Bill Text: IA SF2104 | 2013-2014 | 85th General Assembly | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: A bill for an act relating to the regulation of insurance company holding systems and providing assessments and penalties. (Formerly SSB 3090.) Effective 7-1-14.
Spectrum: Committee Bill
Status: (Passed) 2014-03-26 - Signed by Governor. S.J. 650. [SF2104 Detail]
Download: Iowa-2013-SF2104-Amended.html
Bill Title: A bill for an act relating to the regulation of insurance company holding systems and providing assessments and penalties. (Formerly SSB 3090.) Effective 7-1-14.
Spectrum: Committee Bill
Status: (Passed) 2014-03-26 - Signed by Governor. S.J. 650. [SF2104 Detail]
Download: Iowa-2013-SF2104-Amended.html
Senate
File
2104
-
Reprinted
SENATE
FILE
2104
BY
COMMITTEE
ON
COMMERCE
(SUCCESSOR
TO
SSB
3090)
(As
Amended
and
Passed
by
the
Senate
February
24,
2014
)
A
BILL
FOR
An
Act
relating
to
the
regulation
of
insurance
company
holding
1
systems
and
providing
assessments
and
penalties.
2
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
3
SF
2104
(3)
85
av/nh/jh
S.F.
2104
Section
1.
Section
521A.1,
subsection
3,
Code
2014,
is
1
amended
to
read
as
follows:
2
3.
“Control”
,
including
controlling,
controlled
by,
and
3
under
common
control
with,
shall
mean
the
possession,
direct
4
or
indirect,
of
the
power
to
direct
or
cause
the
direction
5
of
the
management
and
policies
of
a
person,
whether
through
6
the
ownership
of
voting
securities,
by
contract
other
than
7
a
commercial
contract
for
goods
or
nonmanagement
services,
8
or
otherwise,
unless
the
power
is
solely
the
result
of
an
9
official
position
with
or
a
corporate
office
held
by
the
10
person.
Control
shall
be
presumed
to
exist
if
any
person,
11
directly
or
indirectly,
owns,
controls,
holds
with
the
power
12
to
vote,
or
holds
proxies
representing,
ten
percent
or
more
of
13
the
voting
securities
of
any
other
person.
This
presumption
14
may
be
rebutted
by
a
showing
made
in
the
manner
provided
in
15
section
521A.3,
subsections
1
through
5,
inclusive,
or
section
16
521A.4,
subsection
11,
whichever
is
applicable,
that
control
17
does
not
exist
in
fact.
The
commissioner
may
determine,
after
18
furnishing
all
persons
in
interest
notice
and
opportunity
to
19
be
heard
and
making
specific
findings
of
fact
to
support
the
20
determination,
that
control
exists
in
fact,
notwithstanding
the
21
absence
of
a
presumption
to
that
effect.
22
Sec.
2.
Section
521A.1,
Code
2014,
is
amended
by
adding
the
23
following
new
subsections:
24
NEW
SUBSECTION
.
4A.
“Enterprise
risk”
means
any
activity,
25
circumstance,
event,
or
series
of
events
involving
one
or
more
26
affiliates
of
an
insurer
that,
if
not
remedied
promptly,
is
27
likely
to
have
a
material
adverse
effect
upon
the
financial
28
condition
or
liquidity
of
the
insurer
or
its
insurance
holding
29
company
system
as
a
whole,
including
but
not
limited
to
30
anything
that
would
cause
the
insurer’s
risk-based
capital
to
31
fall
into
a
company-action-level
event
as
set
forth
in
section
32
521E.3
for
insurers
or
section
521F.4
for
health
organizations,
33
or
would
cause
the
insurer
to
be
in
hazardous
financial
34
condition
pursuant
to
191
IAC
ch
110.
35
-1-
SF
2104
(3)
85
av/nh/jh
1/
17
S.F.
2104
NEW
SUBSECTION
.
9A.
“Supervisory
college”
means
a
temporary
1
or
permanent
forum
for
communication
and
cooperation
between
2
regulators
charged
with
supervision
of
an
insurer
or
its
3
affiliates.
4
Sec.
3.
Section
521A.3,
subsection
1,
paragraph
a,
Code
5
2014,
is
amended
to
read
as
follows:
6
a.
No
person
other
than
the
issuer
shall
make
a
tender
offer
7
for
or
a
request
or
invitation
for
tenders
of,
or
enter
into
8
any
agreement
to
exchange
securities
for,
seek
to
acquire,
or
9
acquire,
in
the
open
market
or
otherwise,
any
voting
security
10
of
a
domestic
insurer
if,
after
the
consummation
thereof,
11
such
person
would,
directly
or
indirectly,
or
by
conversion
12
or
by
exercise
of
any
right
to
acquire,
be
in
control
of
such
13
insurer,
and
no
person
shall
enter
into
an
agreement
to
merge
14
with
or
otherwise
to
acquire
control
of
a
domestic
insurer
15
unless,
at
the
time
any
such
offer,
request,
or
invitation
is
16
first
made
or
any
such
agreement
is
entered
into,
or
prior
to
17
the
acquisition
of
such
securities
if
no
offer
or
agreement
is
18
involved,
such
person
has
first
filed
with
the
commissioner
19
and
has
sent
to
such
insurer,
and
such
insurer
has
sent
to
its
20
shareholders,
a
statement
containing
the
information
required
21
by
this
section
and
such
offer,
request,
invitation,
agreement
22
or
acquisition
has
been
approved
by
the
commissioner
in
the
23
manner
hereinafter
prescribed.
