2026 Proposed Amendments to Insurance Code
Department's proposed amendments with summaries
The Insurance Department has submitted proposals to amend the Insurance Code during the 2026 legislative session. The text of the proposals, and a brief summary of each, are presented below. As you review the proposals, please keep the following in mind:
- Technical change: Formatting, numbering, word order or language changes only
- Codifies practice: Changed language but no change in practice
- Policy Change: New language and new practice
Accessibility Note: Aside from this link to a PDF copy of this summary, there are no other links on this page. All underlined text represents language that is proposed to be added to statute. All [bracketed and struckthrough text] represents language that is proposed to be removed from statute.
Amendment text
31A-2-104.
(1) The department shall employ professional, technical, and clerical employees as necessary to carry out the duties of the department.
(2) An insurance fraud investigator employed in accordance with Subsection (1) may as the commissioner approves:
(a) be designated a law enforcement officer, as defined in Section 53-13-103; [and]
(b) be eligible for retirement benefits under the Public Safety Employee's Retirement System[.]; and
(c) investigate crimes committed by a department licensee while performing activity regulated under this Title.
Nature of change
Codifies practice: The Department’s Insurance Fraud Division investigates Department licensees who commit crimes while performing activity that the Department regulates. This amendment confirms that investigators are authorized to do so.
Amendment text
31A-2-203.
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(3)
(a) The commissioner may order an independent audit or examination by one or more independent contractors[technical experts], including certified public accountants, investment specialists and information technology specialists:[certified public accountant or actuary]:
(i) in lieu of all or part of an examination under Subsection (1) or (2); or
(ii) in addition to an examination under Subsection (1) or (2).
(b) The commissioner may employ one or more independent contractors who are qualified by knowledge, skill, experience, training or education to provide specialized assistance in an examination.
[(b)](c) [An audit or evaluation] Services performed under this Subsection (3) [is]are subject to Subsection (5), Section 31A-2-204, and Subsection 31A-2-205(4).
Nature of change
Codifies practice: The law requires insurance companies to pay the cost of being financially examined by the Department. This includes, in some cases, the cost of hiring independent contractors who assist with the examination. The proposed amendments clarify the kind of experts that the commissioner may hire and the companies under examination must pay for.
Amendment text
31A-2-205.
(1)
[(a)] Except as provided in Subsection (3), an examinee that is one of the following shall pay [reimburse the department] for the reasonable costs of examinations made under Sections 31A-2-203 and 31A-2-204:
[(i)](a) an insurer;
[(ii)](b) a rate service organization;
[(iii)](c) a subsidiary of an insurer or rate service organization; or
[(iv)](d) a life settlement provider.
[(b)](2) [The following costs shall be reimbursed] An examinee shall pay the following costs of the department under [this] Subsection (1):
[(i)](a) an examiner’s actual travel expenses;
[(ii)](b) an examiner’s reasonable living expenses;
[(iii)](c) an examiner’s actual rate of compensation [the department’s financial regulation employees who participate in the examination];
[(iv) the administration and supervisory expense of:
(A) the department; and
(B) the attorney general's office; and
(v) an amount necessary to cover fringe benefits authorized by the commissioner or provided by law.]
(d) the administration, support and supervisory expenses of the department for the examination; and
(e) an amount necessary to cover fringe benefits authorized by the commissioner or provided by law.
(3) An examinee shall pay the following costs of independent contractors employed under Section 31A-2-203(3):
(a) actual travel expenses;
(b) reasonable living expenses;
(c) compensation; and
(d) expenses necessarily incurred as approved by the commissioner.
[(c) The examined insurer shall reimburse the department for:
(i) a department examiner's:
(A) actual travel expenses; and
(B) reasonable living expenses; and
(ii) the compensation of department examiners involved in the examination.
(d)
(i) The examined insurer shall certify the consolidated account of all charges and expenses for the examination.
(ii) The examined insurer shall:
(A) retain a copy of the consolidated account; and
(B) file a copy of the consolidated account with the department as a public record.]
[(c)](4) In determining rates, the commissioner shall consider the rates recommended and outlined in the examination manual sponsored by the National Association of Insurance Commissioners.
[(d)](5) [This Subsection] Subsections (1) through (4) apply [applies] to a surplus lines producer to the extent that the examinations are of the surplus line producer's surplus lines business.
[(2)](6) An insurer requesting the examination of one of its producers shall pay the cost of the examination to the extent described in Subsections (1) through (4). Otherwise, the department shall pay the cost of examining a licensee other than those specified under Subsection (1).
[(3)](7)
(a) On the examinee's request or at the commissioner's discretion, the department may pay all or part of the costs of an examination whenever the commissioner finds that, [because of] based on the frequency of examinations or the examinee’s financial condition:[ of the examinee],
(i) the imposition of the costs would place an unreasonable burden on the examinee; and
(ii) the Department has sufficient budget to pay those costs.
(b) The commissioner shall include in the commissioner's annual report information about any instance in which the commissioner has applied this Subsection [(3)](7).
[(4)](8)
(a) [A technical expert] An independent contractor employed under Subsection 31A-2-203(3) shall present to the commissioner [a statement of all expenses incurred] an invoice for the costs described in Subsection (3)[:].
(b) The [examined insurer] examinee shall pay the invoice after the commissioner:
(i) reviews the invoice;
(ii) approves the invoice for payment; and
(iii) delivers the invoice to the examinee with a direction to pay the invoice.[, at the commissioner's direction, pay the invoice. [to a technical expert:
(i)
(A) actual travel expenses;
(B) reasonable living expenses; and
(C) compensation for services provided; and
(ii) for expenses necessarily incurred as approved by the commissioner.
(c) The examined insurer shall reimburse the department for:
(i) a department examiner's:
(A) actual travel expenses; and
(B) reasonable living expenses; and
(ii) the compensation of department examiners involved in the examination.
(d)
(i) The examined insurer shall certify the consolidated account of all charges and expenses for the examination.
(ii) The examined insurer shall:
(A) retain a copy of the consolidated account; and
(B) file a copy of the consolidated account with the department as a public record.]
(c) Invoice disputes shall be resolved according to department rules made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
[(e) An annual report of examination charges paid by examined insurers directly to persons employed under Subsection 31A-2-203(3) or to department examiners shall be included with the department's budget request.]
[(f)](9) Amounts paid directly by examinees [examined insurers] to persons employed under Subsection 31A-2-203(3) or to department examiners may not be deducted from the department's appropriation.
[(5)](10)
(a) The amount payable under Subsection (1) is due 10 days after the day on which the commissioner directs the examinee [is served with a detailed account of the costs] to pay the invoice.
(b) Payments received by the department under this Subsection [(5)] (10) shall be handled as provided by Section 31A-3-101.
[(6)](11)
(a) The commissioner may require an examinee under Subsection (1), or an insurer requesting an examination under Subsection [(2)](6), either before or during an examination, to make deposits with the state treasurer to pay the costs of examination.
(b) Any deposit made under this Subsection [(6)](11) shall be held in trust by the state treasurer until applied to pay the department the costs payable under this section.
(c) If a deposit made under this Subsection [(6)](11) exceeds examination costs, the state treasurer shall refund the surplus.
(12) If an examinee does not timely pay examination costs, the commissioner may satisfy the debt by drawing on a statutory deposit filed by the examinee under Section 31A-2-206.
[(7)](13) A domestic insurer may offset the examination expenses paid under this section against premium taxes under Subsection 59-9-102(2).
Nature of change
Codifies practice: The proposed amendments clarify the requirements and processes that insurers must comply with in paying for a financial examination by the Department.
