Iowa General Assembly Banner

 
Text: HF00556                           Text: HF00558
Text: HF00500 - HF00599                 Text: HF Index
Bills and Amendments: General Index     Bill History: General Index

House File 557

Partial Bill History

Bill Text

PAG LIN
  1  1                                            HOUSE FILE 557
  1  2 
  1  3                             AN ACT
  1  4 RELATING TO THE OPERATION AND REGULATION OF CERTAIN INSURANCE
  1  5    COMPANIES AND MUTUAL ASSOCIATIONS, AND THE REGULATORY 
  1  6    AUTHORITY OF THE INSURANCE DIVISION OF THE DEPARTMENT OF 
  1  7    COMMERCE.
  1  8 
  1  9 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 
  1 10 
  1 11    Section 1.  Section 87.22, unnumbered paragraph 1, Code
  1 12 1997, is amended to read as follows:
  1 13    The president, vice president, secretary, and treasurer of
  1 14 a corporation other than a family farm corporation, but not to
  1 15 exceed four officers per corporation, may exclude themselves
  1 16 from workers' compensation coverage under chapters 85, 85A,
  1 17 and 85B by knowingly and voluntarily rejecting workers'
  1 18 compensation coverage by signing, and attaching to the
  1 19 workers' compensation or employers' liability policy,
  1 20 initially and upon renewal of the policy, a written rejection,
  1 21 or if such a policy is not issued, by signing a written
  1 22 rejection which is witnessed by two disinterested individuals
  1 23 who are not, formally or informally, affiliated with the
  1 24 corporation and which is filed by the corporation with the
  1 25 industrial commissioner, in substantially the following form:
  1 26    Sec. 2.  Section 507.3, subsection 1, Code 1997, is amended
  1 27 to read as follows:
  1 28    1.  Upon determining that an examination should be
  1 29 conducted, the commissioner or the commissioner's designee may
  1 30 issue an examination warrant appointing appoint one or more
  1 31 examiners to perform the examination and instructing instruct
  1 32 them as to the scope of the examination.  In conducting the
  1 33 examination, the examiner shall observe those guidelines and
  1 34 procedures set forth in the examiners' handbook adopted by the
  1 35 national association of insurance commissioners.  The
  2  1 commissioner may also employ other guidelines as the
  2  2 commissioner deems appropriate.
  2  3    Sec. 3.  Section 507C.34, subsection 2, paragraph a,
  2  4 subparagraph (3), Code 1997, is amended to read as follows:
  2  5    (3)  Claims falling within the priorities established in
  2  6 section 507C.42, subsections subsection 1 and 2.
  2  7    Sec. 4.  Section 507C.42, Code 1997, is amended to read as
  2  8 follows:
  2  9    507C.42  PRIORITY OF DISTRIBUTION.
  2 10    The priority of distribution of claims from the insurer's
  2 11 estate shall be in accordance with the order in which each
  2 12 class of claims is set forth.  Claims in each class shall be
  2 13 paid in full or adequate funds retained for the payment before
  2 14 the members of the next class receive any payment.  Subclasses
  2 15 shall not be established within a class.  The order of
  2 16 distribution of claims is:
  2 17    1.  Class 1.  The costs and expenses of administration,
  2 18 including but not limited to the following:
  2 19    a.  The actual and necessary costs of preserving or
  2 20 recovering the assets of the insurer.
  2 21    b.  Compensation for all authorized services rendered in
  2 22 the liquidation.
  2 23    c.  Necessary filing fees.
  2 24    d.  The fees and mileage payable to witnesses.
  2 25    e.  Authorized reasonable attorney's fees and other
  2 26 professional services rendered in the liquidation.
  2 27    f.  The reasonable expenses of a guaranty association or
  2 28 foreign guaranty association in handling claims.
  2 29    2.  Class 2.  Reasonable compensation to employees for
  2 30 services performed to the extent that they do not exceed two
  2 31 months of monetary compensation and represent payment for
  2 32 services performed within one year before the filing of the
  2 33 petition for liquidation or, if the rehabilitation preceded
  2 34 liquidation, within one year before the filing of the petition
  2 35 for rehabilitation.  Officers and directors are not entitled
  3  1 to the benefit of this priority.  The priority is in lieu of
  3  2 other similar priority which may be authorized by law as to
  3  3 wages or compensation of employees.
