Administrative Rule Review Report  #AR07-043

Legislative Service Office

15-Aug-07

 

AGENCY:                                 Wyoming Insurance Department.

 

DATE SUBMITTED:                  August 15, 2007.

 

SUBJECT:                                 Chapter 57, Custodial Agreements and the Use of Clearing Corporations; and Chapter 59,  Permitting the Recognition of Preferred Mortality Tables for Use in Determining Minimum Reserve Liabilities.

 

NATURE OF RULES:                     Legislative and procedural

 

STATUTORY AUTHORITY:         W.S. 26-2-110, 26-8-202 and 26-6-205

 

DETERMINATION OF PROCEDURAL COMPLIANCE BASED UPON INFORMATION

SUBMITTED BY THE AGENCY TO LSO:  Apparently complete to date.  Although the agency did not cite the rules as "new rules" in the notice to adopt rules, changes to Chapter 57 were in response to 2007 Senate File 19 – Insurance Department-accreditation."  Notice was transmitted by the Legislative Service Office in compliance with W.S. 28-9-103(d) on July 18, 2007.

 

SUMMARY OF RULES:

 

Chapter 57 regulates custodial agreements and the use of clearing corporations by insurance carriers.  These amendments to Chapter 57 reflect statutory changes which clarified the definition of a clearing corporation to eliminate out-dated references to the federal book entry system and replace the more limiting term "bank" with the more inclusive term "custodian".

 

Under state statute, all companies issuing life insurance policies and contracts in Wyoming must establish reserves to be held in support of the life insurance policies.  Chapter 59 regulates the use of preferred mortality tables in determining those minimum reserve liabilities.  These amendments to Chapter 59 recognize and permit the use of mortality tables that reflect differences in mortality between preferred and standard lives when determining minimum reserve liabilities.  The newly allowed mortality tables were adopted by the National Association of Insurance Commissioners in 2006.

 

FINDINGS:  The rules appear to be within the scope of statutory authority and legislative intent.

 

 

 

 

 

 

 

 

STAFF RECOMMENDATION:   That the rules be placed on the Consent List and be approved by the Council as submitted by the Agency.

 

 

 

                                                            _______________________

                                                            Lynda Cook

                                                            Staff Attorney

 

                                                            _______________________

                                                            David K. Gruver

                                                            Assistant Director

LGC/