Technical change: Because all examinations are now paid for by the company being examined, the Department no longer makes a budget request for funds to pay for examinations. Accordingly, it is no longer necessary to report charges paid by examined insurance companies.
Amendment text
31A-2-206.
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(4) Unless otherwise provided by the law requiring or permitting the deposit, each deposit shall be held in trust:
(a) first, for examination costs that an insurer has not paid under Section 31A-2-205;
[(a) first,](b) second, for administrative costs under Subsection 31A-27a-701(2)(a);
[(b) second,](c) third, for the claimants under Subsection 31A-27a-701(2)(c);
[(c) third,](d) fourth, for the claimants under Subsection 31A-27a-701(2)(d); and
[(d) fourth,](e) fifth, for all other creditors in the order of priority established under Section 31A-27a-701.
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(15)(a) Upon the depositor's request and upon approval of the commissioner, any deposit or part of a deposit shall be released to, or on order of, the depositor to the extent not needed to satisfy requirements of this title.
(b) On order of the commissioner after a hearing, a deposit or an appropriate part of the deposit shall be released to the commissioner to pay examination costs under Subsection (4)(a).
(c) On the order of a court of competent jurisdiction, the deposit or appropriate part of the deposit shall be released to the person for whom it is held.
Nature of change
Policy change: Under current law, a domestic insurer must pay the cost of being financially examined by the Department. Recently, an insurer under examination refused to pay. This caused extra work for the Department and delay of the exam. The proposed amendment provides that an insurer’s statutory deposit may be used to pay examination costs when an insurer does not pay.
Amendment text
31A-2-310.
(1) Service upon the commissioner or lieutenant governor under Section 31A-2-309 is service on the principal, if:
(a) [the following are] two copies of the process to be served and the required processing fee are delivered personally or to the office of the official designated in Section 31A-2-309[:
(i) two copies of the process to be served; and
(ii) a certificate of proof of service that meets the requirements of Subsection (3), dated and signed by the official designated in Section 31A-2-309; and]
(b) that official mails a copy of the process to the person to be served according to Subsection (2)(b).
(2)
(a) The commissioner and the lieutenant governor shall, if requested, give receipts for [and keep records of all] process served through them.
(b) The commissioner or the lieutenant governor shall keep a record of process served through them.
[(b)](c)(i) The commissioner or the lieutenant governor shall [immediately] send by certified mail [one]a copy of the process received to the person to be served at that person's last known principal place of business, residence, or post-office address.
(ii) The commissioner or the lieutenant governor shall retain [the other]a copy of the process [for his files] in a file.
(c) No plaintiff or complainant may take a judgment by default in any proceeding in which process is served under this section and Section 31A-2-309 until the expiration of 40 days from the date of service of process under Subsection (2)(b).
(3)(a) Proof of service shall be evidenced by a certificate by the official designated in Section 31A-2-309, showing service made upon him and mailing by him, and attached to a copy of the process presented to him for that purpose.
(b) A person seeking evidence of proof of service must prepare the certificate described in Subsection (3)(a) and obtain the signature of the official designated in Section 31A-2-309.
(4) When process is served under this section, the words "twenty days" in the first sentence of Rule 12(a) of the Utah Rules of Civil Procedure shall be changed to read "forty days."
Nature of change
Codifies practice: The amendments streamline the process for requesting substitute service of legal documents on insurance companies. The amendments also streamline the process that the commissioner and the lieutenant governor follow to transmit the documents to the insurer.
Amendment text
31A-2-404.
31A-2-404. Duties of the commissioner and Title and Escrow Commission.
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(6) The commissioner may make rules, in accordance with Title 63, Chapter 3, Utah Administrative Rulemaking Act, that govern the process for winding down the business of a resident agency title insurance producer.
Nature of change
Policy change: Currently, the law does not require an agency title insurance producer that ceases doing business to preserve access to its records. Because consumers and the Department sometimes need access to those records, the commissioner should be given authority to enact rules, in consultation with agency title insurance producers, to determine a process for assuring that records are accessible after an agency ceases to do business.
Amendment text
31A-3-102.
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(2)(c) a captive insurance company, except for a risk retention group, as provided in Section 31A-3-304 that pays a fee imposed under Section 31A-3-304.
Nature of change
Technical change: Current Utah law does not exempt risk retention groups from the requirement to pay an annual department fee. However, federal statute prohibits states from imposing this fee. The amendment exempts risk retention groups from Utah’s fee requirement for captive insurers.
Amendment text
31A-3-304.
(1)(a) A captive insurance company, other than a risk retention group, shall pay an annual fee imposed under this section to obtain or renew a certificate of authority.
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(5)(a) The commissioner shall deposit money received from a fee described in Subsection (3)(a) into the Captive Insurance Restricted Account.
(b) There is created in the General Fund a restricted account known as the "Captive Insurance Restricted Account."
(c) The Captive Insurance Restricted Account shall consist of the fees described in Subsection (3)(a).
(d) The commissioner shall administer the Captive Insurance Restricted Account. Subject to appropriations by the Legislature, the commissioner shall use the money deposited into the Captive Insurance Restricted Account to:
(i) administer and enforce:
(A) Chapter 37, Captive Insurance Companies Act; and
(B) Chapter 37a, Special Purpose Financial Captive Insurance Company Act; and
(ii) promote the captive insurance industry in Utah.
(e) An appropriation from the Captive Insurance Restricted Account is nonlapsing, except that at the end of each fiscal year, money received by the commissioner in excess of the legislative appropriation for the fiscal year that just ended shall be treated as free revenue in the General Fund:
(i) [for fiscal year 2025, in excess of $1,650,000; and
(ii) ]for fiscal year 2026[ and subsequent fiscal years], in excess of $1,668,500; and
(ii) for fiscal year 2027 and subsequent fiscal years, in excess of $1,687,500.
Nature of change
Technical change: Current Utah law does not exempt risk retention groups from the requirement to pay an annual department fee. However, federal statute prohibits states from imposing this fee. The amendment exempts risk retention groups from Utah’s fee requirement for captive insurers.
Policy change: The current version of this statute places a rigid cap on the payment of salaries, benefits and other items from the Captive Insurance Restricted Account. As a result, if the legislature appropriates money in the future for salary or benefit increases, the Department will not be able to pay those increases to the extent they result in an overall spending increase that exceeds the cap. The proposed amendment avoids this problem by raising the cap $19,000.
Amendment text
31A-4-113. Annual and quarterly statements.
(1)
(a) Each authorized insurer shall annually, on or before March 1, file with the commissioner and the NAIC a true statement of the authorized insurer's financial condition, transactions, and affairs as of December 31 of the preceding year.
(b) The statement required by Subsection (AIC)(a) shall be:
(i) verified by the oaths of at least two of the insurer's principal officers; and
(ii) in the general form and provide the information as prescribed by the commissioner by rule.
[(c) The commissioner may, for good cause shown, extend the date for filing the statement required by Subsection (1)(a).]
(2)(a) Each authorized insurer shall file with the commissioner and the NAIC a true statement of the insurer's financial condition, transactions, and affairs within 45 days following the close of the first, second and third quarters of a calendar year.
(b) The statement required by this Subsection shall be:
(i) verified by the oaths of at least two of the insurer's principal officers; and
(ii) in the general form and provide the information as prescribed by the commissioner by rule.
(3) The commissioner may, for good cause shown, extend the date for filing a statement required by this Section.
[(2)](4) The annual statement of an alien insurer shall:
(a) relate only to the alien insurer's transactions and affairs in the United States unless the commissioner requires otherwise; and
(b) be verified by:
(i) the insurer's United States manager; or
(ii) the insurer's authorized officers.
