Text: SSB01138 Text: SSB01140 Text: SSB01100 - SSB01199 Text: SSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. Section 505.17, Code 1999, is amended to read 1 2 as follows: 1 3 505.17 CONFIDENTIAL INFORMATION. 1 4 Information, records, and documents utilized for the 1 5 purpose of, or in the course of, investigation, regulation, or 1 6 examination of an insurance company or insurance holding 1 7 company, received by the division from some other governmental 1 8 entity which treats such information, records, and documents 1 9 as confidential, are confidential and shall not be disclosed 1 10 by the division and are not subject to subpoena. Such 1 11 information, records, and documents do not constitute a public 1 12 record under chapter 22. 1 13 The disclosure of confidential information, administrative 1 14 or judicial orders which contain confidential information, or 1 15 information regarding other action of the division which is 1 16 not a public record subject to disclosure, to other regulatory 1 17 officialsfrom this or other statesmay be permitted by the 1 18 commissioner provided that those officials are subject to, or 1 19 agree to comply with, standards of confidentiality comparable 1 20 to those imposed on the commissioner. 1 21 Sec. 2. Section 508B.6, Code 1999, is amended to read as 1 22 follows: 1 23 508B.6 APPROVAL OF PLAN BY POLICYHOLDERS – NOTICE OF 1 24 ELECTION – EFFECTIVE DATE. 1 25After the plan has been approved by the commissioner as1 26provided in section 508B.7, theThe plan of conversion shall 1 27 be submitted to and shall not take effect until approved by 1 28 two thirds of the policyholders of the mutual company voting 1 29 on the plan. Notice of a meeting for the purpose of voting on 1 30 the conversion plan shall be provided by mail to each 1 31 policyholder entitled to vote in accordance with the articles 1 32 of incorporation or bylaws of the mutual company. Each 1 33 policyholder entitled to vote may cast one vote unless 1 34 otherwise provided in the articles of incorporation or bylaws 1 35 of the mutual company. Voting shall be by ballot, in person 2 1 or by proxy. A quorum shall consist of a quorum as defined in 2 2 the articles of incorporation or bylaws of the mutual company. 2 3 A copy of the plan of conversion, or a summary of the plan of 2 4 conversion, shall accompany the notice of meeting and 2 5 election. The notice of meeting may contain the notice of any 2 6 planned public hearing. An approved plan of conversion shall 2 7 take effect on the date specified in the plan. 2 8 Sec. 3. Section 508B.13, Code 1999, is amended to read as 2 9 follows: 2 10 508B.13 PROHIBITIONS ON CERTAIN OFFERS TO ACQUIRE SHARES. 2 11 Prior to and for a period of five years following the 2 12 effective date of the conversion, and in the case of the plans 2 13 of conversion specified in subsections 1 and 3 of section 2 14 508B.3, five years following the date of distribution of 2 15 consideration to the policyholders in exchange for their 2 16 membership interests, a person, shall not directly or 2 17 indirectly acquire or offer to acquire the beneficial 2 18 ownership of more than five percent of any class of voting 2 19 security of the reorganized company unless the acquisition is 2 20 approved by the commissioner as being consistent with the plan 2 21 of conversion and by the board of directors of the reorganized 2 22 company, or is made pursuant toa plan approved by the2 23commissioner, made pursuant tothe plan of conversion, or made2 24after the initial public offering from a broker or dealer of2 25registered securities with the securities and exchange2 26commission at the quoted price on the date of purchase. An 2 27 approved plan of conversion may include a stock option plan. 2 28 As used in this section, "beneficial ownership" means, with 2 29 respect to a security, the sole or shared power to vote or 2 30 direct the voting of the security or the sole power to dispose 2 31 or direct the disposition of the security. 2 32 Sec. 4. Section 511.28, Code 1999, is amended to read as 2 33 follows: 2 34 511.28 SERVICE OF PROCESS. 2 35 Any notice or process, with three copies of the notice or 3 1 process, may be mailed to the commissioner at Des Moines, 3 2 Iowa, in a certified mail letter addressed to the commissioner 3 3 by the commissioner's official title. The commissioner shall 3 4 acknowledge service on behalf of the defendant foreign 3 5 insurance company by writing, giving the date of receipt of 3 6 the notice or process, and shall return the notice or process 3 7 in a certified mail letter to the clerk of the court in which 3 8 the suit is pending, addressed to the clerk by the clerk's 3 9 official title, and shall also mail a copy, with a copy of the 3 10 commissioner's acknowledgment of service written thereon, in a 3 11 certified mail letter addressed to the person or corporation 3 12 named or designated by such company in the written instrument. 