§ 26-15-201 — Interstate insurance product regulation compact

The Interstate Insurance Product Regulation Compact is hereby
enacted into law and entered into on behalf of this state with
any and all other states legally joining therein in a form
substantially as follows:
INTERSTATE INSURANCE PRODUCT REGULATION COMPACT
ARTICLE I
Purposes
(a) The purposes of this compact are, through means of
joint and cooperative action among the compacting states:
(i) To promote and protect the interest of consumers
of individual and group annuity, life insurance, disability
income and long-term care insurance products;
(ii) To develop uniform standards for insurance
products covered under the compact;
(iii) 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;
(iv) To give appropriate regulatory approval to those
product filings and advertisements satisfying the applicable
uniform standard;
(v) 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;
(vi) To create the interstate insurance product
regulation commission; and
(vii) To perform these and such other related
functions as may be consistent with the state regulation of the
business of insurance.
ARTICLE II
Definitions
(a) Notwithstanding W.S. 26-1-102, for purposes of this
compact:
(i) "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;
(ii) "Bylaws" means those bylaws established by the
commission for its governance, or for directing or controlling
the commission's actions or conduct;
(iii) "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enacted this compact legislation and which has not withdrawn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;
(iv) "Commission" means the "interstate insurance
product regulation commission" established by this compact;
(v) "Commissioner" means the chief insurance
regulatory official of a state including, but not limited to
commissioner, superintendent, director or administrator;
(vi) "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;
(vii) "Insurer" means any entity licensed by a state
to issue contracts of insurance for any of the lines of
insurance covered by this compact;
(viii) "Member" means the person chosen by a
compacting state as its representative to the commission, or his
or her designee;
(ix) "Noncompacting state" means any state which is
not at the time a compacting state;
(x) "Operating procedures" mean procedures
promulgated by the commission implementing a rule, uniform
standard or a provision of this compact;
(xi) "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;
(xii) "Rule" means a statement of general or
particular applicability and future effect promulgated by the
commission, including a uniform standard developed pursuant to
article VII of this compact, designed to implement, interpret or
prescribe law or policy or describing the organization,
procedure or practice requirements of the commission, which
shall have the force and effect of law in the compacting states;
(xiii) "State" means any state, district or territory
of the United States of America;
(xiv) "Third-party filer" means an entity that
submits a product filing to the commission on behalf of an
insurer;
(xv) "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
(a) 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.
(b) The commission is a body corporate and politic, and an
instrumentality of the compacting states.
(c) The commission is solely responsible for its
liabilities except as otherwise specifically provided in this
compact.
(d) 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
(a) The commission shall have the following powers:
(i) 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;
(ii) To exercise its rulemaking authority and
establish reasonable uniform standards for products covered
under the compact, and advertisement related thereto, which
shall have the force and effect of law and shall be binding in
the compacting states, but only for those products filed with
the commission, provided, that a compacting state shall have the
right to opt out of such uniform standard pursuant to article
VII, to the extent and in the manner provided in this compact,
and, provided further, that any uniform standard established by
the commission for long-term care insurance products may provide
the same or greater protections for consumers as, but shall not
provide less than, those protections set forth in the National
Association of Insurance Commissioners' Long-Term Care Insurance
Model Act and Long-Term Care Insurance Model Regulation,
respectively, adopted as of 2001. The commission shall consider
whether any subsequent amendments to the National Association Of
Insurance Commissioners' Long-Term Care Insurance Model Act or
Long-Term Care Insurance Model Regulation adopted by the
national association of insurance commissioners require amending
of the uniform standards established by the commission for long-
term care insurance products;
(iii) 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;
(iv) 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 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;
(v) To exercise its rulemaking authority and
designate products and advertisement that may be subject to a
self-certification process without the need for prior approval
by the commission;
(vi) 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;
(vii) 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;
(viii) To issue subpoenas requiring the attendance
and testimony of witnesses and the production of evidence;
(ix) To establish and maintain offices;
(x) To purchase and maintain insurance and bonds;
(xi) To borrow, accept or contract for services of
personnel, including, but not limited to, employees of a
compacting state;
(xii) 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;
(xiii) 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;
(xiv) 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;
(xv) To sell, convey, mortgage, pledge, lease,
