(a) Any foreign insurer not subject to a substantially similar RBC law in its domicile, shall submit to the commissioner an RBC report on or before March 15, for the preceding calendar year. Any other foreign insurer shall, upon the written request of the commissioner, submit to the commissioner an RBC report as of the end of the calendar year just ended by the later of:
(i) The date an RBC report would be required to be filed by a domestic insurer under this article; or
(ii) Fifteen (15) days after the request is received by the foreign insurer.
(b) Any foreign insurer shall, at the written request of the commissioner, within fifteen (15) business days submit to the commissioner a copy of any RBC plan that is filed with the insurance commissioner of any other state.
(c) Pursuant to regulations adopted by the commissioner, in the event of a company action level event, regulatory action level event or authorized control level event, the commissioner may require the foreign insurer to file an RBC plan with the commissioner. In such event, the failure of the foreign insurer to file an RBC plan with the commissioner shall be grounds to order the insurer to cease and desist from writing new insurance business in this state.
(d) In the event of a mandatory control level event with respect to any foreign insurer, if no domiciliary receiver has been appointed with respect to the foreign insurer under the rehabilitation and liquidation statute applicable in the state of domicile of the foreign insurer, the commissioner may make application for the appointment of a receiver to the district court of Laramie county as permitted under chapter 28 of this code. The occurrence of the mandatory control level event shall be considered adequate grounds for the application.
All notices by the commissioner to an insurer which may result in regulatory action under this article shall be effective upon mailing if transmitted by registered or certified mail, or in the case of any other transmission shall be effective upon the insurer's receipt of the notice.
(a) For RBC reports required to be filed by life or disability insurers with respect to 1994, the following requirements shall apply in lieu of the provisions of W.S. 26-48-103 through 26-48-106:
(i) In the event of a company action level event with respect to a domestic insurer, the commissioner shall take no regulatory action under this chapter;
(ii) In the event of a regulatory action level event under W.S. 26-48-104(a)(i) through (iii) the commissioner shall take the actions required under W.S. 26-48-103;
(iii) In the event of a regulatory action level event under W.S. 26-48-104(a)(iv) through (ix) or an authorized control level event, the commissioner shall take the actions required under W.S. 26-48-104 with respect to the insurer;
(iv) In the event of a mandatory control level event, the commissioner shall take the actions required under W.S. 26-48-105 with respect to the insurer.
(b) For RBC reports required to be filed by property and casualty insurers with respect to 1995, the following requirements shall apply in lieu of the provisions of W.S. 26-48-103 through 26-48-106:
(i) In the event of a company action level event with respect to a domestic insurer, the commissioner shall take no regulatory action under this chapter;
(ii) In the event of a regulatory action level event under W.S. 26-48-104(a)(i) through (iii) the commissioner shall take the actions required under W.S. 26-48-103;
(iii) In the event of a regulatory action level event under W.S. 26-48-104(a)(iv) through (ix) or an authorized control level event, the commissioner shall take the actions required under W.S. 26-48-104 with respect to the insurer;
(iv) In the event of a mandatory control level event with respect to an insurer, the commissioner shall take the actions required under W.S. 26-48-105 with respect to the insurer.
(c) W.S. 26-48-110(a) shall not be effective for any foreign insurer until July 1, 1996, unless the commissioner requests in writing that the foreign insurer submit an RBC report.
(a) As used in this article:
(i) "Adjusted RBC report" means an RBC report which has been adjusted by the commissioner in accordance with W.S. 26-48-202(c);
(ii) "Corrective order" means an order issued by the commissioner specifying corrective actions which the commissioner has determined are required;
(iii) "Domestic health organization" means a health organization domiciled in this state;
(iv) "Foreign health organization" means a health organization that is licensed to do business in this state but is not domiciled in this state;
(v) "Health organization" means a health maintenance organization, limited health service organization, dental or vision plan, hospital, medical and dental indemnity or service corporation or other managed care organization licensed under chapter 3 or chapter 34 of this title. This definition does not include an organization that is licensed as either a life and health insurer or a property and casualty insurer as defined in W.S. 26-48-101(a)(xiii) and (xiv) and that is otherwise subject to either the life or property and casualty risk based capital requirements of W.S. 26-48-101 through 26-48-112;
(vi) "NAIC" means the National Association of Insurance Commissioners;
(vii) "RBC" means risk-based capital;
(viii) "RBC instructions" means the RBC report including risk-based capital instructions adopted by the commissioner, and as may be amended by the commissioner;
(ix) "RBC level" means a health organization's company action level RBC, regulatory action level RBC, authorized control level RBC or mandatory control level RBC where:
(A) "Company action level RBC" means, with respect to any health organization, the product of two (2) and its authorized control level RBC;
(B) "Regulatory action level RBC" means the product of one and one-half (1.5) and its authorized control level RBC;
(C) "Authorized control level RBC" means the number determined under the risk-based capital formula in accordance with the RBC instructions;
(D) "Mandatory control level RBC" means the product of seven-tenths (.7) and the authorized control level RBC.
(x) "RBC plan" means a comprehensive financial plan containing the elements specified in W.S. 26-48-203(b). If the commissioner rejects the RBC plan, and it is revised by the health organization, with or without the commissioner's recommendation, the plan shall be called the "revised RBC plan";
(xi) "RBC report" means the report required in W.S. 26-48-202;
(xii) "Total adjusted capital" means the sum of:
(A) A health organization's statutory capital and surplus as determined in accordance with the statutory accounting applicable to the annual financial statements required to be filed under W.S. 26-3-123 or 26-34-110; and
(B) Such other items, if any, as the RBC instructions may provide.
