CHAPTER 31. INTERSTATE INSURANCE PRODUCT REGULATION COMPACT
IC 27-8-31
Chapter 31. Interstate Insurance Product Regulation Compact
IC 27-8-31-1
Purpose
Sec. 1. The purposes of this compact are, through means of jointand cooperative action among the compacting states, to:
(1) promote and protect the interest of consumers of individualand group annuity, life insurance, disability income, and longterm care insurance products;
(2) develop uniform standards for insurance products coveredunder the compact;
(3) establish a central clearinghouse to receive and provideprompt review of insurance products covered under the compactand, in certain cases, advertisements related thereto, submittedby insurers authorized to do business in one (1) or morecompacting states;
(4) give appropriate regulatory approval to product filings andadvertisements satisfying the applicable uniform standard;
(5) improve coordination of regulatory resources and expertisebetween state insurance departments regarding the setting ofuniform standards and review of insurance products coveredunder the compact;
(6) create the interstate insurance product regulationcommission; and
(7) perform these and any other related functions as may beconsistent with the state regulation of the business of insurance.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-2
Definitions
Sec. 2. (a) The definitions in this section apply throughout thischapter.
(b) "Advertisement" means material designed to create publicinterest in a product or induce the public to purchase, increase,modify, reinstate, borrow on, surrender, replace, or retain a policy,as more specifically defined in the rules and operating procedures ofthe commission.
(c) "Bylaws" means bylaws established by the commission for thegovernance, direction, or control of the commission.
(d) "Commission" refers to the interstate insurance productregulation commission established by section 3 of this chapter.
(e) "Commissioner" means the chief insurance regulatory officialof a state, including a commissioner, a superintendent, a director, oran administrator.
(f) "Compacting state" means a state that:
(1) has enacted this compact; and
(2) has not:
(A) withdrawn as provided in section 15 of this chapter; or
(B) been terminated as provided in section 16 of this chapter. (g) "Domiciliary state" means the state in which an insurer isincorporated or organized, or the state of entry of an alien insurer.
(h) "Insurer" means an entity licensed by a state to issue contractsof insurance for the lines of insurance covered by this chapter.
(i) "Member" means the commissioner or the commissioner'sdesignee.
(j) "NAIC" refers to the National Association of InsuranceCommissioners.
(k) "Noncompacting state" means a state that is not a compactingstate.
(l) "Operating procedures" mean procedures adopted by thecommission to implement a rule, a uniform standard, or a provisionof this compact.
(m) "Opt out" means any action by a compacting state to declineto adopt or participate in a promulgated uniform standard.
(n) "Product" means the form of a policy or contract, including anapplication, an endorsement, or a related form that is attached to andmade a part of the policy or contract, and any evidence of coverageor certificate, for an individual or a group annuity, life insurance,disability income, or long term care insurance product that an insureris authorized to issue in Indiana or another compacting state.
(o) "Rule" means a statement of general or particular applicabilityand future effect adopted by the commission, including a uniformstandard developed under section 8 of this chapter, that has the fullforce and effect of law in the compacting states and:
(1) is designed to implement or interpret law or prescribepolicy; or
(2) describes the organization, procedure, or practicerequirements of the commission.
(p) "State" means a state, district, or territory of the United States.
(q) "Third party filer" means an entity that submits a productfiling to the commission on behalf of an insurer.
(r) "Uniform standard" means a standard adopted by thecommission for a product line under section 8 of this chapter. Theterm includes all the product requirements. However:
(1) each uniform standard shall be construed, whether expressor implied, to prohibit the use of any inconsistent, misleading,or ambiguous provisions in a product; and
(2) the form of the product made available to the public shallnot be unfair, inequitable, or against public policy asdetermined by the commission.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-3
Interstate insurance product regulation commission
Sec. 3. (a) The compacting states hereby establish a joint publicagency known as the interstate insurance product regulationcommission. Under section 4 of this chapter, the commission may:
(1) develop uniform standards for product lines;
(2) receive and provide prompt review of products filed with the
commission; and
(3) give approval to product filings satisfying applicableuniform standards.
However, it is not intended for the commission to be the exclusiveentity for receipt and review of insurance product filings. Thischapter does not prohibit an insurer from filing the insurer's productin a state where the insurer is licensed to conduct the business ofinsurance and any such filing is subject to the laws of the state wherefiled.