24
Sec.
4.
Section
521A.3,
subsection
1,
Code
2014,
is
amended
25
by
adding
the
following
new
paragraph:
26
NEW
PARAGRAPH
.
0b.
For
purposes
of
this
section,
any
27
controlling
person
of
a
domestic
insurer
seeking
to
divest
its
28
controlling
interest
in
the
domestic
insurer,
in
any
manner,
29
shall
file
with
the
commissioner,
with
a
copy
to
the
insurer,
30
confidential
notice
of
its
proposed
divestiture
at
least
thirty
31
days
prior
to
the
cessation
of
control.
The
commissioner
32
shall
determine
those
instances
in
which
the
party
seeking
to
33
divest
or
to
acquire
a
controlling
interest
in
an
insurer,
34
shall
be
required
to
file
for
and
obtain
approval
of
the
35
-2-
SF
2104
(3)
85
av/nh/jh
2/
17
S.F.
2104
transaction.
The
information
shall
remain
confidential
until
1
the
conclusion
of
the
transaction
unless
the
commissioner,
in
2
the
commissioner’s
discretion,
determines
that
confidential
3
treatment
will
interfere
with
enforcement
of
this
section.
If
4
the
statement
referred
to
in
paragraph
“a”
is
otherwise
filed,
5
this
paragraph
“0b”
shall
not
apply.
6
Sec.
5.
Section
521A.3,
subsection
2,
paragraph
a,
7
unnumbered
paragraph
1,
Code
2014,
is
amended
to
read
as
8
follows:
9
The
statement
to
be
filed
with
the
commissioner
hereunder
10
shall
be
made
under
oath
or
affirmation
and
shall
contain
the
11
following
information
:
12
Sec.
6.
Section
521A.3,
subsection
2,
paragraph
a,
Code
13
2014,
is
amended
by
adding
the
following
new
subparagraphs:
14
NEW
SUBPARAGRAPH
.
(012)
An
agreement
by
the
person
required
15
to
file
the
statement
referred
to
in
subsection
1
that
the
16
person
will
provide
the
annual
report
specified
in
section
17
521A.4,
subsection
11A
for
so
long
as
control
exists.
18
NEW
SUBPARAGRAPH
.
(0012)
An
acknowledgment
by
the
person
19
required
to
file
the
statement
referred
to
in
subsection
1
20
that
the
person
and
all
subsidiaries
within
its
control
in
21
the
insurance
holding
company
system
will
provide
information
22
to
the
commissioner
upon
request
as
necessary
to
evaluate
23
enterprise
risk
to
the
insurer.
24
Sec.
7.
Section
521A.3,
subsection
4,
paragraph
a,
Code
25
2014,
is
amended
by
adding
the
following
new
subparagraph:
26
NEW
SUBPARAGRAPH
.
(6)
The
merger
or
other
acquisition
of
27
control
is
not
likely
to
be
hazardous
or
prejudicial
to
the
28
insurance-buying
public.
29
Sec.
8.
Section
521A.3,
subsection
4,
paragraph
b,
Code
30
2014,
is
amended
to
read
as
follows:
31
b.
The
public
hearing
referred
to
in
paragraph
“a”
shall
be
32
held
within
thirty
days
after
the
commissioner
has
determined
33
that
the
statement
required
by
subsection
1
is
filed
has
34
been
completed
and
contains
all
the
required
information
set
35
-3-
SF
2104
(3)
85
av/nh/jh
3/
17
S.F.
2104
forth
in
subsection
2
,
and
at
least
twenty
days’
notice
of
1
the
public
hearing
shall
be
given
by
the
commissioner
to
the
2
person
filing
the
statement
and
to
the
domestic
insurer
.
Not
3
less
than
seven
days’
notice
of
the
public
hearing
shall
be
4
given
by
the
person
filing
the
statement
to
the
insurer
and
to
5
such
other
persons
as
may
be
designated
by
the
commissioner.
6
The
commissioner
shall
make
a
determination
within
thirty
7
days
after
the
conclusion
of
the
hearing.
At
the
hearing,
8
the
person
filing
the
statement,
the
insurer,
any
person
to
9
whom
notice
of
hearing
was
sent,
and
any
other
person
whose
10
interests
may
be
affected
shall
have
the
right
to
present
11
evidence,
examine
and
cross-examine
witnesses,
and
offer
oral
12
and
written
arguments
and
in
connection
therewith
shall
be
13
entitled
to
conduct
discovery
proceedings
in
the
same
manner
as
14
is
presently
allowed
in
the
district
court
of
this
state.
All
15
discovery
proceedings
shall
be
concluded
not
later
than
three
16
days
prior
to
the
commencement
of
the
public
hearing.
17
Sec.
9.
Section
521A.3,
subsection
4,
Code
2014,
is
amended
18
by
adding
the
following
new
paragraph:
19
NEW
PARAGRAPH
.
0c.
If
the
proposed
merger
or
other
20
acquisition
of
control
will
require
the
approval
of
more
than
21
one
commissioner,
the
public
hearing
referred
to
in
paragraph
22
“a”
may
be
held
on
a
consolidated
basis
upon
request
of
the
23
person
filing
the
statement
referred
to
in
subsection
1.