(a) A domestic health organization shall, annually on or prior to March 1, prepare and submit to the commissioner a report of its RBC levels as of the end of the calendar year just ended, in a form and containing information as required by the RBC instructions. In addition, every domestic health organization shall file its RBC report:
(i) With the NAIC in accordance with the RBC instructions; and
(ii) With the insurance commissioner in any state in which the health organization is authorized to do business, if the insurance commissioner has notified the health organization of its request in writing, in which case the health organization shall file its RBC report not later than the later of:
(A) Fifteen (15) days from the receipt of notice to file its RBC report with that state; or
(B) March 1.
(b) A health organization's RBC shall be determined in accordance with the formula set forth in the RBC instructions and this article. The formula shall take the following into account, and may adjust for the covariance between the following which are determined in each case by applying the factors in the manner set forth in the RBC instructions:
(i) Asset risk;
(ii) Credit risk;
(iii) Underwriting risk; and
(iv) All other business risks and other relevant risks as are set forth in the RBC instructions.
(c) If a domestic health organization files an RBC report which in the judgment of the commissioner is inaccurate, the commissioner shall adjust the RBC report to correct the inaccuracy and shall notify the health organization of the adjustment. The notice shall contain a statement of the reasons for the adjustment. An RBC report as so adjusted is referred to as an "adjusted RBC report".
(d) An excess of capital over the amount produced by the risk-based capital requirements contained in this article and the formulas, schedules and instructions referenced in this article is desirable in the business of health insurance. Accordingly, health organizations should seek to maintain capital above the RBC levels required by this article. Additional capital is used and useful in the insurance business and helps to secure a health organization against various risks inherent in, or affecting, the business of insurance and not accounted for or only partially measured by the risk-based capital requirements contained in this article.
(a) "Company action level event" means any of the following events:
(i) The filing of an RBC report by a health organization that indicates that the health organization's total adjusted capital is greater than or equal to its regulatory action level RBC but less than its company action level RBC;
(ii) If a health organization has total adjusted capital which is greater than or equal to its company action level RBC but less than the product of its authorized control level RBC and three (3) and triggers the trend test determined in accordance with the trend test calculation included in the health RBC instructions;
(iii) Notification by the commissioner to the health organization of an adjusted RBC report that indicates an event in paragraph (i) or (ii) of this subsection, provided the health organization does not challenge the adjusted RBC report under W.S. 26-48-207; or
(iv) If a health organization challenges an adjusted RBC report that indicates the event in paragraph (i) or (ii) of this subsection under W.S. 26-48-207, the notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.
(b) In the event of a company action level event, the health organization shall prepare and submit to the commissioner an RBC plan which shall:
(i) Identify the conditions that contribute to the company action level event;
(ii) Contain proposals of corrective actions that the health organization intends to take and that would be expected to result in the elimination of the company action level event;
(iii) Provide projections of the health organization's financial results in the current year and at least the two (2) succeeding years, both in the absence of proposed corrective actions and giving effect to the proposed corrective actions, including projections of statutory balance sheets, operating income, net income, capital and surplus and RBC levels. The projections for both new and renewal business may include separate projections for each major line of business and separately identify each significant income, expense and benefit component;
(iv) Identify the key assumptions impacting the health organization's projections and the sensitivity of the projections to the assumptions; and
(v) Identify the quality of, and problems associated with, the health organization's business, including but not limited to its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business and use of reinsurance, if any, in each case.
(c) The RBC plan shall be submitted:
(i) Within forty-five (45) days of the company action level event; or
(ii) If the health organization challenges an adjusted RBC report under W.S. 26-48-207, within forty-five (45) days after notification to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.
(d) Within sixty (60) days after the submission by a health organization of an RBC plan to the commissioner, the commissioner shall notify the health organization whether the RBC plan shall be implemented or is, in the judgment of the commissioner, unsatisfactory. If the commissioner determines the RBC plan is unsatisfactory, the notification to the health organization shall set forth the reasons for the determination, and may set forth proposed revisions which will render the RBC plan satisfactory, in the judgment of the commissioner. Upon notification from the commissioner, the health organization shall prepare a revised RBC plan, which may incorporate by reference any revisions proposed by the commissioner, and shall submit the revised RBC plan to the commissioner:
(i) Within forty-five (45) days after the notification from the commissioner; or
(ii) If the health organization challenges the notification from the commissioner under W.S. 26-48-207, within forty-five (45) days after a notification to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.
(e) In the event of a notification by the commissioner to a health organization that the health organization's RBC plan or revised RBC plan is unsatisfactory, the commissioner may, subject to the health organization's right to a hearing under W.S. 26-48-207, specify in the notification that the notification constitutes a regulatory action level event.
(f) Every domestic health organization that files an RBC plan or revised RBC plan with the commissioner shall file a copy of the RBC plan or revised RBC plan with the insurance commissioner in any state in which the health organization is authorized to do business if:
(i) The state has an RBC provision substantially similar to W.S. 26-48-208(a); and
(ii) The insurance commissioner of that state has notified the health organization of its request for the filing in writing, in which case the health organization shall file a copy of the RBC plan or revised RBC plan in that state no later than the later of:
(A) Fifteen (15) days after the receipt of notice to file a copy of its RBC plan or revised RBC plan with the state; or
(B) The date on which the RBC plan or revised RBC plan is filed under subsections (c) and (d) of this section.