(b) The commission is a body corporate and politic, and aninstrumentality of the compacting states.
(c) The commission is solely responsible for the commission'sliabilities except as otherwise specifically provided in this compact.
(d) Venue is proper, and judicial proceedings by or against thecommission shall be brought solely and exclusively, in a court withjurisdiction where the principal office of the commission is located.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-4
Commission powers
Sec. 4. The commission has the following powers:
(1) To adopt rules under section 8 of this chapter, which shallhave the force and effect of law and are binding in thecompacting states to the extent and in the manner provided inthis compact.
(2) To exercise the commission's rulemaking authority andestablish reasonable uniform standards for products coveredunder the compact and advertisement related to the products,which shall have the force and effect of law and are binding inthe compacting states, but only for those products filed with thecommission. However, a compacting state has the right to optout of the uniform standard under section 8(d) of this chapter,to the extent and in the manner provided in this compact, andany uniform standard established by the commission for longterm care insurance products may provide the same or greaterprotections for consumers as, but shall not provide less than,those protections set forth in the NAIC's long term careinsurance model act and long term care insurance modelregulation, respectively, adopted as of 2001. The commissionshall consider whether any subsequent amendments to theNAIC long term care insurance model act or long term careinsurance model regulation adopted by the NAIC requireamending the uniform standards established by the commissionfor long term care insurance products.
(3) To receive and review in an expeditious manner productsfiled with the commission and rate filings for disability incomeand long term care insurance products, and give approval ofthose products and rate filings that satisfy the applicableuniform standard, where the approval shall have the force andeffect of law and is binding on the compacting states to the
extent and in the manner provided in the compact.
(4) To receive and review in an expeditious manneradvertisement relating to long term care insurance products forwhich uniform standards have been adopted by the commission,and give approval to all advertisement that satisfies theapplicable uniform standard. For any product covered under thiscompact, other than long term care insurance products, thecommission has authority to require an insurer to submit all orany part of the insurer's advertisement with respect to thatproduct for review or approval before use, if the commissiondetermines that the nature of the product is such that anadvertisement of the product could have the capacity ortendency to mislead the public. The actions of the commissionas provided in this section shall have the force and effect of lawand are binding in the compacting states to the extent and in themanner provided in the compact.
(5) To exercise the commission's rulemaking authority anddesignate products and advertisement that may be subject to aself-certification process without the need for prior approval bythe commission.
(6) To adopt operating procedures under section 8 of thischapter, which shall have the force and effect of law and arebinding in the compacting states to the extent and in the mannerprovided in this compact.
(7) To bring and prosecute legal proceedings or actions in thecommission's name as the commission, provided that thestanding of any state insurance department to sue or be suedunder applicable law shall not be affected.
(8) To issue subpoenas requiring the attendance and testimonyof witnesses and the production of evidence.
(9) To establish and maintain offices.
(10) To purchase and maintain insurance and bonds.
(11) To borrow, accept, or contract for services of personnel,including employees of a compacting state.
(12) To hire employees, professionals, or specialists, elect orappoint officers, and fix their compensation, define their duties,give them appropriate authority to carry out the purposes of thecompact, determine their qualifications, and establish thecommission's personnel policies and programs relating to,among other things, conflicts of interest, rates of compensation,and qualifications of personnel.
(13) To accept any and all appropriate donations and grants ofmoney, equipment, supplies, materials, and services, and toreceive, use, and dispose of the same. At all times thecommission shall strive to avoid any appearance of impropriety.
(14) To lease, purchase, accept appropriate gifts or donationsof, or otherwise to own, hold, improve, or use any property,real, personal, or mixed. At all times the commission shallstrive to avoid any appearance of impropriety.
(15) To sell, convey, mortgage, pledge, lease, exchange,
abandon, or otherwise dispose of any property, real, personal,or mixed.
(16) To remit filing fees to compacting states as may be setforth in the bylaws, rules, or operating procedures.
(17) To enforce compliance by compacting states with rules,uniform standards, operating procedures, and bylaws.
(18) To provide for dispute resolution among compacting states.
(19) To advise compacting states on issues relating to insurersdomiciled or doing business in noncompacting jurisdictions,consistent with the purposes of this compact.
