S T A T E O F N E W Y O R K
________________________________________________________________________
3287
2015-2016 Regular Sessions
I N S E N A T E
February 4, 2015
___________
Introduced by Sen. SEWARD -- read twice and ordered printed, and when
printed to be committed to the Committee on Insurance
AN ACT to amend the insurance law, in relation to establishing the
interstate insurance product regulation compact to regulate certain
insurance products
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
1 Section 1. Legislative findings and intent. An interstate compact is
2 a contract between the states that allows them to cooperate on multi-
3 state or national issues while still retaining state control. Interstate
4 compacts are specifically mentioned in the U.S. Constitution and have
5 been historically used to address border disputes and water rights. The
6 use of interstate compacts has expanded significantly in recent decades
7 to cover tax, motor vehicle licensing, environmental, emergency manage-
8 ment and other issues. Over 200 interstate compacts currently exist, and
9 on average every state belongs to at least 25 compacts. The Interstate
10 Insurance Product Regulation Compact, which to date has been adopted by
11 44 member states, representing approximately two-thirds of the premium
12 volume in the nation, created the Interstate Insurance Product Regu-
13 lation Commission (IIPRC). The IIPRC provides the States with a vehicle
14 to (1) develop uniform national product standards that will afford a
15 high level of protection to consumers of life insurance, annuities,
16 disability income and long-term care insurance products; (2) establish a
17 central point of filing for these insurance products; and (3) thoroughly
18 review product filings and make regulatory decisions according to the
19 uniform product standards. The IIPRC is an important modernization
20 initiative that benefits state insurance regulators, consumers, and the
21 insurance industry. The Compact enhances the efficiency and effective-
22 ness of the way insurance products are filed, reviewed, and approved
23 allowing insurance customers to have faster access to competitive insur-
24 ance products in an ever-changing global marketplace. The Compact
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06596-03-5
S. 3287 2
1 promotes uniformity through application of uniform product standards
2 embedded with strong consumer protections. The state of New York seeks
3 to join with other states as a member of the Interstate Insurance Prod-
4 uct Regulation Compact and Commission.
5 S 2. The insurance law is amended by adding a new article 82 to read
6 as follows:
7 ARTICLE 82
8 INTERSTATE INSURANCE PRODUCT REGULATION COMPACT
9 SECTION 8201. SHORT TITLE.
10 8202. PURPOSE.
11 8203. DEFINITIONS.
12 8204. ESTABLISHMENT OF THE COMMISSION AND VENUE.
13 8205. POWERS OF THE COMMISSION.
14 8206. ORGANIZATION OF THE COMMISSION.
15 8207. MEETINGS AND ACTS OF THE COMMISSION.
16 8208. RULES AND OPERATING PROCEDURES; RULE MAKING FUNCTIONS OF
17 THE COMMISSION AND OPTING OUT OF UNIFORM STANDARDS.
18 8209. COMMISSION RECORDS AND ENFORCEMENT.
19 8210. DISPUTE RESOLUTION.
20 8211. PRODUCT FILING AND APPROVAL.
21 8212. REVIEW OF COMMISSION DECISIONS REGARDING FILINGS.
22 8213. FINANCE.
23 8214. COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT.
24 8215. WITHDRAWAL, DEFAULT AND TERMINATION.
25 8216. SEVERABILITY AND CONSTRUCTION.
26 8217. BINDING EFFECT OF COMPACT AND OTHER LAWS.
27 S 8201. SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
28 THE "INTERSTATE INSURANCE PRODUCT REGULATION COMPACT".
29 S 8202. PURPOSE. THE PURPOSES OF THIS COMPACT ARE, THROUGH MEANS OF
30 JOINT AND COOPERATIVE ACTION AMONG THE COMPACTING STATES:
31 (A) TO PROMOTE AND PROTECT THE INTEREST OF CONSUMERS OF INDIVIDUAL AND
32 GROUP ANNUITY, LIFE INSURANCE, DISABILITY INCOME AND LONG-TERM CARE
33 INSURANCE PRODUCTS;
34 (B) TO DEVELOP UNIFORM STANDARDS FOR PRODUCTS COVERED UNDER THE
35 COMPACT;
36 (C) TO ESTABLISH A CENTRAL CLEARINGHOUSE TO RECEIVE AND PROVIDE PROMPT
37 REVIEW OF PRODUCTS COVERED UNDER THE COMPACT AND, IN CERTAIN CASES,
38 ADVERTISEMENTS RELATED THERETO, SUBMITTED BY INSURERS AUTHORIZED TO DO
39 BUSINESS IN ONE OR MORE COMPACTING STATES;
40 (D) TO GIVE APPROPRIATE REGULATORY APPROVAL TO THOSE PRODUCT FILINGS
41 AND ADVERTISEMENTS SATISFYING THE APPLICABLE UNIFORM STANDARD;
42 (E) TO IMPROVE COORDINATION OF REGULATORY RESOURCES AND EXPERTISE
43 BETWEEN STATE INSURANCE DEPARTMENTS REGARDING THE SETTING OF UNIFORM
44 STANDARDS AND REVIEW OF INSURANCE PRODUCTS COVERED UNDER THE COMPACT;
45 (F) TO CREATE THE INTERSTATE INSURANCE PRODUCT REGULATION COMMISSION;