Nature of change
Codifies practice: The Department’s administrative rule requires a quarterly financial report from insurers. See r. 590-147-4. This amendment provides statutory authority for the requirement. Other state regulators uniformly require a quarterly financial report from insurers.
Amendment text
31A-4-113.5.
(1)
(a) Each domestic, foreign, and alien insurer who is authorized to transact insurance business in this state shall annually file with the NAIC a copy of the insurer's:
(i) annual statement convention blank on or before March 1;
(ii) market conduct annual statements on or before the applicable date determined by the NAIC; [and]
(iii) quarterly report required by Section 31A-4-113(2); and
[(iii)](iv) any additional filings required by the commissioner for the preceding year.
(b)
(i) The information filed with the NAIC under Subsection (1)(a)(i) and (iii) shall:
(A) be prepared in accordance with the NAIC's:
(I) annual statement instructions; and
(II) Accounting Practices and Procedures Manual; and
(B) include:
(I) the signed jurat page; and
(II) the actuarial certification.
(ii) An insurer shall file with the NAIC amendments and addenda to information filed with the commissioner under Subsection (1)(a)(i).
Nature of change
Codifies practice: The Department’s administrative rule requires a quarterly financial report from insurers. See r. 590-147-4. This amendment provides statutory authority for the requirement. State regulators uniformly require a quarterly financial report from insurers.
Amendment text
31A-5-420. Payment of dividends by mutual insurers and mutual insurance holding companies.
(1) When it is in the best interests of the company, the directors of a domestic mutual insurer or a domestic mutual insurance holding company shall declare, apportion, and pay to its members dividends from its net savings and earnings.
(2) The mutual insurer or mutual insurance holding company shall make a reasonable classification of its participating policies and its assumed risks. No dividend shall be paid that is inequitable, unfairly discriminates between classifications of insurance contracts, or unfairly discriminates between policies within the same classification.
(3) Unless stated in the policy, no dividend, otherwise earned, shall be contingent upon the payment of the renewal premium on any policy.
(4) Subsection (1) may not be construed to require an insurer or mutual insurance holding company determined by the United States Internal Revenue Service to be a nonprofit organization to pay a dividend in a manner which would jeopardize that status.
(5) At least 30 days prior to a dividend distribution, the mutual insurer or mutual insurance holding company shall file with the commissioner a schedule explaining the basis for the dividend distribution. The commissioner shall keep the schedule confidential unless the commissioner finds that the interests of insureds and public require that it be made public.
Nature of change
Codifies practice: Clarifies that the provisions regarding payment of dividends apply to mutual insurers and to mutual insurance holding companies.
Technical change: Adds a requirement that the insurer or holding company give pre-notification to the commissioner of a dividend distribution.
Amendment text
31A-16-111.
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(5)
(a) A director or officer of an insurance holding company system violates this chapter if the director or officer knowingly:
(i) participates in or assents to a transaction or investment that:
(A) has not been properly reported or submitted pursuant to:
(I) Subsections 31A-16-105(1) and (2); or
(II) Subsection 31A-16-106(1)(b); or
(B) otherwise violates this chapter; or
(ii) permits any of the officers or agents of the insurer to engage in a transaction or investment described in Subsection (5)(a)(i).
(b) [A director or officer in violation of Subsection (5)(a) shall pay, in the director's or officer's individual capacity, a civil penalty of not more than $20,000 per violation:
(i) upon a finding by the commissioner of a violation; and
(ii) after notice and hearing before the commissioner.]
Nature of change
Technical change: This penalty provision should be deleted because it contradicts a penalty provision in Section 31A-16-112. The contradiction is attributable to an oversight in enacting Subsection -112.
Amendment text
31A-18-117.
(1) [Except as provided in Subsection (2), the] The provisions of this chapter apply if there is a conflict between this chapter and another provision of state statute, except[.]:
[(2)](a) Chapter 16, Insurance Holding Companies, purporting to authorize an insurer to make a particular investment, supersedes this chapter[.]; and
(b) Chapter 37, Captive Insurance Companies Act, applies if there is a conflict between this chapter and Chapter 37.
[(3)](2) An insurer shall value the insurer's assets in accordance with the valuation standards of the NAIC to the extent those standards remain consistent with the statutes of this state or the rules or orders of the commissioner.
Nature of change
Technical change: When Chapter 18 was enacted during the last legislative session, the drafters overlooked the prior requirement that Tile 31A, Chapter 37 would govern to the extent it conflicted with Chapter 18. This amendment reinstates that requirement.
Amendment text
31A-21-310.
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(2) Section 31A-5-420 applies to member dividends paid by mutual insurers and mutual insurance holding companies.
Nature of change
Technical change: Clarifies that Section 31A-21-210 does not apply to dividend distributions by mutual insurers and mutual insurance holding companies and that Section 31A-5-420 does apply.
Amendment text
31A-22-309.
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(2)
(a) Any insurer issuing personal injury protection coverage under this part may only exclude from this coverage benefits:
(i) for any injury sustained by the insured while occupying another motor vehicle owned by or furnished for the regular use of the insured or a resident family member of the insured and not insured under the policy;
(ii) for any injury sustained by any person while operating the insured motor vehicle without the express or implied consent of the insured or while not in lawful possession of the insured motor vehicle;
(iii) to any injured person, if the person's conduct contributed to the person's injury:
(A) by intentionally causing injury to the person; or
(B) while committing a felony;
(iv) for any injury sustained by any person arising out of the use of any motor vehicle while located for use as a residence or premises;
(v) for any injury due to war, whether or not declared, civil war, insurrection, rebellion or revolution, or to any act or condition incident to any of the foregoing; [or]
(vi) for any injury resulting from the radioactive, toxic, explosive, or other hazardous properties of nuclear materials[.]or
(vii) for any injury sustained by any person arising from the use of the insured motor vehicle while it is being used to provide transportation network services, as defined in Title 13, Chapter 51, Transportation Network Company Registration Act.
(b) This Subsection (2) does not limit the exclusions that may be contained in other types of coverage.
Nature of change
Codifies practice: Section 13-51-108(5) currently says: "Nothing in this section requires a personal automobile insurance policy to provide coverage while a driver is providing transportation network services." The proposed amendment supports this statute by stating that an auto insurer may exclude PIP benefit coverage if a vehicle is providing network transportation services.
Amendment text
31A-22-505.
(1) An insurer may issue a group insurance policy offering life insurance to an association group or to the trustees of a fund established, created, and maintained for the benefits of the members of the association group, if: […]
Nature of change
Technical Change: The current statute requires that a policy for an association group be issued directly to the association. This change will allow the policy to be issued to trust that is maintained for the benefit of the association group.
Amendment text
31A-22-650.
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(5)(a) Each April 1, an insurer with a preauthorization requirement shall report to the department, for the previous calendar year, the percentage of authorizations, not including a claim involving urgent care as defined in 29 C.F.R. Sec. 2560.503-1, for which the insurer notified a provider regarding an authorization or adverse preauthorization determination more than one week after the day on which the insurer received the request for authorization.
(b) Before [March]April 1, 2026, and each [March]April 1 thereafter, an insurer shall report to the department the following for the previous calendar year: […]
Nature of change
Technical Change: Shifting the due date from March 1 to April 1 would eliminate confusion for insurers, and streamline processes within the Insurance Department, which will create efficiencies for insurers and the Department.
Amendment text
31A-22-701.
