CHAPTER 3. GENERAL POWERS AND DUTIES OF THE DEPARTMENT
IC 27-1-3
Chapter 3. General Powers and Duties of the Department
IC 27-1-3-1
Exemption from individual liability
Sec. 1. Neither the insurance commissioner nor the several
officers and employees of the department shall be liable, in their
individual capacity, except to the state of Indiana, for any act done
or omitted in connection with the performance of their respective
duties under the provisions of this article.
(Formerly: Acts 1935, c.162, s.8.) As amended by P.L.252-1985,
SEC.5.
IC 27-1-3-2
Conflicts of interest
Sec. 2. Neither the insurance commissioner, during his term of
office, nor any deputy, actuary, securities clerk, examiner or
employee shall be directly or indirectly interested in any insurance
company, except as an ordinary policyholder.
(Formerly: Acts 1935, c.162, s.9.)
IC 27-1-3-3
Seal of department
Sec. 3. The department of insurance shall have an official seal of
such design as may be approved by the insurance commissioner.
(Formerly: Acts 1935, c.162, s.10.)
IC 27-1-3-4
Business practices of insurance companies
Sec. 4. Every insurance company to which this article is
applicable:
(1) shall conduct and transact its business in a safe and prudent
manner;
(2) shall maintain such company in a safe and solvent condition;
and
(3) shall establish and maintain safe and sound methods for the
conduct of such insurance company and its business and
prudential affairs.
(Formerly: Acts 1935, c.162, s.11.) As amended by P.L.252-1985,
SEC.6.
IC 27-1-3-5
Certified copies of documents and commissioner's certification of
facts as prima facie evidence
Sec. 5. Copies of all certificates, documents, reports, or other
papers lawfully received and filed by the department pursuant to this
article or any other law of this state, when duly certified by the
commissioner or any deputy and authenticated by the official seal of
the department, shall be taken and received in all courts and places
as prima facie evidence of the facts therein stated, and a certificate
from the commissioner under the official seal of the department as
to the existence or nonexistence of the facts relating to any insurance
company which would not appear from a certified copy of any paper
lawfully filed with the department shall be taken and received in all
courts and places as prima facie evidence of the existence or
nonexistence of the facts therein stated.
(Formerly: Acts 1935, c.162, s.12.) As amended by P.L.252-1985,
SEC.7.
IC 27-1-3-6
Commissioner's annual report
Sec. 6. During December the commissioner shall report to the
governor the names of all insurance companies which are in the
charge of the department for rehabilitation, liquidation or
conservation and such information in regard to those companies as
the commissioner may deem pertinent.
(Formerly: Acts 1935, c.162, s.13.) As amended by Acts 1979,
P.L.17, SEC.54.
IC 27-1-3-7
Rules and regulations
Sec. 7. (a) The department may promulgate rules and regulations
for any of the following enumerated purposes:
(1) For the conduct of the work of the department.
(2) Prescribing the methods and standards to be used in making
the examinations and prescribing the forms of reports of the
several insurance companies to which IC 27-1 is applicable.
(3) Defining what is a safe or an unsafe manner and a safe or an
unsafe condition for conducting business by any insurance
company to which IC 27-1 is applicable.
(4) For the establishment of safe and sound methods for the
transaction of business by such insurance companies and for the
purpose of safeguarding the interests of policyholders,
creditors, and shareholders respecting the withdrawal or
payment of funds by any life insurance company in times of
emergency. Any rule or regulation promulgated under this
subdivision may apply to one (1) or more insurance companies
as the department may determine.
(5) For the administration and termination of the affairs of any
such insurance company which is in involuntary liquidation or
whose business and property have been taken possession of by
the department for the purpose of rehabilitation, liquidation,
conservation, or dissolution under IC 27-1.
(6) For the regulation of the solicitation or use of proxies, in
general and as they concern consents or authorizations, in
respect of securities issued by any domestic stock company for
the purpose of protecting investors by prescribing the form of
proxies, including such consents or authorizations, and by
requiring adequate disclosure of information relevant to such
proxies, including such consents or authorizations, and relevant
to the business to be transacted at any meeting of shareholders
with respect to which such proxies, including such consents or
authorizations, may be used, which regulations may, in general,
conform to those prescribed by the National Association of
Insurance Commissioners.
(b) The department may adopt a rule under IC 4-22-2 to provide
reasonable simplification of the terms and coverage of individual and
group Medicare supplement accident and sickness insurance policies
and individual and group Medicare supplement subscriber contracts
in order to facilitate public understanding and comparison and to
eliminate provisions contained in those policies or contracts which
may be misleading or confusing in connection either with the
purchase of those coverages or with the settlement of claims and to
provide for full disclosure in the sale of those coverages.
