S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         3287
                              2015-2016 Regular Sessions
                                   I N  S E N A T E
                                   February 4, 2015
                                      ___________
       Introduced  by  Sen.  SEWARD -- read twice and ordered printed, and when
         printed to be committed to the Committee on Insurance
       AN ACT to amend the insurance  law,  in  relation  to  establishing  the
         interstate  insurance  product  regulation compact to regulate certain
         insurance products
         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section  1. Legislative findings and intent.  An interstate compact is
    2  a contract between the states that allows them to  cooperate  on  multi-
    3  state or national issues while still retaining state control. Interstate
    4  compacts  are  specifically  mentioned in the U.S. Constitution and have
    5  been historically used to address border disputes and water rights.  The
    6  use  of interstate compacts has expanded significantly in recent decades
    7  to cover tax, motor vehicle licensing, environmental, emergency  manage-
    8  ment and other issues. Over 200 interstate compacts currently exist, and
    9  on  average  every state belongs to at least 25 compacts. The Interstate
   10  Insurance Product Regulation Compact, which to date has been adopted  by
   11  44  member  states, representing approximately two-thirds of the premium
   12  volume in the nation, created the  Interstate  Insurance  Product  Regu-
   13  lation  Commission (IIPRC). The IIPRC provides the States with a vehicle
   14  to (1) develop uniform national product standards  that  will  afford  a
   15  high  level  of  protection  to  consumers of life insurance, annuities,
   16  disability income and long-term care insurance products; (2) establish a
   17  central point of filing for these insurance products; and (3) thoroughly
   18  review product filings and make regulatory decisions  according  to  the
   19  uniform  product  standards.  The  IIPRC  is  an important modernization
   20  initiative that benefits state insurance regulators, consumers, and  the
   21  insurance  industry.  The Compact enhances the efficiency and effective-
   22  ness of the way insurance products are  filed,  reviewed,  and  approved
   23  allowing insurance customers to have faster access to competitive insur-
   24  ance  products  in  an  ever-changing  global  marketplace.  The Compact
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD06596-03-5
       S. 3287                             2
    1  promotes uniformity through application  of  uniform  product  standards
    2  embedded  with strong consumer protections.  The state of New York seeks
    3  to join with other states as a member of the Interstate Insurance  Prod-
    4  uct Regulation Compact and Commission.
    5    S  2.  The insurance law is amended by adding a new article 82 to read
    6  as follows:
    7                                 ARTICLE 82
    8               INTERSTATE INSURANCE PRODUCT REGULATION COMPACT
    9  SECTION 8201. SHORT TITLE.
   10          8202. PURPOSE.
   11          8203. DEFINITIONS.
   12          8204. ESTABLISHMENT OF THE COMMISSION AND VENUE.
   13          8205. POWERS OF THE COMMISSION.
   14          8206. ORGANIZATION OF THE COMMISSION.
   15          8207. MEETINGS AND ACTS OF THE COMMISSION.
   16          8208. RULES AND OPERATING PROCEDURES; RULE MAKING  FUNCTIONS  OF
   17                  THE COMMISSION AND OPTING OUT OF UNIFORM STANDARDS.
   18          8209. COMMISSION RECORDS AND ENFORCEMENT.
   19          8210. DISPUTE RESOLUTION.
   20          8211. PRODUCT FILING AND APPROVAL.
   21          8212. REVIEW OF COMMISSION DECISIONS REGARDING FILINGS.
   22          8213. FINANCE.
   23          8214. COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT.
   24          8215. WITHDRAWAL, DEFAULT AND TERMINATION.
   25          8216. SEVERABILITY AND CONSTRUCTION.
   26          8217. BINDING EFFECT OF COMPACT AND OTHER LAWS.
   27    S  8201.  SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
   28  THE "INTERSTATE INSURANCE PRODUCT REGULATION COMPACT".
   29    S 8202. PURPOSE. THE PURPOSES OF THIS COMPACT ARE,  THROUGH  MEANS  OF
   30  JOINT AND COOPERATIVE ACTION AMONG THE COMPACTING STATES:
   31    (A) TO PROMOTE AND PROTECT THE INTEREST OF CONSUMERS OF INDIVIDUAL AND
   32  GROUP  ANNUITY,  LIFE  INSURANCE,  DISABILITY  INCOME AND LONG-TERM CARE
   33  INSURANCE PRODUCTS;
   34    (B) TO DEVELOP  UNIFORM  STANDARDS  FOR  PRODUCTS  COVERED  UNDER  THE
   35  COMPACT;
   36    (C) TO ESTABLISH A CENTRAL CLEARINGHOUSE TO RECEIVE AND PROVIDE PROMPT
   37  REVIEW  OF  PRODUCTS  COVERED  UNDER  THE COMPACT AND, IN CERTAIN CASES,
   38  ADVERTISEMENTS RELATED THERETO, SUBMITTED BY INSURERS AUTHORIZED  TO  DO
   39  BUSINESS IN ONE OR MORE COMPACTING STATES;
   40    (D)  TO  GIVE APPROPRIATE REGULATORY APPROVAL TO THOSE PRODUCT FILINGS
   41  AND ADVERTISEMENTS SATISFYING THE APPLICABLE UNIFORM STANDARD;
   42    (E) TO IMPROVE COORDINATION  OF  REGULATORY  RESOURCES  AND  EXPERTISE
   43  BETWEEN  STATE  INSURANCE  DEPARTMENTS  REGARDING THE SETTING OF UNIFORM
   44  STANDARDS AND REVIEW OF INSURANCE PRODUCTS COVERED UNDER THE COMPACT;
   45    (F) TO CREATE THE INTERSTATE INSURANCE PRODUCT REGULATION  COMMISSION;