3 13 Notice or process received prior to12 noon10 a.m. shall be 3 14 forwarded the same working day. Notice or process received 3 15 after12 noon10 a.m. shall be forwarded the next working day. 3 16 A fee of fifteen dollars must accompany the request for notice 3 17 or process. 3 18 Sec. 5. Section 513C.7, subsection 1, paragraph a, Code 3 19 1999, is amended to read as follows: 3 20 a. The individual is covered or is eligible for coverage 3 21 under a health benefit plan provided by the individual's 3 22 employer or is covered as the spouse or dependent of another 3 23 individual covered or eligible for coverage under a health 3 24 benefit plan provided by that individual's employer. 3 25 Sec. 6. Section 513C.7, subsection 4, paragraph b, Code 3 26 1999, is amended to read as follows: 3 27 b. A carrier or an organized delivery system shall waive 3 28 any time period applicable to a preexisting condition 3 29 exclusion or limitation period with respect to particular 3 30 services in an individual health benefit plan for the period 3 31 of time an individual was previously covered by qualifying 3 32 previous coverage that provided benefits with respect to such 3 33 services, provided that the qualifying previous coverage was 3 34 continuous to a date not more than sixty-three days prior to 3 35 the effective date of the new coverage. For purposes of this 4 1 section, periods of coverage under medical assistance provided 4 2 pursuant to chapter 249A or Medicare coverage provided 4 3 pursuant to Title XVIII of the federal Social Security Act 4 4 shall not be counted with respect to the sixty-three day 4 5 requirement. 4 6 Sec. 7. Section 515.26, Code 1999, is amended to read as 4 7 follows: 4 8 515.26 DIRECTORS. 4 9 The affairs of a company organized as provided by this 4 10 chapter shall be managed by a number of directors, of not less 4 11 than five nor more than twenty-one, all of whom, in case of a4 12stock company, shall be stockholders, or, in. In the case of 4 13 a mutual company, all such directors shall be policyholders,4 14or before the company shall effect insurance, be subscribers4 15for stock or for insurance as the case may be. 4 16 Sec. 8. Section 515.35, subsection 3, paragraph a, 4 17 subparagraph (2), subparagraph subdivision (a), Code 1999, is 4 18 amended to read as follows: 4 19 (a) That the loan will be fully collateralized by cash, 4 20 cash equivalents, or obligations issued or guaranteed by the 4 21 United States or an agency or an instrumentality of the United 4 22 States, and that the collateral will be adjusted as necessary 4 23 each business day during the term of the loan to maintain the 4 24 required collateralization in the event of market value 4 25 changes in the loaned securities or collateral. 4 26 If the loan is fully collateralized by cash, the 4 27 reinvestment of the cash may be made in either individual 4 28 securities or a pooled fund comprised of individual 4 29 securities. If such reinvestment is made in individual 4 30 securities, such securities must mature in less than ninety 4 31 days. If such reinvestment is made in a pooled fund, the 4 32 average maturity of the securities comprising such pooled fund 4 33 must be less than ninety days. Individual securities and 4 34 securities comprising the pooled fund shall be investment 4 35 grade. 5 1 Sec. 9. Section 515.74, Code 1999, is amended to read as 5 2 follows: 5 3 515.74 SERVICE OF PROCESS. 5 4 Any notice or process, with three copies of the notice or 5 5 process, may be mailed to the commissioner at Des Moines, 5 6 Iowa, in a certified mail letter addressed to the commissioner 5 7 by the commissioner's official title. The commissioner shall 5 8 acknowledge service on behalf of the defendant foreign 5 9 insurance company by writing, giving the date of receipt of 5 10 the notice or process, and shall return the notice or process 5 11 in a certified mail letter to the clerk of the court in which 5 12 the suit is pending, addressed to the clerk by the clerk's 5 13 official title, and shall also mail a copy, with a copy of the 5 14 commissioner's acknowledgment of service written thereon, in a 5 15 certified mail letter addressed to the person or corporation 5 16 named or designated by such company in the written instrument. 5 17 Notice or process received prior to12 noon10 a.m. shall be 5 18 forwarded the same working day. Notice or process received 5 19 after12 noon10 a.m. shall be forwarded the next working day. 5 20 A fee of fifteen dollars must accompany the request for notice 5 21 or process. 5 22 Sec. 10. Section 518.2, Code 1999, is amended to read as 5 23 follows: 5 24 518.2 ARTICLES – APPROVAL. 