(Formerly: Acts 1935, c.162, s.14; Acts 1965, c.178, s.1.) As
amended by Acts 1978, P.L.2, SEC.2702; Acts 1980, P.L.168, SEC.1;
Acts 1981, P.L.233, SEC.1; Acts 1982, P.L.159, SEC.1;
P.L.114-1991, SEC.8.
IC 27-1-3-8
Repealed
(Repealed by P.L.26-1991, SEC.28.)
IC 27-1-3-9
Repealed
(Repealed by P.L.26-1991, SEC.28.)
IC 27-1-3-10
Power to revoke or suspend certificate of authority
Sec. 10. The commissioner shall have power:
(1) to revoke or suspend the authority to do business in this
state of any company which refuses to permit an examination
under IC 27-1-3.1; and
(2) to revoke or suspend any certificate of authority when any
condition prescribed by law for granting it no longer exists.
(Formerly: Acts 1935, c.162, s.17.) As amended by P.L.26-1991,
SEC.3.
IC 27-1-3-10.5
Disclosure of information
Sec. 10.5. (a) As used in this section, "confidential information"
means information that has been designated as confidential by
statute, rule, or regulation issued under a statute.
(b) The commissioner may not:
(1) disclose; or
(2) subject to subpoena;
financial information regarding material transactions disclosed by an
insurer under IC 27-2-18.
(c) The commissioner may not disclose any information, including
any document or report received from:
(1) the National Association of Insurance Commissioners; or
(2) an insurance department of another state;
if the information is designated as confidential information in the
other jurisdiction.
(d) The commissioner may share confidential information with:
(1) the National Association of Insurance Commissioners; or
(2) an insurance department of another state;
on the condition that the National Association of Insurance
Commissioners and the other state agree to maintain the same level
of confidentiality that is provided to the information under Indiana
law.
As added by P.L.251-1995, SEC.1.
IC 27-1-3-11
Confidential information
Sec. 11. (a) The commissioner or any deputy, actuary, assistant,
examiner, or employee or any other person having access to any
information obtained through an examination conducted under
IC 27-1-3.1 may not disclose to any person, other than officially to
the department, by the report made to it, or to the board of directors,
trustees, partners, attorney-in-fact, or owners, or in compliance with
an order of a court, any information concerning the affairs of any
insurance company as shown by the report of the examination of
such company by the department. However, this prohibition against
disclosure does not apply after the report of the examiners has been
submitted to the department and the department has in turn submitted
the report with its recommendations, if any, to the board of directors,
trustees, partners, attorney-in-fact, or owners.
(b) This section does not prohibit the publication by any company
of the facts contained in its own examination.
(Formerly: Acts 1935, c.162, s.18; Acts 1969, c.164, s.6.) As
amended by Acts 1978, P.L.2, SEC.2703; P.L.17-1984, SEC.7;
P.L.159-1986, SEC.1; P.L.26-1991, SEC.4.
IC 27-1-3-12
Acceptance of examination made by another state
Sec. 12. The department may in its discretion accept any
examination of any insurance company made by the commissioners'
convention or by the proper authority of the state in which a foreign
or alien company is domiciled in lieu of the examination made under
the provisions of this article.
(Formerly: Acts 1935, c.162, s.19.) As amended by P.L.252-1985,
SEC.9.
IC 27-1-3-13
Blanks for annual statement; separate exhibit
Sec. 13. (a) Each company authorized to conduct business in
Indiana and required to file an annual statement with the department
under IC 27-1-20-21 shall submit the company's statement on the
National Association of Insurance Commissioners (NAIC) Annual
Statement Blank prepared in accordance with NAIC Annual
Statement Instructions, and following practices and procedures
prescribed by the most recent NAIC Accounting Practices and
Procedures Manual.
(b) To the extent that the NAIC Annual Statement Instructions
require disclosure under subsection (a) of compensation paid to or on
behalf of an insurer's officers, directors, or employees, the
information may be filed with the department as an exhibit separate
from the annual statement blank. The compensation information
described under this subsection shall be maintained by the
department as confidential and may not be made public.
(Formerly: Acts 1935, c.162, s.20; Acts 1963, c.154, s.1.) As
amended by P.L.130-1994, SEC.1; P.L.116-1994, SEC.5;
P.L.251-1995, SEC.2.