(1) A group insurance policy offering accident and health insurance may be issued to:
(a) a group:
(i) to which a group life insurance policy may be issued under Section 31A-22-502, 31A-22-503, 31A-22-504, 31A-22-505, 31A-22-506, 31A-22-507, or 31A-22-508[, or 31A-22-509]; and
(ii) that is formed and maintained in good faith for a purpose other than obtaining insurance; […]
Nature of change
Technical change: This amendment eliminates a redundancy in code. The subsection applies to life insurance so it is unnecessary to include Section31A-22-509 because it applies to life insurance.
Amendment text
31A-23a-204.
An individual title insurance producer or agency title insurance producer shall be licensed in accordance with this chapter, with the additional requirements listed in this section.
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(2)
(a) An individual title insurance producer or agency title insurance producer appointed by an insurer shall maintain:
(i) a fidelity bond; and
(ii) a professional liability insurance policy[; or
(iii) a financial protection:
(A) equivalent to that described in Subsection (2)(a)(i) or (ii); and
(B) that the commissioner considers adequate].
(b) The bond[,]and insurance[, or financial protection] required by this Subsection (2):
(i) shall be supplied under a contract approved by the commissioner to provide protection against the improper performance of any service, including escrow service, in conjunction with the issuance of a contract or policy of title insurance; and
(ii) be in a face amount no less than [$250,000]$500,000.
(c) The Title and Escrow Commission may by rule, subject to Section 31A-2-404, exempt individual title insurance producers or agency title insurance producers from the requirements of this Subsection (2) upon a finding that, and only so long as, the required policy or bond is generally unavailable at reasonable rates.
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(10)(a) If an agency title insurance producer becomes aware of facts supporting a reasonable belief that an electronic wire funds transfer related to a real estate or title insurance transaction did not reached its intended recipient, the producer shall report the facts to the commissioner and to all insurers with whom the producer has an appointment.
(b) The reporting requirement applies if:
(i) the producer initiated the transfer; or
(ii) the producer was the intended recipient of the transfer.
(c) Reports under Subsection (a) shall be made no later than seven (7) business days after the producer first becomes aware of the facts.
(d)(i) Except as stated in Subsection (d)(ii), a producer is immune from civil action, civil penalty, or damages if the producer makes a good faith report under this Subsection.
(ii) Immunity under this Subsection does not apply in a proceeding commenced by the department against a producer for the violation of an insurance law.
(e) The identity of a producer who makes a report under this subsection is protected under the Government Records Access and Management Act.
(11)(a) A title insurer shall report to the commissioner the termination of an appointment of a title insurance producer within seven days of termination.
(b) A title insurance producer shall report to the commissioner a title insurer’s termination of the title insurance producer’s appointment within 7 days of termination.
(c) The requirements of this Subsection are in addition to the requirements of Section 31A-23a-115.
[(10)](12)(a) The department may, in accordance with Title 63G, Chapter 4, Administrative Procedures Act, take [any of the following actions] an action in Subsection (b) against a title insurance producer if the title insurance producer:
(i) is conducting title insurance business without an appointment from a title insurer; or
(ii) [does not have] has not had an appointment for more than 28 days from a title insurer as described in Section 31A-23a-115[:].
(b) If the commissioner makes a finding under Subsection (a), the commissioner may:
[(a)](i) suspend or revoke the title insurance producer's license;
[(b)](ii) freeze a bank account associated with the title insurance producer's business;
[(c)](iii) subpoena the title insurance producer's records;
[(d)](iv) enjoin the title producer's business operations; or
[(e)](v) post, at the title producer's business location, a notice of an action listed in Subsections [(10)(a)] (11)(b)(i) through [(10)(d)](11)(b)(v).
Nature of change
Policy changes:
- The proposed amendments increase the amount of liability coverage that a title insurance producer must have.
- Under the proposed amendments, if an agency title insurance producer becomes aware of facts supporting a reasonable belief that an electronic wire funds transfer related to a real estate or title insurance transaction did not reach its intended recipient, the producer shall report the facts to the commissioner and to all insurers with whom the producer has an appointment. This allows the department and the insurer to take action to mitigate the potential loss of escrow funds.
- The proposed amendments require a title insurance producer to notify the department of the termination of its appointment to write business for a title insurer. Because producers without appointments sometimes violate the law and defraud consumers, the Department should be notified of the termination so that it can monitor the producer and take appropriate regulatory action.
Amendment text
31A-23a-406.
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(2) An individual title insurance producer or agency title insurance producer may do escrow involving real property transactions if all of the following exist:
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(d) money deposited with the individual title insurance producer or agency title insurance producer in connection with any escrow is deposited:
(i) in a federally insured depository institution, as defined in Section 7-1-103, that:
(A) has a branch in this state[, if the individual title insurance producer or agency title insurance producer depositing the money is a resident licensee]; and
(B) is authorized by the depository institution's primary regulator to engage in trust business, as defined in Section 7-5-1, in this state; and
(ii) in a trust account that is separate from all other trust account money that is not related to real estate transactions;
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(i) the individual title insurance producer or agency title insurance producer shall maintain a physical office in Utah staffed by a person with an escrow subline of authority who processes the escrow[.]; and
(j) the individual title insurance producer or agency title insurance producer shall, on receiving an order for a policy of title insurance, notify the parties to the real estate transaction of availability, cost, and protections available from a closing protection letter described in Section 31A-4-117.
Nature of change
Policy changes:
- The current statute states that only resident title insurance producers must deposit Utah homebuyers’ escrow money in a depository institution’s Utah branch. The proposed amendment will impose this requirement on nonresident title insurance agencies as well. The change will enable the Department to more easily freeze a trust account of non-resident agencies in cases of suspected fraud. Additionally, it will keep a homebuyer’s escrow money in Utah where it can be more easily accessed through the legal process in the event of a dispute.
- A closing protection letter protects consumers from losses of funds during the closing of a real estate transaction. The amendment requires a title insurance producer to notify a consumer of the terms, cost and protections of a closing protection letter.
Amendment text
31A-23a-409.
*****
(2) Money required to be deposited under Subsection (1) shall be deposited:
(a) into a federally insured trust account in a depository institution, as defined in Section 7-1-103, which:
(i) has a branch in this state, if the [individual title insurance producer or agency title insurance producer] licensee depositing the money is a resident licensee;
(ii) has federal deposit insurance; and
(iii) is authorized by its primary regulator to engage in the trust business, as defined by Section 7-5-1, in this state; or
(b) into some other account, that:
(i) the commissioner approves by rule or order; and
(ii) provides safety comparable to an account described in Subsection (2)(a).
(c) This Subsection (2) does not apply to title insurance licensees.
Nature of change
Codifies practice: The proposed amendments establish that Subsection (2) of this statute does not apply to title insurance licensees.
Amendment text
31A-23a-501.
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(4)[(a) For purposes of this Subsection (4):
(i) “Large customer” means an employer who, with respect to a calendar year and to a plan year:
(A) employed an average of at least 100 eligible employees on each business day during the preceding calendar year; and
(B) employs at least two employees on the first day of the plan year.
(ii) “Producer” includes:
(A) a producer;
(B) an affiliate of a producer; or
(C) a consultant.
(b) A producer may not accept or receive any compensation from an insurer or third party administrator for the initial placement of a health benefit plan, other than a hospital confinement indemnity policy, unless prior to a large customer’s initial purchase of the health benefit plan the producer discloses in writing to the large customer that the producer will receive compensation from the insurer or third party administrator for the placement of insurance, including the amount or type of compensation known to the producer at the time of the disclosure.
(c) A producer shall:
(i) obtain the large customer’s signed acknowledgment that the disclosure under Subsection (4)(b) was made to the large customer; or
(ii)(A) sign a statement that the disclosure required by Subsection (4)(b) was made to the large customer; and
(B) keep the signed statement on file in the producer’s office while the health benefit plan placed with the large customer is in force.
