Collaborative Actions

PURPOSE: This rule implements the purposes of section 374.185, RSMo, and establishes relevant standards for the director in applying the discretion authorized in issuing warrants for market conduct examinations pursuant to sections 374.202 to 374.207, RSMo, when other states are considering a market conduct examination regarding the same company or have recently issued a market conduct report regarding the same company. (1) To provide uniform standards designed to avoid arbitrary or capricious use of discretion in issuing warrants for market conduct examinations, the director will apply the following standards in evaluating factual support for a warrant when another jurisdiction is considering conducting a market conduct examination or has issued a market conduct report for an examination that has been conducted within the last three (3) years: (A) In lieu of issuing an examination warrant for a market conduct examination, the director may delegate responsibility for conducting an examination of a domestic company, foreign company, or an affiliate of a company to the insurance commissioner of another jurisdiction if that insurance commissioner agrees to accept the delegated responsibility for the examination, and the domestic company, foreign company, or affiliate has a significant number of policies or significant premium volume in that jurisdiction. If the director elects to delegate responsibility for examining a company, the division will accept a report of the examination prepared by the insurance commissioner to whom the responsibility has been delegated; (B) In lieu of requesting an examination warrant by the director and conducting a market conduct examination of a company, the division will accept a report of a market conduct examination on such company prepared by the insurance commissioner of the company’s jurisdiction or state of domicile or another jurisdiction state if the director has determined— 1. The laws of that jurisdiction applicable to the subject of the examination are substantially similar to those of this state; 2. The examining jurisdiction has a market conduct analysis and examination system comparable to the system set forth under Chapter 7 of this division; and 3. The examination from the other jurisdiction’s commissioner has been conducted within the past three (3) years; and (C) Notwithstanding the above provisions, if the insurance commissioner to whom the examination responsibility was delegated, or the report of a market conduct examination prepared by the insurance commissioner of another jurisdiction, did not evaluate the specific area or issue of concern to the director or a specific requirement of Missouri law, the director may issue an examination warrant for a targeted examination to evaluate that specific area or issue of concern. (2) Subject to a determination under this rule, if a market conduct examination conducted by another jurisdiction results in modification of a specific practice or procedure, the director will accept documentation that the company has made a similar modification in this state, in lieu of initiating a market conduct action or examination related to that practice or procedure. In order to protect the interests of consumers, policyholders, and claimants of this state, the director may initiate such other enforcement action as is necessary to assure compliance with the laws and regulations of this state. The director may require other or additional practice or procedure modifications as are necessary to achieve compliance with specific state laws or regulations, which differ substantially from those of the examining jurisdiction. (3) If at any time prior to or during an examination it is brought AND INSURANCE to the attention of the examiner-in-charge that the insurer or other company has modified such practice or procedure as a result of a market conduct action taken by the commissioner of another jurisdiction, the examiner-in-charge will accept documentation that the company has satisfactorily modified the practice or procedure and made similar modification to such practice or procedure in this state. In order to protect the interests of consumers, policyholders, and claimants of this state, the director may initiate such other enforcement action as is necessary to assure compliance with the laws and regulations of this state. (4) If the insurer or other company to be examined is not a domestic company, the director, upon issuance of an examination warrant, will communicate with and may coordinate the examination with the insurance commissioner of the jurisdiction or state in which the company is domiciled. AUTHORITY: sections 374.045, 374.185, 374.205, and 374.207, RSMo 2016.* Original rule filed April 1, 2008, effective Nov. 30, 2008. Amended: Filed Dec. 13, 2018, effective July 30, 2019. *Original authority: 374.045, RSMo 1967, amended 1993, 1995, 2008; 374.185, RSMo 2007, amended 2016; 374.205, RSMo 1992, amended 1997, 1999, 2016; and 374.207, RSMo 1992.