   46  AND
   47    (G)  TO PERFORM SUCH OTHER RELATED FUNCTIONS AS MAY BE CONSISTENT WITH
   48  THE STATE REGULATION OF THE BUSINESS OF INSURANCE.
   49    S 8203. DEFINITIONS. AS USED IN THIS ARTICLE:
   50    (A) "ADVERTISEMENT" MEANS  ANY  MATERIAL  DESIGNED  TO  CREATE  PUBLIC
   51  INTEREST IN A PRODUCT, OR INDUCE THE PUBLIC TO PURCHASE, INCREASE, MODI-
   52  FY, REINSTATE, BORROW ON, SURRENDER, REPLACE OR RETAIN A POLICY, AS MORE
   53  SPECIFICALLY  DEFINED  IN  THE  RULES  AND  OPERATING  PROCEDURES OF THE
   54  COMMISSION.
       S. 3287                             3
    1    (B) "BY-LAWS" MEAN THOSE BY-LAWS ESTABLISHED BY THE COMMISSION FOR ITS
    2  GOVERNANCE OR FOR DIRECTING OR CONTROLLING THE COMMISSION'S  ACTIONS  OR
    3  CONDUCT.
    4    (C)  "COMPACTING STATE" MEANS ANY STATE WHICH HAS ENACTED THIS COMPACT
    5  LEGISLATION AND WHICH HAS NOT WITHDRAWN OR BEEN TERMINATED  PURSUANT  TO
    6  SECTION EIGHT THOUSAND TWO HUNDRED FIFTEEN OF THIS ARTICLE.
    7    (D)  "COMMISSION"  MEANS  THE "INTERSTATE INSURANCE PRODUCT REGULATION
    8  COMMISSION" ESTABLISHED BY THE COMPACT.
    9    (E) "COMMISSIONER" MEANS THE CHIEF INSURANCE REGULATORY OFFICIAL OF  A
   10  STATE INCLUDING, BUT NOT LIMITED TO COMMISSIONER, SUPERINTENDENT, DIREC-
   11  TOR OR ADMINISTRATOR.
   12    (F)  "DOMICILIARY STATE" MEANS THE STATE IN WHICH AN INSURER IS INCOR-
   13  PORATED OR ORGANIZED OR, IN THE CASE OF AN ALIEN INSURER, ITS  STATE  OF
   14  ENTRY.
   15    (G)  "INSURER" MEANS ANY ENTITY LICENSED BY A STATE TO ISSUE CONTRACTS
   16  OF INSURANCE FOR ANY OF THE LINES OF INSURANCE COVERED BY THIS ARTICLE.
   17    (H) "MEMBER" MEANS THE PERSON, OR HIS OR HER  DESIGNEE,  CHOSEN  BY  A
   18  COMPACTING STATE FOR SERVICE ON THE COMMISSION.
   19    (I)  "NON-COMPACTING STATE" MEANS ANY STATE WHICH IS NOT AT THE TIME A
   20  COMPACTING STATE.
   21    (J) "OPERATING PROCEDURES" MEAN PROCEDURES PROMULGATED BY THE  COMMIS-
   22  SION  IMPLEMENTING  A  RULE,  UNIFORM  STANDARD  OR  A PROVISION OF THIS
   23  COMPACT.
   24    (K) "PRODUCT" MEANS THE FORM  OF  THE  CONTRACT,  POLICY  APPLICATION,
   25  ENDORSEMENTS,  CERTIFICATE FORMS, EVIDENCE OF COVERAGE FORMS AND RELATED
   26  FORMS FOR AN INDIVIDUAL OR GROUP  ANNUITY,  LIFE  INSURANCE,  DISABILITY
   27  INCOME  OR LONG-TERM CARE INSURANCE PRODUCT, WHICH AN INSURER IS AUTHOR-
   28  IZED TO ISSUE.
   29    (L) "RULE" MEANS A STATEMENT OF GENERAL  OR  PARTICULAR  APPLICABILITY
   30  AND  FUTURE  EFFECT  PROMULGATED  BY THE COMMISSION, INCLUDING A UNIFORM
   31  STANDARD DEVELOPED PURSUANT TO SECTION EIGHT THOUSAND TWO HUNDRED  EIGHT
   32  OF  THIS  ARTICLE, DESIGNED TO IMPLEMENT, INTERPRET, OR PRESCRIBE LAW OR
   33  POLICY OR DESCRIBING THE ORGANIZATION, PROCEDURE, OR  PRACTICE  REQUIRE-
   34  MENTS OF THE COMMISSION, WHICH SHALL HAVE THE FORCE AND EFFECT OF LAW IN
   35  THE COMPACTING STATES.
   36    (M)  "STATE"  MEANS  ANY  STATE,  DISTRICT  OR TERRITORY OF THE UNITED
   37  STATES OF AMERICA.
   38    (N) "THIRD-PARTY FILER" MEANS AN ENTITY THAT SUBMITS A PRODUCT  FILING
   39  TO THE COMMISSION ON BEHALF OF AN INSURER.
   40    (O)  "UNIFORM STANDARD" MEANS A STANDARD ADOPTED BY THE COMMISSION FOR
   41  A PRODUCT LINE, PURSUANT TO SECTION EIGHT THOUSAND TWO HUNDRED EIGHT  OF
   42  THIS ARTICLE AND SHALL INCLUDE ALL OF THE PRODUCT REQUIREMENTS IN AGGRE-
   43  GATE;  PROVIDED,  THAT EACH UNIFORM STANDARD SHALL BE CONSTRUED, WHETHER
   44  EXPRESS OR IMPLIED, TO PROHIBIT THE USE OF ANY INCONSISTENT,  MISLEADING
   45  OR  AMBIGUOUS  PROVISIONS IN A PRODUCT AND THE FORM OF SUCH PRODUCT MADE
   46  AVAILABLE TO THE PUBLIC SHALL NOT  BE  UNFAIR,  INEQUITABLE  OR  AGAINST
   47  PUBLIC POLICY AS DETERMINED BY THE COMMISSION.
   48    S  8204. ESTABLISHMENT OF THE COMMISSION AND VENUE. (A) THE COMPACTING
   49  STATES HEREBY ESTABLISH A JOINT PUBLIC AGENCY KNOWN AS  THE  "INTERSTATE
   50  INSURANCE  PRODUCT  REGULATION  COMMISSION".  PURSUANT  TO SECTION EIGHT
   51  THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE, THE  COMMISSION  SHALL  HAVE
   52  THE  POWER  TO  DEVELOP UNIFORM STANDARDS FOR PRODUCT LINES, RECEIVE AND
   53  PROVIDE PROMPT REVIEW OF PRODUCTS FILED THEREWITH, AND GIVE APPROVAL  TO
   54  THOSE PRODUCT FILINGS SATISFYING APPLICABLE UNIFORM STANDARDS; PROVIDED,
   55  HOWEVER,  THAT IT IS NOT INTENDED FOR THE COMMISSION TO BE THE EXCLUSIVE
   56  ENTITY FOR RECEIPT AND REVIEW OF INSURANCE PRODUCT FILINGS.  NOTHING  IN
       S. 3287                             4
    1  THIS  SECTION  SHALL PROHIBIT ANY INSURER FROM FILING ITS PRODUCT IN ANY
    2  STATE WHEREIN SUCH INSURER IS LICENSED TO CONDUCT THE BUSINESS OF INSUR-
    3  ANCE AND SUCH FILING SHALL BE SUBJECT TO THE LAWS  OF  THE  STATE  WHERE
    4  FILED.
    5    (B)  THE COMMISSION IS A BODY CORPORATE AND POLITIC, AND AN INSTRUMEN-
    6  TALITY OF THE COMPACTING STATES.
    7    (C) THE COMMISSION IS A NOT-FOR-PROFIT ENTITY, SEPARATE  AND  DISTINCT
    8  FROM THE INDIVIDUAL COMPACTING STATES.
    9    (D)  THE  COMMISSION  IS SOLELY RESPONSIBLE FOR ITS LIABILITIES UNLESS
   10  OTHERWISE SPECIFICALLY PROVIDED IN THIS  COMPACT,  EXCEPT  THAT,  IN  NO
   11  EVENT  SHALL  THE OBLIGATIONS OF THE COMMISSION BE THE DEBT OF THE STATE
   12  OF NEW YORK NOR SHALL ANY REVENUES OR PROPERTY OF THE STATE OF NEW  YORK
   13  BE LIABLE THEREFOR.
   14    (E) VENUE IN PROPER AND JUDICIAL PROCEEDINGS BY OR AGAINST THE COMMIS-
   15  SION  SHALL  BE  BROUGHT  SOLELY AND EXCLUSIVELY IN A COURT OF COMPETENT
   16  JURISDICTION WHERE THE PRINCIPAL OFFICE OF THE COMMISSION IS LOCATED.
   17    S 8205. POWERS OF THE COMMISSION. (A) THE COMMISSION  SHALL  HAVE  THE
   18  FOLLOWING POWERS:
   19    (1)  TO  PROMULGATE  RULES,  PURSUANT  TO  SECTION  EIGHT THOUSAND TWO
   20  HUNDRED EIGHT OF THIS ARTICLE, WHICH SHALL HAVE THE FORCE AND EFFECT  OF
   21  LAW  AND  SHALL BE BINDING IN THE COMPACTING STATES TO THE EXTENT AND IN
   22  THE MANNER PROVIDED IN THIS ARTICLE;
   23    (2) TO EXERCISE ITS RULE MAKING  AUTHORITY  AND  ESTABLISH  REASONABLE
   24  UNIFORM STANDARDS FOR PRODUCTS COVERED UNDER THE COMPACT, AND ADVERTISE-
   25  MENT  RELATED  THERETO, WHICH SHALL HAVE THE FORCE AND EFFECT OF LAW AND
   26  SHALL BE BINDING IN THE COMPACTING STATES, BUT ONLY  FOR  SUCH  PRODUCTS
   27  FILED  WITH  THE  COMMISSION; PROVIDED, HOWEVER, THAT A COMPACTING STATE
   28  SHALL HAVE THE RIGHT TO OPT OUT OF SUCH  UNIFORM  STANDARD  PURSUANT  TO
   29  SECTION  EIGHT  THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE TO THE EXTENT
   30  AND IN THE MANNER PROVIDED IN THIS ARTICLE, AND  PROVIDED  FURTHER  THAT
   31  ANY  UNIFORM STANDARD ESTABLISHED BY THE COMMISSIONER FOR LONG-TERM CARE
   32  INSURANCE PRODUCTS MAY PROVIDE  THE  SAME  OR  GREATER  PROTECTIONS  FOR
   33  CONSUMERS  AS,  BUT  SHALL  NOT PROVIDE LESS THAN, THOSE PROTECTIONS SET
   34  FORTH IN THE NATIONAL ASSOCIATION OF INSURANCE  COMMISSIONERS'  (HEREIN-
   35  AFTER  REFERRED TO AS THE "NAIC") LONG-TERM CARE INSURANCE MODEL ACT AND
   36  LONG-TERM CARE INSURANCE MODEL REGULATION, RESPECTIVELY, ADOPTED  AS  OF
   37  2001. THE COMMISSION SHALL CONSIDER WHETHER ANY SUBSEQUENT AMENDMENTS TO
   38  THE  NAIC LONG-TERM CARE INSURANCE MODEL ACT OR LONG-TERM CARE INSURANCE
   39  MODEL REGULATION ADOPTED BY THE NAIC REQUIRE  AMENDING  OF  THE  UNIFORM
   40  STANDARDS   ESTABLISHED   BY  THE  COMMISSION  FOR  LONG-TERM  INSURANCE
