191—58.3(505,510) Registration required. A third-party administrator shall not operate as a third-party administrator in Iowa without an approved certificate of registration from the division. A third-party administrator that has a home state other than Iowa must apply for and obtain a nonresident third-party administrator certificate of registration from the division before operating as a third-party administrator in Iowa.
	58.3(1) Exceptions.
	a. 	The following persons doing the following corresponding actions shall not be required to have approved certificates of registration from the division if these are the only actions by the persons that would otherwise cause the persons to be considered third-party administrators:
	(1)	An employer administering its employee benefit plan or the plan of an affiliated employer under common management and control;
	(2)	A trust exempt from taxation under Section 507(a) of the Internal Revenue Code and its trustees and employees acting pursuant to such trust, or a custodian and the custodian’s agents or employees acting pursuant to a custodian account that meets the requirements of Section 401(f) of the Internal Revenue Code; or
	(3)	A person licensed as a managing general agent in this state when acting within the scope of activities conveyed under such a license.
	b. 	An insurer that underwrites, collects charges, collateral or premiums from, or adjusts or settles claims for other than its policyholders, subscribers and certificate holders is not required to be licensed as a third-party administrator and shall be exempt from rule 191—58.3(505,510), except that the insurer shall comply with paragraphs 58.3(1)“c,” “e” and “f” and rules 191—58.6(505,510) and 191—58.7(505,510), if applicable.
	c. 	A person shall not be required to have an approved certificate of registration from the division if that person is affiliated with a licensed insurer and that person only acts as a third-party administrator for the direct and assumed insurance business of the affiliated insurer, provided that the insurer shall provide all of the third-party administrator’s books and records to the insurance commissioner upon request.
	d. 	A person shall not be required to have an approved certificate of registration from the division if that person only acts as a third-party administrator for a group plan based in another state that has fewer than 100 insureds under the plan residing in Iowa.
	e. 	A person who is not required to be registered as a third-party administrator under Iowa Code chapter 510 or this chapter and who directly or indirectly underwrites, collects charges or premiums from, or adjusts or settles claims on residents of this state, only in connection with life, annuity or health coverage provided by a self-funded plan other than a governmental or church plan, shall file a statement with the commissioner triennially, verifying the person’s status as described herein. An example of such a statement may be found on the division’s website.
	f. 	An administrator operating solely as a single-employer trust or Taft-Hartley labor union trust as defined under ERISA shall be required to file a statement triennially, verifying the administrator’s status as described herein. An example of such a statement may be found on the division’s website.
	58.3(2) Application.
	a. 	All third-party administrators wishing to do business in Iowa shall electronically file a completed application and any required attachments in the form prescribed by the division. The division may require the applicant to identify the following persons affiliated with the third-party administrator: owners with 10 percent interest or voting interest, and any partners, officers, directors, members or managers of the business entity. The application shall be accompanied by a filing fee as stated in rule 191—58.18(510).
	b. 	All third-party administrator applicants shall submit a completed biographical affidavit, in a form prescribed by the commissioner, for all individuals identified in paragraph 58.3(2)“a.”
	c. 	Application for resident third-party administrator certificate of registration.
	(1)	All applications shall include evidence of the existence of a surety bond issued by an insurance company licensed to do business in the state of Iowa. The bond must be in an amount equivalent to 10 percent of the third-party administrator’s average daily client account balance during the preceding calendar year. In no case shall the bond be less than $50,000 or more than $1,000,000. The surety bond shall be in the form prescribed by the commissioner. The bond shall be payable to the Iowa Insurance Division to ensure the financial protection of the third-party administrator’s customers, subject to the dollar limitation of the surety bond.
	(2)	An application by a third-party administrator that is a corporation, association or benefit society shall be accompanied by a certified copy of the articles of incorporation or association or a certification of good standing from the Iowa secretary of state.
	d. 	Application for nonresident third-party administrator certificate of registration.
	(1)	A third-party administrator whose home state is not Iowa shall file with the division, in a manner acceptable to the division, a completed application and a certification from the home state that verifies that the applicant is in good standing in the home state.
	(2)	In lieu of requiring a third-party administrator to file a certification, the division may verify the nonresident third-party administrator’s home state status through an electronic database maintained by the National Association of Insurance Commissioners, its affiliates or subsidiaries.
	(3)	A third-party administrator shall not be eligible for a nonresident third-party administrator certificate of registration under paragraph 58.3(2)“c” if the third-party administrator does not hold a certificate of registration as a resident in a home state that has adopted a law governing third-party administrators substantially similar to Iowa Code chapter 510 and this chapter. A third-party administrator may designate a state other than the resident state as its home state. If a third-party administrator is not eligible under paragraph 58.3(2)“c,” it must meet the application requirements for a resident third-party administrator.
	e. 	The division may refuse to issue a certificate of registration to an applicant as provided in Iowa Code section 510.21, or may refuse to issue a certificate of registration if the division determines that any of the grounds set forth in rule 191—58.16(510) exist with respect to the third-party administrator.
	f. 	If an application is approved, the division will electronically deliver to the third-party administrator a certificate of registration.
	58.3(3) Validity. A certificate of registration issued under Iowa Code chapter 510 and this rule shall remain valid, unless surrendered by the third-party administrator, or suspended, revoked, or not renewed by the commissioner, for as long as the third-party administrator continues to renew the certificate of registration timely, continues in business in this state, and remains in compliance with Iowa Code chapter 510 and this chapter.
[ARC 8310B, IAB 11/18/09, effective 12/23/09; ARC 5250C, IAB 11/4/20, effective 12/9/20; ARC 6547C, IAB 10/5/22, effective 11/9/22]