relates to
167	390		examination of affairs, programs, books and records;
168	391		amending 36 O.S. 2011, Section 6920, which relates to
169	392		suspension or revocation of a certificate of
170	393		authority; eliminating role of State Commissioner of
171	394		Health in certain hearings and determinations;
172	395		modifying conditions in which Commissioner may revoke
173	396		certain license; amending 36 O.S. 2011, Section 6929,
174	397		which relates to contracts with qualified persons;
175	398		repealing 36 O.S. 2011, Sections 1435.40, as amended
176	399		by Section 1, Chapter 23, O.S.L. 2016 (O.S. Supp.
177	400		2020, Section 1435.40), 1612.1, 6221, and 6522 which
178		-
179		-	ENR. S. B. NO. 887 Page 5
180	401		relate to applicants for licensure, property for
181	402		employees, Advisory Board to th e Insurance
182	403		Commissioner, and the Oklahoma Small Employer Health
183	404		Reinsurance Program; providing for codification; and
184	405		declaring an emergency.
185	406
186	407
187	408
188	409
189		-	~~SUBJECT: Insurance~~
	410	+
190	411
191	412		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
192	413
193		-	SECTION 1. AMENDATORY 36 O.S. 2011, Section 615.2, is
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	439	+	SECTION 1. AMENDATORY 36 O.S . 2011, Section 311.4, as
	440	+	amended by Section 1, Chapter 275, O.S.L. 2014 (36 O.S. Supp. 2020,
	441	+	Section 311.4), is amended to read as follows:
	442	+	Section 311.4. A. Insurers authorized to do business under the
	443	+	provisions of the Oklahoma Insurance Code shall an nually file with
	444	+	the Insurance Commissioner market conduct annual statements
	445	+	reporting market conduct data of insurers on the thirty -first day of
	446	+	December of the previous year. The statements shall report on the
	447	+	lines of insurance and be in such general f orm and context as
	448	+	approved by the National Association of Insurance Commissioners
	449	+	(NAIC), and as supplemented for additional information required by
	450	+	the Insurance Commissioner by rule. The statements shall be
	451	+	prepared in accordance with NAIC instructions , including any
	452	+	supplemental filings described in the NAIC instructions. If no
	453	+	forms or instructions are available from the National Association of
	454	+	Insurance Commissioners, the statements shall be in the form and
	455	+	pursuant to instructions as provided by th e Insurance Commissioner.
	456	+	Insurers not authorized by the Insurance Commissioner to provide the
	457	+	lines of insurance approved by the National Association or the
	458	+	Insurance Commissioner shall not be required to file market conduct
	459	+	annual statements. For good cause shown, the Insurance Commissioner
	460	+	may extend the time within which market conduct annual statements
	461	+	may be filed. The Insurance Commissioner may provide copies of
	462	+	market conduct annual statements, amendments, and addendums to such
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	489	+	statements and market conduct data taken from such statements to the
	490	+	National Association of Insurance Commissioners only if, prior to
	491	+	sharing of the market conduct annual statements, amendments,
	492	+	addendums to such statements or market conduct data taken from such
	493	+	statements, the National Association of Insurance Commissioners
	494	+	enters into a written agreement with the Insurance Commissioner to
	495	+	maintain the confidentiality of the shared information.
	496	+	B. The Insurance Commissioner may adopt rules implementing this
	497	+	section including rules that:
	498	+	1. Add lines of insurance to be reported in market conduct
	499	+	annual statements; and
	500	+	2. Require the filing of market conduct annual statements and
	501	+	any amendments and addendums to such statements with the National
	502	+	Association of Insurance Com missioners, and the payment of
	503	+	applicable filing fees required by the NAIC.
	504	+	C. Insurers shall pay a filing fee of Two Hundred Dollars
	505	+	($200.00) to the Insurance Commissioner for the filing of the market
	506	+	conduct annual statement.
	507	+	D. No waiver of an applic able privilege or claim of
	508	+	confidentiality in the documents, materials, or other information
	509	+	shall occur as a result of disclosure to the Insurance Commissioner
	510	+	or the Commissioner's designee under this section or as a result of
	511	+	sharing the documents, mate rials or other information as provided in
	512	+	this section.
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	539	+	E. Market conduct annual statements and any amendments and
	540	+	addendums to such statements, filed with the Insurance Commissioner
	541	+	pursuant to this section in electronic format or otherwise, shall be
	542	+	treated as working papers and documents as set out in subsection F
	543	+	of Section 309.4 of this title.
	544	+	F. The Insurance Commissioner may use market conduct annual
	545	+	statements or amendments or addendums to such statements to assist
	546	+	in determining whether a market conduct examination or investigation
	547	+	of an insurer should be conducted. For purposes of completing a
	548	+	market conduct examination of any company under Sections 309.1
	549	+	through 309.7 of this title, the Insurance Commissioner may, in the
	550	+	sole discretion of the Insurance Commissioner, use market conduct
	551	+	annual statements or amendments or addendums to such statements to
	552	+	assist in determining compliance with the laws of this state and
	553	+	rules adopted by the Insurance Commissioner.
	554	+	G. For any violation of this sectio n, the Insurance
	555	+	Commissioner may, after notice and opportunity for a hearing,
	556	+	subject an insurer to a civil penalty of up to One Thousand Dollars
	557	+	($1,000.00) for each occurrence. Such civil penalty may be enforced
	558	+	in the same manner in which civil judgme nts may be enforced.
	559	+	SECTION 2. AMENDATORY 36 O.S. 2011, Section 615.2, is
194	560		amended to read as follows:
195		-
196	561		Section 615.2. All domestic insurers and health maintenance
197	562		organizations are required to keep biographical information curren t.
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198	589		Domestic insurers and health maintenance organizations are required
199	590		to provide Biographical Affidavits within thirty (30) days of any
200	591		change in officers, directors, key management or any person
201	592		acquiring ten percent (10%) or more controlling interest i n a
202	593		domestic insurer. The information shall be on the National
203	594		Association of Insurance Commissioners (NAIC) UCAA Biographical
204	595		Affidavit Form. The Biographical Affidavit is to be certified by an
205	596		independent third party acceptable to the Insurance Commiss ioner
206	597		that has conducted a comprehensive review of the background of the
207	598		applicant and has indicated that the Biographical Affidavit has no
208	599		significantly inaccurate or conflicting information and is accepted
209	600		as the Business Character Report. As used in th is section,
210	601		"independent third party" is one that has no affiliation with the
211	602		applicant and is in the business of providing background checks or
212	603		investigations. The Business Character Report must be current and
213	604		shall not be older than one (1) year six (6) months.
214		-
215		-	SECTION 2. AMENDATORY 36 O.S. 2011, Section 638, is
	605	+	SECTION 3. AMENDATORY 36 O.S. 2011, Section 638, is
216	606		amended to read as follows:
217		-
218	607		Section 638. Every MEWA Multiple Employer Welfare Arrangement
219	608		shall comply with Articles 15 through 19 and Sections 308 309.1
220	609		through 310 309.7, 311.1 and 619 of Title 36 of the Oklahoma
221		-
222		-	ENR. S. B. NO. 887 Page 6
223	610		Statutes this title which pertain to examinations, deposits and
224	611		solvency regulation.
225	612
226		-	SECTION 3. NEW LAW A new section of law to be codified
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	638	+	SECTION 4. NEW LAW A new section of law to be codified
227	639		in the Oklahoma Statutes as Section 953.1 of Title 36, unless there
228	640		is created a duplication in numbering, reads as follows:
229		-
230	641		A. Notwithstanding any other law or regulation, an insurer that
231	642		uses credit information shall, upon written request from an
232	643		applicant for insurance coverage or an insured upon a form provided
233	644		by the Insurance Commissioner, provide reasonable exceptions to the
234	645		rate of the insurer, rating classifications, company or tier
235	646		placement or underwriting rules or guidelines for a consumer who has
236	647		experienced and whose credit information has been directly
237	648		influenced by any of the following events:
238		-
239	649		1. Catastrophic event declared by the federal or state
240	650		government;
241		-
242	651		2. Serious illness or injury, or serious illness or injury to
243	652		an immediate family member;
244		-
245	653		3. Death of an immediate family mem ber;
246		-
247	654		4. Divorce or involuntary interruption of legally owed alimony
248	655		or support payments;
249		-
250	656		5. Identity theft;
251		-
252	657		6. Temporary loss of employment for a period of three (3)
253	658		months or more, if it results from involuntary termination;
254		-
255	659		7. Military deployment ove rseas; and
256		-
257	660		8. Other events, as determined by the Insurance Commissioner.
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258	686
259	687		B. If an applicant or insured submits a request for an
260	688		exception as provided in subsection A of this section, an insurer
261	689		may, in its sole discretion:
262		-
263	690		1. Require the consumer to pro vide reasonable written and
264	691		independently verifiable documentation of the event;
265		-
266		-	ENR. S. B. NO. 887 Page 7
267		-
268	692		2. Require the consumer to demonstrate that the event had
269	693		direct and meaningful impact on the credit information of the
270	694		consumer;
271		-
272	695		3. Require the request be made no more than sixty (60) days
273	696		from the date of the application for insurance or the policy
274	697		renewal;
275		-
276	698		4. Grant an exception despite the consumer not providing the
277	699		initial request for an exception in writing; or
278		-
279	700		5. Grant an exception to requiring a written request where the
280	701		consumer asks for a consideration of repeated events or the insurer
281	702		has considered this event previously.
282		-
283	703		C. An insurer is in compliance with any other provision of law
284	704		or Insurance Department rule relating to underwriting, rating or
285	705		rate filing notwithstanding the granting an exception under this
286	706		section. Nothing in this section shall be construed to provide a
287	707		consumer or other insured with a cause of action that does not exist
288	708		in the absence of this section.
289		-
290	709		D. The insurer shall provide notice to consumers, either at the
291	710		time of acceptance of an insurance application or at policy renewal,
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292	737		that reasonable exceptions are available and information about how
293	738		the consumer may inquire further.
294		-
295		-	SECTION 4. AMENDATORY 36 O.S. 2011, Section 996, is
	739	+	SECTION 5. AMENDATORY 36 O.S. 2011, Section 996, is
296	740		amended to read as follows:
297		-
298	741		Section 996. Assigned Risks. A. Agreements may be made among
299	742		insurers with respect to the equitable apportionment among them of
300	743		costs for insurance which may be afforded applicants who are in good
301	744		faith entitled to, but who are unable to procure , such insurance
302	745		through ordinary methods, and such insurers may agree among
303	746		themselves on the use of reasonable rate modifications for such
304	747		insurance, such agreements and rate modifications to be subject to
305	748		the approval of the Insurance Commissioner. Nothing in the Property
306	749		and Casualty Competitive Loss Cost Rating Act shall permit
307	750		disapproval of a residual market plan permitting an insurer to elect
308	751		voluntary direct assignment .
309		-
310		-	ENR. S. B. NO. 887 Page 8
311		-
312	752		B. The Oklahoma Automobile Insurance Pla n is authorized to
313	753		issue policies of insurance in the name of the plan for the
314	754		applicants described in subsection A of this section and to act on
315	755		behalf of all participating members in connection with the policies.
316	756		The policies shall be considered proof o f financial responsibility
317	757		in accordance with Section 7 -600 of the Highway Safety Code.
318		-
319	758		C. The participating members shall be liable to the plan for
320	759		all costs, expenses and liabilities in proportion to its share of
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321	786		voluntary market premium for the types o f policies written under the
322	787		plan in this state.
323		-
324	788		D. The plan shall file an annual audited financial statement
325	789		with the Commissioner.
326		-
327	790		E. The Commissioner is authorized to establish rules and
328	791		regulations required to implement the purposes of this section.
329		-
330		-	SECTION 5. AMENDATORY 36 O.S. 2011, Section 1116, as
	792	+	SECTION 6. AMENDATORY 36 O.S. 2011, Section 1116, as
331	793		amended by Section 18, Chapter 45, O.S.L. 2012 (36 O.S. Supp. 2020,
332	794		Section 1116), is amended to read as follows:
333		-
334	795		Section 1116. A. Any surplus lines licensee or broker who
335	796		fails to remit the surplus line tax provided for by Section 1115 of
336	797		this title for more than sixty (60) days after it is due shall be
337	798		liable for a civil penalty of not to exceed Twenty -five Dollars
338	799		($25.00) for each additional day of delinquency, per policy. The
339	800		Insurance Commissioner shall collect the tax by distraint and shall
340	801		recover the penalty by an action in the name of the State of
341	802		Oklahoma. The Commissioner may request the Attorney General to
342	803		appear in the name of the state by relation of the Commiss ioner.
343		-
344	804		B. If any person, association or legal entity procuring or
345	805		accepting any insurance coverage from a surplus lines insurer where
346	806		Oklahoma is the home state of the insured, otherwise than through a
347	807		surplus lines licensee or broker, fails to remit the surplus line
348	808		tax provided for by Section 1115 of this title, the person,
349	809		association or legal entity shall, in addition to the tax, be liable
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350	836		to a civil penalty in an amount equal to one percent (1%) of the
351	837		premiums paid or agreed to be paid for the policy or policies of
352	838		insurance for each calendar month of delinquency or a civil penalty
353		-
354		-	ENR. S. B. NO. 887 Page 9
355	839		in the amount of Twenty -five Dollars ($25.00) whichever shall be the
356	840		greater. The Insurance Commissioner shall collect the tax by
357	841		distraint and shall recover the civil pen alty in an action in the
358	842		name of the State of Oklahoma. The Commissioner may request the
359	843		Attorney General to appear in the name of the state by relation of
360	844		the Commissioner.
361		-
362		-	SECTION 6. AMENDATORY 36 O.S. 2011, Section 1219, as
363		-	amended by Section 1 of Senate Bill 550 of the 1st Session of the
364		-	58th Oklahoma Legislature (36 O.S. Supp. 2020, Section 1219) , is
	845	+	SECTION 7. AMENDATORY 36 O.S. 2011, Section 1219, is
365	846		amended to read as follows:
366		-
367	847		Section 1219. A. In the administration, servicing, or
368	848		processing of any accident and health insurance policy, every
369	849		insurer shall reimburse all clean claims of an insured, an assignee
370	850		of the insured, or a health care provider wi thin forty-five (45)
371	851		calendar days after receipt of the a paper claim and thirty (30)
372	852		calendar days after receipt of an electronic claim by the insurer.
373		-
374	853		B. As used in this section:
375		-
376		-	1. “Accident and health insurance policy” or “policy” means any
	854	+	1. "Accident and health insurance policy" or "policy" means any
377	855		policy, certificate, contract, agreement or other instrument that
378	856		provides accident and health insurance, as defined in Section 703 of
379	857		this title, to any person in this state, and any subscriber
380	858		certificate or any evidence of coverage issued by a health
381	859		maintenance organization to any person in this state;
382	860
383		-	2. “Clean claim” means a claim that has no defect or
384		-	impropriety including a lack of any required substantiating
385		-	documentation or particular circumstance requiring special treatment
386		-	that impedes prompt payment; and
387		-
388		-	3. “Insurer” means any entity that provides an accident and
389		-	health insurance policy in this state including, but not limited to,
390		-	a licensed insurance company, a no t-for-profit hospital service and
391		-	medical indemnity corporation, a he alth maintenance organization, a
392		-	fraternal benefit society, a multiple employer welfare arran gement,
393		-	or any other entity subject to regula tion by the Insurance
394		-	Commissioner.
395		-
396		-
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	886	+	2. "Clean claim" means a claim that has no defect or
	887	+	impropriety, including a lack of any required substantiating
	888	+	documentation, or particular circumstance requiring special
	889	+	treatment that impedes prompt payment; and
	890	+	3. "Insurer" means any entity that provides an accident and
	891	+	health insurance policy in this state, including, but not limited
	892	+	to, a licensed insurance company, a not -for-profit hospital service
	893	+	and medical indemnity corporation, a health maintenance
	894	+	organization, a fraternal benefit society, a multiple employer
	895	+	welfare arrangement, or any other entity subject to regulation by
	896	+	the Insurance Commissioner.
398	897		C. If a claim or any portion of a claim is determined to have
399		-	defects or improprieties including a lack of any required
400		-	substantiating documentation or particular ~~circumsta nce~~ requiring
	898	+	defects or improprieties, including a lack of any required
	899	+	substantiating documentation, or particular circumstance requiring
401	900		special treatment, the insured , enrollee or subscriber, assignee of
402	901		the insured, enrollee or subscriber, and health care provider shall
403	902		be notified in writing within thirty (30) calendar days after
404	903		receipt of the claim by the insurer. The written notice shall
405	904		specify the portion of the claim that is causing a delay in
406	905		processing and explain any additional information or corrections
407	906		needed. Failure of an insurer to pr ovide the insured, enrollee or
408	907		subscriber, assignee of the insured, enrollee or subscriber, and
409	908		health care provider with the notice shall constitute prima facie
410	909		evidence that the claim will be paid in accordance with the terms of
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411	936		the policy. Provided, if a claim is not submitted into the system
412	937		due to a failure to meet basic Electronic Data Interchange (EDI)
413	938		and/or Health Insurance Portability and Accountability Act (HIPAA)
414	939		edits, electronic notification of the failure to the submitter shall
415	940		be deemed compliance with this subsection. Provided further, health
416	941		maintenance organizations shall not be required to notify the
417	942		insured, enrollee or subscriber, or assignee of the insured,
418	943		enrollee or subscriber of any claim defect or impropriety.
419		-
420		-	Upon receipt of the additional information or corrections which
421		-	led to the claim’s being delayed and a determination that the
	944	+	D. Upon receipt of the additional information or corrections
	945	+	which led to the claim's being delayed and a determination that the
422	946		information is accurate, an insurer shall either pay or deny the
423	947		claim or a portion of the claim within forty -five (45) calendar days
424	948		for a paper claim and thirty (30) calendar days for an electronic
425	949		claim.
426		-
427		-	D. If a clean claim or any portion of a clean claim is denied
428		-	for any reason, the insured, enrollee or subscriber, assignee of the
429		-	insured, enrollee or subsc riber, and health care provider shall be
430		-	notified in writing within thirty (30) calendar d ays after receipt
431		-	of the claim by the insurer. The written notice shall specify in
432		-	detail the reason for the denial including instructions on where a
433		-	person or entity that received notification may respond through
434		-	dedicated facsimile or electronic mail me ssage or the address or
435		-	electronic mail message address of the department of appeals of the
436		-	insurer. Upon receiving written notice of denial, a recipient may
437		-	submit a detailed app eal in writing explaining why the claim should
438		-	be approved. If the insurer denies the appeal, the insurer shall
439		-	address in writing the specific details included in the written
440		-
441		-	ENR. S. B. NO. 887 Page 11
442		-	appeal and provide the phone number of a health plan representative
443		-	at the department of appeals of the insurer .
444		-
445	950		E. Payment shall be considered made on:
446		-
447	951		1. The date a draft or other valid instrument which is
448	952		equivalent to the amount of the payment is placed in the United
449	953		States mail in a properly addres sed, postpaid envelope; or
450		-
451	954		2. If not so posted, the date of delivery.
452		-
453	955		F. An overdue payment shall bear simple interest at the rate of
454	956		ten percent (10%) per year.
455		-
456	957		G. In the event litigation should ensue based upon such a
457	958		claim, the prevailing party shall be entitled to recover a
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458	985		reasonable attorney fee to be set by the court and taxed as costs
459	986		against the party or parties who do not prevail.
460		-
461	987		H. The Insurance Commissioner shall develop a standardized
462	988		prompt pay form for use by providers in reporting viola tions of
463	989		prompt pay requirements. The form shall include a requirement that
464	990		documentation of the reason for the delay in payment or
465	991		documentation of proof of payment must be provided within ten (10)
466	992		days of the filing of the form. The Commissioner shall provide the
467	993		form to health maintenance organizations and providers.
468		-
469	994		I. The provisions of this section shall not apply to the
470	995		Oklahoma Life and Health Insurance Guaranty Association or to the
471	996		Oklahoma Property and Casualty Insurance Guaranty Association.
472		-
473		-	SECTION 7. AMENDATORY 36 O.S. 2011, Section 1250.5, as
474		-	last amended by Section 1 of Enrolled House Bill 2678 of the 1st
475		-	Session of the 58th Oklahoma Legislature (36 O.S. Supp. 2020,
	997	+	SECTION 8. AMENDATORY 36 O.S. 2011, Section 1250.5, as
	998	+	amended by Section 1, Chapter 105, O.S.L. 2012 (36 O.S. Supp. 2020,
476	999		Section 1250.5), is amended to read as follows:
477		-
478	1000		Section 1250.5. Any of the following acts by an insurer, if
479	1001		committed in violation of Section 1250.3 of this title, constitutes
480	1002		an unfair claim settlement practice exclusive of paragraph 16 of
481	1003		this section which shall be applicable solely to health benefit
482	1004		plans:
483		-
484		-
485		-	ENR. S. B. NO. 887 Page 12
486	1005		1. Failing to fully disclose to first party claima nts,
487	1006		benefits, coverages, or other provisions of any insurance policy or
488	1007		insurance contract when the benefits, coverages or other provisions
489	1008		are pertinent to a claim;
490	1009
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491	1035		2. Knowingly misrepresenting to claimants pertinent facts or
492	1036		policy provisions relating to coverages at issue;
493		-
494	1037		3. Failing to adopt and implement reasonable standards for
495	1038		prompt investigations of claims arising under its insurance policies
496	1039		or insurance contracts;
497		-
498	1040		4. Not attempting in good faith to effectuate prompt, fair and
499	1041		equitable settlement of claims submitted in which liability has
500	1042		become reasonably clear;
501		-
502	1043		5. Failing to comply with the provisions of Section 1219 of
503	1044		this title;
504		-
505	1045		6. Denying a claim for failure to exhibit the property without
506	1046		proof of demand and unfounded refusal by a cla imant to do so;
507		-
508	1047		7. Except where there is a time limit specified in the policy,
509	1048		making statements, written or otherwise, which require a claimant to
510	1049		give written notice of loss or proof of loss within a specified time
511	1050		limit and which seek to relieve the co mpany of its obligations if
512	1051		the time limit is not complied with unless the failure to comply
513	1052		with the time limit prejudices the rights of an insurer;
514		-
515	1053		8. Requesting a claimant to sign a release that extends beyond
516	1054		the subject matter that gave rise to the c laim payment;
517		-
518	1055		9. Issuing checks or, drafts or electronic payment in partial
519	1056		settlement of a loss or claim under a specified coverage which
520	1057		contain language releasing an insurer or its insured from its total
521	1058		liability;
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522	1084
523	1085		10. Denying payment to a claimant on the grounds that services,
524	1086		procedures, or supplies provided by a treating physician or a
525	1087		hospital were not medically necessary unless the health insurer or
526	1088		administrator, as defined in Section 1442 of this title, first
527	1089		obtains an opinion from any provider of health care licensed by law
528		-
529		-	ENR. S. B. NO. 887 Page 13
530	1090		and preceded by a medical examination or claim review, to the effect
531	1091		that the services, procedures or supplies for which payment is being
532	1092		denied were not medically necessary. Upon written request of a
533	1093		claimant, treating phy sician, or hospital, the opinion shall be set
534	1094		forth in a written report, prepared and signed by the reviewing
535	1095		physician. The report shall detail which specific services,
536	1096		procedures, or supplies were not medically necessary, in the opinion
537	1097		of the reviewing physician, and an explanation of that conclusion.
538	1098		A copy of each report of a reviewing physician shall be mailed by
539	1099		the health insurer, or administrator, postage prepaid, to the
540	1100		claimant, treating physician or hospital requesting same within
541	1101		fifteen (15) days after receipt of the written request. As used in
542	1102		this paragraph, "physician" means a person holding a valid license
543	1103		to practice medicine and surgery, osteopathic medicine, podiatric
544	1104		medicine, dentistry, chiropractic, or optometry, pursuant to the
545	1105		state licensing provisions of Title 59 of the Oklahoma Statutes;
546		-
547	1106		11. Compensating a reviewing physician, as defined in paragraph
548		-	10 of this ~~section~~, on the basis of a percentage of the amount by
	1107	+	10 of this subsection, on the basis of a percentage of the amount by
549	1108		which a claim is reduced for payment;
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550	1134
551	1135		12. Violating the pr ovisions of the Health Care Fraud
552	1136		Prevention Act;
553		-
554	1137		13. Compelling, without just cause, policyholders to institute
555	1138		suits to recover amounts due under its insurance policies or
556	1139		insurance contracts by offering substantially less than the amounts
557	1140		ultimately recovered in suits brought by them, when the
558	1141		policyholders have made claims for amounts reasonably similar to the
559	1142		amounts ultimately recovered;
560		-
561	1143		14. Failing to maintain a complete record of all complaints
562	1144		which it has received during the preceding three (3) years or since
563	1145		the date of its last financial examination conducted or accepted by
564	1146		the Commissioner, whichever time is longer. This record shall
565	1147		indicate the total number of complaints, their classification by
566	1148		line of insurance, the nature of each complai nt, the disposition of
567	1149		each complaint, and the time it took to process each complaint. For
568	1150		the purposes of this paragraph, "complaint" means any written
569	1151		communication primarily expressing a grievance;
570		-
571		-
572		-	ENR. S. B. NO. 887 Page 14
573	1152		15. Requesting a refund of all or a portion of a paym ent of a
574	1153		claim made to a claimant or health care provider more than twenty -
575	1154		four (24) months after the payment is made. This paragraph shall
576	1155		not apply:
577		-
578	1156		a. if the payment was made because of fraud committed by
579	1157		the claimant or health care provider, or
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580	1183
581	1184		b. if the claimant or health care provider has otherwise
582	1185		agreed to make a refund to the insurer for overpayment
583	1186		of a claim;
584		-
585	1187		16. Failing to pay, or requesting a refund of a payment, for
586	1188		health care services covered under the policy if a health benefit
587	1189		plan, or its agent, has provided a preauthorization or
588	1190		precertification and verification of eligibility for those health
589	1191		care services. This paragraph shall not apply if:
590		-
591	1192		a. the claim or payment was made because of fraud
592	1193		committed by the claimant or health care pro vider,
593		-
594	1194		b. the subscriber had a preexisting exclusion under the
595	1195		policy related to the service provided, or
596		-
597	1196		c. the subscriber or employer failed to pay the
598	1197		applicable premium and all grace periods and
599		-	extensions of coverage have expired;
600		-
	1198	+	extensions of coverage have expired; or
601	1199		17. Denying or refusing to accept an application for life
602	1200		insurance, or refusing to renew, cancel, restrict or otherwise
603	1201		terminate a policy of life insurance, or charge a different rate
604	1202		based upon the lawful travel destination of an applicant or insured
605		-	as provided in Section 4024 of this title ; or
606		-
607		-	18. As a health insurer that provides pharmacy benefits or a
608		-	pharmacy benefits manager that administers phar macy benefits for a
609		-	health plan, failing to include any amount pa id by an enrollee or on
610		-	behalf of an enrollee by another person when calculating the
611		-	enrollee's total contribution to an out -of-pocket maximum,
612		-	deductible, copayment, coinsurance or other cos t-sharing
613		-	requirement.