   41  PRODUCTS;
   42    (3) TO RECEIVE AND REVIEW IN AN EXPEDITIOUS MANNER PRODUCTS FILED WITH
   43  THE  COMMISSION,  INCLUDING  RATE  FILINGS  FOR  DISABILITY  INCOME  AND
   44  LONG-TERM  CARE  INSURANCE PRODUCTS, AND GIVE APPROVAL OF THOSE PRODUCTS
   45  AND RATE FILINGS THAT SATISFY THE  APPLICABLE  UNIFORM  STANDARD,  WHERE
   46  SUCH  APPROVAL  SHALL HAVE THE FORCE AND EFFECT OF LAW AND BE BINDING ON
   47  THE COMPACTING STATES TO THE EXTENT AND IN THE MANNER  PROVIDED  IN  THE
   48  COMPACT;
   49    (4)  TO  RECEIVE  AND  REVIEW  IN  AN EXPEDITIOUS MANNER ADVERTISEMENT
   50  RELATING TO LONG-TERM CARE INSURANCE PRODUCTS FOR WHICH  UNIFORM  STAND-
   51  ARDS  HAVE  BEEN  ADOPTED  BY  THE COMMISSION, AND GIVE APPROVAL OF SUCH
   52  ADVERTISEMENT THAT SATISFIES THE APPLICABLE UNIFORM  STANDARD.  FOR  ANY
   53  PRODUCT  COVERED UNDER THIS ARTICLE, OTHER THAN LONG-TERM CARE INSURANCE
   54  PRODUCTS, THE COMMISSION SHALL HAVE THE AUTHORITY TO REQUIRE AN  INSURER
   55  TO  SUBMIT  ALL  OR  ANY  PART OF ITS ADVERTISEMENT WITH RESPECT TO THAT
   56  PRODUCT FOR REVIEW OR APPROVAL PRIOR TO USE IF THE COMMISSION DETERMINES
       S. 3287                             5
    1  THAT THE NATURE OF THE PRODUCT IS SUCH  THAT  AN  ADVERTISEMENT  OF  THE
    2  PRODUCT  COULD  HAVE THE CAPACITY OR TENDENCY TO MISLEAD THE PUBLIC. THE
    3  ACTIONS OF THE COMMISSION AS PROVIDED IN THIS  SECTION  SHALL  HAVE  THE
    4  FORCE AND EFFECT OF LAW AND SHALL BE BINDING IN THE COMPACTING STATES TO
    5  THE EXTENT AND IN THE MANNER PROVIDED IN THE COMPACT;
    6    (5)  TO  EXERCISE  RULE  MAKING  AUTHORITY  AND DESIGNATE PRODUCTS AND
    7  ADVERTISEMENT THAT MAY BE SUBJECT TO A SELF-CERTIFICATION PROCESS  WITH-
    8  OUT THE NEED FOR PRIOR APPROVAL BY THE COMMISSION;
    9    (6)  TO  PROMULGATE  OPERATING  PROCEDURES,  PURSUANT TO SECTION EIGHT
   10  THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE, WHICH SHALL  BE  BINDING  IN
   11  THE  COMPACTING  STATES  TO THE EXTENT AND IN THE MANNER PROVIDED IN THE
   12  COMPACT;
   13    (7) TO BRING AND PROSECUTE LEGAL PROCEEDINGS OR ACTIONS IN ITS NAME AS
   14  THE COMMISSION; PROVIDED, THAT  THE  STANDING  OF  ANY  STATE  INSURANCE
   15  DEPARTMENT TO SUE OR BE SUED UNDER APPLICABLE LAW SHALL NOT BE AFFECTED;
   16    (8)  TO  ISSUE  SUBPOENAS  REQUIRING  THE  ATTENDANCE AND TESTIMONY OF
   17  WITNESSES AND THE PRODUCTION OF EVIDENCE;
   18    (9) TO ESTABLISH AND MAINTAIN OFFICES;
   19    (10) TO PURCHASE AND MAINTAIN INSURANCE AND BONDS;
   20    (11) TO BORROW, ACCEPT OR CONTRACT FOR SERVICES OF PERSONNEL,  INCLUD-
   21  ING, BUT NOT LIMITED TO, EMPLOYEES OF A COMPACTING STATE;
   22    (12) TO HIRE EMPLOYEES AND ELECT OR APPOINT OFFICERS, AND TO FIX THEIR
   23  COMPENSATION, DEFINE THEIR DUTIES AND GIVE THEM APPROPRIATE AUTHORITY TO
   24  CARRY  OUT  THE  PURPOSES OF THE COMPACT, AND DETERMINE THEIR QUALIFICA-
   25  TIONS; AND TO ESTABLISH THE COMMISSION'S PERSONNEL POLICIES AND PROGRAMS
   26  RELATING TO, AMONG OTHER THINGS, CONFLICTS OF INTEREST, RATES OF COMPEN-
   27  SATION AND QUALIFICATIONS OF PERSONNEL;
   28    (13) TO ACCEPT ANY AND ALL APPROPRIATE DONATIONS AND GRANTS OF  MONEY,
   29  EQUIPMENT, SUPPLIES, MATERIALS AND SERVICES, AND TO RECEIVE, UTILIZE AND
   30  DISPOSE  OF  THE  SAME;  PROVIDED THAT AT ALL TIMES THE COMMISSION SHALL
   31  STRIVE TO AVOID ANY APPEARANCE OF IMPROPRIETY;
   32    (14) TO LEASE, PURCHASE, ACCEPT APPROPRIATE GIFTS OR DONATIONS OF,  OR
   33  OTHERWISE  TO OWN, HOLD, IMPROVE OR USE, ANY PROPERTY, REAL, PERSONAL OR
   34  MIXED; PROVIDED THAT AT ALL TIMES THE COMMISSION SHALL STRIVE  TO  AVOID
   35  ANY APPEARANCE OF IMPROPRIETY;
   36    (15)  TO  SELL,  CONVEY, MORTGAGE, PLEDGE, LEASE, EXCHANGE, ABANDON OR
   37  OTHERWISE DISPOSE OF ANY PROPERTY, REAL, PERSONAL OR MIXED;
   38    (16) TO REMIT FILING FEES TO COMPACTING STATES AS MAY BE SET FORTH  IN
   39  THE BY-LAWS, RULES OR OPERATING PROCEDURES;
   40    (17)  TO  ENFORCE  COMPLIANCE BY COMPACTING STATES WITH RULES, UNIFORM
   41  STANDARDS, OPERATING PROCEDURES AND BY-LAWS;
   42    (18) TO PROVIDE FOR DISPUTE RESOLUTION AMONG COMPACTING STATES;
   43    (19) TO ADVISE COMPACTING STATES ON ISSUES RELATING TO INSURERS  DOMI-
   44  CILED OR DOING BUSINESS IN NON-COMPACTING JURISDICTIONS, CONSISTENT WITH
   45  THE PURPOSES OF THE COMPACT;
   46    (20) TO PROVIDE ADVICE AND TRAINING TO THOSE PERSONNEL IN STATE INSUR-
   47  ANCE  DEPARTMENTS  RESPONSIBLE  FOR PRODUCT REVIEW, AND TO BE A RESOURCE
   48  FOR STATE INSURANCE DEPARTMENTS;
   49    (21) TO ESTABLISH A BUDGET AND MAKE EXPENDITURES;
   50    (22) TO BORROW MONEY;
   51    (23) TO APPOINT COMMITTEES, INCLUDING ADVISORY  COMMITTEES  COMPRISING
   52  MEMBERS,  STATE  INSURANCE REGULATORS, STATE LEGISLATORS OR THEIR REPRE-
   53  SENTATIVES, INSURANCE INDUSTRY AND CONSUMER  REPRESENTATIVES,  AND  SUCH
   54  OTHER INTERESTED PERSONS AS MAY BE DESIGNATED IN THE BY-LAWS;
   55    (24)  TO  PROVIDE  AND RECEIVE INFORMATION FROM, AND TO COOPERATE WITH
   56  LAW ENFORCEMENT AGENCIES;
       S. 3287                             6
    1    (25) TO ADOPT AND USE A CORPORATE SEAL; AND
    2    (26)  TO PERFORM SUCH OTHER FUNCTIONS AS MAY BE NECESSARY OR APPROPRI-
    3  ATE TO ACHIEVE THE PURPOSES OF THIS COMPACT CONSISTENT  WITH  THE  STATE
    4  REGULATION OF THE BUSINESS OF INSURANCE.
    5    (B)  ALL DONATIONS, GRANTS OF MONEY, EQUIPMENT, SUPPLIES, MATERIALS OR
    6  SERVICES, PURCHASES, GIFTS, DONATIONS, CONVEYANCES, MORTGAGES,  PLEDGES,
    7  LEASES  AND  EXCHANGES, AS AUTHORIZED BY SUBSECTION (A) OF THIS SECTION,
    8  RECEIVED BY OR ON BEHALF OF THE  COMMISSION  SHALL  BE  LIMITED  TO  THE
    9  DIRECT  FUNDING  OF  THE LAWFUL AND AUTHORIZED OPERATIONS OF THE COMMIS-
   10  SION.
   11    S 8206. ORGANIZATION OF THE  COMMISSION.  (A)  EACH  COMPACTING  STATE
   12  SHALL  HAVE  AND BE LIMITED TO ONE MEMBER. THE SUPERINTENDENT, OR HIS OR
   13  HER DESIGNATED REPRESENTATIVE,  SHALL  BE  NEW  YORK'S  MEMBER  OF  SUCH
   14  COMMISSION.  EACH  MEMBER  SHALL  BE QUALIFIED TO SERVE IN SUCH CAPACITY
   15  PURSUANT TO APPLICABLE LAW OF THE COMPACTING STATE. ANY  MEMBER  MAY  BE
   16  REMOVED  OR  SUSPENDED  FROM  OFFICE AS PROVIDED BY THE LAW OF THE STATE
   17  FROM WHICH HE OR SHE SHALL BE APPOINTED. ANY VACANCY  OCCURRING  IN  THE
   18  COMMISSION SHALL BE FILLED IN ACCORDANCE WITH THE LAWS OF THE COMPACTING
   19  STATE  WHEREIN SUCH VACANCY EXISTS. NOTHING HEREIN SHALL BE CONSTRUED TO
   20  AFFECT THE MANNER IN WHICH A COMPACTING STATE DETERMINES THE ELECTION OR
   21  APPOINTMENT AND QUALIFICATION OF ITS OWN SUPERINTENDENT.
   22    (B) EACH MEMBER SHALL BE ENTITLED TO ONE VOTE AND SHALL HAVE AN OPPOR-
   23  TUNITY TO PARTICIPATE IN THE GOVERNANCE OF THE COMMISSION IN  ACCORDANCE
   24  WITH  THE  BY-LAWS. NOTWITHSTANDING ANY PROVISION OF THIS ARTICLE TO THE
   25  CONTRARY, NO ACTION OF THE COMMISSION WITH RESPECT TO  THE  PROMULGATION
   26  OF  A  UNIFORM  STANDARD  SHALL  BE  EFFECTIVE  UNLESS TWO-THIRDS OF THE
   27  MEMBERS VOTE IN FAVOR THEREOF.
   28    (C) THE COMMISSION SHALL, BY A  MAJORITY  OF  THE  MEMBERS,  PRESCRIBE
   29  BY-LAWS  TO  GOVERN  ITS  CONDUCT  AS MAY BE NECESSARY OR APPROPRIATE TO
   30  CARRY OUT THE PURPOSES, AND EXERCISE THE POWERS, OF THE COMPACT, INCLUD-
   31  ING, BUT NOT LIMITED TO:
   32    (1) ESTABLISHING THE FISCAL YEAR OF THE COMMISSION;
