Appropriation: The provision of funds, through an annual appropriations act or a permanent law, for federal agencies to make payments out of the Treasury for specified purposes. The formal federal spending process consists of two sequential steps: authorization
Domestic insurer: means an insurer organized under the laws of this state. See Utah Code 31A-1-301
Insurance: includes :
(i)
a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;
(ii)
a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and
(iii)
a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301
producer: means a person licensed or required to be licensed under the laws of this state to sell, solicit, or negotiate insurance. See Utah Code 31A-1-301
Rate: means :
(i)
the cost of a given unit of insurance; or
(ii)
for property or casualty insurance, that cost of insurance per exposure unit either expressed as:
(A)
a single number; or
(B)
a pure premium rate, adjusted before the application of individual risk variations based on loss or expense considerations to account for the treatment of:
Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
Surplus: means the excess of assets over the sum of paid-in capital and liabilities. See Utah Code 31A-1-301
(a)
Except as provided in Subsection (3), an examinee that is one of the following shall reimburse the department for the reasonable costs of examinations made under Sections 31A-2-203 and 31A-2-204:
(i)
an insurer;
(ii)
a rate service organization;
(iii)
a subsidiary of an insurer or rate service organization; or
(iv)
a life settlement provider.
(b)
The following costs shall be reimbursed under this Subsection (1):
(i)
actual travel expenses;
(ii)
reasonable living expense allowance;
(iii)
compensation at reasonable rates for all professionals reasonably employed for the examination under Subsection (4);
(iv)
the administration and supervisory expense of:
(A)
the department; and
(B)
the attorney general’s office; and
(v)
an amount necessary to cover fringe benefits authorized by the commissioner or provided by law.
(c)
In determining rates, the commissioner shall consider the rates recommended and outlined in the examination manual sponsored by the National Association of Insurance Commissioners.
(d)
This Subsection (1) applies to a surplus lines producer to the extent that the examinations are of the surplus line producer’s surplus lines business.
(2)
An insurer requesting the examination of one of its producers shall pay the cost of the examination. Otherwise, the department shall pay the cost of examining a licensee other than those specified under Subsection (1).
(3)
(a)
On the examinee’s request or at the commissioner’s discretion, the department may pay all or part of the costs of an examination whenever the commissioner finds that because of the frequency of examinations or the financial condition of the examinee, imposition of the costs would place an unreasonable burden on the examinee.
(b)
The commissioner shall include in the commissioner’s annual report information about any instance in which the commissioner has applied this Subsection (3).
(4)
(a)
A technical expert employed under Subsection 31A-2-203(3) shall present to the commissioner a statement of all expenses incurred by the technical expert in conjunction with an examination.
(b)
The examined insurer shall, at the commissioner’s direction, pay to a technical expert:
(i)
(A)
actual travel expenses;
(B)
reasonable living expenses; and
(C)
compensation; and
(ii)
for expenses necessarily incurred as approved by the commissioner.
(c)
The examined insurer shall reimburse the department for:
(i)
a department examiner’s:
(A)
actual travel expenses; and
(B)
reasonable living expenses; and
(ii)
the compensation of department examiners involved in the examination.
(d)
(i)
The examined insurer shall certify the consolidated account of all charges and expenses for the examination.
(ii)
The examined insurer shall:
(A)
retain a copy of the consolidated account; and
(B)
file a copy of the consolidated account with the department as a public record.
(e)
An annual report of examination charges paid by examined insurers directly to persons employed under Subsection 31A-2-203(3) or to department examiners shall be included with the department’s budget request.
(f)
Amounts paid directly by examined insurers to persons employed under Subsection 31A-2-203(3) or to department examiners may not be deducted from the department’s appropriation.
(5)
(a)
The amount payable under Subsection (1) is due 10 days after the day on which the examinee is served with a detailed account of the costs.
(b)
Payments received by the department under this Subsection (5) shall be handled as provided by Section 31A-3-101.
(6)
(a)
The commissioner may require an examinee under Subsection (1), or an insurer requesting an examination under Subsection (2), either before or during an examination, to make deposits with the state treasurer to pay the costs of examination.
(b)
Any deposit made under this Subsection (6) shall be held in trust by the state treasurer until applied to pay the department the costs payable under this section.
(c)
If a deposit made under this Subsection (6) exceeds examination costs, the state treasurer shall refund the surplus.
(7)
A domestic insurer may offset the examination expenses paid under this section against premium taxes under Subsection 59-9-102(2).