5 25Each suchAn organization shall present to the commissioner 5 26 of insurance for approval its articles of incorporation, which 5 27 shall show its name, objects and purposes, the time and place 5 28 of the annual meeting of the members, and the location of its 5 29 principal place of business, and any subsequent amendments to 5 30 its articles. The commissioner of insurance shallthensubmit 5 31 the articles of incorporation and any subsequent amendments to 5 32 the articles to the attorney general for examination, and if 5 33 found by the attorney general to be in accordance with the 5 34 provisions of this chapter and the Constitution and the laws 5 35 of the state, the attorney general shall certify such fact 6 1thereonon the articles of incorporation and on any amendments 6 2 to the articles and returnthe same to saidthem to the 6 3 commissioner, and no articles. Articles of incorporation and 6 4 amendments to the articles shall not be approved by the 6 5 commissioner or recorded unlessaccompanied by such6 6certificatecertified by the attorney general. 6 7 Sec. 11. Section 518.17, Code 1999, is amended to read as 6 8 follows: 6 9 518.17 REINSURANCE. 6 10AnyA county mutual insurance association may reinsure a 6 11 part or all of its risks with any association operating under 6 12 the provisions of this chapter, or with any other association 6 13 or company licensed in this state and authorized to write the 6 14 kinds of insurance enumerated in section 518.11. 6 15The commissioner of insurance may require any county mutual6 16insurance association to obtain reinsurance coverage as6 17provided for in this section if it appears to the commissioner6 18of insurance that the perils insured against and the classes6 19of properties insured may seriously endanger the financial6 20position of the association and the security of its members.6 21 Reinsurance sufficient to protect the financial stability 6 22 of the state mutual association is also required. Reinsurance 6 23 coverage obtained by a county mutual insurance association 6 24 shall not expose the association to a loss of more than 6 25 fifteen percent from surplus in any calendar year. The 6 26 commissioner of insurance may require additional reinsurance 6 27 if necessary to protect the policyholders of the association. 6 28 Sec. 12. Section 518.25, Code 1999, is amended to read as 6 29 follows: 6 30 518.25 SURPLUS. 6 31 An association organized under this chapter shall at all 6 32 times maintain a surplus of not less than fifty thousand 6 33 dollars or one-tenth of one percent of the gross property risk 6 34 in force, whichever is greater.Reinsurance sufficient to6 35protect the financial stability of the company is also7 1required. The insurance commissioner may require additional7 2reinsurance if necessary to protect the policyholders of the7 3company. An association authorized to transact business in7 4this state before July 1, 1990, shall meet this requirement7 5not later than July 1, 1993.7 6 Sec. 13. NEW SECTION. 518A.1A PLAN OF ORGANIZATION. 7 7 An entity seeking to organize as or convert to a state 7 8 mutual insurance association shall submit a plan of 7 9 organization to the commissioner for approval. 7 10 Sec. 14. Section 518A.8, Code 1999, is amended by striking 7 11 the section and inserting in lieu thereof the following: 7 12 518A.8 ARTICLES – APPROVAL. 7 13 An organization shall present to the commissioner of 7 14 insurance for approval its articles of incorporation, which 7 15 shall show its name, objects, and purposes, the time and place 7 16 of the annual meeting of the members, and the location of its 7 17 principal place of business, and any subsequent amendments. 7 18 The commissioner shall submit the articles of incorporation 7 19 and any subsequent amendments to the articles to the attorney 7 20 general for examination, and if found by the attorney general 7 21 to be in accordance with the provisions of this chapter and 7 22 the Constitution and the laws of this state, the attorney 7 23 general shall certify such fact on the articles of 7 24 incorporation and on any amendments to the articles and return 7 25 them to the commissioner. Articles of incorporation and 7 26 amendments to the articles shall not be approved by the 7 27 commissioner or recorded unless certified by the attorney 7 28 general. 7 29 Sec. 15. Section 518A.37, Code 1999, is amended to read as 7 30 follows: 7 31 518A.37 SURPLUS. 7 32 An association organized under this chapter shall at all 7 33 times maintain a surplus of not less than one hundred thousand 7 34 dollars, or one-tenth of one percent of the gross property 7 35 risk in force, whichever is greater.Reinsurance sufficient8 1to protect the financial stability of the company is also8 2required. The insurance commissioner may require additional8 3reinsurance if necessary to protect the policyholders of the8 4company. An association authorized to transact business in8 5this state before July 1, 1990, shall meet this requirement8 6not later than July 1, 1992.8 7 Sec. 16. Section 518A.44, Code 1999, is amended by 8 8 striking the section and inserting in lieu thereof the 8 9 following: 8 10 518A.44 REINSURANCE. 