   33    (2) PROVIDING  REASONABLE  PROCEDURES  FOR  HOLDING  MEETINGS  OF  THE
   34  MANAGEMENT COMMITTEE;
   35    (3)  PROVIDING  REASONABLE STANDARDS AND PROCEDURES FOR THE ESTABLISH-
   36  MENT OF OTHER COMMITTEES, AND GOVERNING ANY GENERAL OR  SPECIFIC  DELEG-
   37  ATION OF ANY AUTHORITY OR FUNCTION OF THE COMMISSION;
   38    (4)  PROVIDING  REASONABLE PROCEDURES FOR CALLING AND CONDUCTING MEET-
   39  INGS OF THE COMMISSION THAT CONSIST OF A MAJORITY OF COMMISSION MEMBERS,
   40  ENSURING REASONABLE ADVANCE NOTICE OF EACH SUCH MEETING,  AND  PROVIDING
   41  FOR  THE  RIGHT  OF CITIZENS TO ATTEND EACH SUCH MEETING WITH ENUMERATED
   42  EXCEPTIONS DESIGNED TO PROTECT THE PUBLIC'S  INTEREST,  THE  PRIVACY  OF
   43  INDIVIDUALS  AND  INSURERS'  PROPRIETARY  INFORMATION,  INCLUDING  TRADE
   44  SECRETS. THE COMMISSION MAY MEET IN CAMERA ONLY AFTER A MAJORITY OF  THE
   45  ENTIRE  MEMBERSHIP  VOTES TO CLOSE A MEETING IN TOTO OR IN PART. AS SOON
   46  AS PRACTICABLE, THE COMMISSION MUST MAKE PUBLIC A COPY OF  THE  VOTE  TO
   47  CLOSE  THE MEETING REVEALING THE VOTE OF EACH MEMBER WITH NO PROXY VOTES
   48  ALLOWED, AND VOTES TAKEN DURING SUCH MEETING;
   49    (5) ESTABLISHING THE  TITLES,  DUTIES  AND  AUTHORITY  AND  REASONABLE
   50  PROCEDURES FOR THE ELECTION OF THE OFFICERS OF THE COMMISSION;
   51    (6)  PROVIDING  REASONABLE STANDARDS AND PROCEDURES FOR THE ESTABLISH-
   52  MENT OF THE PERSONNEL POLICIES AND PROGRAMS OF THE COMMISSION.  NOTWITH-
   53  STANDING ANY CIVIL SERVICE OR  OTHER  SIMILAR  LAWS  OF  ANY  COMPACTING
   54  STATE,  THE  BY-LAWS SHALL EXCLUSIVELY GOVERN THE PERSONNEL POLICIES AND
   55  PROGRAMS OF THE COMMISSION;
       S. 3287                             7
    1    (7) PROMULGATING A CODE OF ETHICS TO ADDRESS PERMISSIBLE AND PROHIBIT-
    2  ED ACTIVITIES OF COMMISSION MEMBERS AND EMPLOYEES; AND
    3    (8) PROVIDING A MECHANISM FOR WINDING UP THE OPERATIONS OF THE COMMIS-
    4  SION  AND  THE EQUITABLE DISPOSITION OF ANY SURPLUS FUNDS THAT MAY EXIST
    5  AFTER THE TERMINATION OF THE COMPACT AFTER THE PAYMENT AND/OR  RESERVING
    6  OF ALL OF ITS DEBTS AND OBLIGATIONS.
    7    (D)  THE COMMISSION SHALL PUBLISH ITS BY-LAWS IN A CONVENIENT FORM AND
    8  FILE A COPY THEREOF AND A COPY OF ANY AMENDMENT THERETO, WITH THE APPRO-
    9  PRIATE AGENCY OR OFFICER IN EACH OF THE COMPACTING STATES.
   10    (E) A MANAGEMENT COMMITTEE COMPRISING NO MORE  THAN  FOURTEEN  MEMBERS
   11  SHALL BE ESTABLISHED AS FOLLOWS:
   12    (1) ONE MEMBER FROM EACH OF THE SIX COMPACTING STATES WITH THE LARGEST
   13  PREMIUM  VOLUME  FOR  INDIVIDUAL  AND  GROUP ANNUITIES, LIFE, DISABILITY
   14  INCOME AND  LONG-TERM  CARE  INSURANCE  PRODUCTS,  DETERMINED  FROM  THE
   15  RECORDS OF THE NAIC AS OF DECEMBER THIRTY-FIRST OF THE PRIOR YEAR;
   16    (2)  FOUR  MEMBERS  FROM  THOSE  COMPACTING  STATES  WITH AT LEAST TWO
   17  PERCENT OF THE MARKET BASED ON THE PREMIUM VOLUME DESCRIBED IN PARAGRAPH
   18  ONE OF THIS SUBSECTION, OTHER THAN SIX COMPACTING STATES WITH THE  LARG-
   19  EST  PREMIUM  VOLUME,  SELECTED  ON  A ROTATING BASIS AS PROVIDED IN THE
   20  BY-LAWS; AND
   21    (3) FOUR MEMBERS FROM THOSE  COMPACTING  STATES  WITH  LESS  THAN  TWO
   22  PERCENT  OF  THE  MARKET, BASED ON THE PREMIUM VOLUME DESCRIBED IN PARA-
   23  GRAPH ONE OF THIS SUBSECTION, WITH ONE SELECTED FROM EACH  OF  THE  FOUR
   24  ZONE REGIONS OF THE NAIC AS PROVIDED IN THE BY-LAWS.
   25    (F)  THE  MANAGEMENT COMMITTEE SHALL HAVE SUCH AUTHORITY AND DUTIES AS
   26  MAY BE SET FORTH IN THE BY-LAWS, INCLUDING BUT NOT LIMITED TO:
   27    (1) MANAGING THE AFFAIRS OF THE COMMISSION IN A MANNER CONSISTENT WITH
   28  THE BY-LAWS AND PURPOSES OF THE COMMISSION;
   29    (2) ESTABLISHING AND OVERSEEING AN  ORGANIZATIONAL  STRUCTURE  WITHIN,
   30  AND  APPROPRIATE  PROCEDURES  FOR,  THE  COMMISSION  TO  PROVIDE FOR THE
   31  CREATION OF UNIFORM STANDARDS AND OTHER RULES,  RECEIPT  AND  REVIEW  OF
   32  PRODUCT  FILINGS, ADMINISTRATIVE AND TECHNICAL SUPPORT FUNCTIONS, REVIEW
   33  OF DECISIONS REGARDING THE DISAPPROVAL OF  A  PRODUCT  FILING,  AND  THE
   34  REVIEW  OF  ELECTIONS MADE BY A COMPACTING STATE TO OPT OUT OF A UNIFORM
   35  STANDARD; PROVIDED THAT A UNIFORM STANDARD SHALL NOT BE SUBMITTED TO THE
   36  COMPACTING STATES FOR ADOPTION UNLESS  APPROVED  BY  TWO-THIRDS  OF  THE
   37  MEMBERS OF THE MANAGEMENT COMMITTEE;
   38    (3) OVERSEEING THE OFFICES OF THE COMMISSION; AND
   39    (4) PLANNING, IMPLEMENTING, AND COORDINATING COMMUNICATIONS AND ACTIV-
   40  ITIES  WITH  OTHER  STATE, FEDERAL AND LOCAL GOVERNMENT ORGANIZATIONS IN
   41  ORDER TO ADVANCE THE GOALS OF THE COMMISSION.
   42    (G) THE COMMISSION SHALL ELECT ANNUALLY OFFICERS FROM  THE  MANAGEMENT
   43  COMMITTEE,  WITH EACH HAVING SUCH AUTHORITY AND DUTIES, AS MAY BE SPECI-
   44  FIED IN THE BY-LAWS.
   45    (H) THE MANAGEMENT COMMITTEE MAY,  SUBJECT  TO  THE  APPROVAL  OF  THE
   46  COMMISSION,  APPOINT  OR  RETAIN  AN EXECUTIVE DIRECTOR FOR SUCH PERIOD,
   47  UPON SUCH TERMS AND CONDITIONS AND FOR SUCH COMPENSATION AS THE  COMMIS-
   48  SION  MAY DEEM APPROPRIATE. THE EXECUTIVE DIRECTOR SHALL SERVE AS SECRE-
   49  TARY TO THE COMMISSION, BUT SHALL NOT BE A MEMBER OF THE COMMISSION. THE
   50  EXECUTIVE DIRECTOR SHALL HIRE AND SUPERVISE SUCH OTHER STAFF AS  MAY  BE
   51  AUTHORIZED BY THE COMMISSION.
   52    (I)  A  LEGISLATIVE  COMMITTEE  COMPRISING  STATE LEGISLATORS OR THEIR
   53  DESIGNEES SHALL BE ESTABLISHED TO MONITOR THE OPERATIONS  OF,  AND  MAKE
   54  RECOMMENDATIONS   TO,  THE  COMMISSION;  PROVIDED  THAT  THE  MANNER  OF
   55  SELECTION AND TERM OF ANY LEGISLATIVE COMMITTEE MEMBER SHALL BE  AS  SET
   56  FORTH  IN  THE  BY-LAWS.  PRIOR TO THE ADOPTION BY THE COMMISSION OF ANY
       S. 3287                             8
    1  UNIFORM STANDARD, REVISION  TO  THE  BY-LAWS,  ANNUAL  BUDGET  OR  OTHER
    2  SIGNIFICANT  MATTER  AS  MAY  BE PROVIDED IN THE BY-LAWS, THE MANAGEMENT
    3  COMMITTEE SHALL CONSULT WITH AND REPORT TO THE LEGISLATIVE COMMITTEE.
    4    (J)  THE  COMMISSION  SHALL  ESTABLISH TWO ADVISORY COMMITTEES, ONE OF
    5  WHICH SHALL COMPRISE CONSUMER REPRESENTATIVES INDEPENDENT OF THE  INSUR-
    6  ANCE  INDUSTRY  AND  THE  OTHER  COMPRISING INSURANCE INDUSTRY REPRESEN-
    7  TATIVES.
    8    (K) THE COMMISSION MAY ESTABLISH ADDITIONAL ADVISORY COMMITTEES AS ITS
    9  BY-LAWS MAY PROVIDE FOR THE CARRYING OUT OF ITS FUNCTIONS.
   10    (L) THE COMMISSION SHALL MAINTAIN ITS CORPORATE BOOKS AND  RECORDS  IN
   11  ACCORDANCE WITH THE BY-LAWS.
   12    (M) THE MEMBERS, OFFICERS, EXECUTIVE DIRECTOR, EMPLOYEES AND REPRESEN-
   13  TATIVES  OF  THE  COMMISSION  SHALL  BE  IMMUNE FROM SUIT AND LIABILITY,
   14  EITHER PERSONALLY OR IN THEIR OFFICIAL CAPACITY, FOR  ANY  ACTION  TAKEN
   15  REASONABLY  AND  IN GOOD FAITH WHICH RESULTS IN A CLAIM FOR DAMAGE TO OR
   16  LOSS OF PROPERTY OR PERSONAL INJURY OR OTHER CIVIL LIABILITY  CAUSED  BY
   17  OR  ARISING  OUT  OF  ANY  ACTUAL OR ALLEGED ACT, ERROR OR OMISSION THAT
   18  OCCURRED, OR THAT SUCH PERSON  HAD  A  REASONABLE  BASIS  FOR  BELIEVING
   19  OCCURRED  WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR RESPONSI-
   20  BILITIES; PROVIDED, THAT NOTHING IN THIS SECTION SHALL BE  CONSTRUED  TO
   21  PROTECT ANY SUCH PERSON FROM SUIT AND/OR LIABILITY FOR ANY DAMAGE, LOSS,
   22  INJURY  OR  LIABILITY  CAUSED  BY  THE INTENTIONAL OR WILLFUL AND WANTON
   23  MISCONDUCT OF THAT PERSON.
   24    (N) THE COMMISSION SHALL DEFEND ANY MEMBER, OFFICER, EXECUTIVE  DIREC-
   25  TOR,  EMPLOYEE  OR  REPRESENTATIVE OF THE COMMISSION IN ANY CIVIL ACTION
   26  SEEKING TO IMPOSE LIABILITY ARISING OUT OF ANY ACTUAL  OR  ALLEGED  ACT,
   27  ERROR  OR  OMISSION THAT OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOY-
   28  MENT, DUTIES OR RESPONSIBILITIES, OR THAT THE DEFENDANT HAD A REASONABLE
   29  BASIS FOR BELIEVING OCCURRED WITHIN THE SCOPE OF COMMISSION  EMPLOYMENT,
   30  DUTIES OR RESPONSIBILITIES; PROVIDED, THAT NOTHING IN THIS SECTION SHALL
   31  BE CONSTRUED TO PROHIBIT THAT PERSON FROM RETAINING HIS OR HER OWN COUN-
   32  SEL;  AND  PROVIDED  FURTHER,  THAT  THE ACTUAL OR ALLEGED ACT, ERROR OR
   33  OMISSION DID NOT RESULT FROM THAT PERSON'S INTENTIONAL  OR  WILLFUL  AND
   34  WANTON MISCONDUCT.
   35    (O) THE COMMISSION SHALL INDEMNIFY AND HOLD HARMLESS ANY MEMBER, OFFI-
   36  CER,  EXECUTIVE  DIRECTOR,  EMPLOYEE OR REPRESENTATIVE OF THE COMMISSION
   37  FOR THE AMOUNT OF ANY  SETTLEMENT  OR  JUDGMENT  OBTAINED  AGAINST  SUCH
   38  PERSONS ARISING OUT OF ANY ACTUAL OR ALLEGED ACT, ERROR OR OMISSION THAT
   39  OCCURRED  WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR RESPONSI-
   40  BILITIES, OR THAT SUCH PERSON  HAD  A  REASONABLE  BASIS  FOR  BELIEVING
   41  OCCURRED  WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR RESPONSI-
   42  BILITIES, PROVIDED, THAT THE ACTUAL OR ALLEGED ACT,  ERROR  OR  OMISSION
   43  DID  NOT RESULT FROM THE INTENTIONAL OR WILLFUL AND WANTON MISCONDUCT OF
   44  ANY SUCH PERSON.
   45    S 8207. MEETINGS AND ACTS OF THE COMMISSION. (A) THE COMMISSION  SHALL
   46  MEET AND TAKE SUCH ACTIONS AS ARE CONSISTENT WITH THE PROVISIONS OF THIS
   47  COMPACT AND THE BY-LAWS.
   48    (B)  EACH  MEMBER  OF THE COMMISSION SHALL HAVE THE RIGHT AND POWER TO
   49  CAST A VOTE TO WHICH THAT COMPACTING STATE IS ENTITLED  AND  TO  PARTIC-
   50  IPATE IN THE BUSINESS AND AFFAIRS OF THE COMMISSION. A MEMBER SHALL VOTE
   51  IN PERSON OR BY SUCH OTHER MEANS AS PROVIDED IN THE BY-LAWS. THE BY-LAWS
   52  MAY PROVIDE FOR MEMBERS' PARTICIPATION IN MEETINGS BY TELEPHONE OR OTHER
   53  MEANS OF COMMUNICATION.
   54    (C) THE COMMISSION SHALL MEET AT LEAST ONCE DURING EACH CALENDAR YEAR.
