ORIGINAL SENATE                                          

FILE   NO.  0028

 

ENROLLED ACT NO. 4,  SENATE

 

FIFTY-SIXTH LEGISLATURE OF THE STATE OF WYOMING

2001 GENERAL SESSION

 

 

 

 

AN ACT relating to insurance; specifying requirements for
accounting practices and procedures for financial reporting
by insurance companies and other insuring entities;
modifying allowable assets and other determinations
relating to insurance companies' and other insuring
entities' financial status by requiring conformance with
National Association of Insurance Commissioners' standards;
authorizing the insurance commissioner to receive and share
confidential and privileged materials as specified; making
conforming amendments; and providing for an effective date.

 

Be It Enacted by the Legislature of the State of Wyoming:

 

Section 1.  W.S. 26-1-102(a) by creating a new
paragraph (xxxv), 26-2-113 by creating a new subsection
(d), 26-2-121(k) and (m), 26-3-123(d), 26-3-203,
26-3-304(b)(vi)(intro), 26-3-401(d)(i), 26-6-101(a)(intro),
26-6-102(a)(intro), 26-6-103(a)(intro), 26-6-106,
26-6-208(e)(vii)(intro), 26-6-301(a)(iii), 26-6-302(a) and
(b), 26-6-303(a)(intro), 26-6-304, 26-7-110(a)(i),
26-23-102(c), 26-23-309(f), 26-26-120(a),
26-27-117(a)(intro), 26-29-226(a), 26-34-110(a) and (b)(i),
26-34-130(d) and 26-44-110 are amended to read:

 

26-1-102.  Definitions.

 

(a)  As used in this act:

 

(xxxv)  "Fair value", "fair market value" or
"market value" mean fair value as determined pursuant to
the most recent National Association of Insurance
Commissioners' accounting practices and procedures manual.

 

26-2-113.  Records and other papers; generally.

 

 

Page  1

 

 

 

(d)  In order to assist in the performance of his
duties under this code, the commissioner may:

 

(i)  Share documents, materials or other
information, including confidential and privileged
documents, materials or information, with other state,
federal and international regulatory agencies, with the
National Association of Insurance Commissioners, its
affiliates or subsidiaries, and with state, federal and
international law enforcement authorities, provided the
recipient agrees to maintain the confidentiality and
privileged status of any document, material or other
information;

 

(ii)  Receive documents, materials or
information, including otherwise confidential and
privileged documents, materials or information, from the
National Association of Insurance Commissioners, its
affiliates or 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)  Enter into agreements governing sharing
and use of information consistent with this subsection.

 

26-2-121.  Examinations; report; contents.

 

(k)  Nothing contained in W.S. 26-2-116 through
26-2-124 shall require the department to disclose any
information or records which would indicate or show the
existence or content of any investigation or activity of a
criminal justice agency. Nothing contained in this code

 

Page  2

 

 

 

shall prevent or be construed as prohibiting the
commissioner from disclosing the content of an examination
report, preliminary examination report or results, or any
matter relating thereto, to the insurance department of
this or any other state or country, or to law enforcement
officials of this or any other state or agency of the
federal government at any time, so long as the agency or
office receiving the report or matters relating thereto
agrees in writing to hold it confidential and in a manner
consistent with this act as authorized by and in accordance
with the provisions of W.S. 26-2-113(d). In the event the
commissioner determines that regulatory action is
appropriate as a result of any examination, he may initiate
any proceedings or actions as provided by law. The
provisions of W.S. 26-2-116 through 26-2-124 with regard to
release of information shall prevail should any conflict
arise between this act and W.S. 16-4-201 through 16-4-205.

 

(m)  All working papers, recorded information,
documents and copies thereof produced by, obtained by or
disclosed to the commissioner or any other person in the
course of an examination made under W.S. 26-2-116 through
26-2-124 shall be given confidential treatment and are not
subject to subpoena and shall not be made public by the
commissioner or any other person, except to the extent
provided in subsections (j) and (k) of this section. Access
may also be granted to the National Association of
Insurance Commissioners.  The parties shall agree in
writing prior to receiving the information to provide to it
the same confidential treatment as required by this
section, unless the prior written consent of the insurer to
which it pertains has been obtained.

