§ 24-60-3001 — Interstate insurance product regulation compact

The
following Compact is intended to help States join together to establish an
interstate Compact to regulate designated insurance products. Pursuant to terms
and conditions of this Act, the State of Colorado seeks to join with other States and
establish the Interstate Insurance Product Regulation Compact, and thus become a
member of the Interstate Insurance Product Regulation Commission. The insurance
commissioner is hereby designated to serve as the representative of this State to
the Commission.

ARTICLE I.

PURPOSES

The purposes of this Compact are, through means of joint and cooperative
action among the Compacting States:

1. To promote and protect the interest of consumers of individual and group
annuity, life insurance, disability income and long-term insurance products;

2. To develop uniform standards for insurance products covered under the
Compact;

3. To establish a central clearinghouse to receive and provide prompt review
of insurance products covered under the Compact and, in certain cases,
advertisements related thereto, submitted by insurers authorized to do business in
one or more Compacting States;

4. To give appropriate regulatory approval to those product filings and
advertisements satisfying the applicable uniform standard;

5. To improve coordination of regulatory resources and expertise between
state insurance departments regarding the setting of uniform standards and review
of insurance products covered under the Compact;

6. To create the Interstate Insurance Product Regulation Commission; and

7. To perform these and such other related functions as may be consistent
with the state regulation of the business of insurance.

ARTICLE II.

DEFINITIONS

For purposes of this Compact:

1. Advertisement means any material designed to create public interest in
a Product, or induce the public to purchase, increase, modify, reinstate, borrow on,
surrender, replace or retain a policy, as more specifically defined in the Rules and
Operating Procedures of the Commission.

2. Bylaws mean those bylaws established by the Commission for its
governance, or for directing or controlling the Commission's actions or conduct.

3. Compacting State means any State which has enacted this Compact
legislation and which has not withdrawn pursuant to Article XIV, Section 1, or been
terminated pursuant to Article XIV, Section 2.

4. Commission means the Interstate Insurance Product Regulation
Commission established by this Compact.

5. Commissioner means the chief insurance regulatory official of a State
including, but not limited to commissioner, superintendent, director or
administrator.

6. Domiciliary State means the state in which an Insurer is incorporated or
organized; or, in the case of an alien Insurer, its state of entry.

7. Insurer means any entity licensed by a State to issue contracts of
insurance for any of the lines of insurance covered by this Act.

8. Member means the person chosen by a Compacting State as its
representative to the Commission, or his or her designee.

9. Non-compacting State means any State which is not at the time a
Compacting State.

10. Operating Procedures mean procedures promulgated by the
Commission implementing a Rule, Uniform Standard or a provision of this Compact.

11. Product means the form of a policy or contract, including any
application, endorsement, or related form which is attached to and made a part of
the policy or contract, and any evidence of coverage or certificate, for an individual
or group annuity, life insurance, disability income or long-term care insurance
product that an Insurer is authorized to issue.

12. Rule means a statement of general or particular applicability and future
effect promulgated by the Commission, including a Uniform Standard developed
pursuant to Article VII of the Compact, designed to implement, interpret, or
prescribe law or policy or describing the organization, procedure, or practice
requirements of the Commission, which shall have the force and effect of law in the
Compacting States.

13. State means any state, district or territory of the United States of
America.

14. Third-Party Filer means an entity that submits a Product filing to the
Commission on behalf of an Insurer.

15. Uniform Standard means a standard adopted by the Commission for a
Product line, pursuant to Article VII of this Compact, and shall include all of the
Product requirements in aggregate; provided, that each Uniform Standard shall be
construed, whether express or implied, to prohibit the use of any inconsistent,
misleading or ambiguous provisions in a Product and the form of the Product made
available to the public shall not be unfair, inequitable or against public policy as
determined by the Commission.

ARTICLE III.

ESTABLISHMENT OF THE COMMISSION AND VENUE

1. The Compacting States hereby create and establish a joint public agency
known as the Interstate Insurance Product Regulation Commission. Pursuant to
Article IV, the Commission will have the power to develop Uniform Standards for
Product lines, receive and provide prompt review of Products filed therewith, and
give approval to those Product filings satisfying applicable Uniform Standards;
provided, it is not intended for the Commission to be the exclusive entity for receipt
and review of insurance product filings. Nothing herein shall prohibit any Insurer
from filing its product in any State wherein the Insurer is licensed to conduct the
business of insurance; and any such filing shall be subject to the laws of the State
where filed.