   55  ADDITIONAL MEETINGS SHALL BE HELD AS SET FORTH IN THE BY-LAWS.
       S. 3287                             9
    1    S  8208.  RULES AND OPERATING PROCEDURES; RULE MAKING FUNCTIONS OF THE
    2  COMMISSION AND OPTING OUT OF UNIFORM STANDARDS. (A) THE COMMISSION SHALL
    3  PROMULGATE REASONABLE RULES, INCLUDING UNIFORM STANDARDS  AND  OPERATING
    4  PROCEDURES, IN ORDER TO EFFECTIVELY AND EFFICIENTLY ACHIEVE THE PURPOSES
    5  OF  THE COMPACT. NOTWITHSTANDING THE FOREGOING, IN THE EVENT THE COMMIS-
    6  SION EXERCISES ITS RULE MAKING AUTHORITY IN A MANNER THAT IS BEYOND  THE
    7  SCOPE  OF  THE  PURPOSES  OF THIS ARTICLE, OR THE POWERS GRANTED IN THIS
    8  SECTION, THEN SUCH ACTION BY THE COMMISSION SHALL BE INVALID AND HAVE NO
    9  FORCE AND EFFECT.
   10    (B) RULES AND OPERATING PROCEDURES SHALL BE MADE PURSUANT  TO  A  RULE
   11  MAKING  PROCESS  THAT CONFORMS TO THE STATE ADMINISTRATIVE PROCEDURE ACT
   12  OF 1981 AS AMENDED, AS MAY BE  APPROPRIATE  TO  THE  OPERATIONS  OF  THE
   13  COMMISSION. BEFORE THE COMMISSION ADOPTS A UNIFORM STANDARD, THE COMMIS-
   14  SION SHALL GIVE WRITTEN NOTICE TO THE RELEVANT STATE LEGISLATIVE COMMIT-
   15  TEE  IN  EACH  COMPACTING  STATE RESPONSIBLE FOR INSURANCE ISSUES OF ITS
   16  INTENTION TO ADOPT SUCH UNIFORM STANDARD. THE COMMISSION IN  ADOPTING  A
   17  UNIFORM  STANDARD SHALL CONSIDER FULLY ALL SUBMITTED MATERIALS AND ISSUE
   18  A CONCISE EXPLANATION OF ITS DECISION.
   19    (C) A UNIFORM STANDARD SHALL BECOME EFFECTIVE NINETY  DAYS  AFTER  ITS
   20  PROMULGATION  BY THE COMMISSION OR SUCH LATER DATE AS THE COMMISSION MAY
   21  DETERMINE; PROVIDED, HOWEVER, THAT A COMPACTING STATE MAY OPT OUT  OF  A
   22  UNIFORM STANDARD AS PROVIDED IN THIS ARTICLE. "OPT OUT" SHALL BE DEFINED
   23  AS  ANY  ACTION BY A COMPACTING STATE TO DECLINE TO ADOPT OR PARTICIPATE
   24  IN A PROMULGATED UNIFORM STANDARD. ALL OTHER RULES AND OPERATING  PROCE-
   25  DURES,  AND  AMENDMENTS  THERETO,  SHALL BECOME EFFECTIVE AS OF THE DATE
   26  SPECIFIED IN EACH RULE, OPERATING PROCEDURE OR AMENDMENT.
   27    (D) A COMPACTING STATE MAY OPT OUT OF A UNIFORM  STANDARD,  EITHER  BY
   28  LEGISLATION  OR  REGULATION DULY PROMULGATED BY THE SUPERINTENDENT UNDER
   29  THE STATE ADMINISTRATIVE PROCEDURE ACT. IF A COMPACTING STATE ELECTS  TO
   30  OPT OUT OF A UNIFORM STANDARD BY REGULATION, IT MUST GIVE WRITTEN NOTICE
   31  TO  THE  COMMISSION  NO  LATER  THAN TEN BUSINESS DAYS AFTER THE UNIFORM
   32  STANDARD IS PROMULGATED OR AT THE TIME THE STATE  BECOMES  A  COMPACTING
   33  STATE,  AND  FIND  THAT THE UNIFORM STANDARD DOES NOT PROVIDE REASONABLE
   34  PROTECTIONS TO THE CITIZENS OF THE STATE GIVEN  THE  CONDITIONS  IN  THE
   35  STATE.  THE  SUPERINTENDENT  SHALL  MAKE  SPECIFIC  FINDINGS OF FACT AND
   36  CONCLUSIONS OF LAW, BASED ON A PREPONDERANCE OF THE EVIDENCE,  DETAILING
   37  THE  CONDITIONS  IN THE STATE WHICH WARRANT A DEPARTURE FROM THE UNIFORM
   38  STANDARD AND DETERMINING THAT THE UNIFORM STANDARD WOULD NOT  REASONABLY
   39  PROTECT  THE CITIZENS OF THE STATE. THE SUPERINTENDENT MUST CONSIDER AND
   40  BALANCE THE FOLLOWING FACTORS AND FIND THAT THE CONDITIONS IN THE  STATE
   41  AND NEEDS OF THE CITIZENS OF THE STATE OUTWEIGH:
   42    (1)  THE INTENT OF THE LEGISLATURE TO PARTICIPATE IN, AND THE BENEFITS
   43  OF, AN INTERSTATE  AGREEMENT  TO  ESTABLISH  NATIONAL  UNIFORM  CONSUMER
   44  PROTECTIONS FOR THE PRODUCTS SUBJECT TO THIS ARTICLE; AND
   45    (2)  THE PRESUMPTION THAT A UNIFORM STANDARD ADOPTED BY THE COMMISSION
   46  PROVIDES REASONABLE PROTECTIONS TO CONSUMERS OF THE RELEVANT PRODUCT.
   47    NOTWITHSTANDING THE FOREGOING, A COMPACTING STATE MAY, AT THE TIME  OF
   48  ITS ENACTMENT OF THE COMPACT, PROSPECTIVELY OPT OUT OF ALL UNIFORM STAN-
   49  DARDS  INVOLVING  THE  LONG-TERM  CARE  INSURANCE  PRODUCTS BY EXPRESSLY
   50  PROVIDING FOR SUCH OPT OUT IN THE ENACTED  COMPACT,  AND  SUCH  OPT  OUT
   51  SHALL  NOT  BE TREATED AS A MATERIAL VARIANCE IN THE OFFER OR ACCEPTANCE
   52  OF ANY STATE TO PARTICIPATE IN THE COMPACT. SUCH AN  OPT  OUT  SHALL  BE
   53  EFFECTIVE  AT  THE  TIME  OF  ENACTMENT OF THE COMPACT BY THE COMPACTING
   54  STATE AND SHALL APPLY TO ALL EXISTING UNIFORM STANDARDS INVOLVING  LONG-
   55  TERM CARE INSURANCE PRODUCTS AND THOSE SUBSEQUENTLY PROMULGATED.
       S. 3287                            10
    1    (E) IF A COMPACTING STATE ELECTS TO OPT OUT OF A UNIFORM STANDARD, THE
    2  UNIFORM  STANDARD SHALL REMAIN APPLICABLE IN THE COMPACTING STATE ELECT-
    3  ING TO OPT OUT UNTIL SUCH TIME THE OPT OUT LEGISLATION IS  ENACTED  INTO
    4  LAW OR THE REGULATION IS PROMULGATED.
    5    (F)  ONCE  THE  OPT  OUT  OF  A UNIFORM STANDARD BY A COMPACTING STATE
    6  BECOMES EFFECTIVE AS PROVIDED UNDER THE LAWS OF THAT STATE, THE  UNIFORM
    7  STANDARD SHALL HAVE NO FURTHER FORCE AND EFFECT IN THAT STATE UNLESS AND
    8  UNTIL THE LEGISLATION OR REGULATION IMPLEMENTING THE OPT OUT IS REPEALED
    9  OR  OTHERWISE  BECOMES  INEFFECTIVE  UNDER  THE  LAWS OF THE STATE. IF A
   10  COMPACTING STATE OPTS OUT OF A UNIFORM STANDARD AFTER THE UNIFORM STAND-
   11  ARD HAS BEEN MADE EFFECTIVE IN THAT STATE, THE OPT OUT  SHALL  HAVE  THE
   12  SAME  PROSPECTIVE  EFFECT  AS  PROVIDED UNDER SECTION EIGHT THOUSAND TWO
   13  HUNDRED FIFTEEN OF THIS ARTICLE FOR WITHDRAWALS.
   14    (G) IF A COMPACTING STATE HAS FORMALLY INITIATED THE PROCESS OF OPTING
   15  OUT OF A UNIFORM STANDARD BY REGULATION, AND WHILE  THE  REGULATORY  OPT
   16  OUT  IS  PENDING,  THE  COMPACTING STATE MAY PETITION THE COMMISSION, AT
   17  LEAST FIFTEEN DAYS BEFORE THE EFFECTIVE DATE OF THE UNIFORM STANDARD, TO
   18  STAY THE EFFECTIVENESS OF  THE  UNIFORM  STANDARD  IN  THAT  STATE.  THE
   19  COMMISSION  MAY  GRANT A STAY IF IT DETERMINES THE REGULATORY OPT OUT IS
   20  BEING PURSUED IN A REASONABLE  MANNER  AND  THERE  IS  A  LIKELIHOOD  OF
   21  SUCCESS. IF A STAY IS GRANTED OR EXTENDED BY THE COMMISSION, THE STAY OR
   22  EXTENSION  THEREOF MAY POSTPONE THE EFFECTIVE DATE BY UP TO NINETY DAYS,
   23  UNLESS AFFIRMATIVELY EXTENDED BY THE  COMMISSION;  PROVIDED  HOWEVER,  A
   24  STAY  MAY  NOT  BE  PERMITTED TO REMAIN IN EFFECT FOR MORE THAN ONE YEAR
   25  UNLESS THE COMPACTING STATE CAN SHOW EXTRAORDINARY  CIRCUMSTANCES  WHICH
   26  WARRANT  A  CONTINUANCE  OF  THE STAY INCLUDING, BUT NOT LIMITED TO, THE
   27  EXISTENCE OF A LEGAL CHALLENGE WHICH PREVENTS THE COMPACTING STATE  FROM
   28  OPTING  OUT. A STAY MAY BE TERMINATED BY THE COMMISSION UPON NOTICE THAT
   29  THE RULE MAKING PROCESS HAS BEEN TERMINATED.
   30    (H) NOT LATER THAN THIRTY DAYS AFTER A RULE OR OPERATING PROCEDURE  IS
   31  PROMULGATED,  ANY  PERSON MAY FILE A PETITION FOR JUDICIAL REVIEW OF THE