exchange, abandon or otherwise dispose of any property, real,
personal or mixed;
(xvi) To remit filing fees to compacting states as
may be set forth in the bylaws, rules or operating procedures;
(xvii) To enforce compliance by compacting states
with rules, uniform standards, operating procedures and bylaws;
(xviii) To provide for dispute resolution among
compacting states;
(xix) To advise compacting states on issues relating
to insurers domiciled or doing business in noncompacting
jurisdictions, consistent with the purposes of this compact;
(xx) 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;
(xxi) To establish a budget and make expenditures;
(xxii) To borrow money;
(xxiii) 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;
(xxiv) To provide and receive information from, and
to cooperate with law enforcement agencies;
(xxv) To adopt and use a corporate seal; and
(xxvi) 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
(a) Membership, voting and bylaws shall be as follows:
(i) Each compacting state shall have and be limited
to one (1) 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;
(ii) Each member shall be entitled to one (1) 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;
(iii) 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:
(A) Establishing the fiscal year of the
commission;
(B) Providing reasonable procedures for
appointing and electing members, as well as holding meetings, of
the management committee;
(C) 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.
(D) Providing reasonable procedures for calling
and conducting meetings of the commission that consist 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.
(E) Establishing the titles, duties and
authority and reasonable procedures for the election of the
officers of the commission;
(F) 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;
(G) Promulgating a code of ethics to address
permissible and prohibited activities of commission members and
employees; and
(H) 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; and
(iv) 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.
(b) Management committee, officers and personnel shall be
as follows:
(i) A management committee comprising no more than
fourteen (14) members shall be established as follows:
(A) 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 national
association of insurance commissioners for the prior year;
(B) 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
(C) 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 national association of
insurance commissioners as provided in the bylaws.
(ii) The management committee shall have such
authority and duties as may be set forth in the bylaws,
including but not limited to:
(A) Managing the affairs of the commission in a
manner consistent with the bylaws and purposes of the
commission;
(B) 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;
(C) Overseeing the offices of the commission;
and
(D) Planning, implementing and coordinating
communications and activities with other state, federal and
local government organizations in order to advance the goals of
the commission.
(iii) The commission shall elect annually officers
from the management committee, with each having such authority
and duties, as may be specified in the bylaws;
(iv) 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.
(c) Legislative and advisory committees shall be as
follows:
(i) 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;
(ii) The commission shall establish two (2) advisory
committees, one (1) of which shall comprise consumer
representatives independent of the insurance industry, and the
other comprising insurance industry representatives;
(iii) The commission may establish additional
advisory committees as its bylaws may provide for the carrying
out of its functions.
(d) Corporate records of the commission shall be as
follows:
(i) The commission shall maintain its corporate books
and records in accordance with the bylaws.
(e) Qualified immunity, defense and indemnification shall
be as follows:
(i) 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 liability for any damage, loss, injury
or liability caused by the intentional or willful and wanton
misconduct of that person;
(ii) 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;
(iii) 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
(a) The commission shall meet and take such actions as are
consistent with the provisions of this compact and the bylaws.
(b) 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.
(c) 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 and operating procedures:
rulemaking functions of the commission
and opting out of uniform standards
(a) 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 compact,
or the powers granted hereunder, then such an action by the
commission shall be invalid and have no force and effect.
(b) 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 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.
(c) 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.
(d) 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:
(i) 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
(ii) 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:
(A) The intent of the legislature to participate
in, and the benefits of, an interstate agreement to establish
national uniform consumer protections for the products subject
to this compact; and
(B) The presumption that a uniform standard
adopted by the commission provides reasonable protections to
consumers of the relevant product.
(iii) 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.
(e) Effect of opt out is as follows:
(i) 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;
(ii) 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.
(f) 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.
(g) 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
(a) 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.