2. The Commission is a body corporate and politic, and an instrumentality of
the Compacting States.

3. The Commission is solely responsible for its liabilities except as otherwise
specifically provided in this Compact.

4. Venue is proper and judicial proceedings by or against the Commission
shall be brought solely and exclusively in a Court of competent jurisdiction where
the principal office of the Commission is located.

ARTICLE IV.

POWERS OF THE COMMISSION

The Commission shall have the following powers:

1. To promulgate Rules, pursuant to Article VII of this Compact, which shall
have the force and effect of law and shall be binding in the Compacting States to
the extent and in the manner provided in this Compact;

2. To exercise its rule-making authority and establish reasonable Uniform
Standards for Products covered under the Compact, and Advertisement related
thereto, which shall have the force and effect of law and shall be binding in the
Compacting States, but only for those Products filed with the Commission,
provided, that a Compacting State shall have the right to opt out of such Uniform
Standard pursuant to Article VII, to the extent and in the manner provided in this
Compact, and, provided further, that any Uniform Standard established by the
Commission for long-term care insurance products may provide the same or greater
protections for consumers as, but shall not provide less than, those protections set
forth in the National Association of Insurance Commissioners' Long-Term Care
Insurance Model Act and Long-Term Care Insurance Model Regulation,
respectively, adopted as of 2001. The Commission shall consider whether any
subsequent amendments to the NAIC Long-Term Care Insurance Model Act or
Long-Term Care Insurance Model Regulation adopted by the NAIC require
amending of the Uniform Standards established by the Commission for long-term
care insurance products;

3. To receive and review in an expeditious manner Products filed with the
Commission, and rate filings for disability income and long-term care insurance
Products, and give approval of those Products and rate filings that satisfy the
applicable Uniform Standard, where such approval shall have the force and effect
of law and be binding on the Compacting States to the extent and in the manner
provided in the Compact;

4. To receive and review in an expeditious manner Advertisement relating to
long-term care insurance products for which Uniform Standards have been adopted
by the Commission, and give approval to all Advertisement that satisfies the
applicable Uniform Standard. For any product covered under this Compact, other
than long-term care insurance products, the Commission shall have the authority to
require an insurer to submit all or any part of its Advertisement with respect to that
product for review or approval prior to use, if the Commission determines that the
nature of the product is such that an Advertisement of the product could have the
capacity or tendency to mislead the public. The actions of the Commission as
provided in this section shall have the force and effect of law and shall be binding in
the Compacting States to the extent and in the manner provided in the Compact;

5. To exercise its rule-making authority and designate Products and
Advertisement that may be subject to a self-certification process without the need
for prior approval by the Commission.

6. To promulgate Operating Procedures, pursuant to Article VII of this
Compact, which shall be binding in the Compacting States to the extent and in the
manner provided in this Compact;

7. To bring and prosecute legal proceedings or actions in its name as the
Commission; provided, that the standing of any state insurance department to sue
or be sued under applicable law shall not be affected;

8. To issue subpoenas requiring the attendance and testimony of witnesses
and the production of evidence;

9. To establish and maintain offices;

10. To purchase and maintain insurance and bonds;

11. To borrow, accept or contract for services of personnel, including, but not
limited to, employees of a Compacting State;

12. To hire employees, professionals or specialists, and elect or appoint
officers, and to fix their compensation, define their duties and give them
appropriate authority to carry out the purposes of the Compact, and determine their
qualifications; and to establish the Commission's personnel policies and programs
relating to, among other things, conflicts of interest, rates of compensation and
qualifications of personnel;

13. To accept any and all appropriate donations and grants of money,
equipment, supplies, materials and services, and to receive, utilize and dispose of
the same; provided that at all times the Commission shall strive to avoid any
appearance of impropriety;

14. To lease, purchase, accept appropriate gifts or donations of, or otherwise
to own, hold, improve or use, any property, real, personal or mixed; provided that at
all times the Commission shall strive to avoid any appearance of impropriety;

15. To sell, convey, mortgage, pledge, lease, exchange, abandon or otherwise
dispose of any property, real, personal or mixed;

16. To remit filing fees to Compacting States as may be set forth in the
Bylaws, Rules or Operating Procedures;

17. To enforce compliance by Compacting States with Rules, Uniform
Standards, Operating Procedures and Bylaws;

18. To provide for dispute resolution among Compacting States;

19. To advise Compacting States on issues relating to Insurers domiciled or
doing business in Non-compacting states, consistent with the purposes of this
Compact;

20. To provide advice and training to those personnel in state insurance
departments responsible for product review, and to be a resource for state
insurance departments;

21. To establish a budget and make expenditures;

22. To borrow money;

23. To appoint committees, including advisory committees comprising
Members, state insurance regulators, state legislators or their representatives,
insurance industry and consumer representatives, and such other interested
persons as may be designated in the Bylaws;

24. To provide and receive information from, and to cooperate with law
enforcement agencies;

25. To adopt and use a corporate seal; and

26. To perform such other functions as may be necessary or appropriate to
achieve the purposes of this Compact consistent with the state regulation of the
business of insurance.