  3  4    3 2.  Class 3 2.  Claims under policies, including claims
  3  5 of the federal or any state or local government, for losses
  3  6 incurred, including third-party claims, claims against the
  3  7 insurer for liability for bodily injury or for injury to or
  3  8 destruction of tangible property which are not under policies,
  3  9 claims of a guaranty association or foreign guaranty
  3 10 association, and claims for unearned premium.  Claims under
  3 11 life insurance and annuity policies, whether for death
  3 12 proceeds, annuity proceeds, or investment values, shall be
  3 13 treated as loss claims.  That portion of a loss,
  3 14 indemnification for which is provided by other benefits or
  3 15 advantages recovered by the claimant, shall not be included in
  3 16 this class, other than benefits or advantages recovered or
  3 17 recoverable in discharge of familial obligations of support or
  3 18 by way of succession at death or as proceeds of life
  3 19 insurance, or as gratuities.  A payment by an employer to an
  3 20 employee is not a gratuity.
  3 21    3.  Class 3.  Claims of the federal government except those
  3 22 under class 2.
  3 23    4.  Class 4.  Reasonable compensation to employees for
  3 24 services performed to the extent that they do not exceed two
  3 25 months of monetary compensation and represent payment for
  3 26 services performed within one year before the filing of the
  3 27 petition for liquidation or, if the rehabilitation preceded
  3 28 liquidation, within one year before the filing of the petition
  3 29 for rehabilitation.  Officers and directors are not entitled
  3 30 to the benefit of this priority.  The priority is in lieu of
  3 31 other similar priority which may be authorized by law as to
  3 32 wages or compensation of employees.
  3 33    4 5.  Class 4 5.  Claims of general creditors, including
  3 34 claims of ceding and assuming reinsurers in their capacity as
  3 35 such, and subrogation claims.
  4  1    5 6.  Class 5 6.  Claims of the federal or any state or
  4  2 local government except those under class 3 2.  Claims,
  4  3 including those of a governmental body for a penalty or
  4  4 forfeiture, are allowed in this class only to the extent of
  4  5 the pecuniary loss sustained from the act, transaction, or
  4  6 proceeding out of which the penalty or forfeiture arose, with
  4  7 reasonable and actual costs incurred.  The remainder of such
  4  8 claims shall be postponed to the class of claims under
  4  9 subsection 8 9.
  4 10    6 7.  Class 6 7.  Claims filed late or any other claims
  4 11 other than claims under subsections 7 8 and 8 9.
  4 12    7 8.  Class 7 8.  Surplus or contribution notes, or similar
  4 13 obligations, and premium refunds on assessable policies.
  4 14 Payments to members of domestic mutual insurance companies are
  4 15 limited in accordance with law.
  4 16    8 9.  Class 8 9.  The claims of shareholders or other
  4 17 owners.
  4 18    Sec. 5.  Section 507C.59, Code 1997, is amended to read as
  4 19 follows:
  4 20    507C.59  SUBORDINATION OF CLAIMS FOR NONCOOPERATION.
  4 21    If an ancillary receiver in another state or foreign
  4 22 country, whether called by that name or not, fails to transfer
  4 23 to the domiciliary liquidator in this state assets within the
  4 24 ancillary receiver's control other than special deposits,
  4 25 diminished only by the expenses of the ancillary receivership,
  4 26 the claims filed in the ancillary receivership, other than
  4 27 special deposit claims or secured claims, shall be placed in
  4 28 the class of claims under section 507C.42, subsection 7 8.
  4 29    Sec. 6.  Section 508.10, Code 1997, is amended by adding
  4 30 the following new unnumbered paragraph:
  4 31    NEW UNNUMBERED PARAGRAPH.  A foreign company authorized to
  4 32 do business in this state shall not assumptively reinsure a
  4 33 block of business which includes policyholders residing in
  4 34 this state to a company not authorized to do business in this
  4 35 state without the prior written approval of the commissioner.