(d) A licensee who collects or receives any part of the compensation from an insurer or third party administrator in a manner that facilitates an audit shall, while the health benefit plan placed with the large customer is in force, maintain a copy of:
(i) the signed acknowledgment described in Subsection (4)(c)(i); or
(ii) the signed statement described in Subsection (4)(c)(ii).
(e) Subsection (4)(c) does not apply to:
(i) a person licensed as a producer who acts only as an intermediary between an insurer and the customer’s producer, including a managing general agent; or
(ii) the placement of insurance in a secondary or residual market.
(f)(i) A producer shall provide to a large customer listed in this Subsection (4)(f) an annual accounting, as defined by rule made by the department in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, of all amounts the producer receives in commission compensation from an insurer or third party administrator as a result of the sale or placement of a health benefit plan to a large customer that is:
(A) the state;
(B) a political subdivision or instrumentality of the state or a combination thereof primarily engaged in educational activities or the administration or servicing of educational activities, including the State Board of Education and its instrumentalities, an institution of higher education and its branches, a school district and its instrumentalities, a vocational and technical school, and an entity arising out of a consolidation agreement between entities described under this Subsection (4)(f)(i)(B);
(C) a county, city, town, special district under Title 17B, Limited Purpose Local Government Entities - Special Districts, special service district under Title 17D, Chapter 1, Special Service District Act, an entity created by an interlocal cooperation agreement under Title 11, Chapter 13, Interlocal Cooperation Act, or any other governmental entity designated in statute as a political subdivision of the state; or
(D) a quasi-public corporation, that has the same meaning as defined in Section 63E-1-102.
(ii) The department shall pattern the annual accounting required by this Subsection (4)(f) on the insurance related information on Internal Revenue Service Form 5500 and its relevant attachments.
(g) At the request of the department, a producer shall provide the department a copy of:
(i) a disclosure required by this Subsection (4); or
(ii) an Internal Revenue Service Form 5500 and its relevant attachments.
(5)] This section does not alter the right of any licensee to recover from an insured the amount of any premium due for insurance effected by or through that licensee or to charge a reasonable rate of interest upon past-due accounts.
[(6)](5) This section does not apply to bail bond producers or bail enforcement agents as defined in Section 31A-35-102.
[(7)](6) A licensee may not receive noncommission compensation from an insurer, insured, or enrollee for providing a service or engaging in an act that is required to be provided or performed in order to receive commission compensation, except for the surplus lines transactions that do not receive commissions.
Nature of change
Policy change: The repeal of Subsection (4) removes duplicate reporting. In addition to the compensation disclosure in the U.S. Department of Labor's Form 5500, the recently passed Consolidated Appropriations Act of 2021 enhanced the reporting for all employer groups where compensation is expected to be more than $1,000. The new federal reporting requirements include and expand what is required under 31A-23a-501(4).
Amendment text
31A-26-301.6.
(2) An insurer shall timely pay every valid insurance claim submitted [by a provider] in accordance with this section.
Nature of change
Technical change: Provides clarification that an insurer shall timely pay all claims, including those submitted by the insured, not just the provider.
Amendment text
31A-26-401. [Required contracts] Contracts.
(1)(a) A public adjuster may not, directly or indirectly, act within this state as a public adjuster without having first entered into a contract, in writing, on a form filed with the department in accordance with Section 31A-21-201, executed in duplicate by the public adjuster and the insured or the insured's duly authorized representative. [A public adjuster may not use a form of contract that is not filed with the department.]
(b) A signed copy of the contract shall be provided to the insured at the time of signing.
(c) A public adjuster may not use a form of contract that is not filed with the department.
(d) Compensation provisions may not be redacted from a contract form filed with the department.
(2)(a) A contract described in Subsection (1) may be rescinded[is subject to recision] in accordance with Section 31A-26-311.
(b) If an insured rescinds the contract, anything of value given by the insured under the contract shall be returned to the insured within fifteen business days following the public adjuster’s receipt of a rescission notice.
(3)
[(a) A contract described in Subsection (1) shall include a prominently displayed notice in 12-point boldface type that states "WE REPRESENT THE INSURED ONLY."
(b) The commissioner by rule, made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, may require additional prominently displayed notice requirements in the contract as the commissioner considers necessary.]A contract described in Subsection (1) shall include notices and statements that the commissioner considers necessary as established by rule in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
(4) A contract described in Subsection (1) may not include a term that:
(a) Allows the public adjuster’s percentage fee to be collected when money is due from an insurance company but not paid;
(b) Allows a public adjuster to collect the entire fee from the first check issued by an insurance company rather than as percentage of each check issued by an insurance company;
(c) Requires the insured to authorize an insurance company to issue a check only in the name of the public adjuster;
(d) Imposes collection costs or late fees; or
(e) Prevents an insured from pursuing a civil remedy.
(5)(a) A public adjuster shall provide to the insurer a notification letter, which has been signed by the insured, authorizing the public adjuster to represent the insured’s interest.
(b) After receiving the notification letter, the insurer shall verify with the Department that the public adjuster holds a valid license
[(4) A public adjuster shall keep at the public adjuster's principal place of business a copy of each contract entered into in this state for the current year plus three years, and each contract shall be available at all times for inspection, without notice, by the commissioner or the commissioner's authorized representative.]
Nature of change
Policy change: The proposed amendments to this statute update the requirements for the contents of an insured’s contract with a public adjuster. The updated requirements are taken from the National Association of Insurance Commissioners’ Public Adjuster Licensing Model Act passed March 26, 2025.
Amendment text
31A-26-402.
(1) Except as provided by Subsection (2), a public adjuster may receive compensation for service provided under this chapter consisting of an hourly fee, a flat rate, a percentage of the total amount paid by an insurer to resolve a claim, or another method of compensation.
(a) If the public adjuster will be compensated at an hourly rate, the contract shall state the hourly rate and how it will be applied to hours of service provided by the public adjuster to calculate the amount payable.
(b) If the public adjuster will be compensated on a flat fee basis, the contract shall state the amount payable to the public adjuster.
(c) If the public adjuster will be compensated on a percentage basis, the contract shall state the exact percentage that will be applied to the settlement of the claim to calculate the amount payable to the public insurance adjuster.
(d) If another method of calculation will be used to determine compensation, the contract shall include a detailed explanation of how the amount payable will be determined based on service provided by the public adjuster.
(e) The contract shall state the type, with dollar estimates, of initial expenses approved by the insured to be reimbursed to the public adjuster from the proceeds of the claim payment.
(f) An itemized invoice shall be provided to the insured at the conclusion of the claim.
(2)
(a) A public adjuster may not receive a compensation consisting of a percentage of the total amount paid by an insurer to resolve a claim on a claim on which the insurer, not later than 72 hours after the date on which the loss is reported to the insurer, either pays or commits in writing to pay to the insured the policy limit of the insurance policy.
(b) Subject to Subsection (7), [A]a public adjuster is entitled to reasonable compensation from the insured for services provided by the public adjuster on behalf of the insured, based on the time spent on a claim that is subject to this Subsection (2) and expenses incurred by the public adjuster, until the claim is paid or the insured receives a written commitment to pay from the insurer.
(3) Except for the payment of compensation by the insured, a person paying proceeds of a policy of insurance or making a payment affecting an insured's rights under a policy of insurance shall:
(a) include the insured as a payee on the payment draft or check; and
(b) require the written signature and endorsement of the insured on the payment draft or check.
(4)(a) A public adjuster may not accept any payment that violates this section notwithstanding written authorization [whether] the insured gives [authorization] to the public adjuster.
(b) A public adjuster may not sign and endorse any payment draft or check on behalf of an insured.
