Bill Text: NY S06238 | 2011-2012 | General Assembly | Introduced


Bill Title: Enacts the comprehensive motor vehicle insurance rate reform act; amends provisions applicable to automobile insurance rates including establishing a program for consumer information on insurers and establishing an office of public insurance advocate; revives previously expired provisions of law relating to automobile and property/casualty insurance rates.

Status: (Introduced - Dead) 2012-01-17 - REFERRED TO FINANCE [S06238 Detail]

Download: New_York-2011-S06238-Introduced.html
                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         6238
                                   I N  S E N A T E
                                   January 17, 2012
                                      ___________
       Introduced  by  Sen.  PARKER -- read twice and ordered printed, and when
         printed to be committed to the Committee on Finance
       AN ACT to amend the executive law,  the  insurance  law  and  the  state
         finance  law, in relation to enacting the "Comprehensive Motor Vehicle
         Insurance Rate Reform Act"
         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section  1.  Short  title. This act shall be known and may be cited as
    2  the "Comprehensive Motor Vehicle Insurance Rate Reform Act".
    3    S 2.  The executive law is amended by adding a  new  article  44-A  to
    4  read as follows:
    5                                 ARTICLE 44-A
    6                     OFFICE OF PUBLIC INSURANCE ADVOCATE
    7  SECTION 945. OFFICE OF PUBLIC INSURANCE ADVOCATE.
    8          946. INSURANCE CONSUMER ADVOCATE.
    9          947. POWERS AND DUTIES.