  5  1    Sec. 7.  Section 508.14, Code 1997, is amended to read as
  5  2 follows:
  5  3    508.14  VIOLATION BY DOMESTIC COMPANY – DISSOLUTION OR
  5  4 ADMINISTRATIVE PENALTY.
  5  5    1.  Upon a failure of a company organized under the laws of
  5  6 this state to make the deposit provided in section 511.8,
  5  7 subsection 16, or file the statement in the time herein
  5  8 stated, or to file in a timely manner any financial statement
  5  9 required by rule of the commissioner of insurance, the
  5 10 commissioner of insurance shall notify the attorney general of
  5 11 the default, who shall at once apply to the district court of
  5 12 the county where the home office of the company is located for
  5 13 an order requiring the company to show cause, upon reasonable
  5 14 notice to be fixed by the court, why its business shall not be
  5 15 discontinued.  If, upon the hearing, no sufficient cause is
  5 16 not shown, the court shall decree its dissolution.
  5 17    2.  In lieu of a district court action authorized by this
  5 18 section, the commissioner may impose an administrative penalty
  5 19 of three five hundred dollars upon the company.  The right of
  5 20 the company to transact further new business in this state
  5 21 shall immediately cease until the requirements of this chapter
  5 22 have been fully complied with.
  5 23    3.  The commissioner may give notice to a company, which
  5 24 has failed to file evidence of deposit and all delinquent
  5 25 statements within the time fixed, that the company is in
  5 26 violation of this section.  If the company fails to file
  5 27 evidence of deposit and all delinquent statements within ten
  5 28 days of the date of the notice, the company is subject to an
  5 29 additional administrative penalty of one hundred dollars for
  5 30 each day the failure continues.
  5 31    4.  Amounts received by the commissioner pursuant to
  5 32 subsections 2 and 3 shall be paid to the treasurer of state
  5 33 for deposit in the general fund of the state as provided in
  5 34 section 505.7.
  5 35    Sec. 8.  Section 511.36, subsection 2, Code 1997, is
  6  1 amended to read as follows:
  6  2    2.  The rate of interest charged on a policy loan made
  6  3 under subsection 1, paragraph "b", shall not exceed the
  6  4 greater of the following:
  6  5    a.  The published monthly average for the calendar month
  6  6 ending two months before the date on which the rate is
  6  7 determined.  For purposes of this subsection, "published
  6  8 monthly average" means one of the following:
  6  9    (1)  Moody's corporate bond yield average-monthly average
  6 10 corporates as published in Moody's investors service, inc., or
  6 11 any successor to the investors service.
  6 12    (2)  If Moody's corporate bond yield average-monthly
  6 13 average corporates is no longer published, a substantially
  6 14 similar average established by rule issued by the commissioner
  6 15 of insurance.
  6 16    On or before the first day of each month, the commissioner
  6 17 of insurance shall determine the published monthly average for
  6 18 the calendar month ending one month before the date on which
  6 19 the monthly average is determined, and publish the rate, as a
  6 20 notice in the Iowa administrative bulletin or as a legal
  6 21 notice in a newspaper of general circulation published in Polk
  6 22 county prior to the first day of the following calendar month.
  6 23 This published monthly average is effective on the first day
  6 24 of the following calendar month.  The determination of this
  6 25 published monthly average by the commissioner of insurance is
  6 26 exempt from chapter 17A.
  6 27    b.  The rate used to compute the cash surrender values
  6 28 under the policy during the applicable period plus one percent
  6 29 per annum.
  6 30    Sec. 9.  NEW SECTION.  514B.33  ESTABLISHMENT OF LIMITED
  6 31 SERVICE ORGANIZATIONS.
  6 32    1.  A person may apply to the commissioner for and obtain a
  6 33 certificate of authority to establish and operate a limited
  6 34 service organization in compliance with this chapter.  A
  6 35 person shall not establish or operate a limited service
  7  1 organization in this state, or sell, offer to sell, or solicit
  7  2 offers to purchase or receive advance or periodic
  7  3 consideration in conjunction with a limited service
  7  4 organization without obtaining a certificate of authority
  7  5 under this chapter.