(5) A public adjuster may not charge, agree to or accept as compensation or reimbursement any payment, commission, fee, or another thing of value equal to more than:
(a) ten percent for a catastrophic insurance claim settlement; or
(b) fifteen percent for a non catastrophic insurance claim settlement.
(6) A public adjuster may not require, demand or accept a fee, retainer, compensation, deposit, or other thing of value prior to settlement of a claim.
Nature of change
Policy change: The proposed amendments to this statute are an attempt to place all current provisions concerning compensation for public adjusters in one statute. The only new provisions are taken from the National Association of Insurance Commissioners’ Public Adjuster Licensing Model Act passed March 26, 2025. They limit compensation to:
- ten percent for any catastrophic insurance claim settlement; or
- fifteen percent for any insurance claim settlement.
Those limits protect the insured by assuring that the recovered amount will pay for necessary repairs. In some cases, those repairs are needed to meet safety and habitability standards or maintain insurance coverage.
Amendment text
31A-26-403. [Rulemaking]Assignment of property insurance policy rights and benefits.
(1) A property insurance policy may expressly prohibit assignment of rights and benefits under the policy to a property repair contractor, roofing company, disaster clean up company, appraiser, inspector or other person hired to remedy the damage that is the subject of the insured’s claim.
(2) The prohibition in Subsection (1) may not be circumvented by obtaining a power of attorney from an insured.
(3) A property insurance policy may not prohibit assignment of rights and benefits under the policy to a public adjuster.
Nature of change
Codifies practice: The proposed amendments contain requirements on assignment of policy rights that the Department currently enforces.
Amendment text
31A-26-404. Funds held by public adjuster.
A public adjuster who receives, accepts or holds funds on behalf of an insured shall deposit the funds in a trust account in a federally insured depository institution that:
(1)(a) has a branch in this state, if the public adjuster depositing the money is a resident licensee;
(b) has a branch in the public adjuster’s home state, if the public adjuster is a nonresident licensee; or
(c) has a branch where the loss occurred; and
(2) is authorized by the depository institution's primary regulator to engage in trust business.
Nature of change
Policy change: The proposed statute creates new requirements that protect an insured’s money when it is held by a public adjuster. The requirements are taken from the National Association of Insurance Commissioners’ Public Adjuster Licensing Model Act passed March 26, 2025.
Amendment text
31A-26-405. Public adjuster standards of conduct.
(1) A public adjuster may not:
(a) Solicit, or attempt to solicit, an insured during the progress of a loss-producing occurrence;
(b) Advertise or infer damage unless an inspection of the property has been completed;
(c) Offer to pay an insured’s deductible, or claim the insured’s deductible will be waived, as an inducement to using the services of a public adjuster;
(d) Offer conduct a free inspection of property other than property that is the subject of an insured’s claim;
(d) Participate, directly, indirectly or through an affiliate, in the reconstruction, repair or restoration of property that is the subject of the public adjuster’s contract with an insured;
(e) Solicit, accept compensation from, or have an interest in a business that provides products or services in connection with a claim that the public adjuster has a contract to adjust;
(f) Have a financial interest in, directly, indirectly or through an affiliate, any aspect of an insured’s claim except for a salary, fee, commission or other compensation established in the written contract with the insured.
(g) Collect compensation as provided in a contract without actually performing the service customarily provided by a licensed public adjuster for the insured;
(i) Acquire an interest in salvage of property except as authorized in a contract with the insured.
(j) Recommend or direct that the insured obtain repairs or services in connection with a loss from a person:
(i) In whom the public adjuster has a financial interest; or
(ii) From whom the public adjuster may receive direct or indirect compensation for the referral;
(k) Accept, sign or endorse a check or payment draft that does not name the insured as a payee;
(l) Accept, sign or endorse a check or payment draft on behalf of the insured;
(m) Adjust a claim if the terms and conditions of the insurance coverage exceed the the public adjuster’s competence, knowledgeable or expertise;
(n) Represent or act as a company adjuster or independent adjuster on the same claim;
(o) Enter into a contract or accept a power of attorney that vests in the public adjuster the effective authority to choose the persons who shall perform repair work;
(p) Agree to any loss settlement without the insured’s knowledge and consent; or
(q) Allow the following to obtain an insured’s signature on the public adjuster’s contract:
(i) a home repair contractor;
(ii) a roofing company;
(iii) a disaster clean up company;
(iv) an appraiser;
(v) an inspector; or
(vi) any other person hired to remedy the damage that is the sublect of the insured’s claim.
Nature of change
Policy change: This proposed statute collects public adjuster standards of conduct from current law and from the National Association of Insurance Commissioners’ Public Adjuster Licensing Model Act passed March 26, 2025. The standards are primarily designed to prevent a public adjuster from:
- unfairly inducing an insured to retain a public adjuster; and
- profiting from the repair of property involved in a claim that the public adjuster has adjusted.
Amendment text
31A-26-406. Record retention requirements.
(1) A public insurance adjuster adjuster shall keep at its address registered with the commissioner a record of each investigation, adjustment or transaction undertaken or consummated consummated under the insurance adjuster’s license.
(2) The record shall include:
(a) the name of the insured;
(b) the date, location and amount of the loss;
(c) a copy of the contract between the public adjuster and insured;
(d) the name of the insurer, amount, expiration date and number of each policy carried with respect to the loss;
(e) an itemized statement of the insured’s recoveries;
(f) an itemized statement of all compensation received by the public adjuster, from any source whatsoever, in connection with the loss;
(g) a register of all monies received, deposited, disbursed, or withdrawn in connection with a transaction with an insured, including fees transfers and disbursements from a trust account and all transactions concerning all interest-bearing accounts;
(h) the name of public adjuster who executed the contract;
(i) the name of the attorney representing the insured, if applicable, and the name of the claims representatives of the insurance company; and
(j) evidence that the public adjuster meets statutory financial responsibility requirements.
Nature of change
Technical change: The proposed statute creates new requirements for records retention by a public adjuster. The requirements are taken from the National Association of Insurance Commissioners’ Public Adjuster Licensing Model Act passed March 26, 2025.
Amendment text
[31A-26-403.]31A-26-407. Rulemaking.
The commissioner may make rules, in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
(1) addressing the forms required by this part;
(2) providing for notice requirements in contracts; and
(3) establishing the scope of a contract a public adjuster enters into with an insured that the public adjuster represents.
Nature of change
Technical change
Amendment text
Chapter 27 [Delinquency Administrative Action Provisions Part 5 Administrative Actions]Administrative Supervision of Insurers
Nature of change
Technical change
Amendment text
31A-27-501. [Title --] Applicability -- Construction -- Commissioner's powers.
(1) [This chapter is known as the "Delinquency Administrative Action Provisions."
(2)] The proceedings authorized by this part may be applied to:
(a) all insurers and reinsurers:
(i) who are doing, or have done, an insurance business in this state; and
(ii) against whom claims arising from that business may exist;
(b) all insurers who have the appearance of or claim they do an insurance business in this state;
(c) all insurers who have insureds resident in this state; and
(d) all other persons organized or in the process of organizing to do an insurance business as an insurer in this state.
(3) This part shall be liberally construed to protect the interests of insureds, creditors, and the public generally, with minimum interference with the normal prerogatives of owners, through:
(a) early detection of any potentially dangerous condition in an insurer;
(b) prompt application of appropriate regulatory corrective measures; and
(c) regulation of the insurance business by law relating to insolvency of insurers and by substantive rules on the entire insurance business.
(4) This part does not limit the powers granted the commissioner by other provisions of law.
Nature of change
Technical change
Amendment text
31A-27-503.