   10    S 945. OFFICE OF PUBLIC INSURANCE ADVOCATE. THERE IS HEREBY CREATED IN
   11  THE  EXECUTIVE  DEPARTMENT  AN  INDEPENDENT OFFICE OF INSURANCE CONSUMER
   12  ADVOCATE (HEREINAFTER REFERRED TO AS "OFFICE") TO REPRESENT  THE  INTER-
   13  ESTS OF NONBUSINESS AUTOMOBILE INSURANCE CONSUMERS IN NEW YORK STATE.
   14    S  946. INSURANCE CONSUMER ADVOCATE. 1.  THE GOVERNOR, WITH THE ADVICE
   15  AND CONSENT OF THE SENATE, SHALL APPOINT AN INSURANCE CONSUMER  ADVOCATE
   16  (HEREINAFTER REFERRED TO AS "ADVOCATE") WHO SHALL SERVE AS THE EXECUTIVE
   17  DIRECTOR  OF THE OFFICE OF INSURANCE CONSUMER ADVOCATE AND SHALL RECEIVE
   18  AN ANNUAL SALARY TO BE FIXED BY THE GOVERNOR WITHIN THE AMOUNT AVAILABLE
   19  THEREFOR BY APPROPRIATION.
   20    2. (A) TO BE ELIGIBLE TO SERVE AS ADVOCATE, A PERSON MUST BE  A  RESI-
   21  DENT  OF  NEW  YORK STATE. THE ADVOCATE SHALL BE A PERSON WHO HAS DEMON-
   22  STRATED A STRONG COMMITMENT AND INVOLVEMENT IN EFFORTS TO SAFEGUARD  THE
   23  RIGHTS  OF  THE  PUBLIC  AND  WHO POSSESSES THE KNOWLEDGE AND EXPERIENCE
   24  NECESSARY TO PRACTICE EFFECTIVELY IN INSURANCE PROCEEDINGS.
   25    (B) A PERSON IS NOT ELIGIBLE FOR APPOINTMENT AS ADVOCATE IF THE PERSON
   26  OR THE PERSON'S SPOUSE:
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD06464-03-2
       S. 6238                             2
    1    (I) IS EMPLOYED BY OR PARTICIPATES IN THE  MANAGEMENT  OF  A  BUSINESS
    2  ENTITY  OR  OTHER  ORGANIZATION REGULATED BY THE INSURANCE DEPARTMENT OR
    3  RECEIVING FUNDS FROM THE DEPARTMENT;
    4    (II)  OWNS  OR CONTROLS, DIRECTLY OR INDIRECTLY, MORE THAN TEN PERCENT
    5  INTEREST IN A BUSINESS ENTITY OR OTHER  ORGANIZATION  REGULATED  BY  THE
    6  INSURANCE DEPARTMENT OR RECEIVING FUNDS FROM THE INSURANCE DEPARTMENT OR
    7  THE OFFICE;
    8    (III)  USES  OR  RECEIVES  A  SUBSTANTIAL  AMOUNT  OF  TANGIBLE GOODS,
    9  SERVICES, OR FUNDS FROM THE INSURANCE DEPARTMENT OR  THE  OFFICE,  OTHER
   10  THAN  COMPENSATION  OR REIMBURSEMENT AUTHORIZED BY LAW FOR THE INSURANCE
   11  DEPARTMENT OR OFFICE MEMBERSHIP, ATTENDANCE OR EXPENSES.
   12    3. THE ADVOCATE SHALL SERVE FOR A TERM OF TWO YEARS EXPIRING ON FEBRU-
   13  ARY FIRST OF EACH ODD-NUMBERED YEAR.
   14    4. IT IS A GROUND FOR REMOVAL FROM OFFICE IF THE ADVOCATE:
   15    (A) DOES NOT HAVE  AT  THE  TIME  OF  APPOINTMENT  THE  QUALIFICATIONS
   16  REQUIRED BY THIS SECTION;
   17    (B)  DOES  NOT  MAINTAIN DURING SERVICE AS ADVOCATE THE QUALIFICATIONS
   18  REQUIRED BY THIS SECTION;
   19    (C) VIOLATES A PROHIBITION ESTABLISHED BY THIS SECTION; OR
   20    (D) CANNOT DISCHARGE THE ADVOCATE'S DUTIES FOR A SUBSTANTIAL  PART  OF
   21  THE TERM FOR WHICH THE ADVOCATE IS APPOINTED BECAUSE OF ILLNESS OR DISA-
   22  BILITY.
   23    5. THE VALIDITY OF AN ACTION OF THE OFFICE IS NOT AFFECTED BY THE FACT
   24  THAT IT IS TAKEN WHEN A GROUND FOR REMOVAL OF THE ADVOCATE EXISTS.
   25    6.  (A)  A  PERSON MAY NOT SERVE AS THE ADVOCATE OR ACT AS THE GENERAL
   26  COUNSEL FOR THE OFFICE OF ADVOCATE IF THE PERSON IS REQUIRED TO REGISTER
   27  AS A LOBBYIST PURSUANT TO ARTICLE ONE-A OF THE LEGISLATIVE LAW.
   28    (B) A PERSON SERVING AS THE ADVOCATE MAY NOT,  FOR  A  PERIOD  OF  TWO
   29  YEARS  AFTER THE DATE THE PERSON CEASES TO BE AN ADVOCATE, REPRESENT ANY
   30  PERSON IN A PROCEEDING BEFORE THE SUPERINTENDENT  OF  INSURANCE  OR  THE
   31  INSURANCE  DEPARTMENT  OR  RECEIVE COMPENSATION FOR SERVICES RENDERED ON
   32  BEHALF OF ANY PERSON REGARDING  A  CASE  BEFORE  THE  SUPERINTENDENT  OF
   33  INSURANCE OR THE INSURANCE DEPARTMENT.
   34    (C)  AN OFFICER, EMPLOYEE OR PAID CONSULTANT OF A TRADE ASSOCIATION IN
   35  THE FIELD OF INSURANCE MAY NOT SERVE AS THE ADVOCATE OR BE  AN  EMPLOYEE
   36  OF THE OFFICE.
   37    (D)  A  PERSON  WHO  IS  THE  SPOUSE  OF  AN OFFICER, MANAGER, OR PAID
   38  CONSULTANT OF A TRADE ASSOCIATION IN THE  FIELD  OF  INSURANCE  MAY  NOT
   39  SERVE AS THE ADVOCATE AND MAY NOT BE AN OFFICE EMPLOYEE.
   40    (E) FOR THE PURPOSES OF THIS SECTION, A TRADE ASSOCIATION IS A NONPRO-
   41  FIT,  COOPERATIVE,  AND  VOLUNTARILY  JOINED  ASSOCIATION OF BUSINESS OR
   42  PROFESSIONAL COMPETITORS DESIGNED TO ASSIST ITS MEMBERS AND ITS INDUSTRY
   43  OR PROFESSION IN DEALING WITH MUTUAL BUSINESS OR  PROFESSIONAL  PROBLEMS
   44  AND IN PROMOTING THEIR COMMON INTEREST.
   45    S  947.  POWERS  AND DUTIES. 1. THE ADVOCATE, AS EXECUTIVE DIRECTOR OF
   46  THE OFFICE, SHALL BE CHARGED WITH THE RESPONSIBILITY  OF  ADMINISTERING,
   47  ENFORCING  AND  CARRYING  OUT  THE PROVISIONS OF THIS ARTICLE, INCLUDING
   48  PREPARATION OF A BUDGET FOR THE OFFICE, EMPLOYING ALL NECESSARY  PROFES-
   49  SIONAL,  TECHNICAL,  AND OTHER EMPLOYEES TO CARRY OUT PROVISIONS OF THIS
   50  ARTICLE, APPROVAL OF EXPENDITURES FOR PROFESSIONAL SERVICES, TRAVEL, PER
   51  DIEM, AND OTHER ACTUAL AND NECESSARY EXPENSES INCURRED IN  ADMINISTERING
   52  THE  OFFICE.  EXPENSES  FOR THE OFFICE SHALL BE PAID FROM THE ASSESSMENT
   53  IMPOSED IN SECTION NINE THOUSAND ONE HUNDRED TEN OF THE  INSURANCE  LAW.
   54  THE  COMPENSATION OF EMPLOYEES OF THE OFFICE SHALL BE FIXED BY THE ADVO-
   55  CATE WITHIN THE APPROPRIATION PROVIDED THEREFOR.
       S. 6238                             3
    1    2. THE OFFICE SHALL FILE ANNUALLY WITH THE GOVERNOR AND THE  PRESIDING
    2  OFFICER OF EACH HOUSE OF THE LEGISLATURE A COMPLETE AND DETAILED WRITTEN
    3  REPORT  ACCOUNTING  FOR  ALL  FUNDS RECEIVED AND DISBURSED BY THE OFFICE