 

26-3-123.  Annual and quarterly statement; required;
form; verification; failure to file.

 

Page  3

 

 

 

(d)  All annual and quarterly statements filed
pursuant to this section shall be completed pursuant to the
most recent National Association of Insurance
Commissioners' accounting practices and procedures manual
and accompanied by a computer diskette containing the same
information as the statement. The commissioner may specify
the size and format of the computer diskette.  The
commissioner may refuse to continue or may suspend or
revoke the certificate of authority of any insurer failing
to file its annual or quarterly statement when due.

 

26-3-203.  Confidentiality.

 

All financial analysis ratios and examination synopsis
concerning insurance companies that are submitted to the
department by the National Association of Insurance
Commissioners' Insurance Regulatory Information System are
confidential and shall not be disclosed by the department
except as authorized by and in accordance with the
provisions of W.S. 26-2-113(d).

 

26-3-304.  Contents of annual audited financial
report.

 

(b)  The annual audited financial report shall include
the following:

 

(vi)  Notes to financial statements.  The notes
shall be those required by the appropriate National
Association of Insurance Commissioners' annual statement
instructions and any other notes required by generally
accepted accounting principles and the most recent National
Association of Insurance Commissioners' accounting
practices and procedures manual. The notes shall also
include:

 

Page  4

 

 

 

26-3-401.  Report of material transactions.

 

(d)  All reports obtained by or disclosed to the
commissioner pursuant to this article shall be given
confidential treatment, and shall not be made public by the
commissioner, the National Association of Insurance
Commissioners, or any other person, except:

 

(i)  To insurance departments of other states
persons as authorized by and in accordance with the
provisions of W.S. 26-2-113(d);

 

26-6-101.  Assets allowed.

 

(a)  In any determination of an insurer's financial
condition, only the following insurer owned assets set
forth and allowed in the most recent National Association
of Insurance Commissioners' accounting practices and
procedures manual or authorized in accordance with this
section shall be allowed: as assets. Assets not
inconsistent with this article shall be allowed at values
the commissioner determines, if he deems them available for
the payment of losses and claims.

 

26-6-102.  Assets not allowed.

 

(a)  In addition to assets impliedly excluded by the
most recent National Association of Insurance
Commissioners' accounting practices and procedures manual
pursuant to W.S. 26-6-101, the following are not allowed as
assets in any determination of an insurer's financial
condition:

 

26-6-103.  Liabilities generally.

 

Page  5

 

 

 

(a)  In any determination of an insurer's financial
condition, capital stock and liabilities to be charged
against its assets include the capital stock and liability
items set forth in the most recent National Association of
Insurance Commissioners' accounting practices and
procedures manual and the following:

 

26-6-106.  Unearned premium reserve; marine and
transportation insurance.

 

As to marine and transportation insurance, the entire
amount of premiums on trip risks not terminated are deemed
unearned. The commissioner may require the insurer to carry
a reserve equal to one hundred percent (100%) of premiums
on trip risks written during the month ended as of the date
of statement unearned premium reserve shall be determined
pursuant to the most recent National Association of
Insurance Commissioners' accounting practices and
procedures manual.

 

26-6-208.  Actuarial opinion of reserves.

 

(e)  Every opinion shall be governed by the following
provisions:

 

(vii)  Any memorandum in support of the opinion,
and any other material provided by the insurer to the
commissioner in connection with the opinion, shall be kept
confidential by the commissioner, may be shared as
authorized by and in accordance with the provisions of W.S.
26-2-113(d), and shall not be made public other than for
the purpose of defending an action seeking damages from any
person by reason of any action required by this section or
by regulations promulgated under this section.  Once any
portion of the confidential memorandum is cited by the
insurer in its marketing or is cited before any

Page  6

 

 

 

governmental agency other than a state insurance department
or is released by the insurer to the news media, no portion
of the memorandum shall be confidential. The memorandum or
other material may otherwise be released by the
commissioner:

 

26-6-301.  Valuation of bonds and other debt
securities.