46 AND
47 (G) TO PERFORM SUCH OTHER RELATED FUNCTIONS AS MAY BE CONSISTENT WITH
48 THE STATE REGULATION OF THE BUSINESS OF INSURANCE.
49 S 8203. DEFINITIONS. AS USED IN THIS ARTICLE:
50 (A) "ADVERTISEMENT" MEANS ANY MATERIAL DESIGNED TO CREATE PUBLIC
51 INTEREST IN A PRODUCT, OR INDUCE THE PUBLIC TO PURCHASE, INCREASE, MODI-
52 FY, REINSTATE, BORROW ON, SURRENDER, REPLACE OR RETAIN A POLICY, AS MORE
53 SPECIFICALLY DEFINED IN THE RULES AND OPERATING PROCEDURES OF THE
54 COMMISSION.
S. 3287 3
1 (B) "BY-LAWS" MEAN THOSE BY-LAWS ESTABLISHED BY THE COMMISSION FOR ITS
2 GOVERNANCE OR FOR DIRECTING OR CONTROLLING THE COMMISSION'S ACTIONS OR
3 CONDUCT.
4 (C) "COMPACTING STATE" MEANS ANY STATE WHICH HAS ENACTED THIS COMPACT
5 LEGISLATION AND WHICH HAS NOT WITHDRAWN OR BEEN TERMINATED PURSUANT TO
6 SECTION EIGHT THOUSAND TWO HUNDRED FIFTEEN OF THIS ARTICLE.
7 (D) "COMMISSION" MEANS THE "INTERSTATE INSURANCE PRODUCT REGULATION
8 COMMISSION" ESTABLISHED BY THE COMPACT.
9 (E) "COMMISSIONER" MEANS THE CHIEF INSURANCE REGULATORY OFFICIAL OF A
10 STATE INCLUDING, BUT NOT LIMITED TO COMMISSIONER, SUPERINTENDENT, DIREC-
11 TOR OR ADMINISTRATOR.
12 (F) "DOMICILIARY STATE" MEANS THE STATE IN WHICH AN INSURER IS INCOR-
13 PORATED OR ORGANIZED OR, IN THE CASE OF AN ALIEN INSURER, ITS STATE OF
14 ENTRY.
15 (G) "INSURER" MEANS ANY ENTITY LICENSED BY A STATE TO ISSUE CONTRACTS
16 OF INSURANCE FOR ANY OF THE LINES OF INSURANCE COVERED BY THIS ARTICLE.
17 (H) "MEMBER" MEANS THE PERSON, OR HIS OR HER DESIGNEE, CHOSEN BY A
18 COMPACTING STATE FOR SERVICE ON THE COMMISSION.
19 (I) "NON-COMPACTING STATE" MEANS ANY STATE WHICH IS NOT AT THE TIME A
20 COMPACTING STATE.
21 (J) "OPERATING PROCEDURES" MEAN PROCEDURES PROMULGATED BY THE COMMIS-
22 SION IMPLEMENTING A RULE, UNIFORM STANDARD OR A PROVISION OF THIS
23 COMPACT.
24 (K) "PRODUCT" MEANS THE FORM OF THE CONTRACT, POLICY APPLICATION,
25 ENDORSEMENTS, CERTIFICATE FORMS, EVIDENCE OF COVERAGE FORMS AND RELATED
26 FORMS FOR AN INDIVIDUAL OR GROUP ANNUITY, LIFE INSURANCE, DISABILITY
27 INCOME OR LONG-TERM CARE INSURANCE PRODUCT, WHICH AN INSURER IS AUTHOR-
28 IZED TO ISSUE.
29 (L) "RULE" MEANS A STATEMENT OF GENERAL OR PARTICULAR APPLICABILITY
30 AND FUTURE EFFECT PROMULGATED BY THE COMMISSION, INCLUDING A UNIFORM
31 STANDARD DEVELOPED PURSUANT TO SECTION EIGHT THOUSAND TWO HUNDRED EIGHT
32 OF THIS ARTICLE, DESIGNED TO IMPLEMENT, INTERPRET, OR PRESCRIBE LAW OR
33 POLICY OR DESCRIBING THE ORGANIZATION, PROCEDURE, OR PRACTICE REQUIRE-
34 MENTS OF THE COMMISSION, WHICH SHALL HAVE THE FORCE AND EFFECT OF LAW IN
35 THE COMPACTING STATES.
36 (M) "STATE" MEANS ANY STATE, DISTRICT OR TERRITORY OF THE UNITED
37 STATES OF AMERICA.
38 (N) "THIRD-PARTY FILER" MEANS AN ENTITY THAT SUBMITS A PRODUCT FILING
39 TO THE COMMISSION ON BEHALF OF AN INSURER.
40 (O) "UNIFORM STANDARD" MEANS A STANDARD ADOPTED BY THE COMMISSION FOR
41 A PRODUCT LINE, PURSUANT TO SECTION EIGHT THOUSAND TWO HUNDRED EIGHT OF
42 THIS ARTICLE AND SHALL INCLUDE ALL OF THE PRODUCT REQUIREMENTS IN AGGRE-
43 GATE; PROVIDED, THAT EACH UNIFORM STANDARD SHALL BE CONSTRUED, WHETHER
44 EXPRESS OR IMPLIED, TO PROHIBIT THE USE OF ANY INCONSISTENT, MISLEADING
45 OR AMBIGUOUS PROVISIONS IN A PRODUCT AND THE FORM OF SUCH PRODUCT MADE
46 AVAILABLE TO THE PUBLIC SHALL NOT BE UNFAIR, INEQUITABLE OR AGAINST
47 PUBLIC POLICY AS DETERMINED BY THE COMMISSION.
48 S 8204. ESTABLISHMENT OF THE COMMISSION AND VENUE. (A) THE COMPACTING
49 STATES HEREBY ESTABLISH A JOINT PUBLIC AGENCY KNOWN AS THE "INTERSTATE
50 INSURANCE PRODUCT REGULATION COMMISSION". PURSUANT TO SECTION EIGHT
51 THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE, THE COMMISSION SHALL HAVE
52 THE POWER TO DEVELOP UNIFORM STANDARDS FOR PRODUCT LINES, RECEIVE AND
53 PROVIDE PROMPT REVIEW OF PRODUCTS FILED THEREWITH, AND GIVE APPROVAL TO
54 THOSE PRODUCT FILINGS SATISFYING APPLICABLE UNIFORM STANDARDS; PROVIDED,
55 HOWEVER, THAT IT IS NOT INTENDED FOR THE COMMISSION TO BE THE EXCLUSIVE
56 ENTITY FOR RECEIPT AND REVIEW OF INSURANCE PRODUCT FILINGS. NOTHING IN
S. 3287 4
1 THIS SECTION SHALL PROHIBIT ANY INSURER FROM FILING ITS PRODUCT IN ANY
2 STATE WHEREIN SUCH INSURER IS LICENSED TO CONDUCT THE BUSINESS OF INSUR-
3 ANCE AND SUCH FILING SHALL BE SUBJECT TO THE LAWS OF THE STATE WHERE
4 FILED.
5 (B) THE COMMISSION IS A BODY CORPORATE AND POLITIC, AND AN INSTRUMEN-
6 TALITY OF THE COMPACTING STATES.
7 (C) THE COMMISSION IS A NOT-FOR-PROFIT ENTITY, SEPARATE AND DISTINCT
8 FROM THE INDIVIDUAL COMPACTING STATES.
9 (D) THE COMMISSION IS SOLELY RESPONSIBLE FOR ITS LIABILITIES UNLESS
10 OTHERWISE SPECIFICALLY PROVIDED IN THIS COMPACT, EXCEPT THAT, IN NO
11 EVENT SHALL THE OBLIGATIONS OF THE COMMISSION BE THE DEBT OF THE STATE
12 OF NEW YORK NOR SHALL ANY REVENUES OR PROPERTY OF THE STATE OF NEW YORK
13 BE LIABLE THEREFOR.
14 (E) VENUE IN PROPER AND JUDICIAL PROCEEDINGS BY OR AGAINST THE COMMIS-
15 SION SHALL BE BROUGHT SOLELY AND EXCLUSIVELY IN A COURT OF COMPETENT
16 JURISDICTION WHERE THE PRINCIPAL OFFICE OF THE COMMISSION IS LOCATED.
17 S 8205. POWERS OF THE COMMISSION. (A) THE COMMISSION SHALL HAVE THE
18 FOLLOWING POWERS:
19 (1) TO PROMULGATE RULES, PURSUANT TO SECTION EIGHT THOUSAND TWO
20 HUNDRED EIGHT OF THIS ARTICLE, WHICH SHALL HAVE THE FORCE AND EFFECT OF
21 LAW AND SHALL BE BINDING IN THE COMPACTING STATES TO THE EXTENT AND IN
22 THE MANNER PROVIDED IN THIS ARTICLE;
23 (2) TO EXERCISE ITS RULE MAKING AUTHORITY AND ESTABLISH REASONABLE
24 UNIFORM STANDARDS FOR PRODUCTS COVERED UNDER THE COMPACT, AND ADVERTISE-
25 MENT RELATED THERETO, WHICH SHALL HAVE THE FORCE AND EFFECT OF LAW AND
26 SHALL BE BINDING IN THE COMPACTING STATES, BUT ONLY FOR SUCH PRODUCTS
27 FILED WITH THE COMMISSION; PROVIDED, HOWEVER, THAT A COMPACTING STATE
28 SHALL HAVE THE RIGHT TO OPT OUT OF SUCH UNIFORM STANDARD PURSUANT TO
29 SECTION EIGHT THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE TO THE EXTENT
30 AND IN THE MANNER PROVIDED IN THIS ARTICLE, AND PROVIDED FURTHER THAT
31 ANY UNIFORM STANDARD ESTABLISHED BY THE COMMISSIONER FOR LONG-TERM CARE
32 INSURANCE PRODUCTS MAY PROVIDE THE SAME OR GREATER PROTECTIONS FOR
33 CONSUMERS AS, BUT SHALL NOT PROVIDE LESS THAN, THOSE PROTECTIONS SET
34 FORTH IN THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS' (HEREIN-
35 AFTER REFERRED TO AS THE "NAIC") LONG-TERM CARE INSURANCE MODEL ACT AND
36 LONG-TERM CARE INSURANCE MODEL REGULATION, RESPECTIVELY, ADOPTED AS OF
37 2001. THE COMMISSION SHALL CONSIDER WHETHER ANY SUBSEQUENT AMENDMENTS TO
38 THE NAIC LONG-TERM CARE INSURANCE MODEL ACT OR LONG-TERM CARE INSURANCE
39 MODEL REGULATION ADOPTED BY THE NAIC REQUIRE AMENDING OF THE UNIFORM
40 STANDARDS ESTABLISHED BY THE COMMISSION FOR LONG-TERM INSURANCE