IC 27-1-3-14
Notice of insolvency, failure, or suspension of operations; failure to
give notice
Sec. 14. If any domestic insurance company is insolvent, or in
imminent danger of insolvency, or fails or suspends operation
between the periods of examination authorized, it is a Class B
misdemeanor for the highest officer then actively in charge of such
domestic insurance company to knowingly fail to notify the
department immediately, of such condition, failure, or suspension.
(Formerly: Acts 1935, c.162, s.21.) As amended by Acts 1978, P.L.2,
SEC.2704.
IC 27-1-3-15
Filing fees; collection
Sec. 15. (a) Except as provided in subsections (f) and (h), the
commissioner shall collect the following filing fees:
Document Fee
Articles of incorporation $
350
Amendment of articles of
incorporation $
10
Filing of annual statement
and consolidated statement $
100
Annual renewal of company license
fee $
50
Withdrawal of certificate
of authority $
25
Certified statement of condition $
5
Any other document required to be
filed by this article $
25
The commissioner shall deposit fees collected under this subsection
into the department of insurance fund established by section 28 of
this chapter.
(b) The commissioner shall collect a fee of ten dollars ($10) each
time process is served on the commissioner under this title.
(c) The commissioner shall collect the following fees for copying
and certifying the copy of any filed document relating to a domestic
or foreign corporation:
Per page for copying As determined by
the commissioner
but not to exceed
actual cost
For the certificate $10
(d) Each domestic and foreign insurer and each health
maintenance organization shall remit annually to the commissioner
for deposit into the department of insurance fund established by
section 28 of this chapter one thousand dollars ($1,000) as an
internal audit fee. All assessment insurers, farm mutuals, and
fraternal benefit societies shall remit to the commissioner for deposit
into the department of insurance fund two hundred fifty dollars
($250) annually as an internal audit fee.
(e) Beginning July 1, 1994, each insurer shall remit to the
commissioner for deposit into the department of insurance fund
established by section 28 of this chapter a fee of thirty-five dollars
($35) for each policy, rider, rule, rate, or endorsement filed with the
state, including subsequent filings. Except as provided in subsection
(f), each policy, rider, rule, rate, or endorsement that is filed as part
of a particular product filing or in association with a particular
product filing is an individual filing subject to the fee under this
subsection. However, the total amount of fees paid under this
subsection by each insurer for a particular product filing may not
exceed one thousand dollars ($1,000).
(f) Beginning July 1, 2009, a policy, rider, rule, rate, or
endorsement that is filed as part of a particular product filing or in
association with a particular product filing for a commercial product
described in:
(1) Class 2(b), Class 2(c), Class 2(d), Class 2(e), Class 2(f),
Class 2(g), Class 2(h), Class 2(i), Class 2(j), Class 2(k), Class
2(l), or Class 2(m) of IC 27-1-5-1; or
(2) Class 3 of IC 27-1-5-1;
is considered to be part of a single filing for which the insurer is
subject only to one (1) thirty-five dollar ($35) fee under subsection
(e).
(g) The commissioner shall pay into the state general fund by the
end of each calendar month the amounts collected during that month
under subsections (b) and (c).
(h) The commissioner may not collect fees for quarterly
statements filed under IC 27-1-20-33.
(i) The commissioner may adopt rules under IC 4-22-2 to provide
for the accrual and quarterly billing of fees under this section.
(Formerly: Acts 1935, c.162, s.22.) As amended by P.L.31-1988,
SEC.9; P.L.130-1994, SEC.2; P.L.116-1994, SEC.6; P.L.91-1998,
SEC.3; P.L.268-1999, SEC.1; P.L.203-2001, SEC.4; P.L.173-2007,
SEC.6; P.L.234-2007, SEC.188; P.L.3-2008, SEC.207.
IC 27-1-3-16
Disposition of taxes and fees collected; payment of expenses
Sec. 16. All taxes provided by this article and all fees accruing to
the department as provided in this article shall be paid into the state
treasury monthly. All expenses incurred and all compensation paid
by the department in the administration of this article shall be paid
out of the general fund, in the same manner as other state expense
and compensation are paid.
(Formerly: Acts 1935, c.162, s.23.) As amended by P.L.252-1985,
SEC.10.
IC 27-1-3-17
Repealed
(Repealed by P.L.4-1988, SEC.17.)
IC 27-1-3-18
Solicitation for political assessments or contributions; violations
Sec. 18. It is a Class A misdemeanor for a person to knowingly
solicit from any officer or employee of the department any money or
other property for political assessments or contributions.