ARTICLE V.

ORGANIZATION OF THE COMMISSION

1. Membership, Voting and Bylaws

a. Each Compacting State shall have and be limited to one Member. Each
Member shall be qualified to serve in that capacity pursuant to applicable law of
the Compacting State. Any Member may be removed or suspended from office as
provided by the law of the State from which he or she shall be appointed. Any
vacancy occurring in the Commission shall be filled in accordance with the laws of
the Compacting State wherein the vacancy exists. Nothing herein shall be
construed to affect the manner in which a Compacting State determines the
election or appointment and qualification of its own Commissioner.

b. Each Member shall be entitled to one vote and shall have an opportunity
to participate in the governance of the Commission in accordance with the Bylaws.
Notwithstanding any provision herein to the contrary, no action of the Commission
with respect to the promulgation of a Uniform Standard shall be effective unless
two-thirds (2/3) of the Members vote in favor thereof.

c. The Commission shall, by a majority of the Members, prescribe Bylaws to
govern its conduct as may be necessary or appropriate to carry out the purposes,
and exercise the powers, of the Compact, including, but not limited to:

i. establishing the fiscal year of the Commission;

ii. providing reasonable procedures for appointing and electing members, as
well as holding meetings, of the Management Committee;

iii. providing reasonable standards and procedures: (i) for the establishment
and meetings of other committees, and (ii) governing any general or specific
delegation of any authority or function of the Commission;

iv. providing reasonable procedures for calling and conducting meetings of
the Commission that consists of a majority of Commission members, ensuring
reasonable advance notice of each such meeting, and providing for the right of
citizens to attend each such meeting with enumerated exceptions designed to
protect the public's interest, the privacy of individuals, and insurers' proprietary
information, including trade secrets. The Commission may meet in camera only
after a majority of the entire membership votes to close a meeting en toto or in part.
As soon as practicable, the Commission must make public (i) a copy of the vote to
close the meeting revealing the vote of each Member with no proxy votes allowed,
and (ii) votes taken during such meeting;

v. establishing the titles, duties and authority and reasonable procedures for
the election of the officers of the Commission;

vi. providing reasonable standards and procedures for the establishment of
the personnel policies and programs of the Commission. Notwithstanding any civil
service or other similar laws of any Compacting State, the Bylaws shall exclusively
govern the personnel policies and programs of the Commission;

vii. promulgating a code of ethics to address permissible and prohibited
activities of commission members and employees; and

viii. providing a mechanism for winding up the operations of the Commission
and the equitable disposition of any surplus funds that may exist after the
termination of the Compact after the payment and/or reserving of all of its debts
and obligations.

d. The Commission shall publish its bylaws in a convenient form and file a
copy thereof and a copy of any amendment thereto, with the appropriate agency or
officer in each of the Compacting States.

2. Management Committee, Officers and Personnel

a. A Management Committee comprising no more than fourteen (14)
members shall be established as follows:

(i) One (1) member from each of the six (6) Compacting States with the
largest premium volume for individual and group annuities, life, disability income
and long-term care insurance products, determined from the records of the NAIC
for the prior year;

(ii) Four (4) members from those Compacting States with at least two
percent (2%) of the market based on the premium volume described above, other
than the six (6) Compacting States with the largest premium volume, selected on a
rotating basis as provided in the Bylaws, and;

(iii) Four (4) members from those Compacting States with less than two
percent (2%) of the market, based on the premium volume described above, with
one (1) selected from each of the four (4) zone regions of the NAIC as provided in
the Bylaws.

b. The Management Committee shall have such authority and duties as may
be set forth in the Bylaws, including but not limited to:

i. managing the affairs of the Commission in a manner consistent with the
Bylaws and purposes of the Commission;

ii. establishing and overseeing an organizational structure within, and
appropriate procedures for, the Commission to provide for the creation of Uniform
Standards and other Rules, receipt and review of product filings, administrative and
technical support functions, review of decisions regarding the disapproval of a
product filing, and the review of elections made by a Compacting State to opt out of
a Uniform Standard; provided that a Uniform Standard shall not be submitted to the
Compacting States for adoption unless approved by two-thirds (2/3) of the
members of the Management Committee;

iii. overseeing the offices of the Commission; and

iv. planning, implementing, and coordinating communications and activities
with other state, federal and local government organizations in order to advance
the goals of the Commission.