41 PRODUCTS;
42 (3) TO RECEIVE AND REVIEW IN AN EXPEDITIOUS MANNER PRODUCTS FILED WITH
43 THE COMMISSION, INCLUDING RATE FILINGS FOR DISABILITY INCOME AND
44 LONG-TERM CARE INSURANCE PRODUCTS, AND GIVE APPROVAL OF THOSE PRODUCTS
45 AND RATE FILINGS THAT SATISFY THE APPLICABLE UNIFORM STANDARD, WHERE
46 SUCH APPROVAL SHALL HAVE THE FORCE AND EFFECT OF LAW AND BE BINDING ON
47 THE COMPACTING STATES TO THE EXTENT AND IN THE MANNER PROVIDED IN THE
48 COMPACT;
49 (4) TO RECEIVE AND REVIEW IN AN EXPEDITIOUS MANNER ADVERTISEMENT
50 RELATING TO LONG-TERM CARE INSURANCE PRODUCTS FOR WHICH UNIFORM STAND-
51 ARDS HAVE BEEN ADOPTED BY THE COMMISSION, AND GIVE APPROVAL OF SUCH
52 ADVERTISEMENT THAT SATISFIES THE APPLICABLE UNIFORM STANDARD. FOR ANY
53 PRODUCT COVERED UNDER THIS ARTICLE, OTHER THAN LONG-TERM CARE INSURANCE
54 PRODUCTS, THE COMMISSION SHALL HAVE THE AUTHORITY TO REQUIRE AN INSURER
55 TO SUBMIT ALL OR ANY PART OF ITS ADVERTISEMENT WITH RESPECT TO THAT
56 PRODUCT FOR REVIEW OR APPROVAL PRIOR TO USE IF THE COMMISSION DETERMINES
S. 3287 5
1 THAT THE NATURE OF THE PRODUCT IS SUCH THAT AN ADVERTISEMENT OF THE
2 PRODUCT COULD HAVE THE CAPACITY OR TENDENCY TO MISLEAD THE PUBLIC. THE
3 ACTIONS OF THE COMMISSION AS PROVIDED IN THIS SECTION SHALL HAVE THE
4 FORCE AND EFFECT OF LAW AND SHALL BE BINDING IN THE COMPACTING STATES TO
5 THE EXTENT AND IN THE MANNER PROVIDED IN THE COMPACT;
6 (5) TO EXERCISE RULE MAKING AUTHORITY AND DESIGNATE PRODUCTS AND
7 ADVERTISEMENT THAT MAY BE SUBJECT TO A SELF-CERTIFICATION PROCESS WITH-
8 OUT THE NEED FOR PRIOR APPROVAL BY THE COMMISSION;
9 (6) TO PROMULGATE OPERATING PROCEDURES, PURSUANT TO SECTION EIGHT
10 THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE, WHICH SHALL BE BINDING IN
11 THE COMPACTING STATES TO THE EXTENT AND IN THE MANNER PROVIDED IN THE
12 COMPACT;
13 (7) TO BRING AND PROSECUTE LEGAL PROCEEDINGS OR ACTIONS IN ITS NAME AS
14 THE COMMISSION; PROVIDED, THAT THE STANDING OF ANY STATE INSURANCE
15 DEPARTMENT TO SUE OR BE SUED UNDER APPLICABLE LAW SHALL NOT BE AFFECTED;
16 (8) TO ISSUE SUBPOENAS REQUIRING THE ATTENDANCE AND TESTIMONY OF
17 WITNESSES AND THE PRODUCTION OF EVIDENCE;
18 (9) TO ESTABLISH AND MAINTAIN OFFICES;
19 (10) TO PURCHASE AND MAINTAIN INSURANCE AND BONDS;
20 (11) TO BORROW, ACCEPT OR CONTRACT FOR SERVICES OF PERSONNEL, INCLUD-
21 ING, BUT NOT LIMITED TO, EMPLOYEES OF A COMPACTING STATE;
22 (12) TO HIRE EMPLOYEES AND ELECT OR APPOINT OFFICERS, AND TO FIX THEIR
23 COMPENSATION, DEFINE THEIR DUTIES AND GIVE THEM APPROPRIATE AUTHORITY TO
24 CARRY OUT THE PURPOSES OF THE COMPACT, AND DETERMINE THEIR QUALIFICA-
25 TIONS; AND TO ESTABLISH THE COMMISSION'S PERSONNEL POLICIES AND PROGRAMS
26 RELATING TO, AMONG OTHER THINGS, CONFLICTS OF INTEREST, RATES OF COMPEN-
27 SATION AND QUALIFICATIONS OF PERSONNEL;
28 (13) TO ACCEPT ANY AND ALL APPROPRIATE DONATIONS AND GRANTS OF MONEY,
29 EQUIPMENT, SUPPLIES, MATERIALS AND SERVICES, AND TO RECEIVE, UTILIZE AND
30 DISPOSE OF THE SAME; PROVIDED THAT AT ALL TIMES THE COMMISSION SHALL
31 STRIVE TO AVOID ANY APPEARANCE OF IMPROPRIETY;
32 (14) TO LEASE, PURCHASE, ACCEPT APPROPRIATE GIFTS OR DONATIONS OF, OR
33 OTHERWISE TO OWN, HOLD, IMPROVE OR USE, ANY PROPERTY, REAL, PERSONAL OR
34 MIXED; PROVIDED THAT AT ALL TIMES THE COMMISSION SHALL STRIVE TO AVOID
35 ANY APPEARANCE OF IMPROPRIETY;
36 (15) TO SELL, CONVEY, MORTGAGE, PLEDGE, LEASE, EXCHANGE, ABANDON OR
37 OTHERWISE DISPOSE OF ANY PROPERTY, REAL, PERSONAL OR MIXED;
38 (16) TO REMIT FILING FEES TO COMPACTING STATES AS MAY BE SET FORTH IN
39 THE BY-LAWS, RULES OR OPERATING PROCEDURES;
40 (17) TO ENFORCE COMPLIANCE BY COMPACTING STATES WITH RULES, UNIFORM
41 STANDARDS, OPERATING PROCEDURES AND BY-LAWS;
42 (18) TO PROVIDE FOR DISPUTE RESOLUTION AMONG COMPACTING STATES;
43 (19) TO ADVISE COMPACTING STATES ON ISSUES RELATING TO INSURERS DOMI-
44 CILED OR DOING BUSINESS IN NON-COMPACTING JURISDICTIONS, CONSISTENT WITH
45 THE PURPOSES OF THE COMPACT;
46 (20) TO PROVIDE ADVICE AND TRAINING TO THOSE PERSONNEL IN STATE INSUR-
47 ANCE DEPARTMENTS RESPONSIBLE FOR PRODUCT REVIEW, AND TO BE A RESOURCE
48 FOR STATE INSURANCE DEPARTMENTS;
49 (21) TO ESTABLISH A BUDGET AND MAKE EXPENDITURES;
50 (22) TO BORROW MONEY;
51 (23) TO APPOINT COMMITTEES, INCLUDING ADVISORY COMMITTEES COMPRISING
52 MEMBERS, STATE INSURANCE REGULATORS, STATE LEGISLATORS OR THEIR REPRE-
53 SENTATIVES, INSURANCE INDUSTRY AND CONSUMER REPRESENTATIVES, AND SUCH
54 OTHER INTERESTED PERSONS AS MAY BE DESIGNATED IN THE BY-LAWS;
55 (24) TO PROVIDE AND RECEIVE INFORMATION FROM, AND TO COOPERATE WITH
56 LAW ENFORCEMENT AGENCIES;
S. 3287 6
1 (25) TO ADOPT AND USE A CORPORATE SEAL; AND
2 (26) TO PERFORM SUCH OTHER FUNCTIONS AS MAY BE NECESSARY OR APPROPRI-
3 ATE TO ACHIEVE THE PURPOSES OF THIS COMPACT CONSISTENT WITH THE STATE
4 REGULATION OF THE BUSINESS OF INSURANCE.
5 (B) ALL DONATIONS, GRANTS OF MONEY, EQUIPMENT, SUPPLIES, MATERIALS OR
6 SERVICES, PURCHASES, GIFTS, DONATIONS, CONVEYANCES, MORTGAGES, PLEDGES,
7 LEASES AND EXCHANGES, AS AUTHORIZED BY SUBSECTION (A) OF THIS SECTION,
8 RECEIVED BY OR ON BEHALF OF THE COMMISSION SHALL BE LIMITED TO THE
9 DIRECT FUNDING OF THE LAWFUL AND AUTHORIZED OPERATIONS OF THE COMMIS-
10 SION.
11 S 8206. ORGANIZATION OF THE COMMISSION. (A) EACH COMPACTING STATE
12 SHALL HAVE AND BE LIMITED TO ONE MEMBER. THE SUPERINTENDENT, OR HIS OR
13 HER DESIGNATED REPRESENTATIVE, SHALL BE NEW YORK'S MEMBER OF SUCH
14 COMMISSION. EACH MEMBER SHALL BE QUALIFIED TO SERVE IN SUCH CAPACITY
15 PURSUANT TO APPLICABLE LAW OF THE COMPACTING STATE. ANY MEMBER MAY BE
16 REMOVED OR SUSPENDED FROM OFFICE AS PROVIDED BY THE LAW OF THE STATE
17 FROM WHICH HE OR SHE SHALL BE APPOINTED. ANY VACANCY OCCURRING IN THE
18 COMMISSION SHALL BE FILLED IN ACCORDANCE WITH THE LAWS OF THE COMPACTING
19 STATE WHEREIN SUCH VACANCY EXISTS. NOTHING HEREIN SHALL BE CONSTRUED TO
20 AFFECT THE MANNER IN WHICH A COMPACTING STATE DETERMINES THE ELECTION OR
21 APPOINTMENT AND QUALIFICATION OF ITS OWN SUPERINTENDENT.
22 (B) EACH MEMBER SHALL BE ENTITLED TO ONE VOTE AND SHALL HAVE AN OPPOR-
23 TUNITY TO PARTICIPATE IN THE GOVERNANCE OF THE COMMISSION IN ACCORDANCE
24 WITH THE BY-LAWS. NOTWITHSTANDING ANY PROVISION OF THIS ARTICLE TO THE
25 CONTRARY, NO ACTION OF THE COMMISSION WITH RESPECT TO THE PROMULGATION
26 OF A UNIFORM STANDARD SHALL BE EFFECTIVE UNLESS TWO-THIRDS OF THE
27 MEMBERS VOTE IN FAVOR THEREOF.
28 (C) THE COMMISSION SHALL, BY A MAJORITY OF THE MEMBERS, PRESCRIBE
29 BY-LAWS TO GOVERN ITS CONDUCT AS MAY BE NECESSARY OR APPROPRIATE TO
30 CARRY OUT THE PURPOSES, AND EXERCISE THE POWERS, OF THE COMPACT, INCLUD-
31 ING, BUT NOT LIMITED TO:
32 (1) ESTABLISHING THE FISCAL YEAR OF THE COMMISSION;