(Formerly: Acts 1935, c.162, s.25.) As amended by Acts 1978, P.L.2,
SEC.2705.
IC 27-1-3-19
Order to correct improper practices or remedy deficiencies;
actions to compel compliance
Sec. 19. (a) Whenever the commissioner determines that any
insurance company to which this article is applicable:
(1) is conducting its business contrary to law or in an unsafe or
unauthorized manner;
(2) has had its capital or surplus fund impaired or reduced
below the amount required by law; or
(3) has failed, neglected, or refused to observe and comply with
any order or rule of the department or commissioner;
then the commissioner may, by an order in writing addressed to the
board of directors, board of trustees, attorney in fact, partners, or
owners of or in any such insurance company, to direct the
discontinuance of any such illegal, unauthorized, or unsafe practice,
the restoration of an impairment to the capital or the surplus fund, or
the compliance with any such law, order, or rule of the department
or commissioner. The order shall be mailed to the last known
principal office of the insurance company by certified or registered
mail or delivered to an officer of the company and shall be
considered to be received by the insurance company three (3) days
after mailing or on the date of delivery.
(b) If the insurance company fails, neglects, or refuses to comply
with the terms of that order within thirty (30) days after its receipt by
the insurance company, or within a shorter period set out in the order
if the commissioner determines that an emergency exists, the
commissioner may, in addition to any other remedy conferred upon
the department or the commissioner by law, bring an action against
any such insurance company, its officers, and agents to compel that
compliance.
(c) The action shall be brought by the commissioner in the Marion
County circuit court. The action shall be commenced and prosecuted
in accordance with the Indiana Rules of Trial Procedure, and relief
for noncompliance of the order includes any remedy appropriate
under the facts, including injunction, preliminary injunction, and
temporary restraining order. In that action, a change of venue from
the judge, but no change of venue from the county, is permitted.
(Formerly: Acts 1935, c.162, s.26.) As amended by P.L.252-1985,
SEC.12; P.L.31-1988, SEC.10.
IC 27-1-3-20
Certificate of authority; issuance; necessity; removal of unqualified
officers or directors; violations; civil penalties
Sec. 20. (a) The commissioner may issue a certificate of authority
to any company when it shall have complied with the requirements
of the laws of this state so as to entitle it to do business herein. The
certificate shall be issued under the seal of the department
authorizing and empowering the company to make the kind or kinds
of insurance specified in the certificate. No certificate of authority
shall be issued until the commissioner has found that:
(1) the company has submitted a sound plan of operation; and
(2) the general character and experience of the incorporators,
directors, and proposed officers is such as to assure reasonable
promise of a successful operation, based on the fact that such
persons are of known good character and that there is no good
reason to believe that they are affiliated, directly or indirectly,
through ownership, control, management, reinsurance
transactions, or other insurance or business relations with any
person or persons known to have been involved in the improper
manipulation of assets, accounts, or reinsurance.
No certificate of authority shall be denied, however, under
subdivision (1) or (2) until notice, hearing, and right of appeal has
been given as provided in IC 4-21.5.
(b) Every company possessing a certificate of authority shall
notify the commissioner of the election or appointment of every new
director or principal officer, within thirty (30) days thereafter. If in
the commissioner's opinion such a new principal officer or director
does not meet the standards set forth in this section, he shall request
that the company effect the removal of such persons from office. If
such removal is not accomplished as promptly as under the
circumstances and in the opinion of the commissioner is possible,
then upon notice to both the company and such principal officer or
director and after notice, hearing, and right of appeal pursuant to
IC 4-21.5, and after a finding that such person is incompetent or
untrustworthy or of known bad character, the commissioner may
order the removal of such person from office and may, unless such
removal is promptly accomplished, suspend the company's certificate
of authority until there is compliance with such order.
(c) No company shall transact any business of insurance or hold
itself out as a company in the business of insurance in Indiana until
it shall have received a certificate of authority as prescribed in this
section.
(d) No company shall make, issue, deliver, sell, or advertise any
kind or kinds of insurance not specified in the company's certificate
of authority.
(e) Notwithstanding IC 27-1-2-4, a director or officer of a
company who knowingly, intentionally, or recklessly violates
subsection (c) or (d) commits a Class D felony.