(20) To provide advice and training to those personnel in stateinsurance departments responsible for product review, and to bea resource for state insurance departments.
(21) To establish a budget and make expenditures.
(22) To borrow money.
(23) To appoint committees, including advisory committees,comprising members, state insurance regulators, state legislatorsor their representatives, insurance industry and consumerrepresentatives, and any other interested persons as may bedesignated in the bylaws.
(24) To provide and receive information from and to cooperatewith law enforcement agencies.
(25) To adopt and use a corporate seal.
(26) To perform any other functions as may be necessary orappropriate to achieve the purposes of this compact consistentwith the state regulation of the business of insurance.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-5
Commission members; action; bylaws
Sec. 5. (a) Each compacting state shall have and be limited to one(1) member. Each member shall be qualified to serve in that capacityunder applicable law of the compacting state. Any member may beremoved or suspended from office as provided by the law of the statefrom which the member is appointed. Any vacancy occurring in thecommission shall be filled in accordance with the laws of thecompacting state where the vacancy exists. Nothing in this sectionshall be construed to affect the manner in which a compacting statedetermines the election or appointment and qualification of thecompacting state's commissioner.
(b) Each member is entitled to one (1) vote and is entitled to anopportunity to participate in the governance of the commission inaccordance with the bylaws. Notwithstanding any provision in thischapter to the contrary, no action of the commission with respect tothe promulgation of a uniform standard is effective unless two-thirds(2/3) of the members vote in favor of adoption.
(c) The commission shall, by a majority of the members, prescribebylaws to govern the commission's conduct as may be necessary orappropriate to carry out the purposes and exercise the powers of thecompact, including the following: (1) Establishing the fiscal year of the commission.
(2) Providing reasonable procedures for appointing and electingmembers and holding meetings of the management committee.
(3) Providing reasonable standards and procedures:
(A) for the establishment and meetings of other committees;and
(B) governing any general or specific delegation of anyauthority or function of the commission.
(4) Providing reasonable procedures for calling and conductingmeetings of the commission and ensuring reasonable advancenotice of each meeting, including:
(A) requiring a majority of commission members to attenda meeting;
(B) providing for the right of citizens to attend the meetingswith enumerated exceptions designed to:
(i) protect the public interest;
(ii) protect the privacy of individuals; and
(iii) insure proprietary information, including tradesecrets;
(C) allowing a meeting in camera only after a majority of themembers of the commission votes to close a meeting en totoor in part, with no proxy voting; and
(D) providing for the commission, as soon as practicableafter a vote to close a meeting as described in clause (C), tomake public:
(i) a copy of the vote to close the meeting revealing thevote of each member; and
(ii) votes taken during the meeting.
(5) Establishing the titles, duties, authority, and reasonableprocedures for the election of the officers of the commission.
(6) Providing reasonable standards and procedures for theestablishment of the personnel policies and programs of thecommission. Notwithstanding any civil service or other similarlaws of any compacting state, the bylaws shall exclusivelygovern the personnel policies and programs of the commission.
(7) Promulgating a code of ethics to address permissible andprohibited activities of commission members and employees.
(8) Providing a mechanism for winding up the operations of thecommission and the equitable disposition of any surplus fundsthat may exist after the termination of the compact after thepayment and reserving of all the commission's debts andobligations.
(d) The commission shall publish bylaws in a convenient formand file a copy of the bylaws and amendments to the bylaws with theappropriate agency or officer in each compacting state.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-6
Management committee; legislative committee; liability
Sec. 6. (a) A management committee comprising not more than
fourteen (14) members shall be established as follows:
(1) One (1) member from each of the six (6) compacting stateswith the largest premium volume for individual and groupannuities, life, disability income, and long term care insuranceproducts, determined from the records of the NAIC for the prioryear.
(2) Four (4) members from those compacting states with at leasttwo percent (2%) of the market based on the premium volumedescribed in subdivision (1), other than the six (6) compactingstates with the largest premium volume, selected on a rotatingbasis as provided in the bylaws.
(3) Four (4) members from those compacting states with lessthan two percent (2%) of the market, based on the premiumvolume described in subdivision (1), with one (1) selected fromeach of the four (4) zone regions of the NAIC as provided in thebylaws.
(b) The management committee has the authority and duties asmay be set forth in the bylaws, including the following:
(1) Managing the affairs of the commission in a mannerconsistent with the bylaws and purposes of the commission.