614		-
615		-
616		-	ENR. S. B. NO. 887 Page 15
617		-	SECTION 8. AMENDATORY 36 O.S. 2011, Section 1250.7, as
	1203	+	as provided in Section 4024 of this title.
	1204	+	SECTION 9. AMENDATORY 36 O.S. 2011, Section 1250.7, as
618	1205		amended by Section 7, Chapter 95, O.S.L. 2018 (36 O.S. Supp. 2020,
619	1206		Section 1250.7), is amended to read as follows:
	1207	+
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620	1232
621	1233		Section 1250.7. A. Within sixty ( 60) days after receipt by a
622	1234		property and casualty insurer of properly executed proofs of loss,
623	1235		the first party claimant shall be advised of the acceptance or
624	1236		denial of the claim by the insurer, or if further investigation is
625	1237		necessary. No property and cas ualty insurer shall deny a claim
626	1238		because of a specific policy provision, condition, or exclusion
627	1239		unless reference to such provision, condition, or exclusion is
628	1240		included in the denial. A denial shall be given to any claimant in
629	1241		writing, and the claim file of the property and casualty insurer
630	1242		shall contain a copy of the denial. If there is a reasonable basis
631	1243		supported by specific information available for review by the
632	1244		Commissioner that the first party claimant has fraudulently caused
633	1245		or contributed to the loss, a property and casualty insurer shall be
634	1246		relieved from the requirements of this subsection. In the event of
635	1247		a weather-related catastrophe or a major natural disaster, as
636	1248		declared by the Governor, the Insurance Commissioner may extend the
637	1249		deadline imposed under this subsection an additional twenty (20)
638	1250		days.
639		-
640	1251		B. If a claim is denied for reasons other than those described
641	1252		in subsection A of this section, and is made by any other means than
642	1253		writing, an appropriate notation shall be made in the claim fil e of
643	1254		the property and casualty insurer until such time as a written
644	1255		confirmation can be made.
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645	1281
646	1282		C. Every property and casualty insurer shall complete
647	1283		investigation of a claim within sixty (60) days after notification
648	1284		of proof of loss unless such investigati on cannot reasonably be
649	1285		completed within such time. If such investigation cannot be
650	1286		completed, or if a property and casualty insurer needs more time to
651	1287		determine whether a claim should be accepted or denied, it shall so
652	1288		notify the claimant within sixty (6 0) days after receipt of the
653	1289		proofs of loss, giving reasons why more time is needed. If the
654	1290		investigation remains incomplete, a property and casualty insurer
655	1291		shall, within sixty (60) days from the date of the initial
656	1292		notification, send to such claimant a letter setting forth the
657	1293		reasons additional time is needed for investigation. Except for an
658	1294		investigation of possible fraud or arson which is supported by
659		-
660		-	ENR. S. B. NO. 887 Page 16
661	1295		specific information giving a reasonable basis for the
662	1296		investigation, the time for investigation sha ll not exceed one
663	1297		hundred twenty (120) days after receipt of proof of loss. Provided,
664	1298		in the event of a weather -related catastrophe or a major natural
665	1299		disaster, as declared by the Governor, the Insurance Commissioner
666	1300		may extend this deadline for investiga tion an additional twenty (20)
667	1301		days.
668		-
669	1302		D. Insurers shall not fail to settle first party claims on the
670	1303		basis that responsibility for payment should be assumed by others
671	1304		except as may otherwise be provided by policy provisions.
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672	1330
673	1331		E. Insurers shall not continue or delay negotiations for
674	1332		settlement of a claim directly with a claimant who is neither an
675	1333		attorney nor represented by an attorney, for a length of time which
676	1334		causes the claimant's rights to be affected by a statute of
677	1335		limitations, or a policy or contract time limit, without giving the
678	1336		claimant written notice that the time limit is expiring and may
679	1337		affect the claimant's rights. Such notice shall be given to first
680	1338		party claimants thirty (30) days, and to third party claimants sixty
681	1339		(60) days, before the da te on which such time limit may expire one
682	1340		year after the date of the loss .
683		-
684	1341		F. No insurer shall make statements which indicate that the
685	1342		rights of a third party claimant may be impaired if a form or
686	1343		release is not completed within a given period of time un less the
687	1344		statement is given for the purpose of notifying a third party
688	1345		claimant of the provision of a statute of limitations.
689		-
690	1346		G. If a lawsuit on the claim is initiated, the time limits
691	1347		provided for in this section shall not apply.
692		-
693		-	SECTION 9. AMENDATORY 36 O.S. 2011, Section 1250.8, is
	1348	+	SECTION 10. AMENDATORY 36 O.S. 2011, Section 1250.8, is
694	1349		amended to read as follows:
695		-
696	1350		Section 1250.8. A. If an insurance policy or insurance
697	1351		contract provides for the adjustment and settlement of first party
698	1352		motor vehicle total losses, on the basis of act ual cash value or
699	1353		replacement with another of like kind and quality, one of the
700	1354		following methods shall apply:
701	1355
702		-
703		-	ENR. S. B. NO. 887 Page 17
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	1380	+
704	1381		1. An insurer may elect to offer a replacement motor vehicle
705	1382		which is a specific comparable motor vehicle available to the
706	1383		insured, with all app licable taxes, license fees, and other fees
707	1384		incident to the transfer of evidence of ownership of the motor
708	1385		vehicle paid, at no cost to the insured other than any deductible
709	1386		provided in the policy. The offer and any rejection thereof shall
710	1387		be documented in the claim file; or
711		-
712	1388		2. An insurer may elect a cash settlement based upon the actual
713	1389		cost, less any deductible provided in the policy, to purchase a
714	1390		comparable motor vehicle, including all applicable taxes, license
715	1391		fees and other fees incident to a transfe r of evidence of ownership,
716	1392		or a comparable motor vehicle. Such cost may be determined by:
717		-
718	1393		a. the cost of a comparable motor vehicle in the local
719	1394		market area when a comparable motor vehicle is
720	1395		currently or recently available in the prior ninety
721	1396		(90) days in the local market area,
722		-
723	1397		b. one of two or more quotations obtained by an insurer
724	1398		from two or more qualified dealers located within the
725	1399		local market area when a comparable motor vehicle is
726	1400		not available in the local market area, or
727		-
728	1401		c. the cost of a compara ble motor vehicle as quoted in
729	1402		the latest edition of the National Automobile Dealers
730	1403		Association Official Used Car Guide or monthly edition
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731	1430		of any other nationally recognized published
732	1431		guidebook.
733		-
734	1432		B. If a first party motor vehicle total loss is settled on a
735	1433		basis which deviates from the methods described in subsection A of
736	1434		this section, the deviation shall be supported by documentation
737	1435		giving particulars of the condition of the motor vehicle. Any
738	1436		deductions from such cost, including, but not limited to, de duction
739	1437		for salvage, shall be measurable, discernible, itemized and
740	1438		specified as to dollar amount and shall be appropriate in amount.
741	1439		The basis for such settlement shall be fully explained to a first
742	1440		party claimant.
743		-
744	1441		C. If liability for motor vehicle dama ges is reasonably clear,
745	1442		insurers shall not recommend that third party claimants make claims
746		-
747		-	ENR. S. B. NO. 887 Page 18
748	1443		pursuant to the third party claimants' own policies solely to avoid
749	1444		paying claims pursuant to such insurer's insurance policy or
750	1445		insurance contract.
751		-
752	1446		D. Insurers shall not require a claimant to travel unreasonably
753	1447		either to inspect a replacement motor vehicle, obtain a repair
754	1448		estimate or have the motor vehicle repaired at a specific repair
755	1449		shop.
756		-
757	1450		E. Insurers shall, upon the request of a claimant, include the
758	1451		deductible of a first party claimant, if any, in subrogation
759	1452		demands. Subrogation recoveries shall be shared on a proportionate
760	1453		basis with a first party claimant, unless the deductible amount has
	1454	+
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761	1480		been otherwise recovered. No deduction for expenses shall be made
762	1481		from a deductible recovery unless an outside attorney is retained to
763	1482		collect such recovery. The deduction shall then be made for only a
764	1483		pro rata share of the allocated loss adjustment expense.
765		-
766	1484		F. If an insurer prepares an estimate of the cost of automob ile
767	1485		repairs, such estimate shall be in an amount for which it reasonably
768	1486		may be expected that the damage can be repaired satisfactorily. An
769	1487		insurer shall give a copy of an estimate to a claimant and may
770	1488		furnish to the claimant the names of one or more con veniently
771	1489		located repair shops, if requested by the claimant.
772		-
773	1490		G. If an amount claimed is reduced because of betterment or
774	1491		depreciation, all information for such reduction shall be contained
775	1492		in the claim file. Such deductions shall be itemized and specifi ed
776	1493		as to dollar amount and shall be appropriate for the amount of
777	1494		deductions.
778		-
779	1495		H. An insurer or its representative shall not require a
780	1496		claimant to obtain motor vehicle repairs at a specific repair
781	1497		facility. An insurer or its representative shall not requi re a
782	1498		claimant to obtain motor vehicle glass repair or replacement at a
783	1499		specific motor vehicle glass repair or replacement facility. An
784	1500		insurer shall fully and promptly pay for the cost of the motor
785	1501		vehicle repair services or products, less any applicable deductible
786	1502		amount payable according to the terms of the policy. The claimant
787	1503		shall be furnished an itemized priced statement of repairs by the
	1504	+
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788	1530		repair facility at the time of acceptance of the repaired motor
789	1531		vehicle. Unless a cash settlement is made, if a claimant selects a
790		-
791		-	ENR. S. B. NO. 887 Page 19
792	1532		motor vehicle repair or motor vehicle glass repair or replacement
793	1533		facility, the insurer shall provide payment to the facility or
794	1534		claimant based on a competitive price, as established by that
795	1535		insurer through market surveys or by the insu red through competitive
796	1536		bids at the insured's option, to determine a fair and reasonable
797	1537		market price for similar services. Reasonable deviation from this
798	1538		market price is allowed based on the facts in each case.
799		-
800	1539		I. An insurer shall not use as a basis for cash settlement with
801	1540		a first party claimant an amount which is less than the amount which
802	1541		an insurer would pay if repairs were made, other than in total loss
803	1542		situations, unless such amount is agreed to by the insured.
804		-
805	1543		J. An insurer shall not force a clai mant to execute a full
806	1544		settlement release in order to settle a property damage claim
807	1545		involving a personal injury.
808		-
809	1546		K. All payment or satisfaction of a claim for a motor vehicle
810	1547		which has been transferred by title to the insurer shall be paid by
811	1548		check or, draft or electronic payment , payable on demand.
812		-
813	1549		L. In the event of payment of a total loss to a third party
814	1550		claimant, the insurer shall include any registered lienholder as
815	1551		copayee to the extent of the lienholder's interest.
816		-
817	1552		M. As used in this section, "t otal loss" means that the vehicle
818	1553		repair costs plus the salvage value of the vehicle meets or exceeds
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819	1580		the actual cash value of the motor vehicle prior to the loss, as
820	1581		provided in used automobile dealer guidebooks.
821		-
822	1582		N. An insurer shall not offer a cash sett lement as provided in
823	1583		paragraph 2 of subsection A of this section for the purchase of a
824	1584		comparable motor vehicle and then subsequently sell the motor
825	1585		vehicle which has been determined to be a total loss back to the
826	1586		claimant if the insurer has determined th at the repair of the
827	1587		vehicle would not result in the vehicle being restored to operative
828	1588		condition as provided in Section 1111 of Title 47 of the Oklahoma
829	1589		Statutes unless the claimant specifies in writing or via an
830	1590		electronic signature that the claimant un derstands that the motor
831	1591		vehicle shall be titled as a "junked vehicle".
832		-
833		-
834		-	ENR. S. B. NO. 887 Page 20
835		-	SECTION 10. AMENDATORY 36 O.S. 2011, Section 1435.20, as
	1592	+	SECTION 11. AMENDATORY 36 O.S. 2011, Section 1435.20, as
836	1593		last amended by Section 1, Chapter 263, O.S.L. 2019 (36 O.S. Supp.
837	1594		2020, Section 1435.20), is amended to read as follows:
838		-
839	1595		Section 1435.20. A. A limited lines producer may receive
840	1596		qualification for a license in one or more of the following
841	1597		categories:
842		-
843	1598		1. Prepaid legal liability insurance, which means the
844	1599		assumption of an enforceable contractual obligatio n to provide
845	1600		specified legal services or to reimburse policyholders for specified
846	1601		legal expenses, pursuant to the provisions of a group or individual
847	1602		policy;
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848	1628
849	1629		2. Crop - insurance providing protection against damage to
850	1630		crops from unfavorable weather conditi ons, fire or lightning, flood,
851	1631		hail, insect infestation, disease or other yield -reducing conditions
852	1632		or perils provided by the private insurance market, or that is
853	1633		subsidized by the Federal Crop Insurance Corporation, including
854	1634		Multi-Peril Crop Insurance;
855		-
856	1635		3. Car rental - insurance offered, sold or solicited in
857	1636		connection with and incidental to the rental of rental cars for a
858	1637		period of two (2) years, whether at the rental office or by
859	1638		preselection of coverage in master, corporate, group or individual
860	1639		agreements that:
861		-
862	1640		a. is nontransferable,
863		-
864	1641		b. applies only to the rental car that is the subject of
865	1642		the rental agreement, and
866		-
867	1643		c. is limited to the following kinds of insurance:
868		-
869	1644		(1) personal accident insurance for renters and other
870	1645		rental car occupants, for accidenta l death or
871	1646		dismemberment, and for medical expenses resulting
872	1647		from an accident that occurs with the rental car
873	1648		during the rental period,
874		-
875	1649		(2) liability insurance that provides protection to
876	1650		the renters and other authorized drivers of a
877		-
878		-	ENR. S. B. NO. 887 Page 21
879	1651		rental car for liabili ty arising from the
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880	1678		operation or use of the rental car during the
881	1679		rental period,
882		-
883	1680		(3) personal effects insurance that provides coverage
884	1681		to renters and other vehicle occupants for loss
885	1682		of, or damage to, personal effects in the rental
886	1683		car during the rental pe riod,
887		-
888	1684		(4) roadside assistance and emergency sickness
889	1685		protection insurance, or
890		-
891	1686		(5) any other coverage designated by the Insurance
892	1687		Commissioner.
893		-
894	1688		A car rental limited lines license issued to a rental or leasing
895	1689		company shall authorize any employee or authoriz ed representative of
896	1690		the rental or leasing company to sell or offer coverage at each
897	1691		location at which the rental or leasing company operates. Employees
898	1692		or authorized representatives are not required to be individually
899	1693		licensed;
900		-
901	1694		4. Credit - credit life, credit disability, credit property,
902	1695		credit unemployment, involuntary unemployment, mortgage life,
903	1696		mortgage guaranty, mortgage disability, guaranteed automobile
904	1697		protection insurance, or any other form of insurance offered in
905	1698		connection with an extension of credit that is limited to partially
906	1699		or wholly extinguishing that credit obligation and that is
907	1700		designated by the Insurance Commissioner as limited line credit
908	1701		insurance;
909	1702
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910	1728		5. Surety - insurance or bond that covers obligations to pay
911	1729		the debts of, or answer for the default of another, including
912	1730		faithlessness in a position of public or private trust. For purpose
913	1731		of limited line licensing, surety does not include surety bail
914	1732		bonds;
915		-
916	1733		6. Travel; and
917		-
918	1734		7. Self-service storage insurance, pursuant to Section 2 of
919	1735		this act 1435.20a of this title; and
920		-
921		-
922		-	ENR. S. B. NO. 887 Page 22
923	1736		8. Motor Service Club limited lines producer, pursuant to
924	1737		Sections 3101 et seq. of this title .
925		-
926	1738		B. 1. An insurance producer or limited lines producer may
927	1739		solicit applications for and issue travel accident policies or
928	1740		baggage insurance by means of mechanical vending machines supervised
929	1741		by the insurance producer or limited lines producer only if the
930	1742		Insurance Commissioner shall determine that the form of policy to be
931	1743		sold is reasonably suited for sale and issuance through vending
932	1744		machines, that use of vending machines for the sale of policies
933	1745		would be of convenience to the public, and that the type of vending
934	1746		machine to be used is reasonably suitable and practical for the sale
935	1747		and issuance of policies. Policies so sold do not have to be
936	1748		countersigned.
937		-
938	1749		2. The Commissioner shall issue to the insurance agent or
939	1750		limited insurance representative a special vending machine license
940	1751		for each such machine to be used. The license shall specify the
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941	1778		name and address of the insurer and licensee, the kind of insurance
942	1779		and type of policy to be sold, and the place where the machine is to
943	1780		be in operation. The license shall expire, be renewable, and be
944	1781		suspended or revoked coincidentally with the insurance agent license
945	1782		or limited represent ative license of the licensee. The license fee
946	1783		for each vending machine shall be that stated in the provisions of
947	1784		Section 1435.23 of this title. Proof of existence of the license
948	1785		shall be displayed on or about each machine in such manner as the
949	1786		Commissioner may reasonably require.
950		-
951		-	SECTION 11. AMENDATORY 36 O.S. 2011, Section 1445, is
	1787	+	SECTION 12. AMENDATORY 36 O.S. 2011, Section 1445, is
952	1788		amended to read as follows:
953		-
954	1789		Section 1445. A. All insurance charges or premiums collected
955	1790		by an administrator for an insurer or trust and all return premiums
956	1791		received from the insurer or trust shall be held by the
957	1792		administrator in a fiduciary capacity. These funds shall be
958	1793		immediately remitted to the person entitled to the funds or shall be
959	1794		deposited promptly in a fiduciary bank account established a nd
960	1795		maintained by the administrator.
961		-
962	1796		B. If charges or premiums deposited in a fiduciary account have
963	1797		been collected for more than one insurer or trust, the administrator
964	1798		shall keep records showing the deposits to and withdrawals from the
965		-
966		-	ENR. S. B. NO. 887 Page 23
967	1799		account for each insurer or trust. The administrator, upon request
968	1800		of an insurer or trust, shall furnish copies of the records
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969	1827		pertaining to deposits to and withdrawals from the account for that
970	1828		insurer or trust.
971		-
972	1829		C. The administrator shall not pay any claim by withdrawals
973	1830		from a fiduciary account unless provisions for said withdrawals are
974	1831		included in the written agreement between the insurer or trust and
975	1832		the administrator. The written agreement shall authorize
976	1833		withdrawals by the administrator from the fiduciary account on ly
977	1834		for:
978		-
979	1835		1. remittance Remittance to an insurer or trust entitled to a
980	1836		remittance; or
981		-
982	1837		2. deposit Deposit in an account maintained in the name of an
983	1838		insurer or trust; or
984		-
985	1839		3. transfer Transfer to and deposit in an account established
986	1840		for payment of claims, as provided for by subsection D of this
987	1841		section; or
988		-
989	1842		4. payment Payment to a group policyholder for remittance to
990	1843		the insurer or trust entitled to such remittance; or
991		-
992	1844		5. payment Payment of commission, fees, or charges to the
993	1845		administrator; or
994		-
995	1846		6. remittance Remittance of return premiums to the person
996	1847		entitled to such return premiums.
997		-
998	1848		D. All claims paid by the administrator from funds collected on
999	1849		behalf of the insurer or trust shall be paid on drafts or, checks or
1000	1850		electronic payment authorized by the insu rer or trust.
1001	1851
1002		-	SECTION 12. AMENDATORY 36 O.S. 2011, Section 1450, as
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	1876	+
	1877	+	SECTION 13. AMENDATORY 36 O.S. 2011, Section 1450, as
1003	1878		amended by Section 6, Chapter 294, O.S.L. 2019 (36 O.S. Supp. 2020,
1004	1879		Section 1450), is amended to read as follows:
1005		-
1006	1880		Section 1450. A. No person shall act as or pres ent himself or
1007	1881		herself to be an administrator, as defined by the provisions of the
1008	1882		Third-party Administrator Act, in this state, unless the person
1009		-
1010		-	ENR. S. B. NO. 887 Page 24
1011	1883		holds a valid license as an administrator which is issued by the
1012	1884		Insurance Commissioner.
1013		-
1014	1885		B. An administrator shall not be eligible for a nonresident
1015	1886		administrator license under this section if the administrator does
1016	1887		not hold a home state certificate of authority or license in a state
1017	1888		that has adopted the Third -party Administrator Act or that applies
1018	1889		substantially similar provisions as are contained in the Third -party
1019	1890		Administrator Act to that administrator. If the Third -party
1020	1891		Administrator Act in the administrator's home state does not extend
1021	1892		to stop-loss insurance, but if the home state otherwise applies
1022	1893		substantially similar provisions as are contained in the Third -party
1023	1894		Administrator Act to that administrator, then that omission shall
1024	1895		not operate to disqualify the administrator from receiving a
1025	1896		nonresident administrator license in this state.
1026		-
1027	1897		1. "Home state" means the United States jurisdiction that has
1028	1898		adopted the Third-party Administrator Act or a substantially similar
1029	1899		law governing third-party administrators and which has been
1030	1900		designated by the administrator as its principal regulator. The
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1031	1927		administrator may designate either its state of incorporation or its
1032	1928		principal place of business within the United States if that
1033	1929		jurisdiction has adopted the Third -party Administrator Act or a
1034	1930		substantially similar law governing third -party administrators. If
1035	1931		neither the administrator's state of incorporation nor its principal
1036	1932		place of business within the United States has adopted the Third -
1037	1933		party Administrator Act or a substantially similar law governing
1038	1934		third-party administrators, then the third -party administrator shal l
1039	1935		designate a United States jurisdiction in which it does business and
1040	1936		which has adopted the Third -party Administrator Act or a
1041	1937		substantially similar law governing third -party administrators. For
1042	1938		purposes of this definition paragraph, "United States juris diction"
1043	1939		means the District of Columbia or a state or territory of the United
1044	1940		States.
1045		-
1046	1941		2. "Nonresident administrator" means a person who is applying
1047	1942		for licensure or is licensed in any state other than the
1048	1943		administrator's home state.
1049		-
1050	1944		C. In the case of a p artnership which has been licensed, each
1051	1945		general partner shall be named in the license licensed and shall
1052	1946		qualify therefore as though an individual licensee. The
1053		-
1054		-	ENR. S. B. NO. 887 Page 25
1055	1947		Commissioner shall charge a full additional license fee and a
1056	1948		separate license shall be issue d for each individual so named in
1057	1949		such a license. The partnership shall notify the Commissioner
1058	1950		within fifteen (15) thirty (30) days if any individual licensed on
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1059	1977		its behalf has been terminated, or is no longer associated with or
1060	1978		employed by the partnersh ip. Any entity or partnership person
1061	1979		making application as an administrator or currently licensed as
1062	1980		administrators an administrator under the Third-party Administrators
1063	1981		Act shall provide a National Association of Insurance Commissioner
1064	1982		(NAIC) Biographical Affidavits Affidavit and a comprehensive review
1065	1983		of the background report by an independent third -party NAIC-approved
1066	1984		vendor as required for domestic insurers pursuant to the insurance
1067	1985		laws of this state.
1068		-
1069	1986		D. An application for an administrator's license shall be in a
1070	1987		form prescribed by the Commissioner and shall be accompanied by a
1071	1988		fee of One Hundred Dollars ($100.00). This fee shall not be
1072	1989		refundable if the application is denied or refused for any reason by
1073	1990		either the applicant or the Commissioner.
1074		-
1075	1991		E. The administrator's license shall continue in force no
1076	1992		longer than twelve (12) months from the original month of issuance.
1077	1993		Upon filing a renewal form prescribed by the Commissioner,
1078	1994		accompanied by a fee of One Hundred Dollars ($100.00), the license
1079	1995		may be renewed annually for a one -year term. Late application for
1080	1996		renewal of a license shall require a fee of double the amount of the
1081	1997		original license fee. The administrator shall submit, together with
1082	1998		the application for renewal, a list of the names and addr esses of
1083	1999		the persons with whom the administrator has contracted in accordance
1084	2000		with Section 1443 of this title. The Commissioner shall hold this
	2001	+
	2002	+	ENGR. S. B. NO. 887 Page 37 1
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1085	2027		information confidential except as provided in Section 1443 of this
1086	2028		title.
1087		-
1088	2029		F. 1. The administrator's license shall be issued or renewed
1089	2030		by the Commissioner unless, after notice and opportunity for
1090	2031		hearing, the Commissioner determines that the administrator is not
1091	2032		competent, trustworthy, or financially responsible, or has had any
1092	2033		insurance license denied for cause by any state, has been convicted
1093	2034		or has pleaded guilty or nolo contendere to any felony or to a
1094	2035		misdemeanor involving moral turpitude or dishonesty.
1095		-
1096		-
1097		-	ENR. S. B. NO. 887 Page 26
1098	2036		2. The administrator shall report to the Insurance Commissioner
1099	2037		any administrative or criminal action tak en against the
1100	2038		administrator in another jurisdiction or by another governmental
1101	2039		agency in this state within thirty (30) calendar days of the final
1102	2040		disposition of the matter. This report shall include a copy of the
1103	2041		order, consent to order, copy of any paym ent required as a result of
1104	2042		the administrative or criminal action, or other relevant legal
1105	2043		documents.
1106		-
1107	2044		3. Any entity making application to the Oklahoma Insurance
1108	2045		Department as a third -party administrator (TPA) or within thirty
1109	2046		(30) days of a change for a l icensed TPA shall provide current
1110	2047		National Association of Insurance Commissioners (NAIC) Biographical
1111	2048		Affidavits and independent third -party background reports from a
1112	2049		NAIC-approved vendor on behalf of all officers, directors and key
1113	2050		managerial personnel of the TPA, and individuals with a ten percent
	2051	+
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1114	2077		(10%) or more beneficial ownership in the TPA and the TPA's ultimate
1115	2078		controlling person (affiant) as required for insurers pursuant to
1116	2079		the laws of this state.
1117		-
1118	2080		G. After notice and opportunity for hearing, and up on
1119	2081		determining that the administrator has violated any of the
1120	2082		provisions of the Oklahoma Insurance Code or upon finding reasons
1121	2083		for which the issuance or nonrenewal of such license could have been
1122	2084		denied, the Commissioner may either suspend or revoke an
1123	2085		administrator's license or assess a civil penalty of not more than
1124	2086		Five Thousand Dollars ($5,000.00) for each occurrence. The payment
1125	2087		of the penalty may be enforced in the same manner as civil judgments
1126	2088		may be enforced.
1127		-
1128	2089		H. Any person who is acting as or pr esenting himself or herself
1129	2090		to be an administrator without a valid license shall be subject,
1130	2091		upon conviction, to a fine of not less than One Thousand Dollars
1131	2092		($1,000.00) nor more than Ten Thousand Dollars ($10,000.00) for each
1132	2093		occurrence. This fine shall be in addition to any other penalties
1133	2094		which may be imposed for violations of the Oklahoma Insurance Code
1134	2095		or other laws of this state.