(a) "Regulatory action level event" means, with respect to a health organization, any of the following events:
(i) The filing of an RBC report by the health organization that indicates that the health organization's total adjusted capital is greater than or equal to its authorized control level RBC but less than its regulatory action level RBC;
(ii) Notification by the commissioner to a health organization of an adjusted RBC report that indicates the event in paragraph (i) of this subsection, provided the health organization does not challenge the adjusted RBC report under W.S. 26-48-207;
(iii) If the health organization challenges an adjusted RBC report that indicates the event in paragraph (i) of this subsection under W.S. 26-48-207, the notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge;
(iv) The failure of the health organization to file an RBC report annually by March 1, unless the health organization has provided an explanation for the failure that is satisfactory to the commissioner and has cured the failure within ten (10) days after the filing date;
(v) The failure of the health organization to submit an RBC plan to the commissioner within the time period set forth in W.S. 26-48-203(c);
(vi) Notification by the commissioner to the health organization that:
(A) The RBC plan or revised RBC plan submitted by the health organization is, in the judgment of the commissioner, unsatisfactory; and
(B) Such notification constitutes a regulatory action level event with respect to the health organization, provided the health organization has not challenged the determination under W.S. 26-48-207.
(vii) If the health organization challenges a determination by the commissioner under paragraph (vi) of this subsection under W.S. 26-48-207, the notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the challenge;
(viii) Notification by the commissioner to the health organization that the health organization has failed to adhere to its RBC plan or revised RBC plan, but only if the failure has a substantial adverse effect on the ability of the health organization to eliminate the company action level event in accordance with its RBC plan or revised RBC plan and the commissioner has so stated in the notification, provided the health organization has not challenged the determination under W.S. 26-48-207; or
(ix) If the health organization challenges a determination by the commissioner under paragraph (viii) of this subsection under W.S. 26-48-207, the notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the challenge.
(b) In the event of a regulatory action level event the commissioner shall:
(i) Require the health organization to prepare and submit an RBC plan or, if applicable, a revised RBC plan;
(ii) Perform an examination or analysis as he deems necessary of the assets, liabilities and operations of the health organization including a review of its RBC plan or revised RBC plan; and
(iii) Subsequent to the examination or analysis, issue an order specifying such corrective actions as he shall determine are required.
(c) In determining corrective actions, the commissioner may take into account factors he deems relevant with respect to the health organization based upon his examination or analysis of the assets, liabilities and operations of the health organization, including, but not limited to, the results of any sensitivity tests undertaken pursuant to the RBC instructions. The RBC plan or revised RBC plan shall be submitted:
(i) Within forty-five (45) days after the occurrence of the regulatory action level event;
(ii) If the health organization challenges an adjusted RBC report under W.S. 26-48-207 and the challenge is not frivolous in the judgment of the commissioner, within forty-five (45) days after the notification to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge; or
(iii) If the health organization challenges a revised RBC plan under W.S. 26-48-207 and the challenge is not frivolous in the judgment of the commissioner, within forty-five (45) days after the notification to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.
(d) The commissioner may retain actuaries and investment experts and other consultants necessary in the judgment of the commissioner to review the health organization's RBC plan or revised RBC plan, examine or analyze the assets, liabilities and operations of the health organization and formulate the corrective order with respect to the health organization. The fees, costs and expenses relating to consultants shall be borne by the affected health organization or other party as directed by the commissioner.
(a) "Authorized control level event" means any of the following events:
(i) The filing of an RBC report by the health organization that indicates that the health organization's total adjusted capital is greater than or equal to its mandatory control level RBC but less than its authorized control level RBC;
(ii) The notification by the commissioner to the health organization of an adjusted RBC report that indicates the event in paragraph (i) of this subsection, provided the health organization does not challenge the adjusted RBC report under W.S. 26-48-207;
(iii) If the health organization challenges an adjusted RBC report that indicates the event in paragraph (i) of this subsection under W.S. 26-48-207, notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge;
(iv) The failure of the health organization to respond, in a manner satisfactory to the commissioner, to a corrective order, provided the health organization has not challenged the corrective order under W.S. 26-48-207; or
(v) If the health organization has challenged a corrective order under W.S. 26-48-207 and the commissioner has, after a hearing, rejected the challenge or modified the corrective order, the failure of the health organization to respond, in a manner satisfactory to the commissioner, to the corrective order subsequent to rejection or modification by the commissioner.
(b) In the event of an authorized control level event with respect to a health organization, the commissioner shall:
(i) Take such actions as are required under W.S. 26-48-204 regarding a health organization with respect to which a regulatory action level event has occurred; or
(ii) If the commissioner deems it to be in the best interests of the policyholders and creditors of the health organization and of the public, take any actions as are necessary to cause the health organization to be placed under regulatory control under chapter 28 of this code. In the event the commissioner takes such actions, the authorized control level event shall be deemed sufficient grounds for the commissioner to take action under chapter 28, and the commissioner shall have the rights, powers and duties with respect to the health organization as are set forth in chapter 28. In the event the commissioner takes actions under this paragraph pursuant to an adjusted RBC report, the health organization shall be entitled to such protections as are afforded to health organizations under the provisions of chapter 28 pertaining to summary proceedings.
(a) "Mandatory control level event" means any of the following events:
(i) The filing of an RBC report which indicates that the health organization's total adjusted capital is less than its mandatory control level RBC;
(ii) Notification by the commissioner to the health organization of an adjusted RBC report that indicates the event in paragraph (i) of this subsection, provided the health organization does not challenge the adjusted RBC report under W.S. 26-48-207; or
(iii) If the health organization challenges an adjusted RBC report that indicates the event in paragraph (i) of this subsection under W.S. 26-48-207, notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.