(2) Establishing and overseeing an organizational structurewithin, and appropriate procedures for, the commission toprovide for the creation of uniform standards and other rules,receipt and review of product filings, administrative andtechnical support functions, review of decisions regarding thedisapproval of a product filing, and the review of electionsmade by a compacting state to opt out of a uniform standard.However, a uniform standard shall not be submitted to thecompacting states for adoption unless approved by two-thirds(2/3) of the members of the management committee.
(3) Overseeing the offices of the commission.
(4) Planning, implementing, and coordinating communicationsand activities with other state, federal, and local governmentorganizations to advance the goals of the commission.
(c) The commission shall annually elect officers from themanagement committee, with each having the authority and duties asmay be specified in the bylaws.
(d) The management committee may, subject to the approval ofthe commission, appoint or retain an executive director for theperiod, upon the terms and conditions and for the compensation asthe commission considers appropriate. The executive director shallserve as secretary to the commission but may not be a member of thecommission. The executive director shall hire and supervise anyother staff as may be authorized by the commission.
(e) A legislative committee comprised of state legislators or statelegislators' designees shall be established to monitor the operationsof and make recommendations to the commission, including themanagement committee. However, the manner of selection and termof any legislative committee member shall be as set forth in thebylaws. Before the commission adopts any uniform standard,
revision to the bylaws, annual budget, or other significant matter asmay be provided in the bylaws, the management committee shallconsult with and report to the legislative committee. The commissionshall establish two (2) advisory committees, one (1) of which shallcomprise consumer representatives independent of the insuranceindustry and the other of which shall comprise insurance industryrepresentatives. The commission may establish additional advisorycommittees as the commission's bylaws may provide for the carryingout of the commission's functions.
(f) The commission shall maintain its corporate books and recordsin accordance with the bylaws.
(g) The members, officers, executive director, employees, andrepresentatives of the commission are immune from suit and liability,either personally or in their official capacity, for any claim fordamage to or loss of property or personal injury or other civilliability caused by or arising out of any actual or alleged act, error,or omission that occurred, or that the person against whom the claimis made had a reasonable basis for believing occurred, within thescope of commission employment, duties, or responsibilities.However, nothing in this subsection shall be construed to protect anyperson from suit or liability for any damage, loss, injury, or liabilitycaused by the intentional or willful and wanton misconduct of theperson.
(h) The commission shall defend any member, officer, executivedirector, employee, or representative of the commission in any civilaction seeking to impose liability arising out of any actual or allegedact, error, or omission that occurred within the scope of commissionemployment, duties, or responsibilities, or that the person againstwhom the claim is made had a reasonable basis for believingoccurred within the scope of commission employment, duties, orresponsibilities. However:
(1) nothing in this subsection shall be construed to prohibit thatperson from retaining the person's own counsel; and
(2) this subsection applies only if the actual or alleged act,error, or omission did not result from the person's intentional orwillful and wanton misconduct.
(i) The commission shall indemnify and hold harmless anymember, officer, executive director, employee, or representative ofthe commission for the amount of any settlement or judgmentobtained against the person arising out of any actual or alleged act,error, or omission that occurred within the scope of commissionemployment, duties, or responsibilities, or that the person had areasonable basis for believing occurred within the scope ofcommission employment, duties, or responsibilities. However, thissubsection applies only if the actual or alleged act, error, or omissiondid not result from the intentional or willful and wanton misconductof that person.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-7 Commission action
Sec. 7. (a) The commission shall meet and take any actions thatare consistent with this compact and the bylaws.
(b) Each member of the commission is entitled to cast a vote towhich that compacting state is entitled and to participate in thebusiness and affairs of the commission. A member shall vote inperson or by other means as provided in the bylaws. The bylaws mayprovide for members' participation in meetings by telephone or othermeans of communication.
(c) The commission shall meet at least one (1) time during eachcalendar year. Additional meetings shall be held as set forth in thebylaws.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-8
Rules; uniform standards; opting out; judicial review
Sec. 8. (a) The commission shall adopt reasonable rules, includinguniform standards, and operating procedures in order to effectivelyand efficiently achieve the purposes of this compact. However, if thecommission exercises the commission's rulemaking authority in amanner that is beyond the scope of the purposes of this chapter or thepowers granted in this chapter, the action by the commission isinvalid and has no force and effect.