1135		-
1136	2096		I. Except as provided for in subsections F and G of this
1137	2097		section, any person convicted of violating any provisions of the
1138	2098		Third-party Administrator Act shall be guilty of a misdemeanor and
1139		-
1140		-	ENR. S. B. NO. 887 Page 27
1141	2099		shall be subject to a fine of not more than One Thousand Dollars
1142	2100		($1,000.00).
1143	2101
1144		-	SECTION 13. AMENDATORY 36 O.S. 2011, Section 2004, is
	2102	+	ENGR. S. B. NO. 887 Page 39 1
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	2126	+
	2127	+	SECTION 14. AMENDATORY 36 O.S. 2011, Section 2004, is
1145	2128		amended to read as follows:
1146		-
1147	2129		Section 2004. As used in the Oklahoma Property and Casualty
1148	2130		Insurance Guaranty Association Act:
1149		-
1150	2131		1. "Affiliate" means a person who directly or indirectly,
1151	2132		through one or more intermediaries, controls, is controlled by, or
1152	2133		is under common control with another person on December 31 of the
1153	2134		year next preceding the date the insurer becomes an insolvent
1154	2135		insurer;
1155		-
1156	2136		2. "Association" means the Oklahoma Property and Casualty
1157	2137		Insurance Guaranty Association as created in Section 2005 of this
1158	2138		title;
1159		-
1160	2139		3. "Assumed claims tra nsaction" means:
1161		-
1162	2140		a. policy obligations that have been assumed by the
1163	2141		insolvent insurer, prior to the entry of a final
1164	2142		order of liquidation, pursuant to a plan, approved by
1165	2143		a domestic commissioner of the assuming insurer,
1166	2144		which transfers the direct policy o bligations and
1167	2145		future policy renewals from one insurer to another
1168	2146		insurer, or
1169		-
1170	2147		b. an assumption reinsurance transaction in which all of
1171	2148		the following have occurred:
1172		-
1173	2149		(1) the insolvent insurer assumed, prior to the
1174	2150		entry of a final order of liquidation, the c laim
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	2176	+
1175	2177		or policy obligations of another insurer under
1176	2178		the claims or policies,
1177		-
1178	2179		(2) the assumption of the claim or policy
1179	2180		obligations has been approved, if an approval is
1180	2181		required, by the appropriate regulatory
1181	2182		authorities, and
1182		-
1183		-
1184		-	ENR. S. B. NO. 887 Page 28
1185	2183		(3) as a result of the assumptio n, the claim or
1186	2184		policy obligations became the direct obligations
1187	2185		of the insolvent insurer through novation of the
1188	2186		claims or policies;
1189		-
1190	2187		4. "Claimant" means any person instituting a covered claim;
1191	2188		provided that no person who is an affiliate of the insolvent insurer
1192	2189		may be a claimant;
1193		-
1194	2190		5. "Commissioner" means the Insurance Commissioner of Oklahoma;
1195		-
1196	2191		6. "Control" means the possession, direct or indirect, of the
1197	2192		power to direct or cause the direction of the management and
1198	2193		policies of a person, whether through th e ownership of voting
1199	2194		securities, by contract other than a commercial contract for goods
1200	2195		or nonmanagement services, or otherwise, unless the power is the
1201	2196		result of an official position with or corporate office held by the
1202	2197		person. Control shall be presumed to exist if a person, directly or
1203	2198		indirectly, owns, controls, holds with the power to vote, or holds
1204	2199		proxies representing ten percent (10%) or more of the voting
	2200	+
	2201	+	ENGR. S. B. NO. 887 Page 41 1
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1205	2226		securities of any other person. This presumption may be rebutted by
1206	2227		a showing that control d oes not exist in fact;
1207		-
1208	2228		7. "Covered claim" means:
1209		-
1210	2229		a. an unpaid claim, including one of unearned premiums,
1211	2230		submitted by a claimant, which arises out of and is
1212	2231		within the coverage and is subject to the applicable
1213	2232		limits of an insurance policy to which this a ct
1214	2233		applies, if the insurer becomes an insolvent insurer
1215	2234		after the effective date of this act and the policy
1216	2235		was issued by the insurer, and:
1217		-
1218	2236		(1) the claimant or insured is a resident of this
1219	2237		state at the time of the insured event, provided
1220	2238		that for entities other than an individual, the
1221	2239		residence of a claimant or insured is the state
1222	2240		in which its principal place of business is
1223	2241		located at the time of the insured event, or
1224		-
1225	2242		(2) the property from which the claim arises is
1226	2243		permanently located in this state,
1227		-
1228		-	ENR. S. B. NO. 887 Page 29
1229		-
1230	2244		b. "Covered claim" shall not include:
1231		-
1232	2245		(1) any amount awarded as punitive or exemplary
1233	2246		damages,
1234		-
1235	2247		(2) any amount sought as a return of premium under
1236	2248		any retrospective rating plan,
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	2250	+	ENGR. S. B. NO. 887 Page 42 1
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1237	2274
1238	2275		(3) any amount due any reinsurer, insurer, insurance
1239	2276		pool, or underwriting associati on, health
1240	2277		maintenance organization, hospital plan
1241	2278		corporation, professional health service
1242	2279		corporation or self-insurer as subrogation
1243	2280		recoveries, reinsurance recoveries, contribution,
1244	2281		indemnification or otherwise. No claim for any
1245	2282		amount due any reinsure r, insurer, insurance
1246	2283		pool, or underwriting association, health
1247	2284		maintenance organization, hospital plan
1248	2285		corporation, professional health service
1249	2286		corporation or self-insurer may be asserted
1250	2287		against a person insured under a policy issued by
1251	2288		an insolvent insurer other than to the extent the
1252	2289		claim exceeds the association obligation
1253	2290		limitations set for in Section 2007 of this
1254	2291		title,
1255		-
1256	2292		(4) any claims excluded pursuant to Section 15 of
1257	2293		this act due to the high net worth of an insured,
1258		-
1259	2294		(5) any first party claims by a n insured that is an
1260	2295		affiliate of the insolvent company,
1261		-
1262	2296		(6) any fee or other amount relating to goods or
1263	2297		services sought by or on behalf of any attorney
1264	2298		or other provider of goods and services retained
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1265	2325		by the insolvent insurer or an insured prior to
1266	2326		the date it was determined to be insolvent,
1267		-
1268	2327		(7) any fee or other amount sought by or on behalf of
1269	2328		any attorney or other provider of goods and
1270	2329		services retained by any insured or claimant in
1271		-
1272		-	ENR. S. B. NO. 887 Page 30
1273	2330		connection with the assertion or prosecution of
1274	2331		any claim, covered or o therwise, against the
1275	2332		Association,
1276		-
1277	2333		(8) any claims for interest, or
1278		-
1279	2334		(9) any claim filed with the association or a
1280	2335		liquidator for protection afforded under the
1281	2336		policy of the insured for incurred -but-not-
1282	2337		reported losses, or
1283		-
1284	2338		(10) notwithstanding any other prov ision of this act
1285	2339		or any other law to the contrary, a claim that is
1286	2340		filed with the association on a date that is
1287	2341		later than eighteen (18) months after the date of
1288	2342		the order of liquidation or that is unknown and
1289	2343		unreported as of said date; provided, however ,
1290	2344		that this shall not include any claim for
1291	2345		workers' compensation benefits pursuant to Title
1292	2346		85A of the Oklahoma Statutes and the applicable
1293	2347		rules of OAC Title 810 ;
1294	2348
	2349	+	ENGR. S. B. NO. 887 Page 44 1
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	2373	+
1295	2374		8. "Insolvent insurer" means an insurer that is licensed to
1296	2375		transact insurance in this sta te either at the time the policy was
1297	2376		issued, when the obligation with respect to the covered claim was
1298	2377		assumed under an assumed claims transaction, or when the insured
1299	2378		event occurred and against whom a final order of liquidation has
1300	2379		been entered after the effective date of this act with a finding of
1301	2380		insolvency by a court of competent jurisdiction in the state of
1302	2381		domicile of the insurer;
1303		-
1304	2382		9. "Insured" means any named insured, any additional insured,
1305	2383		any vendor, lessor or any other party identified as an insu red under
1306	2384		the policy;
1307		-
1308	2385		10. a. "Member insurer" means any person who:
1309		-
1310	2386		(1) writes any kind of insurance to which the
1311	2387		Oklahoma Property and Casualty Insurance Guaranty
1312	2388		Association Act applies pursuant to Section 2003
1313	2389		of this title, including the exchange of
1314	2390		reciprocal or inter-insurance contracts, and
1315		-
1316		-	ENR. S. B. NO. 887 Page 31
1317		-
1318	2391		(2) is licensed to transact insurance in this state,
1319	2392		except those insurers enumerated in Section 110
1320	2393		of this title or those insurers that are
1321	2394		otherwise exempted by law or order of the
1322	2395		Commissioner.
1323		-
1324	2396		b. An insurer shall cease to be a member insurer
1325	2397		effective on the day following the termination or
	2398	+
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1326	2424		expiration of its license to transact the kinds of
1327	2425		insurance to which the Oklahoma Property and Casualty
1328	2426		Insurance Guaranty Association Act applies; however,
1329	2427		the insurer shall be liable as a member insurer for
1330	2428		any and all obligations, including but not limited to
1331	2429		obligations for assessments levied after the
1332	2430		termination or expiration, which relate to any insurer
1333	2431		that becomes an insolvent insurer prior to the
1334	2432		termination or expiration of the license of the
1335	2433		insurer;
1336		-
1337	2434		11. "Net direct written premiums" means direct gross premiums
1338	2435		written in this state on insurance policies to which this act
1339	2436		applies, including but not limited to policy and membership fees,
1340	2437		less the following amoun ts:
1341		-
1342	2438		a. return premiums,
1343		-
1344	2439		b. premiums on policies not taken, and
1345		-
1346	2440		c. dividends paid or credited to policyholders on direct
1347	2441		business. "Net direct written premiums" does not
1348	2442		include premiums on contracts between insurers or
1349	2443		reinsurers;
1350		-
1351	2444		12. "Novation" means th at the assumed claim or policy
1352	2445		obligations became the direct obligations of the insolvent insurer
1353	2446		through consent of the policyholder and that thereafter the ceding
1354	2447		insurer or entity initially obligated under the claims or policies
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1355	2474		is released by the polic yholder from performing its claim or policy
1356	2475		obligations. Consent shall be express and an implied novation shall
1357	2476		not be allowed for the purposes, implementation and application of
1358		-
1359		-	ENR. S. B. NO. 887 Page 32
1360	2477		the Oklahoma Property and Casualty Insurance Guaranty Association
1361	2478		Act;
1362		-
1363	2479		13. "Person" means the individual or other entities as defined
1364	2480		in Section 104 of this title;
1365		-
1366	2481		14. "Receiver" means liquidator, rehabilitator, conservator or
1367	2482		ancillary receiver, as the context requires; and
1368		-
1369	2483		15. "Self-insurer" means a person who covers its liab ility
1370	2484		through a qualified individual or group self -insurance program or
1371	2485		any other formal program created for the specific purpose of
1372	2486		covering liabilities typically covered by insurance.
1373		-
1374		-	SECTION 14. AMENDATORY 36 O.S. 2011, Section 2006, as
	2487	+	SECTION 15. AMENDATORY 36 O.S. 2011, Section 2006, as
1375	2488		amended by Section 1, Chapter 78, O.S.L. 2014 (36 O.S. Supp. 2020,
1376	2489		Section 2006), is amended to read as follows:
1377		-
1378	2490		Section 2006. A. The business and functions of the Oklahoma
1379	2491		Property and Casualty Insurance Guaranty Association shall be
1380	2492		managed and administered by a board of twelve (12) directors
1381	2493		composed of two members selected by the American Insurance
1382	2494		Association who are member insurers; at the expiration of the terms
1383	2495		of the members selected by the Alliance of American Insurers who are
1384	2496		serving on November 1, 2014, two members selected by the Property
1385	2497		and Casualty Insurers Association of America who are member
	2498	+
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1386	2524		insurers; at the expiration of the terms of the members selected by
1387	2525		the National Association of Independent Insurers who are serving on
1388	2526		November 1, 2014, two members selected by the National Association
1389	2527		of Mutual Insurance Companies who are member insurers; two Oklahoma
1390	2528		domestic insurers who are member insurers; two nonaffiliated foreign
1391	2529		or alien insurers who are member insurers; two insuranc e agents who
1392	2530		shall serve as ex officio members on the board domestic, foreign and
1393	2531		alien insurers who are member insurers, including a minimum of two
1394	2532		domestic insurers, and two insurance agents who shall serve as ex
1395	2533		officio members. In determining candidat es to fill the member
1396	2534		insurer positions, the board shall consider whether all insurers are
1397	2535		fairly represented, including workers' compensation insurers and
1398	2536		other property and casualty insurers . One of the ex officio members
1399	2537		shall be the Executive Director of the Independent Insurance Agents
1400	2538		of Oklahoma, Inc.; the other ex officio member shall be a licensed,
1401	2539		resident property and casualty insurance agent chosen by the
1402		-
1403		-	ENR. S. B. NO. 887 Page 33
1404	2540		Governor. Each member of the board of directors shall designate a
1405	2541		full-time salaried employee to represent it on the board of
1406	2542		directors. Each member except for the ex officio members shall
1407	2543		serve for a term of two (2) years. The ex officio member who is
1408	2544		appointed by the Governor shall serve at the pleasure of the
1409	2545		Governor. Each appointed member insurer representative may
1410	2546		designate an alternate representative to represent the insurer at
1411	2547		any meeting of the board. Any person serving as an alternate
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1412	2574		representative shall, while serving, have all the powers and
1413	2575		responsibilities of the appointed in surer representative. The
1414	2576		members of the board of directors except for the ex officio members
1415	2577		shall be subject to approval by the Insurance Commissioner.
1416	2578		Vacancies on the board except for the ex officio members shall be
1417	2579		filled for the remaining period of the term by a majority vote of
1418	2580		the remaining board members, subject to the approval of the
1419	2581		Commissioner. If no members are selected and appointed within sixty
1420	2582		(60) days after the effective date of this act, the Commissioner may
1421	2583		appoint the initial member s of the board of directors .
1422		-
1423	2584		B. In approving selections to the board, the Commissioner shall
1424	2585		consider, among other things, whether all member insurers are fairly
1425	2586		represented.
1426		-
1427	2587		C. Members of the board shall serve without compensation but
1428	2588		may be reimbursed from the assets of the Association for expenses
1429	2589		incurred by them as members of the board of directors.
1430		-
1431		-	SECTION 15. AMENDATORY 36 O.S. 2011, Section 2007, is
	2590	+	SECTION 16. AMENDATORY 36 O.S. 2011, Section 2007, is
1432	2591		amended to read as follows:
1433		-
1434	2592		Section 2007. A. The Oklahoma Property and C asualty Insurance
1435	2593		Guaranty Association shall:
1436		-
1437	2594		1. Be obligated to pay the covered claims existing prior to the
1438	2595		determination of insolvency if the claims arise within thirty (30)
1439	2596		days after the determination of insolvency, or before the policy
1440	2597		expiration date if less than thirty (30) days after the
	2598	+
	2599	+	ENGR. S. B. NO. 887 Page 49 1
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1441	2624		determination, or before the insured replaces the policy or causes
1442	2625		its cancellation, if the insured does so within thirty (30) days of
1443	2626		the determination. The obligation shall be satisfied by paying to
1444	2627		the claimant an amount as follows:
1445		-
1446		-
1447		-	ENR. S. B. NO. 887 Page 34
1448	2628		a. the full amount of a covered claim for benefits under
1449	2629		a workers' compensation insurance coverage,
1450		-
1451	2630		b. an amount not exceeding Ten Thousand Dollars
1452	2631		($10,000.00) per policy for a covered claim for the
1453	2632		return of unearned premium, and
1454		-
1455	2633		c. an amount not exceeding One Hundred Fifty Thousand
1456	2634		Dollars ($150,000.00) per claimant for all other
1457	2635		covered claims.
1458		-
1459	2636		In no event shall the Association be obligated to pay a claimant
1460	2637		an amount in excess of the obligation of the insolvent insurer under
1461	2638		the policy or coverage from which the claim arises or in excess of
1462	2639		the limits of the obligation of the Association existing on the date
1463	2640		on which the order of liquidation is filed with the court clerk;
1464		-
1465	2641		2. Any obligation of the association to defend an insure d shall
1466	2642		cease upon the payment or tender by the association of an amount
1467	2643		equal to the lesser of the covered claim obligation limit of the
1468	2644		association or the applicable policy limit;
1469		-
1470	2645		3. Be deemed the insurer to the extent of the obligations on
1471	2646		covered claims and to that extent subject to the limitations
1472	2647		provided in the Oklahoma Property and Casualty Insurance Guaranty
	2648	+
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1473	2674		Association Act shall As payor of last resort, have all rights,
1474	2675		duties and obligations of the insolvent insurer as if the insurer
1475	2676		had not become insolvent, including, but not limited to, the right
1476	2677		to pursue and retain salvage and subrogation recoverable on covered
1477	2678		claim obligations to the extent paid by the association. The
1478	2679		association shall not be deemed the insolvent insurer for the
1479	2680		purpose of conferring jurisdiction;
1480		-
1481	2681		4. Allocate claims paid and expenses incurred among the three
1482	2682		accounts set out in Section 2005 of this title separately, and
1483	2683		assess member insurers separately for each account amounts necessary
1484	2684		to pay the obligations of the Ass ociation under this section
1485	2685		subsequent to a member insurer becoming an insolvent insurer, the
1486	2686		expenses of handling covered claims subsequent to an insolvency, and
1487	2687		other expenses authorized by the Oklahoma Property and Casualty
1488	2688		Insurance Guaranty Associatio n Act, Sections 2001 through 2020 of
1489	2689		this title and Sections 14 2020.1 and 15 2020.2 of this act title.
1490		-
1491		-	ENR. S. B. NO. 887 Page 35
1492	2690		The assessments of each member insurer shall be in the proportion
1493	2691		that the net direct written premiums of the member insurer for the
1494	2692		calendar year preceding the assessment on the kinds of insurance in
1495	2693		the account bear to the net direct written premiums of all
1496	2694		participating insurers for the calendar year preceding the
1497	2695		assessment on the kinds of insurance in the account. Each member
1498	2696		insurer shall be notif ied in writing of the assessment not later
1499	2697		than thirty (30) days before it is due. No member insurer may be
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1500	2724		assessed in any year an amount greater than two percent (2%) of the
1501	2725		net direct written premiums of that member or one percent (1%) of
1502	2726		that surplus of the member insurer as regards policyholders for the
1503	2727		calendar year preceding the assessment on the kinds of insurance in
1504	2728		the account, whichever is less. If the maximum assessment, together
1505	2729		with the other assets of the Association, does not provide in an y
1506	2730		one (1) year in any account an amount sufficient to make all
1507	2731		necessary payments from that account, the funds available may be
1508	2732		prorated and the unpaid portion shall be paid as soon thereafter as
1509	2733		funds become available. The Association shall pay claims in any
1510	2734		order which it deems reasonable, including the payment of claims as
1511	2735		the claims are received from the claimants or in groups or
1512	2736		categories of claims. The Association may exempt or defer, in whole
1513	2737		or in part, the assessment of any member insurer, if th e assessment
1514	2738		would cause the financial statement of the member insurer to reflect
1515	2739		amounts of capital or surplus less than the minimum amounts required
1516	2740		for a certificate of authority by any jurisdiction in which the
1517	2741		member insurer is authorized to transact insurance. During the
1518	2742		period of deferment, no dividends shall be paid to shareholders or
1519	2743		policyholders. Deferred assessments shall be paid when the payments
1520	2744		will not reduce capital or surplus below required minimums. The
1521	2745		payments may be refunded to thos e companies receiving larger
1522	2746		assessments by virtue of the deferment, or, at the election of any
1523	2747		company credited against future assessments. Each member insurer
	2748	+
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	2773	+
1524	2774		serving as a servicing facility may set off against any assessment
1525	2775		authorized payments made on covered claims and expenses incurred in
1526	2776		the payment of covered claims by a member insurer if they are
1527	2777		chargeable to the account for which the assessment is made;
1528		-
1529	2778		5. Investigate claims brought against the Association and
1530	2779		adjust, compromise, settle and pay covered claims to the extent of
1531	2780		the obligation of the Association and deny all other claims. The
1532	2781		Association shall pay claims in any order that it may deem
1533	2782		reasonable, including, but not limited to, the payment of claims as
1534		-
1535		-	ENR. S. B. NO. 887 Page 36
1536	2783		they are received from claiman ts or in groups of categories of
1537	2784		claims. The Association shall have the right to select and to
1538	2785		direct legal counsel under liability insurance policies for the
1539	2786		defense of covered claims;
1540		-
1541	2787		6. Notify claimants in this state as deemed necessary by the
1542	2788		Commissioner and upon the request of the Commissioner, to the extent
1543	2789		records are available to the Association . Notification may include,
1544	2790		but shall not be limited to, a legal posting on the website of the
1545	2791		Association;
1546		-
1547	2792		7. a. Handle claims through employees or thro ugh one or more
1548	2793		insurers or other persons incorporated and resident in
1549	2794		the State of Oklahoma designated as servicing
1550	2795		facilities. Designation of a servicing facility is
1551	2796		subject to approval of the Commissioner, but such
1552	2797		designation may be declined by a memb er insurer.
	2798	+
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1553	2823
1554	2824		b. The Association shall have the right to review and
1555	2825		contest as set forth in this paragraph, settlements,
1556	2826		releases, compromises, waivers and judgments to which
1557	2827		the insolvent insurer or its insureds were parties
1558	2828		prior to the entry of the order of liquidation. In an
1559	2829		action to enforce settlements, releases and judgments
1560	2830		to which the insolvent insurer or its insureds were
1561	2831		parties prior to the entry of the order of
1562	2832		liquidation, the Association shall have the right to
1563	2833		assert the following defenses:
1564		-
1565	2834		(1) the Association shall not be bound by a
1566	2835		settlement, release, compromise or waiver
1567	2836		executed by an insured or the insurer, or any
1568	2837		judgment entered against the insured or the
1569	2838		insurer by consent or through a failure to
1570	2839		exhaust all appeals, if the settlemen t, release,
1571	2840		compromise waiver or judgment was:
1572		-
1573	2841		(a) executed or entered within one hundred
1574	2842		twenty (120) days prior to the entry of an
1575	2843		order of liquidation, and the insured or the
1576	2844		insurer did not use reasonable care in
1577	2845		entering into the settlement, release,
1578		-
1579		-	ENR. S. B. NO. 887 Page 37
1580	2846		compromise, waiver or judgment, or did not
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	2872	+
1581	2873		pursue all reasonable appeals of an adverse
1582	2874		judgment, or
1583		-
1584	2875		(b) executed by or taken against an insured or
1585	2876		the insurer based on default, fraud,
1586	2877		collusion or the failure of the insurer to
1587	2878		defend,
1588		-
1589	2879		(2) if a court of competent jurisdiction finds that
1590	2880		the Association is not bound by a settlement,
1591	2881		release, compromise, waiver or judgment for the
1592	2882		releases provided for in division (1) of
1593	2883		subparagraph b of this paragraph, the settlement,
1594	2884		release, compromise, waiver or judgment shall be
1595	2885		set aside and the Association shall be permitted
1596	2886		to defend any covered claim on the merits. The
1597	2887		settlement, release, compromise, waiver or
1598	2888		judgment shall not be considered as evidence of
1599	2889		liability in connection with any claim brought
1600	2890		against the Association or any other party
1601	2891		pursuant to the Oklahoma Property and Casualty
1602	2892		Insurance Guaranty Association Act, and
1603		-
1604	2893		(3) the Association shall have the right to assert
1605	2894		any statutory defenses or rights of offset
1606	2895		against any settlement, release, compromise or
1607	2896		waiver executed by an insured or the insurer, or
	2897	+
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	2922	+
1608	2923		any judgment taken against the insured or the
1609	2924		insurer.
1610		-
1611	2925		c. As to any covered claims arising from a judgment under
1612	2926		any decision, verdict or finding based on the default
1613	2927		of the insolvent insurer or its failu re to defend, the
1614	2928		Association, either on its own behalf or on behalf of
1615	2929		an insured, may apply to have the judgment, order,
1616	2930		decision, verdict or finding set aside by the same
1617	2931		court or administrator that entered the judgment,
1618	2932		claim, decision, verdict or find ing and shall be
1619	2933		permitted to defend on the merits;
1620		-
1621		-
1622		-	ENR. S. B. NO. 887 Page 38
1623	2934		8. Reimburse each servicing facility for obligations of the
1624	2935		Association paid by the facility and for reasonable expenses
1625	2936		incurred by the facility while handling claims on behalf of the
1626	2937		Association and pay the other expenses of the Association authorized
1627	2938		by the Oklahoma Property and Casualty Insurance Guaranty Association
1628	2939		Act; and
1629		-
1630	2940		9. Have standing to appear before any court of this state which
1631	2941		has jurisdiction over an impaired or insolvent insurer for who m the
1632	2942		Association is or may become obligated pursuant to the provisions of
1633	2943		the Oklahoma Property and Casualty Insurance Guaranty Association
1634	2944		Act. Standing shall extend to all matters germane to the powers and
1635	2945		duties of the Association including, but not l imited to, proposals
1636	2946		for rehabilitation, acquisition, merger, reinsuring, or guaranteeing
	2947	+
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	2972	+
1637	2973		the covered policies of the impaired or insolvent insurer, and the
1638	2974		determination of covered policies and contractual obligations of the
1639	2975		impaired or insolvent insurer ; and
1640		-
1641	2976		10. Notwithstanding any other provision of the Oklahoma
1642	2977		Property and Casualty Insurance Guaranty Association Act , an
1643	2978		insurance policy issued by a member insurer and later allocated,
1644	2979		transferred, assumed by or otherwise made the sole responsibility of
1645	2980		another insurer pursuant to any provision of law providing for the
1646	2981		division of an insurance company, or the statutory assumption or
1647	2982		transfer of designated policies under which there is no remaining
1648	2983		obligation to the transferring entity, shall be considere d to have
1649	2984		been issued by a member insurer which is an insolvent insurer for
1650	2985		the purposes of this Act in the event that the insurer to which the
1651	2986		policy has been allocated, transferred, assumed or otherwise made
1652	2987		the sole responsibility of is placed in liquid ation. An insurance
1653	2988		policy that was issued by an insurer who is not a member insurer and
1654	2989		subsequently allocated, transferred, assumed by or otherwise made
1655	2990		the sole responsibility of a member insurer under any provision of
1656	2991		law providing for the division of an insurance company shall not be
1657	2992		considered to have been issued by a member insurer pursuant to this
1658	2993		Act.