24
Such
person
may
file
the
statement
referred
to
in
subsection
25
1
with
the
national
association
of
insurance
commissioners
26
within
five
days
of
making
the
request
for
a
public
hearing.
27
The
commissioner
may
opt
out
of
a
consolidated
hearing,
and
28
shall
provide
notice
to
the
applicant
of
the
opt-out
within
29
ten
days
of
the
receipt
of
the
statement
referred
to
in
30
subsection
1.
A
hearing
conducted
on
a
consolidated
basis
31
shall
be
public
and
shall
be
held
within
the
United
States
32
before
the
commissioners
of
the
states
in
which
the
insurers
33
are
domiciled.
Such
commissioners
shall
hear
and
receive
34
evidence.
The
commissioner
may
attend
such
hearing
in
person
35
-4-
SF
2104
(3)
85
av/nh/jh
4/
17
S.F.
2104
or
by
telecommunication.
1
Sec.
10.
Section
521A.4,
subsection
2,
Code
2014,
is
amended
2
by
adding
the
following
new
paragraphs:
3
NEW
PARAGRAPH
.
0e.
If
requested
by
the
commissioner,
the
4
insurer
shall
include
financial
statements
of
or
within
an
5
insurance
holding
company
system,
including
all
affiliates.
6
Financial
statements
may
include
but
are
not
limited
to
annual
7
audited
financial
statements
filed
with
the
United
States
8
securities
and
exchange
commission
pursuant
to
the
federal
9
Securities
Act
of
1933,
as
amended,
or
the
federal
Securities
10
Exchange
Act
of
1934,
as
amended.
An
insurer
required
to
file
11
financial
statements
pursuant
to
this
paragraph
may
satisfy
the
12
request
by
providing
the
commissioner
with
the
most
recently
13
filed
financial
statements
of
the
parent
corporation
that
have
14
been
filed
with
the
United
States
securities
and
exchange
15
commission.
16
NEW
PARAGRAPH
.
00e.
Statements
that
the
insurer’s
board
of
17
directors
oversees
corporate
governance
and
internal
controls
18
and
that
the
insurer’s
officers
or
senior
management
have
19
approved,
implemented,
and
continue
to
maintain
and
monitor
20
corporate
governance
and
internal
control
procedures.
21
NEW
PARAGRAPH
.
f.
Any
other
information
required
by
the
22
commissioner
by
rule
or
by
regulation.
23
Sec.
11.
Section
521A.4,
subsection
11,
Code
2014,
is
24
amended
to
read
as
follows:
25
11.
Disclaimer.
Any
person
may
file
with
the
commissioner
26
a
disclaimer
of
affiliation
with
any
authorized
insurer
or
such
27
a
disclaimer
may
be
filed
by
such
insurer
or
any
member
of
an
28
insurance
holding
company
system.
The
disclaimer
shall
fully
29
disclose
all
material
relationships
and
basis
for
affiliation
30
between
such
person
and
such
insurer
as
well
as
the
basis
for
31
disclaiming
such
affiliation.
After
a
disclaimer
has
been
32
filed,
the
insurer
shall
be
relieved
of
any
duty
to
register
or
33
report
under
this
section
which
may
arise
out
of
the
insurer’s
34
relationship
with
such
person
unless
and
until
the
commissioner
35
-5-
SF
2104
(3)
85
av/nh/jh
5/
17
S.F.
2104
disallows
such
a
disclaimer.
The
commissioner
shall
disallow
1
such
a
disclaimer
only
after
furnishing
all
parties
in
interest
2
with
notice
and
opportunity
to
be
heard
and
after
making
3
specific
findings
of
fact
to
support
such
disallowance.
A
4
disclaimer
of
affiliation
shall
be
deemed
to
have
been
granted
5
unless
the
commissioner,
within
thirty
days
following
receipt
6
of
a
complete
disclaimer,
notifies
the
filing
party
that
the
7
disclaimer
is
disallowed.
In
the
event
of
disallowance,
the
8
disclaiming
party
may
request
an
administrative
hearing,
which
9
shall
be
granted.
The
disclaiming
party
shall
be
relieved
of
10
its
duty
to
register
under
this
section
if
approval
of
the
11
disclaimer
has
been
granted
by
the
commissioner,
or
if
the
12
disclaimer
is
deemed
to
have
been
granted.
13
Sec.
12.
Section
521A.4,
Code
2014,
is
amended
by
adding
the
14
following
new
subsection:
15
NEW
SUBSECTION
.
11A.
Enterprise
risk
report.
The
ultimate
16
controlling
person
of
every
insurer
subject
to
registration
17
shall
also
file
an
annual
enterprise
risk
report.
The
report
18
shall,
to
the
best
of
the
ultimate
controlling
person’s
19
knowledge
and
belief,
identify
the
material
risks
within
the
20
insurance
holding
company
system
that
could
pose
enterprise
21
risk
to
the
insurer.
The
report
shall
be
filed
with
the
lead
22
state
commissioner
of
the
insurance
holding
company
system
as
23
determined
by
the
procedures
within
the
financial
analysis
24
handbook
adopted
by
the
national
association
of
insurance
25
commissioners.
26
Sec.
13.
Section
521A.4,
subsection
12,
Code
2014,
is
27
amended
to
read
as
follows:
28
12.
