164 
(1) POLICY.—In this subsection, the term ‘‘pol-
icy’’— 
(A) means a policy, contract, certificate, or 
other evidence of life insurance, disability in-
come insurance, or long-term care insurance, or 
an annuity contract or a rider or endorsement 
thereto; and 
(B) does not include— 
(i) a funding agreement; 
(ii) a reinsurance contract; or 
(iii) an agreement, special rider, or 
endorsement relating only to the manner of 
distributing benefits or to the reservation 
of rights and benefits used at the request 
of the individual policyholder. 
(2) RULEMAKING.—The Commissioner shall es-
tablish, by regulation, standards for policies issued 
by a national insurer. 
(3) TYPES
OF
POLICY
REQUIREMENTS.—The 
standards established under paragraph (2) may in-
clude general policy requirements and requirements 
regarding particular classes of policies. 
(e) PRODUCT FILINGS.— 
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(1) FORM FILING.—A national insurer shall not 
issue a policy until the form of the policy has been 
received by the Commissioner. 
(2) EXEMPTIONS.—The Commissioner may, by 
regulation, exempt particular categories of policies 
from the filing requirement. 
(3) COMPLIANCE CERTIFICATE.—In accordance 
with regulations promulgated by the Commissioner, 
any filing of a policy form shall be accompanied by 
written certification by an officer of the national in-
surer that the policy form complies with the stand-
ards applicable to such form. 
(f) INTERPRETIVE RULINGS.— 
(1) PROCEDURES.—The Commissioner shall es-
tablish procedures by which national insurers may 
obtain interpretive rulings from the Office regarding 
the interpretation and application of the standards 
established under this section. 
(2) PUBLIC AVAILABILITY.—Except as provided 
under paragraph (3), requests by national insurers 
for interpretive rulings from the Office and the com-
plete text of such interpretive rulings shall not be 
made available to the public. 
(3) PUBLICATION
OF
SUMMARIES.—Notwith-
standing paragraph (2), the Commissioner shall pub-
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166 
lish a summary of each interpretive opinion, exclud-
ing the name of the national insurer and any other 
identifying information, either promptly after the 
issuance of such opinion or, upon the request of the 
national insurer, after such delay as the Commis-
sioner determines appropriate. 
(g) GROUP, BLANKET, AND FRANCHISE INSUR-
ANCE.— 
(1) 
AUTHORIZATION.—A 
national 
insurer 
may— 
(A) sell, solicit, negotiate, and underwrite 
group, blanket, and franchise insurance policies; 
and 
(B) extend group, blanket, or franchise in-
surance policies to insure the dependents of em-
ployees or members, or any class of employees 
or members. 
(2) RULEMAKING.—The Commissioner shall, by 
regulation, establish standards for kinds and quali-
fications of permissible groups for group, blanket, 
and franchise insurance policies. 
(h) INSURABLE INTEREST.— 
(1) REGULATIONS
REQUIRED.—The Commis-
sioner shall, by regulation— 
(A) define the term ‘‘insurable interest’’; 
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167 
(B) identify what persons have an insur-
ance interest in the health and bodily safety of 
an individual; 
(C) establish circumstances under which 
an insurance policy issued with respect to an in-
dividual, other than a group insurance policy, 
may be effectuated, including any insured con-
sent requirements; and 
(D) establish rules for insurance policy 
transfers and assignments, which transactions 
shall be permitted for insurance policies written 
or sold in compliance with the regulations. 
(2) LIMITATION ON APPLICABILITY.—The regu-
lations required by paragraph (1) shall not apply to 
an annuity contract or a funding agreement. 
(i) EFFECT OF STATE LAW.—No State may, by stat-
ute, regulation, order, interpretation, or otherwise, impose 
any standard, relating to any matter addressed in this sec-
tion, on national insurers or persons who purchase insur-
ance from national insurers. 
SEC. 1215. PRODUCT REGULATION FOR NATIONAL PROP-
ERTY/CASUALTY INSURERS. 
(a) APPLICATION.—This section shall apply to the 
business of national property/casualty insurers. 
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168 
(b) MAINTENANCE OF COPIES OF POLICIES.—A na-
tional insurer shall maintain for inspection a copy of every 
insurance policy form that it uses to insure risks. 
(c) ANNUAL POLICY FORM LISTING.—A national in-
surer shall annually provide the Commissioner with a list 
of all standard policy forms it uses to insure risks and 
a copy of every such form. 
(d) RATES, RATING
ELEMENTS, PRICE, 
AND 
FORMS.—The Act does not authorize the Commissioner 
to require a national insurer to use any particular rate, 
rating element, price, or form. 
SEC. 1216. REGULATION OF SALES AND MARKETING. 
(a) PURPOSE.—The purpose of this section is to en-
sure appropriate Federal regulation of the sales and mar-
keting practices of national insurers, national agencies, 
and federally licensed insurance producers to prevent un-
fair methods of competition and unfair and deceptive acts 
and practices in the advertising, sale, issuance, distribu-
tion, and administration of insurance policies and other 
products of national insurers, and claims under insurance, 
policies and other products of national insurers. 
