(a)Power of Commissioner. Subject to the limitation contained in this section, and in addition to the powers that the commissioner has under chapters 1 and 32 of this title, relating to the examination of insurers or health maintenance organizations, the commissioner also has the power to examine any insurer or health maintenance organization registered under § 56-11-105 and its affiliates to ascertain the financial condition of the insurer or health maintenance organization, including the enterprise risk to the insurer by the ultimate controlling party, or by any entity or combination of entities within the insurance or health maintenance organization holding company system, or by the insurance or health maintenance organization holding company system on a consolidated basis.
Enterprise Risk: means any activity, circumstance, event or series of events involving one (1) or more affiliates of an insurer that, if not remedied promptly, is likely to have a material adverse effect upon the financial condition or liquidity of the insurer or its insurance holding company system as a whole, including, but not limited to, anything that would cause the insurer's Risk-Based Capital to fall into company action level as set forth in §. See Tennessee Code 56-11-101
Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
Health maintenance organization holding company system: means two (2) or more affiliated persons, one (1) of which is a health maintenance organization. See Tennessee Code 56-11-101
Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
Person: means an individual, a corporation, a limited liability company, a partnership, an association, a joint stock company, a trust, an unincorporated organization, any similar entity or any combination of the foregoing acting in concert, but does not include any joint venture partnership exclusively engaged in owning, managing, leasing or developing real or tangible personal property. See Tennessee Code 56-11-101
State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
Subpoena: A command to a witness to appear and give testimony.
Testify: Answer questions in court.
Testimony: Evidence presented orally by witnesses during trials or before grand juries.
(b)Access to Books and Records.(1) The commissioner may order any insurer or health maintenance organization registered under § 56-11-105 to produce any records, books, or other information papers in the possession of the insurer or health maintenance organization or its affiliates that are reasonably necessary to determine compliance with this title.(2) To determine compliance with this title, the commissioner may order any insurer or health maintenance organization registered under § 56-11-105 to produce information not in the possession of the insurer or health maintenance organization if the insurer or health maintenance organization can obtain access to such information pursuant to contractual relationships, statutory obligations, or other methods. In the event the insurer or health maintenance organization cannot obtain the information requested by the commissioner, the insurer or health maintenance organization shall provide the commissioner a detailed explanation of the reason that the insurer or health maintenance organization cannot obtain the information and the identity of the holder of information. Whenever it appears to the commissioner that the detailed explanation is without merit, the commissioner may require, after notice and hearing, the insurer or health maintenance organization to pay a penalty of one hundred dollars ($100) for each day’s delay, or may suspend or revoke the insurer’s license.(c)Use of Consultants. The commissioner may retain, at the registered insurer or health maintenance organization’s expense, attorneys, actuaries, accountants and other experts, not otherwise a part of the commissioner’s staff, that shall be reasonably necessary to assist in the conduct of the examination under subsection (a). Any persons so retained shall be under the direction and control of the commissioner and shall act in a purely advisory capacity.(d)Expenses. Each registered insurer or health maintenance organization producing for examination records, books and papers pursuant to subsection (a) shall be liable for and shall pay the expense of the examination in accordance with chapters 1 and 32 of this title.(e)Compelling Production. In the event the insurer fails to comply with an order, the commissioner shall have the power to examine the affiliates to obtain the information. The commissioner shall also have the power to issue subpoenas, to administer oaths, and to examine under oath any person for purposes of determining compliance with this section. Upon the failure or refusal of any person to obey a subpoena, the commissioner may petition a court of competent jurisdiction, and upon proper showing, the court may enter an order compelling the witness to appear and testify or produce documentary evidence. Failure to obey the court order shall be punishable as contempt of court. Every person shall be obliged to attend as a witness at the place specified in the subpoena, when subpoenaed, anywhere within the state. Such person shall be entitled to the same fees and mileage, if claimed, as a witness in courts of this state, which fees, mileage, and actual expense, if any, necessarily incurred in securing the attendance of witnesses, and their testimony, shall be itemized and charged against, and be paid by, the company being examined.