  7  6    2.  The commissioner shall adopt rules pursuant to chapter
  7  7 17A establishing a certification process for limited service
  7  8 organizations.
  7  9    3.  a.  For purposes of this section, "limited service
  7 10 organization" means an organization providing dental care
  7 11 services, vision care services, mental health services,
  7 12 substance abuse services, pharmaceutical services, podiatric
  7 13 care services, or such other services as may be determined by
  7 14 the commissioner.
  7 15    b.  "Limited service organization" does not include an
  7 16 organization providing hospital, medical, surgical, or
  7 17 emergency services, except as such services are provided
  7 18 incident to those services identified in paragraph "a".
  7 19    Sec. 10.  Section 515.35, subsection 3, paragraph a,
  7 20 subparagraph (2), subparagraph subdivision (a), Code 1997, is
  7 21 amended to read as follows:
  7 22    (a)  That the loan will be fully collateralized by cash,
  7 23 cash equivalents, or obligations issued or guaranteed by the
  7 24 United States or an agency or an instrumentality of the United
  7 25 States, and that the collateral will be adjusted as necessary
  7 26 each business day during the term of the loan to maintain the
  7 27 required collateralization in the event of market value
  7 28 changes in the loaned securities or collateral.
  7 29    Sec. 11.  Section 515.51, Code 1997, is amended to read as
  7 30 follows:
  7 31    515.51  POLICIES – EXECUTION – REQUIREMENTS.
  7 32    All policies or contracts of insurance made or entered into
  7 33 by the company may be made either with or without the seal of
  7 34 the company, but shall be subscribed by the president, or such
  7 35 other officer as may be designated by the directors for that
  8  1 purpose, and be attested to by the secretary or the
  8  2 secretary's designee of the company.  A policy or contract
  8  3 authorized by this chapter shall not be delivered in this
  8  4 state unless it is an individual policy or contract form A
  8  5 group motor vehicle or group homeowners policy shall not be
  8  6 written or delivered within this state unless such policy is
  8  7 an individual policy or contract form.
  8  8    Sec. 12.  NEW SECTION.  515.68A  FOREIGN COMPANIES –
  8  9 REINSURANCE.
  8 10    A foreign company authorized to do business in this state
  8 11 shall not assumptively reinsure a block of business which
  8 12 includes policyholders residing in this state to a company not
  8 13 authorized to do business in this state without the prior
  8 14 written approval of the commissioner.
  8 15    Sec. 13.  Section 515B.1, Code 1997, is amended by striking
  8 16 the section and inserting in lieu thereof the following:
  8 17    515B.1  SCOPE.
  8 18    This chapter shall apply to all kinds of direct insurance
  8 19 authorized to be written by an insurer licensed to operate in
  8 20 this state under chapter 515 or chapter 520, but shall not be
  8 21 applicable to the following:
  8 22    1.  Life, annuity, health, or disability insurance.
  8 23    2.  Mortgage guaranty, financial guaranty or other forms of
  8 24 insurance offering protection against investment risks.
  8 25    3.  Fidelity or surety bonds, or any other bonding
  8 26 obligations.
  8 27    4.  Credit insurance, vendors' single interest insurance,
  8 28 or collateral protection insurance or any similar insurance
  8 29 protecting the interests of a creditor arising out of a
  8 30 creditor-debtor transaction.
  8 31    5.  Insurance warranties or service contracts, including
  8 32 insurance that provides for the repair, replacement, or
  8 33 service of goods or property, or indemnification for repair,
  8 34 replacement, or service, for the operational or structural
  8 35 failure of the goods or property due to a defect in materials,
  9  1 workmanship, or normal wear and tear, or provides
  9  2 reimbursement for the liability incurred by the issuer of
  9  3 agreements or service contracts that provide such benefits.
  9  4    6.  Title insurance.
  9  5    7.  Ocean marine insurance.