(b) Rules and operating procedures shall be made according to arulemaking process that substantially conforms to the principles ofthe model state administrative procedure act of 1981, as amended, asmay be appropriate to the operations of the commission. Before thecommission adopts a uniform standard, the commission shall givewritten notice to the relevant state legislative committees in eachcompacting state responsible for insurance issues of thecommission's intention to adopt the uniform standard. Thecommission, in adopting a uniform standard, shall fully consider allsubmitted materials and issue a concise explanation of thecommission's decision.
(c) A uniform standard becomes effective ninety (90) days afterthe uniform standard's adoption by the commission or on a later dateas the commission may determine. However, a compacting state mayopt out of a uniform standard as provided in subsection (d). All otherrules and operating procedures and amendments to the other rulesand operating procedures become effective as of the date specifiedin each rule, operating procedure, or amendment.
(d) A compacting state may opt out of a uniform standard, eitherby legislation or by rule adopted by the insurance department underthe compacting state's administrative procedure act. If a compactingstate elects to opt out of a uniform standard by rule, the compactingstate must:
(1) give written notice to the commission not later than ten (10)business days after the uniform standard is adopted or at thetime the state becomes a compacting state; and
(2) find that the uniform standard does not provide reasonable
protections to the citizens of the state, given the conditions inthe state. The commissioner shall make specific findings of factand conclusions of law, based on a preponderance of theevidence, detailing the conditions in the state that warrant adeparture from the uniform standard and determining that theuniform standard would not reasonably protect the citizens ofthe state. The commissioner must balance, consider, and findthat the conditions in the state and needs of the citizens of thestate outweigh the following factors:
(A) The intent of the legislature to participate in, and thebenefits of, an interstate agreement to establish nationaluniform consumer protections for the products subject to thischapter.
(B) The presumption that a uniform standard adopted by thecommission provides reasonable protections to consumers ofthe relevant product.
However, a compacting state may, at the time of the compactingstate's enactment of this compact, prospectively opt out of alluniform standards involving long term care insurance products byexpressly providing for an opt out in the enacted compact, and theopt out shall not be treated as a material variance in the offer oracceptance of any state to participate in this compact. The opt out iseffective at the time of enactment of this compact by the compactingstate and shall apply to all existing uniform standards involving longterm care insurance products and those subsequently adopted.
(e) If a compacting state elects to opt out of a uniform standard,the uniform standard remains applicable in the compacting stateelecting to opt out until the time the opt out legislation is enacted orthe regulation opting out becomes effective. Once the opt out of auniform standard by a compacting state becomes effective asprovided under the laws of the state, the uniform standard shall haveno further force and effect in the state unless and until the legislationor regulation implementing the opt out is repealed or otherwisebecomes ineffective under the laws of the state. If a compacting stateopts out of a uniform standard after the uniform standard has beenmade effective in the state, the opt out shall have the sameprospective effect as provided under section 15 of this chapter forwithdrawals.
(f) If a compacting state has formally initiated the process ofopting out of a uniform standard by rule while the regulatory opt outis pending, the compacting state may petition the commission, notless than fifteen (15) days before the effective date of the uniformstandard, to stay the effectiveness of the uniform standard in thecompacting state. The commission may grant a stay if thecommission determines the regulatory opt out is being pursued in areasonable manner and there is a likelihood of success. If a stay isgranted or extended by the commission, the stay or extension maypostpone the effective date by not more than ninety (90) days, unlessthe stay is extended by the commission. However, a stay may not bepermitted to remain in effect for more than one (1) year unless the
compacting state can show extraordinary circumstances that warranta continuance of the stay, including the existence of a legal challengethat prevents the compacting state from opting out. A stay may beterminated by the commission on notice that the rulemaking processhas been terminated.