(b) In the event of a mandatory control level event, the commissioner shall take such actions as are necessary to place the health organization under regulatory control under chapter 28 of this code. In that event, the mandatory control level event shall be deemed sufficient grounds for the commissioner to take action under chapter 28, and the commissioner shall have the rights, powers and duties with respect to the health organization as are set forth in chapter 28. If the commissioner takes actions pursuant to an adjusted RBC report, the health organization shall be entitled to the protections of chapter 28 pertaining to summary proceedings. Notwithstanding any of the foregoing, the commissioner may forego action for up to ninety (90) days after the mandatory control level event if the commissioner finds there is a reasonable expectation that the mandatory control level event may be eliminated within the ninety (90) day period.
(a) A health organization shall have the right to an administrative hearing, on a record, at which the health organization may challenge any of the following determinations or actions by the commissioner:
(i) Notification to a health organization by the commissioner of an adjusted RBC report;
(ii) Notification to a health organization by the commissioner that:
(A) The health organization's RBC plan or revised RBC plan is unsatisfactory; and
(B) The notification constitutes a regulatory action level event with respect to the health organization.
(iii) Notification to any health organization by the commissioner that the health organization has failed to adhere to its RBC plan or revised RBC plan and that the failure has a substantial adverse effect on the ability of the health organization to eliminate the company action level event with respect to the health organization in accordance with its RBC plan or revised RBC plan; or
(iv) Notification to a health organization by the commissioner of a corrective order with respect to the health organization.
(b) A health organization seeking a hearing under this section shall notify the commissioner of its request for a hearing within five (5) days after the notification by the commissioner under subsection (a) of this section. Upon receipt of the health organization's request for a hearing, the commissioner shall set a date for the hearing, which shall be no less than ten (10) nor more than thirty (30) days after the date of receipt of the health organization's request.
26-48-208. Confidentiality; prohibition on announcements; prohibition on use in ratemaking.
(a) All RBC reports, to the extent the information is not required to be set forth in a publicly available annual statement schedule, and RBC plans, including the results or report of any examination or analysis of a health organization performed pursuant to this article and any corrective order issued by the commissioner pursuant to examination or analysis, with respect to a domestic health organization or foreign health organization that are in the possession or control of the department of insurance shall be confidential by law and privileged, shall not be subject to inspection under W.S. 16-4-201 through 16-4-205, shall not be subject to subpoena, and shall not be subject to discovery or admissible in evidence in any private civil action. However, the commissioner is authorized to use the documents, materials or other information in the furtherance of any regulatory or legal action brought as a part of the commissioner's official duties.
(b) Neither the commissioner nor any person who received documents, materials or other information while acting under the authority of the commissioner shall be permitted or required to testify in any private civil action concerning any confidential documents, materials or information subject to subsection (a) of this section.
(c) In order to assist in the performance of the commissioner's duties, the commissioner:
(i) May share documents, materials or other information, including the confidential and privileged documents, materials or information subject to subsection (a) of this section, with other state, federal and international regulatory agencies, with the NAIC and its affiliates and subsidiaries and with state, federal and international law enforcement authorities, provided that the recipient agrees to maintain the confidentiality and privileged status of the document, material or other information;
(ii) May receive documents, materials or information, including otherwise confidential and privileged documents, materials or information, from the NAIC and its affiliates and subsidiaries, and from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material or information; and
(iii) May enter into agreements governing sharing and use of information consistent with this subsection.
(d) No waiver of any applicable privilege or claim of confidentiality in the documents, materials or information shall occur as a result of disclosure to the commissioner under this section or as a result of sharing as authorized in paragraph (c)(iii) of this section.
(e) The comparison of a health organization's total adjusted capital to any of its RBC levels is a regulatory tool which may indicate the need for corrective action with respect to the health organization and is not intended as a means to rank health organizations generally. Therefore, except as otherwise required under the provisions of this article, the making, publishing, disseminating, circulating or placing before the public, or causing, directly or indirectly to be made, published, disseminated, circulated or placed before the public, in a newspaper, magazine or other publication, or in the form of a notice, circular, pamphlet, letter or poster, or over a radio or television station, or in any other way, an advertisement, announcement or statement containing an assertion, representation or statement with regard to the RBC levels of any health organization, or of any component derived in the calculation, by any health organization, agent, broker or other person engaged in any manner in the insurance business would be misleading and is therefore prohibited, provided, however, that if any materially false statement with respect to the comparison regarding a health organization's total adjusted capital to its RBC levels or an inappropriate comparison of any other amount to the health organizations' RBC levels is published in any written publication and the health organization is able to demonstrate to the commissioner with substantial proof the falsity of the statement, or the inappropriateness, as the case may be, then the health organization may publish an announcement in a written publication if the sole purpose of the announcement is to rebut the materially false statement.
(f) RBC instructions, RBC reports, adjusted RBC reports, RBC plans and revised RBC plans shall not be used by the commissioner for ratemaking nor considered or introduced as evidence in any rate proceeding nor used by the commissioner to calculate or derive any elements of an appropriate premium level or rate of return for any line of insurance that a health organization or any affiliate is authorized to write.
(a) The provisions of this article are supplemental to any other provisions of the laws of this state, and shall not preclude or limit any other powers or duties of the commissioner under such laws, including, but not limited to, W.S. 26-3-115, 26-3-116, 26-28-101 through 26-28-131, 26-34-121 and 26-34-123.
(b) The commissioner may adopt reasonable rules necessary for the implementation of this article.
