PROPOSED ORDER OF THE OFFICE OF THE COMMISSIONER OF INSURANCE AMENDING, CREATING AND REPEALING A RULE
Office of the Commissioner of Insurance
The Commissioner of Insurance proposes an order to amend Ins 51.01 (21) to fix a citation error. The order would also amend and create new provisions in Ins 51.80 (3)(a) to change the compulsory surplus requirements for Medicare stand-alone products, variable life insurance policies and medical malpractice policies. The order would also create a new section related to premium for health insurers for purposes of Wis. Admin. Code § 51.80.
The statement of scope for this rule SS: 160-20 was approved by the Governor on December 11, 2020, published in Register No.780A3, on December 21, 2020, and approved by the Commissioner on January 13, 2021.
ANALYSIS PREPARED BY THE OFFICE OF THE COMMISSIONER OF INSURANCE (OCI)
1. Statutes interpreted:
2. Statutory authority:
3. Explanation of OCI’s authority to promulgate the proposed rule under these statutes:
The Commissioner has the general authority to promulgate rules necessary to administer and enforce Wis. Stats. chs. 600 to 655, and as provided in Wis. Stats. § 601.41 (3) (a)., grants the Commissioner “rule-making authority” under Wis. Stat. § 227.11 (2) (a). Wisconsin statute § 623.11 (2), requires the Commissioner to establish by rule the minimum ratios for the compulsory surplus in relation to any relevant variables including amounts at risk, premiums written or earned, liabilities and equity investments. 4. Related statutes or rules:
Wis. Adm. Code Ins ch 51, Wisconsin Statutes Section 623.11. 5. The plain language analysis and summary of the proposed rule:
The proposed rule will modify the compulsory surplus requirement for insurers offering Medicare stand-alone drug coverage, variable life insurance, and medical malpractice insurance to be reflective of the risk and amount of compulsory surplus required to be maintained. Additionally, the proposed rule will add provisions regarding premium for health insurers for purposes of Wis. Admin. Code § 51.80 and correct a citation cross reference in Wis. Admin. Code § 51.01. 6. Summary of, and preliminary comparison with, any existing or proposed federal regulation that is intended to address the activities to be regulated by the proposed rule:
NA
7. Comparison of similar rules in adjacent states as found by OCI:
Illinois: 215 ILL. COMP. STAT. 5/35A-1 to 5/35A-70
Iowa: IOWA CODE §§ 521E.1 to 521E.12
Michigan: BULLETIN 2013-21-INS
Minnesota: MINN. STAT. §§ 60A.60 to 60A.696
8. A summary of the factual data and analytical methodologies that OCI used in support of the proposed rule and how any related findings support the regulatory approach chosen for the proposed rule:
OCI has issued orders to insurers who offer stand-alone Medicare, variable life and medical malpractice polices in which the agency provided more refined approaches to compulsory surplus requirements in line with the proposed changes in this rule. The intent of the rule is to adopt the factors that OCI has currently been modifying through specific company orders as industry-wide standards for simplicity and uniformity.
9. Any analysis and supporting documentation that OCI used in support of OCI’s determination of the rule’s effect on small businesses under s. 227.114: The proposed rule would modify surplus requirements for stand-alone Medicare, variable life insurance, and medical malpractice insurance products. OCI is not aware of any insurers that issue these type of products that would be considered a small business.
10. A description of the Effect on Small Business:
This rule will have little or no effect on small businesses.
11. Agency contact person:
Phone: (608) 267-9586
Address: 125 South Webster St – 2nd Floor, Madison WI 53703-3474
Mail: PO Box 7873, Madison, WI 53707-7873
12. Place where comments are to be submitted and deadline for submission:
Persons wishing to testify or provide oral or written comments regarding the proposed administrative rule may appear during the hearing. Additionally, the rule may be reviewed and comments made at https://docs.legis.wisconsin.gov/code or sent to the following: The deadline for submitting comments is 4:00 p.m. on December 2, 2022.
Written comments can be mailed or hand-delivered to:
Legal Unit - OCI Rule Comment for Rule Ins 51
Office of the Commissioner of Insurance
125 South Webster St – 2nd Floor