1659		-
1660	2994		B. The Association may:
1661		-
1662	2995		1. Employ or retain persons as are necessary to handle claims
1663	2996		and perform other duties of the Association;
1664	2997
1665		-
1666		-	ENR. S. B. NO. 887 Page 39
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	3022	+
1667	3023		2. Borrow funds necessary to effect the purposes of the
1668	3024		Oklahoma Property and Casualty Insurance Guaranty Association Act in
1669	3025		accordance with the plan of operation;
1670		-
1671	3026		3. Sue or be sued;
1672		-
1673	3027		4. Negotiate and become a party to contracts as are necessary
1674	3028		to carry out the purpos e of the Oklahoma Property and Casualty
1675	3029		Insurance Guaranty Association Act;
1676		-
1677	3030		5. Refund to member insurers in proportion to the contribution
1678	3031		of each member insurer that amount by which the assets of the
1679	3032		Association exceed its liabilities, if at the end of a ny calendar
1680	3033		year the board of directors finds that the assets of the Association
1681	3034		exceed the liabilities as estimated by the board of directors for
1682	3035		the coming year;
1683		-
1684	3036		6. Lend monies to an insurer declared to be impaired by the
1685	3037		Commissioner. The Association, with approval of the Commissioner,
1686	3038		shall approve the amount, length and terms of the loan. "Impaired
1687	3039		Insurer" for purposes of this paragraph section shall mean an
1688	3040		insurer potentially unable to fulfill its contractual obligations,
1689	3041		but shall not mean an in solvent insurer;
1690		-
1691	3042		7. Perform other acts as are necessary or proper to effectuate
1692	3043		the purpose of the Oklahoma Property and Casualty Insurance Guaranty
1693	3044		Association Act;
1694		-
1695	3045		8. Intervene as a party in interest in any supervision,
1696	3046		conservation, liquidation, rehab ilitation, impairment or
	3047	+
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	3072	+
1697	3073		receivership in which policyholders ' interests and interests of the
1698	3074		Association may be or are affected; and
1699		-
1700	3075		9. Be designated or may contract as a servicing facility for
1701	3076		any entity which may be recommended by the board of directors of the
1702	3077		Association and shall be approved by the Commissioner.
1703		-
1704		-	SECTION 16. AMENDATORY 36 O.S. 2011, Section 2008, is
	3078	+	SECTION 17. AMENDATORY 36 O.S. 2011, Section 2008, is
1705	3079		amended to read as follows:
1706		-
1707	3080		Section 2008. A. The Oklahoma Property and Casualty Insurance
1708	3081		Guaranty Association s hall submit to the Commissioner a plan of
1709		-
1710		-	ENR. S. B. NO. 887 Page 40
1711	3082		operation and any amendments thereto necessary or suitable to assure
1712	3083		the fair, reasonable and equitable administration of the
1713	3084		Association. The plan of operation and any amendments thereto shall
1714	3085		become effective upon approval in writing by the Commissioner.
1715		-
1716	3086		B. If the Association fails to submit a suitable plan of
1717	3087		operation within ninety (90) days following the effective date of
1718	3088		this act June 27, 1980, or if at any time thereafter the Association
1719	3089		fails to submit suitable amendments to the plan, the Commissioner
1720	3090		shall, after notice and hearing, adopt and promulgate reasonable
1721	3091		rules as are necessary or advisable to effectuate the provisions of
1722	3092		this act Section 2001 et seq. of this title . Any rules promulgated
1723	3093		shall continue in force until modified by the Commissioner or
1724	3094		superseded by a plan submitted by the Association and approved by
1725	3095		the Commissioner. All member insurers shall comply with the plan of
1726	3096		operation.
1727	3097
	3098	+	ENGR. S. B. NO. 887 Page 59 1
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	3122	+
1728	3123		C. The plan of operation shall:
1729		-
1730	3124		1. Establish the proce dures whereby all the powers and duties
1731	3125		of the Association under this act will be performed;
1732		-
1733	3126		2. Establish procedures for handling assets of the Association;
1734		-
1735	3127		3. Require the amount and method of reimbursing members of the
1736	3128		board of directors under Section 2 006 of this title;
1737		-
1738	3129		4. Establish procedures by which claims may be filed with the
1739	3130		Association and establish acceptable forms of proof of covered
1740	3131		claims;
1741		-
1742	3132		5. Establish regular places and times for meetings of the board
1743	3133		of directors;
1744		-
1745	3134		6. Require that the wri tten procedures be established for
1746	3135		records to be kept of all financial transactions of the Association,
1747	3136		its agents and the board of directors;
1748		-
1749	3137		7. Provide that any member insurer aggrieved by any final
1750	3138		action or decision of the Association may appeal to th e Commissioner
1751	3139		within thirty (30) days after the action or decision;
1752		-
1753		-
1754		-	ENR. S. B. NO. 887 Page 41
1755	3140		8. Establish the procedures whereby selections for the board of
1756	3141		directors will be submitted to the Commissioner; and
1757		-
1758	3142		9. Contain additional provisions necessary or proper for the
1759	3143		execution of the powers and duties of the Association.
1760		-
1761	3144		D. The plan of operation may provide that any or all powers and
1762	3145		duties of the Association, except those under paragraph 3 of
1763	3146		subsection A and paragraph 2 of subsection B of Section 2007 of this
	3147	+
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	3172	+
1764	3173		title, are delegated to a corporation, association or other
1765	3174		organization incorporated and resident in the State of Oklahoma
1766	3175		which performs or will perform functions similar to those of this
1767	3176		Association, or its equivalent. The corporation, association or
1768	3177		organization shall be reimbursed as a servicing facility would be
1769	3178		reimbursed and shall be paid for its performance of any other
1770	3179		functions of the Association. A delegation under this subsection
1771	3180		shall take effect only with the approval of both the board of
1772	3181		directors and the Commissioner, and may be made only to a
1773	3182		corporation, association or organization which extends protection
1774	3183		not substantially less favorable and effective than that provided by
1775	3184		this act Section 2001 et seq. of this title .
1776		-
1777		-	SECTION 17. AMENDATORY 36 O.S. 2011, Section 2023, as
	3185	+	SECTION 18. AMENDATORY 36 O.S. 2011, Section 2023, as
1778	3186		amended by Section 2, Chapter 384, O.S.L. 2019 (36 O.S. Supp. 2020,
1779	3187		Section 2023), is amended to read as follows:
1780		-
1781	3188		Section 2023. A. There is created a nonprofit legal entity to
1782	3189		be known as the Oklahoma Life a nd Health Insurance Guaranty
1783	3190		Association. All member insurers shall be and remain members of the
1784	3191		Association as a condition of their authority to transact insurance
1785	3192		as a or health maintenance organization business in this state.
1786		-
1787	3193		B. The Association shall perform its functions under a plan of
1788	3194		operation established and approved in accordance with this act and
1789	3195		shall exercise its powers through the Board of Directors established
	3196	+
	3197	+	ENGR. S. B. NO. 887 Page 61 1
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	3221	+
1790	3222		in this act. For purposes of administration and assessment, the
1791	3223		Association shall maintain three accounts:
1792		-
1793	3224		1. The health account;
1794		-
1795	3225		2. The life insurance account; and
1796		-
1797		-
1798		-	ENR. S. B. NO. 887 Page 42
1799	3226		3. The annuity account.
1800		-
1801	3227		C. The Association shall come under the immediate supervision
1802	3228		of the Insurance Commissioner and shall be subject to the applicable
1803	3229		provisions of the insurance laws of this state.
1804		-
1805		-	SECTION 18. AMENDATORY 36 O.S. 2011, Section 3101, is
	3230	+	SECTION 19. AMENDATORY 36 O.S. 2011, Section 3101, is
1806	3231		amended to read as follows:
1807		-
1808	3232		Section 3101. The words and phrases as As used in this act,
1809	3233		unless a different meaning is plainly required by the context, shall
1810	3234		have the following meanings :
1811		-
1812	3235		1. "Commissioner" means the Commissioner of Insurance, his or
1813	3236		her assistants or deputies, or other persons authorized to act for
1814	3237		him. or her;
1815		-
1816	3238		2. "Company" means any person, firm, copartnership, company,
1817	3239		association or corporation engaged in selling, furnishing or
1818	3240		procuring, either as principal or agent producer, for a
1819	3241		consideration, motor club service .;
1820		-
1821	3242		3. "Agent" "Producer" means a limited insurance representative
1822	3243		who solicits the purchase of service contract s or transmits for
1823	3244		another any such contract, or application therefor, to or from the
1824	3245		company, or acts or aids in any manner in the delivery or
	3246	+
	3247	+	ENGR. S. B. NO. 887 Page 62 1
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	3271	+
1825	3272		negotiation of any such contract, or in the renewal or continuance
1826	3273		thereof. This, however, shall not include an y person performing
1827	3274		only work of a clerical nature in the office of the motor club .;
1828		-
1829	3275		4. "Towing service" means any act by a company which consists
1830	3276		of towing or moving a motor vehicle from one place to another under
1831	3277		other than its own power .;
1832		-
1833	3278		5. "Emergency road service" means any act by a company to
1834	3279		adjust, repair or replace the equipment, tires or mechanical parts
1835	3280		of a motor vehicle so it may operate under its own power; or
1836	3281		reimbursement of expenses incurred by a member when his or her motor
1837	3282		vehicle is unable to operate under its own power .;
1838		-
1839	3283		6. "Insurance service" means any act to sell or give to the
1840	3284		holder of a service contract or as a result of membership in or
1841		-
1842		-	ENR. S. B. NO. 887 Page 43
1843	3285		affiliation with a company a policy of insurance covering the holder
1844	3286		for liability or loss fo r personal injury or property damage
1845	3287		resulting from the ownership, maintenance, operation or use of a
1846	3288		motor vehicle.;
1847		-
1848	3289		7. "Bail bond service" means any act by a company to furnish or
1849	3290		procure a cash deposit, bond or other undertaking required by law
1850	3291		for any person accused of a law violation of this state, pending the
1851	3292		trial.;
1852		-
1853	3293		8. "Discount service" means any act by a company resulting in
1854	3294		special discounts, rebates or reductions of price on gasoline, oil,
	3295	+
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	3318	+	23
	3319	+	24
	3320	+
1855	3321		repairs, insurance, parts, accessories or service for m otor vehicles
1856	3322		to holders of service contracts .;
1857		-
1858	3323		9. "Financial service" means any act by a company to loan or
1859	3324		otherwise advance monies, with or without security, to a service
1860	3325		contract holder.;
1861		-
1862	3326		10. "Buying and selling service" means any act by a company to
1863	3327		aid the holder of a service contract in the purchase or sale of an
1864	3328		automobile.;
1865		-
1866	3329		11. "Theft service" means any act by a company to locate,
1867	3330		identify or recover a stolen or missing motor vehicle owned or
1868	3331		controlled by the holder of a service contract or to detect or
1869	3332		apprehend the person guilty of such theft .;
1870		-
1871	3333		12. "Map service" means any act by a company to furnish road
1872	3334		maps without cost to holders of service contracts .;
1873		-
1874	3335		13. "Touring service" means any act by a company to furnish
1875	3336		touring information without cost to holders of service contracts .;
1876		-
1877	3337		14. "Legal service" means any act by a company to furnish to a
1878	3338		service contract holder, without cost, the services of an attorney .;
1879		-
1880	3339		15. "Motor club service" means the rendering, furnishing or
1881	3340		procuring of, or reimb ursement for, towing service, emergency road
1882	3341		service, insurance service, bail bond service, legal service,
1883	3342		discount service, financial service, buying and selling service,
1884	3343		theft service, map service, touring service, or any three or more
1885		-
1886		-	ENR. S. B. NO. 887 Page 44
1887	3344		thereof, to any person, in connection with the ownership, operation,
	3345	+
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	3370	+
1888	3371		use or maintenance of a motor vehicle by such person , that has
1889	3372		membership, for consideration.; and
1890		-
1891	3373		16. "Service contract" means any written agreement whereby any
1892	3374		company, for a consideration, promises to render, furnish or procure
1893	3375		for any person motor club service.
1894		-
1895		-	SECTION 19. AMENDATORY 36 O.S. 2011, Section 3105, is
	3376	+	SECTION 20. AMENDATORY 36 O.S. 2011, Section 3105, is
1896	3377		amended to read as follows:
1897		-
1898	3378		Section 3105. A. Each motor service club operating in this
1899	3379		state pursuant to certific ate of authority issued hereunder shall
1900	3380		file with the Commissioner, within ten (10) days of the date of
1901	3381		employment, a notice of appointment of any agent limited lines
1902	3382		producer, resident or nonresident, appointed by the automobile club
1903	3383		to sell memberships i n the motor service club to the public. This
1904	3384		notification shall be upon such form as the Commissioner may
1905	3385		prescribe and shall contain the name, address, age, sex, and Social
1906	3386		Security number of such club agent producer, and shall also contain
1907	3387		proof satisfactory to the Commissioner that such applicant is not
1908	3388		less than eighteen (18) years of age, is of good reputation, and has
1909	3389		received training from the club or is otherwise qualified in the
1910	3390		field of motor service club service contracts and knowledgeable of
1911	3391		the laws of this state pertaining thereto . Upon termination of any
1912	3392		agent's employment by the motor service club, such motor service
1913	3393		club shall notify the Commissioner, in writing, within five (5) days
1914	3394		of such termination.
1915	3395
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	3420	+
1916	3421		B. A registration licensing fee for agents limited lines
1917	3422		producers, resident or nonresident, shall be Twenty Dollars ($20.00)
1918	3423		annually, and such registration shall expire on July 1 of each year
1919	3424		unless sooner revoked or suspended as provided for in this section
1920	3425		Forty Dollars ($40.00) bienni ally.
1921		-
1922	3426		C. Upon notice and hearing, the Commissioner may suspend for
1923	3427		not over twelve (12) months , censure, revoke, or refuse to renew any
1924	3428		agent's license of a producer if he finds as to the licensee that
1925	3429		any one or more of the following causes exist:
1926		-
1927	3430		1. Any violation of or noncompliance with any provision of this
1928	3431		act;
1929		-
1930		-	ENR. S. B. NO. 887 Page 45
1931		-
1932	3432		2. Obtaining or attempting to obtain any such license through
1933	3433		misrepresentation or fraud;
1934		-
1935	3434		3. Oral or written misrepresentation of the terms, conditions,
1936	3435		benefits, or privileges of any motor service club service contract
1937	3436		issued or to be issued by the motor service club he represents or
1938	3437		any other motor service club;
1939		-
1940	3438		4. Misappropriation or conversion to his own use or illegal
1941	3439		holding of monies, belonging to members or others, received in the
1942	3440		conduct of business under his license;
1943		-
1944	3441		5. Pleading nolo contendere or guilty to a felony or conviction
1945	3442		by final judgment of a felony;
	3443	+
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1946	3468
1947	3469		6. Demonstration of incompetence sufficient in the opinion of
1948	3470		the Commissioner to make the agent producer a source of injury and
1949	3471		loss to the public;
1950		-
1951	3472		7. Fraudulent or dishonest practices;
1952		-
1953	3473		8. Willful solicitation of membership from an individual who is
1954	3474		or has been a member of another motor service club by giving said
1955	3475		person credit for his years of membership with the other mo tor
1956	3476		service club;
1957		-
1958	3477		9. Waiving the enrollment fee or otherwise reducing the usual
1959	3478		fees and charges for a new member when soliciting membership from an
1960	3479		individual who is or has been a member of another motor service
1961	3480		club.
1962		-
1963	3481		D. In addition to the penalties pro vided for in this section, a
1964	3482		fine of not less than One Hundred Dollars ($100.00) nor more than
1965	3483		One Thousand Dollars ($1,000.00) for each occurrence may be levied.
1966		-
1967		-	SECTION 20. AMENDATORY 36 O.S. 2011, Section 3108, is
	3484	+	SECTION 21. AMENDATORY 36 O.S. 2011, Section 3108, is
1968	3485		amended to read as follows:
1969		-
1970	3486		Section 3108. A motor service club or an officer or agent
1971	3487		producer thereof shall not in any manner misrepresent the terms,
1972		-
1973		-	ENR. S. B. NO. 887 Page 46
1974	3488		benefits or privileges of any service contract issued or to be
1975	3489		issued by it or by another motor service club.
1976		-
1977		-	SECTION 21. AMENDATORY 36 O.S. 2 011, Section 3639.1, as
	3490	+	SECTION 22. AMENDATORY 36 O.S. 2011, Section 3639.1, as
1978	3491		amended by Section 11, Chapter 44, O.S.L. 2012 (36 O.S. Supp. 2020,
1979	3492		Section 3639.1), is amended to read as follows:
	3493	+
	3494	+	ENGR. S. B. NO. 887 Page 67 1
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1980	3518
1981	3519		Section 3639.1. A. No insurer shall cancel, refuse to renew or
1982	3520		increase the premium of a homeowner's insurance policy or any other
1983	3521		personal residential insurance coverage, which has been in effect
1984	3522		more than forty-five (45) days, solely because the insured filed a
1985	3523		first claim against the policy. The provisions of this s ection
1986	3524		shall not be construed to prevent the cancellation, nonrenewal or
1987	3525		increase in premium of a homeowner's insurance policy for the
1988	3526		following reasons:
1989		-
1990	3527		1. Nonpayment of premium;
1991		-
1992	3528		2. Discovery of fraud or material misrepresentation in the
1993	3529		procurement of the insurance or with respect to any claims submitted
1994	3530		thereunder;
1995		-
1996	3531		3. Discovery of willful or reckless acts or omissions on the
1997	3532		part of the named insured which increase any hazard insured against;
1998		-
1999	3533		4. A change in the risk which substantially increases any
2000	3534		hazard insured against after insurance coverage has been issued or
2001	3535		renewed;
2002		-
2003	3536		5. Violation of any local fire, health, safety, building, or
2004	3537		construction regulation or ordinance with respect to any insured
2005	3538		property or the occupancy thereof which substantially increases any
2006	3539		hazard insured against;
2007		-
2008	3540		6. A determination by the Insurance Commissioner that the
2009	3541		continuation of the policy would place the insurer in violation of
2010	3542		the insurance laws of this state; or
2011	3543
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2012	3569		7. Conviction of the named insured of a crime having as one of
2013	3570		its necessary elements an act increasing any hazard insured against.
2014		-
2015		-
2016		-	ENR. S. B. NO. 887 Page 47
2017	3571		B. An insurer shall give to the named insured at the mailing
2018	3572		address shown on a homeowner's policy, a written renewal notice that
2019	3573		shall include new premium, new deductible, new limits or coverage at
2020	3574		least thirty (30) days prior to the expiration date of the policy.
2021	3575		If the insurer fails to provide such notice, the premium,
2022	3576		deductible, limits and coverage provided to the named insurer prior
2023	3577		to the change shall remain in effect un til notice is given or until
2024	3578		the effective date of replacement coverage obtained by the named
2025	3579		insured, whichever occurs first. If notice is given by mail, the
2026	3580		notice shall be deemed to have been given on the day the notice is
2027	3581		mailed. If the insured elect s not to renew, any earned premium for
2028	3582		the period of extension of the terminated policy shall be calculated
2029	3583		pro rata at the lower of the current or previous year's rate. If
2030	3584		the insured accepts the renewal, the premium increase, if any, and
2031	3585		other changes shall be effective the day following the prior
2032	3586		policy's expiration or anniversary date.
2033		-
2034	3587		C. In the event an insured cancels a homeowner's insurance
2035		-	policy or any other per sonal residential insurance cove rage, written
2036		-	notice shall be provided by the insured to the insurer that p rovided
2037		-	the coverage being canceled. The notice of cancellation shall
2038		-	provide the date of the can cellation of the policy and the insurer
2039		-	shall reimburse the insured for any premiums paid for coverage
2040		-	beyond the date of cancellation of the policy.
	3588	+	policy or any other personal residential insurance coverage, notice
	3589	+	shall be provided to the prior insurer an d shall include the date of
	3590	+	the policy cancellation and the date of policy inception of the new
	3591	+	policy.
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2041	3617
2042	3618		D. An insurer canceling a policy under subsection C of this
2043	3619		section shall not be liable for claims arising after the date of
2044	3620		cancellation.
2045		-
2046		-	SECTION 22. AMENDATORY 36 O.S. 2011, Section 4030, is
	3621	+	SECTION 23. AMENDATORY 36 O.S. 2011, Section 4030, is
2047	3622		amended to read as follows:
2048		-
2049	3623		Section 4030. A. Except as may be otherwise approved by the
2050	3624		Insurance Commissioner, no single premium policy of life insurance
2051	3625		or single premium annuity contra ct shall be delivered or issued for
2052	3626		delivery in Oklahoma for a consideration other than cash, cashier's
2053	3627		check, check, bank draft, money order, or premium note or electronic
2054	3628		payment. This act shall not apply to the transfer of securities to
2055	3629		an insurer pursuant to the insuring of a pension or profit sharing
2056	3630		plan qualified under the Federal Internal Revenue Code.
2057		-
2058		-
2059		-	ENR. S. B. NO. 887 Page 48
2060	3631		B. This act shall not be held to repeal or alter any law now in
2061	3632		effect, but shall be construed as cumulative with and supplemental
2062	3633		to other laws and acts now in effect or enacted hereafter.
2063		-
2064		-	SECTION 23. AMENDATORY 36 O.S. 2011, Section 4030.1, is
	3634	+	SECTION 24. AMENDATORY 36 O.S. 2011, Section 4030.1, is
2065	3635		amended to read as follows:
2066		-
2067	3636		Section 4030.1. A. Within ten (10) days after an insurer
2068	3637		receives written notification of the death of a person covered by a
2069	3638		policy of life insurance, the insurer shall provide to the claimant
2070	3639		the necessary forms to be completed to establish proof of the death
2071	3640		of the insured and, if required by the policy, the interest of the
2072	3641		claimant. If the policy conta ins a provision requiring surrender of
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2073	3668		the policy prior to settlement, the insurer shall include a written
2074	3669		statement to that effect with the forms to be completed. Forms to
2075	3670		establish proof of death and proof of the interest of the claimant
2076	3671		shall be approved by the Insurance Commissioner.
2077		-
2078	3672		B. An insurer shall pay the proceeds of any benefits under a
2079	3673		policy of life insurance not more than thirty (30) days after the
2080	3674		insurer has received proof of death of the insured. If the proceeds
2081	3675		are not paid within this period, the insurer shall pay interest on
2082	3676		the proceeds, at a rate which is not less than the current rate of
2083	3677		interest on death proceeds on deposit with the insurer, from the
2084	3678		date of death of the insured to the date when the proceeds are paid.
2085	3679		Should the insurer hold its deposits in a noninterest bearing
2086	3680		account, the rate of interest to be paid shall be the same rate of
2087	3681		interest as the average United States Treasury Bill rate of the
2088	3682		preceding calendar year, as certified to the Insurance Commissioner
2089	3683		by the State Treasurer on the first regular business day in January
2090	3684		of each year, plus two (2) percentage points, which shall accrue
2091	3685		from the thirty-first day after receipt of proof of loss until the
2092	3686		proceeds are paid. Payment shall be deemed to have been made o n the
2093	3687		date an electronic payment is made or the date a check, draft or
2094	3688		other valid instrument which is equivalent to payment was placed in
2095	3689		the U.S. mails in a properly addressed, postpaid envelope; or, if
2096	3690		not so posted, on the date of delivery of such inst rument to the
2097	3691		beneficiary.
2098	3692
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	3717	+
2099	3718		C. Subsection B of this section shall not apply to any life
2100	3719		insurance policy issued before October 1, 1978, which contains
2101	3720		specific provisions to the contrary.
2102		-
2103		-	ENR. S. B. NO. 887 Page 49
2104		-
2105		-	SECTION 24. AMENDATORY 36 O.S. 2011, Section 4055.7, is
	3721	+	SECTION 25. AMENDATORY 36 O.S. 2011, Sectio n 4055.7, is
2106	3722		amended to read as follows:
2107		-
2108	3723		Section 4055.7. A. 1. The Insurance Commissioner may conduct
2109	3724		an examination under the Viatical Settlements Act of 2008 of a
2110	3725		licensee as often as the Commissioner in his or her discretion deems
2111	3726		appropriate after considering the factors set forth in this
2112	3727		paragraph. In scheduling and determining the nature, scope, and
2113	3728		frequency of the examinations, the Commissioner shall consider such
2114	3729		matters as the consumer complaints, results of financial statement
2115	3730		analyses and ratios, changes in management or ownership, actuarial
2116	3731		opinions, report of independent certified public accountants, and
2117	3732		other relevant criteria as determined by the Commissioner.
2118		-
2119	3733		2. For purposes of completing an examination of a licensee
2120	3734		under the Viatical Settlements Act of 2008, the Commissioner may
2121	3735		examine or investigate any person, or the business of any person,
2122	3736		insofar as the examination or investigation is, in the sole
2123	3737		discretion of the Commissioner, necessary or material to the
2124	3738		examination of the lice nsee.
2125		-
2126	3739		3. In lieu of an examination under the Viatical Settlements Act
2127	3740		of 2008 of any foreign or alien licensee licensed in this state, the
2128	3741		Commissioner may, at the Commissioner's discretion, accept an
	3742	+
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	3767	+
2129	3768		examination report on the licensee as prepared by the Commissioner
2130	3769		for the licensee's state of domicile or port -of-entry state.
2131		-
2132	3770		4. As far as practical, the examination of a foreign or alien
2133	3771		licensee shall be made in cooperation with the insurance supervisory
2134	3772		officials of other states in which the licensee tr ansacts business.
2135		-
2136	3773		B. 1. A person required to be licensed by the Viatical
2137	3774		Settlements Act of 2008 shall for five (5) years for all settled
2138	3775		policies and for two (2) years for all policies which are not
2139	3776		settled retain copies of all:
2140		-
2141	3777		a. proposed, offered or executed contracts, purchase
2142	3778		agreements, underwriting documents, policy forms, and
2143	3779		applications from the date of the proposal, offer or
2144	3780		execution of the contract or purchase agreement,
2145	3781		whichever is later,
2146		-
2147		-	ENR. S. B. NO. 887 Page 50
2148		-
2149	3782		b. all checks, drafts, electronic payment or other
2150	3783		evidence and documentation related to the payment,
2151	3784		transfer, deposit or release of funds from the date of
2152	3785		the transaction, and
2153		-
2154	3786		c. all other records and documents related to the
2155	3787		requirements of the Viatical Settlements Act of 2008.
2156		-
2157	3788		2. This subsection does not relieve a person of the obligation
2158	3789		to produce these documents to the Commissioner after the retention
2159	3790		period has expired if the person has retained the documents.
	3791	+
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2160	3816
2161	3817		3. Records required to be retained by this subsection must be
2162	3818		legible and complete and m ay be retained in paper, photograph,
2163	3819		microprocess, magnetic, mechanical, or electronic media, or by any
2164	3820		process that accurately reproduces or forms a durable medium for the
2165	3821		reproduction of a record.
2166		-
2167	3822		C. 1. Upon determining that an examination should be
2168	3823		conducted, the Commissioner shall issue an examination warrant
2169	3824		appointing one or more examiners to perform the examination and
2170	3825		instructing them as to the scope of the examination. In conducting
2171	3826		the examination, the examiner shall observe those guidelines an d
2172	3827		procedures set forth in the Examiners Handbook adopted by the
2173	3828		National Association of Insurance Commissioners (NAIC). The
2174	3829		Commissioner may also employ such other guidelines or procedures as
2175	3830		the Commissioner may deem appropriate.