   32  RULE OR OPERATING PROCEDURE; PROVIDED, HOWEVER, THAT THE FILING OF  SUCH
   33  A  PETITION  SHALL  NOT  STAY OR OTHERWISE PREVENT THE RULE OR OPERATING
   34  PROCEDURE FROM BECOMING EFFECTIVE UNLESS THE COURT FINDS THAT THE  PETI-
   35  TIONER  HAS  A  SUBSTANTIAL  LIKELIHOOD OF SUCCESS. THE COURT SHALL GIVE
   36  DEFERENCE TO THE ACTIONS OF THE COMMISSION  CONSISTENT  WITH  APPLICABLE
   37  LAW AND SHALL NOT FIND THE RULE OR OPERATING PROCEDURE TO BE UNLAWFUL IF
   38  THE  RULE OR OPERATING PROCEDURE REPRESENTS A REASONABLE EXERCISE OF THE
   39  COMMISSION'S AUTHORITY.
   40    S 8209. COMMISSION RECORDS AND ENFORCEMENT. (A) THE  COMMISSION  SHALL
   41  PROMULGATE  RULES  ESTABLISHING  CONDITIONS  AND  PROCEDURES  FOR PUBLIC
   42  INSPECTION AND COPYING OF ITS INFORMATION AND OFFICIAL  RECORDS,  EXCEPT
   43  SUCH  INFORMATION  AND  RECORDS INVOLVING THE PRIVACY OF INDIVIDUALS AND
   44  INSURERS' TRADE SECRETS. THE COMMISSION MAY PROMULGATE ADDITIONAL  RULES
   45  UNDER WHICH IT MAY MAKE AVAILABLE TO FEDERAL AND STATE AGENCIES, INCLUD-
   46  ING  LAW  ENFORCEMENT AGENCIES, RECORDS AND INFORMATION OTHERWISE EXEMPT
   47  FROM DISCLOSURE, AND MAY ENTER INTO AGREEMENTS  WITH  SUCH  AGENCIES  TO
   48  RECEIVE  OR EXCHANGE INFORMATION OR RECORDS SUBJECT TO NONDISCLOSURE AND
   49  CONFIDENTIALITY PROVISIONS.
   50    (B) EXCEPT AS TO PRIVILEGED RECORDS, DATA AND INFORMATION, THE LAWS OF
   51  ANY COMPACTING STATE  PERTAINING  TO  CONFIDENTIALITY  OR  NONDISCLOSURE
   52  SHALL  NOT  RELIEVE  ANY  COMPACTING  STATE  COMMISSIONER OF THE DUTY TO
   53  DISCLOSE ANY RELEVANT RECORDS, DATA OR INFORMATION  TO  THE  COMMISSION;
   54  PROVIDED  HOWEVER, THAT DISCLOSURE TO THE COMMISSION SHALL NOT BE DEEMED
   55  TO WAIVE  OR  OTHERWISE  AFFECT  ANY  CONFIDENTIALITY  REQUIREMENT;  AND
   56  PROVIDED  FURTHER  THAT,  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS
       S. 3287                            11
    1  ARTICLE, THE COMMISSION SHALL NOT BE SUBJECT TO THE LAWS OF ANY COMPACT-
    2  ING STATE PERTAINING TO CONFIDENTIALITY AND NONDISCLOSURE  WITH  RESPECT
    3  TO  RECORDS, DATA AND INFORMATION IN ITS POSSESSION. CONFIDENTIAL INFOR-
    4  MATION  OF  THE COMMISSION SHALL REMAIN CONFIDENTIAL AFTER SUCH INFORMA-
    5  TION IS PROVIDED TO ANY COMMISSIONER.
    6    (C) THE COMMISSION SHALL MONITOR COMPACTING STATES FOR COMPLIANCE WITH
    7  DULY ADOPTED BY-LAWS, RULES, INCLUDING UNIFORM STANDARDS, AND  OPERATING
    8  PROCEDURES.  THE  COMMISSION  SHALL  NOTIFY SUCH NONCOMPLYING COMPACTING
    9  STATE IN WRITING OF ITS NONCOMPLIANCE WITH COMMISSION BY-LAWS, RULES  OR
   10  OPERATING  PROCEDURES.  IF  THE  NONCOMPLYING  COMPACTING STATE FAILS TO
   11  REMEDY SUCH NONCOMPLIANCE WITHIN THE TIME SPECIFIED  IN  THE  NOTICE  OF
   12  NONCOMPLIANCE,  THE COMPACTING STATE SHALL BE DEEMED TO BE IN DEFAULT AS
   13  SET FORTH IN SECTION EIGHT THOUSAND TWO HUNDRED FIFTEEN OF THIS ARTICLE.
   14    (D) THE COMMISSIONER OF ANY STATE IN WHICH AN INSURER IS AUTHORIZED TO
   15  DO BUSINESS, OR IS CONDUCTING THE BUSINESS OF INSURANCE, SHALL  CONTINUE
   16  TO EXERCISE HIS OR HER AUTHORITY TO OVERSEE THE MARKET REGULATION OF THE
   17  ACTIVITIES  OF  THE  INSURER  IN  ACCORDANCE  WITH THE PROVISIONS OF THE
   18  STATE'S LAW. THE  COMMISSIONER'S  ENFORCEMENT  OF  COMPLIANCE  WITH  THE
   19  COMPACT IS GOVERNED BY THE FOLLOWING PROVISIONS:
   20    (1)  WITH RESPECT TO THE COMMISSIONER'S MARKET REGULATION OF A PRODUCT
   21  OR ADVERTISEMENT THAT IS APPROVED OR CERTIFIED BY  THE  COMMISSION,  THE
   22  CONTENT OF THE PRODUCT OR ADVERTISEMENT SHALL NOT CONSTITUTE A VIOLATION
   23  OF  THE PROVISIONS, STANDARDS OR REQUIREMENTS OF THE COMPACT EXCEPT UPON
   24  A FINAL ORDER OF THE COMMISSION, ISSUED AT THE REQUEST OF A COMMISSIONER
   25  AFTER PRIOR NOTICE TO THE INSURER AND AN OPPORTUNITY FOR HEARING  BEFORE
   26  THE COMMISSION.
   27    (2)  BEFORE  A  COMMISSIONER  MAY BRING AN ACTION FOR VIOLATION OF ANY
   28  PROVISION, STANDARD OR  REQUIREMENT  OF  THE  COMPACT  RELATING  TO  THE
   29  CONTENT OF AN ADVERTISEMENT NOT APPROVED OR CERTIFIED BY THE COMMISSION,
   30  THE  COMMISSION  OR  AN  AUTHORIZED COMMISSION OFFICER OR EMPLOYEE, MUST
   31  AUTHORIZE THE ACTION. HOWEVER, AUTHORIZATION PURSUANT TO THIS  PARAGRAPH
   32  DOES  NOT  REQUIRE  NOTICE  TO  THE  INSURER, OPPORTUNITY FOR HEARING OR
   33  DISCLOSURE OF REQUESTS FOR AUTHORIZATION OR RECORDS OF THE  COMMISSION'S
   34  ACTION ON SUCH REQUESTS.
   35    S  8210.  DISPUTE  RESOLUTION.  THE COMMISSION SHALL ATTEMPT, UPON THE
   36  REQUEST OF A MEMBER, TO RESOLVE ANY DISPUTES OR OTHER  ISSUES  THAT  ARE
   37  SUBJECT TO THIS COMPACT AND WHICH MAY ARISE BETWEEN TWO OR MORE COMPACT-
   38  ING  STATES, OR BETWEEN COMPACTING STATES AND NON-COMPACTING STATES, AND
   39  THE COMMISSION SHALL PROMULGATE AN  OPERATING  PROCEDURE  PROVIDING  FOR
   40  RESOLUTION OF SUCH DISPUTES.
   41    S  8211.  PRODUCT  FILING  AND  APPROVAL. (A) INSURERS AND THIRD-PARTY
   42  FILERS SEEKING TO HAVE A PRODUCT APPROVED BY THE COMMISSION  SHALL  FILE
   43  SUCH  PRODUCT  WITH,  AND PAY APPLICABLE FILING FEES TO, THE COMMISSION.
   44  NOTHING IN THIS ARTICLE SHALL BE  CONSTRUED  TO  RESTRICT  OR  OTHERWISE
   45  PREVENT AN INSURER FROM FILING ITS PRODUCT WITH THE INSURANCE DEPARTMENT
   46  IN ANY STATE WHEREIN SUCH INSURER IS LICENSED TO CONDUCT THE BUSINESS OF
   47  INSURANCE,  AND  SUCH  FILING SHALL BE SUBJECT TO THE LAWS OF THE STATES
   48  WHERE FILED.
   49    (B) THE COMMISSION SHALL ESTABLISH APPROPRIATE FILING AND REVIEW PROC-
   50  ESSES AND PROCEDURES PURSUANT TO COMMISSION RULES AND  OPERATING  PROCE-
   51  DURES.  NOTWITHSTANDING  ANY  PROVISION IN THIS SECTION TO THE CONTRARY,
   52  THE COMMISSION SHALL PROMULGATE RULES TO ESTABLISH CONDITIONS AND PROCE-
   53  DURES UNDER WHICH THE COMMISSION WILL PROVIDE PUBLIC ACCESS  TO  PRODUCT
   54  FILING  INFORMATION.  IN  ESTABLISHING  SUCH RULES, THE COMMISSION SHALL
   55  CONSIDER THE INTERESTS OF THE PUBLIC IN HAVING ACCESS TO  SUCH  INFORMA-
   56  TION,  AS  WELL AS PROTECTION OF PERSONAL MEDICAL AND FINANCIAL INFORMA-
       S. 3287                            12
    1  TION AND TRADE SECRETS, THAT MAY BE CONTAINED IN  A  PRODUCT  FILING  OR
    2  SUPPORTING INFORMATION.
    3    (C)  ANY  PRODUCT  APPROVED BY THE COMMISSION MAY BE SOLD OR OTHERWISE
    4  ISSUED IN THOSE COMPACTING  STATES  IN  WHICH  THE  INSURER  IS  LEGALLY
    5  AUTHORIZED TO DO BUSINESS.
    6    S  8212.  REVIEW  OF  COMMISSION  DECISIONS REGARDING FILINGS. (A) NOT
    7  LATER THAN THIRTY DAYS AFTER THE COMMISSION HAS GIVEN NOTICE OF A DISAP-
    8  PROVED PRODUCT OR ADVERTISEMENT FILED WITH THE COMMISSION,  THE  INSURER
    9  OR  THIRD PARTY FILER WHOSE FILING WAS DISAPPROVED MAY APPEAL THE DETER-