(f) The commissioner shall impose a civil penalty of not more
than twenty-five thousand dollars ($25,000) on a director or officer
of a company that violates subsection (c) or (d). The amount imposed
must be proportionate to the costs incurred by the department of
insurance, other governmental entities, and the courts in regulating
the activity of the director, officer, or company who violates
subsection (c) or (d). A civil penalty imposed under this subsection
may be enforced in the same manner as a civil judgment.
(Formerly: Acts 1935, c.162, s.27; Acts 1967, c.127, s.1; Acts 1975,
P.L.278, SEC.1.) As amended by P.L.7-1987, SEC.135; P.L.67-1998,
SEC.1.
IC 27-1-3-21
Execution of instruments or documents
Sec. 21. All rules, regulations, notices, orders, deeds, assignments
and other instruments or documents issued, executed or promulgated
by the department shall be executed in the name of "the department
of insurance," on its behalf, by the insurance commissioner, or, in
case of his absence or disability, by a deputy insurance
commissioner, and shall be sealed with the official seal of the
department; but the commissioner may authorize the execution of
such deeds, assignments, releases, petitions, notices or any other
instruments or documents issued or executed by the department in
connection with the rehabilitation, liquidation or conservation of any
insurance company by such department in the name of "the
department of insurance," by any special deputy commissioner duly
appointed in charge of rehabilitation, liquidation or conservation of
any insurance company; and all such documents so executed by the
special deputy insurance commissioner need not bear the official seal
of the department.
(Formerly: Acts 1935, c.162, s.28.)
IC 27-1-3-22
Fraudulent insurance act; definition; liability
Sec. 22. (a) As used in this section, "fraudulent insurance act"
means:
(1) the preparation or presentation of a written statement as part
of, or in support of:
(A) a fraudulent application for the issuance or rating of a
policy of commercial insurance; or
(B) a fraudulent claim under a policy of commercial or
personal insurance; or
(2) the concealment, for the purpose of misleading, of
information concerning any fact material to an application or
claim described in subdivision (1).
(b) As used in this section, "fraudulent insurance act" includes the
act or omission of a person who, knowingly and with intent to
defraud, does any of the following:
(1) Presents, causes to be presented, or prepares with
knowledge or belief that it will be presented, to or by an insurer,
a reinsurer, a purported insurer or reinsurer, a broker, or an
agent of an insurer, reinsurer, purported insurer or reinsurer, or
broker, an oral or written statement that the person knows to
contain materially false information as part of, in support of, or
concerning any fact that is material to:
(A) an application for the issuance of an insurance policy;
(B) the rating of an insurance policy;
(C) a claim for payment or benefit under an insurance
policy;
(D) premiums paid on an insurance policy;
(E) payments made in accordance with the terms of an
insurance policy;
(F) an application for a certificate of authority;
(G) the financial condition of an insurer, a reinsurer, or a
purported insurer or reinsurer; or
(H) the acquisition of an insurer or a reinsurer;
or conceals any information concerning a subject set forth in
clauses (A) through (H).
(2) Solicits or accepts new or renewal insurance risks by or for
an insolvent insurer, reinsurer, or other entity regulated under
this title.
(3) Removes or attempts to remove:
(A) the assets;
(B) the record of assets, transactions, and affairs; or
(C) a material part of the assets or the record of assets,
transactions, and affairs;
of an insurer, a reinsurer, or another entity regulated under this
title, from the home office, other place of business, or place of
safekeeping of the insurer, reinsurer, or other regulated entity,
or conceals or attempts to conceal from the department assets
or records referred to in clauses (A) through (C).
(4) Diverts, attempts to divert, or conspires to divert funds of an
insurer, a reinsurer, another entity regulated under the Indiana
Code, or other persons, in connection with any of the following:
(A) The transaction of insurance or reinsurance.
(B) The conduct of business activities by an insurer, a
reinsurer, or another entity regulated under this title.
(C) The formation, acquisition, or dissolution of an insurer,
a reinsurer, or another entity regulated under this title.
(c) A person who acts without malice, fraudulent intent, or bad
faith is not subject to civil liability for filing a report or furnishing,
orally or in writing, other information concerning a suspected,
anticipated, or completed fraudulent insurance act if the report or
other information is provided to or received from any of the
following:
(1) The department or an agent, an employee, or a designee of
the department.
(2) Law enforcement officials or an agent or employee of a law
enforcement official.
(3) The National Association of Insurance Commissioners.
(4) Any agency or bureau of federal or state government
established to detect and prevent fraudulent insurance acts.
(5) Any other organization established to detect and prevent
fraudulent insurance acts.
(6) An agent, an employee, or a designee of an entity referred
to in subdivisions (3) through (5).