2176		-
2177	3831		2. Every licensee or pe rson from whom information is sought,
2178	3832		its officers, directors and agents shall provide to the examiners
2179	3833		timely, convenient and free access at all reasonable hours at its
2180	3834		offices to all books, records, accounts, papers, documents, assets
2181	3835		and computer or other recordings relating to the property, assets,
2182	3836		business and affairs of the licensee being examined. The officers,
2183	3837		directors, employees and agents of the licensee or person shall
2184	3838		facilitate the examination and aid in the examination so far as it
2185	3839		is in their power to do so. The refusal of a licensee, by its
2186	3840		officers, directors, employees or agents, to submit to examination
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2187	3867		or to comply with any reasonable written request of the Commissioner
2188	3868		shall be grounds for suspension or refusal of, or nonrenewal of an y
2189	3869		license or authority held by the licensee to engage in the viatical
2190		-
2191		-	ENR. S. B. NO. 887 Page 51
2192	3870		settlement business or other business subject to the Commissioner's
2193	3871		jurisdiction. Any proceedings for suspension, revocation or refusal
2194	3872		of any license or authority shall be conducted in accordance with
2195	3873		the Administrative Procedures Act.
2196		-
2197	3874		3. The Commissioner shall have the power to issue subpoenas, to
2198	3875		administer oaths and to examine under oath any person as to any
2199	3876		matter pertinent to the examination. Upon the failure or refusal of
2200	3877		a person to obey a subpoena, the Commissioner may petition a court
2201	3878		of competent jurisdiction, and upon proper showing, the Court may
2202	3879		enter an order compelling the witness to appear and testify or
2203	3880		produce documentary evidence. Failure to obey the court order sha ll
2204	3881		be punishable as contempt of court.
2205		-
2206	3882		4. When making an examination under the Viatical Settlements
2207	3883		Act of 2008, the Commissioner may retain attorneys, appraisers,
2208	3884		independent actuaries, independent certified public accountants or
2209	3885		other professionals and specialists as examiners, the reasonable
2210	3886		cost of which shall be borne by the licensee that is the subject of
2211	3887		the examination.
2212		-
2213	3888		5. Nothing contained in the Viatical Settlements Act of 2008
2214	3889		shall be construed to limit the Commissioner's authority to
2215	3890		terminate or suspend an examination in order to pursue other legal
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2216	3917		or regulatory action pursuant to the insurance laws of this state.
2217	3918		Findings of fact and conclusions made pursuant to any examination
2218	3919		shall be prima facie evidence in any legal or regulatory action .
2219		-
2220	3920		6. Nothing contained in the Viatical Settlements Act of 2008
2221	3921		shall be construed to limit the Commissioner's authority to use and,
2222	3922		if appropriate, to make public any final or preliminary examination
2223	3923		report, any examiner or licensee workpapers or other do cuments, or
2224	3924		any other information discovered or developed during the course of
2225	3925		any examination in the furtherance of any legal or regulatory action
2226	3926		which the Commissioner may, in his or her sole discretion, deem
2227	3927		appropriate.
2228		-
2229	3928		D. 1. Examination reports sha ll be comprised of only facts
2230	3929		appearing upon the books, records or other documents of the
2231	3930		licensee, its agents or other persons examined, or as ascertained
2232	3931		from the testimony of its officers or agents or other persons
2233	3932		examined concerning its affairs, and s uch conclusions and
2234		-
2235		-	ENR. S. B. NO. 887 Page 52
2236	3933		recommendations as the examiners find reasonably warranted from the
2237	3934		facts.
2238		-
2239	3935		2. No later than sixty (60) days following completion of the
2240	3936		examination, the examiner in charge shall file with the Commissioner
2241	3937		a verified written report of e xamination under oath. Upon receipt
2242	3938		of the verified report, the Commissioner shall transmit the report
2243	3939		to the licensee examined, together with a notice that shall afford
2244	3940		the licensee examined a reasonable opportunity of not more than
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	3966	+
2245	3967		thirty (30) days to m ake a written submission or rebuttal with
2246	3968		respect to any matters contained in the examination report.
2247		-
2248	3969		3. In the event the Commissioner determines that regulatory
2249	3970		action is appropriate as a result of an examination, the
2250	3971		Commissioner may initiate any procee dings or actions provided by
2251	3972		law.
2252		-
2253	3973		E. 1. Names and individual identification data for all viators
2254	3974		shall be considered private and confidential information and shall
2255	3975		not be disclosed by the Commissioner, unless required by law.
2256		-
2257	3976		2. Except as otherwise prov ided in the Viatical Settlements Act
2258	3977		of 2008, all examination reports, working papers, recorded
2259	3978		information, documents and copies thereof produced by, obtained by
2260	3979		or disclosed to the Commissioner or any other person in the course
2261	3980		of an examination made und er the Viatical Settlements Act of 2008,
2262	3981		or in the course of analysis or investigation by the Commissioner of
2263	3982		the financial condition or market conduct of a licensee shall be
2264	3983		confidential by law and privileged, shall not be subject to the
2265	3984		Oklahoma Open Records Act, shall not be subject to subpoena, and
2266	3985		shall not be subject to discovery or admissible in evidence in any
2267	3986		private civil action. The Commissioner is authorized to use the
2268	3987		documents, materials or other information in the furtherance of any
2269	3988		regulatory or legal action brought as part of the Commissioner's
2270	3989		official duties.
2271	3990
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2272	4016		3. Documents, materials or other information, including, but
2273	4017		not limited to, all working papers, and copies thereof, in the
2274	4018		possession or control of the NAIC and its affiliates and
2275	4019		subsidiaries shall be confidential by law and privileged, shall not
2276	4020		be subject to subpoena, and shall not be subject to discovery or
2277	4021		admissible in evidence in any private civil action if they are:
2278		-
2279		-	ENR. S. B. NO. 887 Page 53
2280		-
2281	4022		a. created, produced or obtained by or disclosed to the
2282	4023		NAIC and its affiliates and subsidiaries in the course
2283	4024		of assisting an examination made under this act, or
2284	4025		assisting a Commissioner in the analysis or
2285	4026		investigation of the financial condition or market
2286	4027		conduct of a licensee, or
2287		-
2288	4028		b. disclosed to the NAIC and it s affiliates and
2289	4029		subsidiaries under paragraph 4 of this subsection by a
2290	4030		Commissioner.
2291		-
2292	4031		For the purposes of paragraph 2 of this subsection, "act" means
2293	4032		the law of another state or jurisdiction that is substantially
2294	4033		similar to the Viatical Settlements Act of 2008.
2295		-
2296	4034		4. Neither the Commissioner nor any person that received the
2297	4035		documents, material or other information while acting under the
2298	4036		authority of the Commissioner, including the NAIC and its affiliates
2299	4037		and subsidiaries, shall be permitted to testify in any private civil
2300	4038		action concerning any confidential documents, materials or
2301	4039		information subject to paragraph 1 of this subsection.
2302	4040
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2303	4066		5. In order to assist in the performance of the Commissioner's
2304	4067		duties, the Commissioner:
2305		-
2306	4068		a. may share documents, materials or o ther information,
2307	4069		including the confidential and privileged documents,
2308	4070		materials or information subject to paragraph 1 of
2309	4071		this subsection, with other state, federal and
2310	4072		international regulatory agencies, with the NAIC and
2311	4073		its affiliates and subsidiaries, a nd with state,
2312	4074		federal and international law enforcement authorities,
2313	4075		provided that the recipient agrees to maintain the
2314	4076		confidentiality and privileged status of the document,
2315	4077		material, communication or other information, and
2316		-
2317	4078		b. may receive documents, mate rials, communications or
2318	4079		information, including otherwise confidential and
2319	4080		privileged documents, materials or information, from
2320	4081		the NAIC and its affiliates and subsidiaries, and from
2321	4082		regulatory and law enforcement officials of other
2322		-
2323		-	ENR. S. B. NO. 887 Page 54
2324	4083		foreign or domestic jur isdictions, and shall maintain
2325	4084		as confidential or privileged any document, material
2326	4085		or information received with notice or the
2327	4086		understanding that it is confidential or privileged
2328	4087		under the laws of the jurisdiction that is the source
2329	4088		of the document, materi al or information.
2330	4089
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	4114	+
2331	4115		6. No waiver of any applicable privilege or claim of
2332	4116		confidentiality in the documents, materials or information shall
2333	4117		occur as a result of disclosure to the Commissioner under this
2334	4118		section or as a result of sharing as authorized in para graph 5 of
2335	4119		this subsection.
2336		-
2337	4120		7. A privilege established under the law of any state or
2338	4121		jurisdiction that is substantially similar to the privilege
2339	4122		established under this subsection shall be available and enforced in
2340	4123		any proceeding in, and in any court of, t his state.
2341		-
2342	4124		8. Nothing contained in the Viatical Settlements Act of 2008
2343	4125		shall prevent or be construed as prohibiting the Commissioner from
2344	4126		disclosing the content of an examination report, preliminary
2345	4127		examination report or results, or any matter relating t hereto, to
2346	4128		the Commissioner of any other state or country, or to law
2347	4129		enforcement officials of this or any other state or agency of the
2348	4130		federal government at any time or to the NAIC, so long as such
2349	4131		agency or office receiving the report or matters relating thereto
2350	4132		agrees in writing to hold it confidential and in a manner consistent
2351	4133		with the Viatical Settlements Act of 2008.
2352		-
2353	4134		F. 1. An examiner may not be appointed by the Commissioner if
2354	4135		the examiner, either directly or indirectly, has a conflict of
2355	4136		interest or is affiliated with the management of or owns a pecuniary
2356	4137		interest in any person subject to examination under the Viatical
	4138	+
	4139	+	ENGR. S. B. NO. 887 Page 80 1
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	4141	+	3
	4142	+	4
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	4149	+	11
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	4163	+
2357	4164		Settlements Act of 2008. This section shall not be construed to
2358	4165		automatically preclude an examiner from being:
2359		-
2360	4166		a. a viator,
2361		-
2362	4167		b. an insured in a viaticated insurance policy, or
2363		-
2364	4168		c. a beneficiary in an insurance policy that is proposed
2365	4169		to be viaticated.
2366		-
2367		-	ENR. S. B. NO. 887 Page 55
2368		-
2369	4170		2. Notwithstanding the requirements of this paragraph, the
2370	4171		Commissioner may retain from time to time, on an individual basis,
2371	4172		qualified actuaries, certified public accountants, or other similar
2372	4173		individuals who are independently practicing their professions, even
2373	4174		though these persons may from time to time be similarly employed or
2374	4175		retained by persons subject to examination under the Viatica l
2375	4176		Settlements Act of 2008.
2376		-
2377	4177		G. 1. No cause of action shall arise nor shall any liability
2378	4178		be imposed against the Commissioner, the Commissioner's authorized
2379	4179		representatives or any examiner appointed by the Commissioner for
2380	4180		any statements made or conduct pe rformed in good faith while
2381	4181		carrying out the provisions of the Viatical Settlements Act of 2008.
2382		-
2383	4182		2. No cause of action shall arise, nor shall any liability be
2384	4183		imposed against any person for the act of communicating or
2385	4184		delivering information or data to the Commissioner or the
2386	4185		Commissioner's authorized representative or examiner pursuant to an
2387	4186		examination made under the Viatical Settlements Act of 2008, if the
2388	4187		act of communication or delivery was performed in good faith and
	4188	+
	4189	+	ENGR. S. B. NO. 887 Page 81 1
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	4213	+
2389	4214		without fraudulent intent or the i ntent to deceive. This paragraph
2390	4215		does not abrogate or modify in any way any common law or statutory
2391	4216		privilege or immunity heretofore enjoyed by any person identified in
2392	4217		paragraph 1 of this subsection.
2393		-
2394	4218		3. A person identified in paragraph 1 or 2 of this su bsection
2395	4219		shall be entitled to an award of attorney fees and costs if he or
2396	4220		she is the prevailing party in a civil cause of action for libel,
2397	4221		slander or any other relevant tort arising out of activities in
2398	4222		carrying out the provisions of this act and the par ty bringing the
2399	4223		action was not substantially justified in doing so. For purposes of
2400	4224		this section a proceeding is "substantially justified" if it had a
2401	4225		reasonable basis in law or fact at the time that it was initiated.
2402		-
2403	4226		H. The Commissioner may investigate suspected fraudulent
2404	4227		viatical settlement acts and persons engaged in the business of
2405	4228		viatical settlements.
2406		-
2407		-	SECTION 25. AMENDATORY 36 O.S. 2011, Section 4055.9, is
	4229	+	SECTION 26. AMENDATORY 36 O.S. 2011, Section 4055.9, is
2408	4230		amended to read as follows:
2409		-
2410		-
2411		-	ENR. S. B. NO. 887 Page 56
2412	4231		Section 4055.9. A. 1. A viatical sett lement provider entering
2413	4232		into a viatical settlement contract shall first obtain:
2414		-
2415	4233		a. if the viator is the insured, a written statement from
2416	4234		a licensed attending physician that the viator is of
2417	4235		sound mind and under no constraint or undue influence
2418	4236		to enter into a viatical settlement contract, and
	4237	+
	4238	+	ENGR. S. B. NO. 887 Page 82 1
	4239	+	2
	4240	+	3
	4241	+	4
	4242	+	5
	4243	+	6
	4244	+	7
	4245	+	8
	4246	+	9
	4247	+	10
	4248	+	11
	4249	+	12
	4250	+	13
	4251	+	14
	4252	+	15
	4253	+	16
	4254	+	17
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	4257	+	20
	4258	+	21
	4259	+	22
	4260	+	23
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2419	4262
2420	4263		b. a document in which the insured consents to the
2421	4264		release of his or her medical records to a licensed
2422	4265		viatical settlement provider, viatical settlement
2423	4266		broker and the insurance company that issued the life
2424	4267		insurance policy covering the life of the insured.
2425		-
2426	4268		2. Within twenty (20) days after a viator executes documents
2427	4269		necessary to transfer any rights under an insurance policy or within
2428	4270		twenty (20) days of entering any agreement, option, promise or any
2429	4271		other form of understanding, expressed or implied, to viaticate the
2430	4272		policy, the viatical settlement provider shall give written notice
2431	4273		to the insurer that issued that insurance policy that the policy has
2432	4274		or will become a viaticated policy. The notice shall be accompanied
2433	4275		by the documents required by paragraph 3 of this subsection.
2434		-
2435	4276		3. Within twenty (20) days after a viator executes documents
2436	4277		necessary to transfer any rights under an insurance policy or within
2437	4278		twenty (20) days of entering any agreement, option, promise or any
2438	4279		other form of understanding, expressed or implied, to viaticate the
2439	4280		policy, the viatical provider shall deliver a copy of the medical
2440	4281		release required under subparagraph b of paragraph 1 of this
2441	4282		subsection, a copy of the viator's application for the vi atical
2442	4283		settlement contract, the notice required under paragraph 2 of this
2443	4284		subsection and a request for verification of coverage to the insurer
2444	4285		that issued the life policy that is the subject of the viatical
2445	4286		transaction. The National Association of Insuran ce Commissioner's
	4287	+
	4288	+	ENGR. S. B. NO. 887 Page 83 1
	4289	+	2
	4290	+	3
	4291	+	4
	4292	+	5
	4293	+	6
	4294	+	7
	4295	+	8
	4296	+	9
	4297	+	10
	4298	+	11
	4299	+	12
	4300	+	13
	4301	+	14
	4302	+	15
	4303	+	16
	4304	+	17
	4305	+	18
	4306	+	19
	4307	+	20
	4308	+	21
	4309	+	22
	4310	+	23
	4311	+	24
	4312	+
2446	4313		(NAIC's) form for verification of coverage shall be used unless
2447	4314		another form is developed and approved by the Insurance
2448	4315		Commissioner.
2449		-
2450	4316		4. The insurer shall respond to a request for verification of
2451	4317		coverage submitted on an approved form by a viatical settlement
2452	4318		provider or viatical settlement broker within thirty (30) calendar
2453	4319		days of the date the request is received and shall indicate whether,
2454		-
2455		-	ENR. S. B. NO. 887 Page 57
2456	4320		based on the medical evidence and documents provided, the insurer
2457	4321		intends to pursue an investigat ion at this time regarding the
2458	4322		validity of the insurance contract or possible fraud. The insurer
2459	4323		shall accept a request for verification of coverage made on an NAIC
2460	4324		form, any form agreed upon by the insurer and the requestor, or any
2461	4325		other form approved by the Commissioner. The insurer shall accept
2462	4326		an original or facsimile or electronic copy of such request and any
2463	4327		accompanying authorization signed by the viator. Failure by the
2464	4328		insurer to meet its obligations under this subsection shall be a
2465	4329		violation of subsection C of Section 10 and Section 15 of Enrolled
2466	4330		Senate Bill No. 1980 of the 2nd Session of the 51st Oklahoma
2467	4331		Legislature.
2468		-
2469	4332		5. Prior to or at the time of execution of the viatical
2470	4333		settlement contract, the viatical settlement provider shall obtain a
2471	4334		witnessed document in which the viator consents to the viatical
2472	4335		settlement contract, represents that the viator has a full and
2473	4336		complete understanding of the viatical settlement contract, that he
	4337	+
	4338	+	ENGR. S. B. NO. 887 Page 84 1
	4339	+	2
	4340	+	3
	4341	+	4
	4342	+	5
	4343	+	6
	4344	+	7
	4345	+	8
	4346	+	9
	4347	+	10
	4348	+	11
	4349	+	12
	4350	+	13
	4351	+	14
	4352	+	15
	4353	+	16
	4354	+	17
	4355	+	18
	4356	+	19
	4357	+	20
	4358	+	21
	4359	+	22
	4360	+	23
	4361	+	24
	4362	+
2474	4363		or she has a full and complete understanding of the benefits of the
2475	4364		life insurance policy, acknowledges that he or she is entering into
2476	4365		the viatical settlement contract freely and voluntarily and, for
2477	4366		persons with a terminal or chronic illness or condition,
2478	4367		acknowledges that the insured has a terminal or chronic illne ss and
2479	4368		that the terminal or chronic illness or condition was diagnosed
2480	4369		after the life insurance policy was issued.
2481		-
2482	4370		6. The insurer shall not unreasonably delay effecting change of
2483	4371		ownership or beneficiary with any life settlement contract entered
2484	4372		into in this state or with a resident of this state.
2485		-
2486	4373		7. If a viatical settlement broker performs any of these
2487	4374		activities required of the viatical settlement provider, the
2488	4375		provider is deemed to have fulfilled the requirements of this
2489	4376		section.
2490		-
2491	4377		B. All medical inform ation solicited or obtained by any
2492	4378		licensee shall be subject to the applicable provisions of state law
2493	4379		relating to confidentiality of medical information.
2494		-
2495	4380		C. All viatical settlement contracts entered into in this state
2496	4381		shall provide the viator with an abs olute right to rescind the
2497	4382		contract before the earlier of thirty (30) calendar days after the
2498		-
2499		-	ENR. S. B. NO. 887 Page 58
2500	4383		date upon which the viatical settlement contract is executed by all
2501	4384		parties or fifteen (15) calendar days after the viatical settlement
2502	4385		proceeds have been sent to the viator. Rescission by the viator may
2503	4386		be conditioned upon the viator both giving notice and repaying to
	4387	+
	4388	+	ENGR. S. B. NO. 887 Page 85 1
	4389	+	2
	4390	+	3
	4391	+	4
	4392	+	5
	4393	+	6
	4394	+	7
	4395	+	8
	4396	+	9
	4397	+	10
	4398	+	11
	4399	+	12
	4400	+	13
	4401	+	14
	4402	+	15
	4403	+	16
	4404	+	17
	4405	+	18
	4406	+	19
	4407	+	20
	4408	+	21
	4409	+	22
	4410	+	23
	4411	+	24
	4412	+
2504	4413		the viatical settlement provider within the rescission period all
2505	4414		proceeds of the settlement and any premiums, loans and loan interest
2506	4415		paid by or on behalf of the viatical settlement provider in
2507	4416		connection with or as a consequence of the viatical settlement. If
2508	4417		the insured dies during the rescission period, the viatical
2509	4418		settlement contract shall be deemed to have been rescinded, subject
2510	4419		to repayment to the viatical settlement provider or purchaser of all
2511	4420		viatical settlement proceeds, and any premiums, loans and loan
2512	4421		interest that have been paid by the viatical settlement provider or
2513	4422		purchaser, which shall be paid within sixty (60) calendar days of
2514	4423		the death of the insured. In the event of any rescission, if the
2515	4424		viatical settlement provider has paid commissions or other
2516	4425		compensation to a viatical settlement broker in connection with the
2517	4426		rescinded transaction, the viatical settlement broker shall refun d
2518	4427		all such commissions and compensation to the viatical settlement
2519	4428		provider within five (5) business days following receipt of written
2520	4429		demand from the viatical settlement provider, which demand shall be
2521	4430		accompanied by either the viator's notice of rescissi on if rescinded
2522	4431		at the election of the viator, or notice of the death of the insured
2523	4432		if rescinded by reason of the death of the insured within the
2524	4433		applicable rescission period.
2525		-
2526	4434		D. The viatical settlement provider shall instruct the viator
2527	4435		to send the executed documents required to effect the change in
2528	4436		ownership, assignment or change in beneficiary directly to the
	4437	+
	4438	+	ENGR. S. B. NO. 887 Page 86 1
	4439	+	2
	4440	+	3
	4441	+	4
	4442	+	5
	4443	+	6
	4444	+	7
	4445	+	8
	4446	+	9
	4447	+	10
	4448	+	11
	4449	+	12
	4450	+	13
	4451	+	14
	4452	+	15
	4453	+	16
	4454	+	17
	4455	+	18
	4456	+	19
	4457	+	20
	4458	+	21
	4459	+	22
	4460	+	23
	4461	+	24
	4462	+
2529	4463		independent escrow agent. Within three (3) business days after the
2530	4464		date the escrow agent receives the document or from the date the
2531	4465		viatical settlement provider receives the documents, if the viator
2532	4466		erroneously provides the documents directly to the provider, the
2533	4467		provider shall pay or transfer the proceeds of the viatical
2534	4468		settlement into an escrow or trust account maintained in a state - or
2535	4469		federally-chartered financial institution whose deposits are insured
2536	4470		by the Federal Deposit Insurance Corporation (FDIC). Upon payment
2537	4471		of the settlement proceeds into the escrow account, the escrow agent
2538	4472		shall deliver the original change in ownership, assignment or change
2539	4473		in beneficiary forms to the viatical settlement provider or related
2540	4474		provider trust or other designated representative of the viatical
2541	4475		settlement provider. Upon the escrow agent's receipt of the
2542		-
2543		-	ENR. S. B. NO. 887 Page 59
2544	4476		acknowledgment of the properly completed transfer of ownership,
2545	4477		assignment or designation of beneficiary from the insurance company,
2546	4478		the escrow agent shall pay the settlement proceeds to the viator.
2547		-
2548	4479		E. Failure to tender consideration to the viator for the
2549	4480		viatical settlement contract within the time set forth in the
2550	4481		disclosure pursuant to paragraph 7 of subsection A of Section 8 of
2551	4482		Enrolled Senate Bill No. 1980 of the 2nd Session of the 51st
2552	4483		Oklahoma Legislature renders the viatical settlement contract
2553	4484		voidable by the viator for lack of consideration unti l the time
2554	4485		consideration is tendered to and accepted by the viator. Funds
2555	4486		shall be deemed sent by a viatical settlement provider to a viator
	4487	+
	4488	+	ENGR. S. B. NO. 887 Page 87 1
	4489	+	2
	4490	+	3
	4491	+	4
	4492	+	5
	4493	+	6
	4494	+	7
	4495	+	8
	4496	+	9
	4497	+	10
	4498	+	11
	4499	+	12
	4500	+	13
	4501	+	14
	4502	+	15
	4503	+	16
	4504	+	17
	4505	+	18
	4506	+	19
	4507	+	20
	4508	+	21
	4509	+	22
	4510	+	23
	4511	+	24
	4512	+
2556	4513		as of the date that the escrow agent either releases funds for wire
2557	4514		transfer to the viator or, places a check for delivery to the viator
2558	4515		via United States Postal Service or other nationally recognized
2559	4516		delivery service or make an electronic payment to the viator .
2560		-
2561	4517		F. In order to assure that a viator, at the time of the
2562	4518		viatical settlement has a life expectancy of less than two (2)
2563	4519		years, receives reasonable return for viaticating an insurance
2564	4520		policy, the following shall be minimum discounts:
2565		-
2566	4521		Minimum Percentage of Face
2567		-
2568	4522		Insured's Life Value Less Outstanding Loans
2569		-
2570	4523		Expectancy Received By Viator
2571		-
2572	4524		Less than six (6) months 80%
2573		-
2574	4525		At least six (6) but less than
2575	4526		twelve (12) months 70%
2576		-
2577	4527		At least twelve (12) but less
2578	4528		than eighteen (18) months 65%
2579		-
2580	4529		At least eighteen (18) months but
2581	4530		less than twenty-four (24) months 60%
2582		-
2583	4531		G. Contacts with the insured for the purpose of determining the
2584	4532		health status of the insured by the viatical settlement provider or
2585	4533		viatical settlement broker after the viatical settlement has
2586		-
2587		-	ENR. S. B. NO. 887 Page 60
2588	4534		occurred shall only be made by a viatical settlement provider or
2589	4535		broker licensed in this state or its authorized representatives and
2590	4536		shall be limited to once every three (3) months for insureds with a
	4537	+
	4538	+	ENGR. S. B. NO. 887 Page 88 1
	4539	+	2
	4540	+	3
	4541	+	4
	4542	+	5
	4543	+	6
	4544	+	7
	4545	+	8
	4546	+	9
	4547	+	10
	4548	+	11
	4549	+	12
	4550	+	13
	4551	+	14
	4552	+	15
	4553	+	16
	4554	+	17
	4555	+	18
	4556	+	19
	4557	+	20
	4558	+	21
	4559	+	22
	4560	+	23
	4561	+	24
	4562	+
2591	4563		life expectancy of more than one (1) year, and to no more than once
2592	4564		per month for insureds with a life expectancy of one (1) year or
2593	4565		less. The provider or broker shall explain the pr ocedure for these
2594	4566		contacts at the time the viatical settlement contract is entered
2595	4567		into. The limitations set forth in this subsection shall not apply
2596	4568		to any contacts with an insured for reasons other than determining
2597	4569		the insured's health status. Viatical settlement providers and
2598	4570		viatical settlement brokers shall be responsible for the actions of
2599	4571		their authorized representatives.
