760 IAC 1-15.1-3.5 Transactions subject to prior notice; notice filing

Sec. 3.5. (a) An insurer required to give notice of a proposed transaction in accordance with IC 27-1-23-4 shall furnish the required information on Form D. (b) Agreements for cost sharing services and management services must at least, and as applicable, do the following: (1) Identify the person providing services and the nature of the services. (2) Set forth the methods to allocate costs. (3) Require timely settlement, not less frequently than on a quarterly basis, and compliance with the requirements in the Accounting Practices and Procedures Manual. (4) Prohibit advancement of funds by the insurer to the affiliate except to pay for services defined in the agreement. (5) State that the insurer will: (A) maintain oversight for functions provided to the insurer by the affiliate; and (B) monitor services annually for quality assurance. (6) Define records and data of the insurer to include all records and data developed or maintained under, or related to, the agreement that are otherwise the property of the insurer, in whatever form maintained, including, but not limited to, claims and claim files, policyholder lists, application files, litigation files, premium records, rate books, underwriting manuals, personnel records, financial records, or similar records within the possession, custody, or control of the affiliate. (7) Specify that all records and data of the insurer are and remain the property of the insurer and are: (A) subject to control of the insurer; (B) identifiable; and (C) segregated from the records and data of other persons or readily capable of segregation at no additional cost to the insurer. (8) State that all funds and invested assets of the insurer are: (A) the exclusive property of the insurer; (B) held for the benefit of the insurer; and (C) subject to the control of the insurer. (9) Include standards for termination of the agreement with and without cause. (10) Include provisions for indemnification of the insurer in the event of gross negligence or willful misconduct on the part of the affiliate providing the services and for any actions by the affiliate that violate provisions of the agreement required in subdivisions (11) through (15). (11) Specify that if the insurer is placed in supervision, seizure, conservatorship, or receivership, or seized by the commissioner under IC 27-9: (A) the rights of the insurer under the agreement extend to the receiver or commissioner to the extent permitted by IC 27-9; and (B) all records and data: (i) will immediately be made available to the receiver or commissioner; and (ii) are turned over to the receiver or commissioner immediately at the receiver's or commissioner's request; (iii) are made available in a usable format; (iv) are identifiable and segregated from the records and data of other persons or readily capable of segregation at no additional cost to the receiver or commissioner; (v) the affiliated person or persons will make available all employees essential to the operations of the insurer and the services associated with those operations for the immediate continued performance of the essential services ordered or directed by the receiver or commissioner. (12) Specify that the affiliate has no automatic right to terminate the agreement if the insurer is placed into supervision, seizure, conservatorship, or receivership. (13) Specify that the affiliate will provide the essential services for a minimum period after the agreement is terminated, if the insurer is placed into supervision, seizure, conservatorship, or receivership under IC 27-9, as ordered or directed by the receiver or commissioner. Performance of the essential services will continue to be provided without regard to prereceivership unpaid fees, so long as the affiliate continues to receive timely payment for post-receivership services rendered, and unless released by the receiver, commissioner, or supervising court. (14) Specify that the affiliate will: (A) continue to maintain any systems, programs, or other infrastructure, notwithstanding supervision, seizure, conservatorship, or receivership under IC 27-9; and (B) make them available to the receiver or commissioner, as ordered or directed by the receiver or commissioner, so long as the affiliate continues to receive timely payment for post-receivership services rendered, and unless released by the receiver, commissioner, or supervising court. (15) Specify that to further support the cooperation between the receiver and affected guaranty association or associations, and subject to the receiver's authority over the insurer, if the insurer is placed into supervision, seizure, conservatorship, or receivership under IC 27-9, and portions of the insurer's policies or contracts are eligible for coverage by at least one (1) guaranty association, the affiliate's commitments under subdivisions (11) through (14) will extend to the guaranty association or associations.