    4  DURING THE PRECEDING FISCAL YEAR. THE ANNUAL REPORT MUST BE IN THE  FORM
    5  AND REPORTED AS PART OF THE EXECUTIVE BUDGET.
    6    3.  ALL MONEY PAID TO THE OFFICE UNDER THIS ARTICLE SHALL BE DEPOSITED
    7  IN THE STATE TREASURY.
    8    4. THE OFFICE MAY ASSESS THE IMPACT OF  INSURANCE  RATES,  RULES,  AND
    9  REGULATIONS  ON  NONBUSINESS  AUTOMOBILE INSURANCE CONSUMERS IN NEW YORK
   10  STATE AND, IN ITS OWN NAME, MAY ADVOCATE ON BEHALF OF POSITIONS THAT ARE
   11  MOST ADVANTAGEOUS TO A SUBSTANTIAL  NUMBER  OF  INSURANCE  CONSUMERS  AS
   12  DETERMINED BY THE ADVOCATE.
   13    5. THE ADVOCATE:
   14    (A)  MAY  APPEAR  OR  INTERVENE AS A MATTER OF RIGHT BEFORE THE SUPER-
   15  INTENDENT OF INSURANCE OR INSURANCE DEPARTMENT AS A PARTY  OR  OTHERWISE
   16  ON  BEHALF OF INSURANCE CONSUMERS AS A CLASS IN MATTERS INVOLVING RATES,
   17  RULES, AND REGULATIONS AFFECTING NONBUSINESS AUTOMOBILE INSURANCE;
   18    (B) MAY INITIATE OR INTERVENE AS A MATTER OF RIGHT OR OTHERWISE APPEAR
   19  IN ANY JUDICIAL PROCEEDING INVOLVING OR ARISING OUT OF ANY ACTION  TAKEN
   20  BY AN ADMINISTRATIVE AGENCY IN A PROCEEDING IN WHICH THE ADVOCATE PREVI-
   21  OUSLY APPEARED UNDER THE AUTHORITY GRANTED BY THIS ARTICLE;
   22    (C)  IS  ENTITLED  TO  ACCESS  ANY  RECORDS OF THE DEPARTMENT THAT ARE
   23  AVAILABLE TO ANY PARTY IN A  PROCEEDING  BEFORE  THE  SUPERINTENDENT  OF
   24  INSURANCE  OR  INSURANCE  DEPARTMENT UNDER THE AUTHORITY GRANTED BY THIS
   25  ARTICLE;
   26    (D) IS ENTITLED TO OBTAIN DISCOVERY OF ANY NON-PRIVILEGED MATTER  THAT
   27  IS RELEVANT TO THE SUBJECT MATTER INVOLVED IN A PROCEEDING OR SUBMISSION
   28  BEFORE  THE  SUPERINTENDENT  OF  INSURANCE  OR  INSURANCE  DEPARTMENT AS
   29  AUTHORIZED BY THIS ARTICLE;
   30    (E) MAY RECOMMEND LEGISLATION TO THE LEGISLATURE THAT, IN THE JUDGMENT
   31  OF THE ADVOCATE, WOULD AFFECT POSITIVELY THE  INTERESTS  OF  NONBUSINESS
   32  AUTOMOBILE INSURANCE CONSUMERS;
   33    (F)  MAY APPEAR OR INTERVENE AS A MATTER OF RIGHT AS A PARTY OR OTHER-
   34  WISE ON BEHALF OF NONBUSINESS AUTOMOBILE INSURANCE CONSUMERS AS A  CLASS
   35  IN  ALL PROCEEDINGS IN WHICH THE ADVOCATE DETERMINES THAT SUCH CONSUMERS
   36  NEED REPRESENTATION, EXCEPT THAT THE ADVOCATE MAY NOT INTERVENE  IN  ANY
   37  ENFORCEMENT  OR PARENS PATRIAE PROCEEDING BROUGHT BY THE ATTORNEY GENER-
   38  AL.
   39    6. (A)  THE  OFFICE  SHALL  PREPARE  INFORMATION  OF  PUBLIC  INTEREST
   40  DESCRIBING THE FUNCTIONS OF THE OFFICE. THE OFFICE SHALL MAKE THE INFOR-
   41  MATION  AVAILABLE  TO  THE PUBLIC, LAWMAKERS AND APPROPRIATE STATE AGEN-
   42  CIES.
   43    (B) THE  OFFICE  SHALL  PREPARE  AND  MAINTAIN  A  WRITTEN  PLAN  THAT
   44  DESCRIBES  HOW  EACH  PERSON  WHO DOES NOT SPEAK ENGLISH CAN BE PROVIDED
   45  REASONABLE ACCESS TO THE OFFICE'S PROGRAMS.
   46    (C) THE OFFICE SHALL PREPARE AND DISTRIBUTE PUBLIC EDUCATION MATERIALS
   47  FOR CONSUMERS, LEGISLATORS AND REGULATORS.
   48    (D) THE OFFICE MAY PARTICIPATE IN TRADE ASSOCIATIONS.
   49    S 3. Subsection (d) of section 2321 of the insurance law is amended to
   50  read as follows:
   51    (d) Proceedings pursuant to subsections (b) and (c) [hereof]  OF  THIS
   52  SECTION  may  be instituted upon the initiative of the superintendent or
   53  upon written application to the superintendent by any  aggrieved  person
   54  or  organization, other than a rate service organization, for a hearing,
   55  if the superintendent finds that the application is made in  good  faith
   56  and  that  the  grounds  otherwise  justify holding such a hearing WHICH
       S. 6238                             4
    1  SHALL BE HELD WITHIN FIFTEEN DAYS OF  THE  REQUEST;  PROVIDED,  HOWEVER,
    2  THAT THE SUPERINTENDENT SHALL HOLD SUCH A HEARING WITHIN FIFTEEN DAYS OF
    3  AN APPLICATION THEREFOR FROM THE INSURANCE CONSUMER ADVOCATE ESTABLISHED
    4  UNDER ARTICLE FORTY-FOUR-A OF THE EXECUTIVE LAW. IN THE CASE OF A DENIAL
    5  OF  AN  APPLICATION  FOR  A HEARING FILED BY ANY AGGRIEVED PERSON OR ANY
    6  OTHER ORGANIZATION, THE SUPERINTENDENT SHALL PROVIDE THE REASONS  THERE-
    7  FOR IN WRITING TO THE APPLICANT WITHIN FIFTEEN DAYS OF SUCH DENIAL.
    8    S 4. Subsection (c) of section 2305 of the insurance law is amended to
    9  read as follows:
   10    (c)  Rates  filed  with the superintendent shall be accompanied by the
   11  information upon which the insurer supports the rate  as  set  forth  in
   12  subsection  (b) of section two thousand three hundred four of this arti-
   13  cle.  WITH RESPECT TO RATES FILED FOR NONBUSINESS  AUTOMOBILE  POLICIES,
   14  SUCH  FILINGS  SHALL INCLUDE ALL STATISTICAL DATA RELIED UPON TO SUPPORT
   15  THE FILING AND  SUCH  OTHER  INFORMATION  AS  THE  SUPERINTENDENT  SHALL
   16  REQUIRE.  SUCH  FILINGS  AND  SUPPORTING  INFORMATION SHALL CONFORM WITH
   17  STANDARDS OF UNIFORMITY WHICH  THE  SUPERINTENDENT  SHALL  PRESCRIBE  BY
   18  REGULATION  ON OR BEFORE THE JANUARY IMMEDIATELY FOLLOWING THE EFFECTIVE
   19  DATE OF THE CHAPTER OF THE LAWS OF TWO THOUSAND TWELVE THAT AMENDED THIS
   20  SUBSECTION.
   21    S 5. Section 89-d of the state finance law, as amended by chapter  170
   22  of  the laws of 1994 and subdivision 2 as amended by section 4 of part T
   23  of chapter 56 of the laws of 2009, is amended to read as follows:
   24    S 89-d. Motor vehicle theft and insurance fraud  prevention  fund.  1.
   25  There is hereby established in the custody of the comptroller, a special
   26  fund  to  be  known  as  the  "motor  vehicle  theft and insurance fraud
   27  prevention fund".
   28    2. Such fund shall consist of all moneys received by the state  pursu-
   29  ant  to  subsection  (b) of section nine thousand one hundred ten of the
   30  insurance law that are transferred to the fund pursuant to paragraph one
   31  of subsection (e) of section nine thousand one hundred ten of the insur-
   32  ance law and all other grants, bequests or  other  moneys  appropriated,
   33  credited  or  transferred thereto from any other fund or source pursuant
   34  to law.
   35    3. Moneys in the motor vehicle theft and  insurance  fraud  prevention
   36  fund  shall  be kept separate and apart and shall not be commingled with
   37  any other moneys in the custody of the comptroller  and  shall  only  be
   38  expended  herein  and in such amounts as approved by the division of the
   39  budget.