2600		-
2601		-	SECTION 26. AMENDATORY 36 O.S. 2011, Section 4103 , is
	4572	+	SECTION 27. AMENDATORY 36 O.S. 2011, Section 4103, is
2602	4573		amended to read as follows:
2603		-
2604	4574		Section 4103. A. No policy of group life insurance shall be
2605	4575		delivered in this state unless a schedule of the premium rates
2606	4576		pertaining to the form thereof is filed with the Insurance
2607	4577		Commissioner and unless it contains in substance the following
2608	4578		provisions, or provisions whic h are more favorable to the persons
2609	4579		insured, or at least as favorable to the persons insured and more
2610	4580		favorable to the policyholder ,; provided, however, (a) that
2611	4581		provisions six (6) to ten (10) inclusive :
2612		-
2613	4582		1. Paragraphs 6 through 10 of this section shall not apply to
2614	4583		policies issued to a creditor to insure debtors of such creditor;
2615		-
2616	4584		(b) that
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2617	4610
2618	4611		2. That the standard provisions required for individual life
2619	4612		insurance policies shall not apply to group life insurance policies;
2620	4613		and
2621		-
2622	4614		(c) that
2623		-
2624	4615		3. That if the group life insurance policy is on a plan of
2625	4616		insurance other than the term plan, it shall contain a nonforfeiture
2626	4617		provision or provisions which is or are equitable to the insured
2627	4618		persons and to the policyholder, but nothing herein shall be
2628	4619		construed to require that g roup life insurance policies contain the
2629		-
2630		-	ENR. S. B. NO. 887 Page 61
2631	4620		same nonforfeiture provisions as are required for individual life
2632	4621		insurance policies:
2633		-
2634	4622		1. B. A provision that the policyholder is entitled to a grace
2635	4623		period of thirty-one (31) days for the payment of any premium due
2636	4624		except the first, during which grace period the death benefit
2637	4625		coverage shall continue in force, unless the policyholder shall have
2638	4626		given the insurer written notice of discontinuance in advance of the
2639	4627		date of discontinuance and in accordance with the terms of the
2640	4628		policy. The policy may provide that the policyholder shall be
2641	4629		liable to the insurer for the payment of a pro rata premium for the
2642	4630		time the policy was in force during such grace period.
2643		-
2644	4631		2. C. A provision that the validity of the policy shall not b e
2645	4632		contested, except for nonpayment of premiums, after it has been in
2646	4633		force for two (2) years from its date of issue ;, and that no
2647	4634		statement made by any person insured under the policy relating to
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	4642	+	7
	4643	+	8
	4644	+	9
	4645	+	10
	4646	+	11
	4647	+	12
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	4660	+
2648	4661		his or her insurability shall be used in contesting the vali dity of
2649	4662		the insurance with respect to which such statement was made after
2650	4663		such insurance has been in force prior to the contest for a period
2651	4664		of two (2) years during such person's lifetime nor unless it is
2652	4665		contained in a written instrument signed by him or her.
2653		-
2654	4666		3. D. A provision that a copy of the application, if any, of
2655	4667		the policyholder shall be attached to the policy when issued, that
2656	4668		all statements made by the policyholder or by the persons insured
2657	4669		shall be deemed representations and not warranties, and that no
2658	4670		statement made by any person insured shall be used in any contest
2659	4671		unless a copy of the instrument containing the statement is or has
2660	4672		been furnished to such person or to his or her beneficiary.
2661		-
2662	4673		4. E. A provision setting forth the conditions, if any , under
2663	4674		which the insurer reserves the right to require a person eligible
2664	4675		for insurance to furnish evidence of individual insurability
2665	4676		satisfactory to the insurer as a condition to part or all of his or
2666	4677		her coverage.
2667		-
2668	4678		5. F. A provision specifying an equita ble adjustment of
2669	4679		premiums or of benefits or of both to be made in the event the age
2670	4680		of a person insured has been misstated, such provision to contain a
2671	4681		clear statement of the method of adjustment to be used.
2672		-
2673		-
2674		-	ENR. S. B. NO. 887 Page 62
2675	4682		6. G. A provision that any sum becoming due by reason of the
2676	4683		death of the person insured shall be payable to the beneficiary
2677	4684		designated by the person insured, subject to the provisions of the
	4685	+
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	4710	+
2678	4711		policy in the event there is no designated beneficiary as to all or
2679	4712		any part of such sum, living at the death of the person insured, and
2680	4713		subject to any right reserved by the insurer in the policy and set
2681	4714		forth in the certificate to pay at its option a part of such sum not
2682	4715		exceeding Five Hundred Dollars ($500.00) to any person appearing to
2683	4716		the insurer to be equitab ly entitled thereto by reason of having
2684	4717		incurred funeral or other expenses incident to the last illness or
2685	4718		death of the person insured.
2686		-
2687	4719		7. H. A provision that the insurer will issue to the
2688	4720		policyholder for delivery to each person insured an individual
2689	4721		certificate setting forth a statement as to the insurance protection
2690	4722		to which he is entitled, to whom the insurance benefits are payable,
2691	4723		and the rights and conditions set forth in paragraphs (8), (9) and
2692	4724		(10) of this section:.
2693		-
2694	4725		8. I. A provision that if the insurance, or any portion of it,
2695	4726		on a person covered under the policy ceases because of termination
2696	4727		of employment or of membership in the class or classes eligible for
2697	4728		coverage under the policy, such person shall be entitled to have
2698	4729		issued to him or her by the insurer, without evidence of
2699	4730		insurability, an individual policy of life insurance without
2700	4731		disability or other supplementary benefits, provided an application
2701	4732		for the individual policy shall be made, and the first premium paid
2702	4733		to the insurer, within th irty-one (31) days after such termination,
2703	4734		and provided further that:
2704	4735
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	4760	+
2705	4761		(a)
2706		-
2707	4762		a. the individual policy shall, at the option of such
2708	4763		person, be on any one of the forms, except term
2709	4764		insurance, then customarily issued by the insurer at
2710	4765		the age and for the amount applied for;,
2711		-
2712	4766		(b)
2713		-
2714	4767		b. the individual policy shall be in an amount not in
2715	4768		excess of the amount of life insurance which ceases
2716	4769		because of such termination, less, in the case of a
2717		-
2718		-	ENR. S. B. NO. 887 Page 63
2719	4770		person whose membership in the class or classes
2720	4771		eligible for coverage terminates but who continues in
2721	4772		employment in another class, the amount of any life
2722	4773		insurance for which such person is or becomes eligible
2723	4774		within thirty-one (31) days after such termination
2724	4775		under any other group policy; provided that any amount
2725	4776		of insurance which sh all have matured on or before the
2726	4777		date of such termination as an endowment payable to
2727	4778		the person insured, whether in one sum or in
2728	4779		installments or in the form of an annuity, shall not,
2729	4780		for the purposes of this provision subparagraph, be
2730	4781		included in the amount which is considered to cease
2731	4782		because of such termination ;, and
2732		-
2733	4783		(c)
	4784	+
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2734	4809
2735	4810		c. the premium on the individual policy shall be at the
2736	4811		insurer's then customary rate applicable to the form
2737	4812		and amount of the individual policy, to the class of
2738	4813		risk to which such pers on then belongs, and to his or
2739	4814		her age attained on the effective date of the
2740	4815		individual policy.
2741		-
2742	4816		9. J. A provision that if the group policy terminates or is
2743	4817		amended so as to terminate the insurance of any class of insured
2744	4818		persons, every person insured ther eunder at the date of such
2745	4819		termination whose insurance terminates and who has been so insured
2746	4820		for at least five (5) years prior to such termination date shall be
2747	4821		entitled to have issued to him or her by the insurer an individual
2748	4822		policy of life insurance, s ubject to the same conditions and
2749	4823		limitations as are provided by paragraph (8) 8 of this section,
2750	4824		except that the group policy may provide that the amount of such
2751	4825		individual policy shall not exceed the smaller of (a):
2752		-
2753	4826		a. the amount of the person's life ins urance protection
2754	4827		ceasing because of the termination or amendment of the
2755	4828		group policy, less the amount of any life insurance
2756	4829		for which he or she is or becomes eligible under any
2757	4830		group policy issued or reinstated by the same or
2758	4831		another insurer within thirty -one (31) days after such
2759	4832		termination, and (b)
2760		-
2761		-
2762		-	ENR. S. B. NO. 887 Page 64
2763	4833		b. Ten Thousand Dollars ($10,000.00).
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	4854	+	20
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	4858	+	24
2764	4859
2765	4860		10. K. A provision that if a person insured under the group
2766	4861		policy dies during the period within which he or she would have been
2767	4862		entitled to have an individual policy iss ued to him or her in
2768	4863		accordance with paragraph (8) I or (9) J of this section and before
2769	4864		such an individual policy shall have become effective, the amount of
2770	4865		life insurance which he or she would have been entitled to have
2771	4866		issued to him or her under such individual policy shall be payable
2772	4867		as a claim under the group policy, whether or not application for
2773	4868		the individual policy or the payment of the first premium therefor
2774	4869		has been made.
2775		-
2776	4870		11. L. In the case of a policy issued to a creditor to insure
2777	4871		debtors of such creditor, a provision that the insurer will furnish
2778	4872		to the policyholder for delivery to each debtor insured under the
2779	4873		policy a form which shall contain a statement that the life of the
2780	4874		debtor is insured under the policy and that any death benefit paid
2781	4875		thereunder by reason of his or her death shall be applied to reduce
2782	4876		or extinguish the indebtedness.
2783		-
2784		-	SECTION 27. AMENDATORY 36 O.S. 2011, S ection 4112, is
	4877	+	SECTION 28. AMENDATORY 36 O.S. 2011, Section 4112, is
2785	4878		amended to read as follows:
2786		-
2787	4879		Section 4112. An insurer shall pay the proceeds of any benefits
2788	4880		under group life insurance policy not more than thirty (30) days
2789	4881		after the insurer has received proof of death of the insured. If
2790	4882		the proceeds are not paid within this period, the insurer shall pay
2791	4883		interest on the proceeds, at a rate which is not less than the
	4884	+
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	4907	+	23
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	4909	+
2792	4910		current rate of interest on death proceeds on deposit with the
2793	4911		insurer, from the date of death of the insured to the date when the
2794	4912		proceeds are paid. Payment shall be deemed to have been made on the
2795	4913		date an electronic payment is made or a check, draft or other valid
2796	4914		instrument which is equivalent to payment was placed in the U.S.
2797	4915		mails in a properly addressed, postpaid envelope; or, if not so
2798	4916		posted, on the date of delivery of such instrument to the
2799	4917		beneficiary.
2800		-
2801		-	SECTION 28. AMENDATORY 36 O.S. 2011, Section 6060.11, as
	4918	+	SECTION 29. AMENDATORY 36 O.S. 2011, Section 6060.11, as
2802	4919		amended by Section 2, Chapter 75, O.S.L. 2020 (36 O.S. Supp. 2020,
2803	4920		Section 6060.11), is amended to read as follows:
2804		-
2805		-
2806		-	ENR. S. B. NO. 887 Page 65
2807	4921		Section 6060.11. A. Subject to the limitations set forth in
2808	4922		this section and Sec tions 6060.12 and 6060.13 of this title, any
2809	4923		health benefit plan that is offered, issued, or renewed in this
2810	4924		state on or after the effective date of this act shall provide
2811	4925		benefits for treatment of mental health and substance use disorders.
2812		-
2813	4926		B. 1. Benefits for mental health and substance use disorders
2814	4927		shall be equal to benefits for treatment of and shall be subject to
2815	4928		the same preauthorization and utilization review mechanisms and
2816	4929		other terms and conditions as all other physical diseases and
2817	4930		disorders including, but not limited to:
2818		-
2819	4931		a. coverage of inpatient hospital services for either
2820	4932		twenty-six (26) days or the limit for other covered
2821	4933		illnesses, whichever is greater,
2822	4934
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	4959	+
2823	4960		b. coverage of outpatient services,
2824		-
2825	4961		c. coverage of medication,
2826		-
2827	4962		d. maximum lifetime benefit s,
2828		-
2829	4963		e. copayments,
2830		-
2831	4964		f. coverage of home health visits,
2832		-
2833	4965		g. individual and family deductibles, and
2834		-
2835	4966		h. coinsurance.
2836		-
2837	4967		2. Treatment limitations applicable to mental health or
2838	4968		substance use disorder benefits shall be no more restrictive than
2839	4969		the predominant treatm ent limitations applied to substantially all
2840	4970		medical and surgical benefits covered by the plan. There shall be
2841	4971		no separate treatment limitations that are applicable only with
2842	4972		respect to mental health or substance abuse disorder benefits.
2843		-
2844	4973		C. A health benefit plan shall not impose a nonquantitative
2845	4974		treatment limitation with respect to mental health and substance use
2846	4975		disorders in any classification of benefits unless, under the terms
2847	4976		of the health benefit plan as written and in operation, any
2848	4977		processes, strategies, evidentiary standards or other factors used
2849		-
2850		-	ENR. S. B. NO. 887 Page 66
2851	4978		in applying the nonquantitative treatment limitation to mental
2852	4979		health disorders in the classification are comparable to and applied
2853	4980		no more stringently than to medical and surgical benefits in the
2854	4981		same classification.
2855		-
2856	4982		D. All health benefit plans must meet the requirements of the
2857	4983		federal Paul Wellstone and Pete Domenici Mental Health Parity and
	4984	+
	4985	+	ENGR. S. B. NO. 887 Page 97 1
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	5000	+	16
	5001	+	17
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	5009	+
2858	5010		Addiction Equity Act of 2008, as amended, and federal guidance or
2859	5011		regulations issued under these acts including 4 5 CFR 146.136, 45 CFR
2860	5012		147.160 and 45 CFR 156.115(a)(3).
2861		-
2862	5013		E. Beginning on or after the effective date of this act, each
2863	5014		insurer that offers, issues or renews any individual or group health
2864	5015		benefit plan providing mental health or substance use disorder
2865	5016		benefits shall submit an annual report to the Insurance Commissioner
2866	5017		on or before April 1 of each year that contains the following:
2867		-
2868	5018		1. A description of the process used to develop or select the
2869	5019		medical necessity criteria for mental health and substance use
2870	5020		disorder benefits and the process used to develop or select the
2871	5021		medical necessity criteria for medical and surgical benefits;
2872		-
2873	5022		2. Identification of all nonquantitative treatment limitations
2874	5023		applied to both mental health and substance use disorder benefits
2875	5024		and medical and surgical benefits within each classification of
2876	5025		benefits; and
2877		-
2878	5026		3. The results of an analysis that demonstrates that for the
2879	5027		medical necessity criteria described in paragraph 1 of this
2880	5028		subsection and for each nonquantitative treatment limitatio n
2881	5029		identified in paragraph 2 of this subsection, as written and in
2882	5030		operation, the processes, strategies, evidentiary standards or other
2883	5031		factors used in applying the medical necessity criteria and each
2884	5032		nonquantitative treatment limitation to mental health an d substance
2885	5033		use disorder benefits within each classification of benefits are
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	5059	+
2886	5060		comparable to and are applied no more stringently than to medical
2887	5061		and surgical in the same classification of benefits. At a minimum,
2888	5062		the results of the analysis shall:
2889		-
2890	5063		a. identify the factors used to determine that a
2891	5064		nonquantitative treatment limitation will apply to a
2892		-
2893		-	ENR. S. B. NO. 887 Page 67
2894	5065		benefit including factors that were considered but
2895	5066		rejected,
2896		-
2897	5067		b. identify and define the specific evidentiary standards
2898	5068		used to define the factors and any other evid ence
2899	5069		relied upon in designing each nonquantitative
2900	5070		treatment limitation,
2901		-
2902	5071		c. provide the comparative analyses including the results
2903	5072		of the analyses performed to determine that the
2904	5073		processes and strategies used to design each
2905	5074		nonquantitative treatment limita tion, as written, and
2906	5075		the as written processes and strategies used to apply
2907	5076		the nonquantitative treatment limitation to mental
2908	5077		health and substance use disorder benefits are
2909	5078		comparable to and applied no more stringently than the
2910	5079		processes and strategies us ed to design each
2911	5080		nonquantitative treatment limitation, as written, and
2912	5081		the as written processes and strategies used to apply
2913	5082		the nonquantitative treatment limitation to medical
2914	5083		and surgical benefits,
2915	5084
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	5099	+	15
	5100	+	16
	5101	+	17
	5102	+	18
	5103	+	19
	5104	+	20
	5105	+	21
	5106	+	22
	5107	+	23
	5108	+	24
	5109	+
2916	5110		d. provide the comparative analyses including the resul ts
2917	5111		of the analyses performed to determine that the
2918	5112		processes and strategies used to apply each
2919	5113		nonquantitative treatment limitation, in operation,
2920	5114		for mental health and substance use disorder benefits
2921	5115		are comparable to and applied no more stringently than
2922	5116		the processes or strategies used to apply each
2923	5117		nonquantitative treatment limitation for medical and
2924	5118		surgical benefits in the same classification of
2925	5119		benefits, and
2926		-
2927	5120		e. disclose the specific findings and conclusions reached
2928	5121		by the insurer that the results of t he analyses
2929	5122		required by this subsection indicate that the insurer
2930	5123		is in compliance with this section and the Paul
2931	5124		Wellstone and Pete Domenici Mental Health Parity and
2932	5125		Addiction Equity Act of 2008, as amended, and its
2933	5126		implementing and related regulations in cluding 45 CFR
2934	5127		146.136, 45 CFR 147.160 and 45 CFR 156.115(a)(3).
2935		-
2936		-
2937		-	ENR. S. B. NO. 887 Page 68
2938	5128		F. The Commissioner shall implement and enforce any applicable
2939	5129		provisions of the Paul Wellstone and Pete Domenici Mental Health
2940	5130		Parity and Addiction Equity Act of 2008, as amended, and feder al
2941	5131		guidance or regulations issued under these acts including 45 CFR
2942	5132		146.136, 45 CFR 147.136, 45 CFR 147.160 and 45 CFR 156.115(a)(3).
	5133	+
	5134	+	ENGR. S. B. NO. 887 Page 100 1
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2943	5158
2944	5159		G. No later than June 1, 2021 December 31, 2021, and by June 1
2945	5160		December 31 of each year thereafter, the Commissioner shal l make
2946	5161		available to the public the reports submitted by insurers, as
2947	5162		required in subsection E of this section, during the most recent
2948	5163		annual cycle; provided, however, that any information that is
2949	5164		confidential or a trade secret shall be redacted.
2950		-
2951	5165		1. The Commissioner shall identify insurers that have failed in
2952	5166		whole or in part to comply with the full extent of reporting
2953	5167		required in this section and shall make a reasonable attempt to
2954	5168		obtain missing reports or information by June 1 of the following
2955	5169		year.
2956		-
2957	5170		2. The reports submitted by insurers and the identification by
2958	5171		the Commissioner of noncompliant insurers shall be made available to
2959	5172		the public by posting on the Internet website of the Insurance
2960	5173		Department.
2961		-
2962	5174		H. The Commissioner shall promulgate rules pursuant to the
2963	5175		provisions of this section and any provisions of the Paul Wellstone
2964	5176		and Pete Domenici Mental Health Parity and Addiction Equity Act of
2965	5177		2008, as amended, that relate to the business of insurance.
2966		-
2967		-	SECTION 29. AMENDATORY 36 O.S. 2011, Section 6060.12, as
	5178	+	SECTION 30. AMENDATORY 36 O.S . 2011, Section 6060.12, as
2968	5179		amended by Section 3, Chapter 75, O.S.L. 2020 (36 O.S. Supp. 2020,
2969	5180		Section 6060.12), is amended to read as follows:
2970		-
2971	5181		Section 6060.12. 1. A health benefit plan that, at the end of
2972	5182		its base period, experiences a greater than two percent (2%)
	5183	+
	5184	+	ENGR. S. B. NO. 887 Page 101 1
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	5186	+	3
	5187	+	4
	5188	+	5
	5189	+	6
	5190	+	7
	5191	+	8
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	5208	+
2973	5209		increase in premium costs pursuant to providing benefits for
2974	5210		treatment of mental health and substance use disorders shall be
2975	5211		exempt from the provisions of Section 6060.11 of this title.
2976		-
2977	5212		2. To calculate base -period-premium costs, the health be nefit
2978	5213		plan shall subtract from premium costs incurred during the base
2979	5214		period, both the premium costs incurred during the period
2980		-
2981		-	ENR. S. B. NO. 887 Page 69
2982	5215		immediately preceding the base period and any premium cost increases
2983	5216		attributable to factors unrelated to benefits for treatment of
2984	5217		mental health and substance use disorders.
2985		-
2986	5218		3. a. To claim the exemption provided for in subsection A
2987	5219		paragraph 1 of this section a health benefit plan
2988	5220		shall provide to the Insurance Commissioner a written
2989	5221		request signed by an actuary stating the reason s and
2990	5222		actuarial assumptions upon which the request is based.
2991		-
2992	5223		b. The Commissioner shall verify the information provided
2993	5224		and shall approve or disapprove the request within
2994	5225		thirty (30) days of receipt.
2995		-
2996	5226		c. If, upon investigation, the Commissioner finds that
2997	5227		any statement of fact in the request is found to be
2998	5228		knowingly false, the health benefit plan may be
2999	5229		subject to suspension or loss of license or any other
3000	5230		penalty as determined by the Commissioner , or the
3001	5231		State Commissioner of Health with regard to health
3002	5232		maintenance organizations.
3003	5233
3004		-	SECTION 30. NEW LAW A new s ection of law to be cod ified
	5234	+	ENGR. S. B. NO. 887 Page 102 1
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	5258	+
	5259	+	SECTION 31. NEW LAW A new section of law to be codified
3005	5260		in the Oklahoma Statutes as Section 6124.2 of Title 36, unless there
3006	5261		is created a duplication in numbering, reads as follows:
3007		-
3008	5262		A. No prepaid funeral bene fit permit holder shall change the
3009	5263		name under which the permit holder operates except as provided in
3010	5264		this section. The prepaid funeral benefit permit holder shall
3011	5265		obtain approval from the Insurance Commissioner at least thirty (30)
3012	5266		days prior to changing the name of the permit holder. The
3013	5267		application for change of name of a prepaid funeral benefit permit
3014	5268		holder shall be in a form provided by the Insurance Commissioner and
3015	5269		shall contain, at a minimum, the following information:
3016		-
3017	5270		1. The name of the permit h older;
3018		-
3019	5271		2. The proposed new name of the permit holder; and
3020		-
3021	5272		3. The date the name change will become effective.
3022		-
3023		-
3024		-	ENR. S. B. NO. 887 Page 70
3025	5273		B. The Insurance Commissioner may waive the approval
3026	5274		requirement provided for in subsection A of this section upon good
3027	5275		cause shown.
3028		-
3029	5276		C. The Insurance Commissioner may deny the change of name of
3030	5277		the prepaid funeral benefit permit holder upon good cause shown.
3031		-
3032	5278		D. Upon approval of a change of name, the Insurance
3033	5279		Commissioner shall issue a prepaid funeral benefit permit with the
3034	5280		new name. The prepa id funeral benefit permit holder shall display
3035	5281		in a conspicuous place at all times on the premises of the
3036	5282		organization all permits issued pursuant to the provisions of this
	5283	+
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	5285	+	2
	5286	+	3
	5287	+	4
	5288	+	5
	5289	+	6
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	5308	+
3037	5309		section. No organization may consent to or allow the use or display
3038	5310		of the permit by a person other than the persons authorized to
3039	5311		represent the organization in contracting prepaid funeral benefits.
3040		-
3041	5312		E. The Insurance Commissioner may prescribe rules concerning
3042	5313		matters incidental to this section.
3043		-
3044		-	SECTION 31. AMENDATORY 36 O.S. 2011, Section 6216.1, is
	5314	+	SECTION 32. AMENDATORY 36 O.S. 2011, Section 6216.1, is
3045	5315		amended to read as follows:
3046		-
3047	5316		Section 6216.1. No insurance company authorized to transact
3048	5317		insurance in this state shall make payment of any insurance claim,
3049	5318		or any portion of a claim, to a public adjuster on account o f
3050	5319		services rendered by a public adjuster to an insured unless the name
3051	5320		of the insured is added as a joint payee on any claim check or,
3052	5321		draft or electronic payment . The payment, whether by check, draft ,
3053	5322		electronic payment or otherwise, shall be sent to the address or
3054	5323		electronic mail address designated by the insured.
3055		-
3056		-	SECTION 32. AMENDATORY 36 O.S. 2011, Sectio n 6217, as
	5324	+	SECTION 33. AMENDATORY 36 O.S. 2011, Section 6217, as
3057	5325		last amended by Section 14, Chapter 269, O.S.L. 2013 (36 O.S. Supp.
3058	5326		2020, Section 6217), is amended to read as fol lows:
3059		-
3060	5327		Section 6217. A. All licenses issued pursuant to the
3061	5328		provisions of the Insurance Adjusters Licensing Act shall continue
3062	5329		in force not longer than twenty -four (24) months. The renewal dates
3063	5330		for the licenses may be staggered throughout the year by no tifying
3064	5331		licensees in writing of the expiration and renewal date being
	5332	+
	5333	+	ENGR. S. B. NO. 887 Page 104 1
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	5335	+	3
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	5337	+	5
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	5357	+
3065	5358		assigned to the licensees by the Insurance Commissioner and by
3066	5359		making appropriate adjustments in the biennial licensing fee.
3067		-
3068		-	ENR. S. B. NO. 887 Page 71
3069		-
3070	5360		B. Any licensee applying for renewal of a license as an
3071	5361		adjuster shall have completed not less than twenty -four (24) clock
3072	5362		hours of continuing insurance education, of which three (3) hours
3073	5363		shall be in ethics, within the previous twenty -four (24) months
3074	5364		prior to renewal of the license. The Insurance Commissioner sh all
3075	5365		approve courses and providers of continuing education for insurance
3076	5366		adjusters as required by this section.
3077		-
3078	5367		The Insurance Department may use one or more of the following to
3079	5368		review and provide a nonbinding recommendation to the Insurance
3080	5369		Commissioner on approval or disapproval of courses and providers of
3081	5370		continuing education:
3082		-
3083	5371		1. Employees of the Insurance Commissioner;
3084		-
3085	5372		2. A continuing education advisory committee . The continuing
3086	5373		education advisory committee is separate and distinct from the
3087	5374		Advisory Board established by Section 6221 of this title ;
3088		-
3089	5375		3. An independent service whose normal business activities
3090	5376		include the review and approval of continuing education courses and
3091	5377		providers. The Commissioner may negotiate agreements with such
3092	5378		independent service to review documents and other materials
3093	5379		submitted for approval of courses and providers and present the
3094	5380		Commissioner with its nonbinding recommendation. The Commissioner
3095	5381		may require such independent service to collect the fee charged by
	5382	+
	5383	+	ENGR. S. B. NO. 887 Page 105 1
	5384	+	2
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	5407	+
3096	5408		the independent service for reviewing materials provided for review
3097	5409		directly from the course providers.
3098		-
3099	5410		C. An adjuster who, during the time period prior to renewal,
3100	5411		participates in an approved professional designation program shall
3101	5412		be deemed to have met the biennial req uirement for continuing
3102	5413		education. Each course in the curriculum for the program shall
3103	5414		total a minimum of twenty -four (24) hours. Each approved
3104	5415		professional designation program included in this section shall be
3105	5416		reviewed for quality and compliance every t hree (3) years in
3106	5417		accordance with standardized criteria promulgated by rule.
3107	5418		Continuation of approved status is contingent upon the findings of
3108	5419		the review. The list of professional designation programs approved
3109	5420		under this subsection shall be made availab le to producers and
3110	5421		providers annually.