Violations.
The
failure
to
file
a
registration
29
statement
or
a
summary
of
the
registration
statement
or
an
30
enterprise
risk
report
required
by
this
section
within
the
time
31
specified
for
the
filing
is
a
violation
of
this
section
.
32
Sec.
14.
Section
521A.5,
subsection
1,
paragraph
a,
Code
33
2014,
is
amended
by
adding
the
following
new
subparagraph:
34
NEW
SUBPARAGRAPH
.
(02)
Agreements
for
cost-sharing
35
-6-
SF
2104
(3)
85
av/nh/jh
6/
17
S.F.
2104
services
and
management
shall
include
such
provisions
as
1
required
by
rule
issued
by
the
commissioner.
2
Sec.
15.
Section
521A.5,
subsection
1,
paragraph
b,
3
subparagraph
(5),
Code
2014,
is
amended
by
striking
the
4
subparagraph.
5
Sec.
16.
Section
521A.5,
subsection
1,
paragraph
c,
Code
6
2014,
is
amended
to
read
as
follows:
7
c.
A
domestic
insurer
and
a
person
in
its
holding
company
8
system
shall
not
enter
into
any
of
the
following
transactions,
9
unless
the
domestic
insurer
notifies
the
commissioner
in
10
writing
of
its
intention
to
enter
into
the
transaction
at
least
11
thirty
days
prior
to
entering
into
the
transaction
or
within
a
12
shorter
time
permitted
by
the
commissioner
and
the
commissioner
13
has
not
disapproved
of
the
transaction
within
the
time
period:
14
(1)
All
reinsurance
pooling
agreements.
15
(1)
(2)
All
reinsurance
agreements
or
modifications
to
such
16
agreements
in
which
the
reinsurance
premium
or
a
change
in
the
17
insurer’s
liabilities
,
or
the
projected
reinsurance
premium
18
or
a
change
in
the
insurer’s
liabilities
in
any
of
the
next
19
three
years,
equals
or
exceeds
five
percent
of
the
insurer’s
20
surplus
as
regards
policyholders,
as
of
the
next
preceding
21
December
31,
including
those
agreements
which
may
require
as
22
consideration
the
transfer
of
assets
from
an
insurer
to
a
23
nonaffiliate,
if
an
agreement
or
understanding
exists
between
24
the
insurer
and
nonaffiliate
that
any
portion
of
such
assets
25
will
be
transferred
to
one
or
more
affiliates
of
the
insurer.
26
(2)
(3)
All
management
agreements,
service
contracts,
tax
27
allocation
agreements,
guarantees,
and
all
other
cost-sharing
28
arrangements
involving
at
least
one-half
of
one
percent
of
the
29
insurer’s
surplus
as
of
the
next
preceding
December
31
.
A
30
guarantee
which
is
quantifiable
as
to
amount
is
not
subject
to
31
the
notice
requirements
of
this
paragraph
“c”
unless
it
exceeds
32
the
lesser
of
one-half
of
one
percent
of
the
insurer’s
admitted
33
assets
or
ten
percent
of
surplus
as
regards
policyholders
as
of
34
the
next
preceding
December
31.
Further,
all
guarantees
which
35
-7-
SF
2104
(3)
85
av/nh/jh
7/
17
S.F.
2104
are
not
quantifiable
as
to
amount
are
subject
to
the
notice
1
requirements
of
this
paragraph
“c”
.
2
(4)
Direct
or
indirect
acquisitions
or
investments
in
a
3
person
that
controls
the
insurer
or
in
an
affiliate
of
the
4
insurer
in
an
amount
which,
together
with
its
present
holdings
5
in
such
investments,
exceeds
two
and
one-half
percent
of
6
the
insurer’s
surplus
to
policyholders.
Direct
or
indirect
7
acquisitions
or
investments
in
subsidiaries
acquired
pursuant
8
to
section
521A.2
or
authorized
under
any
other
section
of
this
9
chapter,
or
in
nonsubsidiary
insurance
affiliates
that
are
10
subject
to
the
provisions
of
this
chapter,
are
exempt
from
this
11
subparagraph.
12
(3)
(5)
Any
material
transactions
specified
by
rule
which
13
the
commissioner
determines
may
adversely
affect
the
interests
14
of
the
domestic
insurer’s
policyholders.
15
Sec.
17.
Section
521A.5,
Code
2014,
is
amended
by
adding
the
16
following
new
subsection:
17
NEW
SUBSECTION
.
4.
Management
of
domestic
insurers
subject
18
to
registration.
19
a.
Notwithstanding
the
control
of
a
domestic
insurer
by
any
20
person,
the
officers
and
directors
of
the
insurer
shall
not
21
thereby
be
relieved
of
any
obligation
or
liability
to
which
22
they
would
otherwise
be
subject
by
law,
and
the
insurer
shall
23
be
managed
so
as
to
assure
its
separate
operating
identity
24
consistent
with
this
chapter.
25
b.
Nothing
in
this
section
shall
preclude
a
domestic
insurer
26
from
having
or
sharing
a
common
management,
or
cooperative
or
27
joint
use
of
personnel,
property,
or
services
with
one
or
more
28
other
persons
under
arrangements
meeting
the
standards
of
this
29
section.
30
c.