  9  6    8.  A transaction or combination of transactions between a
  9  7 person, including affiliates of such person, and an insurer,
  9  8 including affiliates of such insurer, which involves the
  9  9 transfer of investment or credit risk unaccompanied by
  9 10 transfer of insurance risk.
  9 11    9.  Insurance provided by or guaranteed by government.
  9 12    Sec. 14.  Section 515B.2, Code 1997, is amended by adding
  9 13 the following new subsection:
  9 14    NEW SUBSECTION.  1A.  "Claimant" means an insured making a
  9 15 first party claim or any person instituting a liability claim
  9 16 against an insolvent insurer.  "Claimant" does not include a
  9 17 person who is an affiliate of an insolvent insurer.
  9 18    Sec. 15.  Section 515B.5, subsection 1, paragraph a, Code
  9 19 1997, is amended by striking the paragraph and inserting in
  9 20 lieu thereof the following:
  9 21    a.  Be obligated to pay covered claims existing prior to
  9 22 the final order of liquidation and arising within thirty days
  9 23 after the final order of liquidation, or before the policy
  9 24 expiration date if less than thirty days after the final order
  9 25 of liquidation, or before the insured replaces the policy or
  9 26 causes its cancellation, if the insured does so within thirty
  9 27 days of the final order of liquidation.  Such obligation shall
  9 28 be satisfied by paying to the claimant an amount as follows:
  9 29    (1)  The full amount of a covered claim for benefits under
  9 30 a workers' compensation insurance coverage.
  9 31    (2)  An amount in excess of one hundred dollars but not
  9 32 exceeding ten thousand dollars per policy for a covered claim
  9 33 for the return of unearned premium.
  9 34    (3)  An amount not exceeding the lesser of the policy
  9 35 limits or three hundred thousand dollars per claim for all
 10  1 covered claims for all damages arising out of any one or
 10  2 series of accidents, occurrences, or incidents, regardless of
 10  3 the number of persons making claims or the number of
 10  4 applicable policies.
 10  5    Sec. 16.  Section 515B.5, subsection 1, paragraph c, Code
 10  6 1997, is amended by adding the following new unnumbered
 10  7 paragraph:
 10  8    NEW UNNUMBERED PARAGRAPH.  The association shall also have
 10  9 the right to pursue and retain for its own account salvage and
 10 10 subrogation recoverable on paid covered claim obligations.  An
 10 11 obligation of the association to defend an insured shall cease
 10 12 upon the association's payment of an amount equal to the
 10 13 lesser of the association's covered claim obligation or the
 10 14 applicable policy limits.
 10 15    Sec. 17.  Section 515B.8, subsection 2, Code 1997, is
 10 16 amended to read as follows:
 10 17    2.  The association and any similar entity in another state
 10 18 shall be recognized as claimants in the liquidation of an
 10 19 insolvent insurer for any amounts paid by them on covered
 10 20 claim obligations as determined under this chapter or under
 10 21 similar law in another state, and shall receive dividends and
 10 22 any other distributions at the priority set forth under the
 10 23 applicable liquidation law.  The receiver, liquidator, or
 10 24 statutory successor of an insolvent insurer shall be bound by
 10 25 determinations of covered claim eligibility under this chapter
 10 26 and by settlements of covered claims made by the association
 10 27 or a similar organization in another state.  The court having
 10 28 jurisdiction shall grant such claims priority, including the
 10 29 deductible portion thereof, equal to that which the claimant
 10 30 would have been entitled in the absence of this chapter
 10 31 against the assets of the insolvent insurer over all other
 10 32 claims not having statutory or secured priority.  The expenses
 10 33 of the association or similar organization in handling claims
 10 34 shall be accorded the same priority as the liquidator's
 10 35 expenses.
 11  1    Sec. 18.  Section 515B.15, unnumbered paragraph 1, Code
 11  2 1997, is amended to read as follows:
 11  3    All proceedings to which the insolvent insurer is a party
 11  4 or in which it is obligated to defend a party shall be stayed
 11  5 from the date of the insolvency to and including the date set
 11  6 as the deadline for the filing of claims against the insolvent
 11  7 insurer or its receiver.  However, upon application, the court
 11  8 having jurisdiction of the receivership, may lengthen or
 11  9 shorten the period, either as to all claims or as to any
 11 10 particular claim.  The association may, at the option of the
 11 11 association, waive such stay as to specific cases involving
 11 12 covered claims.