3111		-
3112		-	ENR. S. B. NO. 887 Page 72
3113		-
3114	5422		D. The Insurance Department may promulgate rules providing that
3115	5423		courses or programs offered by professional associations shall
3116	5424		qualify for presumptive continuing education credit approval. The
3117	5425		rules shall include s tandardized criteria for reviewing the
3118	5426		professional associations' mission, membership, and other relevant
3119	5427		information, and shall provide a procedure for the Department to
3120	5428		disallow a presumptively approved course. Professional association
3121	5429		courses approved in accordance with this subsection shall be
3122	5430		reviewed every three (3) years to determine whether they continue to
3123	5431		qualify for continuing education credit.
3124	5432
	5433	+	ENGR. S. B. NO. 887 Page 106 1
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	5457	+
3125	5458		E. The active service of a licensed adjuster as a member of a
3126	5459		continuing education advisory committee , as described in paragraph 2
3127	5460		of subsection B of this section, shall be deemed to qualify for
3128	5461		continuing education credit on an hour -for-hour basis.
3129		-
3130	5462		F. 1. Each provider of continuing education shall, after
3131	5463		approval by the Commissioner, submit an annual f ee. A fee may be
3132	5464		assessed for each course submission at the time it is first
3133	5465		submitted for review and upon submission for renewal at expiration.
3134	5466		Annual fees and course submission fees shall be set forth as a rule
3135	5467		by the Commissioner. The fees are payabl e to the Insurance
3136	5468		Commissioner and shall be deposited in the State Insurance
3137	5469		Commissioner Revolving Fund, created in Section 307.3 of this title,
3138	5470		for the purposes of fulfilling and accomplishing the conditions and
3139	5471		purposes of the Oklahoma Producer Licensi ng Act and the Insurance
3140	5472		Adjusters Licensing Act. Public -funded educational institutions,
3141	5473		federal agencies, nonprofit organizations, not -for-profit
3142	5474		organizations and Oklahoma state agencies shall be exempt from this
3143	5475		subsection.
3144		-
3145	5476		2. The Commissioner may as sess a civil penalty, after notice
3146	5477		and opportunity for hearing, against a continuing education provider
3147	5478		who fails to comply with the requirements of the Insurance Adjusters
3148	5479		Licensing Act, of not less than One Hundred Dollars ($100.00) nor
3149	5480		more than Five Hundred Dollars ($500.00), for each occurrence. The
	5481	+
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	5506	+
3150	5507		civil penalty may be enforced in the same manner in which civil
3151	5508		judgments may be enforced.
3152		-
3153	5509		G. Subject to the right of the Commissioner to suspend, revoke,
3154	5510		or refuse to renew a license of an adjuster, any such license may be
3155		-
3156		-	ENR. S. B. NO. 887 Page 73
3157	5511		renewed by filing on the form prescribed by the Commissioner on or
3158	5512		before the expiration date a written request by or on behalf of the
3159	5513		licensee for such renewal and proof of completion of the continuing
3160	5514		education requirement set forth i n subsection B of this section,
3161	5515		accompanied by payment of the renewal fee.
3162		-
3163	5516		H. If the request, proof of compliance with the continuing
3164	5517		education requirement and fee for renewal of a license as an
3165	5518		adjuster are filed with the Commissioner prior to the expira tion of
3166	5519		the existing license, the licensee may continue to act pursuant to
3167	5520		said license, unless revoked or suspended prior to the expiration
3168	5521		date, until the issuance of a renewal license or until the
3169	5522		expiration of ten (10) days after the Commissioner has r efused to
3170	5523		renew the license and has mailed notice of said refusal to the
3171	5524		licensee. Any request for renewal filed after the date of
3172	5525		expiration may be considered by the Commissioner as an application
3173	5526		for a new license.
3174		-
3175		-	SECTION 33. NEW LAW A new section of law to be codif ied
	5527	+	SECTION 34. NEW LAW A new section of law to be codified
3176	5528		in the Oklahoma Statutes as Section 6470.35 of Title 36, unless
3177	5529		there is created a duplication in numbering, reads as follows:
3178	5530
	5531	+	ENGR. S. B. NO. 887 Page 108 1
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	5555	+
3179	5556		A. As used in this section, "dormant captive insurance company "
3180	5557		means a captive insuran ce company that has:
3181		-
3182	5558		1. Ceased transacting the business of insurance, including the
3183	5559		issuance of insurance policies; and
3184		-
3185	5560		2. No remaining liabilities associated with insurance business
3186	5561		transactions or insurance policies issued prior to the filing of its
3187	5562		application for a certificate of dormancy under this section.
3188		-
3189	5563		B. A dormant captive insurance company domiciled in this state
3190	5564		that meets the criteria of subsection A of this section may apply to
3191	5565		the Insurance Commissioner for a certificate of dormancy. The
3192	5566		certificate of dormancy shall be subject to renewal every five (5)
3193	5567		years and shall be forfeited if not renewed within such time.
3194		-
3195	5568		C. A dormant captive insurance company that has been issued a
3196	5569		certificate of dormancy shall:
3197		-
3198		-
3199		-	ENR. S. B. NO. 887 Page 74
3200	5570		1. Possess and thereafter mainta in unimpaired, paid-in capital
3201	5571		and surplus of not less than Twenty -five Thousand Dollars
3202	5572		($25,000.00);
3203		-
3204	5573		2. Submit on or before March 1 of each year to the Insurance
3205	5574		Commissioner a report of its financial condition, verified by an
3206	5575		oath of two of its executi ve officers, in a form prescribed by the
3207	5576		Insurance Commissioner; and
3208		-
3209	5577		3. Pay a nonrefundable renewal fee of Five Hundred Dollars
3210	5578		($500.00).
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3211	5604
3212	5605		D. A dormant captive insurance company shall not be subject to
3213	5606		or liable for the payment of any tax under Section 6 753 of Title 36
3214	5607		of the Oklahoma Statutes.
3215		-
3216	5608		E. A dormant captive insurance company shall apply to the
3217	5609		Insurance Commissioner for approval to surrender its certificate of
3218	5610		dormancy and resume conducting the business of insurance prior to
3219	5611		issuing any insurance policies.
3220		-
3221	5612		F. A certificate of dormancy shall be revoked if a dormant
3222	5613		captive insurance company no longer meets the criteria of subsection
3223	5614		A of this section.
3224		-
3225	5615		G. A dormant captive insurance company may be subject to
3226	5616		examination under Section 6470.13 of Ti tle 36 of the Oklahoma
3227	5617		Statutes for any year when it did not qualify as a dormant captive
3228	5618		insurance company. The Insurance Commissioner may examine a dormant
3229	5619		captive insurance company pursuant to Section 6470.13 of Title 36 of
3230	5620		the Oklahoma Statutes.
3231		-
3232	5621		H. The Insurance Commissioner may promulgate and adopt rules
3233	5622		and regulations implementing the provisions of this section.
3234		-
3235		-	SECTION 34. AMENDATORY 3 6 O.S. 2011, Section 6552, is
	5623	+	SECTION 35. AMENDATORY 36 O.S. 2011, Section 6552, is
3236	5624		amended to read as follows:
3237		-
3238	5625		Section 6552. As used in the H ospital and Medical Services
3239	5626		Utilization Review Act:
3240		-
3241		-
3242		-	ENR. S. B. NO. 887 Page 75
3243	5627		1. "Utilization review" means a system for prospectively,
3244	5628		concurrently and retrospectively reviewing the appropriate and
	5629	+
	5630	+	ENGR. S. B. NO. 887 Page 110 1
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	5654	+
3245	5655		efficient allocation of hospital resources and medical services
3246	5656		given or proposed to be given to a patient or group of patients. It
3247	5657		does not include an insurer's normal claim review process to
3248	5658		determine compliance with the specific terms and conditions of the
3249	5659		insurance policy;
3250		-
3251	5660		2. "Private review agent" means a person or entity who pe rforms
3252	5661		utilization review on behalf of:
3253		-
3254	5662		a. an employer in this state, or
3255		-
3256	5663		b. a third party that provides or administers hospital
3257	5664		and medical benefits to citizens of this state,
3258	5665		including, but not limited to:
3259		-
3260	5666		(1) a health maintenance organization issued a
3261	5667		license pursuant to Section 2501 et seq. of Title
3262	5668		63 of the Oklahoma Statutes, unless the health
3263	5669		maintenance organization is federally regulated
3264	5670		and licensed and has on file with the Insurance
3265	5671		Commissioner of Health a plan of utilization
3266	5672		review carried out b y health care professionals
3267	5673		and providing for complaint and appellate
3268	5674		procedures for claims, or
3269		-
3270	5675		(2) a health insurer, not -for-profit hospital service
3271	5676		or medical plan, health insurance service
3272	5677		organization, or preferred provider organization
	5678	+
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	5703	+
3273	5704		or other entity offering health insurance
3274	5705		policies, contracts or benefits in this state;
3275		-
3276	5706		3. "Utilization review plan" means a description of utilization
3277	5707		review procedures;
3278		-
3279	5708		4. "Commissioner" means the Insurance Commissioner;
3280		-
3281	5709		5. "Certificate" means a certificate of regi stration granted by
3282	5710		the Insurance Commissioner to a private review agent; and
3283		-
3284		-
3285		-	ENR. S. B. NO. 887 Page 76
3286	5711		6. "Health care provider" means any person, firm, corporation
3287	5712		or other legal entity that is licensed, certified, or otherwise
3288	5713		authorized by the laws of this state to provide hea lth care
3289	5714		services, procedures or supplies in the ordinary course of business
3290	5715		or practice of a profession.
3291		-
3292		-	SECTION 35. AMENDATORY 36 O.S. 2011, Section 6753, as
	5716	+	SECTION 36. AMENDATORY 36 O.S. 2011, Section 6753, as
3293	5717		amended by Section 38, Chapter 150, O.S.L. 2012 (36 O.S. Supp. 2020,
3294	5718		Section 6753), is amended to read as follows:
3295		-
3296	5719		Section 6753. A. Home service contracts shall not be issued,
3297	5720		sold or offered for sale in this state unless the provider has:
3298		-
3299	5721		1. Provided a receipt for, or other written evidence of, the
3300	5722		purchase of the home se rvice contract to the contract holder; and
3301		-
3302	5723		2. Provided a copy of the home service contract to the service
3303	5724		contract holder within a reasonable period of time from the date of
3304	5725		purchase.
3305		-
3306	5726		B. Each provider of home service contracts sold in this state
3307	5727		shall file a registration with, and on a form prescribed by, the
	5728	+
	5729	+	ENGR. S. B. NO. 887 Page 112 1
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	5753	+
3308	5754		Insurance Commissioner consisting of their name, full corporate
3309	5755		physical street address, telephone number, contact person and a
3310	5756		designated person in this state for service of process. Each
3311	5757		provider shall pay to the Commissioner a fee in the amount of One
3312	5758		Thousand Two Hundred Dollars ($1,200.00) upon initial registration
3313	5759		and every three (3) years thereafter. Each provider shall pay to
3314	5760		the Commissioner an Antifraud Assessment Fee of Two Thousand Two
3315	5761		Hundred Fifty Dollars ($2,250.00) upon initial registration and
3316	5762		every three (3) years thereafter. The registration need only be
3317	5763		updated by written notification to the Commissioner if material
3318	5764		changes occur in the registration on file. A proper registratio n is
3319	5765		de facto a license to conduct business in Oklahoma and may be
3320	5766		suspended as provided in Section 6755 of this title. Fees received
3321	5767		from home service contract providers shall not be subject to any
3322	5768		premium tax, but shall be subject to an administrative f ee equal to
3323	5769		two percent (2%) of the gross fees received on the sale of all home
3324	5770		service contracts issued in this state during the preceding calendar
3325	5771		quarter. The fees shall be paid quarterly to the Commissioner and
3326	5772		submitted along with a report on a form prescribed by the
3327	5773		Commissioner. However, service contract providers may elect to pay
3328		-
3329		-	ENR. S. B. NO. 887 Page 77
3330	5774		an annual administrative fee of Three Thousand Dollars ($3,000.00)
3331	5775		in lieu of the two-percent administrative fee, if the provider
3332	5776		maintains an insurance policy as provide d in paragraph 3 of
3333	5777		subsection C of this section.
3334	5778
	5779	+	ENGR. S. B. NO. 887 Page 113 1
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	5803	+
3335	5804		C. In order to assure the faithful performance of a provider's
3336	5805		obligations to its contract holders, each provider shall be
3337	5806		responsible for complying with the requirements of paragraph 1, 2 or
3338	5807		3 of this subsection:
3339		-
3340	5808		1. a. maintain a funded reserve account for its obligations
3341	5809		under its contracts issued and outstanding in this
3342	5810		state. The reserves shall not be less than forty
3343	5811		percent (40%) of gross consideration received, less
3344	5812		claims paid, on the sale of the se rvice contract for
3345	5813		all in-force contracts. The reserve account shall be
3346	5814		subject to examination and review by the Commissioner,
3347	5815		and
3348		-
3349	5816		b. place in trust with the Commissioner a financial
3350	5817		security deposit, having a value of not less than five
3351	5818		percent (5%) of the gross consideration received, less
3352	5819		claims paid, on the sale of the service contract for
3353	5820		all service contracts issued and in force, but not
3354	5821		less than Twenty-five Thousand Dollars ($25,000.00),
3355	5822		consisting of one of the following:
3356		-
3357	5823		(1) a surety bond issued by an authorized surety,
3358		-
3359	5824		(2) securities of the type eligible for deposit by
3360	5825		authorized insurers in this state,
3361		-
3362	5826		(3) cash,
	5827	+
	5828	+	ENGR. S. B. NO. 887 Page 114 1
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3363	5852
3364	5853		(4) a letter of credit issued by a qualified
3365	5854		financial institution, or
3366		-
3367	5855		(5)
3368		-
3369	5856		(4) another form of security prescribed by rule
3370	5857		promulgated by the Commissioner;
3371		-
3372		-
3373		-	ENR. S. B. NO. 887 Page 78
3374	5858		2. a. maintain, or together with its parent company
3375	5859		maintain, a net worth or stockholders' equity of
3376	5860		Twenty-five Million Dollars ($25,000,000.00),
3377	5861		excluding goodwill, intangible assets, customer lists
3378	5862		and affiliated receivables, and
3379		-
3380	5863		b. upon request, provide the Commissioner with a copy of
3381	5864		the provider's or the provider's parent company's most
3382	5865		recent Form 10-K or Form 20-F filed with the
3383	5866		Securities and Exchange Commission (SEC) within the
3384	5867		last calendar year, or if the company does not fi le
3385	5868		with the SEC, a copy of the company's financial
3386	5869		statements, which shows a net worth of the provider or
3387	5870		its parent company of at least Twenty -five Million
3388	5871		Dollars ($25,000,000.00) based upon Generally Accepted
3389	5872		Accounting Principles (GAAP) accounting stan dards. If
3390	5873		the provider's parent company's Form 10 -K, Form 20-F,
3391	5874		or financial statements are filed to meet the
3392	5875		provider's financial stability requirement, then the
3393	5876		parent company shall agree to guarantee the
	5877	+
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	5902	+
3394	5903		obligations of the provider relating to service
3395	5904		contracts sold by the provider in this state; or
3396		-
3397	5905		3. Purchase an insurance policy which demonstrates to the
3398	5906		satisfaction of the Insurance Commissioner that one hundred percent
3399	5907		(100%) of its claim exposure is covered by such policy. The
3400	5908		insurance shall be obtained from an insurer that is licensed,
3401	5909		registered, or otherwise authorized to do business in this state,
3402	5910		that is rated B++ or better by A.M. Best Company, Inc., and that
3403	5911		meets the requirements of subsection D of this section. For the
3404	5912		purposes of this paragraph, the insurance policy shall contain the
3405	5913		following provisions:
3406		-
3407	5914		a. in the event that the provider is unable to fulfill
3408	5915		its obligation under contracts issued in this state
3409	5916		for any reason, including insolvency, bankruptcy, or
3410	5917		dissolution, the insurer shall pay losses and unearned
3411	5918		premiums under such plans directly to the person
3412	5919		making the claim under the contract,
3413		-
3414	5920		b. the insurer issuing the insurance policy shall assume
3415	5921		full responsibility for the administration of claims
3416		-
3417		-	ENR. S. B. NO. 887 Page 79
3418	5922		in the event of the inability of the provider to do
3419	5923		so, and
3420		-
3421	5924		c. the policy shall not be canceled or not renewed by
3422	5925		either the insurer or the provider unless sixty (60)
3423	5926		days' written notice thereof has been given to the
	5927	+
	5928	+	ENGR. S. B. NO. 887 Page 116 1
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	5952	+
3424	5953		Commissioner by the insurer before the date of such
3425	5954		cancellation or nonrenewal.
3426		-
3427	5955		D. The insurer providing the insurance policy used to satisfy
3428	5956		the financial responsibility requirements of paragraph 3 of
3429	5957		subsection C of this section shall meet one of the following
3430	5958		standards:
3431		-
3432	5959		1. The insurer shall, at the time the policy is filed with the
3433	5960		Commissioner, and continuously thereafter:
3434		-
3435	5961		a. maintain surplus as to policyholders and paid -in
3436	5962		capital of at least Fifteen Million Dollars
3437	5963		($15,000,000.00), and
3438		-
3439	5964		b. annually file copies of the audited financial
3440	5965		statements of the insurer, its National Association of
3441	5966		Insurance Commissioners (NAIC) Annual Statement, and
3442	5967		the actuarial certification required by and filed in
3443	5968		the state of domicile of the insurer; or
3444		-
3445	5969		2. The insurer shall, at the time the policy is filed with the
3446	5970		Commissioner, and co ntinuously thereafter:
3447		-
3448	5971		a. maintain surplus as to policyholders and paid -in
3449	5972		capital of less than Fifteen Million Dollars
3450	5973		($15,000,000.00),
3451		-
3452	5974		b. demonstrate to the satisfaction of the Commissioner
3453	5975		that the company maintains a ratio of net written
3454	5976		premiums, wherever written, to surplus as to
	5977	+
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	6002	+
3455	6003		policyholders and paid -in capital of not greater than
3456	6004		three to one, and
3457		-
3458	6005		c. annually file copies of the audited financial
3459	6006		statements of the insurer, its NAIC Annual Statement,
3460		-
3461		-	ENR. S. B. NO. 887 Page 80
3462	6007		and the actuarial certification required by and f iled
3463	6008		in the state of domicile of the insurer.
3464		-
3465	6009		E. Except for the registration requirements in subsection B of
3466	6010		this section, providers, administrators and other persons marketing,
3467	6011		selling or offering to sell home service contracts are exempt from
3468	6012		any licensing requirements of this state and shall not be subject to
3469	6013		other registration information or security requirements. Home
3470	6014		service contract providers as defined in Section 6752 of this title
3471	6015		and properly registered under this law are exempt from any treatme nt
3472	6016		pursuant to the Service Warranty Act. Home service contract
3473	6017		providers applying for registration under the Oklahoma Home Service
3474	6018		Contract Act that have not been registered in the preceding twelve
3475	6019		(12) months under the Oklahoma Home Service Contract Act may be
3476	6020		subject to a thirty-day prior review before their registration is
3477	6021		deemed complete. Said applications shall be deemed complete after
3478	6022		thirty (30) days unless the Commissioner takes action in that period
3479	6023		under Section 6755 of this title, for cause sho wn, to suspend their
3480	6024		registration.
3481		-
3482	6025		F. The marketing, sale, offering for sale, issuance, making,
3483	6026		proposing to make and administration of home service contracts by
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	6050	+	23
	6051	+	24
	6052	+
3484	6053		providers and related service contract sellers, administrators, and
3485	6054		other persons, including but not limited to real estate licensees,
3486	6055		shall be exempt from all other provisions of the Insurance Code.
3487		-
3488		-	SECTION 36. AMENDATORY 36 O.S. 2011 , Section 6904, is
	6056	+	SECTION 37. AMENDATORY 36 O.S. 2011, Section 6904, is
3489	6057		amended to read as follows:
3490		-
3491	6058		Section 6904. A. 1. Upon receipt of an application for
3492	6059		issuance of a certificate of authority, the Insurance Commissioner
3493	6060		shall forthwith transmit copies of such application and accompanying
3494	6061		documents to the State Commissioner of Health.
3495		-
3496	6062		2. The State Commissioner of Health shall within forty-five
3497	6063		(45) days determine whether the applicant for a certificate of
3498	6064		authority, with respect to health care services to be furnished, has
3499	6065		complied with the provisions of Section 7 6907 of this act title.
3500		-
3501	6066		3. Within forty-five (45) days of receipt of an appli cation for
3502	6067		issuance of a certificate of authority from the Insurance
3503	6068		Commissioner, the State Commissioner of Health shall certify to the
3504		-
3505		-	ENR. S. B. NO. 887 Page 81
3506	6069		Insurance Commissioner that the proposed health maintenance
3507	6070		organization meets the requirements of Section 7 of this ac t, or
3508	6071		shall notify the Insurance Commissioner that the proposed health
3509	6072		maintenance organization does not meet such requirements and shall
3510	6073		specify in what respects the applicant is deficient.
3511		-
3512	6074		B. The Insurance Commissioner shall, within forty -five (45)
3513	6075		days of receipt of a certification of determining compliance or
3514	6076		notice of deficiency from the State Commissioner of Health , issue a
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	6100	+	23
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	6102	+
3515	6103		certificate of authority to a person filing a completed application
3516	6104		upon receipt of the prescribed fees and upon the Insurance
3517	6105		Commissioner's being satisfied that:
3518		-
3519	6106		1. The persons responsible for the conduct of the affairs of
3520	6107		the applicant are competent and trustworthy, and possess good
3521	6108		reputations;
3522		-
3523	6109		2. Any deficiency identified by the State Commissioner of
3524	6110		Health has been corrected and the State Commissioner of Health has
3525	6111		certified to the Insurance Commissioner has determined that the
3526	6112		health maintenance organization's proposed plan of operation meets
3527	6113		the requirements of Section 7 6907 of this act title;
3528		-
3529	6114		3. The health maintenance o rganization will effectively provide
3530	6115		or arrange for the provision of basic health care services on a
3531	6116		prepaid basis, through insurance or otherwise, except to the extent
3532	6117		of reasonable requirements for copayments or deductibles, or both;
3533	6118		and
3534		-
3535	6119		4. The health maintenance organization is in compliance with
3536	6120		the provisions of Sections 13 6913 and 15 6915 of this act title.
3537		-
3538	6121		C. A certificate of authority shall be denied only after the
3539	6122		Insurance Commissioner complies with the requirements of Section 20
3540	6123		6920 of this act title. No other criteria may be used to deny a
3541	6124		certificate of authority.
3542		-
3543		-	SECTION 37. AMENDATORY 36 O.S . 2011, Section 6907, is
	6125	+	SECTION 38. AMENDATORY 36 O.S. 2011, Section 6907, is
3544	6126		amended to read as follows:
	6127	+
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3545	6152
3546	6153		Section 6907. A. Every health maintenance organization shall
3547	6154		establish procedures that ensure that health care services provided
3548		-
3549		-	ENR. S. B. NO. 887 Page 82
3550	6155		to enrollees shall be rendered under reasonable standards of quality
3551	6156		of care consistent with prevailing professionally recognized
3552	6157		standards of medical practice. The procedures shall include
3553	6158		mechanisms to assure availability, accessibility and continuity of
3554	6159		care.
3555		-
3556	6160		B. The health maintenance organization shall have an ongoing
3557	6161		internal quality assurance program to monitor and evaluate its
3558	6162		health care services, including primary and specialist physician
3559	6163		services and ancillary and preventive health care services across
3560	6164		all institutional and noninstitutional settings. The program shall
3561	6165		include, but need not be limited to, the following:
3562		-
3563	6166		1. A written statement of goals and objectives that emphasizes
3564	6167		improved health status in evaluating the quality of care rendered to
3565	6168		enrollees;
3566		-
3567	6169		2. A written quality assurance plan that describes the
3568	6170		following:
3569		-
3570	6171		a. the health maintenance organization's scope and
3571	6172		purpose in quality assurance,
3572		-
3573	6173		b. the organizational structure r esponsible for quality
3574	6174		assurance activities,
3575		-
3576	6175		c. contractual arrangements, where appropriate, for
3577	6176		delegation of quality assurance activities,
3578	6177
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3579	6203		d. confidentiality policies and procedures,
3580		-
3581	6204		e. a system of ongoing evaluation activities,
3582		-
3583	6205		f. a system of focused ev aluation activities,
3584		-
3585	6206		g. a system for credentialing and recredentialing
3586	6207		providers, and performing peer review activities, and
3587		-
3588	6208		h. duties and responsibilities of the designated
3589	6209		physician responsible for the quality assurance
3590	6210		activities;
3591		-
3592		-
3593		-	ENR. S. B. NO. 887 Page 83
3594	6211		3. A written statemen t describing the system of ongoing quality
3595	6212		assurance activities including:
3596		-
3597	6213		a. problem assessment, identification, selection and
3598	6214		study,
3599		-
3600	6215		b. corrective action, monitoring, evaluation and
3601	6216		reassessment, and
3602		-
3603	6217		c. interpretation and analysis of patterns of care
3604	6218		rendered to individual patients by individual
3605	6219		providers;
3606		-
3607	6220		4. A written statement describing the system of focused quality
3608	6221		assurance activities based on representative samples of the enrolled
3609	6222		population that identifies method of topic selection, study, data
3610	6223		collection, analysis, interpretation and report format; and
3611		-
3612	6224		5. Written plans for taking appropriate corrective action
3613	6225		whenever, as determined by the quality assurance program,
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	6251	+
3614	6252		inappropriate or substandard services have been provided or services
3615	6253		that should have been furnished have not been provided.
3616		-
3617	6254		C. The organization shall record proceedings of formal quality
3618	6255		assurance program activities and maintain documentation in a
3619	6256		confidential manner. Quality assurance program minutes shall be
3620	6257		available to the State Insurance Commissioner of Health.
3621		-
3622	6258		D. The organization shall ensure the use and maintenance of an
3623	6259		adequate patient record system which will facilitate documentation
3624	6260		and retrieval of clinical information for the purpose of the health
3625	6261		maintenance organizati on's evaluating continuity and coordination of
3626	6262		patient care and assessing the quality of health and medical care
3627	6263		provided to enrollees.
3628		-
3629	6264		E. Enrollee clinical records shall be available to the State
3630	6265		Insurance Commissioner of Health or an authorized designee for
3631	6266		examination and review to ascertain compliance with this section, or
3632	6267		as deemed necessary by the State Insurance Commissioner of Health.
3633		-
3634		-
3635		-	ENR. S. B. NO. 887 Page 84
3636	6268		F. The organization shall establish a mechanism for periodic
3637	6269		reporting of quality assurance program activities to the governing
3638	6270		body, providers and appropriate organization staff.
3639		-
3640	6271		G. The organization shall be required to establish a mechanism
3641	6272		under which physicians participating in the plan may provide input
3642	6273		into the plan's medical policy including, but not limited t o,
3643	6274		coverage of new technology and procedures, utilization review
	6275	+
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	6300	+
3644	6301		criteria and procedures, quality, credentialing and recredentialing
3645	6302		criteria, and medical management procedures.