 

(a)  The commissioner may, by rule or regulation,
require that any bond or other evidence of debt held by an
insurer be valued in accordance with the most recent
published valuation standards of the National Association
of Insurance Commissioners.  Any bonds or other evidences
of debt as to which the National Association of Insurance
Commissioners has not published valuation standards in its
valuations of securities manual, if amply secured and not
in default as to principal or interest, shall be valued as
follows:

 

(iii)  Purchase price shall in no case be taken
at a higher figure than the actual market fair value at the
time of acquisition regardless of how acquired, plus actual
brokerage, transfer, postage or express charges paid in the
acquisition of the securities;

 

26-6-302.  Valuation of other securities.

 

(a)  The commissioner may, by rule or regulation,
require that securities other than securities referred to
in W.S. 26-6-301 and except as provided in W.S.
26-16-502(a)(iv), held by an insurer, be valued in
accordance with the most recent published valuation
standards of the National Association of Insurance

 

Page  7

 

 

 

Commissioners. At the commissioner's discretion, securities
as to which the National Association of Insurance
Commissioners has not published valuation standards shall
be valued at their market fair value, or at their appraised
value or at prices the commissioner determines as
representing their fair market value.

 

(b)  Preferred or guaranteed stocks or shares while
paying full dividends may be carried at a fixed value
instead of market fair value at the commissioner's
discretion and in accordance with a method of computation
he approves.

 

26-6-303.  Valuation of real and personal property.

 

(a)  All real property shall be valued at the lesser
of: as set forth in the most recent National Association of
Insurance Commissioners' accounting practices and
procedures manual.

 

26-6-304.  Valuation of purchase money mortgages.

 

Purchase money mortgages on real property referred to in
W.S. 26-6-303(a) shall be valued in an amount not exceeding
the acquisition cost of the real property covered thereby
or ninety percent (90%) of the fair value of the real
property, whichever is less accordance with the most recent
National Association of Insurance Commissioners' accounting
practices and procedures manual.

 

26-7-110.  Miscellaneous loans and investments.

 

(a)           An insurer may make loans or investments not
otherwise expressly permitted under this chapter, in
aggregate amounts not over five percent (5%) of the
insurer's assets and not over one percent (1%) of those
assets as to any one loan or investment, if the loan or
investment fulfills the requirements of W.S. 26-7-103 and

 

Page  8

 

 

 

otherwise qualifies as a sound investment. No such loan or
investment shall be represented by:

 

(i)  Any item described in excluded under W.S.
26-6-102 or any loan or investment otherwise expressly
prohibited;

 

26-23-102.  Adjuster's reports of overinsurance and
causes of fire; reports deemed privileged communications.

 

(c)  Any report submitted to the commissioner under
this section, together with any accompanying information,
document, record or statement, is an absolutely privileged
communication.  The report may be disclosed as authorized
by and in accordance with the provisions of W.S.
26-2-113(d).

 

26-23-309.  Reinsurance reserve.

 

(f)  A title insurer shall release from the
reinsurance reserve a sum equal to ten percent (10%) of the
amount added to the reserve during a calendar year on July
1 of each of the five (5) years following the year in which
the sum is added, and shall release from the reinsurance
reserve a sum equal to three and one-third percent (3 1/3%)
of the amount added to the reserve during that year on each
succeeding July 1 until the entire amount for that year is
released the appropriate amount as set forth in the most
recent National Association of Insurance Commissioners'
accounting practices and procedures manual. The amount of
the reinsurance reserve or similar unearned premium reserve
maintained before May 27, 1983 July 1, 2001, shall be
released in accordance with the law in effect at the time
such reserves became effective.

 

Page  9

 

 

 

26-26-120.  Annual statement; required; preparation;
filing; fee.

 

(a)  The president and secretary of the insurer shall
prepare, affirm under oath, affix the corporate seal
thereto and on or before March 1 each year file with the
commissioner, on forms the commissioner prescribes, an
annual statement for the immediately preceding calendar
year and showing the condition of the insurer as of
December 31 of that year. The forms shall be completed
pursuant to the most recent National Association of
Insurance Commissioners' accounting practices and
procedures manual.

 

26-27-117.  Determining financial condition of
reciprocal insurer.