   40    4. [The] EXCEPT AS PROVIDED IN THIS SUBDIVISION, THE  moneys  received
   41  by  such  fund  shall be expended pursuant to appropriation only to fund
   42  provider agencies which have been awarded grants by  the  motor  vehicle
   43  theft  and  insurance  fraud  prevention  board  established pursuant to
   44  section eight hundred forty-six-l  of  the  executive  law.  All  moneys
   45  expended  pursuant to this subdivision shall be for the reimbursement of
   46  costs incurred by provider agencies; PROVIDED, HOWEVER THAT NO LESS THAN
   47  ONE MILLION TWO HUNDRED THOUSAND DOLLARS SHALL BE USED FOR THE  PURPOSES
   48  OF CREATING, ADMINISTERING AND OPERATING THE OFFICE OF INSURANCE CONSUM-
   49  ER  ADVOCATE  CREATED  PURSUANT TO ARTICLE FORTY-FOUR-A OF THE EXECUTIVE
   50  LAW.
   51    S 6. Section 2329 of the insurance law, as amended by chapter  102  of
   52  the laws of 2011, is amended to read as follows:
   53    S 2329. Motor vehicle insurance rates; excess profits.  (A) In accord-
   54  ance  with  regulations  prescribed  by the superintendent, each insurer
   55  issuing policies which are subject to article fifty-one of this chapter,
   56  including policies of motor vehicle personal injury liability  insurance
       S. 6238                             5
    1  or  policies  of  motor  vehicle  property damage liability insurance or
    2  insurance for loss or damage to a motor vehicle, shall establish a fair,
    3  practicable, and nondiscriminatory plan for refunding or otherwise cred-
    4  iting  to  those  purchasing  such policies their share of the insurer's
    5  excess profit, if any, on such policies. An excess  profit  shall  be  a
    6  profit  beyond  a percentage rate of return on net worth attributable to
    7  such policies, computed in accordance with the  regulation  required  by
    8  section  two  thousand  three  hundred twenty-three of this article, and
    9  determined by the superintendent to be so far above a reasonable average
   10  profit as to amount to an excess profit, taking into  consideration  the
   11  fact  that  losses or profits below a reasonable average profit will not
   12  be recouped from such policyholders. Each plan  shall  apply  to  policy
   13  periods  for  the  periods  January first, nineteen hundred seventy-four
   14  through August second, two thousand one, and the effective date  of  the
   15  property/casualty insurance availability act through June thirtieth, two
   16  thousand  fourteen.  In  prescribing such regulations the superintendent
   17  may limit the duration of such plans, waive any requirement  for  refund
   18  or  credit which he or she determines to be de minimis or impracticable,
   19  adopt forms of returns which shall be made to him or  her  in  order  to
   20  establish  the amount of any refund or credit due, establish periods and
   21  times for the determination and distribution of refunds and credits, and
   22  shall provide that  insurers  receive  appropriate  credit  against  any
   23  refunds  or credits required by any such plan for policyholder dividends
   24  and for return premiums which may be due under rate credit or retrospec-
   25  tive rating plans based on experience.