c. The Commission shall elect annually officers from the Management
Committee, with each having such authority and duties, as may be specified in the
Bylaws.

d. The Management Committee may, subject to the approval of the
Commission, appoint or retain an executive director for such period, upon such
terms and conditions and for such compensation as the Commission may deem
appropriate. The executive director shall serve as secretary to the Commission, but
shall not be a Member of the Commission. The executive director shall hire and
supervise such other staff as may be authorized by the Commission.

3. Legislative and Advisory Committees

a. A legislative committee comprising state legislators or their designees
shall be established to monitor the operations of, and make recommendations to,
the Commission, including the Management Committee; provided that the manner
of selection and term of any legislative committee member shall be as set forth in
the Bylaws. Prior to the adoption by the Commission of any Uniform Standard,
revision to the Bylaws, annual budget or other significant matter as may be
provided in the Bylaws, the Management Committee shall consult with and report
to the legislative committee.

b. The Commission shall establish two (2) advisory committees, one of which
shall comprise consumer representatives independent of the insurance industry,
and the other comprising insurance industry representatives.

c. The Commission may establish additional advisory committees as its
Bylaws may provide for the carrying out of its functions.

4. Corporate Records of the Commission

The Commission shall maintain its corporate books and records in
accordance with the Bylaws.

5. Qualified Immunity, Defense and Indemnification

a. The Members, officers, executive director, employees and representatives
of the Commission shall be immune from suit and liability, either personally or in
their official capacity, for any claim for damage to or loss of property or personal
injury or other civil liability caused by or arising out of any actual or alleged act,
error or omission that occurred, or that the person against whom the claim is made
had a reasonable basis for believing occurred within the scope of Commission
employment, duties or responsibilities; provided, that nothing in this paragraph
shall be construed to protect any such person from suit and/or liability for any
damage, loss, injury or liability caused by the intentional or willful and wanton
misconduct of that person.

b. The Commission shall defend any Member, officer, executive director,
employee or representative of the Commission in any civil action seeking to impose
liability arising out of any actual or alleged act, error or omission that occurred
within the scope of Commission employment, duties or responsibilities, or that the
person against whom the claim is made had a reasonable basis for believing
occurred within the scope of Commission employment, duties or responsibilities;
provided, that nothing herein shall be construed to prohibit that person from
retaining his or her own counsel; and provided further, that the actual or alleged
act, error or omission did not result from that person's intentional or willful and
wanton misconduct.

c. The Commission shall indemnify and hold harmless any Member, officer,
executive director, employee or representative of the Commission for the amount of
any settlement or judgment obtained against that person arising out of any actual
or alleged act, error or omission that occurred within the scope of Commission
employment, duties or responsibilities, or that such person had a reasonable basis
for believing occurred within the scope of Commission employment, duties or
responsibilities, provided, that the actual or alleged act, error or omission did not
result from the intentional or willful and wanton misconduct of that person.

ARTICLE VI.

MEETINGS AND ACTS OF THE COMMISSION

1. The Commission shall meet and take such actions as are consistent with
the provisions of this Compact and the Bylaws.

2. Each Member of the Commission shall have the right and power to cast a
vote to which that Compacting State is entitled and to participate in the business
and affairs of the Commission. A Member shall vote in person or by such other
means as provided in the Bylaws. The Bylaws may provide for Members'
participation in meetings by telephone or other means of communication.

3. The Commission shall meet at least once during each calendar year.
Additional meetings shall be held as set forth in the Bylaws.

ARTICLE VII.

RULES & OPERATING PROCEDURES:

RULEMAKING FUNCTIONS OF THE COMMISSION

AND OPTING OUT OF UNIFORM STANDARDS

1. Rulemaking Authority. The Commission shall promulgate reasonable
Rules, including Uniform Standards, and Operating Procedures in order to
effectively and efficiently achieve the purposes of this Compact. Notwithstanding
the foregoing, in the event the Commission exercises its rulemaking authority in a
manner that is beyond the scope of the purposes of this Act, or the powers granted
hereunder, then such an action by the Commission shall be invalid and have no
force and effect.

