Department of Insurance Rulemaking for 2009
Rule 18.01.09 – SENIOR CONSUMER PROTECTION IN ANNUITY TRANSACTIONS
In 2008, House Bill 411 amended Idaho's senior annuity suitability law to extend the annuity sales protections to all consumers rather than just senior consumers. This rulemaking amends the senior annuity protection rule to make it applicable to all consumers.
Rule 18.01.29 – RESTRICTIONS ON DISCRETIONARY CLAUSES
This is a new rule that prohibits the use of discretionary clauses in non-employer health insurance contracts. Discretionary clauses are clauses in insurance contracts that purport to give the insurer the sole discretion to determine an insured's eligibility for benefits under the insurance contract. The pending rule does not apply to group health plans offered to employees by or through their employer.
Rule 18.01.39 – REBATES AND ILLEGAL INDUCEMENTS IN TITLE INSURANCE BUSINESS (chapter repeal and new chapter)
An administrative hearing officer concluded that the existing Rule 18.01.39 goes beyond the scope of Idaho insurance statutes by prohibiting producers of title insurance from having a financial interest in a title entity. The pending rule will replace the prohibition on financial interests in a title entity with a requirement that producers of title insurance disclose any financial interest they may have in a title entity to which they refer title insurance consumers.
Rule 18.01.43 – CERTIFICATION OF FIRE CODE OFFICIALS
This rulemaking implements HB 620, passed during the 2008 legislative session, which requires that the Fire Marshal establish a rule for uniform training and continuing education for all persons acting as assistants to the state fire marshal.
Rule 18.01.44 – SCHEDULE OF FEES, LICENSES AND MISCELLANEOUS CHARGES
The rule imposes a fee for rates and forms filings submitted in paper form. Insurers filing ten or fewer rates and forms per year will not be charged a fee; however, a fee of $20 will be charged for each paper rate or form filed in excess of ten. The fee will not apply to any filings made electronically through the national System for Electronic Rates and Forms Filing (SERFF). The use of electronic filing provides conveniences to the insurer and eliminates the need for Department staff to convert paper forms to electronic format.
Rule 18.01.61 – CREDIT LIFE AND CREDIT DISABILITY INSURANCE
In 2003, Idaho adopted a model law governing licensing of insurance agents, now known as “producers.” The rule amended by this proposed rulemaking was never changed to conform to the model law. The pending rule will correct obsolete code references and terminology, and remove inconsistencies with the current law. Changes are also made to conform the rule to Office of Administrative Rules standards.
Rule 18.01.62 – AUDITED FINANCIAL REPORTING
The rule is being renamed “Annual Financial Reporting” and revised to require that insurers comply with certain best practices related to auditor independence, corporate governance and internal control over financial reporting in order to comply with amendments to the National Association of Insurance Commissioners (NAIC) Model Audit Rule that are required to be in place by 2010 to meet NAIC Accreditation Standards.
Rule 18.01.73 – RULE TO IMPLEMENT THE INDIVIDUAL HEALTH INSURANCE AVAILABILITY ACT PLAN DESIGN
The rule amends Rule 73, which sets forth the required benefits for health insurance products reinsured through the Idaho Individual High Risk Reinsurance Pool. The proposed changes include an increase in the lifetime maximum benefit for organ transplants from $150,000 to $250,000, a change to a section dealing with cosmetic surgery to make it consistent with the minimum requirements for individual health benefit plans established by IDAPA 18.01.30, some wording changes for consistency and clarity, and changes to conform the rule to Office of Administrative Rules guidelines.
Rule 18.01.77 – ACTUARIAL OPINION AND MEMORANDUM RULE
Section 41-612(12)(d)(iv), Idaho Code, permits the Director to rely on a foreign or alien insurer's home state regulator regarding the preparation and filing of an actuarial report. This proposed rule amends Rule 77 to provide an exemption from filing with Idaho a report known as the Regulatory Asset Adequacy Issues Summary (the “RAAIS”) for a foreign or alien insurer whose state of domicile imposes reporting requirements substantially similar to those imposed by Idaho. The RAAIS is not part of the NAIC's electronic filings due to its confidential nature. Therefore, insurers must file a paper copy with the Idaho Department of Insurance, or an electronic copy, which is printed. The Department does not utilize an actuary to review RAAIS reports filed by non-domestic insurers, thus this filing requirement is largely perfunctory. The rule change is proposed to take effect December 31, 2008 so the exemption can be implemented for the 2008 annual financial filing period in order to reduce the use and cost of paper and expense of mailing for affected insurers.
Rule 18.01.80 – PRENEED LIFE INSURANCE MINIMUM STANDARDS FOR DETERMINING RESERVE LIABILITIES AND NONFORFEITURE VALUES
This rule establishes the 1980 CSO Mortality Table as the minimum standard for computation of policy reserves and nonforfeiture values for preneed policies, which are offered by life insurers to cover funeral and burial expenses. It is based on a model regulation recently developed by the National Association of Insurance Commissioners in conjunction with the insurance industry to address a finding by the Society of Actuaries that the mortality table slated to become the minimum standard effective January 1, 2009 produces inadequate reserves. The rule allows companies a time period to transition to the use of the 1980 CSO Mortality Tables and provides notice requirements to keep the Director of the Department of Insurance informed on which table is in use.