(1)
(a) The commissioner may take an action described in Subsection (1)(b) [whenever]if, after conducting a proceeding in accordance with the Administrative Procedures Act, Title 63G, Chapter 4, the commissioner [has reasonable cause to believe, and ]determines [after a hearing] that an insurer:
(i) has committed or engaged in an act, practice, or transaction that would subject the insurer to a formal delinquency proceeding under Chapter 27a, Insurer Receivership Act;
(ii) is committing or engaging in an act, practice, or transaction that would subject the insurer to a formal delinquency proceeding under Chapter 27a, Insurer Receivership Act;
(iii) is about to commit or engage in an act, practice, or transaction that would subject the insurer to a formal delinquency proceeding under Chapter 27a, Insurer Receivership Act;
(iv) is in or is about to be in a condition that would subject the insurer to a formal delinquency proceeding under Chapter 27a, Insurer Receivership Act; or
(v) is in hazardous financial condition or potentially hazardous financial condition, as defined by rule made under Subsection 31A-27a-101(3)(c).
(vi) has refused to permit examination of its books, papers, accounts, records or affairs by the commissioner, his or her deputies, employees or duly commissioned examiners;
(vii) has unlawfully removed from this state books, papers, accounts or records necessary for an examination of the insurer;
(viii) has failed to promptly comply with the applicable financial reporting statutes or rules and departmental requests relating thereto;
(ix) has neglected or refused to observe an order of the commissioner to make good, within the time prescribed by law, any prohibited deficiency in its capital, capital stock or surplus;
(x) is continuing to transact insurance or write business after its license has been revoked or suspended by the commissioner;
(xi) has, by contract or otherwise, unlawfully, in violation of an order of the commissioner or without first having obtained written approval of the commissioner if approval is required by law:
(A) Totally reinsured its entire outstanding business, or
(B) Merged or consolidated substantially its entire property or business with another insurer;
(xii) has engaged in any transaction in which it is not authorized to engage under the laws of this state; or
(xiii) has refused to comply with a lawful order of the commissioner.
(b) If the conditions of Subsection (1)(a) are met, the commissioner may:
(i) issue mandatory or prohibitory orders[make and serve upon the insurer and any other necessary persons whose action or forbearance from action is reasonably necessary, those orders, other than a seizure order under Section 31A-27a-201,] that are reasonably necessary to correct, eliminate, or remedy the act, practice, transaction, or condition described in Subsection (1)(a)[.]; or
[(c)](ii) [The commissioner may ]issue an order for the insurer to submit to ]place the insurer under administrative supervision [by a supervisor appointed by the commissioner] until the act, practice, transaction, or condition that is the ground for the order has been halted or corrected.
(iii) The commissioner may appoint an independent contractor to serve as a supervisor.
[(2)
(a) The commissioner may make and serve an order issued under Subsection (1) without notice and before a hearing if:
(i) the conditions of Subsection (1) are satisfied; and
(ii) it appears to the commissioner that irreparable harm to the property or business of the insurer or to the interests of its policyholders, creditors, or the public may occur unless the commissioner issues, with immediate effect, the order.
(b) The commissioner shall serve the insurer with an order described in this Subsection (2) and a notice of agency action, containing a statement of the reasons why irreparable harm is threatened unless the order is issued with immediate effect.]
(3)
[(a) If the commissioner issues an order for supervision of an insurer under Subsection (1) or (2), the commissioner shall:
(i) notify the insurer that the insurer is under the supervision of the commissioner; and
(ii) explain the reasons for that supervision.
(b)] During [the period of ]supervision, the commissioner may prohibit the insurer from doing any of the following, without the prior approval of the commissioner or a supervisor appointed by the commissioner:
(i) transferring any of its assets or its business in force;
(ii) withdrawing funds from any of its bank accounts;
(iii) lending any of its funds;
(iv) investing any of its funds;
(v) transferring any of its property;
(vi) incurring any debt, obligation, or liability other than in the ordinary and usual course of business; or
(vii) entering into any new reinsurance contract or treaty.
(viii) Merge or consolidate with another company;
(ix) Approve new premiums or renew any policies;
(x) Terminate, surrender, forfeit, convert or lapse any insurance policy, certificate or contract, except for nonpayment of premiums due:
(xi) Release, pay or refund premium deposits, accrued cash or loan values, unearned premiums, or other reserves on any insurance policy, certificate or contract;
(xii) Make any material change in management; or
(xiii) Increase salaries and benefits of officers or directors or the preferential payment of bonuses, dividends or other payments deemed preferential.
[(b)](4) A supervisor appointed by the commissioner:
(a) is an independent contractor under Sections 31A-2-204 and 31A-2-205; and
(b) shall be paid in the same manner as an independent contractor under Section 31A-2-205.
[(4)
(a) If the commissioner issues a summary order before a hearing under Subsection (2), the insurer may waive the commissioner's hearing and apply for immediate judicial relief by any remedy afforded by law, without first exhausting the insurer's administrative remedies.
(b) If the insurer has a hearing before the commissioner, the insurer and any person whose interests are substantially affected are entitled to judicial review of any order issued by the commissioner.]
Nature of change
Policy change: The authors of the current statute created a process for administrative supervision of insurers that did not account for the process required by the Utah Administrative Procedures Act (UAPA). The proposed amendments make it clear that UAPA provides the governing process for administrative supervision.
The amendments also: (a) clarify language that is difficult to understand; and (b) adopt from the NAIC Administrative Supervision Model Act provisions that identify additional grounds for administrative supervision and additional supervisory powers.
Amendment text
31A-27-504. [Conduct of hearings.] Confidentiality; duty to deliver records.
(1) A proceeding [The commissioner shall hold a hearing conducted] under Section 31A-27-503 is confidential[privately] unless the insurer requests that the proceeding be public[a public hearing].
(2) All records of the insurer, other documents, and all department files and papers[,] that are relevant to a [so far as they pertain to or are a part of the record of a hearing] proceeding conducted under Section 31A-27-503[,] shall be kept confidential:
(a) except as is necessary to obtain compliance with the commissioner’s order [a hearing conducted under Section 31A-27-503]; or
(b) the proceeding is public [unless the insurer requests that the matter be made public].
(3) [Any] A person having possession or custody of and refusing to deliver [any of ]the records described in Subsection (2) is [of an insurer against which an order is issued by the commissioner is in accordance with a hearing conducted under Section 31A-27-503 ]subject to penalty under Section 31A-2-308.
Nature of change
Codifies practice: The proposed amendments clarify the language and make it more concise but to do not change the meaning.
Amendment text
31A-28-201. Title.
This part is known as the "Utah Property and Casualty Insurance Guaranty Association Act."
Nature of change
Technical change
Amendment text
31A-28-203.
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(4)(b) "Covered claim" does not include:
*****
(v) a claim by or against an insured of an insolvent insurer, if such insured has a net worth of more than twenty-five million dollars on the date on which the insurer became an insolvent insurer or became subject to an order of liquidation.
Nature of change
TBD
Amendment text
31A-37-102.
*****
(10)
(a) "Captive insurance company" means the same as that term is defined in Section 31A-1-301.