   10  MINATION TO A REVIEW PANEL APPOINTED BY THE COMMISSION.  THE  COMMISSION
   11  SHALL  PROMULGATE  RULES  TO  ESTABLISH  PROCEDURES  FOR APPOINTING SUCH
   12  REVIEW PANEL AND PROVIDE FOR NOTICE AND HEARING. AN ALLEGATION THAT  THE
   13  COMMISSION,  IN  DISAPPROVING  A PRODUCT OR ADVERTISEMENT FILED WITH THE
   14  COMMISSION, ACTED ARBITRARILY, CAPRICIOUSLY OR IN A MANNER  THAT  IS  AN
   15  ABUSE  OF DISCRETION OR OTHERWISE NOT IN ACCORDANCE WITH LAW, IS SUBJECT
   16  TO JUDICIAL REVIEW IN ACCORDANCE WITH SUBSECTION (E)  OF  SECTION  EIGHT
   17  THOUSAND TWO HUNDRED FOUR OF THIS ARTICLE.
   18    (B)  THE COMMISSION SHALL HAVE AUTHORITY TO MONITOR, REVIEW AND RECON-
   19  SIDER PRODUCTS AND ADVERTISEMENT SUBSEQUENT TO THEIR FILING OR  APPROVAL
   20  UPON A FINDING THAT THE PRODUCT DOES NOT MEET THE RELEVANT UNIFORM STAN-
   21  DARD.  WHERE  APPROPRIATE,  THE  COMMISSION  MAY  WITHDRAW OR MODIFY ITS
   22  APPROVAL AFTER PROPER NOTICE AND HEARING, SUBJECT TO THE APPEAL  PROCESS
   23  SET FORTH IN SUBSECTION (A) OF THIS SECTION.
   24    S  8213.  FINANCE.  (A)  THE  COMMISSION  SHALL PAY OR PROVIDE FOR THE
   25  PAYMENT OF THE REASONABLE EXPENSES OF ITS  ESTABLISHMENT  AND  ORGANIZA-
   26  TION.  TO  FUND  THE  COST OF ITS INITIAL OPERATIONS, THE COMMISSION MAY
   27  ACCEPT CONTRIBUTIONS AND OTHER FORMS OF FUNDING FROM THE NAIC,  COMPACT-
   28  ING  STATES  AND OTHER SOURCES. CONTRIBUTIONS AND OTHER FORMS OF FUNDING
   29  FROM OTHER SOURCES SHALL BE OF SUCH A NATURE THAT  THE  INDEPENDENCE  OF
   30  THE  COMMISSION  CONCERNING  THE  PERFORMANCE OF ITS DUTIES SHALL NOT BE
   31  COMPROMISED.
   32    (B) THE COMMISSION SHALL COLLECT A FILING FEE FROM  EACH  INSURER  AND
   33  THIRD PARTY FILER FILING A PRODUCT WITH THE COMMISSION TO COVER THE COST
   34  OF  THE  OPERATIONS  AND ACTIVITIES OF THE COMMISSION AND ITS STAFF IN A
   35  TOTAL AMOUNT SUFFICIENT TO COVER THE COMMISSION'S ANNUAL BUDGET.
   36    (C) THE COMMISSION'S BUDGET FOR A FISCAL YEAR SHALL  NOT  BE  APPROVED
   37  UNTIL  IT HAS BEEN SUBJECT TO NOTICE AND COMMENT AS SET FORTH IN SECTION
   38  EIGHT THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE.
   39    (D) THE COMMISSION SHALL BE EXEMPT FROM ALL TAXATION  IN  AND  BY  THE
   40  COMPACTING STATES.
   41    (E)  THE  COMMISSION  SHALL  NOT  PLEDGE  THE CREDIT OF ANY COMPACTING
   42  STATE, EXCEPT BY AND  WITH  THE  APPROPRIATE  LEGAL  AUTHORITY  OF  THAT
   43  COMPACTING STATE.
   44    (F)  THE  COMMISSION  SHALL KEEP COMPLETE AND ACCURATE ACCOUNTS OF ALL
   45  ITS INTERNAL RECEIPTS, INCLUDING GRANTS AND DONATIONS AND  DISBURSEMENTS
   46  OF  ALL  FUNDS UNDER ITS CONTROL. THE INTERNAL FINANCIAL ACCOUNTS OF THE
   47  COMMISSION SHALL BE SUBJECT TO  THE  ACCOUNTING  PROCEDURES  ESTABLISHED
   48  UNDER  ITS  BY-LAWS.  THE  FINANCIAL  ACCOUNTS AND REPORTS INCLUDING THE
   49  SYSTEM OF INTERNAL CONTROLS AND PROCEDURES OF THE  COMMISSION  SHALL  BE
   50  AUDITED ANNUALLY BY AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT. UPON THE
   51  DETERMINATION OF THE COMMISSION, BUT NO LESS FREQUENTLY THAN EVERY THREE
   52  YEARS, THE REVIEW OF SUCH INDEPENDENT AUDITOR SHALL INCLUDE A MANAGEMENT
   53  AND  PERFORMANCE  AUDIT  OF THE COMMISSION. THE COMMISSION SHALL MAKE AN
   54  ANNUAL REPORT TO THE GOVERNOR AND LEGISLATURE OF THE COMPACTING  STATES,
   55  WHICH SHALL INCLUDE A REPORT OF SUCH INDEPENDENT AUDIT. THE COMMISSION'S
   56  INTERNAL  ACCOUNTS  SHALL  NOT BE CONFIDENTIAL AND SUCH MATERIALS MAY BE
       S. 3287                            13
    1  SHARED WITH THE COMMISSIONER  OF  ANY  COMPACTING  STATE  UPON  REQUEST,
    2  PROVIDED, HOWEVER, THAT ANY WORK PAPERS RELATED TO ANY INTERNAL OR INDE-
    3  PENDENT  AUDIT  AND ANY INFORMATION REGARDING THE PRIVACY OF INDIVIDUALS
    4  AND  INSURERS'  PROPRIETARY  INFORMATION, INCLUDING TRADE SECRETS, SHALL
    5  REMAIN CONFIDENTIAL.
    6    (G) NO COMPACTING STATE SHALL HAVE ANY CLAIM TO OR  OWNERSHIP  OF  ANY
    7  PROPERTY  HELD BY OR VESTED IN THE COMMISSION OR TO ANY COMMISSION FUNDS
    8  HELD PURSUANT TO THE PROVISIONS OF THIS COMPACT.
    9    S 8214. COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT. (A) ANY STATE
   10  IS ELIGIBLE TO BECOME A COMPACTING STATE.
   11    (B) THE COMPACT SHALL BECOME EFFECTIVE AND  BINDING  UPON  LEGISLATIVE
   12  ENACTMENT  OF  THE  COMPACT  INTO LAW BY TWO COMPACTING STATES; PROVIDED
   13  HOWEVER, THAT THE COMMISSION SHALL  BECOME  EFFECTIVE  FOR  PURPOSES  OF
   14  ADOPTING  UNIFORM STANDARDS FOR REVIEWING, AND GIVING APPROVAL OR DISAP-
   15  PROVAL OF, PRODUCTS FILED WITH THE COMMISSION  THAT  SATISFY  APPLICABLE
   16  UNIFORM STANDARDS ONLY AFTER TWENTY-SIX STATES ARE COMPACTING STATES OR,
   17  ALTERNATIVELY,  BY STATES REPRESENTING GREATER THAN FORTY PERCENT OF THE
   18  PREMIUM VOLUME FOR LIFE INSURANCE, ANNUITY, DISABILITY INCOME AND  LONG-
   19  TERM CARE INSURANCE PRODUCTS, BASED ON RECORDS OF THE NAIC FOR THE PRIOR
   20  YEAR.  THEREAFTER, IT SHALL BECOME EFFECTIVE AND BINDING AS TO ANY OTHER
   21  COMPACTING STATE UPON ENACTMENT OF THE COMPACT INTO LAW BY THAT STATE.
   22    (C) AMENDMENTS TO THE COMPACT MAY BE PROPOSED BY  THE  COMMISSION  FOR
   23  ENACTMENT  BY THE COMPACTING STATES. NO AMENDMENT SHALL BECOME EFFECTIVE
   24  AND BINDING UPON THE COMMISSION AND THE  COMPACTING  STATES  UNLESS  AND
   25  UNTIL ALL COMPACTING STATES ENACT THE AMENDMENT INTO LAW.
   26    S  8215.  WITHDRAWAL,  DEFAULT AND TERMINATION. (A)(1) ONCE EFFECTIVE,
   27  THE COMPACT SHALL CONTINUE IN FORCE AND REMAIN  BINDING  UPON  EACH  AND
   28  EVERY  COMPACTING  STATE;  PROVIDED THAT A COMPACTING STATE MAY WITHDRAW
   29  FROM THE COMPACT ("WITHDRAWING STATE") BY  ENACTING  A  STATUTE  SPECIF-
   30  ICALLY REPEALING THE STATUTE WHICH ENACTED THE COMPACT INTO LAW.
   31    (2)  THE  EFFECTIVE  DATE  OF  WITHDRAWAL IS THE EFFECTIVE DATE OF THE
   32  REPEALING STATUTE.  HOWEVER, THE WITHDRAWAL SHALL NOT APPLY TO ANY PROD-
   33  UCT FILINGS APPROVED OR SELF-CERTIFIED, OR  ANY  ADVERTISEMENT  OF  SUCH
   34  PRODUCTS, ON THE DATE THE REPEALING STATUTE BECOMES EFFECTIVE, EXCEPT BY
   35  MUTUAL  AGREEMENT OF THE COMMISSION AND THE WITHDRAWING STATE UNLESS THE
   36  APPROVAL IS RESCINDED BY THE WITHDRAWING STATE AS PROVIDED IN  PARAGRAPH
   37  FIVE OF THIS SUBSECTION.
   38    (3) THE COMMISSIONER OF THE WITHDRAWING STATE SHALL IMMEDIATELY NOTIFY
   39  THE MANAGEMENT COMMITTEE IN WRITING UPON THE INTRODUCTION OF LEGISLATION
   40  REPEALING THIS COMPACT IN THE WITHDRAWING STATE.
   41    (4)  THE  COMMISSION  SHALL  NOTIFY THE OTHER COMPACTING STATES OF THE
   42  INTRODUCTION OF SUCH LEGISLATION WITHIN TEN DAYS AFTER  ITS  RECEIPT  OF
   43  NOTICE THEREOF.
   44    (5)  THE  WITHDRAWING STATE IS RESPONSIBLE FOR ALL OBLIGATIONS, DUTIES