2. Rulemaking Procedure. Rules and Operating Procedures shall be made
pursuant to a rulemaking process that conforms to the Model State Administrative
Procedure Act of 1981 as amended, as may be appropriate to the operations of the
Commission. Before the Commission adopts a Uniform Standard, the Commission
shall give written notice to the relevant state legislative committee(s) in each
Compacting State responsible for insurance issues of its intention to adopt the
Uniform Standard. The Commission in adopting a Uniform Standard shall consider
fully all submitted materials and issue a concise explanation of its decision.

3. Effective Date and Opt Out of a Uniform Standard. A Uniform Standard
shall become effective ninety (90) days after its promulgation by the Commission or
such later date as the Commission may determine; provided, however, that a
Compacting State may opt out of a Uniform Standard as provided in this Article.
Opt out shall be defined as any action by a Compacting State to decline to adopt
or participate in a promulgated Uniform Standard. All other Rules and Operating
Procedures, and amendments thereto, shall become effective as of the date
specified in each Rule, Operating Procedure or amendment.

4. Opt Out Procedure. A Compacting State may opt out of a Uniform
Standard, either by legislation or regulation duly promulgated by the Insurance
Department under the Compacting State's Administrative Procedure Act. If a
Compacting State elects to opt out of a Uniform Standard by regulation, it must (a)
give written notice to the Commission no later than ten (10) business days after the
Uniform Standard is promulgated, or at the time the State becomes a Compacting
State and (b) find that the Uniform Standard does not provide reasonable
protections to the citizens of the State, given the conditions in the State. The
Commissioner shall make specific findings of fact and conclusions of law, based on
a preponderance of the evidence, detailing the conditions in the State which
warrant a departure from the Uniform Standard and determining that the Uniform
Standard would not reasonably protect the citizens of the State. The Commissioner
must consider and balance the following factors and find that the conditions in the
State and needs of the citizens of the State outweigh: (i) the intent of the
legislature to participate in, and the benefits of, an interstate agreement to
establish national uniform consumer protections for the Products subject to this
Act; and (ii) the presumption that a Uniform Standard adopted by the Commission
provides reasonable protections to consumers of the relevant Product.

Notwithstanding the foregoing, a Compacting State may, at the time of its
enactment of this Compact, prospectively opt out of all Uniform Standards
involving long-term care insurance products by expressly providing for such opt out
in the enacted Compact, and such an opt out shall not be treated as a material
variance in the offer or acceptance of any State to participate in this Compact. Such
an opt out shall be effective at the time of enactment of this Compact by the
Compacting State and shall apply to all existing Uniform Standards involving long-term care insurance products and those subsequently promulgated.

5. Effect of Opt Out. If a Compacting State elects to opt out of a Uniform
Standard, the Uniform Standard shall remain applicable in the Compacting State
electing to opt out until such time the opt-out legislation is enacted into law or the
regulation opting out becomes effective.

Once the opt out of a Uniform Standard by a Compacting State becomes
effective as provided under the laws of that State, the Uniform Standard shall have
no further force and effect in that State unless and until the legislation or
regulation implementing the opt-out is repealed or otherwise becomes ineffective
under the laws of the State. If a Compacting State opts out of a Uniform Standard
after the Uniform Standard has been made effective in that State, the opt-out shall
have the same prospective effect as provided under Article XIV for withdrawals.

6. Stay of Uniform Standard. If a Compacting State has formally initiated the
process of opting out of a Uniform Standard by regulation, and while the regulatory
opt-out is pending, the Compacting State may petition the Commission, at least
fifteen (15) days before the effective date of the Uniform Standard, to stay the
effectiveness of the Uniform Standard in that State. The Commission may grant a
stay if it determines the regulatory opt-out is being pursued in a reasonable manner
and there is a likelihood of success. If a stay is granted or extended by the
Commission, the stay or extension thereof may postpone the effective date by up to
ninety (90) days, unless affirmatively extended by the Commission; provided, a stay
may not be permitted to remain in effect for more than one (1) year unless the
Compacting State can show extraordinary circumstances which warrant a
continuance of the stay, including, but not limited to, the existence of a legal
challenge which prevents the Compacting State from opting out. A stay may be
terminated by the Commission upon notice that the rulemaking process has been
terminated.

7. Not later than thirty (30) days after a Rule or Operating Procedure is
promulgated, any person may file a petition for judicial review of the Rule or
Operating Procedure; provided, that the filing of such a petition shall not stay or
otherwise prevent the Rule or Operating Procedure from becoming effective unless
the court finds that the petitioner has a substantial likelihood of success. The court
shall give deference to the actions of the Commission consistent with applicable
law and shall not find the Rule or Operating Procedure to be unlawful if the Rule or
Operating Procedure represents a reasonable exercise of the Commission's
authority.