 11 13    Sec. 19.  Section 515B.16, Code 1997, is amended to read as
 11 14 follows:
 11 15    515B.16  ACTIONS AGAINST THE ASSOCIATION.
 11 16    Actions against the association shall be brought against it
 11 17 in its the association's own name and only in the Polk county
 11 18 district court.  Service of original notice in actions against
 11 19 the association may be made on any officer thereof or upon the
 11 20 commissioner of insurance on its behalf.  The commissioner
 11 21 shall promptly transmit any notice so served upon the
 11 22 commissioner to the association.
 11 23    Sec. 20.  Section 515D.4, subsection 2, unnumbered
 11 24 paragraph 1, Code 1997, is amended to read as follows:
 11 25    Coverage under a policy A person shall not be canceled
 11 26 except by notice to the insured as provided in this chapter.
 11 27 Notice of cancellation of coverage under a policy is not
 11 28 effective excluded from the policy unless it the exclusion is
 11 29 based on one or more of the following reasons:
 11 30    Sec. 21.  Section 515D.5, Code 1997, is amended to read as
 11 31 follows:
 11 32    515D.5  DELIVERY OF NOTICE.
 11 33    1.  Notwithstanding the provisions of sections 515.80
 11 34 through 515.81A, a notice of cancellation of a policy shall
 11 35 not be effective unless mailed or delivered by the insurer to
 12  1 the named insured at least twenty days prior to the effective
 12  2 date of cancellation, or, where the cancellation is for
 12  3 nonpayment of premium notwithstanding the provisions of
 12  4 sections 515.80 and 515.81A at least ten days prior to the
 12  5 date of cancellation.  A post office department certificate of
 12  6 mailing to the named insured at the address shown in the
 12  7 policy shall be proof of receipt of such mailing.  Unless the
 12  8 reason accompanies the notice of cancellation, the notice
 12  9 shall state that, upon written request of the named insured,
 12 10 mailed or delivered to the insurer not less than fifteen days
 12 11 prior to the date of cancellation, the insurer will state the
 12 12 reason for cancellation, together with notification of the
 12 13 right to a hearing before the commissioner within fifteen days
 12 14 as provided in this chapter.
 12 15    When the reason does not accompany the notice of
 12 16 cancellation, the insurer shall, upon receipt of a timely
 12 17 request by the named insured, state in writing the reason for
 12 18 cancellation.  A statement of reason shall be mailed or
 12 19 delivered to the named insured within five days after receipt
 12 20 of a request.
 12 21    2.  A notice of exclusion of a person under a policy
 12 22 pursuant to section 515D.4, is not effective unless written
 12 23 notice is mailed or delivered to the named insured at least
 12 24 twenty days prior to the effective date of the exclusion.  The
 12 25 written notice shall state the reason for the exclusion,
 12 26 together with notification of the right to a hearing before
 12 27 the commissioner pursuant to section 515D.10 within fifteen
 12 28 days of receipt or delivery of a statement of reason as
 12 29 provided in this section.
 12 30    Sec. 22.  Section 518.7, Code 1997, is amended to read as
 12 31 follows:
 12 32    518.7  OFFICERS AND DIRECTORS – ELECTION.
 12 33    Officers or directors shall be elected in the manner and
 12 34 for the length of time prescribed in the articles of
 12 35 incorporation.  The same person shall not simultaneously hold
 13  1 the offices of president and secretary.
 13  2    Sec. 23.  Section 518A.6, Code 1997, is amended to read as
 13  3 follows:
 13  4    518A.6  OFFICERS – ELECTION.
 13  5    Officers or directors shall be elected in the manner and
 13  6 for the length of time prescribed in the articles of
 13  7 incorporation or bylaws.  The same person shall not
 13  8 simultaneously hold the offices of president and secretary.