(d) This section does not abrogate or modify in any way any
common law or statutory privilege or immunity.
As added by P.L.159-1986, SEC.2. Amended by P.L.121-1992,
SEC.1.
IC 27-1-3-23
Civil actions; substantial justification
Sec. 23. (a) For the purposes of this section, a party is
"substantially justified" in initiating a civil action if the action had a
reasonable basis in law or fact at the time the action was initiated.
(b) If:
(1) a person or entity referred to in section 22(c) of this chapter,
or an employee or agent of a person or entity referred to in
section 22(c), is the prevailing party in a civil action for libel,
slander, or any other relevant tort arising out of the filing of a
report or the furnishing of information under section 22(c) of
this chapter; and
(2) the party who initiated the action was not substantially
justified in initiating the action;
the person, entity, employee, or agent referred to in subdivision (1)
is entitled to an award of attorney's fees and costs.
As added by P.L.121-1992, SEC.2.
IC 27-1-3-24
Declaration of dividend other than from earned surplus; approval
Sec. 24. (a) As used in this section, "earned surplus" means an
amount equal to the unassigned funds of an insurer as set forth in the
most recent annual statement of the insurer that is submitted to the
commissioner, excluding surplus arising from unrealized capital
gains or revaluation of assets.
(b) A domestic insurer may not:
(1) declare; or
(2) pay;
a dividend from any source of money other than earned surplus
unless the commissioner approves the payment of the dividend
before the dividend is paid.
As added by P.L.130-1994, SEC.3 and P.L.116-1994, SEC.7.
IC 27-1-3-25
Review of ordinary shareholder dividends to determine
reasonableness
Sec. 25. The department shall establish and maintain a procedure
under which the department, at least one (1) time each year, reviews
the ordinary shareholder dividends paid by each domestic insurer to
determine whether dividends paid by the insurer are reasonable in
relation to the following:
(1) The adequacy of the level of surplus as regards
policyholders of the insurer remaining after the payment of
dividends.
(2) The quality of the earnings of the insurer and the extent to
which the reported earnings of the insurer include extraordinary
items, such as surplus relief, reinsurance transactions, and
reserve destrengthening.
As added by P.L.130-1994, SEC.4 and P.L.116-1994, SEC.8.
IC 27-1-3-26
Order to limit ordinary shareholder dividends
Sec. 26. The department shall establish and follow a practice
under which the department issues an order to a domestic insurer to
limit the payment of ordinary shareholder dividends by the insurer if
the department determines that the surplus of the insurer as regards
policyholders:
(1) is not reasonable in relation to the outstanding liabilities of
the insurer; and
(2) is not adequate to the financial needs of the insurer.
As added by P.L.130-1994, SEC.5 and P.L.116-1994, SEC.9.
IC 27-1-3-27
Order to limit or disallow payment of ordinary shareholder
dividends
Sec. 27. The department shall establish and follow a practice
under which the department issues an order to limit or disallow the
payment of ordinary shareholder dividends by a domestic insurer if
the domestic insurer is found to be financially distressed or troubled.
As added by P.L.130-1994, SEC.6 and P.L.116-1994, SEC.10.
IC 27-1-3-28
Department of insurance fund; establishment; deposits
Sec. 28. (a) The department of insurance fund is established for
the following purposes:
(1) To provide supplemental funding for the operations of the
department of insurance.
(2) To pay the costs of hiring and employing staff.
(3) To provide staff salary differentials as necessary to equalize
the average salaries and staffing levels of the department of
insurance with the average salaries and staffing levels reported
in the most recent Insurance Department Resources Report
published by the National Association of Insurance
Commissioners.
(4) To enable the department of insurance to maintain
accreditation by the National Association of Insurance
Commissioners.
(5) To carry out any other purpose determined necessary by the
department of insurance to carry out the department's duties
under this title.
(b) The fund shall be administered by the commissioner. The
following shall be deposited in the department of insurance fund:
(1) Audit fees remitted by insurers to the commissioner under
section 15(d) of this chapter.
(2) Filing fees remitted by insurers to the commissioner under
section 15(a) or 15(e) of this chapter.
(3) Any other amounts remitted to the commissioner or the
department that are required by rule or statute to be deposited
into the department of insurance fund.
(c) The expenses of administering the fund shall be paid from
money in the fund.
(d) The treasurer of state shall invest the money in the fund not
currently needed to meet the obligations of the fund in the same
manner as other public funds may be invested. Interest that accrues
from these investments shall be deposited in the fund.