Not
less
than
one-third
of
the
directors
of
a
domestic
31
insurer,
and
not
less
than
one-third
of
the
members
of
each
32
committee
of
the
board
of
directors
of
any
domestic
insurer,
33
shall
be
persons
who
are
not
officers
or
employees
of
the
34
insurer
or
of
any
entity
controlling,
controlled
by,
or
under
35
-8-
SF
2104
(3)
85
av/nh/jh
8/
17
S.F.
2104
common
control
with
the
insurer
and
who
are
not
beneficial
1
owners
of
a
controlling
interest
in
the
voting
stock
of
the
2
insurer
or
entity.
At
least
one
such
person
must
be
included
3
in
any
quorum
for
the
transaction
of
business
at
any
meeting
4
of
the
board
of
directors
or
any
committee
of
the
board
of
5
directors.
6
d.
The
board
of
directors
of
a
domestic
insurer
shall
7
establish
one
or
more
committees
comprised
solely
of
directors
8
who
are
not
officers
or
employees
of
the
insurer
or
of
any
9
entity
controlling,
controlled
by,
or
under
common
control
with
10
the
insurer
and
who
are
not
beneficial
owners
of
a
controlling
11
interest
in
the
voting
stock
of
the
insurer
or
any
such
entity.
12
The
committee
or
committees
shall
have
responsibility
for
13
recommending
or
nominating
candidates
for
director
for
election
14
by
shareholders
or
policyholders,
evaluating
the
performance
15
of
officers
deemed
to
be
principal
officers
of
the
insurer,
16
and
recommending
to
the
board
of
directors
the
selection
and
17
compensation
of
the
principal
officers.
18
e.
The
provisions
of
paragraphs
“c”
and
“d”
shall
not
apply
19
to
a
domestic
insurer
if
the
person
controlling
the
insurer,
20
such
as
an
insurer,
a
mutual
insurance
holding
company,
or
21
a
publicly
held
corporation,
has
a
board
of
directors
and
22
committees
of
the
board
of
directors
that
meet
the
requirements
23
of
paragraphs
“c”
and
“d”
with
respect
to
such
controlling
24
entity.
25
f.
An
insurer
may
make
application
to
the
commissioner
26
for
a
waiver
from
the
requirements
of
this
subsection
if
27
the
insurer’s
annual
direct
written
and
assumed
premium,
28
excluding
premiums
reinsured
with
the
federal
crop
insurance
29
corporation
and
federal
flood
program,
is
less
than
three
30
hundred
million
dollars.
An
insurer
may
also
make
application
31
to
the
commissioner
for
a
waiver
from
the
requirements
of
this
32
subsection
based
upon
unique
circumstances.
The
commissioner
33
may
consider
various
factors
including
but
not
limited
to
34
the
type
of
business
entity,
volume
of
business
written,
35
-9-
SF
2104
(3)
85
av/nh/jh
9/
17
S.F.
2104
availability
of
qualified
board
members,
or
the
ownership
or
1
organizational
structure
of
the
entity.
2
Sec.
18.
Section
521A.6,
Code
2014,
is
amended
to
read
as
3
follows:
4
521A.6
Examination.
5
1.
Power
of
commissioner.
Subject
to
the
limitation
6
contained
in
this
section
and
in
addition
to
the
powers
7
which
the
commissioner
has
under
chapter
507
relating
to
the
8
examination
of
insurers,
the
commissioner
may
also
order
an
9
insurer
registered
under
section
521A.4
to
produce
records,
10
books,
or
other
information
papers
in
the
possession
of
the
11
insurer
or
its
affiliates
as
reasonably
necessary
to
ascertain
12
the
financial
condition
of
the
insurer
or
to
determine
13
compliance
with
this
chapter
.
If
the
insurer
fails
to
comply
14
with
the
order,
the
commissioner
may
examine
the
affiliates
15
to
obtain
the
information
shall
have
the
power
to
examine
any
16
insurer
registered
under
section
521A.4
and
its
affiliates
to
17
ascertain
the
financial
condition
of
the
insurer,
including
18
the
enterprise
risk
to
the
insurer
by
the
ultimate
controlling
19
party,
or
by
any
entity
or
combination
of
entities
within
the
20
insurance
holding
company
system,
or
by
the
insurance
holding
21
company
system
on
a
consolidated
basis
.
22
2.
Access
to
books
and
records
——
penalty.
23
a.
The
commissioner
may
order
an
insurer
registered
under
24
section
521A.4
to
produce
records,
books,
or
other
information
25
papers
in
the
possession
of
the
insurer
or
its
affiliates
as
26
reasonably
necessary
or
to
determine
compliance
with
this
27
chapter.
28
b.
To
determine
compliance
with
this
chapter,
the
29
commissioner
may
order
any
insurer
registered
under
section
30
521A.4
to
produce
information
not
in
the
possession
of
the
31
insurer
if
the
insurer
can
obtain
access
to
such
information
32
pursuant
to
a
contractual
relationship,
statutory
obligation,
33
or
other
method.
In
the
event
the
insurer
cannot
obtain
the
34
information
requested
by
the
commissioner,
the
insurer
shall
35
-10-
SF
2104
(3)
85
av/nh/jh
10/
17
S.F.
2104
provide
the
commissioner
a
detailed
explanation
of
the
reason
1
that
the
insurer
cannot
obtain
the
information
and
the
identity
2
of
the
holder
of
the
information.