ARTICLE VIII.

COMMISSION RECORDS AND ENFORCEMENT

1. The Commission shall promulgate Rules establishing conditions and
procedures for public inspection and copying of its information and official records,
except such information and records involving the privacy of individuals and
insurers' trade secrets. The Commission may promulgate additional Rules under
which it may make available to federal and state agencies, including law
enforcement agencies, records and information otherwise exempt from disclosure,
and may enter into agreements with such agencies to receive or exchange
information or records subject to nondisclosure and confidentiality provisions.

2. Except as to privileged records, data and information, the laws of any
Compacting State pertaining to confidentiality or nondisclosure shall not relieve
any Compacting State Commissioner of the duty to disclose any relevant records,
data or information to the Commission; provided, that disclosure to the Commission
shall not be deemed to waive or otherwise affect any confidentiality requirement;
and further provided, that, except as otherwise expressly provided in this Act, the
Commission shall not be subject to the Compacting State's laws pertaining to
confidentiality and nondisclosure with respect to records, data and information in
its possession. Confidential information of the Commission shall remain confidential
after such information is proved to any Commissioner.

3. The Commission shall monitor Compacting States for compliance with
duly adopted Bylaws, Rules, including Uniform Standards, and Operating
Procedures. The Commission shall notify any non-complying Compacting State in
writing of its noncompliance with Commission Bylaws, Rules or Operating
Procedures. If a non-complying Compacting State fails to remedy its
noncompliance within the time specified in the notice of noncompliance, the
Compacting State shall be deemed to be in default as set forth in Article XIV.

4. The Commissioner of any State in which an Insurer is authorized to do
business, or is conducting the business of insurance, shall continue to exercise his
or her authority to oversee the market regulation of the activities of the Insurer in
accordance with the provisions of the State's law. The Commissioner's enforcement
of compliance with the Compact is governed by the following provisions:

a. With respect to the Commissioner's market regulation of a Product or
Advertisement that is approved or certified to the Commission, the content of the
Product or Advertisement shall not constitute a violation of the provisions,
standards or requirements of the Compact except upon a final order of the
Commission, issued at the request of a Commissioner after prior notice to the
Insurer and an opportunity for hearing before the Commission.

b. Before a Commissioner may bring an action for violation of any provision,
standard or requirement of the Compact relating to the content of an
Advertisement not approved or certified to the Commission, the Commission, or an
authorized Commission officer or employee, must authorize the action. However,
authorization pursuant to this Paragraph does not require notice to the Insurer,
opportunity for hearing or disclosure of requests for authorization or records of the
Commission's action on such requests.

ARTICLE IX.

DISPUTE RESOLUTION

The Commission shall attempt, upon the request of a Member, to resolve any
disputes or other issues that are subject to this Compact and which may arise
between two or more Compacting States, or between Compacting States and Non-compacting States, and the Commission shall promulgate an Operating Procedure
providing for resolution of such disputes.

ARTICLE X.

PRODUCT FILING AND APPROVAL

1. Insurers and Third-Party Filers seeking to have a Product approved by the
Commission shall file the Product with, and pay applicable filing fees to, the
Commission. Nothing in this Act shall be construed to restrict or otherwise prevent
an Insurer from filing its Product with the insurance department in any State
wherein the Insurer is licensed to conduct the business of insurance, and such filing
shall be subject to the laws of the States where filed.

2. The Commission shall establish appropriate filing and review processes
and procedures pursuant to Commission Rules and Operating Procedures.
Notwithstanding any provision herein to the contrary, the Commission shall
promulgate Rules to establish conditions and procedures under which the
Commission will provide public access to Product filing information. In establishing
such Rules, the Commission shall consider the interests of the public in having
access to such information, as well as protection of personal medical and financial
information and trade secrets, that may be contained in a Product filing or
supporting information.

3. Any Product approved by the Commission may be sold or otherwise issued
in those Compacting States for which the Insurer is legally authorized to do
business.

ARTICLE XI.

REVIEW OF COMMISSION

DECISIONS REGARDING FILINGS

1. Not later than thirty (30) days after the Commission has given notice of a
disapproved Product or Advertisement filed with the Commission, the Insurer or
Third-Party Filer whose filing was disapproved may appeal the determination to a
review panel appointed by the Commission. The Commission shall promulgate Rules
to establish procedures for appointing such review panels and provide for notice
and hearing. An allegation that the Commission, in disapproving a Product or
Advertisement filed with the Commission, acted arbitrarily, capriciously, or in a
manner that is an abuse of discretion or otherwise not in accordance with the law, is
subject to judicial review in accordance with Article III, Section 4.

