WSR 11-21-094

PROPOSED RULES

OFFICE OF

INSURANCE COMMISSIONER

[ Insurance Commissioner Matter No. R 2011-19 -- Filed October 19, 2011, 7:08 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 11-17-127.

Title of Rule and Other Identifying Information: Biographical affidavits, adding a new section to chapter 284-07 WAC.

Hearing Location(s): Insurance Commissioner's Office, Room TR 120, 5000 Capitol Boulevard, Tumwater, WA 98504-0255, http://www.insurance.wa.gov/about/directions.shtml, on November 30, at 10:00 a.m.

Date of Intended Adoption: December 5, 2011.

Submit Written Comments to: Donna Dorris, P.O. Box 40258, Olympia, WA 98504-0258, e-mail donnad@oic.wa.gov, fax (360) 586-3109, by November 29, 2011.

Assistance for Persons with Disabilities: Contact Lori [Lorie] Villaflores by November 28, 2011, TTY (360) 586-0241 or (360) 725-7087.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: This proposed rule defines the requirements of filing a biographical affidavit for foreign, alien, and domestic insurers. It further outlines additional circumstances requiring domestic insurers to file a new biographical affidavit.

Reasons Supporting Proposal: This proposed rule standardizes time frames and circumstances for filing additional biographical affidavits for domestic insurers.

Statutory Authority for Adoption: RCW 48.02.060, 48.36A.290, 48.44.050, 48.46.030, and 48.46.200.

Statute Being Implemented: Chapters 48.05, 48.36A, 48.44, 48.46, and 48.125 RCW.

Rule is not necessitated by federal law, federal or state court decision.

Name of Proponent: Mike Kreidler, insurance commissioner, governmental.

Name of Agency Personnel Responsible for Drafting: Donna Dorris, P.O. Box 40258, Olympia, WA 98504-0258, (360) 725-7040; Implementation: Jim Odiorne, P.O. Box 40255, Olympia, WA 98504-0255, (360) 725-7214; and Enforcement: Carol Sureau, P.O. Box 40255, Olympia, WA 98504-0255, (360) 725-7050.

No small business economic impact statement has been prepared under chapter 19.85 RCW. The only businesses affected by this proposed rule are domestic insurers and alien (port of entry) insurers. The increased cost of meeting this proposed new requirement is less than 0.3 percent of the average Washington revenue of the smallest domestic insurers. Therefore a small business economic impact statement is not required for this proposed rule.

A cost-benefit analysis is required under RCW 34.05.328. A preliminary cost-benefit analysis may be obtained by contacting Donna Dorris, P.O. Box 40258, Olympia, WA 98504-0258, phone (360) 725-7040, fax (360) 586-3109, e-mail donnad@oic.wa.gov.

October 17, 2011

Mike Kreidler

Insurance Commissioner

OTS-4247.4

BIOGRAPHICAL AFFIDAVITS
NEW SECTION
WAC 284-07-600   Definitions.   For the purposes of this regulation, WAC 284-07-610 and 284-07-620, called the biographical affidavits regulation, the following definitions apply:

(1) A "biographical affidavit" means the current National Association of Insurance Commissioners (NAIC) Biographical Affidavit, Form 11, available on the NAIC's web site at www.naic.org.

(2) A "domestic insurer" includes an entity organized under the laws of this state, domiciled in this state or using this state as its state of entry including:

(a) An insurer authorized under chapter 48.05 RCW.

(b) A fraternal benefit society as defined in RCW 48.36A.010 and authorized under chapter 48.36A RCW.

(c) A health care service contractor defined in RCW 48.44.010 and registered under chapter 48.44 RCW.

(d) A health maintenance organization defined in RCW 48.46.020 and registered under chapter 48.46 RCW.

(e) A self-funded multiple employer welfare arrangement defined in RCW 48.125.010 and authorized under chapter 48.125 RCW.

(f) An alien insurer authorized under chapter 48.05 RCW and subject to the requirements under chapter 48.35 RCW.

(3) A "foreign insurer" or an "alien insurer" are as defined in RCW 48.05.010 and authorized under chapter 48.05 RCW.

(4) An "officer" or "director" includes:

(a) A controlling individual as defined in RCW 48.31B.005(2) and 48.31C.010(3);

(b) An executive officer as defined in WAC 284-18-340 and 284-18A-340; and

(c) Key management personnel who control the operations of a domestic, foreign or alien insurer.

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NEW SECTION
WAC 284-07-610   Filing requirements for foreign and alien insurers.   (1) Foreign and alien insurers must file a biographical affidavit for each officer or director as specified by the NAIC Uniform Certificate of Authority Application (UCAA) as part of an application for certificate of authority or certificate of registration.

(2) Alien insurers authorized under chapter 48.35 RCW must meet the requirements of WAC 284-07-620.

(3) Biographical affidavits must be investigated and verified by a vendor authorized by the NAIC to perform a state, national, or international history background check. Verification reports must be submitted directly to the commissioner by the background investigation agency.

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NEW SECTION
WAC 284-07-620   Filing requirements for domestic insurers.   (1) Domestic insurers must file a biographical affidavit:

(a) For each officer or director as part of an application for a solicitation permit, certificate of authority, or certificate of registration.

(b) Within thirty business days after:

(i) An individual becomes an officer or director;

(ii) A material change of filed information required in the biographical affidavit; or

(iii) At the request of the commissioner.

(c) Within fifteen business days, of any information concerning the conviction of an officer or director of a felony or the naming of an officer or director, other than as a party plaintiff or complainant, in a criminal or civil action in which fraud is an issue.

(d) Every thirty-six months after the last biographical affidavit filed.

(2) An officer or director may choose to list all affiliate insurers and insurers under common control on one biographical affidavit in lieu of filing a separate form for each affiliated insurer.

(3) Biographical affidavits must be investigated and verified by a vendor authorized by the NAIC to perform a state, national, or international history background check. Verification reports must be submitted directly to the commissioner by the background investigation agency.

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Washington State Code Reviser's Office