Iowa:
Iowa does not have a program similar to Family Care.
Michigan:
Michigan does not have a program similar to Family Care.
Minnesota:
Minnesota does not have a program similar to Family Care.
Summary of factual data and analytical methodologies
The Department assessed the adverse impact on individuals affected by previous changes in benefits as a result of changes in state statute and federal policy.
Small Business Impact
The rules would not have an effect on businesses.
Small business regulatory coordinator
Rosie Greer
608-266-1279
Fiscal Estimate
The proposed rule will have no immediate fiscal impact, but may result in an indeterminate decrease in future costs to the state and to Family Care managed care organizations (MCOs). Some MCOs are units of county government. Some MCOs are private non-profit organizations, which are not small businesses. The potential future decrease in costs to the state and to MCOs will result from not being required to assign staff to conduct or participate in fair hearings in which the appellant cannot be successful. In addition, MCOs may have decreased costs because they will not be required to continue to provide services during an appeal in which the appellant cannot be successful.
Copies of Rules and Fiscal Estimate
A copy of the full text of the rules and the fiscal estimate can be obtained at no charge from the Wisconsin Admin. Rules Website at
http://adminrules.wisconsin.gov or by contacting the person listed below.
Agency Contact Person
Charles Jones
Division of Long Term Care
1 W. Wilson St., Room 518
P.O. Box 7851
Madison, WI 53707-7851
Phone: (608) 266-0991
TTY: (888) 241-9432
Notice of Hearing
Insurance
NOTICE IS HEREBY GIVEN That pursuant to the authority granted under s.
601.41 (3), Stats., and the procedures set forth under s.
227.18, Stats., the Office of the Commissioner of Insurance (OCI) will hold a public hearing to consider the adoption of rules revising section
Ins 2.81, Wis. Adm. Code, relating to use of the 1980 CSO Standard Ordinary Life Valuation Mortality Table in determining the minimum standard of valuation reserves and the minimum standard nonforfeiture values for preneed funeral life insurance products.
Hearing Information
Date: May 7, 2009
Time: 10:00 a.m., or as soon thereafter as
the matter may be reached
Place: OCI, Room 227, 2nd Floor
125 South Webster Street
Madison, WI
Submission of Written Comments
Written comments can be mailed to:
James W. Harris
Legal Unit - OCI Rule Comment for Rule Ins 281
Office of the Commissioner of Insurance
PO Box 7873
Madison WI 53707-7873
Written comments can be hand delivered to:
James W. Harris
Legal Unit - OCI Rule Comment for Rule Ins 281
Office of the Commissioner of Insurance
125 South Webster St – 2nd Floor
Madison WI 53703-3474
Comments can be emailed to:
James W. Harris
The deadline for submitting comments is 4:00 p.m. on the 14th day after the date for the hearing stated in this Notice of Hearing.
Analysis Prepared by the Office of the Commissioner of Insurance (OCI)
Statutes interpreted
Statutory authority
Explanation of agency authority
The proposed rule is promulgated under the commissioner's authority to prescribe valuation and reserve liabilities and accounting standards and reporting for insurers.
Related statutes or rules
The proposed rule relates to existing rules prescribing valuation of liabilities, nonforfeiture values, and actuarial reporting and analysis under ss.
601.42,
623.06 and
632.43, Stats., and ss.
Ins 2.80 and ch.
Ins 50, Wis. Adm. Code.
Plain language analysis
Section
Ins 2.81, Wis. Adm. Code, sets forth the requirements for use of the 2001 commissioners standard ordinary (CSO) mortality table by insurers, meeting prescribed conditions, in determining minimum reserve liabilities and minimum nonforfeiture values, which may be used for policies issued on or after January 1, 2005, and before January 1, 2009, and which shall be used for policies issued on or after January 1, 2009. Research completed by the Deloitte University of Connecticut Actuarial Center commissioned by the Society of Actuaries as a part of a study of preneed mortality, determined that the 2001 CSO Mortality Table produces inadequate reserves for policies issued to fund funeral services and expenses. The proposed rule provides that for determining the minimum mortality standard for determining reserve liabilities and nonforfeiture values for funeral policies as defined in s.
632.415, Stats., insurers shall use the 1980 commissioners standard ordinary (CSO) mortality table. Insurers may elect to use the 2001 CSO mortality table for funeral policies issued on or after January 1, 2009, and before January 1, 2012, provided the insurer certifies to the commissioner with supporting information that the reserve methodology employed by the insurer using the 2001 CSO mortality table as a minimum standard develops adequate reserves.
Comparison with federal regulations
There are no federal regulations which address use of mortality tables to establish reserve liabilities and nonforfeiture values for insurers doing business in Wisconsin.
Comparison of rules in adjacent states
Illinois:
Ill. Ch.
215 ILCS 5/223, ff., permits use of the 1980 CSO Standard Ordinary Life Valuation Mortality Table, with apparent permissive authority to use later tables adopted by the NAIC. The regulation does not differentiate for funeral policies.
Iowa:
Iowa Adm. Code 191-94.3, permits the use for purposes of reserve valuation, under prescribed conditions, of the 2001 CSO Preferred Class Structure Mortality Table. The regulation does not differentiate for funeral policies.
Michigan:
Mich. Comp. Laws, s.
500.838a, permits the use for purposes of reserve valuation, under prescribed conditions, of the 2001 CSO Preferred Class Structure Mortality Table. The regulation does not differentiate for funeral policies.
Minnesota:
Minn. Stat. Ch. 61A.257, permits the use for purposes of reserve valuation, under prescribed conditions, of the 2001 CSO Preferred Class Structure Mortality Table. The regulation does not differentiate for funeral policies.
Summary of factual data and analytical methodologies
OCI review of NAIC models and recommendations based upon preneed mortality studies with respect to the adequacy of financial reserves, and insurer's financial information.
Analysis and supporting documentation used to determine rule's effect on small businesses
This rule relates to insurer determination of minimum reserves and there is no significant effect on small businesses.
Small Business Impact
This rule will have little or no effect on small businesses.
Small business regulatory coordinator
The OCI small business coordinator is Eileen Mallow and may be reached at phone number (608) 266-7843 or at email address
eileen.mallow@wisconsin.gov
Fiscal Estimate
Summary
There will be no state or local government fiscal effect.
This rule change will have no significant effect on the private sector regulated by OCI.
State fiscal effect
None.