(c) The commissioner may exempt from the application of this article a domestic health organization that:
(i) Writes direct business only in this state;
(ii) Assumes no reinsurance in excess of five percent (5%) of direct premium written, and:
(A) Writes direct annual premiums for comprehensive medical business of two million dollars ($2,000,000.00) or less; or
(B) Is a limited health service organization that covers less than two thousand (2,000) lives.
(a) A foreign health organization shall, upon the written request of the commissioner, submit to the commissioner an RBC report as of the end of the calendar year just ended by the later of:
(i) The date an RBC report would be required to be filed by a domestic health organization under this article; or
(ii) Fifteen (15) days after the request is received by the foreign health organization.
(b) A foreign health organization shall, at the written request of the commissioner, promptly submit to the commissioner a copy of any RBC plan that is filed with the insurance commissioner of any other state.
(c) In the event of a company action level event, regulatory action level event or authorized control level event with respect to a foreign health organization as determined under the RBC statute applicable in the state of domicile of the health organization, or, if no RBC statute is in force in that state, under the provisions of this article, if the insurance commissioner of the state of domicile of the foreign health organization fails to require the foreign health organization to file an RBC plan in the manner specified under that state's RBC statute, or, if no RBC statute is in force in that state, under W.S. 26-48-203, the commissioner may require the foreign health organization to file an RBC plan with the commissioner. In such event, the failure of the foreign health organization to file an RBC plan with the commissioner shall be grounds to order the health organization to cease and desist from writing new insurance business in this state.
(d) In the event of a mandatory control level event with respect to a foreign health organization, if no domiciliary receiver has been appointed with respect to the foreign health organization under the rehabilitation and liquidation statute applicable in the state of domicile of the foreign health organization, the commissioner may make application to the district court of Laramie county as permitted under chapter 28 of this code. The occurrence of the mandatory control level event shall be considered adequate grounds for the application.
There shall be no liability on the part of, and no cause of action shall arise against, the commissioner or the insurance department or its employees or agents for any action taken by them in the performance of their powers and duties under this article.
All notices by the commissioner to a health organization that may result in regulatory action under this article shall be effective upon dispatch if transmitted by registered or certified mail, or in the case of any other transmission shall be effective upon the health organization's receipt of notice.
(a) The purpose of this article is to create a legal framework within which service contracts may be sold in this state.
(b) The following are exempt from W.S. 26-49-103 through 26-49-111:
(i) Warranties;
(ii) Maintenance agreements;
(iii) Warranties, service contracts and maintenance agreements offered by public utilities on their transmission devices to the extent they are regulated by public service commission; and
(iv) Service contracts sold or offered for sale to persons other than consumers.
(c) The types of agreements referred to in subsection (b) of this section do not have to comply with any provision of the insurance law of this state.
(d) This article does not apply to:
(i) Mechanical breakdown insurers licensed pursuant to chapter 37 of this code;
(ii) To mechanical breakdown insurance organizations who maintain a license pursuant to W.S. 26-37-106;
(iii) To motor club services regulated pursuant to the Motor Club Services Act;
(iv) Theft protection programs or their accompanying warranties except that theft protection programs and their accompanying warranties shall be subject to the enforcement provisions of W.S. 26-49-110.
(a) As used in this article:
(i) "Administrator" means the person who is responsible for the administration of the service contracts or the service contracts plans or who is responsible for any filings required by this article;
(ii) "Consumer" means a natural person who buys other than for purposes of resale any tangible personal property that is distributed in commerce and that is normally used for personal, family or household purposes and not for business or research purposes;
(iii) "Maintenance agreement" means a contract of limited duration that provides for scheduled maintenance only;
(iv) "Nonoriginal manufacturer’s parts" means replacement parts not made for or by the original manufacturer of the property, commonly referred to as "after market parts";
(v) "Premium" means the consideration paid to an insurer for a reimbursement insurance policy;
(vi) "Provider" means a person who is contractually obligated to the service contract holder under the terms of the service contract;
(vii) "Provider fee" means the consideration paid for a service contract;
(viii) "Reimbursement insurance policy" means a policy of insurance that is issued to a provider to provide reimbursement to the provider or to pay on behalf of the provider all covered contractual obligations incurred by the provider under the terms of the insured service contracts issued or sold by the provider;
(ix) "Service contract" means a contract or agreement for a separately stated consideration for a specific duration to perform the repair, replacement or maintenance of property or indemnification for repair, replacement or maintenance, for the operational or structural failure due to a defect in materials or workmanship or normal wear and tear, with or without additional provision for incidental payment or indemnity under limited circumstances, including, but not limited to, towing, rental and emergency road service. Service contracts may provide for the repair, replacement or maintenance of property for damage resulting from power surges and accidental damage from handling. "Service contract" also includes a contract or agreement for one (1) or more of the following:
(A) The removal of dents, dings or creases that can be repaired using the process of paintless dent removal without affecting the existing paint finish and without replacing vehicle body panels or sanding, bonding or painting;
(B) The repair or replacement of tires or wheels damaged as a result of coming into contact with ordinary road hazards. A contract or agreement meeting the definition set forth in this subparagraph in which the party obligated to perform is either a tire or wheel manufacturer or a motor vehicle manufacturer is exempt from the requirements of this chapter;
(C) The repair of small windshield chips or cracks in or the replacement of the entire windshield as a result of damage caused by road hazards;
(D) The repair of damage to the interior components of a motor vehicle caused by wear and tear but which expressly excludes the replacement of any part or component of a motor vehicle's interior;
(E) The replacement of a motor vehicle key or key fob in the event that the key or key fob becomes inoperable, lost or stolen;
(F) In conjunction with a motor vehicle leased for use, the repair, replacement or maintenance of property or indemnification for repair, replacement or maintenance due to excess wear and use, damage to items such as tires, paint cracks or chips, interior stains, rips or scratches, exterior dents or scratches, windshield cracks or chips, missing interior or exterior parts or excess mileage that result in a lease-end charge, or any other charge for damage that is deemed as excess wear and use by a lessor under a motor vehicle lease, provided that any repair, replacement, maintenance or indemnification shall not exceed the purchase price of the vehicle.