   26    (B)(1) ON OR BEFORE NOVEMBER FIRST, TWO THOUSAND THIRTEEN, AND ANNUAL-
   27  LY THEREAFTER, THE SUPERINTENDENT SHALL COMPLETE A RECALCULATION OF  THE
   28  POINTS  FOR  REASONABLE  RATE  OF  RETURN AND EXCESS PROFITS ESTABLISHED
   29  UNDER THE REGULATIONS PROMULGATED PURSUANT TO THIS  SECTION,  USING  THE
   30  MOST  RECENT SIX YEAR PERIOD FOR WHICH DATA IS AVAILABLE. IF SUCH RECAL-
   31  CULATION RESULTS IN A CHANGE IN SUCH POINTS,  THE  SUPERINTENDENT  SHALL
   32  IMMEDIATELY  ADOPT SUCH POINTS IN REGULATION, AND, IF, UNDER SUCH RECAL-
   33  CULATION, EXCESS PROFITS HAVE BEEN REALIZED, SHALL IMMEDIATELY  ACTIVATE
   34  PLANS  FOR  REFUNDING  OR  OTHERWISE  CREDITING TO THOSE PURCHASING SUCH
   35  POLICIES THEIR SHARE OF INSURERS' EXCESS PROFIT, IN ACCORDANCE WITH  THE
   36  REGULATIONS PROMULGATED HEREUNDER.
   37    (2)  ON  OR BEFORE DECEMBER FIRST, TWO THOUSAND THIRTEEN, AND ANNUALLY
   38  THEREAFTER, THE SUPERINTENDENT  SHALL  HOLD  A  PUBLIC  HEARING  ON  THE
   39  RESULTS  OF  SUCH  RECALCULATION  AND ANY ACTIONS INSTITUTED PURSUANT TO
   40  THIS SECTION AS A RESULT OF SUCH RECALCULATION.  ON  OR  BEFORE  JANUARY
   41  FIRST,  TWO  THOUSAND FOURTEEN, AND ANNUALLY THEREAFTER, THE SUPERINTEN-
   42  DENT SHALL SEND A TRANSCRIPT OF THE HEARING TO  THE  LEGISLATURE  AND  A
   43  REPORT  ON  THE RESULTS OF SUCH RECALCULATION AND ANY ACTIONS INSTITUTED
   44  AS REQUIRED BY THIS SECTION.
   45    (3) ON OR BEFORE OCTOBER FIRST, TWO THOUSAND THIRTEEN, THE SUPERINTEN-
   46  DENT SHALL ISSUE A REQUEST FOR PROPOSALS TO CONDUCT AN INDEPENDENT AUDIT
   47  AND EVALUATION, WITH RESPECT TO  NONBUSINESS  AUTOMOBILE  INSURANCE,  OF
   48  INSURER  COMPLIANCE  WITH  AND  THE  SUPERINTENDENT'S IMPLEMENTATION AND
   49  ENFORCEMENT OF THE PROVISIONS OF THIS SECTION.  THE SUPERINTENDENT SHALL
   50  PROVIDE THE CHAIRS OF THE ASSEMBLY AND SENATE  COMMITTEES  ON  INSURANCE
   51  WITH  THE RESPONSES TO THE REQUEST FOR PROPOSALS, AND SHALL CONSULT WITH
   52  SUCH CHAIRS ON THE SELECTION OF THE FIRM TO CONDUCT THE AUDIT.
   53    SUCH AUDIT SHALL BE COMPLETED  AND  A  REPORT  SUBMITTED  BY  NOVEMBER
   54  FIRST,  TWO THOUSAND FOURTEEN TO THE SUPERINTENDENT AND THE LEGISLATURE.
   55  THE SCOPE OF THE AUDIT SHALL INCLUDE, BUT NOT BE LIMITED TO:
       S. 6238                             6
    1    (I) AN IDENTIFICATION AND EVALUATION OF EVENTS AND  CONDITIONS  INFLU-
    2  ENCING  INSURER  PROFITS,  INCLUDING,  BUT  NOT LIMITED TO: THE BUSINESS
    3  CLIMATE AND CHANGES IN ECONOMIC CONDITIONS, INCLUDING INTEREST RATES;
    4    (II)  AN  ASSESSMENT  OF  THE  APPROPRIATENESS  OF THE METHODOLOGY FOR
    5  SELECTING A REASONABLE RATE OF RETURN AND EXCESS PROFIT THRESHOLD  UNDER
    6  SUCH REGULATION;
    7    (III)  AN  ASSESSMENT  OF  THE FEASIBILITY OF USING INDIVIDUAL INSURER
    8  RESULTS RATHER THAN AGGREGATE INDUSTRY DATA FOR TESTING PROFITABILITY;
    9    (IV) AN ASSESSMENT OF THE FEASIBILITY OF AVERAGING DATA OVER LESS THAN
   10  A SIX YEAR PERIOD FOR MEASURING EXCESS PROFITS;
   11    (V) AN ASSESSMENT OF  THE  DEPARTMENT'S  ACTIVITIES  WITH  RESPECT  TO
   12  RECALCULATING  THE  POINTS  FOR  REASONABLE  RATE  OF  RETURN AND EXCESS
   13  PROFITS;
   14    (VI) A RECALCULATION OF THE POINTS FOR REASONABLE RATE OF  RETURN  AND
   15  EXCESS  PROFITS  USING THE MOST RECENT SIX YEAR PERIOD FOR WHICH DATA IS
   16  AVAILABLE; AND
   17    (VII) AN IDENTIFICATION AND EVALUATION OF OTHER STATES' EXCESS PROFITS
   18  LAWS, REGULATIONS, IMPLEMENTATION OF  SUCH  LAWS  AND  REGULATIONS,  AND
   19  METHODOLOGIES FOR CALCULATING POINTS FOR REASONABLE RATE OF RETURN.
   20    THE  REPORT SHALL INCLUDE, BUT NOT BE LIMITED TO:  RECOMMENDATIONS FOR
   21  CHANGES TO THE LAW, REGULATIONS AND IMPLEMENTATION  AND  ENFORCEMENT  OF
   22  SUCH  PROVISIONS  BASED  ON  THE  FINDINGS OF SUCH AUDIT AND EVALUATION.
   23  WITHIN THREE MONTHS OF THE RECEIPT OF SUCH  REPORT,  THE  SUPERINTENDENT
   24  SHALL  HOLD A PUBLIC HEARING WITH REGARD TO THE DEPARTMENT'S RESPONSE TO
   25  THE FINDINGS AND RECOMMENDATIONS OF THE REPORT.
   26    S 7.  This act shall take effect immediately, provided, however,  that
   27  this  act  shall  apply  to  insurance contracts issued or renewed on or
   28  after such effective date, and shall apply at the next  required  policy
   29  period,  commencing  on  or  after  such date, to any insurance contract
   30  written prior to the effective date of this act.
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