3646		-
3647	6303		H. As used in this section "credentialing" or
3648	6304		"recredentialing", as applied t o physicians and other health care
3649	6305		providers, means the process of accessing and validating the
3650	6306		qualifications of such persons to provide health care services to
3651	6307		the beneficiaries of a health maintenance organization.
3652	6308		"Credentialing" or "recredentialing" may include, but need not be
3653	6309		limited to, an evaluation of licensure status, education, training,
3654	6310		experience, competence and professional judgment. Credentialing or
3655	6311		recredentialing is a prerequisite to the final decision of a health
3656	6312		maintenance organizatio n to permit initial or continued
3657	6313		participation by a physician or other health care provider.
3658		-
3659	6314		1. Physician credentialing and recredentialing shall be based
3660	6315		on criteria as provided in the uniform credentialing application
3661	6316		required by Section 1 -106.2 of Title 63 of the Oklahoma Statutes,
3662	6317		with input from physicians and other health care providers.
3663		-
3664	6318		2. Organizations shall make information on credentialing and
3665	6319		recredentialing criteria available to physician applicants and other
3666	6320		health care providers, participati ng physicians, and other
3667	6321		participating health care providers and shall provide applicants
3668	6322		with a checklist of materials required in the application process.
3669		-
3670	6323		3. When economic considerations are part of the credentialing
3671	6324		and recredentialing decision, object ive criteria shall be used and
	6325	+
	6326	+	ENGR. S. B. NO. 887 Page 124 1
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	6350	+
3672	6351		shall be available to physician applicants and participating
3673	6352		physicians. When graduate medical education is a consideration in
3674	6353		the credentialing and recredentialing process, equal recognition
3675	6354		shall be given to training progr ams accredited by the Accrediting
3676	6355		Council on Graduate Medical Education and by the American
3677	6356		Osteopathic Association. When graduate medical education is
3678		-
3679		-	ENR. S. B. NO. 887 Page 85
3680	6357		considered for optometric physicians, consideration shall be given
3681	6358		for educational accreditation by the Council on Optometric
3682	6359		Education.
3683		-
3684	6360		4. Physicians or other health care providers under
3685	6361		consideration to provide health care services under a managed care
3686	6362		plan in this state shall apply for credentialing and recredentialing
3687	6363		on the uniform credentialing appli cation and provide the
3688	6364		documentation as outlined by the plan's checklist of materials
3689	6365		required in the application process.
3690		-
3691	6366		5. A health maintenance organization (HMO) shall determine
3692	6367		whether a credentialing or recredentialing application is complete.
3693	6368		If an application is determined to be incomplete, the plan shall
3694	6369		notify the applicant in writing within ten (10) calendar days of
3695	6370		receipt of the application. The written notice shall specify the
3696	6371		portion of the application that is causing a delay in processing and
3697	6372		explain any additional information or corrections needed.
3698	6373
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	6398	+
3699	6399		6. In reviewing the application, the health maintenance
3700	6400		organization (HMO) shall evaluate each application according to the
3701	6401		plan's checklist of materials required in the application process.
3702		-
3703	6402		7. When an application is deemed complete, the HMO shall
3704	6403		initiate requests for primary source verification and malpractice
3705	6404		history within seven (7) calendar days.
3706		-
3707	6405		8. A malpractice carrier shall have twenty -one (21) calendar
3708	6406		days within which to respond af ter receipt of an inquiry from a
3709	6407		health maintenance organization (HMO). Any malpractice carrier that
3710	6408		fails to respond to an inquiry within the allotted time frame may be
3711	6409		assessed an administrative penalty by the State Insurance
3712	6410		Commissioner of Health.
3713		-
3714	6411		9. Upon receipt of primary source verification and malpractice
3715	6412		history by the HMO, the HMO shall determine if the application is a
3716	6413		clean application. If the application is deemed clean, the HMO
3717	6414		shall have forty-five (45) calendar days within which to creden tial
3718	6415		or recredential a physician or other health care provider. As used
3719	6416		in this paragraph, "clean application" means an application that has
3720	6417		no defect, misstatement of facts, improprieties, including a lack of
3721	6418		any required substantiating documentation, or particular
3722		-
3723		-	ENR. S. B. NO. 887 Page 86
3724	6419		circumstance requiring special treatment that impedes prompt
3725	6420		credentialing or recredentialing.
3726		-
3727	6421		10. If a health maintenance organization is unable to
3728	6422		credential or recredential a physician or other health care provider
	6423	+
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	6448	+
3729	6449		due to an application's n ot being clean, the HMO may extend the
3730	6450		credentialing or recredentialing process for sixty (60) calendar
3731	6451		days. At the end of sixty (60) calendar days, if the HMO is
3732	6452		awaiting documentation to complete the application, the physician or
3733	6453		other health care prov ider shall be notified of the delay by
3734	6454		certified mail. The physician or other health care provider may
3735	6455		extend the sixty-day period upon written notice to the HMO within
3736	6456		ten (10) calendar days; otherwise the application shall be deemed
3737	6457		withdrawn.
3738		-
3739	6458		11. In no event shall the entire credentialing or
3740	6459		recredentialing process exceed one hundred eighty (180) calendar
3741	6460		days.
3742		-
3743	6461		12. A health maintenance organization shall be prohibited from
3744	6462		solely basing a denial of an application for credentialing or
3745	6463		recredentialing on the lack of board certification or board
3746	6464		eligibility and from adding new requirements solely for the purpose
3747	6465		of delaying an application.
3748		-
3749	6466		13. Any HMO that violates the provisions of this subsection may
3750	6467		be assessed an administrative penalty by the State Insurance
3751	6468		Commissioner of Health.
3752		-
3753	6469		I. Health maintenance organizations shall not discriminate
3754	6470		against enrollees with expensive medical conditions by excluding
3755	6471		practitioners with practices containing a substantial number of
3756	6472		these patients.
	6473	+
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3757	6498
3758	6499		J. Health maintenance organizations shall, upon request,
3759	6500		provide to a physician whose contract is terminated or not renewed
3760	6501		for cause the reasons for termination or nonrenewal. Health
3761	6502		maintenance organizations shall not contractually prohibit such
3762	6503		requests.
3763		-
3764	6504		K. No HMO shall engage in the practice of medicine or any other
3765	6505		profession except as provided by law nor shall an HMO include any
3766		-
3767		-	ENR. S. B. NO. 887 Page 87
3768	6506		provision in a provider contract that precludes or discourages a
3769	6507		health maintenance organization's providers from:
3770		-
3771	6508		1. Informing a patient of the care the patient requires,
3772	6509		including treatments or services not provided or reimbursed under
3773	6510		the patient's HMO; or
3774		-
3775	6511		2. Advocating on behalf of a patient before the HMO.
3776		-
3777	6512		L. Decisions by a health maintenance organization to authorize
3778	6513		or deny coverage for an emergency service shall be based on the
3779	6514		patient presenting symptoms arising from any injury, illness, or
3780	6515		condition manifesting itself by acute symptoms of sufficient
3781	6516		severity, including severe pain, such that a reasonable and prudent
3782	6517		layperson could expect the absence of medical attention to result in
3783	6518		serious:
3784		-
3785	6519		1. Jeopardy to the health of the patient;
3786		-
3787	6520		2. Impairment of bodily function; or
3788		-
3789	6521		3. Dysfunction of any bodily organ or part.
	6522	+
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3790	6547
3791	6548		M. Health maintenance organizations shall not deny an otherwise
3792	6549		covered emergency service based solely upon lack of notification to
3793	6550		the HMO.
3794		-
3795	6551		N. Health maintenance organizations shall compensate a provider
3796	6552		for patient screening, evaluation, and examination services that are
3797	6553		reasonably calculated to assist the provider i n determining whether
3798	6554		the condition of the patient requires emergency service. If the
3799	6555		provider determines that the patient does not require emergency
3800	6556		service, coverage for services rendered subsequent to that
3801	6557		determination shall be governed by the HMO con tract.
3802		-
3803	6558		O. If within a period of thirty (30) minutes after receiving a
3804	6559		request from a hospital emergency department for a specialty
3805	6560		consultation, a health maintenance organization fails to identify an
3806	6561		appropriate specialist who is available and willing to assume the
3807	6562		care of the enrollee, the emergency department may arrange for
3808	6563		emergency services by an appropriate specialist that are medically
3809	6564		necessary to attain stabilization of an emergency medical condition,
3810		-
3811		-	ENR. S. B. NO. 887 Page 88
3812	6565		and the HMO shall not deny coverage for the se rvices due to lack of
3813	6566		prior authorization.
3814		-
3815	6567		P. The reimbursement policies and patient transfer requirements
3816	6568		of a health maintenance organization shall not, directly or
3817	6569		indirectly, require a hospital emergency department or provider to
3818	6570		violate the federal E mergency Medical Treatment and Active Labor
3819	6571		Act. If a member of an HMO is transferred from a hospital emergency
	6572	+
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	6575	+	3
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	6583	+	11
	6584	+	12
	6585	+	13
	6586	+	14
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	6588	+	16
	6589	+	17
	6590	+	18
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	6592	+	20
	6593	+	21
	6594	+	22
	6595	+	23
	6596	+	24
	6597	+
3820	6598		department facility to another medical facility, the HMO shall
3821	6599		reimburse the transferring facility and provider for services
3822	6600		provided to attain stabilization of the emergency medical condition
3823	6601		of the member in accordance with the federal Emergency Medical
3824	6602		Treatment and Active Labor Act.
3825		-
3826		-	SECTION 38. AMENDATORY 36 O.S. 2011, Section 6911, is
	6603	+	SECTION 39. AMENDATORY 36 O.S. 2011, Section 6911, is
3827	6604		amended to read as follows:
3828		-
3829	6605		Section 6911. A. Every health maintenance organization shall
3830	6606		establish and maintain a grievance procedure that has been approved
3831	6607		by the Insurance Commissioner , after consultation with the State
3832	6608		Commissioner of Health, to provide for the resolution of grievan ces
3833	6609		initiated by enrollees. Such grievance procedure shall be approved
3834	6610		by the Insurance Commissioner within thirty (30) days of submission.
3835	6611		The health maintenance organization shall maintain a record of
3836	6612		grievances received since the date of its last exam ination of
3837	6613		grievances.
3838		-
3839	6614		B. The Insurance Commissioner or the State Commissioner of
3840	6615		Health may examine the grievance procedures.
3841		-
3842	6616		C. Health maintenance organizations shall comply with the
3843	6617		requirements of an insurer as set out in Sections 1250.1 through
3844	6618		1250.16 of Title 36 of the Oklahoma Statutes this title.
3845		-
3846		-	SECTION 39. AMENDATORY 36 O.S. 2011, Section 6919, is
	6619	+	SECTION 40. AMENDATORY 36 O.S. 2011, Section 6919, is
3847	6620		amended to read as follows:
	6621	+
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	6638	+	17
	6639	+	18
	6640	+	19
	6641	+	20
	6642	+	21
	6643	+	22
	6644	+	23
	6645	+	24
3848	6646
3849	6647		Section 6919. A. The Insurance Commissioner may make an
3850	6648		examination of the affairs of any heal th maintenance organization,
3851	6649		producers and providers with whom the organization has contracts,
3852	6650		agreements or other arrangements pursuant to the provisions of
3853		-
3854		-	ENR. S. B. NO. 887 Page 89
3855	6651		Sections 309.1 through 309.7 of Title 36 of the Oklahoma Statutes
3856	6652		this title.
3857		-
3858	6653		B. The State Insurance Commissioner of Health may require a
3859	6654		health maintenance organization to contract for an examination
3860	6655		concerning the quality assurance program of the health maintenance
3861	6656		organization and of any providers with whom the organization has
3862	6657		contracts, agreement s or other arrangements as often as is
3863	6658		reasonably necessary for the protection of the interests of the
3864	6659		people of this state, but not less frequently than once every three
3865	6660		(3) years.
3866		-
3867	6661		C. Every health maintenance organization and provider shall
3868	6662		submit its books and records for examination and in every way
3869	6663		facilitate the completion of an examination. For the purpose of an
3870	6664		examination, the Insurance Commissioner and the State Commissioner
3871	6665		of Health may administer oaths to, and examine the officers and
3872	6666		agents of the health maintenance organization and the principals of
3873	6667		the providers concerning their business.
3874		-
3875	6668		D. Any health maintenance organization examined shall pay the
3876	6669		proper charges incurred in such examination, including the actual
3877	6670		expense of the Insurance C ommissioner or State Commissioner of
	6671	+
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	6696	+
3878	6697		Health or the expenses and compensation of any authorized
3879	6698		representative and the expense and compensation of assistants and
3880	6699		examiners employed therein. All expenses incurred in such
3881	6700		examination shall be verified by aff idavit and a copy shall be filed
3882	6701		in the office of the Insurance Commissioner or the State
3883	6702		Commissioner of Health .
3884		-
3885	6703		E. In lieu of an examination, the Insurance Commissioner or
3886	6704		State Commissioner of Health may accept the report of an examination
3887	6705		made by the health maintenance organization regulatory entity of
3888	6706		another state.
3889		-
3890		-	SECTION 40. AMENDATORY 36 O.S. 2011, Section 6920, is
	6707	+	SECTION 41. AMENDATORY 36 O.S. 2011, Section 6920, is
3891	6708		amended to read as follows:
3892		-
3893	6709		Section 6920. A. A certificate of authority issued under the
3894	6710		Health Maintenance Organization Act of 2003 may be suspended or
3895	6711		revoked, and an application for a certificate of authority may be
3896		-
3897		-	ENR. S. B. NO. 887 Page 90
3898	6712		denied, if the Insurance Commissioner finds that any of the
3899	6713		following conditions exist:
3900		-
3901	6714		1. The health maintenance organization (HMO) is operati ng
3902	6715		significantly in contravention of its basic organizational document
3903	6716		or in a manner contrary to that described in any other information
3904	6717		submitted under Section 3 6903 of this act title, unless amendments
3905	6718		to those submissions have been filed with and appr oved by the
3906	6719		Insurance Commissioner;
3907	6720
	6721	+	ENGR. S. B. NO. 887 Page 132 1
	6722	+	2
	6723	+	3
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	6742	+	22
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	6744	+	24
	6745	+
3908	6746		2. The health maintenance organization issues an evidence of
3909	6747		coverage or uses a schedule of charges for health care services that
3910	6748		does not comply with the requirements of Sections 8 6908 and 16 6916
3911	6749		of this act title;
3912		-
3913	6750		3. The health maintenance organization does not provide or
3914	6751		arrange for basic health care services;
3915		-
3916	6752		4. The State Commissioner of Health certifies to the Insurance
3917	6753		Commissioner determines that:
3918		-
3919	6754		a. the health maintenance organization does not meet the
3920	6755		requirements of Section 7 6907 of this act title, or
3921		-
3922	6756		b. the health maintenance organization is unable to
3923	6757		fulfill its obligations to furnish health care
3924	6758		services;
3925		-
3926	6759		5. The health maintenance organization is no longer financially
3927	6760		responsible and may reasonably be e xpected to be unable to meet its
3928	6761		obligations to enrollees or prospective enrollees;
3929		-
3930	6762		6. The health maintenance organization has failed to correct,
3931	6763		within the time frame prescribed by subsection C of this section,
3932	6764		any deficiency occurring due to the health maintenance
3933	6765		organization's prescribed minimum net worth being impaired;
3934		-
3935	6766		7. The health maintenance organization has failed to implement
3936	6767		the grievance procedures required by Section 11 6911 of this act
3937	6768		title in a reasonable manner to resolve valid complaint s;
3938	6769
3939		-
3940		-	ENR. S. B. NO. 887 Page 91
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	6772	+	3
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	6789	+	20
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	6794	+
3941	6795		8. The health maintenance organization, or any person on its
3942	6796		behalf, has advertised or merchandised its services in an untrue,
3943	6797		misrepresentative, misleading, deceptive or unfair manner;
3944		-
3945	6798		9. The continued operation of the health maintenance
3946	6799		organization would be hazardous to its enrollees or to the public;
3947	6800		or
3948		-
3949	6801		10. The health maintenance organization has otherwise failed to
3950	6802		comply with the provisions of the Health Maintenance Organization
3951	6803		Act of 2003, or applicable rules promulgated by the Insurance
3952	6804		Commissioner pursuant thereto , or rules promulgated by the State
3953	6805		Board of Health pursuant to the provisions of Section 7 of the
3954	6806		Health Maintenance Organization Act of 2003 .
3955		-
3956	6807		B. In addition to or in lieu of suspension or revocation of a
3957	6808		certificate of authority pursuant to the provisions of this section,
3958	6809		an applicant or health maintenance organization who knowingly
3959	6810		violates the provisions of this section may be subject to an
3960	6811		administrative penalty of Five Thousand Dollars ($5,000.00) for each
3961	6812		occurrence.
3962		-
3963	6813		C. The following shall apply when insufficient net worth is
3964	6814		maintained:
3965		-
3966	6815		1. Whenever the Insurance Commissioner finds that the net worth
3967	6816		maintained by any health maintenance organization subject to the
3968	6817		provisions of this act is less than the minimum net worth req uired
3969	6818		to be maintained by Section 13 6913 of this act title, the Insurance
	6819	+
	6820	+	ENGR. S. B. NO. 887 Page 134 1
	6821	+	2
	6822	+	3
	6823	+	4
	6824	+	5
	6825	+	6
	6826	+	7
	6827	+	8
	6828	+	9
	6829	+	10
	6830	+	11
	6831	+	12
	6832	+	13
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	6834	+	15
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	6839	+	20
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	6844	+
3970	6845		Commissioner shall give written notice to the health maintenance
3971	6846		organization of the amount of the deficiency and require filing with
3972	6847		the Insurance Commissioner a plan for correctio n of the deficiency
3973	6848		that is acceptable to the Insurance Commissioner, and correction of
3974	6849		the deficiency within a reasonable time, not to exceed sixty (60)
3975	6850		days, unless an extension of time, not to exceed sixty (60)
3976	6851		additional days, is granted by the Insuran ce Commissioner. A
3977	6852		deficiency shall be deemed an impairment, and failure to correct the
3978	6853		impairment in the prescribed time shall be grounds for suspension or
3979	6854		revocation of the certificate of authority or for placing the health
3980	6855		maintenance organization in c onservation, rehabilitation or
3981	6856		liquidation; or
3982		-
3983		-
3984		-	ENR. S. B. NO. 887 Page 92
3985	6857		2. Unless allowed by the Insurance Commissioner, no health
3986	6858		maintenance organization or person acting on its behalf may,
3987	6859		directly or indirectly, renew, issue or deliver any certificate,
3988	6860		agreement or contract o f coverage in this state, for which a premium
3989	6861		is charged or collected, when the health maintenance organization
3990	6862		writing the coverage is impaired, and the fact of impairment is
3991	6863		known to the health maintenance organization or to the person;
3992	6864		provided, however, the existence of an impairment shall not prevent
3993	6865		the issuance or renewal of a certificate, agreement or contract when
3994	6866		the enrollee exercises an option granted under the plan to obtain a
3995	6867		new, renewed or converted coverage.
3996	6868
	6869	+	ENGR. S. B. NO. 887 Page 135 1
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	6886	+	18
	6887	+	19
	6888	+	20
	6889	+	21
	6890	+	22
	6891	+	23
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	6893	+
3997	6894		D. A certificate of authority s hall be suspended or revoked or
3998	6895		an application or a certificate of authority denied or an
3999	6896		administrative penalty imposed only after compliance with the
4000	6897		requirements of this section.
4001		-
4002	6898		1. Suspension or revocation of a certificate of authority,
4003	6899		denial of an application, or imposition of an administrative penalty
4004	6900		by the Insurance Commissioner, pursuant to the provisions of this
4005	6901		section, shall be by written order and shall be sent to the health
4006	6902		maintenance organization or applicant by certified or registered
4007	6903		mail and to the State Commissioner of Health . The written order
4008	6904		shall state the grounds, charges or conduct on which the suspension,
4009	6905		revocation or denial or administrative penalty is based. The health
4010	6906		maintenance organization or applicant may, in writing, r equest a
4011	6907		hearing within thirty (30) days from the date of mailing of the
4012	6908		order. If no written request is made, the order shall be final upon
4013	6909		the expiration of thirty (30) days.
4014		-
4015	6910		2. If the health maintenance organization or applicant requests
4016	6911		a hearing pursuant to the provisions of this section, the Insurance
4017	6912		Commissioner shall issue a written notice of hearing and send such
4018	6913		notice to the health maintenance organization or applicant by
4019	6914		certified or registered mail and to the State Commissioner of Health
4020	6915		stating:
4021	6916
	6917	+	ENGR. S. B. NO. 887 Page 136 1
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	6927	+	11
	6928	+	12
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	6930	+	14
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	6934	+	18
	6935	+	19
	6936	+	20
	6937	+	21
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	6939	+	23
	6940	+	24
	6941	+
4022	6942		a. a specific time for the hearing, which may not be less
4023	6943		than twenty (20) nor more than thirty (30) days after
4024	6944		mailing of the notice of hearing, and
4025		-
4026		-
4027		-	ENR. S. B. NO. 887 Page 93
4028	6945		b. that any hearing shall be held at the office of the
4029	6946		Insurance Commissioner.
4030		-
4031	6947		If a hearing is reque sted, the State Commissioner of Health or a
4032	6948		designee shall be in attendance and shall participate in the
4033	6949		proceedings. The recommendations and findings of the State
4034	6950		Commissioner of Health with respect to matters relating to the
4035	6951		quality of health care servi ces provided in connection with any
4036	6952		decision regarding denial, suspension or revocation of a certificate
4037	6953		of authority, shall be conclusive and binding upon the Insurance
4038	6954		Commissioner. After the hearing, or upon failure of the health
4039	6955		maintenance organizati on to appear at the hearing, the Insurance
4040	6956		Commissioner shall take whatever action is deemed necessary based on
4041	6957		written findings. The Insurance Commissioner shall mail the
4042	6958		decision to the health maintenance organization or applicant and a
4043	6959		copy to the State Commissioner of Health .
4044		-
4045	6960		E. The provisions of the Administrative Procedures Act shall
4046	6961		apply to proceedings under this section to the extent they are not
4047	6962		in conflict with the provisions of Section 313 of Title 36 of the
4048	6963		Oklahoma Statutes this title.
4049		-
4050	6964		F. If the certificate of authority of a health maintenance
4051	6965		organization is suspended, the health maintenance organization shall
	6966	+
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	6975	+	9
	6976	+	10
	6977	+	11
	6978	+	12
	6979	+	13
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	6989	+	23
	6990	+	24
	6991	+
4052	6992		not, during the period of suspension, enroll any additional
4053	6993		enrollees except newborn children or other newly acquired dependents
4054	6994		of existing enrollees, and shall not engage in any advertising or
4055	6995		solicitation whatsoever.
4056		-
4057	6996		G. If the certificate of authority of a health maintenance
4058	6997		organization is revoked, the HMO shall proceed, immediately
4059	6998		following the effective date of the order of rev ocation, to wind up
4060	6999		its affairs and shall conduct no further business except as may be
4061	7000		essential to the orderly conclusion of the affairs of the
4062	7001		organization. The HMO shall engage in no further advertising or
4063	7002		solicitation whatsoever. The Insurance Commis sioner may, by written
4064	7003		order, permit further operation of the HMO if found to be in the
4065	7004		best interests of enrollees, to the end that enrollees will be
4066	7005		afforded the greatest practical opportunity to obtain continuing
4067	7006		health care coverage.
4068		-
4069		-
4070		-	ENR. S. B. NO. 887 Page 94
4071		-	SECTION 41. AMENDATORY 36 O.S. 2011, Section 6929, is
	7007	+	SECTION 42. AMENDATORY 36 O.S. 2011, Section 6929, is
4072	7008		amended to read as follows:
4073		-
4074	7009		Section 6929. The State Insurance Commissioner of Health, in
4075	7010		carrying out his or her obligations under the Health Maintenance
4076	7011		Organization Act of 2003, may contract w ith qualified persons to
4077	7012		make recommendations concerning the determinations required to be
4078	7013		made by the State Insurance Commissioner of Health. The
4079	7014		recommendations may be accepted in full or in part by the State
4080	7015		Insurance Commissioner of Health. The State Insurance Commissioner
	7016	+
	7017	+	ENGR. S. B. NO. 887 Page 138 1
	7018	+	2
	7019	+	3
	7020	+	4
	7021	+	5
	7022	+	6
	7023	+	7
	7024	+	8
	7025	+	9
	7026	+	10
	7027	+	11
	7028	+	12
	7029	+	13
	7030	+	14
	7031	+	15
	7032	+	16
	7033	+	17
	7034	+	18
	7035	+	19
	7036	+	20
	7037	+	21
	7038	+	22
	7039	+	23
	7040	+	24
	7041	+
4081	7042		of Health shall adopt procedures to ensure that such persons are not
4082	7043		subject to a conflict of interest that would impair their ability to
4083	7044		make recommendations in an impartial manner.
4084		-
4085		-	SECTION 42. REPEALER 36 O.S. 2011, Sections 1435.40, as
	7045	+	SECTION 43. REPEALER 36 O. S. 2011, Sections 1435.40, as
4086	7046		amended by Section 1, Chapter 23, O.S.L. 2016 (36 O.S. Supp. 2020,
4087	7047		Sections 1435.40), 1612.1, 6221 and 6522, are hereby repealed.
4088		-
4089		-	SECTION 43. It being immediately necessary for the preservation
	7048	+	SECTION 44. It being immediately necessary for the preservation
4090	7049		of the public peace, health or safety, an emergency is hereby
4091	7050		declared to exist, by reason whereof this act shall take effect and
4092	7051		be in full force from and after its passage and approval.
4093		-
4094		-
4095		-	ENR. S. B. NO. 887 Page 95
4096		-	Passed the Senate the 5th day of May, 2021.
	7052	+	Passed the Senate the 10th day of March, 2021.
4097	7053
4098	7054
4099	7055
4100	7056		Presiding Officer of the Senate
4101	7057
4102	7058
4103		-	Passed the House of Representatives the 21st day of April, 2021.
	7059	+	Passed the House of Representatives the ____ day of __________,
	7060	+	2021.
4104	7061
4105	7062
4106	7063
4107	7064		Presiding Officer of the House
4108	7065		of Representatives
4109	7066
4110		-	OFFICE OF THE GOVERNOR
4111		-	Received by the Office of the Governor this _______ _____________
4112		-	day of _________________ __, 20_______, at _______ o'clock _______ M.
4113		-	By: _______________________________ __
4114		-	Approved by the Governor of the State of Oklahoma this _____ ____
4115		-	day of _______________ ____, 20_______, at _______ o'clock _______ M.
4116		-
4117		-	_________________________________
4118		-	Governor of the State of Oklahoma
4119		-
4120		-
4121		-	OFFICE OF THE SECRETARY OF STATE
4122		-	Received by the Office of the Secretary of State this _______ ___
4123		-	day of __________________, 20 _______, at _______ o'clock ___ ____ M.
4124		-	By: _______________________________ __
	7067	+