33 (2) PROVIDING REASONABLE PROCEDURES FOR HOLDING MEETINGS OF THE
34 MANAGEMENT COMMITTEE;
35 (3) PROVIDING REASONABLE STANDARDS AND PROCEDURES FOR THE ESTABLISH-
36 MENT OF OTHER COMMITTEES, AND GOVERNING ANY GENERAL OR SPECIFIC DELEG-
37 ATION OF ANY AUTHORITY OR FUNCTION OF THE COMMISSION;
38 (4) PROVIDING REASONABLE PROCEDURES FOR CALLING AND CONDUCTING MEET-
39 INGS OF THE COMMISSION THAT CONSIST OF A MAJORITY OF COMMISSION MEMBERS,
40 ENSURING REASONABLE ADVANCE NOTICE OF EACH SUCH MEETING, AND PROVIDING
41 FOR THE RIGHT OF CITIZENS TO ATTEND EACH SUCH MEETING WITH ENUMERATED
42 EXCEPTIONS DESIGNED TO PROTECT THE PUBLIC'S INTEREST, THE PRIVACY OF
43 INDIVIDUALS AND INSURERS' PROPRIETARY INFORMATION, INCLUDING TRADE
44 SECRETS. THE COMMISSION MAY MEET IN CAMERA ONLY AFTER A MAJORITY OF THE
45 ENTIRE MEMBERSHIP VOTES TO CLOSE A MEETING IN TOTO OR IN PART. AS SOON
46 AS PRACTICABLE, THE COMMISSION MUST MAKE PUBLIC A COPY OF THE VOTE TO
47 CLOSE THE MEETING REVEALING THE VOTE OF EACH MEMBER WITH NO PROXY VOTES
48 ALLOWED, AND VOTES TAKEN DURING SUCH MEETING;
49 (5) ESTABLISHING THE TITLES, DUTIES AND AUTHORITY AND REASONABLE
50 PROCEDURES FOR THE ELECTION OF THE OFFICERS OF THE COMMISSION;
51 (6) PROVIDING REASONABLE STANDARDS AND PROCEDURES FOR THE ESTABLISH-
52 MENT OF THE PERSONNEL POLICIES AND PROGRAMS OF THE COMMISSION. NOTWITH-
53 STANDING ANY CIVIL SERVICE OR OTHER SIMILAR LAWS OF ANY COMPACTING
54 STATE, THE BY-LAWS SHALL EXCLUSIVELY GOVERN THE PERSONNEL POLICIES AND
55 PROGRAMS OF THE COMMISSION;
S. 3287 7
1 (7) PROMULGATING A CODE OF ETHICS TO ADDRESS PERMISSIBLE AND PROHIBIT-
2 ED ACTIVITIES OF COMMISSION MEMBERS AND EMPLOYEES; AND
3 (8) PROVIDING A MECHANISM FOR WINDING UP THE OPERATIONS OF THE COMMIS-
4 SION AND THE EQUITABLE DISPOSITION OF ANY SURPLUS FUNDS THAT MAY EXIST
5 AFTER THE TERMINATION OF THE COMPACT AFTER THE PAYMENT AND/OR RESERVING
6 OF ALL OF ITS DEBTS AND OBLIGATIONS.
7 (D) THE COMMISSION SHALL PUBLISH ITS BY-LAWS IN A CONVENIENT FORM AND
8 FILE A COPY THEREOF AND A COPY OF ANY AMENDMENT THERETO, WITH THE APPRO-
9 PRIATE AGENCY OR OFFICER IN EACH OF THE COMPACTING STATES.
10 (E) A MANAGEMENT COMMITTEE COMPRISING NO MORE THAN FOURTEEN MEMBERS
11 SHALL BE ESTABLISHED AS FOLLOWS:
12 (1) ONE MEMBER FROM EACH OF THE SIX COMPACTING STATES WITH THE LARGEST
13 PREMIUM VOLUME FOR INDIVIDUAL AND GROUP ANNUITIES, LIFE, DISABILITY
14 INCOME AND LONG-TERM CARE INSURANCE PRODUCTS, DETERMINED FROM THE
15 RECORDS OF THE NAIC AS OF DECEMBER THIRTY-FIRST OF THE PRIOR YEAR;
16 (2) FOUR MEMBERS FROM THOSE COMPACTING STATES WITH AT LEAST TWO
17 PERCENT OF THE MARKET BASED ON THE PREMIUM VOLUME DESCRIBED IN PARAGRAPH
18 ONE OF THIS SUBSECTION, OTHER THAN SIX COMPACTING STATES WITH THE LARG-
19 EST PREMIUM VOLUME, SELECTED ON A ROTATING BASIS AS PROVIDED IN THE
20 BY-LAWS; AND
21 (3) FOUR MEMBERS FROM THOSE COMPACTING STATES WITH LESS THAN TWO
22 PERCENT OF THE MARKET, BASED ON THE PREMIUM VOLUME DESCRIBED IN PARA-
23 GRAPH ONE OF THIS SUBSECTION, WITH ONE SELECTED FROM EACH OF THE FOUR
24 ZONE REGIONS OF THE NAIC AS PROVIDED IN THE BY-LAWS.
25 (F) THE MANAGEMENT COMMITTEE SHALL HAVE SUCH AUTHORITY AND DUTIES AS
26 MAY BE SET FORTH IN THE BY-LAWS, INCLUDING BUT NOT LIMITED TO:
27 (1) MANAGING THE AFFAIRS OF THE COMMISSION IN A MANNER CONSISTENT WITH
28 THE BY-LAWS AND PURPOSES OF THE COMMISSION;
29 (2) ESTABLISHING AND OVERSEEING AN ORGANIZATIONAL STRUCTURE WITHIN,
30 AND APPROPRIATE PROCEDURES FOR, THE COMMISSION TO PROVIDE FOR THE
31 CREATION OF UNIFORM STANDARDS AND OTHER RULES, RECEIPT AND REVIEW OF
32 PRODUCT FILINGS, ADMINISTRATIVE AND TECHNICAL SUPPORT FUNCTIONS, REVIEW
33 OF DECISIONS REGARDING THE DISAPPROVAL OF A PRODUCT FILING, AND THE
34 REVIEW OF ELECTIONS MADE BY A COMPACTING STATE TO OPT OUT OF A UNIFORM
35 STANDARD; PROVIDED THAT A UNIFORM STANDARD SHALL NOT BE SUBMITTED TO THE
36 COMPACTING STATES FOR ADOPTION UNLESS APPROVED BY TWO-THIRDS OF THE
37 MEMBERS OF THE MANAGEMENT COMMITTEE;
38 (3) OVERSEEING THE OFFICES OF THE COMMISSION; AND
39 (4) PLANNING, IMPLEMENTING, AND COORDINATING COMMUNICATIONS AND ACTIV-
40 ITIES WITH OTHER STATE, FEDERAL AND LOCAL GOVERNMENT ORGANIZATIONS IN
41 ORDER TO ADVANCE THE GOALS OF THE COMMISSION.
42 (G) THE COMMISSION SHALL ELECT ANNUALLY OFFICERS FROM THE MANAGEMENT
43 COMMITTEE, WITH EACH HAVING SUCH AUTHORITY AND DUTIES, AS MAY BE SPECI-
44 FIED IN THE BY-LAWS.
45 (H) THE MANAGEMENT COMMITTEE MAY, SUBJECT TO THE APPROVAL OF THE
46 COMMISSION, APPOINT OR RETAIN AN EXECUTIVE DIRECTOR FOR SUCH PERIOD,
47 UPON SUCH TERMS AND CONDITIONS AND FOR SUCH COMPENSATION AS THE COMMIS-
48 SION MAY DEEM APPROPRIATE. THE EXECUTIVE DIRECTOR SHALL SERVE AS SECRE-
49 TARY TO THE COMMISSION, BUT SHALL NOT BE A MEMBER OF THE COMMISSION. THE
50 EXECUTIVE DIRECTOR SHALL HIRE AND SUPERVISE SUCH OTHER STAFF AS MAY BE
51 AUTHORIZED BY THE COMMISSION.
52 (I) A LEGISLATIVE COMMITTEE COMPRISING STATE LEGISLATORS OR THEIR
53 DESIGNEES SHALL BE ESTABLISHED TO MONITOR THE OPERATIONS OF, AND MAKE
54 RECOMMENDATIONS TO, THE COMMISSION; PROVIDED THAT THE MANNER OF
55 SELECTION AND TERM OF ANY LEGISLATIVE COMMITTEE MEMBER SHALL BE AS SET
56 FORTH IN THE BY-LAWS. PRIOR TO THE ADOPTION BY THE COMMISSION OF ANY
S. 3287 8
1 UNIFORM STANDARD, REVISION TO THE BY-LAWS, ANNUAL BUDGET OR OTHER
2 SIGNIFICANT MATTER AS MAY BE PROVIDED IN THE BY-LAWS, THE MANAGEMENT
3 COMMITTEE SHALL CONSULT WITH AND REPORT TO THE LEGISLATIVE COMMITTEE.
4 (J) THE COMMISSION SHALL ESTABLISH TWO ADVISORY COMMITTEES, ONE OF
5 WHICH SHALL COMPRISE CONSUMER REPRESENTATIVES INDEPENDENT OF THE INSUR-
6 ANCE INDUSTRY AND THE OTHER COMPRISING INSURANCE INDUSTRY REPRESEN-
7 TATIVES.
8 (K) THE COMMISSION MAY ESTABLISH ADDITIONAL ADVISORY COMMITTEES AS ITS
9 BY-LAWS MAY PROVIDE FOR THE CARRYING OUT OF ITS FUNCTIONS.
10 (L) THE COMMISSION SHALL MAINTAIN ITS CORPORATE BOOKS AND RECORDS IN
11 ACCORDANCE WITH THE BY-LAWS.
12 (M) THE MEMBERS, OFFICERS, EXECUTIVE DIRECTOR, EMPLOYEES AND REPRESEN-
13 TATIVES OF THE COMMISSION SHALL BE IMMUNE FROM SUIT AND LIABILITY,
14 EITHER PERSONALLY OR IN THEIR OFFICIAL CAPACITY, FOR ANY ACTION TAKEN
15 REASONABLY AND IN GOOD FAITH WHICH RESULTS IN A CLAIM FOR DAMAGE TO OR
16 LOSS OF PROPERTY OR PERSONAL INJURY OR OTHER CIVIL LIABILITY CAUSED BY
17 OR ARISING OUT OF ANY ACTUAL OR ALLEGED ACT, ERROR OR OMISSION THAT
18 OCCURRED, OR THAT SUCH PERSON HAD A REASONABLE BASIS FOR BELIEVING
19 OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR RESPONSI-
20 BILITIES; PROVIDED, THAT NOTHING IN THIS SECTION SHALL BE CONSTRUED TO
21 PROTECT ANY SUCH PERSON FROM SUIT AND/OR LIABILITY FOR ANY DAMAGE, LOSS,
22 INJURY OR LIABILITY CAUSED BY THE INTENTIONAL OR WILLFUL AND WANTON
23 MISCONDUCT OF THAT PERSON.
24 (N) THE COMMISSION SHALL DEFEND ANY MEMBER, OFFICER, EXECUTIVE DIREC-
25 TOR, EMPLOYEE OR REPRESENTATIVE OF THE COMMISSION IN ANY CIVIL ACTION
26 SEEKING TO IMPOSE LIABILITY ARISING OUT OF ANY ACTUAL OR ALLEGED ACT,
27 ERROR OR OMISSION THAT OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOY-
28 MENT, DUTIES OR RESPONSIBILITIES, OR THAT THE DEFENDANT HAD A REASONABLE
29 BASIS FOR BELIEVING OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOYMENT,
30 DUTIES OR RESPONSIBILITIES; PROVIDED, THAT NOTHING IN THIS SECTION SHALL
31 BE CONSTRUED TO PROHIBIT THAT PERSON FROM RETAINING HIS OR HER OWN COUN-
32 SEL; AND PROVIDED FURTHER, THAT THE ACTUAL OR ALLEGED ACT, ERROR OR
33 OMISSION DID NOT RESULT FROM THAT PERSON'S INTENTIONAL OR WILLFUL AND
34 WANTON MISCONDUCT.
35 (O) THE COMMISSION SHALL INDEMNIFY AND HOLD HARMLESS ANY MEMBER, OFFI-
36 CER, EXECUTIVE DIRECTOR, EMPLOYEE OR REPRESENTATIVE OF THE COMMISSION
37 FOR THE AMOUNT OF ANY SETTLEMENT OR JUDGMENT OBTAINED AGAINST SUCH
38 PERSONS ARISING OUT OF ANY ACTUAL OR ALLEGED ACT, ERROR OR OMISSION THAT
39 OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR RESPONSI-
40 BILITIES, OR THAT SUCH PERSON HAD A REASONABLE BASIS FOR BELIEVING
41 OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR RESPONSI-
42 BILITIES, PROVIDED, THAT THE ACTUAL OR ALLEGED ACT, ERROR OR OMISSION
43 DID NOT RESULT FROM THE INTENTIONAL OR WILLFUL AND WANTON MISCONDUCT OF
44 ANY SUCH PERSON.
45 S 8207. MEETINGS AND ACTS OF THE COMMISSION. (A) THE COMMISSION SHALL
46 MEET AND TAKE SUCH ACTIONS AS ARE CONSISTENT WITH THE PROVISIONS OF THIS
47 COMPACT AND THE BY-LAWS.
48 (B) EACH MEMBER OF THE COMMISSION SHALL HAVE THE RIGHT AND POWER TO
49 CAST A VOTE TO WHICH THAT COMPACTING STATE IS ENTITLED AND TO PARTIC-
50 IPATE IN THE BUSINESS AND AFFAIRS OF THE COMMISSION. A MEMBER SHALL VOTE
51 IN PERSON OR BY SUCH OTHER MEANS AS PROVIDED IN THE BY-LAWS. THE BY-LAWS
52 MAY PROVIDE FOR MEMBERS' PARTICIPATION IN MEETINGS BY TELEPHONE OR OTHER
53 MEANS OF COMMUNICATION.
54 (C) THE COMMISSION SHALL MEET AT LEAST ONCE DURING EACH CALENDAR YEAR.