8 11 A state mutual insurance association may reinsure a part or 8 12 all of its risks with any association operating under the 8 13 provisions of this chapter, or with any other association or 8 14 company licensed in this state and authorized to write the 8 15 kinds of insurance enumerated in section 518A.1. 8 16 Reinsurance sufficient to protect the financial stability 8 17 of the state mutual association is required. Reinsurance 8 18 coverage obtained by an association shall not expose the 8 19 association to a loss of more than fifteen percent from 8 20 surplus in any calendar year. The commissioner of insurance 8 21 may require additional reinsurance if necessary to protect the 8 22 policyholders of the association. 8 23 Sec. 17. Section 519.11, Code 1999, is amended to read as 8 24 follows: 8 25 519.11 LIABILITY TO ASSESSMENTS. 8 26 The provisions as to maximum liability of members to 8 27 assessments when assets are insufficient and to assessments 8 28 when the corporation is insolvent, found in sections 518A.9,8 29518A.10,and 518A.14,and 518A.28,shall apply to all mutual 8 30 insurance corporations organized underthe provisions ofthis 8 31 chapter. 8 32 Sec. 18. Section 910.1, subsections 3 and 5, Code 1999, 8 33 are amended to read as follows: 8 34 3. "Pecuniary damages" means all damagesto the extent8 35 whether or not paid by an insurer, which a victim could 9 1 recover against the offender in a civil action arising out of 9 2 the same facts or event, except punitive damages and damages 9 3 for pain, suffering, mental anguish, and loss of consortium. 9 4 Without limitation, "pecuniary damages" includes damages for 9 5 wrongful death and expenses incurred for psychiatric or 9 6 psychological services or counseling or other counseling for 9 7 the victim which became necessary as a direct result of the 9 8 criminal activity. 9 9 5. "Victim" means a person who has suffered pecuniary 9 10 damages as a result of the offender's criminal activities. 9 11However, for purposes of this chapter, an insurer is not a9 12victim and does not have a right of subrogation.Thecrime9 13victim compensation program is not an insurer for purposes of9 14this chapter, and theright of subrogation provided by section 9 15 915.92 does not prohibit restitution to the crime victim 9 16 compensation program. 9 17 Sec. 19. Sections 518A.10, 518A.13, 518A.17, and 518A.28, 9 18 Code 1999, are repealed. 9 19 EXPLANATION 9 20 This bill amends provisions relating to the regulation of 9 21 insurance companies. 9 22 Code section 505.17 is amended to provide that information, 9 23 records, and documents utilized for the purpose of, or in the 9 24 course of, investigation, regulation, or examination of an 9 25 insurer or insurance holding company, received by the division 9 26 from some other governmental entity which treats such 9 27 information, records, and documents as confidential, are 9 28 confidential and shall not be disclosed by the division and 9 29 are not subject to subpoena. Such information, records, and 9 30 documents do not constitute a public record under Code chapter 9 31 22. 9 32 Code section 508B.6 is amended to strike the requirement 9 33 that a plan of conversion from a mutual life insurance company 9 34 to a stock life insurance company be approved by the 9 35 commissioner prior to being submitted to the policyholders for 10 1 approval. 10 2 Code section 508B.13 is amended to provide that a person 10 3 shall not directly or indirectly acquire or offer to acquire 10 4 the beneficial ownership of more than 5 percent of any class 10 5 of voting security of the reorganized company unless the 10 6 acquisition is approved by the commissioner as being 10 7 consistent with the plan of conversion and by the board of 10 8 directors of the reorganized company, or is made pursuant to 10 9 the plan of conversion. Currently, a person is prohibited 10 10 from acquiring or offering to acquire the beneficial ownership 10 11 of the reorganized company unless the acquisition is made 10 12 pursuant to a plan approved by the commissioner, made pursuant 10 13 to the plan of conversion, or made after the initial public 10 14 offering from a broker or dealer of registered securities with 10 15 the securities and exchange commission at the quoted price on 10 16 the date of purchase. 