(x) "Service contract holder" or "contract holder" means a person who is the purchaser or holder of a service contract;
(xi) "Warranty" means a warranty made solely by the manufacturer, importer or seller of property or services without consideration, that is not negotiated or separated from the sale of the product and is incidental to the sale of the product, that guarantees indemnity for defective parts, mechanical or electrical breakdown, labor or other remedial measures, such as repair or replacement of the property or repetition of services;
(xii) "Incidental theft protection program payment" means expenses specified in a theft protection program warranty that are incurred by the warranty holder due to the failure of the warranty holder's theft protection program to perform as provided in the theft protection program warranty. Incidental theft protection program payments may include insurance policy deductibles, rental vehicle charges, the difference between the actual value of the stolen vehicle at the time of theft and the cost of a replacement vehicle, sales taxes, registration fees, transaction fees and mechanical inspection fees. Incidental theft protection program payments may be reimbursements in either a fixed amount specified in the theft protection program warranty or by use of a formula itemizing specific incidental theft protection program payments that may be due to the warranty holder;
(xiii) "Road hazard" means a hazard that is encountered while driving a motor vehicle and that may include, but is not limited to, potholes, rocks, wood debris, metal parts, glass, plastic, curbs or composite scraps;
(xiv) "Theft protection program" means a device or system that:
(A) Is installed on or applied to a motor vehicle and designed to prevent the theft of the vehicle or, if the vehicle is stolen, aid in the recovery of the vehicle;
(B) Includes a theft protection program warranty;
(C) May include but is not limited to:
(I) An alarm system;
(II) A body part marking product;
(III) A steering lock;
(IV) A window etch product;
(V) A pedal or ignition lock;
(VI) A fuel or ignition kill switch;
(VII) An electronic, radio or satellite tracking device.
(xv) "Theft protection program warranty" means a written agreement by a warrantor that provides if the theft protection program fails to prevent loss or damage to a motor vehicle from theft, the warrantor will pay to or on behalf of the warranty holder specified incidental theft protection program payments as a result of the failure of the theft protection program to perform pursuant to the terms of the theft protection program warranty.
(a) A provider may, but is not required to, appoint an administrator or other designee to be responsible for any or all of the administration of service contracts and compliance with this article.
(b) Service contracts shall not be issued, sold or offered for sale in this state unless the provider has:
(i) Provided a receipt for, or other written evidence of, the purchase of the service contract to the contract holder; and
(ii) Provided a copy of the service contract to the service contract holder within a reasonable period of time from the date of purchase.
(c) Each provider of service contracts sold in this state shall file a registration with the commissioner on a form prescribed by the commissioner. Each provider shall:
(i) Pay to the commissioner a fee in the amount of two hundred dollars ($200.00) annually;
(ii) Verify compliance annually with the faithful performance requirements specified in subsection (d) of this section on a form prescribed by the commissioner.
(d) In order to assure the faithful performance of a provider’s obligations to its service contract holders, each provider shall be responsible for complying with the requirements of any one (1) of the following paragraphs:
(i) Insure all service contracts under a reimbursement insurance policy issued by an insurer authorized to transact insurance in this state or issued pursuant to chapter 11 of this code;
(ii) Maintain a funded reserve account for its obligations under its service contracts issued and outstanding in this state. The reserves shall not be less than forty percent (40%) of the gross consideration received, less claims paid, on the sale of the service contract for all in force contracts. The reserve account shall be subject to examination and review by the commissioner. The provider shall also place in trust with the commissioner a financial security deposit, having a value of not less than five percent (5%) of the gross consideration received, less claims paid, on the sale of the service contract for all service contracts issued and in force, but not less than twenty-five thousand dollars ($25,000.00), consisting of one (1) of the following:
(A) A surety bond issued by an authorized surety;
(B) Securities of the type eligible for deposit by authorized insurers in this state;
(C) Cash;
(D) A letter of credit issued by a qualified financial institution; or
(E) Another form of security prescribed by regulations issued by the commissioner.
(iii) Maintain, or its parent company maintain, a net worth or stockholders’ equity of at least one hundred million dollars ($100,000,000.00). The provider shall also upon request, provide the commissioner with a copy of provider’s or the provider’s parent company’s most recent Form 10-K or Form 20-F filed with the securities and exchange commission within the last calendar year, or if the company does not file with the securities and exchange commission, a copy of the provider’s or the provider’s parent company’s financial statements, which show a net worth of the provider or its parent company of at least one hundred million dollars ($100,000,000.00). If the provider’s parent company’s Form 10-K, Form 20-F or financial statements are filed to meet the provider’s financial stability requirement, then the parent company shall agree to guarantee the obligations of the provider relating to service contracts sold by the provider in this state.
(e) Service contracts shall require the provider to permit the original service contract holder to return the service contract within twenty (20) days of the date the service contract was mailed to the service contract holder or within ten (10) days of delivery if the service contract is delivered to the service contract holder at the time of sale or within a longer time period permitted under the service contract. Upon return of the service contract to the provider within the applicable time period, if no claim has been made under the service contract prior to its return to the provider, the service contract is void and the provider shall refund to the service contract holder, or credit the account of the service contract holder, with the full purchase price of the service contract. The right to void the service contract provided in this subsection is not transferable and shall apply only to the original service contract purchaser, and only if no claim has been made prior to its return to the provider. A ten percent (10%) penalty per month shall be added to a refund that is not paid or credited within forty-five (45) days after return of the service contract to the provider.