(b) "Captive insurance company" includes any of the following formed or holding a certificate of authority under this chapter:
(i) an agency captive insurance company;
(ii) [a branch]an association captive insurance company;
(iii) a [pooling]branch captive insurance company;
(iv) [a pure]an industrial insured captive insurance company;
(v) [an association]pooling captive insurance company;
(vi) a [sponsored]pure captive insurance company;
(vii) [an industrial insured captive insurance company, including an industrial insured captive insurance company formed as] a risk retention group [captive]formed in this state [pursuant to the provisions of the Federal Liability Risk Retention Act of 1986]that is:
(A) created under the Federal Product Liability Risk Retention Act of 1981, 15 U.S.C. Sec. 3901 et seq., as amended, as a corporation or other limited liability association; and
(B) taxable under this title as a stock corporation or mutual insurer;
(viii) a [special purpose]sponsored captive insurance company; [or]
(ix) a special purpose [financial] captive insurance company[.]; or
(x) a special purpose financial captive insurance company.
*****
(16) "Controlled unaffiliated business" means a business entity:
(a)(i) in the case of a [pure] captive insurance company, other than a risk retention group, that is not in the corporate or limited liability company system of a parent or the parent’s affiliate; or
*****
(b)(i) in the case of a [pure] captive insurance company, other than a risk retention group, that has a contractual relationship with a parent or affiliate; or
*****
(c) whose risk that are or will be insured by a [pure] captive insurance company, [an industrial insured captive insurance company, or both] other than a risk retention group, are managed in accordance with Subsection 31A-37-106(1)(j) by:
(i)(A) a [pure] captive insurance company; or
(B) an industrial insured captive insurance company; or
(ii) a parent or affiliate of:
(A) a [pure] captive insurance company; or
(B) an industrial insured captive insurance company.
*****
(23) "Industrial insured group" means: […]
(a)(ii) have complete voting control over an industrial insured captive insurance company incorporated or organized as a limited liability company as mutual insurer; or
(b) [a group that is:
(i) created under the Product Liability Risk Retention Act of 1981, 15 U.S.C. Sec. 3901 et seq., as amended, as a corporation or other limited liability association; and
(ii) taxable under this title as a:
(A) stock corporation; or
(B) mutual insurer; or
(c)] a group that has complete voting control over an industrial captive insurance company formed as a limited liability company.
Nature of change
Technical changes: Reorganizing and clarifying definitions. Correcting mistaken treatment of an industrial insured captive as a risk retention group.
Amendment text
31A-37-103.
*****
(4) In addition to this chapter, [an industrial group captive insurance company formed as ]a risk retention group [captive] is subject to Chapter 15, Part 2, Risk Retention Act, to the extent that this chapter is silent regarding regulation of risk retention groups conducting business in the state.
Nature of change
Technical change: Clarifying applicability of other laws to risk retentions groups. Correcting mistaken treatment of an industrial insured captive as a risk retention group.
Amendment text
31A-37-201.
*****
(5)(c) This Subsection (5) does not apply to information provided by [an industrial insured captive insurance company insuring the risks of an industrial insured]a risk retention group formed or operating in the state.
Nature of change
Technical change: Clarifying applicability of other laws to risk retentions groups. Correcting mistaken treatment of an industrial insured captive as a risk retention group.
Amendment text
31A-37-204.
*****
(2)(a) The commissioner may not issue a certificate of authority to a captive insurance company [described in Subsection (2)(c)] unless the company possesses and maintains unimpaired paid-in capital and unimpaired paid-in surplus of:
*****
(iii) in the case of an industrial insured captive insurance company [incorporated as a stock insurer] or a risk retention group, not less than $700,000;
*****
[(c) This Subsection (2) applies to:(i) a pure captive insurance company;
(ii) a sponsored captive insurance company;
(iii) a special purpose captive insurance company;
(iv) an association captive insurance company; or
(v) an industrial insured captive insurance company.]
Nature of change
Technical change: Clarifying applicability of capital requirements to industrial insured captive insurers and risk retention groups.
Amendment text
31A-37-302.
(1)(a) Except as provided in Subsection (1)(b), a captive insurance company and [an industrial insured captive insurance company] a risk retention group shall comply with the investment requirements contained in this title.
(b) Notwithstanding Subsection (1)(a) and any other provision of this title, the commissioner may approve the use of alternative reliable methods of valuation and rating under Section 31A-37-106 for a captive insurance company or [an industrial insured captive insurance company] a risk retention group.
(2)(a) Except as provided in Subsection (2)(b), a [pure] captive insurance company[ or industrial insured captive insurance company] other than a risk retention group, is not subject to any restrictions on [allowable] authorized classes of investments described in Section 31A-18-[108]110.
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(4) If a captive [insurer]insurance company, other than a risk retention group, has [excess] surplus [above the] exceeding an amount more than 20% above the sum of its minimum capital required by Section 31A-37-204 plus its actuarially determined reserve estimate, the captive insurer may invest [the captive insurer’s] this excess surplus in a manner inconsistent with the authorized classes of investments described in Section 31A-18-110 with prior written approval of the commissioner.
Nature of change
Technical change:
- Corrects the misapplication of investment requirements to industrial insured captive insurers and applies those requirements to risk retention groups.
- Clarifying language placed in Subsection (2)(a).
Policy change: The proposed amendment in Subsection (4) redefines a captive insurer’s excess surplus and thereby increases the amount of reserves that are set aside to pay an insurer’s obligations.
Amendment text
31A-37-501.
(c) Except as otherwise provided:
(i) a licensed captive insurance company shall file the report required by Section 31A-4-113; and
(ii) [an industrial insured] a risk retention group shall comply with Section 31A-4-113.5.
Nature of change
Technical change: Corrects mistaken treatment of an industrial insured captive as a risk retention group.
Amendment text
31A-37-505.
(1) The commissioner may suspend or revoke the certificate of authority of a captive insurance company to conduct an insurance business in this state for:
(a) insolvency or impairment of capital or surplus;
(b) failure to meet the requirements of [Section 31A-37-204]Part 2 of this Chapter;
Nature of change
Policy change: Currently, the law does not authorize the commissioner to take action against captive insurers that:
- conduct insurance business in unauthorized areas;
- no longer meet requirements of a certificate of authority to do business in Utah; and
- do not continue to meet capital requirements.
The amendment permits the commissioner to enforce those requirements.
Amendment text
31A-37-701.
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(2)(a) A captive insurance company, other than [an industrial insured captive insurance company] a risk retention group or a cell of a sponsored captive insurance company, is eligible for a certificate of dormancy if the company:
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(4)(a) shall possess and maintain unimpaired paid-in capital and unimpaired paid-in surplus of[:] at least 10% of the minimum required and as applicable to the captive insurance company in Section 204; and […]
Nature of change
Technical change:
- Correcting mistaken treatment of an industrial insured captive as a risk retention group.
- Restates method of calculating capital requirement.
Amendment text
31A-41-202.
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(3)
(a) To be licensed as an agency title insurance producer, a person shall pay to the department an assessment of $1,000 before the day on which the person is licensed as a title insurance agency.
(b)
(i) The department shall assess on a licensed agency title insurance producer an amount equal to the greater of:
(A) $1,000; or
(B) subject to Subsection (3)(b)(ii), 2% of the balance in the agency title insurance producer's reserve account described in Subsection 31A-23a-204(3).
(ii) The department may assess on an agency title insurance producer an amount less than 2% of the balance described in Subsection (3)(b)(i)(B) if:
(A) before issuing the assessments under this Subsection (3)(b) the department determines that the total of all assessments under Subsection (3)(b)(i) will exceed $250,000;
(B) the amount assessed on the agency title insurance producer is not less than $1,000; and
(C) the department reduces the assessment in a proportionate amount for agency title insurance producers assessed on the basis of the 2% of the balance described in Subsection (3)(b)(i)(B).
(iii) An agency title insurance producer assessed under this Subsection (3)(b) shall pay the assessment by no later than August [1]31.
Nature of change
Technical change: The proposed amendment changes a date in order to coordinate with other deadlines that a title insurance licensee must comply with.