(g) Not later than thirty (30) days after a rule or operatingprocedure is adopted, any person may file a petition for judicialreview of the rule or operating procedure. However, the filing of apetition shall not stay or otherwise prevent the rule or operatingprocedure from becoming effective unless the court finds that thepetitioner has a substantial likelihood of success. The court shall givedeference to the actions of the commission consistent with applicablelaw and shall not find the rule or operating procedure to be unlawfulif the rule or operating procedure represents a reasonable exercise ofthe commission's authority.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-9
Commission information and records; disclosure; confidentiality;compacting state compliance and oversight
Sec. 9. (a) The commission shall adopt rules establishingconditions and procedures for public inspection and copying of thecommission's information and official records, except informationand records involving the privacy of individuals and trade secrets ofinsurers. The commission may adopt additional rules under whichthe commission may make available to federal and state agencies,including law enforcement agencies, records and informationotherwise exempt from disclosure, and may enter into agreementswith these agencies to receive or exchange information or recordssubject to nondisclosure and confidentiality provisions.
(b) Except as to privileged records, data, and information, thelaws of any compacting state pertaining to confidentiality ornondisclosure shall not relieve any compacting state commissionerof the duty to disclose any relevant records, data, or information tothe commission. However, disclosure to the commission shall not beconsidered to waive or otherwise affect any confidentialityrequirement, and, except as otherwise expressly provided in thischapter, the commission shall not be subject to the compacting state'slaws pertaining to confidentiality and nondisclosure with respect torecords, data, and information in the commission's possession.Confidential information of the commission remains confidentialafter the information is provided to any commissioner.
(c) The commission shall monitor compacting states forcompliance with duly adopted bylaws, rules, including uniformstandards, and operating procedures. The commission shall notifyany noncomplying compacting state in writing of the noncomplyingcompacting state's noncompliance with commission bylaws, rules, oroperating procedures. If a noncomplying compacting state fails toremedy the noncomplying compacting state's noncompliance withinthe time specified in the notice of noncompliance, the compacting
state is considered to be in default as set forth in section 16 of thischapter.
(d) The commissioner of any state in which an insurer isauthorized to do business or is conducting the business of insuranceshall continue to exercise the commissioner's authority to oversee themarket regulation of the activities of the insurer in accordance withthe provisions of the state's law. The commissioner's enforcement ofcompliance with the compact is governed by the following:
(1) With respect to the commissioner's market regulation of aproduct or an advertisement that is approved or certified to thecommission, the content of the product or advertisement doesnot constitute a violation of the provisions, standards, orrequirements of the compact except upon a final order of thecommission, issued at the request of a commissioner after priornotice to the insurer and an opportunity for hearing before thecommission.
(2) Before a commissioner may bring an action for violation ofa provision, standard, or requirement of the compact related tothe content of an advertisement not approved or certified to thecommission, the commission or an authorized commissionofficer or employee must authorize the action. However,authorization under this subdivision does not require:
(A) notice to the insurer;
(B) opportunity for hearing; or
(C) disclosure of:
(i) requests for authorization; or
(ii) records of the commission's action on a requestdescribed in item (i).
As added by P.L.138-2005, SEC.3.
IC 27-8-31-10
Dispute resolution
Sec. 10. The commission shall attempt, upon the request of amember, to resolve any disputes or other issues that are subject tothis compact and that may arise between two (2) or more compactingstates, or between compacting states and noncompacting states, andthe commission shall adopt an operating procedure providing forresolution of any disputes.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-11
Product filing and approval
Sec. 11. (a) Insurers and third party filers seeking to have aproduct approved by the commission shall file the product with andpay applicable filing fees to the commission. Nothing in this chapterrestricts or otherwise prevents an insurer from filing the insurer'sproduct with the insurance department in any state where the insureris licensed to conduct the business of insurance, and the filing issubject to the laws of the states where filed.
(b) The commission shall establish appropriate filing and review
processes and procedures under commission rules and operatingprocedures. Notwithstanding any provision in this chapter to thecontrary, the commission shall adopt rules to establish conditions andprocedures under which the commission will provide public accessto product filing information. In establishing any rules, thecommission shall consider the interests of the public in having accessto the information as well as protection of personal medical andfinancial information and trade secrets that may be contained in aproduct filing or supporting information.
(c) Any product approved by the commission may be sold orotherwise issued in the compacting states in which the insurer islegally authorized to do business.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-12
Disapproval; appeal; monitoring
Sec. 12. (a) Not later than thirty (30) days after the commissionhas given notice of a disapproved product or advertisement filed withthe commission, the insurer or third party filer whose filing wasdisapproved may appeal the determination to a review panelappointed by the commission. The commission shall adopt rules toestablish procedures for appointing the review panels and provide fornotice and hearing. An allegation that the commission, indisapproving a product or an advertisement filed with thecommission, acted arbitrarily, capriciously, or in a manner that is anabuse of discretion or otherwise not in accordance with the law, issubject to judicial review in accordance with section 3(e) of thischapter.