2. The Commission shall have authority to monitor, review and reconsider
Products and Advertisement subsequent to their filing or approval upon a finding
that the Product does not meet the relevant Uniform Standard. Where appropriate,
the Commission may withdraw or modify its approval after proper notice and
hearing, subject to the appeal process in Section 1 above.

ARTICLE XII.

FINANCE

1. The Commission shall pay or provide for the payment of the reasonable
expenses of its establishment and organization. To fund the cost of its initial
operations, the Commission may accept contributions and other forms of funding
from the National Association of Insurance Commissioners, Compacting States and
other sources. Contributions and other forms of funding from other sources shall be
of such a nature that the independence of the Commission concerning the
performance of its duties shall not be compromised.

2. The Commission shall collect a filing fee from each Insurer and Third-Party Filer filing a product with the Commission to cover the cost of the operations
and activities of the Commission and its staff in a total amount sufficient to cover
the Commission's annual budget.

3. The Commission's budget for a fiscal year shall not be approved until it
has been subject to notice and comment as set forth in Article VII of this Compact.

4. The Commission shall be exempt from all taxation in and by the
Compacting States.

5. The Commission shall not pledge the credit of any Compacting State,
except by and with the appropriate legal authority of that Compacting State.

6. The Commission shall keep complete and accurate accounts of all its
internal receipts, including grants and donations, and disbursements of all funds
under its control. The internal financial accounts of the Commission shall be subject
to the accounting procedures established under its Bylaws. The financial accounts
and reports including the system of internal controls and procedures of the
Commission shall be audited annually by an independent certified public
accountant. Upon the determination of the Commission, but no less frequently than
every three (3) years, the review of the independent auditor shall include a
management and performance audit of the Commission. The Commission shall
make an Annual Report to the Governor and legislature of the Compacting States,
which shall include a report of the independent audit. The Commission's internal
accounts shall not be confidential and such materials may be shared with the
Commissioner of any Compacting State upon request, provided, however, that any
work papers related to any internal or independent audit and any information
regarding the privacy of individuals' and insurers' proprietary information, including
trade secrets, shall remain confidential.

7. No Compacting State shall have any claim to or ownership of any property
held by or vested in the Commission or to any Commission funds held pursuant to
the provisions of this Compact.

ARTICLE XIII.

COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT

1. Any State is eligible to become a Compacting State.

2. The Compact shall become effective and binding upon legislative
enactment of the Compact into law by two Compacting States; provided, the
Commission shall become effective for purposes of adopting Uniform Standards
for, reviewing, and giving approval or disapproval of, Products filed with the
Commission that satisfy applicable Uniform Standards only after twenty-six (26)
States are Compacting States or, alternatively, by States representing greater than
forty percent (40%) of the premium volume for life insurance, annuity, disability
income and long-term care insurance products, based on records of the NAIC for
the prior year. Thereafter, it shall become effective and binding as to any other
Compacting State upon enactment of the Compact into law by that State.

3. Amendments to the Compact may be proposed by the Commission for
enactment by the Compacting States. No amendment shall become effective and
binding upon the Commission and the Compacting States unless and until all
Compacting States enact the amendment into law.

ARTICLE XIV.

WITHDRAWAL, DEFAULT AND TERMINATION

1. Withdrawal

a. Once effective, the Compact shall continue in force and remain binding
upon each and every Compacting State; provided, that a Compacting State may
withdraw from the Compact (Withdrawing State) by enacting a statute
specifically repealing the statute which enacted the Compact into law.

b. The effective date of withdrawal is the effective date of the repealing
statute. However, the withdrawal shall not apply to any product filings approved or
self-certified, or any Advertisement of such products, on the date the repealing
statute becomes effective, except by mutual agreement of the Commission and the
Withdrawing State unless the approval is rescinded by the Withdrawing State as
provided in Subsection e. of this Section.

c. The Commissioner of the Withdrawing State shall immediately notify the
Management Committee in writing upon the introduction of legislation repealing
this Compact in the Withdrawing State.

d. The Commission shall notify the other Compacting States of the
introduction of such legislation within ten (10) days after its receipt of notice
thereof.

e. The Withdrawing State is responsible for all obligations, duties and
liabilities incurred through the effective date of withdrawal, including any
obligations, the performance of which extend beyond the effective date of
withdrawal, except to the extent those obligations may have been released or
relinquished by mutual agreement of the Commission and the Withdrawing State.
The Commission's approval of Products and Advertisement prior to the effective
date of withdrawal shall continue to be effective and be given full force and effect
in the Withdrawing State, unless formally rescinded by the Withdrawing State in
the same manner as provided by the laws of the Withdrawing State for the
prospective disapproval of Products or Advertisement previously approved under
state law.

f. Reinstatement following withdrawal of any Compacting State shall occur
upon the effective date of the Withdrawing State reenacting the Compact.