10 17 Code sections 511.28 and 515.74, relating to the mailing of 10 18 notice or process to the commissioner on behalf of a foreign 10 19 insurance company, is amended to provide that notice or 10 20 process received by the commissioner prior to 10 a.m. is to be 10 21 forwarded the same working day, and notice or process received 10 22 after 10 a.m. is to be forwarded the next working day. 10 23 Currently, the time for determining when service or process is 10 24 forwarded is 12 noon. 10 25 Code section 513C.7, relating to the availability of 10 26 coverage to an individual under a basic or standard health 10 27 benefit plan, is amended to exclude from the guarantee of 10 28 coverage, an individual who is covered or is eligible for 10 29 coverage under a health benefit plan provided by an employer 10 30 as a spouse or dependent of an employee. The section is also 10 31 amended to exclude from qualifying coverage, periods of 10 32 coverage under medical assistance provided pursuant to Code 10 33 chapter 249A and Medicare coverage provided pursuant to Title 10 34 XVIII of the federal Social Security Act. 10 35 Code section 515.26 is amended to eliminate the requirement 11 1 that a director of a domestic stock property and casualty 11 2 insurance company own stock in such company as a prerequisite 11 3 to becoming and remaining a director. 11 4 Code section 515.35 is amended to provide that cash used to 11 5 collateralize a loan of stocks or obligations held by an 11 6 insurance company may be reinvested in either individual 11 7 securities or a pooled fund comprised of individual 11 8 securities. If the reinvestment is made in individual 11 9 securities, such securities must mature in less than 90 days. 11 10 If the reinvestment is made in a pooled fund comprised of 11 11 securities, the average maturity of such securities must be 11 12 less than 90 days. Individual securities and securities 11 13 comprising a pooled fund must be investment grade. 11 14 Code section 518.2 is amended to provide that articles of 11 15 incorporation of a county mutual insurance association and any 11 16 amendments to such articles which are submitted to the 11 17 insurance commissioner, must be approved by the commissioner 11 18 and certified by the attorney general. 11 19 Code section 518.17, relating to reinsurance, is amended to 11 20 add language currently contained in Code section 518.25 which 11 21 relates to reinsurance. Similar language currently contained 11 22 in Code section 518.25 is struck. 11 23 Code section 518.25 is amended by striking language which 11 24 is moved to Code section 518.17. 11 25 New Code section 518A.1A is created and provides that an 11 26 entity seeking to organize as, or convert to, a state mutual 11 27 association must submit a plan of organization to the 11 28 commissioner for approval. 11 29 Code section 518A.8 is amended by striking the existing 11 30 language which requires a state mutual insurance association 11 31 to submit its articles of incorporation, bylaws, and policy 11 32 form to the commissioner, and inserts language relating to the 11 33 submission and approval of such association's articles of 11 34 incorporation which is the same as that provided for county 11 35 mutual insurance associations in Code section 518.2, as 12 1 amended in this bill. 12 2 Code section 518A.37 is amended to provide that a state 12 3 mutual insurance association must maintain a surplus the 12 4 greater of $100,000 or one-tenth of 1 percent of the gross 12 5 property risk in force. Currently, such associations must 12 6 maintain a surplus of $100,000. Additionally, language is 12 7 struck regarding reinsurance. Similar reinsurance language is 12 8 incorporated in the amendment to Code section 518A.44. 12 9 Code section 518A.44, relating to limitations on risks 12 10 applicable to a state mutual insurance association, is struck 12 11 and replaced by language relating to reinsurance. The new 12 12 language provides that a state mutual insurance association 12 13 may reinsure a part or all of its risks. The bill provides 12 14 that reinsurance sufficient to protect the financial stability 12 15 of the state mutual association is required. Reinsurance 12 16 coverage obtained by an association shall not expose the 12 17 association to a loss of more than 15 percent from surplus in 12 18 any calendar year. The insurance commissioner is authorized 12 19 to require additional reinsurance if necessary to protect the 12 20 policyholders of the association. 12 21 Code section 519.11 is amended to correct internal 12 22 references as a result of the repeal of sections 518A.10 and 12 23 518A.28. 12 24 Code chapter 910 is amended to provide that an insurance 12 25 company is a victim for purposes of chapter 910 and therefore 12 26 eligible for restitution. 12 27 The bill repeals several sections pertaining to state 12 28 mutual insurance associations including sections relating to 12 29 advance assessments for losses and expenses, authorization for 12 30 state mutual insurance associations to issue policies of fixed 12 31 premiums, special assessments associated with damages paid for 12 32 hail losses, and receivership of state mutual insurance 12 33 associations (such receivership would be governed by Code 12 34 chapter 507C, relating to insurers supervision, 12 35 rehabilitation, and liquidation). 13 1 LSB 1421DP 78 13 2 mj/jw/5.4
Text: SSB01138 Text: SSB01140 Text: SSB01100 - SSB01199 Text: SSB Index Bills and Amendments: General Index Bill History: General Index
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