 

(a)  In determining the financial condition of a
reciprocal insurer the commissioner shall apply the
following rules: set forth in the most recent National
Association of Insurance Commissioners' accounting
practices and procedures manual.

 

26-29-226.  Reports.

 

(a)  Every society transacting business in this state
shall annually, on or before March 1, unless for cause
shown the time has been extended by the commissioner, file
with the commissioner a true statement of its financial
condition, transactions and affairs for the preceding
calendar year and pay a two hundred fifty dollar ($250.00)
filing fee. The statement shall be in general form and
context as approved by the National Association of
Insurance Commissioners for fraternal benefit societies and
as supplemented by additional information required by the
commissioner. The statement shall be completed pursuant to

 

Page 10

 

 

 

the most recent National Association of Insurance
Commissioners' accounting practices and procedures manual.

 

26-34-110.  Annual report.

 

(a)  Each health maintenance organization, annually,
on or before March 1, shall file with the commissioner,
with a copy to the administrator, a report verified by at
least two (2) organization principal officers and covering
the immediately preceding calendar year. Each health
maintenance organization shall file with the commissioner
on a quarterly basis a statement of its financial condition
for the preceding quarter. Each quarterly statement shall
be filed with the commissioner on or before forty-five (45)
days from the end of the quarter being reported. The
reports and statements shall be on forms the commissioner
prescribes and shall be completed pursuant to the most
recent National Association of Insurance Commissioners'
accounting practices and procedures manual.

 

(b)  The health maintenance organization shall file on
or before March 1, unless otherwise stated:

 

(i)  Audited financial statements in accordance
with the provisions of W.S. 26-3-301 through 26-3-314 on or
before June 1;

 

26-34-130.  Confidentiality of medical information.

 

(d)  The information considered by a health care
review committee and the records of its actions and
proceedings shall be confidential and not subject to
subpoena or order to produce except in proceedings before
the appropriate state licensing or certifying agency, or in
an appeal, if permitted, from the committee's findings or
recommendations. The information shall not be shared

 

Page 11

 

 

 

pursuant to W.S. 26-2-113(d). No member of a health care
review committee, or officer, director or other member of a
health maintenance organization or its staff engaged in
assisting such committee, or any person assisting or
furnishing information to such committee may be subpoenaed
to testify in any judicial or quasi-judicial proceeding if
the subpoena is based solely on such activities. 
Information considered by a health care review committee
and the records of its actions and proceedings which are
used pursuant to this subsection by a state licensing or
certifying agency or in an appeal shall be kept
confidential and shall be subject to the same provision
concerning discovery and use in legal actions as are the
original information and records in the possession and
control of a health care review committee.

 

26-44-110.  Confidential treatment.

 

All information, documents and copies of the documents and
information obtained by or disclosed to the commissioner or
any other person in the course of an examination made
pursuant to W.S. 26-44-109 and all information reported
pursuant to W.S. 26-44-104 through 26-44-108 shall be
confidential, shall not be subject to subpoena and shall
not be made public disclosed by the commissioner, the
National Association of Insurance Commissioners, or any
person, except to insurance departments of other states and
except as provided by W.S. 26-2-112(b) authorized by and in
accordance with the provisions of W.S. 26-2-113(d), without
the prior written consent of the insurer to which the
information pertains. The commissioner, after giving the
insurer and its affiliates notice and opportunity to be
heard, may determine that the interest of policyholders,
shareholders or the public will be served by the
publication of the information, in which event he may

 

Page 12

 

 

 

publish all or any part of the information as he deems
appropriate.

 

Section 2.  W.S. 26-3-304(b)(vi)(B), 26-6-101(a)(i)
through (xiv), 26-6-102(a)(ii) through (v), 26-6-303(a)(iv)
and (v) and 26-27-117(a)(i) through (vii) are repealed.

 

Section 3.  This act is effective July 1, 2001.

 

(END)

 

 

 

 

                                     

Speaker of the House                  President of the Senate

 

                                              

                 Governor                     

                                              

                 TIME APPROVED: _________     

                 DATE APPROVED: _________     

 

I hereby certify that this act originated in the Senate.

 

 

Chief Clerk

 

Page 13