(f) Provider fees collected on service contracts shall not be subject to premium taxes. Premiums for reimbursement insurance policies shall be subject to applicable taxes.
(g) Except for the registration requirement in subsection
(c) of this section, providers and related service contract sellers, administrators and other persons marketing, selling or offering to sell service contracts are exempt from any licensing requirements of this state.
(h) The marketing, sale, offering for sale, issuance, making, proposing to make and administration of service contracts by providers and related service contract sellers, administrators and other persons shall be exempt from all other provisions of this state’s insurance law.
(a) Reimbursement insurance policies insuring service contracts issued, sold or offered for sale in this state shall state that the insurer that issued the reimbursement insurance policy shall reimburse or pay on behalf of the provider any covered sums the provider is legally obligated to pay or shall provide the service which the provider is legally obligated to perform according to the provider’s contractual obligations under the insured service contracts issued or sold by the provider.
(b) In the event covered service is not provided by the service contract provider within sixty (60) days of proof of loss by the service contract holder, the contract holder is entitled to apply directly to the reimbursement insurance company.
26-49-105. Required disclosures; service contracts.
(a) Service contracts marketed, sold, offered for sale, issued, made, proposed to be made, or administered in this state shall be written, printed or typed in clear, understandable language that is easy to read and shall disclose the requirements set forth in this section, as applicable.
(b) Service contracts insured under a reimbursement insurance policy pursuant to W.S. 26-49-103(d)(i) shall contain a statement in substantially the following form: "Obligations of the provider under this service contract are insured under a service contract reimbursement insurance policy." The service contract shall state the name and address of the insurer.
(c) Service contracts not insured under a reimbursement insurance policy pursuant to W.S. 26-49-103(d)(i) shall contain a statement in substantially the following form: "Obligations of the provider under this service contract are backed by the full faith and credit of the provider."
(d) Service contracts shall state the name and address of the provider and shall identify any administrator if different from the provider, the service contract seller, and the service contract holder to the extent that the name of the service contract holder has been furnished by the service contract holder. The identities of such parties are not required to be preprinted on the service contract and may be added to the service contract at the time of sale.
(e) Service contracts shall state the purchase price of the service contract and the terms under which the service contract is sold. The purchase price is not required to be preprinted on the service contract and may be negotiated at the time of sale with the service contract holder.
(f) Service contracts shall state the existence of any deductible amount, if applicable.
(g) Service contracts shall specify the merchandise and services to be provided and any limitations, exceptions or exclusions.
(h) Service contracts covering automobiles shall state whether the use of nonoriginal manufacturer’s parts is allowed.
(j) Service contracts shall state any restrictions governing the transferability of the service contract, if applicable.
(k) Service contracts shall state the terms, restrictions or conditions governing cancellation of the service contract prior to the termination or expiration date of the service contract by either the provider or by the service contract holder. The provider of the service contract shall mail a written notice to the service contract holder at the last known address of the service contract holder contained in the records of the provider at least ten (10) days prior to cancellation by the provider. Prior notice is not required if the reason for cancellation is nonpayment of the provider fee, a material misrepresentation by the service contract holder to the provider or a substantial breach of duties by the service contract holder relating to the covered product or its use. The notice shall state the effective date of the cancellation and the reason for the cancellation.
(m) Service contracts shall set forth the obligations and duties of the service contract holder, such as the duty to protect against any further damage and any requirement to follow owner’s manual instructions.
(n) Service contracts shall state whether or not the service contract provides for or excludes consequential damages or preexisting conditions, if applicable.
(a) A provider shall not use in its name the words insurance, casualty, surety, mutual or any other words descriptive of the insurance, casualty or surety business; or a name deceptively similar to the name or description of any insurance or surety corporation, or to the name of any other provider. The word "guaranty" or similar word may be used by a provider. This section shall not apply to a company that was using any of the prohibited language in its name prior to April 1, 1999. However, a company using the prohibited language in its name shall include in its service contracts a statement in substantially the following form: "This agreement is not an insurance contract."
(b) A provider or its representative shall not in its service contracts or literature make, permit or cause to be made any false or misleading statement, or deliberately omit any material statement that would be considered misleading if omitted.
(c) A person, such as a bank, savings and loan association, lending institution, manufacturer or seller of any product, shall not require the purchase of a service contract as a condition of a loan or a condition for the sale of any property.
(a) The provider shall keep accurate accounts, books, and records concerning transactions regulated under this article. The provider’s accounts, books and records shall include the following:
(i) Copies of each type of service contract sold;
(ii) The name and address of each service contract holder, to the extent that the name and address have been furnished by the service contract holder;
(iii) A list of the locations where service contracts are marketed, sold or offered for sale;
(iv) Written claims files, which shall contain at least the dates and description of claims related to the service contracts.
(b) Except as provided in subsection (d) of this section, the provider shall retain all records required to be maintained by this section for at least one (1) year after the specified period of coverage has expired.
(c) The records required under this article may be, but are not required to be, maintained on a computer disk or other record keeping technology. If the records are maintained in other than hard copy, the records shall be capable of duplication to legible hard copy at the request of the commissioner.
(d) A provider discontinuing business in this state shall maintain its records until it furnishes the commissioner satisfactory proof that it has discharged all obligations to service contract holders in this state.