Whenever
it
appears
to
the
3
commissioner
that
the
detailed
explanation
is
without
merit,
4
the
commissioner
may
require,
after
notice
and
hearing,
the
5
insurer
to
pay
a
penalty
of
five
hundred
dollars
for
each
day’s
6
delay,
or
may
suspend
or
revoke
the
insurer’s
certificate
of
7
authority.
8
3.
Compelling
production.
In
the
event
the
insurer
fails
9
to
comply
with
an
order,
the
commissioner
shall
have
the
power
10
to
examine
the
affiliates
to
obtain
the
information.
The
11
commissioner
shall
also
have
the
power
to
issue
subpoenas,
to
12
administer
oaths,
and
to
examine
under
oath
any
person
for
13
purposes
of
determining
compliance
with
this
section.
Upon
14
the
failure
or
refusal
of
any
person
to
obey
a
subpoena,
the
15
commissioner
may
petition
a
court
of
competent
jurisdiction,
16
and
upon
proper
showing,
the
court
may
enter
an
order
17
compelling
the
witness
to
appear
and
testify
or
produce
18
documentary
evidence.
Failure
to
obey
the
court
order
shall
19
be
punishable
as
contempt
of
court.
Every
person
shall
be
20
obliged
to
attend
as
a
witness
at
the
place
specified
in
the
21
subpoena,
when
subpoenaed,
anywhere
within
the
state.
Such
22
a
person
shall
be
entitled
to
the
same
fees
and
mileage,
if
23
claimed,
as
a
witness
in
district
court,
which
fees,
mileage,
24
and
actual
expense,
if
any,
necessarily
incurred
in
securing
25
the
attendance
of
witnesses,
and
their
testimony,
shall
be
26
itemized
and
charged
against,
and
be
paid
by,
the
company
being
27
examined.
28
2.
4.
Use
of
consultants.
The
commissioner
may
retain
at
29
the
registered
insurer’s
expense
such
attorneys,
actuaries,
30
accountants
and
other
experts
not
otherwise
a
part
of
the
31
commissioner’s
staff
as
shall
be
reasonably
necessary
to
assist
32
in
the
conduct
of
the
examination
under
subsection
1
,
2,
or
3
33
of
this
section
.
Any
persons
so
retained
shall
be
under
the
34
direction
and
control
of
the
commissioner
and
shall
act
in
a
35
-11-
SF
2104
(3)
85
av/nh/jh
11/
17
S.F.
2104
purely
advisory
capacity.
1
3.
5.
Expenses.
Each
registered
insurer
producing
for
2
examination
records,
books
and
papers
pursuant
to
subsection
1
,
3
2,
or
3
of
this
section
shall
be
liable
for
and
shall
pay
the
4
expense
of
such
examination
in
accordance
with
section
507.7
.
5
Sec.
19.
NEW
SECTION
.
521A.6A
Supervisory
colleges.
6
1.
Power
of
commissioner.
With
respect
to
any
insurer
7
registered
under
section
521A.4
and
in
accordance
with
8
subsection
3
of
this
section,
the
commissioner
shall
have
9
the
power
to
participate
in
a
supervisory
college
for
any
10
domestic
insurer
that
is
part
of
an
insurance
holding
company
11
system
with
international
operations
in
order
to
determine
12
compliance
by
the
insurer
with
this
chapter.
The
powers
of
the
13
commissioner
with
respect
to
supervisory
colleges
include
but
14
are
not
limited
to
the
following:
15
a.
Initiating
the
establishment
of
a
supervisory
college.
16
b.
Clarifying
the
membership
and
participation
of
other
17
supervisors
in
the
supervisory
college.
18
c.
Clarifying
the
functions
of
the
supervisory
college
and
19
the
role
of
other
regulators,
including
the
establishment
of
a
20
group-wide
supervisor.
21
d.
Coordinating
the
ongoing
activities
of
the
supervisory
22
college,
including
planning
meetings,
supervisory
activities,
23
and
processes
for
information
sharing.
24
e.
Establishing
a
crisis
management
plan.
25
2.
Selection
of
group-wide
supervisor.
In
the
event
a
26
group-wide
supervisor
is
established
for
a
supervisory
college
27
as
described
in
subsection
1,
the
commissioner
is
authorized,
28
but
not
required,
to
act
as
the
group-wide
supervisor.
In
29
order
to
determine
whether
the
commissioner
or
another
chief
30
insurance
regulatory
official
is
the
appropriate
group-wide
31
supervisor,
the
commissioner
shall,
in
cooperation
with
other
32
supervisors,
consider
the
following
factors
and
the
relative
33
scale
of
each:
34
a.
The
extent
to
which
the
insurance
holding
company
35
-12-
SF
2104
(3)
85
av/nh/jh
12/
17
S.F.
2104
system’s
insurance
operations
are
domiciled
in
Iowa.
1
b.
The
location
where
the
insurance
holding
company
system
2
is
based
or
the
place
of
domicile
of
the
insurance
holding
3
company
system’s
ultimate
controlling
person.
4
c.
The
locations
of
the
insurance
holding
company
system’s
5
executive
offices.
6
d.
The
locations
of
origin
of
the
insurance
business
of
the
7
insurance
holding
company
system.
8
e.
The
locations
of
the
assets
and
liabilities
of
the
9
insurance
holding
company
system.
10
f.