(b) The commission shall monitor, review, and reconsiderproducts and advertisement subsequent to their filing or approvalupon a finding that the product does not meet the relevant uniformstandard. If appropriate, the commission may withdraw or modify thecommission's approval after proper notice and hearing, subject to theappeal process in subsection (a).
As added by P.L.138-2005, SEC.3.
IC 27-8-31-13
Commission finances
Sec. 13. (a) The commission shall pay or provide for the paymentof the reasonable expenses of the commission's establishment andorganization. To fund the cost of the commission's initial operations,the commission may accept contributions and other forms of fundingfrom the NAIC, compacting states, and other sources. Contributionsand other forms of funding from other sources shall be of such anature that the independence of the commission concerning theperformance of the commission's duties is not compromised.
(b) The commission shall collect a filing fee from each insurerand third party filer filing a product with the commission to cover thecost of the operations and activities of the commission and thecommission's staff in an amount sufficient to cover the commission's
annual budget.
(c) The commission's budget for a fiscal year may not be approveduntil the commission's budget has been subject to notice andcomment as set forth in section 8(b) of this chapter.
(d) The commission is exempt from all taxation in and by thecompacting states.
(e) The commission shall not pledge the credit of any compactingstate, except by and with the appropriate legal authority of thatcompacting state.
(f) The commission shall keep complete and accurate accounts ofall the commission's internal receipts, including grants and donations,and disbursements of all funds under the commission's control. Theinternal financial accounts of the commission are subject to theaccounting procedures established under the commission's bylaws.The financial accounts and reports, including the system of internalcontrols and procedures of the commission, shall be audited annuallyby an independent certified public accountant. Upon thedetermination of the commission, but not less frequently than everythree (3) years, the review of the independent auditor shall includea management and performance audit of the commission. Thecommission shall make an annual report, to the governor andlegislature of the compacting states, including a report of theindependent audit. The commission's internal accounts are notconfidential and such internal account materials may be shared withthe commissioner of any compacting state upon request. However,work papers related to internal or independent audit and informationregarding the privacy of individuals and proprietary information ofinsurers, including trade secrets, is confidential.
(g) No compacting state shall have any claim to or ownership ofany property held by or vested in the commission or to anycommission funds held under the provisions of this compact.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-14
Effectiveness of compact; amendments
Sec. 14. (a) Any state is eligible to become a compacting state.The compact becomes effective and binding upon legislativeenactment of the compact into law by two (2) compacting states.However, the commission shall become effective for purposes ofadopting uniform standards for, reviewing, and giving approval ordisapproval of products filed with the commission that satisfyapplicable uniform standards only after twenty-six (26) states arecompacting states or, alternatively, by states representing greaterthan forty percent (40%) of the premium volume for life insurance,annuity, disability income, and long term care insurance products,based on records of the NAIC for the prior year. Thereafter, itbecomes effective and binding as to any other compacting state uponenactment of the compact into law by that state.
(b) Amendments to the compact may be proposed by thecommission for enactment by the compacting states. An amendment
does not become effective and binding upon the commission and thecompacting states unless and until all compacting states enact theamendment into law.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-15
Withdrawal of compacting state; reinstatement
Sec. 15. (a) Once effective, the compact continues in force andremains binding upon each compacting state. However, a compactingstate may withdraw from the compact by enacting a statutespecifically repealing the statute that enacted the compact into law.
(b) The effective date of withdrawal is the effective date of therepealing statute. However, the withdrawal does not apply to anyproduct filings approved or self-certified, or any advertisement ofproducts, on the date the repealing statute becomes effective, exceptby mutual agreement of the commission and the withdrawing state,unless the approval is rescinded by the withdrawing state as providedin subsection (e).
(c) The commissioner of the withdrawing state shall immediatelynotify the management committee in writing upon the introductionof legislation repealing this compact in the withdrawing state.
(d) The commission shall notify the other compacting states of theintroduction of the legislation within ten (10) days after thecommission's receipt of notice of the introduction of the legislation.