2. Default

a. If the Commission determines that any Compacting State has at any time
defaulted (Defaulting State) in the performance of any of its obligations or
responsibilities under this Compact, the Bylaws or duly promulgated Rules or
Operating Procedures, then, after notice and hearing as set forth in the Bylaws, all
rights, privileges and benefits conferred by this Compact on the Defaulting State
shall be suspended from the effective date of default as fixed by the Commission.
The grounds for default include, but are not limited to, failure of a Compacting
State to perform its obligations or responsibilities, and any other grounds
designated in Commission Rules. The Commission shall immediately notify the
Defaulting State in writing of the Defaulting State's suspension pending a cure of
the default. The Commission shall stipulate the conditions and the time period
within which the Defaulting State must cure its default. If the Defaulting State fails
to cure the default within the time period specified by the Commission, the
Defaulting State shall be terminated from the Compact and all rights, privileges
and benefits conferred by this Compact shall be terminated from the effective date
of termination.

b. Product approvals by the Commission or product self-certifications, or any
Advertisement in connection with such Product, that are in force on the effective
date of termination shall remain in force in the Defaulting State in the same manner
as if the Defaulting State had withdrawn voluntarily pursuant to Paragraph 1 of this
Article.

c. Reinstatement following termination of any Compacting State requires a
reenactment of the Compact.

3. Dissolution of Compact

a. The Compact dissolves effective upon the date of the withdrawal or
default of the Compacting State which reduces membership in the Compact to one
Compacting State.

b. Upon the dissolution of this Compact, the Compact becomes null and void
and shall be of no further force or effect, and the business and affairs of the
Commission shall be wound up and any surplus funds shall be distributed in
accordance with the Bylaws.

ARTICLE XV.

SEVERABILITY AND CONSTRUCTION

1. The provisions of this Compact shall be severable; and if any phrase,
clause, sentence or provision is deemed unenforceable, the remaining provisions of
the Compact shall be enforceable.

2. The provisions of this Compact shall be liberally construed to effectuate
its purposes.

ARTICLE XVI.

BINDING EFFECT OF COMPACT AND OTHER LAWS

1. Other Laws

a. Nothing herein prevents the enforcement of any other law of a
Compacting State, except as provided in Paragraph b. of this Article.

b. For any Product approved or certified to the Commission, the Rules,
Uniform Standards and any other requirements of the Commission shall constitute
the exclusive provisions applicable to the content, approval and certification of
such Products. For advertisement that is subject to the Commission's authority, any
Rule, Uniform Standard or other requirement of the Commission which governs the
content of the Advertisement shall constitute the exclusive provision that a
Commissioner may apply to the content of the Advertisement. Notwithstanding the
foregoing, no action taken by the Commission shall abrogate or restrict: i. the
access of any person to state courts; ii. remedies available under state law related
to breach of contract, tort, or other laws not specifically directed to the content of
the Product; iii. state law relating to the construction of insurance contracts; or iv.
the authority of the attorney general of the state, including but not limited to
maintaining any actions or proceedings, as authorized by law.

c. All insurance products filed with individual States shall be subject to the
laws of those States.

2. Binding Effect of this Compact

a. All lawful actions of the Commission, including all Rules and Operating
Procedures promulgated by the Commission, are binding upon the Compacting
States.

b. All agreements between the Commission and the Compacting States are
binding in accordance with their terms.

c. Upon the request of a party to a conflict over the meaning or
interpretation of Commission actions, and upon a majority vote of the Compacting
States, the Commission may issue advisory opinions regarding the meaning or
interpretation in dispute.

d. In the event any provision of this Compact exceeds the constitutional
limits imposed on the legislature of any Compacting State, the obligations, duties,
powers or jurisdiction sought to be conferred by that provision upon the
Commission shall be ineffective as to that Compacting State, and those obligations,
duties, powers or jurisdiction shall remain in the Compacting State and shall be
exercised by the agency thereof to which those obligations, duties, powers or
jurisdiction are delegated by law in effect at the time this Compact becomes
effective.

Legislative History

Source: L. 2004: Entire part added, p. 91, � 1, effective August 4. L. 2005: Article XI section 1 amended, p. 770, � 44, effective June 1.