55 ADDITIONAL MEETINGS SHALL BE HELD AS SET FORTH IN THE BY-LAWS.
S. 3287 9
1 S 8208. RULES AND OPERATING PROCEDURES; RULE MAKING FUNCTIONS OF THE
2 COMMISSION AND OPTING OUT OF UNIFORM STANDARDS. (A) THE COMMISSION SHALL
3 PROMULGATE REASONABLE RULES, INCLUDING UNIFORM STANDARDS AND OPERATING
4 PROCEDURES, IN ORDER TO EFFECTIVELY AND EFFICIENTLY ACHIEVE THE PURPOSES
5 OF THE COMPACT. NOTWITHSTANDING THE FOREGOING, IN THE EVENT THE COMMIS-
6 SION EXERCISES ITS RULE MAKING AUTHORITY IN A MANNER THAT IS BEYOND THE
7 SCOPE OF THE PURPOSES OF THIS ARTICLE, OR THE POWERS GRANTED IN THIS
8 SECTION, THEN SUCH ACTION BY THE COMMISSION SHALL BE INVALID AND HAVE NO
9 FORCE AND EFFECT.
10 (B) RULES AND OPERATING PROCEDURES SHALL BE MADE PURSUANT TO A RULE
11 MAKING PROCESS THAT CONFORMS TO THE STATE ADMINISTRATIVE PROCEDURE ACT
12 OF 1981 AS AMENDED, AS MAY BE APPROPRIATE TO THE OPERATIONS OF THE
13 COMMISSION. BEFORE THE COMMISSION ADOPTS A UNIFORM STANDARD, THE COMMIS-
14 SION SHALL GIVE WRITTEN NOTICE TO THE RELEVANT STATE LEGISLATIVE COMMIT-
15 TEE IN EACH COMPACTING STATE RESPONSIBLE FOR INSURANCE ISSUES OF ITS
16 INTENTION TO ADOPT SUCH UNIFORM STANDARD. THE COMMISSION IN ADOPTING A
17 UNIFORM STANDARD SHALL CONSIDER FULLY ALL SUBMITTED MATERIALS AND ISSUE
18 A CONCISE EXPLANATION OF ITS DECISION.
19 (C) A UNIFORM STANDARD SHALL BECOME EFFECTIVE NINETY DAYS AFTER ITS
20 PROMULGATION BY THE COMMISSION OR SUCH LATER DATE AS THE COMMISSION MAY
21 DETERMINE; PROVIDED, HOWEVER, THAT A COMPACTING STATE MAY OPT OUT OF A
22 UNIFORM STANDARD AS PROVIDED IN THIS ARTICLE. "OPT OUT" SHALL BE DEFINED
23 AS ANY ACTION BY A COMPACTING STATE TO DECLINE TO ADOPT OR PARTICIPATE
24 IN A PROMULGATED UNIFORM STANDARD. ALL OTHER RULES AND OPERATING PROCE-
25 DURES, AND AMENDMENTS THERETO, SHALL BECOME EFFECTIVE AS OF THE DATE
26 SPECIFIED IN EACH RULE, OPERATING PROCEDURE OR AMENDMENT.
27 (D) A COMPACTING STATE MAY OPT OUT OF A UNIFORM STANDARD, EITHER BY
28 LEGISLATION OR REGULATION DULY PROMULGATED BY THE SUPERINTENDENT UNDER
29 THE STATE ADMINISTRATIVE PROCEDURE ACT. IF A COMPACTING STATE ELECTS TO
30 OPT OUT OF A UNIFORM STANDARD BY REGULATION, IT MUST GIVE WRITTEN NOTICE
31 TO THE COMMISSION NO LATER THAN TEN BUSINESS DAYS AFTER THE UNIFORM
32 STANDARD IS PROMULGATED OR AT THE TIME THE STATE BECOMES A COMPACTING
33 STATE, AND FIND THAT THE UNIFORM STANDARD DOES NOT PROVIDE REASONABLE
34 PROTECTIONS TO THE CITIZENS OF THE STATE GIVEN THE CONDITIONS IN THE
35 STATE. THE SUPERINTENDENT SHALL MAKE SPECIFIC FINDINGS OF FACT AND
36 CONCLUSIONS OF LAW, BASED ON A PREPONDERANCE OF THE EVIDENCE, DETAILING
37 THE CONDITIONS IN THE STATE WHICH WARRANT A DEPARTURE FROM THE UNIFORM
38 STANDARD AND DETERMINING THAT THE UNIFORM STANDARD WOULD NOT REASONABLY
39 PROTECT THE CITIZENS OF THE STATE. THE SUPERINTENDENT MUST CONSIDER AND
40 BALANCE THE FOLLOWING FACTORS AND FIND THAT THE CONDITIONS IN THE STATE
41 AND NEEDS OF THE CITIZENS OF THE STATE OUTWEIGH:
42 (1) THE INTENT OF THE LEGISLATURE TO PARTICIPATE IN, AND THE BENEFITS
43 OF, AN INTERSTATE AGREEMENT TO ESTABLISH NATIONAL UNIFORM CONSUMER
44 PROTECTIONS FOR THE PRODUCTS SUBJECT TO THIS ARTICLE; AND
45 (2) THE PRESUMPTION THAT A UNIFORM STANDARD ADOPTED BY THE COMMISSION
46 PROVIDES REASONABLE PROTECTIONS TO CONSUMERS OF THE RELEVANT PRODUCT.
47 NOTWITHSTANDING THE FOREGOING, A COMPACTING STATE MAY, AT THE TIME OF
48 ITS ENACTMENT OF THE COMPACT, PROSPECTIVELY OPT OUT OF ALL UNIFORM STAN-
49 DARDS INVOLVING THE LONG-TERM CARE INSURANCE PRODUCTS BY EXPRESSLY
50 PROVIDING FOR SUCH OPT OUT IN THE ENACTED COMPACT, AND SUCH OPT OUT
51 SHALL NOT BE TREATED AS A MATERIAL VARIANCE IN THE OFFER OR ACCEPTANCE
52 OF ANY STATE TO PARTICIPATE IN THE COMPACT. SUCH AN OPT OUT SHALL BE
53 EFFECTIVE AT THE TIME OF ENACTMENT OF THE COMPACT BY THE COMPACTING
54 STATE AND SHALL APPLY TO ALL EXISTING UNIFORM STANDARDS INVOLVING LONG-
55 TERM CARE INSURANCE PRODUCTS AND THOSE SUBSEQUENTLY PROMULGATED.
S. 3287 10
1 (E) IF A COMPACTING STATE ELECTS TO OPT OUT OF A UNIFORM STANDARD, THE
2 UNIFORM STANDARD SHALL REMAIN APPLICABLE IN THE COMPACTING STATE ELECT-
3 ING TO OPT OUT UNTIL SUCH TIME THE OPT OUT LEGISLATION IS ENACTED INTO
4 LAW OR THE REGULATION IS PROMULGATED.
5 (F) ONCE THE OPT OUT OF A UNIFORM STANDARD BY A COMPACTING STATE
6 BECOMES EFFECTIVE AS PROVIDED UNDER THE LAWS OF THAT STATE, THE UNIFORM
7 STANDARD SHALL HAVE NO FURTHER FORCE AND EFFECT IN THAT STATE UNLESS AND
8 UNTIL THE LEGISLATION OR REGULATION IMPLEMENTING THE OPT OUT IS REPEALED
9 OR OTHERWISE BECOMES INEFFECTIVE UNDER THE LAWS OF THE STATE. IF A
10 COMPACTING STATE OPTS OUT OF A UNIFORM STANDARD AFTER THE UNIFORM STAND-
11 ARD HAS BEEN MADE EFFECTIVE IN THAT STATE, THE OPT OUT SHALL HAVE THE
12 SAME PROSPECTIVE EFFECT AS PROVIDED UNDER SECTION EIGHT THOUSAND TWO
13 HUNDRED FIFTEEN OF THIS ARTICLE FOR WITHDRAWALS.
14 (G) IF A COMPACTING STATE HAS FORMALLY INITIATED THE PROCESS OF OPTING
15 OUT OF A UNIFORM STANDARD BY REGULATION, AND WHILE THE REGULATORY OPT
16 OUT IS PENDING, THE COMPACTING STATE MAY PETITION THE COMMISSION, AT
17 LEAST FIFTEEN DAYS BEFORE THE EFFECTIVE DATE OF THE UNIFORM STANDARD, TO
18 STAY THE EFFECTIVENESS OF THE UNIFORM STANDARD IN THAT STATE. THE
19 COMMISSION MAY GRANT A STAY IF IT DETERMINES THE REGULATORY OPT OUT IS
20 BEING PURSUED IN A REASONABLE MANNER AND THERE IS A LIKELIHOOD OF
21 SUCCESS. IF A STAY IS GRANTED OR EXTENDED BY THE COMMISSION, THE STAY OR
22 EXTENSION THEREOF MAY POSTPONE THE EFFECTIVE DATE BY UP TO NINETY DAYS,
23 UNLESS AFFIRMATIVELY EXTENDED BY THE COMMISSION; PROVIDED HOWEVER, A
24 STAY MAY NOT BE PERMITTED TO REMAIN IN EFFECT FOR MORE THAN ONE YEAR
25 UNLESS THE COMPACTING STATE CAN SHOW EXTRAORDINARY CIRCUMSTANCES WHICH
26 WARRANT A CONTINUANCE OF THE STAY INCLUDING, BUT NOT LIMITED TO, THE
27 EXISTENCE OF A LEGAL CHALLENGE WHICH PREVENTS THE COMPACTING STATE FROM
28 OPTING OUT. A STAY MAY BE TERMINATED BY THE COMMISSION UPON NOTICE THAT
29 THE RULE MAKING PROCESS HAS BEEN TERMINATED.
30 (H) NOT LATER THAN THIRTY DAYS AFTER A RULE OR OPERATING PROCEDURE IS
31 PROMULGATED, ANY PERSON MAY FILE A PETITION FOR JUDICIAL REVIEW OF THE