   45  AND LIABILITIES INCURRED  THROUGH  THE  EFFECTIVE  DATE  OF  WITHDRAWAL,
   46  INCLUDING  ANY  OBLIGATIONS,  THE PERFORMANCE OF WHICH EXTEND BEYOND THE
   47  EFFECTIVE DATE OF WITHDRAWAL, EXCEPT TO THE EXTENT THOSE OBLIGATIONS MAY
   48  HAVE BEEN RELEASED OR RELINQUISHED BY MUTUAL AGREEMENT OF THE COMMISSION
   49  AND THE WITHDRAWING STATE. THE COMMISSION'S  APPROVAL  OF  PRODUCTS  AND
   50  ADVERTISEMENT  PRIOR  TO THE EFFECTIVE DATE OF WITHDRAWAL SHALL CONTINUE
   51  TO BE EFFECTIVE AND BE GIVEN FULL FORCE AND EFFECT  IN  THE  WITHDRAWING
   52  STATE,  UNLESS  FORMALLY  RESCINDED BY THE WITHDRAWING STATE IN THE SAME
   53  MANNER AS PROVIDED BY THE LAWS OF THE WITHDRAWING STATE FOR THE PROSPEC-
   54  TIVE DISAPPROVAL OF PRODUCTS OR ADVERTISEMENT PREVIOUSLY APPROVED  UNDER
   55  STATE LAW.
       S. 3287                            14
    1    (6)  REINSTATEMENT  FOLLOWING WITHDRAWAL OF ANY COMPACTING STATE SHALL
    2  OCCUR UPON THE EFFECTIVE DATE OF  THE  WITHDRAWING  STATE'S  LEGISLATION
    3  REENACTING THE COMPACT.
    4    (B)  (1) IF THE COMMISSION DETERMINES THAT ANY COMPACTING STATE HAS AT
    5  ANY TIME DEFAULTED ("DEFAULTING STATE") IN THE PERFORMANCE OF ANY OF ITS
    6  OBLIGATIONS OR RESPONSIBILITIES UNDER THIS COMPACT, THE BY-LAWS OR  DULY
    7  PROMULGATED  RULES OR OPERATING PROCEDURES, THEN, AFTER NOTICE AND HEAR-
    8  ING AS SET FORTH IN THE BY-LAWS, ALL  RIGHTS,  PRIVILEGES  AND  BENEFITS
    9  CONFERRED BY THE COMPACT ON THE DEFAULTING STATE SHALL BE SUSPENDED FROM
   10  THE  EFFECTIVE  DATE  OF DEFAULT AS FIXED BY THE COMMISSION. THE GROUNDS
   11  FOR DEFAULT INCLUDE, BUT ARE NOT LIMITED TO,  FAILURE  OF  A  COMPACTING
   12  STATE  TO  PERFORM  ITS  OBLIGATIONS  OR RESPONSIBILITIES, AND ANY OTHER
   13  GROUNDS DESIGNATED IN COMMISSION RULES. THE COMMISSION SHALL IMMEDIATELY
   14  NOTIFY THE DEFAULTING STATE IN WRITING OF THE DEFAULTING STATE'S SUSPEN-
   15  SION PENDING A CURE OF THE DEFAULT. THE COMMISSION SHALL  STIPULATE  THE
   16  CONDITIONS  AND  THE  TIME PERIOD WITHIN WHICH THE DEFAULTING STATE MUST
   17  CURE ITS DEFAULT. IF THE DEFAULTING STATE  FAILS  TO  CURE  THE  DEFAULT
   18  WITHIN THE TIME PERIOD SPECIFIED BY THE COMMISSION, THE DEFAULTING STATE
   19  SHALL  BE  TERMINATED  FROM  THE  COMPACT AND ALL RIGHTS, PRIVILEGES AND
   20  BENEFITS CONFERRED BY THE COMPACT SHALL BE TERMINATED FROM THE EFFECTIVE
   21  DATE OF TERMINATION.
   22    (2) PRODUCT APPROVALS BY THE  COMMISSION  OR  PRODUCT  SELF-CERTIFICA-
   23  TIONS, OR ANY ADVERTISEMENT IN CONNECTION WITH SUCH PRODUCT, THAT ARE IN
   24  FORCE  ON THE EFFECTIVE DATE OF TERMINATION SHALL REMAIN IN FORCE IN THE
   25  DEFAULTING STATE IN THE SAME MANNER AS IF THE DEFAULTING STATE HAD WITH-
   26  DRAWN VOLUNTARILY UNDER THIS SECTION.
   27    (3)  REINSTATEMENT  FOLLOWING  TERMINATION  OF  ANY  COMPACTING  STATE
   28  REQUIRES A REENACTMENT OF THE COMPACT BY THAT STATE.
   29    (C)(1) THE COMPACT DISSOLVES EFFECTIVE UPON THE DATE OF THE WITHDRAWAL
   30  OR  DEFAULT  OF  THE  COMPACTING  STATE  WHICH REDUCES MEMBERSHIP IN THE
   31  COMPACT TO ONE COMPACTING STATE.
   32    (2) UPON THE DISSOLUTION OF THE COMPACT, THE COMPACT BECOMES NULL  AND
   33  VOID  AND  SHALL  BE OF NO FURTHER FORCE OR EFFECT, AND THE BUSINESS AND
   34  AFFAIRS OF THE COMMISSION SHALL BE WOUND UP AND ANY SURPLUS FUNDS  SHALL
   35  BE DISTRIBUTED IN ACCORDANCE WITH THE BY-LAWS.
   36    S  8216.  SEVERABILITY  AND  CONSTRUCTION.  (A)  THE PROVISIONS OF THE
   37  COMPACT SHALL BE SEVERABLE; AND  IF  ANY  PHRASE,  CLAUSE,  SENTENCE  OR
   38  PROVISION  IS  DEEMED  UNENFORCEABLE,  THE  REMAINING  PROVISIONS OF THE
   39  COMPACT SHALL BE ENFORCEABLE.
   40    (B) THE PROVISIONS OF THE COMPACT  SHALL  BE  LIBERALLY  CONSTRUED  TO
   41  EFFECTUATE ITS PURPOSES.
   42    S  8217. BINDING EFFECT OF COMPACT AND OTHER LAWS. (A) NOTHING IN THIS
   43  SECTION PREVENTS THE ENFORCEMENT OF ANY OTHER LAW OF A COMPACTING STATE,
   44  EXCEPT AS PROVIDED IN SUBSECTION (B) OF THIS SECTION.
   45    (B) FOR ANY PRODUCT APPROVED  OR  CERTIFIED  TO  THE  COMMISSION,  THE
   46  RULES,  UNIFORM  STANDARDS  AND ANY OTHER REQUIREMENTS OF THE COMMISSION
   47  SHALL CONSTITUTE THE EXCLUSIVE PROVISIONS  APPLICABLE  TO  THE  CONTENT,
   48  APPROVAL  AND  CERTIFICATION OF SUCH PRODUCTS. FOR ADVERTISEMENT THAT IS
   49  SUBJECT TO THE COMMISSION'S AUTHORITY, ANY  RULE,  UNIFORM  STANDARD  OR
   50  OTHER  REQUIREMENT  OF  THE  COMMISSION WHICH GOVERNS THE CONTENT OF THE
   51  ADVERTISEMENT SHALL CONSTITUTE THE EXCLUSIVE PROVISION  THAT  A  COMMIS-
   52  SIONER  MAY  APPLY  TO THE CONTENT OF THE ADVERTISEMENT. NOTWITHSTANDING
   53  THE FOREGOING, NO ACTION TAKEN  BY  THE  COMMISSION  SHALL  ABROGATE  OR
   54  RESTRICT:
   55    (1) THE ACCESS OF ANY PERSON TO STATE COURTS;
       S. 3287                            15
    1    (2)  REMEDIES AVAILABLE UNDER STATE LAW RELATED TO BREACH OF CONTRACT,
    2  TORT OR OTHER LAWS NOT SPECIFICALLY DIRECTED TO THE CONTENT OF THE PROD-
    3  UCT;
    4    (3) STATE LAW RELATING TO THE CONSTRUCTION OF INSURANCE CONTRACTS; OR
    5    (4)  THE AUTHORITY OF THE ATTORNEY GENERAL OF THE STATE INCLUDING, BUT
    6  NOT LIMITED TO, MAINTAINING ANY ACTIONS OR PROCEEDINGS AS AUTHORIZED  BY
    7  LAW.
    8    (C)  ALL  INSURANCE  PRODUCTS  FILED  WITH  INDIVIDUAL STATES SHALL BE
    9  SUBJECT TO THE LAWS OF THOSE STATES.
   10    (D) ALL LAWFUL ACTIONS OF THE  COMMISSION,  INCLUDING  ALL  RULES  AND
   11  OPERATING PROCEDURES PROMULGATED BY THE COMMISSION, ARE BINDING UPON THE
   12  COMPACTING STATES.
   13    (E)  ALL  AGREEMENTS  BETWEEN THE COMMISSION AND THE COMPACTING STATES
   14  ARE BINDING IN ACCORDANCE WITH THEIR TERMS.
   15    (F) UPON THE REQUEST OF A PARTY TO A  CONFLICT  OVER  THE  MEANING  OR
   16  INTERPRETATION  OF  COMMISSION  ACTIONS, AND UPON A MAJORITY VOTE OF THE
   17  COMPACTING STATES, THE COMMISSION MAY ISSUE ADVISORY OPINIONS  REGARDING
   18  THE DISPUTED MEANING OR INTERPRETATION.
   19    (G)  IN  THE EVENT ANY PROVISION OF THIS ARTICLE EXCEEDS THE CONSTITU-
   20  TIONAL LIMITS IMPOSED ON THE LEGISLATURE OF ANY  COMPACTING  STATE,  THE
   21  OBLIGATIONS,  DUTIES,  POWERS  OR JURISDICTION SOUGHT TO BE CONFERRED BY
   22  THAT PROVISION UPON THE COMMISSION  SHALL  BE  INEFFECTIVE  AS  TO  SUCH
   23  COMPACTING  STATE,  AND SUCH OBLIGATIONS, DUTIES, POWERS OR JURISDICTION
   24  SHALL REMAIN IN THE COMPACTING STATE AND SHALL BE EXERCISED BY THE AGEN-
   25  CY THEREOF TO WHICH SUCH OBLIGATIONS, DUTIES, POWERS OR JURISDICTION ARE
   26  DELEGATED BY LAW IN EFFECT AT THE TIME THE COMPACT BECOMES EFFECTIVE.
   27    S 3. This act shall take effect on the one hundred eightieth day after
   28  it shall have become a law.