(b) Except as to privileged records, data and information,
the laws of any compacting state pertaining to confidentiality
or nondisclosure shall not relieve any compacting state
commissioner of the duty to disclose any relevant records, data
or information to the commission; provided, that disclosure to
the commission shall not be deemed to waive or otherwise affect
any confidentiality requirement; and further provided, that,
except as otherwise expressly provided in this compact, the
commission shall not be subject to the compacting state's laws
pertaining to confidentiality and nondisclosure with respect to
records, data and information in its possession. Confidential
information of the commission shall remain confidential after
such information is provided to any commissioner.
(c) The commission shall monitor compacting states for
compliance with duly adopted bylaws, rules, including uniform
standards, and operating procedures. The commission shall
notify any noncomplying compacting state in writing of its
noncompliance with commission bylaws, rules or operating
procedures. If a noncomplying 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.
(d) 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 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:
(i) 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;
(ii) 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 (2) or more compacting
states, or between compacting states and noncompacting states,
and the commission shall promulgate an operating procedure
providing for resolution of such disputes.
ARTICLE X
Product filing and approval
(a) Insurers and third-party filers seeking to have a
product approved by the commission shall file the product with,
and pay applicable filing fees to, the commission. Nothing in
this compact shall be construed to restrict or otherwise prevent
an insurer from filing its product with the insurance department
in any state wherein the insurer is licensed to conduct the
business of insurance, and such filing shall be subject to the
laws of the states where filed.
(b) 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.
(c) 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
(a) 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, subsection (d).
(b) The commission shall have authority to monitor, review
and reconsider products and advertisements 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 subsection
(a) of this article.
Article XII
Finance
(a) 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.
(b) 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.
(c) 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.
(d) The commission shall be exempt from all taxation in
and by the compacting states.
(e) The commission shall not pledge the credit of any
compacting state, except by and with the appropriate legal
authority of that compacting state.
(f) 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.
(g) 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
(a) Any state is eligible to become a compacting state.
(b) The compact shall become effective and binding upon
legislative enactment of the compact into law by two (2)
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 national association of insurance
commissioners for the prior year. Thereafter, it shall become
effective and binding as to any other compacting state upon
enactment of the compact into law by that state.
(c) 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
(a) Withdrawal shall be as follows:
(i) 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;
(ii) The effective date of withdrawal is the
effective date of the repealing statute. However, the
withdrawal shall not apply to any product filings approved or
self-certified, or any advertisement of such products, on the
date the repealing statute becomes effective, except by mutual
agreement of the commission and the withdrawing state unless the
approval is rescinded by the withdrawing state as provided in
paragraph (v) of this subsection;
(iii) 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;
(iv) The commission shall notify the other compacting
states of the introduction of such legislation within ten (10)
days after its receipt of notice thereof;
(v) 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;
(vi) Reinstatement following withdrawal of any
compacting state shall occur upon the effective date of the
withdrawing state reenacting the compact.
(b) Default shall be as follows:
(i) 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;
(ii) 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 subsection (a) of this article;
(iii) Reinstatement following termination of any
compacting state requires a reenactment of the compact.
(c) Dissolution of the compact shall be as follows:
(i) The compact dissolves effective upon the date of
the withdrawal or default of the compacting state which reduces
membership in the compact to one (1) compacting state;
(ii) 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
(a) 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.
(b) The provisions of this compact shall be liberally
construed to effectuate its purposes.
ARTICLE XVI
Binding effect of compact and other laws
(a) Other laws:
(i) Nothing herein prevents the enforcement of any
other law of a compacting state, except as provided in paragraph
(ii) of this subsection;
(ii) 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:
(A) The access of any person to state courts;
(B) Remedies available under state law related
to breach of contract, tort, or other laws not specifically
directed to the content of the product;
(C) State law relating to the construction of
insurance contracts; or
(D) The authority of the attorney general of the
state, including but not limited to maintaining any actions or
proceedings, as authorized by law.
(iii) All insurance products filed with individual
states shall be subject to the laws of those states.
(b) Binding effect of this compact:
(i) All lawful actions of the commission, including
all rules and operating procedures promulgated by the
commission, are binding upon the compacting states;
(ii) All agreements between the commission and the
compacting states are binding in accordance with their terms;
(iii) 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;
(iv) 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.