32 RULE OR OPERATING PROCEDURE; PROVIDED, HOWEVER, THAT THE FILING OF SUCH
33 A PETITION SHALL NOT STAY OR OTHERWISE PREVENT THE RULE OR OPERATING
34 PROCEDURE FROM BECOMING EFFECTIVE UNLESS THE COURT FINDS THAT THE PETI-
35 TIONER HAS A SUBSTANTIAL LIKELIHOOD OF SUCCESS. THE COURT SHALL GIVE
36 DEFERENCE TO THE ACTIONS OF THE COMMISSION CONSISTENT WITH APPLICABLE
37 LAW AND SHALL NOT FIND THE RULE OR OPERATING PROCEDURE TO BE UNLAWFUL IF
38 THE RULE OR OPERATING PROCEDURE REPRESENTS A REASONABLE EXERCISE OF THE
39 COMMISSION'S AUTHORITY.
40 S 8209. COMMISSION RECORDS AND ENFORCEMENT. (A) THE COMMISSION SHALL
41 PROMULGATE RULES ESTABLISHING CONDITIONS AND PROCEDURES FOR PUBLIC
42 INSPECTION AND COPYING OF ITS INFORMATION AND OFFICIAL RECORDS, EXCEPT
43 SUCH INFORMATION AND RECORDS INVOLVING THE PRIVACY OF INDIVIDUALS AND
44 INSURERS' TRADE SECRETS. THE COMMISSION MAY PROMULGATE ADDITIONAL RULES
45 UNDER WHICH IT MAY MAKE AVAILABLE TO FEDERAL AND STATE AGENCIES, INCLUD-
46 ING LAW ENFORCEMENT AGENCIES, RECORDS AND INFORMATION OTHERWISE EXEMPT
47 FROM DISCLOSURE, AND MAY ENTER INTO AGREEMENTS WITH SUCH AGENCIES TO
48 RECEIVE OR EXCHANGE INFORMATION OR RECORDS SUBJECT TO NONDISCLOSURE AND
49 CONFIDENTIALITY PROVISIONS.
50 (B) EXCEPT AS TO PRIVILEGED RECORDS, DATA AND INFORMATION, THE LAWS OF
51 ANY COMPACTING STATE PERTAINING TO CONFIDENTIALITY OR NONDISCLOSURE
52 SHALL NOT RELIEVE ANY COMPACTING STATE COMMISSIONER OF THE DUTY TO
53 DISCLOSE ANY RELEVANT RECORDS, DATA OR INFORMATION TO THE COMMISSION;
54 PROVIDED HOWEVER, THAT DISCLOSURE TO THE COMMISSION SHALL NOT BE DEEMED
55 TO WAIVE OR OTHERWISE AFFECT ANY CONFIDENTIALITY REQUIREMENT; AND
56 PROVIDED FURTHER THAT, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS
S. 3287 11
1 ARTICLE, THE COMMISSION SHALL NOT BE SUBJECT TO THE LAWS OF ANY COMPACT-
2 ING STATE PERTAINING TO CONFIDENTIALITY AND NONDISCLOSURE WITH RESPECT
3 TO RECORDS, DATA AND INFORMATION IN ITS POSSESSION. CONFIDENTIAL INFOR-
4 MATION OF THE COMMISSION SHALL REMAIN CONFIDENTIAL AFTER SUCH INFORMA-
5 TION IS PROVIDED TO ANY COMMISSIONER.
6 (C) THE COMMISSION SHALL MONITOR COMPACTING STATES FOR COMPLIANCE WITH
7 DULY ADOPTED BY-LAWS, RULES, INCLUDING UNIFORM STANDARDS, AND OPERATING
8 PROCEDURES. THE COMMISSION SHALL NOTIFY SUCH NONCOMPLYING COMPACTING
9 STATE IN WRITING OF ITS NONCOMPLIANCE WITH COMMISSION BY-LAWS, RULES OR
10 OPERATING PROCEDURES. IF THE NONCOMPLYING COMPACTING STATE FAILS TO
11 REMEDY SUCH NONCOMPLIANCE WITHIN THE TIME SPECIFIED IN THE NOTICE OF
12 NONCOMPLIANCE, THE COMPACTING STATE SHALL BE DEEMED TO BE IN DEFAULT AS
13 SET FORTH IN SECTION EIGHT THOUSAND TWO HUNDRED FIFTEEN OF THIS ARTICLE.
14 (D) THE COMMISSIONER OF ANY STATE IN WHICH AN INSURER IS AUTHORIZED TO
15 DO BUSINESS, OR IS CONDUCTING THE BUSINESS OF INSURANCE, SHALL CONTINUE
16 TO EXERCISE HIS OR HER AUTHORITY TO OVERSEE THE MARKET REGULATION OF THE
17 ACTIVITIES OF THE INSURER IN ACCORDANCE WITH THE PROVISIONS OF THE
18 STATE'S LAW. THE COMMISSIONER'S ENFORCEMENT OF COMPLIANCE WITH THE
19 COMPACT IS GOVERNED BY THE FOLLOWING PROVISIONS:
20 (1) WITH RESPECT TO THE COMMISSIONER'S MARKET REGULATION OF A PRODUCT
21 OR ADVERTISEMENT THAT IS APPROVED OR CERTIFIED BY THE COMMISSION, THE
22 CONTENT OF THE PRODUCT OR ADVERTISEMENT SHALL NOT CONSTITUTE A VIOLATION
23 OF THE PROVISIONS, STANDARDS OR REQUIREMENTS OF THE COMPACT EXCEPT UPON
24 A FINAL ORDER OF THE COMMISSION, ISSUED AT THE REQUEST OF A COMMISSIONER
25 AFTER PRIOR NOTICE TO THE INSURER AND AN OPPORTUNITY FOR HEARING BEFORE
26 THE COMMISSION.
27 (2) BEFORE A COMMISSIONER MAY BRING AN ACTION FOR VIOLATION OF ANY
28 PROVISION, STANDARD OR REQUIREMENT OF THE COMPACT RELATING TO THE
29 CONTENT OF AN ADVERTISEMENT NOT APPROVED OR CERTIFIED BY THE COMMISSION,
30 THE COMMISSION OR AN AUTHORIZED COMMISSION OFFICER OR EMPLOYEE, MUST
31 AUTHORIZE THE ACTION. HOWEVER, AUTHORIZATION PURSUANT TO THIS PARAGRAPH
32 DOES NOT REQUIRE NOTICE TO THE INSURER, OPPORTUNITY FOR HEARING OR
33 DISCLOSURE OF REQUESTS FOR AUTHORIZATION OR RECORDS OF THE COMMISSION'S
34 ACTION ON SUCH REQUESTS.
35 S 8210. DISPUTE RESOLUTION. THE COMMISSION SHALL ATTEMPT, UPON THE
36 REQUEST OF A MEMBER, TO RESOLVE ANY DISPUTES OR OTHER ISSUES THAT ARE
37 SUBJECT TO THIS COMPACT AND WHICH MAY ARISE BETWEEN TWO OR MORE COMPACT-
38 ING STATES, OR BETWEEN COMPACTING STATES AND NON-COMPACTING STATES, AND
39 THE COMMISSION SHALL PROMULGATE AN OPERATING PROCEDURE PROVIDING FOR
40 RESOLUTION OF SUCH DISPUTES.
41 S 8211. PRODUCT FILING AND APPROVAL. (A) INSURERS AND THIRD-PARTY
42 FILERS SEEKING TO HAVE A PRODUCT APPROVED BY THE COMMISSION SHALL FILE
43 SUCH PRODUCT WITH, AND PAY APPLICABLE FILING FEES TO, THE COMMISSION.
44 NOTHING IN THIS ARTICLE SHALL BE CONSTRUED TO RESTRICT OR OTHERWISE
45 PREVENT AN INSURER FROM FILING ITS PRODUCT WITH THE INSURANCE DEPARTMENT
46 IN ANY STATE WHEREIN SUCH INSURER IS LICENSED TO CONDUCT THE BUSINESS OF
47 INSURANCE, AND SUCH FILING SHALL BE SUBJECT TO THE LAWS OF THE STATES
48 WHERE FILED.
49 (B) THE COMMISSION SHALL ESTABLISH APPROPRIATE FILING AND REVIEW PROC-
50 ESSES AND PROCEDURES PURSUANT TO COMMISSION RULES AND OPERATING PROCE-
51 DURES. NOTWITHSTANDING ANY PROVISION IN THIS SECTION TO THE CONTRARY,
52 THE COMMISSION SHALL PROMULGATE RULES TO ESTABLISH CONDITIONS AND PROCE-
53 DURES UNDER WHICH THE COMMISSION WILL PROVIDE PUBLIC ACCESS TO PRODUCT
54 FILING INFORMATION. IN ESTABLISHING SUCH RULES, THE COMMISSION SHALL
55 CONSIDER THE INTERESTS OF THE PUBLIC IN HAVING ACCESS TO SUCH INFORMA-
56 TION, AS WELL AS PROTECTION OF PERSONAL MEDICAL AND FINANCIAL INFORMA-
S. 3287 12
1 TION AND TRADE SECRETS, THAT MAY BE CONTAINED IN A PRODUCT FILING OR
2 SUPPORTING INFORMATION.
3 (C) ANY PRODUCT APPROVED BY THE COMMISSION MAY BE SOLD OR OTHERWISE
4 ISSUED IN THOSE COMPACTING STATES IN WHICH THE INSURER IS LEGALLY
5 AUTHORIZED TO DO BUSINESS.
6 S 8212. REVIEW OF COMMISSION DECISIONS REGARDING FILINGS. (A) NOT
7 LATER THAN THIRTY DAYS AFTER THE COMMISSION HAS GIVEN NOTICE OF A DISAP-
8 PROVED PRODUCT OR ADVERTISEMENT FILED WITH THE COMMISSION, THE INSURER
9 OR THIRD PARTY FILER WHOSE FILING WAS DISAPPROVED MAY APPEAL THE DETER-