(e) Money in the fund at the end of a particular fiscal year does
not revert to the state general fund.
(f) There is annually appropriated to the department of insurance,
for the purposes set forth in subsection (a), the entire amount of
money deposited in the fund in each year.
As added by P.L.130-1994, SEC.7 and P.L.116-1994, SEC.11.
Amended by P.L.252-1995, SEC.1; P.L.91-1998, SEC.4;
P.L.173-2007, SEC.7; P.L.234-2007, SEC.189.
IC 27-1-3-29
Enforceability of policies exceeding authority of insurer or
violating statute or rule
Sec. 29. (a) Except as otherwise provided by statute, a policy is
enforceable against the insurer according to its terms, even if the
policy exceeds the authority of the insurer.
(b) A policy that violates a statute or rule is enforceable against
the insurer as if the policy conformed to the statute or rule.
(c) Upon the written request of the policyholder or the insured
whose rights under the policy are continuing and not transitory, an
insurer shall reform and reissue its written policy to comply with the
requirements of the law existing at the date of issue or last renewal
of the policy.
As added by P.L.268-1999, SEC.2.
IC 27-1-3-30
Mandated health benefit task force
Sec. 30. (a) As used in this section, "accident and sickness
insurance policy" has the meaning set forth in IC 27-8-14.2-1.
(b) As used in this section, "health maintenance organization" has
the meaning set forth in IC 27-13-1-19.
(c) As used in this section, "mandated benefit" means certain
health coverage or an offering of certain health coverage that is
required under:
(1) an accident and sickness insurance policy; or
(2) a contract with a health maintenance organization.
(d) As used in this section, "mandated benefit proposal" means a
bill or resolution pending before the general assembly that, if
enacted, would require certain health coverage or an offering of
certain health coverage under:
(1) an accident and sickness insurance policy; or
(2) a contract with a health maintenance organization.
(e) The commissioner shall establish a task force to review
mandated benefits and mandated benefit proposals.
(f) The task force must consist of ten (10) members appointed by
the governor as follows:
(1) Two (2) members representing the insurance industry.
(2) Two (2) members representing consumers.
(3) Two (2) members representing health care providers.
(4) Two (2) members representing the business sector.
(5) One (1) member who is an independent actuary.
(6) The commissioner or the commissioner's designee.
A registered lobbyist may not serve as a member of the task force.
(g) Each member of the task force who is not a state employee is
entitled to the minimum salary per diem provided by
IC 4-10-11-2.1(b). The member is also entitled to reimbursement for
traveling expenses as provided under IC 4-13-1-4 and other expenses
actually incurred in connection with the member's duties as provided
in the state policies and procedures established by the Indiana
department of administration and approved by the budget agency.
(h) Each member of the task force who is a state employee is
entitled to reimbursement for traveling expenses as provided under
IC 4-13-1-4 and other expenses actually incurred in connection with
the member's duties as provided in the state policies and procedures
established by the Indiana department of administration and
approved by the budget agency.
(i) Each member of the task force shall attend at least fifty percent
(50%) of scheduled meetings. A member who does not comply with
this subsection is subject to replacement by the governor.
(j) The department shall provide administrative and actuarial
support for the functions of the task force, including the use of the
services of the department's actuary as necessary for the completion
of the duties of the task force under this chapter.
(k) Upon the:
(1) request of the legislative services agency on behalf of a
member of the general assembly; or
(2) determination of the task force;
the task force shall assess the social, medical, and financial impacts
of at least one (1) mandated benefit or one (1) mandated benefit
proposal each year.