26-49-108. Cancellation of reimbursement insurance policy.
As applicable, an insurer that issued a reimbursement insurance policy shall not terminate the policy until a notice of termination in accordance with chapter 35 of this code, has been mailed or delivered to the commissioner. The termination of a reimbursement insurance policy shall not reduce the issuer’s responsibility for service contracts issued by providers prior to the date of the termination.
26-49-109. Obligations of reimbursement insurance policy insurers.
(a) Providers are considered to be the agent of the insurer which issued the reimbursement insurance policy for purposes of obligating the insurer to service contract holders in accordance with the service contract and this article. In cases where a provider is acting as an administrator and enlists other providers, the provider acting as the administrator shall notify the insurer of the existence and identities of the other providers.
(b) This article shall not prevent or limit the right of an insurer which issued a reimbursement insurance policy to seek indemnification or subrogation against a provider if the issuer pays or is obligated to pay the service contract holder sums that the provider was obligated to pay pursuant to the provisions of the service contract.
(a) The commissioner may conduct examinations of providers, administrators, insurers or other persons to enforce this article and protect service contract holders in this state. Upon request of the commissioner, the provider shall make all accounts, books and records concerning service contracts sold by the provider available to the commissioner which are necessary to enable the commissioner to reasonably determine compliance or noncompliance with this article.
(b) The commissioner may take action which is necessary or appropriate to enforce the provisions of this article and the commissioner’s regulations and orders, and to protect service contract holders in this state.
(c) If a provider has violated this article or the commissioner’s regulations or orders, the commissioner may issue an order directed to that provider to cease and desist from committing violations of this article or the commissioner’s regulations or orders; may issue an order prohibiting that provider from selling or offering for sale service contracts in violation of this article; or may issue an order imposing a civil penalty on that provider; or any combination of the foregoing, as applicable. A person aggrieved by an order issued under this section may request a hearing before the commissioner pursuant to W.S. 26-2-125.
(d) The commissioner may bring an action in any court of competent jurisdiction, for an injunction or other appropriate relief to enjoin threatened or existing violations of this article or of the commissioner’s orders or regulations. An action filed under this section also may seek restitution on behalf of persons aggrieved by a violation of this article or orders or regulations of the commissioner.
(e) A person who is found to have violated this article or orders or regulation of the commissioner may be ordered to pay to the commissioner a civil penalty in an amount determined by the commissioner of not more than five hundred dollars ($500.00) per violation and no more than ten thousand dollars ($10,000.00) in the aggregate for all violations of a similar nature. For purposes of this section, violations shall be of a similar nature if the violation consists of the same or similar course of conduct, action or practice, irrespective of the number of times the act, conduct or practice which is determined to be a violation of this article occurred.
(a) As used in this chapter:
(i) "Insurance group" means those insurers and affiliates included within an insurance holding company system as defined in W.S. 26-44-101(a)(iv);
(ii) "Insurer" shall have the same meaning as set forth in W.S. 26-1-102(a)(xvi), except that it shall not include agencies, authorities or instrumentalities of the United States, its possessions and territories, the Commonwealth of Puerto Rico, the District of Columbia or a state or political subdivision of a state;
(iii) "Own risk and solvency assessment" or "ORSA" means a confidential internal assessment, appropriate to the nature, scale and complexity of an insurer or insurance group, conducted by that insurer or insurance group of the material and relevant risks associated with the insurer or insurance group's current business plan, and the sufficiency of capital resources to support those risks;
(iv) "ORSA guidance manual" means the current version of the Own Risk and Solvency Assessment Guidance Manual developed and adopted by the National Association of Insurance Commissioners (NAIC) and as amended from time to time. A change in the ORSA guidance manual shall be effective on January 1 following the calendar year in which the changes have been adopted by the NAIC;
(v) "ORSA summary report" means a confidential high-level summary of an insurer or insurance group's ORSA.
An insurer shall maintain a risk management framework to assist the insurer with identifying, assessing, monitoring, managing and reporting on its material and relevant risks. This requirement may be satisfied if the insurance group of which the insurer is a member maintains a risk management framework applicable to the operations of the insurer.
Subject to W.S. 26-51-106, an insurer, or the insurance group of which the insurer is a member, shall regularly conduct an ORSA consistent with a process comparable to the ORSA guidance manual. The ORSA shall be conducted no less than annually but also at any time when there are significant changes to the risk profile of the insurer or the insurance group of which the insurer is a member.
(a) Upon the commissioner's request, and no more than once each year, an insurer shall submit to the commissioner an ORSA summary report or any combination of reports that together contain the information described in the ORSA guidance manual, applicable to the insurer and the insurance group of which it is a member. Notwithstanding any request from the commissioner, if the insurer is a member of an insurance group, the insurer shall submit the report required by this subsection if the commissioner is the lead state commissioner of the insurance group as determined by the procedures within the financial analysis handbook adopted by the NAIC.
(b) The report shall include a signature of the insurer or insurance group's chief risk officer or other executive having responsibility for the oversight of the insurer's enterprise risk management process attesting to the best of his belief and knowledge that the insurer applies the enterprise risk management process described in the ORSA summary report and that a copy of the report has been provided to the insurer's board of directors or the appropriate committee thereof.
(c) An insurer may comply with subsection (a) of this section by providing the most recent and substantially similar report provided by the insurer or another member of an insurance group of which the insurer is a member to the commissioner of another state or to a supervisor or regulator of a foreign jurisdiction, if that report provides information that is comparable to the information described in the ORSA guidance manual. Any report in a language other than English shall be accompanied by a translation of that report into the English language.