10 MINATION TO A REVIEW PANEL APPOINTED BY THE COMMISSION. THE COMMISSION
11 SHALL PROMULGATE RULES TO ESTABLISH PROCEDURES FOR APPOINTING SUCH
12 REVIEW PANEL AND PROVIDE FOR NOTICE AND HEARING. AN ALLEGATION THAT THE
13 COMMISSION, IN DISAPPROVING A PRODUCT OR ADVERTISEMENT FILED WITH THE
14 COMMISSION, ACTED ARBITRARILY, CAPRICIOUSLY OR IN A MANNER THAT IS AN
15 ABUSE OF DISCRETION OR OTHERWISE NOT IN ACCORDANCE WITH LAW, IS SUBJECT
16 TO JUDICIAL REVIEW IN ACCORDANCE WITH SUBSECTION (E) OF SECTION EIGHT
17 THOUSAND TWO HUNDRED FOUR OF THIS ARTICLE.
18 (B) THE COMMISSION SHALL HAVE AUTHORITY TO MONITOR, REVIEW AND RECON-
19 SIDER PRODUCTS AND ADVERTISEMENT SUBSEQUENT TO THEIR FILING OR APPROVAL
20 UPON A FINDING THAT THE PRODUCT DOES NOT MEET THE RELEVANT UNIFORM STAN-
21 DARD. WHERE APPROPRIATE, THE COMMISSION MAY WITHDRAW OR MODIFY ITS
22 APPROVAL AFTER PROPER NOTICE AND HEARING, SUBJECT TO THE APPEAL PROCESS
23 SET FORTH IN SUBSECTION (A) OF THIS SECTION.
24 S 8213. FINANCE. (A) THE COMMISSION SHALL PAY OR PROVIDE FOR THE
25 PAYMENT OF THE REASONABLE EXPENSES OF ITS ESTABLISHMENT AND ORGANIZA-
26 TION. TO FUND THE COST OF ITS INITIAL OPERATIONS, THE COMMISSION MAY
27 ACCEPT CONTRIBUTIONS AND OTHER FORMS OF FUNDING FROM THE NAIC, COMPACT-
28 ING STATES AND OTHER SOURCES. CONTRIBUTIONS AND OTHER FORMS OF FUNDING
29 FROM OTHER SOURCES SHALL BE OF SUCH A NATURE THAT THE INDEPENDENCE OF
30 THE COMMISSION CONCERNING THE PERFORMANCE OF ITS DUTIES SHALL NOT BE
31 COMPROMISED.
32 (B) THE COMMISSION SHALL COLLECT A FILING FEE FROM EACH INSURER AND
33 THIRD PARTY FILER FILING A PRODUCT WITH THE COMMISSION TO COVER THE COST
34 OF THE OPERATIONS AND ACTIVITIES OF THE COMMISSION AND ITS STAFF IN A
35 TOTAL AMOUNT SUFFICIENT TO COVER THE COMMISSION'S ANNUAL BUDGET.
36 (C) THE COMMISSION'S BUDGET FOR A FISCAL YEAR SHALL NOT BE APPROVED
37 UNTIL IT HAS BEEN SUBJECT TO NOTICE AND COMMENT AS SET FORTH IN SECTION
38 EIGHT THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE.
39 (D) THE COMMISSION SHALL BE EXEMPT FROM ALL TAXATION IN AND BY THE
40 COMPACTING STATES.
41 (E) THE COMMISSION SHALL NOT PLEDGE THE CREDIT OF ANY COMPACTING
42 STATE, EXCEPT BY AND WITH THE APPROPRIATE LEGAL AUTHORITY OF THAT
43 COMPACTING STATE.
44 (F) THE COMMISSION SHALL KEEP COMPLETE AND ACCURATE ACCOUNTS OF ALL
45 ITS INTERNAL RECEIPTS, INCLUDING GRANTS AND DONATIONS AND DISBURSEMENTS
46 OF ALL FUNDS UNDER ITS CONTROL. THE INTERNAL FINANCIAL ACCOUNTS OF THE
47 COMMISSION SHALL BE SUBJECT TO THE ACCOUNTING PROCEDURES ESTABLISHED
48 UNDER ITS BY-LAWS. THE FINANCIAL ACCOUNTS AND REPORTS INCLUDING THE
49 SYSTEM OF INTERNAL CONTROLS AND PROCEDURES OF THE COMMISSION SHALL BE
50 AUDITED ANNUALLY BY AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT. UPON THE
51 DETERMINATION OF THE COMMISSION, BUT NO LESS FREQUENTLY THAN EVERY THREE
52 YEARS, THE REVIEW OF SUCH INDEPENDENT AUDITOR SHALL INCLUDE A MANAGEMENT
53 AND PERFORMANCE AUDIT OF THE COMMISSION. THE COMMISSION SHALL MAKE AN
54 ANNUAL REPORT TO THE GOVERNOR AND LEGISLATURE OF THE COMPACTING STATES,
55 WHICH SHALL INCLUDE A REPORT OF SUCH INDEPENDENT AUDIT. THE COMMISSION'S
56 INTERNAL ACCOUNTS SHALL NOT BE CONFIDENTIAL AND SUCH MATERIALS MAY BE
S. 3287 13
1 SHARED WITH THE COMMISSIONER OF ANY COMPACTING STATE UPON REQUEST,
2 PROVIDED, HOWEVER, THAT ANY WORK PAPERS RELATED TO ANY INTERNAL OR INDE-
3 PENDENT AUDIT AND ANY INFORMATION REGARDING THE PRIVACY OF INDIVIDUALS
4 AND INSURERS' PROPRIETARY INFORMATION, INCLUDING TRADE SECRETS, SHALL
5 REMAIN CONFIDENTIAL.
6 (G) NO COMPACTING STATE SHALL HAVE ANY CLAIM TO OR OWNERSHIP OF ANY
7 PROPERTY HELD BY OR VESTED IN THE COMMISSION OR TO ANY COMMISSION FUNDS
8 HELD PURSUANT TO THE PROVISIONS OF THIS COMPACT.
9 S 8214. COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT. (A) ANY STATE
10 IS ELIGIBLE TO BECOME A COMPACTING STATE.
11 (B) THE COMPACT SHALL BECOME EFFECTIVE AND BINDING UPON LEGISLATIVE
12 ENACTMENT OF THE COMPACT INTO LAW BY TWO COMPACTING STATES; PROVIDED
13 HOWEVER, THAT THE COMMISSION SHALL BECOME EFFECTIVE FOR PURPOSES OF
14 ADOPTING UNIFORM STANDARDS FOR REVIEWING, AND GIVING APPROVAL OR DISAP-
15 PROVAL OF, PRODUCTS FILED WITH THE COMMISSION THAT SATISFY APPLICABLE
16 UNIFORM STANDARDS ONLY AFTER TWENTY-SIX STATES ARE COMPACTING STATES OR,
17 ALTERNATIVELY, BY STATES REPRESENTING GREATER THAN FORTY PERCENT OF THE
18 PREMIUM VOLUME FOR LIFE INSURANCE, ANNUITY, DISABILITY INCOME AND LONG-
19 TERM CARE INSURANCE PRODUCTS, BASED ON RECORDS OF THE NAIC FOR THE PRIOR
20 YEAR. THEREAFTER, IT SHALL BECOME EFFECTIVE AND BINDING AS TO ANY OTHER
21 COMPACTING STATE UPON ENACTMENT OF THE COMPACT INTO LAW BY THAT STATE.
22 (C) AMENDMENTS TO THE COMPACT MAY BE PROPOSED BY THE COMMISSION FOR
23 ENACTMENT BY THE COMPACTING STATES. NO AMENDMENT SHALL BECOME EFFECTIVE
24 AND BINDING UPON THE COMMISSION AND THE COMPACTING STATES UNLESS AND
25 UNTIL ALL COMPACTING STATES ENACT THE AMENDMENT INTO LAW.
26 S 8215. WITHDRAWAL, DEFAULT AND TERMINATION. (A)(1) ONCE EFFECTIVE,
27 THE COMPACT SHALL CONTINUE IN FORCE AND REMAIN BINDING UPON EACH AND
28 EVERY COMPACTING STATE; PROVIDED THAT A COMPACTING STATE MAY WITHDRAW
29 FROM THE COMPACT ("WITHDRAWING STATE") BY ENACTING A STATUTE SPECIF-
30 ICALLY REPEALING THE STATUTE WHICH ENACTED THE COMPACT INTO LAW.
31 (2) THE EFFECTIVE DATE OF WITHDRAWAL IS THE EFFECTIVE DATE OF THE
32 REPEALING STATUTE. HOWEVER, THE WITHDRAWAL SHALL NOT APPLY TO ANY PROD-
33 UCT FILINGS APPROVED OR SELF-CERTIFIED, OR ANY ADVERTISEMENT OF SUCH
34 PRODUCTS, ON THE DATE THE REPEALING STATUTE BECOMES EFFECTIVE, EXCEPT BY
35 MUTUAL AGREEMENT OF THE COMMISSION AND THE WITHDRAWING STATE UNLESS THE
36 APPROVAL IS RESCINDED BY THE WITHDRAWING STATE AS PROVIDED IN PARAGRAPH
37 FIVE OF THIS SUBSECTION.
38 (3) THE COMMISSIONER OF THE WITHDRAWING STATE SHALL IMMEDIATELY NOTIFY
39 THE MANAGEMENT COMMITTEE IN WRITING UPON THE INTRODUCTION OF LEGISLATION
40 REPEALING THIS COMPACT IN THE WITHDRAWING STATE.
41 (4) THE COMMISSION SHALL NOTIFY THE OTHER COMPACTING STATES OF THE
42 INTRODUCTION OF SUCH LEGISLATION WITHIN TEN DAYS AFTER ITS RECEIPT OF
43 NOTICE THEREOF.
