AN ACT TO PROVIDE FOR PRINCIPLE‑BASED VALUATION IN THE LIFE INSURANCE STANDARD VALUATION LAW AND STANDARD NONFORFEITURE PROVISIONS IN THE NORTH CAROLINA INSURANCE LAW; TO MAKE CONFORMING AND CLARIFYING CHANGES TO THE LAWS GOVERNING PROFESSIONAL EMPLOYER ORGANIZATIONS, INSURANCE COMPANY DEPOSITS, CONTINUING CARE RETIREMENT COMMUNITIES, HEALTH INSURANCE EXTERNAL REVIEW, AND INSURANCE COMPANY NAMES; TO REVISE INSURANCE POLICY RENEWAL PROVISIONS; TO AMEND THE DEFINITION OF SMALL EMPLOYER; AND TO MAKE TECHNICAL CORRECTIONS. Enacted October 22, 2015. Sections 1 and 2 of Part I are effective on the operative date of the manual of valuation instructions adopted by the National Association of Insurance Commissioners as provided in GS 58-58-51. Section 9 of Part II and Part IV are effective January 1, 2016. The remainder is effective October 22, 2015.
Summary date: Oct 29 2015 - View summary
Summary date: Sep 16 2015 - View summary
Senate committee substitute makes the following changes to the 1st edition.
Changes the short and long titles.
Amends GS 58-89A-60(d) to remove the requirement of a recent photograph from applications to the Commissioner of Insurance for professional employer services licensure.
Amends GS 58-5-55(a) to require domestic security deposits from nonstock insurance companies (current law refers only to stock insurance companies).
Amends GS 58-64-80 to update a reference to the North Carolina Association of Nonprofit Homes for the Aging with reference to LeadingAge North Carolina.
Amends GS 58-50-82 to require insurers in an expedited external review to provide requested information within one day (current law is one business day) after the Commissioner makes a request. This amendment become effective on January 1, 2016.
Amends GS 58-3-50, a requirement that companies do business in their own names, to allow for insurance policies issued by more than one company and to require clear identification of the company responsible for each coverage.
Creates new subsection in GS 58-41-20, imposing certain conditions on an insurer's refusal to renew a policy, to clarify that delivery of a policy superseding a previously issued policy is not a refusal to renew when it is delivered by specified entities.
Amends GS 58-50-110 to conform the definition of small employer to the definition under federal law, effective January 1, 2016.
Amends SL 2015-146 to clarify that all of Part I, making insurance holding company system regulatory act changes, is effective July 1, 2015. Makes Section 3, which concerns corporate governance requirements for risk retention groups, effective when the act becomes law.
Amends SL 2015-101 to make the following sections effective January 1, 2017, instead of when the act becomes law: (1) Section 4, amending GS 58-21-65; (2) Section 5, amending GS 58-21-70; and (3) Section 6, amending GS 58-21-85.
Makes organizational changes to the bill.
Summary date: Mar 26 2015 - View summary
Amends GS 58-58-50, Standard Valuation Law, as follows.
Sets out and defines terms for use in the statute. Provides that current language in the statute applies to policies and contracts issued before the operative date of the valuation manual. Amends that existing language to require the Commissioner of Insurance (Commissioner) to value the reserves for all outstanding life insurance policies, annuity contracts, pure endowment contracts, accident and health insurance contracts, and deposit-type contracts of every life insurance company doing business in the state. Deletes language allowing the Commissioner to certify the amount of the reserves. Specifies which existing statutory provisions apply to policies and contracts issued on or after the effective date of the statute and before the operative date of the valuation manual. Establishes new provisions that apply to all policies and contracts issued on or after the operative date of the valuation manual. Requires the Commissioner to annually value the reserves for all outstanding life insurance contracts, annuity contracts, pure endowment contracts, accident and health insurance contracts, and deposit‑type contracts of every company issued on or after the operative date of the valuation manual. Allows the Commissioner to accept a valuation made by the insurance supervisory official of any state or other jurisdiction in lieu of the valuation of the reserves required of a foreign or alien company, if that valuation complies with the minimum statutory standard.
Requires, on or after the operative date of the valuation manual, every company with outstanding life insurance contracts, annuity contracts, pure endowment contracts, accident and health insurance contracts, or deposit‑type contracts in this state subject to regulation by the Commissioner to annually submit the opinion of the appointed actuary as to whether the reserves and related actuarial items held in support of the policies and contracts are computed appropriately, are based on assumptions that satisfy contractual provisions, are consistent with previously reported amounts, and comply with applicable state laws. Also requires the inclusion of an opinion of the same appointed actuary as to whether the reserves and related actuarial items held in support of the policies and contracts specified in the valuation manual, when considered in light of the assets held by the company with respect to the reserves and related actuarial items, including, but not limited to, the investment earnings on the assets and the considerations anticipated to be received and retained under the policies and contracts, make adequate provision for the company's obligations under the policies and contracts. Sets out provisions governing the required opinions. Effective when the act becomes law, amends the provisions governing the opinions required in GS 58-58-50 for the time period before the operative date of the valuation manual.
Sets out provisions concerning the applicability of the valuation manual, including the items that must be specified in the manual. Specifies circumstances under which the Commissioner may exempt specific product forms or product lines of a licensed domestic company doing business only in this state from these requirements. Establishes requirements that apply to any principle-based valuation of policies issued on or after the operative date of the valuation manual, including requirements for the reserves.
Sets out 10 provisions governing the confidentiality of information provided to the Commissioner under the statute.
Gives the Department of Insurance full authority to enter into contracts or other agreements with the National Association of Insurance Commissioners, or any other state, entity, or person to fulfill the requirements of this statute and exempts those contracts from specified statutory provisions.
The above provisions are effective on the operative date of the manual of valuation instructions adopted by the National Association of Insurance Commissioners (NAIC).
Amends GS 58-58-55, standard nonforfeiture provisions, to make existing provisions applicable to policies issued before the operative date of the valuation manual and add new language governing policies issued on or after the operative date of the valuation manual. effective on the operative date of the manual of valuation instructions adopted by the NAIC.
Enacts new GS 58-58-51 setting the operative date of the valuation manual as January 1 of the first calendar year beginning the first July 1 as of which: (1) the valuation manual has been adopted by the NAIC by an affirmative vote of at least 42 members, or three‑fourths of the members voting, whichever is greater; (2) the model Standard Valuation Law, or legislation including substantially similar terms and provisions, has been enacted by states representing more than 75% of the direct premiums written as reported in the following annual statements submitted for 2008: life, accident and health annual statements; health annual statements; and fraternal annual statements; and (3) the model Standard Valuation Law has been enacted by at least 42 of the following 55 jurisdictions: the 50 states of the United States, American Samoa, the American Virgin Islands, the District of Columbia, Guam, and Puerto Rico.
Includes a severability clause.
Summary date: Mar 25 2015 - View summary
To be summarized.