The
locations
of
the
business
operations
and
activities
11
of
the
insurance
holding
company
system.
12
g.
Whether
another
chief
insurance
regulatory
official
is
13
acting
or
seeking
to
act
as
the
lead
group-wide
supervisor
14
under
a
regulatory
system
that
the
commissioner
determines
to
15
be
either
of
the
following:
16
(1)
Substantially
similar
to
that
provided
under
the
laws
of
17
the
state
of
Iowa.
18
(2)
Otherwise
sufficient
in
terms
of
provision
of
19
group-wide
supervision,
enterprise
risk
analysis,
and
20
cooperation
with
other
chief
insurance
regulatory
officials.
21
h.
Whether
a
chief
insurance
regulatory
official
acting
22
or
seeking
to
act
as
the
lead
group-wide
supervisor
provides
23
the
commissioner
with
reasonably
reciprocal
recognition
and
24
cooperation.
25
3.
Commissioner
as
group-wide
supervisor.
If
the
26
commissioner
is
the
group-wide
supervisor
as
described
in
27
subsection
2,
the
commissioner
is
authorized
to
engage
in
28
conducting
and
coordinating
any
of
the
following
group-wide
29
supervision
activities:
30
a.
Assessing
the
enterprise
risks
within
the
international
31
insurance
group
in
accordance
with
the
“own
risk
and
solvency
32
assessments”
requirements
of
chapter
522.
33
b.
Requesting
from
any
member
of
an
international
insurance
34
group
subject
to
the
commissioner’s
supervision
information
35
-13-
SF
2104
(3)
85
av/nh/jh
13/
17
S.F.
2104
necessary
and
appropriate
to
assess
enterprise
risk
in
1
accordance
with
chapter
522.
2
c.
Communicating
with
other
insurance
regulatory
officials
3
regarding
members
within
the
international
insurance
group
and
4
sharing
relevant
information,
subject
to
the
confidentiality
5
provisions
of
section
521A.7,
through
supervisory
colleges
as
6
set
forth
in
this
section.
7
d.
Other
group-wide
supervisory
activities
as
considered
8
appropriate
by
the
commissioner
and
as
defined
by
the
9
commissioner
by
rule.
10
4.
Expenses
——
assessment.
Each
registered
insurer
11
subject
to
this
section
shall
be
liable
for
and
shall
pay
the
12
reasonable
expenses
of
the
commissioner’s
participation
in
a
13
supervisory
college
in
accordance
with
subsection
5,
including
14
reasonable
travel
expenses.
For
purposes
of
this
section,
15
a
supervisory
college
may
be
convened
as
either
a
temporary
16
or
permanent
forum
for
communication
and
cooperation
between
17
the
regulators
charged
with
the
supervision
of
the
insurer
or
18
its
affiliates,
and
the
commissioner
may
establish
a
regular
19
assessment
to
the
insurer
for
the
payment
of
these
expenses.
20
5.
Supervisory
college.
In
order
to
assess
the
business
21
strategy,
financial
position,
legal
and
regulatory
position,
22
risk
exposure,
risk
management
and
governance
processes,
23
and
as
part
of
the
examination
of
individual
insurers
24
in
accordance
with
section
521A.6,
the
commissioner
may
25
participate
in
a
supervisory
college
with
other
regulators
26
charged
with
supervision
of
an
insurer
or
its
affiliates,
27
including
other
state,
federal,
and
international
regulatory
28
agencies.
The
commissioner
may
enter
into
agreements
in
29
accordance
with
section
521A.7,
subsection
3,
providing
the
30
basis
for
cooperation
between
the
commissioner
and
the
other
31
regulatory
agencies,
and
the
activities
of
the
supervisory
32
college.
Nothing
in
this
section
shall
delegate
to
the
33
supervisory
college
the
authority
of
the
commissioner
to
34
regulate
or
supervise
the
insurer
or
its
affiliates
within
the
35
-14-
SF
2104
(3)
85
av/nh/jh
14/
17
S.F.
2104
commissioner’s
jurisdiction.
1
Sec.
20.
Section
521A.7,
Code
2014,
is
amended
to
read
as
2
follows:
3
521A.7
Confidential
treatment.
4
1.
All
information,
documents
,
and
copies
thereof
obtained
5
by
or
disclosed
to
the
commissioner
or
any
other
person
in
6
the
course
of
an
examination
or
investigation
made
pursuant
7
to
section
521A.6
or
521A.6A,
and
all
information
reported
8
pursuant
to
sections
521A.4
and
521A.5
,
shall
be
given
9
confidential
treatment
and
shall
not
be
subject
to
subpoena
10
and
shall
not
be
made
public
by
the
commissioner
or
any
other
11
person,
except
to
insurance
departments
of
other
states,
12
without
the
prior
written
consent
of
the
insurer
to
which
it
13
pertains
unless
the
commissioner,
after
giving
the
insurer
14
and
its
affiliates
who
would
be
affected
thereby,
notice
and
15
opportunity
to
be
heard,
determines
that
the
interests
of
16
policyholders,
shareholders
,
or
the
public
will
be
served
17
by
the
publication
thereof,
in
which
event
the
commissioner
18
may
publish
all
or
any
part
thereof
in
such
manner
as
the
19
commissioner
may
deem
appropriate.
20
2.