(l) In assessing a mandated benefit or mandated benefit proposal,
and to the extent that information is available, the task force shall
consider:
(1) social impacts, including:
(A) the extent to which the service that is the subject of the
mandated benefit or mandated benefit proposal is generally
used by a significant part of the population;
(B) the extent to which the health coverage is already
generally available;
(C) if the health coverage is not generally available, the
extent to which the lack of health coverage results in
unreasonable financial hardship;
(D) the level of public demand for the service that is the
subject of the mandated benefit or mandated benefit
proposal;
(E) the level of public demand for the health coverage; and
(F) the extent to which the service that is the subject of the
mandated benefit or mandated benefit proposal is covered
under self-funded health coverage provided by Indiana
employers that employ at least five hundred (500)
employees;
(2) medical impacts, including the extent to which the service
that is the subject of the mandated benefit or mandated benefit
proposal is generally:
(A) recognized by the medical community as effective in
patient treatment;
(B) demonstrated by a review of scientific and peer review
literature to be recognized by the medical community; and
(C) available and used by treating physicians; and
(3) financial impacts, including the:
(A) extent to which the health coverage will increase or
decrease the cost of the service that is the subject of the
mandated benefit or mandated benefit proposal;
(B) extent to which the health coverage will increase the
appropriate use of the service that is the subject of the
mandated benefit or mandated benefit proposal;
(C) extent to which the service that is the subject of the
mandated benefit or mandated benefit proposal will be a
substitute for a more expensive service;
(D) extent to which the health coverage will increase or
decrease the:
(i) administrative expenses of accident and sickness
insurers and health maintenance organizations; and
(ii) premium and administrative expenses of individuals
covered under accident and sickness insurance policies
and health maintenance organization contracts;
(E) impact of the health coverage on the total cost of health
care in Indiana, including any potential cost savings that may
be realized through the mandated benefit or mandated
benefit proposal;
(F) impact of all mandated benefits on the ability of
employers to purchase health coverage that meets employee
needs;
(G) extent to which the financial impact of all mandated
benefits, including the mandated benefit or mandated benefit
proposal under consideration, will affect employee wages
and compensation; and
(H) extent to which the financial impact of all mandated
benefits, including the mandated benefit or mandated benefit
proposal under consideration, will affect hiring practices of
Indiana employers.
(m) The task force shall annually determine the full cost of all
existing mandated benefits in Indiana as a percentage of:
(1) Indiana's average annual wage; and
(2) health coverage premiums.
(n) In making the annual determination under subsection (m), the
task force shall consider the full cost of existing mandated benefits
under:
(1) a typical group and individual:
(A) accident and sickness insurance policy; and
(B) health maintenance organization contract;
in Indiana; and
(2) the state employee health plans provided for in
IC 5-10-8-7(b) and IC 5-10-8-7(c).
(o) The task force may contract for professional services as
necessary for the completion of the duties of the task force under this
chapter.
(p) The task force shall report the findings of the task force in an
electronic format under IC 5-14-6 to the legislative council not later
than November 1 of each year.
(q) Any recommendations made by the task force must be
approved by at least six (6) members of the task force.
(r) The department may adopt rules under IC 4-22-2 to implement
this section.
(s) Information that identifies a person and that is obtained by the
task force under this section is confidential.
(t) This section expires December 31, 2010.
As added by P.L.166-2003, SEC.1. Amended by P.L.28-2004,
SEC.165; P.L.125-2005, SEC.1.
IC 27-1-3-31
Commissioner study and report concerning direct reimbursement
by health plans
Sec. 31. (a) Not later than September 1, 2009, each insurer that
issues a policy of accident and sickness insurance (as defined in
IC 27-8-5-1) and each health maintenance organization shall submit
to the commissioner specified data and information in a format
prescribed by the commissioner. If data or information from a health
care provider is determined to be necessary to complete the study
under subsection (b), the health care provider shall submit the data
or information to the commissioner.
(b) The commissioner shall study the data and information
submitted under subsection (a) and make actuarial determinations of
the savings and costs of implementation of direct reimbursement by
the insurers and health maintenance organizations to out-of-network
health care providers for health care services rendered to insureds
and enrollees.
(c) The commissioner shall specify the data and information to be
submitted under subsection (a) to reflect the following:
(1) The costs incurred or savings experienced by the insurer or
health maintenance organization in implementing direct
reimbursement to the health care providers.
(2) Operational costs incurred or savings experienced in
implementing direct reimbursement to the health care providers.
(3) The number of additional health care providers, by
specialty, that would be reimbursed by the insurer or health
maintenance organization after the insurer or health
maintenance organization implemented direct reimbursement.
(4) Any other costs or savings that an insurer, a health
maintenance organization, the commissioner, or the chairperson
of the health finance commission established by IC 2-5-23-3
determines to be relevant to direct reimbursement.
(d) The commissioner shall report the results of the study and
actuarial determinations made under subsection (b) to the health
finance commission in an electronic format under IC 5-14-6 before
October 15, 2009.
(e) Data and information submitted, and results of the study and
actuarial determinations made, under this section that identify an
individual insurer, health maintenance organization, health care
provider, or individual are confidential. However, upon request of
the chairperson of the health finance commission, the commissioner
shall:
(1) remove identifying information from; and
(2) provide, to the legislative services agency and members of
the health finance commission;
the data and information submitted under subsection (a).
(f) This section expires December 31, 2009.
As added by P.L.144-2009, SEC.1.