44 (5) THE WITHDRAWING STATE IS RESPONSIBLE FOR ALL OBLIGATIONS, DUTIES
45 AND LIABILITIES INCURRED THROUGH THE EFFECTIVE DATE OF WITHDRAWAL,
46 INCLUDING ANY OBLIGATIONS, THE PERFORMANCE OF WHICH EXTEND BEYOND THE
47 EFFECTIVE DATE OF WITHDRAWAL, EXCEPT TO THE EXTENT THOSE OBLIGATIONS MAY
48 HAVE BEEN RELEASED OR RELINQUISHED BY MUTUAL AGREEMENT OF THE COMMISSION
49 AND THE WITHDRAWING STATE. THE COMMISSION'S APPROVAL OF PRODUCTS AND
50 ADVERTISEMENT PRIOR TO THE EFFECTIVE DATE OF WITHDRAWAL SHALL CONTINUE
51 TO BE EFFECTIVE AND BE GIVEN FULL FORCE AND EFFECT IN THE WITHDRAWING
52 STATE, UNLESS FORMALLY RESCINDED BY THE WITHDRAWING STATE IN THE SAME
53 MANNER AS PROVIDED BY THE LAWS OF THE WITHDRAWING STATE FOR THE PROSPEC-
54 TIVE DISAPPROVAL OF PRODUCTS OR ADVERTISEMENT PREVIOUSLY APPROVED UNDER
55 STATE LAW.
S. 3287 14
1 (6) REINSTATEMENT FOLLOWING WITHDRAWAL OF ANY COMPACTING STATE SHALL
2 OCCUR UPON THE EFFECTIVE DATE OF THE WITHDRAWING STATE'S LEGISLATION
3 REENACTING THE COMPACT.
4 (B) (1) IF THE COMMISSION DETERMINES THAT ANY COMPACTING STATE HAS AT
5 ANY TIME DEFAULTED ("DEFAULTING STATE") IN THE PERFORMANCE OF ANY OF ITS
6 OBLIGATIONS OR RESPONSIBILITIES UNDER THIS COMPACT, THE BY-LAWS OR DULY
7 PROMULGATED RULES OR OPERATING PROCEDURES, THEN, AFTER NOTICE AND HEAR-
8 ING AS SET FORTH IN THE BY-LAWS, ALL RIGHTS, PRIVILEGES AND BENEFITS
9 CONFERRED BY THE COMPACT ON THE DEFAULTING STATE SHALL BE SUSPENDED FROM
10 THE EFFECTIVE DATE OF DEFAULT AS FIXED BY THE COMMISSION. THE GROUNDS
11 FOR DEFAULT INCLUDE, BUT ARE NOT LIMITED TO, FAILURE OF A COMPACTING
12 STATE TO PERFORM ITS OBLIGATIONS OR RESPONSIBILITIES, AND ANY OTHER
13 GROUNDS DESIGNATED IN COMMISSION RULES. THE COMMISSION SHALL IMMEDIATELY
14 NOTIFY THE DEFAULTING STATE IN WRITING OF THE DEFAULTING STATE'S SUSPEN-
15 SION PENDING A CURE OF THE DEFAULT. THE COMMISSION SHALL STIPULATE THE
16 CONDITIONS AND THE TIME PERIOD WITHIN WHICH THE DEFAULTING STATE MUST
17 CURE ITS DEFAULT. IF THE DEFAULTING STATE FAILS TO CURE THE DEFAULT
18 WITHIN THE TIME PERIOD SPECIFIED BY THE COMMISSION, THE DEFAULTING STATE
19 SHALL BE TERMINATED FROM THE COMPACT AND ALL RIGHTS, PRIVILEGES AND
20 BENEFITS CONFERRED BY THE COMPACT SHALL BE TERMINATED FROM THE EFFECTIVE
21 DATE OF TERMINATION.
22 (2) PRODUCT APPROVALS BY THE COMMISSION OR PRODUCT SELF-CERTIFICA-
23 TIONS, OR ANY ADVERTISEMENT IN CONNECTION WITH SUCH PRODUCT, THAT ARE IN
24 FORCE ON THE EFFECTIVE DATE OF TERMINATION SHALL REMAIN IN FORCE IN THE
25 DEFAULTING STATE IN THE SAME MANNER AS IF THE DEFAULTING STATE HAD WITH-
26 DRAWN VOLUNTARILY UNDER THIS SECTION.
27 (3) REINSTATEMENT FOLLOWING TERMINATION OF ANY COMPACTING STATE
28 REQUIRES A REENACTMENT OF THE COMPACT BY THAT STATE.
29 (C)(1) THE COMPACT DISSOLVES EFFECTIVE UPON THE DATE OF THE WITHDRAWAL
30 OR DEFAULT OF THE COMPACTING STATE WHICH REDUCES MEMBERSHIP IN THE
31 COMPACT TO ONE COMPACTING STATE.
32 (2) UPON THE DISSOLUTION OF THE COMPACT, THE COMPACT BECOMES NULL AND
33 VOID AND SHALL BE OF NO FURTHER FORCE OR EFFECT, AND THE BUSINESS AND
34 AFFAIRS OF THE COMMISSION SHALL BE WOUND UP AND ANY SURPLUS FUNDS SHALL
35 BE DISTRIBUTED IN ACCORDANCE WITH THE BY-LAWS.
36 S 8216. SEVERABILITY AND CONSTRUCTION. (A) THE PROVISIONS OF THE
37 COMPACT SHALL BE SEVERABLE; AND IF ANY PHRASE, CLAUSE, SENTENCE OR
38 PROVISION IS DEEMED UNENFORCEABLE, THE REMAINING PROVISIONS OF THE
39 COMPACT SHALL BE ENFORCEABLE.
40 (B) THE PROVISIONS OF THE COMPACT SHALL BE LIBERALLY CONSTRUED TO
41 EFFECTUATE ITS PURPOSES.
42 S 8217. BINDING EFFECT OF COMPACT AND OTHER LAWS. (A) NOTHING IN THIS
43 SECTION PREVENTS THE ENFORCEMENT OF ANY OTHER LAW OF A COMPACTING STATE,
44 EXCEPT AS PROVIDED IN SUBSECTION (B) OF THIS SECTION.
45 (B) FOR ANY PRODUCT APPROVED OR CERTIFIED TO THE COMMISSION, THE
46 RULES, UNIFORM STANDARDS AND ANY OTHER REQUIREMENTS OF THE COMMISSION
47 SHALL CONSTITUTE THE EXCLUSIVE PROVISIONS APPLICABLE TO THE CONTENT,
48 APPROVAL AND CERTIFICATION OF SUCH PRODUCTS. FOR ADVERTISEMENT THAT IS
49 SUBJECT TO THE COMMISSION'S AUTHORITY, ANY RULE, UNIFORM STANDARD OR
50 OTHER REQUIREMENT OF THE COMMISSION WHICH GOVERNS THE CONTENT OF THE
51 ADVERTISEMENT SHALL CONSTITUTE THE EXCLUSIVE PROVISION THAT A COMMIS-
52 SIONER MAY APPLY TO THE CONTENT OF THE ADVERTISEMENT. NOTWITHSTANDING
53 THE FOREGOING, NO ACTION TAKEN BY THE COMMISSION SHALL ABROGATE OR
54 RESTRICT:
55 (1) THE ACCESS OF ANY PERSON TO STATE COURTS;
S. 3287 15
1 (2) REMEDIES AVAILABLE UNDER STATE LAW RELATED TO BREACH OF CONTRACT,
2 TORT OR OTHER LAWS NOT SPECIFICALLY DIRECTED TO THE CONTENT OF THE PROD-
3 UCT;
4 (3) STATE LAW RELATING TO THE CONSTRUCTION OF INSURANCE CONTRACTS; OR
5 (4) THE AUTHORITY OF THE ATTORNEY GENERAL OF THE STATE INCLUDING, BUT
6 NOT LIMITED TO, MAINTAINING ANY ACTIONS OR PROCEEDINGS AS AUTHORIZED BY
7 LAW.
8 (C) ALL INSURANCE PRODUCTS FILED WITH INDIVIDUAL STATES SHALL BE
9 SUBJECT TO THE LAWS OF THOSE STATES.
10 (D) ALL LAWFUL ACTIONS OF THE COMMISSION, INCLUDING ALL RULES AND
11 OPERATING PROCEDURES PROMULGATED BY THE COMMISSION, ARE BINDING UPON THE
12 COMPACTING STATES.
13 (E) ALL AGREEMENTS BETWEEN THE COMMISSION AND THE COMPACTING STATES
14 ARE BINDING IN ACCORDANCE WITH THEIR TERMS.
15 (F) UPON THE REQUEST OF A PARTY TO A CONFLICT OVER THE MEANING OR
16 INTERPRETATION OF COMMISSION ACTIONS, AND UPON A MAJORITY VOTE OF THE
17 COMPACTING STATES, THE COMMISSION MAY ISSUE ADVISORY OPINIONS REGARDING
18 THE DISPUTED MEANING OR INTERPRETATION.
19 (G) IN THE EVENT ANY PROVISION OF THIS ARTICLE EXCEEDS THE CONSTITU-
20 TIONAL LIMITS IMPOSED ON THE LEGISLATURE OF ANY COMPACTING STATE, THE
21 OBLIGATIONS, DUTIES, POWERS OR JURISDICTION SOUGHT TO BE CONFERRED BY
22 THAT PROVISION UPON THE COMMISSION SHALL BE INEFFECTIVE AS TO SUCH
23 COMPACTING STATE, AND SUCH OBLIGATIONS, DUTIES, POWERS OR JURISDICTION
24 SHALL REMAIN IN THE COMPACTING STATE AND SHALL BE EXERCISED BY THE AGEN-
25 CY THEREOF TO WHICH SUCH OBLIGATIONS, DUTIES, POWERS OR JURISDICTION ARE
26 DELEGATED BY LAW IN EFFECT AT THE TIME THE COMPACT BECOMES EFFECTIVE.
27 S 3. This act shall take effect on the one hundred eightieth day after
28 it shall have become a law.