House File 2263 - Introduced HOUSE FILE 2263 BY COMMITTEE ON COMMERCE (SUCCESSOR TO HSB 554) (COMPANION TO SF 2153 BY COMMITTEE ON COMMERCE) A BILL FOR An Act relating to the insurance commissioner’s authority 1 concerning insurance producers, business entity producers, 2 and preneed sellers. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5287HV (1) 90 nls/ko

H.F. 2263 Section 1. Section 505.17, subsection 1, paragraph a, Code 1 2024, is amended to read as follows: 2 a. Information, records, and documents utilized for the 3 purpose of, or in the course of, investigation, regulation, 4 or examination of an insurance company , or insurance holding 5 company, an individual insurance producer, or a business entity 6 producer received by the division from some other governmental 7 entity which treats such information, records, and documents 8 as confidential, are confidential and shall not be disclosed 9 by the division and are not subject to subpoena. Such 10 information, records, and documents do not constitute a public 11 record under chapter 22 . 12 Sec. 2. Section 522B.11, subsection 1, paragraph q, Code 13 2024, is amended to read as follows: 14 q. Is the subject of an order of the securities 15 administrator of this state or any other state, province, 16 district, or territory, denying, suspending, revoking, 17 or otherwise taking action against a registration as a 18 broker-dealer, agent, investment adviser, or investment adviser 19 representative issued by any of the following: 20 (1) The securities administrator of this state or any other 21 state, province, district, or territory. 22 (2) The federal securities and exchange commission. 23 (3) The financial industry regulatory authority . 24 Sec. 3. Section 523A.807, subsection 3, paragraph a, Code 25 2024, is amended to read as follows: 26 a. Payment of a civil penalty of not more than one thousand 27 dollars for each violation, but not exceeding an aggregate of 28 ten thousand dollars during any six-month period, except that 29 if the commissioner finds that the person knew or reasonably 30 should have known that the person was in violation of such 31 provisions a section or rules adopted pursuant thereto to a 32 section , the penalty shall be not more than five thousand 33 dollars for each violation, but and not exceeding exceed an 34 aggregate of fifty thousand dollars during any six-month 35 -1- LSB 5287HV (1) 90 nls/ko 1/ 3

H.F. 2263 period. The commissioner shall assess the penalty on the 1 employer of an individual and not on the individual, if 2 the commissioner finds that the violations committed by the 3 individual were directed, encouraged, condoned, ignored, or 4 ratified by the individual’s employer. Any civil penalties 5 collected under this subsection shall be deposited as provided 6 in section 505.7 . 7 EXPLANATION 8 The inclusion of this explanation does not constitute agreement with 9 the explanation’s substance by the members of the general assembly. 10 This bill relates to the insurance commissioner’s authority 11 concerning insurance producers, business entity producers, and 12 preneed sellers. 13 Under current law, confidential information includes 14 the information, records, and documents utilized for the 15 investigation, regulation, or examination of an insurance 16 company or insurance holding company. The bill also applies 17 to the confidential information of an individual insurance 18 producer or a business entity producer. Such information, 19 records, and documents are confidential, and shall not be 20 disclosed by the insurance division and are not subject to 21 subpoena. 22 Current law permits the commissioner to place on probation, 23 or suspend, revoke, or refuse to issue or renew an insurance 24 producer’s license, or levy a civil penalty, if the 25 insurance producer is the subject of an order of a securities 26 administrator. The bill includes an insurance producer that is 27 the subject of an order of the federal securities and exchange 28 commission or the financial industry regulatory authority. 29 The penalty for a violation of Code chapter 523A shall be a 30 civil penalty of not more than $1,000 for each violation, not 31 to exceed an aggregate of $10,000 during any six-month period, 32 except if the commissioner finds that the person knew or 33 reasonably should have known that the person was in violation 34 of specific laws or rules related to cemetery and funeral 35 -2- LSB 5287HV (1) 90 nls/ko 2/ 3

H.F. 2263 merchandise, and funeral services, the penalty shall not exceed 1 $5,000 for each violation, or an aggregate of $50,000 during 2 any six-month period. 3 -3- LSB 5287HV (1) 90 nls/ko 3/ 3