 13  9    Sec. 24.  Section 521.13, Code 1997, is amended to read as
 13 10 follows:
 13 11    521.13  CONSOLIDATION PROHIBITED – EXCEPTION.
 13 12    No A company or companies as described in section 521.1
 13 13 shall not consolidate or reinsure except insofar as provided
 13 14 by section 515.49 with any other company or companies not
 13 15 authorized to transact business in this state or any insurance
 13 16 company or companies organized under the laws of another state
 13 17 without the commission's approval.
 13 18    Sec. 25.  Section 521A.1, subsection 6, unnumbered
 13 19 paragraph 1, Code 1997, is amended to read as follows:
 13 20    "Insurer" means a company qualified and licensed by the
 13 21 insurance division to transact the business of insurance in
 13 22 this state by certificate issued pursuant to chapters 508,
 13 23 514B, 515, 518A, 515E, and 520, except that it shall not
 13 24 include:
 13 25    Sec. 26.  Section 521A.3, subsection 4, paragraph a, Code
 13 26 1997, is amended to read as follows:
 13 27    a.  The commissioner shall approve any merger or other
 13 28 acquisition of control referred to in subsection 1 of this
 13 29 section unless if, after a public hearing thereon on such
 13 30 merger or acquisition, the applicant has demonstrated to the
 13 31 commissioner finds any all of the following:
 13 32    (1)  After the change of control the domestic insurer
 13 33 referred to in subsection 1 of this section would not will be
 13 34 able to satisfy the requirements for the issuance of a license
 13 35 to write the line or lines of insurance for which it is
 14  1 presently licensed.
 14  2    (2)  The effect of the merger or other acquisition of
 14  3 control would be will not substantially to lessen competition
 14  4 in insurance in this state or tend to create a monopoly
 14  5 therein.
 14  6    (3)  The financial condition of any acquiring party is such
 14  7 as might will not jeopardize the financial stability of the
 14  8 insurer, or prejudice the interest of its policyholders.
 14  9    (4)  The plans or proposals which the acquiring party has
 14 10 to liquidate the insurer, sell its assets or consolidate or
 14 11 merge it with any person, or to make any other material change
 14 12 in its business or corporate structure or management, are not
 14 13 unfair and or unreasonable to policyholders of the insurer and
 14 14 are not in contrary to the public interest.
 14 15    (5)  The competence, experience, and integrity of those
 14 16 persons who would control the operation of the insurer are
 14 17 such that it would not be in the interest sufficient to
 14 18 indicate that the interests of policyholders of the insurer
 14 19 and of the public to permit will not be jeopardized by the
 14 20 merger or other acquisition of control.
 14 21    Sec. 27.  Section 515B.25, Code 1997, is repealed.  
 14 22 
 14 23 
 14 24                                                             
 14 25                               RON J. CORBETT
 14 26                               Speaker of the House
 14 27 
 14 28 
 14 29                                                             
 14 30                               MARY E. KRAMER
 14 31                               President of the Senate
 14 32 
 14 33    I hereby certify that this bill originated in the House and
 14 34 is known as House File 557, Seventy-seventh General Assembly.
 14 35 
 15  1 
 15  2                                                             
 15  3                               ELIZABETH ISAACSON
 15  4                               Chief Clerk of the House
 15  5 Approved                , 1997
 15  6 
 15  7 
 15  8                         
 15  9 TERRY E. BRANSTAD
 15 10 Governor
     
Text: HF00556                           Text: HF00558
Text: HF00500 - HF00599                 Text: HF Index
Bills and Amendments: General Index     Bill History: General Index
Return To Home Iowa General Assembly

index Search: House Bills and Amendments (77th General Assembly)

© 1997 Cornell College and League of Women Voters of Iowa

Comments about this site or page? webmaster@legis.iowa.gov. Please remember that the person listed above does not vote on bills. Direct all comments concerning legislation to State Legislators.

Last update: Tue Jan 13 03:41:17 CST 1998
URL: /DOCS/GA/77GA/Legislation/HF/00500/HF00557/970505.html
jhf