(e) The withdrawing state is responsible for all obligations, duties,and liabilities incurred through the effective date of withdrawal,including any obligations, the performance of which extend beyondthe effective date of withdrawal, except to the extent thoseobligations may have been released or relinquished by mutualagreement of the commission and the withdrawing state. Thecommission's approval of products and advertisement before theeffective date of withdrawal shall continue to be effective and begiven full force and effect in the withdrawing state, unless formallyrescinded by the withdrawing state in the same manner as providedby the laws of the withdrawing state for the prospective disapprovalof products or advertisement previously approved under state law.
(f) Reinstatement following withdrawal of any compacting stateoccurs on the effective date of the withdrawing state reenacting thecompact.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-16
Default of compacting state; reinstatement
Sec. 16. (a) If the commission determines that any compactingstate has at any time defaulted in the performance of any of thecompacting state's obligations or responsibilities under this compact,the bylaws, or adopted rules or operating procedures, after notice andhearing as set forth in the bylaws, all rights, privileges, and benefitsconferred by this compact on the defaulting state shall be suspendedfrom the effective date of default as fixed by the commission. The
grounds for default include:
(1) failure of a compacting state to perform its obligations orresponsibilities; or
(2) any other grounds designated in commission rules.
The commission shall immediately notify the defaulting state inwriting of the defaulting state's suspension pending a cure of thedefault. The commission shall stipulate the conditions and the periodwithin which the defaulting state must cure the defaulting state'sdefault. If the defaulting state fails to cure the default within theperiod specified by the commission, the defaulting state shall beterminated and the compact and all rights, privileges, and benefitsconferred by this compact shall be terminated on the effective dateof termination.
(b) Product approvals by the commission, productself-certifications, or any advertisement in connection with theproduct that is in force on the effective date of termination shallremain in force in the defaulting state in the same manner as if thedefaulting state had withdrawn voluntarily under section 15 of thischapter.
(c) Reinstatement following termination of any compacting staterequires a reenactment of the compact.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-17
Dissolution of compact
Sec. 17. The compact dissolves effective on the date of thewithdrawal or default of the compacting state that reducesmembership in the compact to one (1) compacting state. Upon thedissolution of this compact, the compact is null and void and is of nofurther force or effect, and the business and affairs of the commissionshall be wound up and any surplus funds shall be distributed inaccordance with the bylaws.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-18
Severability
Sec. 18. The provisions of this compact are severable and if anyphrase, clause, sentence, or provision is considered unenforceable,the remaining provisions of the compact are enforceable. Theprovisions of this compact shall be liberally construed to effectuatethe compact's purposes.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-19
Effect on state law
Sec. 19. (a) Nothing in this chapter prevents the enforcement ofany other law of a compacting state, except as provided in subsection(b).
(b) For a product approved or certified to the commission, therules, uniform standards, and any other requirements of the
commission constitute the exclusive provisions applicable to thecontent, approval, and certification of the products. For anadvertisement that is subject to the commission's authority, any rule,uniform standard, or other requirement of the commission thatgoverns the content of the advertisement constitutes the exclusiveprovision that a commissioner may apply to the content of theadvertisement. However, no action taken by the commission shallabrogate or restrict:
(1) the access of any person to state courts;
(2) remedies available under state law related to breach ofcontract, tort, or other laws not specifically directed to thecontent of the product;
(3) state law relating to the construction of insurance contracts;or
(4) the authority of the attorney general of the state, includingmaintaining actions or proceedings, as authorized by law.
(c) All insurance products filed with individual states are subjectto the laws of those states.
As added by P.L.138-2005, SEC.3.
IC 27-8-31-20
Commission actions and agreements; effect on compacting states;constitutional violation
Sec. 20. (a) All lawful actions of the commission, including allrules and operating procedures adopted by the commission, arebinding upon the compacting states.
(b) All agreements between the commission and the compactingstates are binding in accordance with the terms of the agreements.
(c) Upon the request of a party to a conflict over the meaning orinterpretation of commission actions and upon a majority vote of thecompacting states, the commission may issue advisory opinionsregarding the meaning or interpretation in dispute.
(d) Any provision of this compact that violates the Constitution ofthe State of Indiana is ineffective in Indiana.
As added by P.L.138-2005, SEC.3.