Neither
the
commissioner
nor
any
person
who
received
21
documents,
materials,
or
other
information
while
acting
under
22
the
authority
of
the
commissioner
or
with
whom
such
documents,
23
materials,
or
other
information
are
shared
pursuant
to
this
24
chapter
shall
be
permitted
or
required
to
testify
in
any
25
private
civil
action
concerning
any
confidential
documents,
26
materials,
or
other
information
subject
to
subsection
1.
27
3.
In
order
to
assist
in
the
performance
of
the
28
commissioner’s
duties,
the
commissioner:
29
a.
May
share
documents,
materials,
or
other
information,
30
including
the
confidential
and
privileged
documents,
materials,
31
or
information
subject
to
subsection
1,
with
other
state,
32
federal,
and
international
regulatory
agencies,
with
the
33
national
association
of
insurance
commissioners
and
its
34
affiliates
and
subsidiaries,
and
with
state,
federal,
and
35
-15-
SF
2104
(3)
85
av/nh/jh
15/
17
S.F.
2104
international
law
enforcement
authorities,
including
members
1
of
any
supervisory
college
described
in
section
521A.6A,
2
provided
that
the
recipient
agrees
in
writing
to
maintain
3
the
confidentiality
and
privileged
status
of
the
document,
4
material,
or
other
information,
and
has
verified
in
writing
the
5
legal
authority
to
maintain
confidentiality.
6
b.
Notwithstanding
paragraph
“a”
,
the
commissioner
may
only
7
share
confidential
and
privileged
documents,
materials,
or
8
information
filed
pursuant
to
section
521A.4,
subsection
11A,
9
with
commissioners
of
states
having
statutes
or
regulations
10
substantially
similar
to
subsection
1
of
this
section
and
who
11
have
agreed
in
writing
not
to
disclose
such
information.
12
c.
May
receive
documents,
materials,
or
information,
13
including
otherwise
confidential
and
privileged
documents,
14
materials,
or
information
from
the
national
association
of
15
insurance
commissioners
and
its
affiliates
and
subsidiaries
and
16
from
regulatory
and
law
enforcement
officials
of
other
foreign
17
or
domestic
jurisdictions,
and
shall
maintain
as
confidential
18
or
privileged
any
document,
material,
or
information
received
19
with
notice
or
the
understanding
that
it
is
confidential
or
20
privileged
under
the
laws
of
the
jurisdiction
that
is
the
21
source
of
the
document,
material,
or
information.
22
d.
Shall
enter
into
written
agreements
with
the
national
23
association
of
insurance
commissioners
governing
sharing
and
24
use
of
information
provided
pursuant
to
this
chapter
consistent
25
with
this
subsection
that
shall
do
all
of
the
following:
26
(1)
Specify
procedures
and
protocols
regarding
the
27
confidentiality
and
security
of
information
shared
with
28
the
national
association
of
insurance
commissioners
and
29
subsidiaries
pursuant
to
this
chapter,
including
procedures
30
and
protocols
for
sharing
by
the
association
with
other
state,
31
federal,
or
international
regulators.
32
(2)
Specify
that
ownership
of
information
shared
with
33
the
national
association
of
insurance
commissioners
and
its
34
affiliates
and
subsidiaries
pursuant
to
this
chapter
remains
35
-16-
SF
2104
(3)
85
av/nh/jh
16/
17
S.F.
2104
with
the
commissioner
and
the
association’s
use
of
the
1
information
is
subject
to
the
direction
of
the
commissioner.
2
(3)
Require
prompt
notice
to
be
given
to
an
insurer
whose
3
confidential
information
in
the
possession
of
the
national
4
association
of
insurance
commissioners
pursuant
to
this
chapter
5
is
subject
to
a
request
or
subpoena
to
the
association
for
6
disclosure
or
production.
7
(4)
Require
the
national
association
of
insurance
8
commissioners
and
its
affiliates
and
subsidiaries
to
consent
to
9
intervention
by
an
insurer
in
any
judicial
or
administrative
10
action
in
which
the
association
and
its
affiliates
and
11
subsidiaries
may
be
required
to
disclose
confidential
12
information
about
the
insurer
shared
with
the
association
and
13
its
affiliates
and
subsidiaries
pursuant
to
this
chapter.
14
4.
The
sharing
of
information
by
the
commissioner
pursuant
15
to
this
chapter
shall
not
constitute
a
delegation
of
regulatory
16
authority
or
rulemaking,
and
the
commissioner
is
solely
17
responsible
for
the
administration,
execution,
and
enforcement
18
of
the
provisions
of
this
chapter.
19
5.
No
waiver
of
any
applicable
privilege
or
claim
of
20
confidentiality
in
the
documents,
materials,
or
information
21
shall
occur
as
a
result
of
disclosure
to
the
commissioner
22
under
this
section
or
as
a
result
of
sharing
as
authorized
in
23
subsection
3.
24
6.
Documents,
materials,
or
other
information
in
the
25
possession
or
control
of
the
national
association
of
insurance
26
commissioners
pursuant
to
this
chapter
shall
be
confidential
27
by
law
and
privileged,
shall
not
be
subject
to
chapter
22,
28
shall
not
be
subject
to
subpoena,
and
shall
not
be
subject
29
to
discovery
or
admissible
in
evidence
in
any
private
civil
30
action.
31
-17-
SF
2104
(3)
85
av/nh/jh
17/
17