(b) RULEMAKING.—The Commissioner shall promul-
gate such regulations, applicable to national insurers, na-
tional agencies, and federally licensed insurance pro-
ducers, as the Commissioner determines to be necessary 
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169 
to carry out the purpose of this section, including rules 
governing the advertising, sale, issuance, distribution, and 
administration of insurance policies and other products of 
national insurers and claims under insurance policies and 
other products of national insurers. 
SEC. 1217. PROMPT CORRECTIVE ACTION. 
(a) RULEMAKING.— 
(1) IN GENERAL.—Not later than the expira-
tion of the 6-month period beginning upon the date 
of submission of the report under subsection (b)(3) 
to the Commissioner, the Commissioner shall pro-
mulgate such regulations, applicable to national in-
surers, as the Commissioner determines appropriate 
and consistent with the recommendation in that re-
port to ensure that prompt corrective action is taken 
to resolve any hazardous financial condition of a na-
tional insurer. 
(2) AUTHORIZED CONTENT.—Rules required by 
this subsection may include such capital measures 
and categories, capital standards, supervisory cri-
teria, restrictions on permissible actions of such in-
surers, requirements for such insurers, procedures, 
provisions regarding conservatorship and receiver-
ship of such insurers, and other provisions as the 
Commissioner considers are appropriate and con-
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sistent with any recommendations in the report and 
the 
regulations 
issued 
pursuant 
to 
section 
1212(a)(4). 
(b) GAO STUDY AND REPORT.— 
(1) IN GENERAL.—The Comptroller General of 
the United States shall conduct a study to identify 
an appropriate structure of procedures and require-
ments for taking prompt corrective actions with re-
spect to national insurers, to ensure that any haz-
ardous financial condition of such a national insurer 
is resolved effectively and efficiently, with the fewest 
possible losses. 
(2) REQUIREMENTS.—In conducting the study 
required by this subsection, the Comptroller General 
shall analyze and evaluate various proposals, struc-
tures, methods, and systems for taking prompt cor-
rective actions with respect to various financial enti-
ties and institutions, including— 
(A) the prompt corrective action require-
ments under section 38 of the Federal Deposit 
Insurance Act (12 U.S.C. 1831o) with respect 
to insured depository institutions; and 
(B) the ‘‘Model Regulation to Define 
Standards and Commissioner’s Authority for 
Companies Deemed to be in Hazardous Finan-
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171 
cial Condition’’ of the NAIC, as updated in 
2006. 
(3) REPORT.— 
(A) IN GENERAL.—Not later than the ex-
piration of the 6-month period beginning on the 
date of enactment of this Act, the Comptroller 
General shall submit a report to the Committee 
on Banking, Housing, and Urban Affairs of the 
Senate, the Committee on Financial Services of 
the House of Representatives, and the Commis-
sioner, regarding the study required under this 
subsection. 
(B) 
CONTENTS.—The 
report 
required 
under this paragraph shall describe the study 
and the results of the evaluations conducted 
under the study, and shall include a specific 
recommendation to the Commissioner for estab-
lishment of an appropriate structure of proce-
dures and requirements for taking prompt cor-
rective actions with respect to national insurers, 
to ensure that any hazardous financial condi-
tion of a national insurer is resolved effectively 
and efficiently with the fewest possible losses. 
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172 
Subtitle C—Reinsurance 
SEC. 1221. FEDERAL LICENSING OF REINSURERS. 
(a) AUTHORITY TO LICENSE.— 
(1) IN GENERAL.—The Commissioner may— 
(A) license insurers that are not National 
Insurers to provide reinsurance; and 
(B) prescribe, by regulation, the standards 
and procedures for granting such licenses. 
(2) CRITERIA.—The standards prescribed under 
paragraph (1)(B) shall give due consideration to— 
(A) the public interest in providing secure 
and sufficient reinsurance capacity in the 
United States; and 
(B) the need for promoting fair and effec-
tive competition. 
(b) DETERMINATION AND FINDING; ISSUANCE OF LI-
CENSE.— 
(1) EXAMINATION AND INVESTIGATION.—Upon 
the receipt of an application for a license under this 
section, the Commissioner shall examine the infor-
mation submitted by the applicant and may conduct 
further examinations and investigations, as nec-
essary, to determine whether the applicant satisfies 
the standards for a license under this section. 
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(2) PUBLICATION OF FINDINGS.—The Commis-
sioner shall publish the Commissioner’s findings and 
determination under paragraph (1). 
(3) ISSUANCE OF FEDERAL LICENSE.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), if the Commissioner deter-
mines that the applicant has satisfied the appli-
cable requirements of this section, the Commis-
sioner shall issue a Federal license to provide 
reinsurance. 
(B) 
RESTRICTION.—The 
Commissioner 
shall not issue a Federal license for reinsurance 
until after the Commissioner is authorized to 
charter and license a National Insurer pursuant 
to section 1211. 
(c) MINIMUM STANDARDS FOR LICENSING OF NON- 
UNITED STATES INSURERS.—The Commissioner shall not 
issue a license under this section to any insurer that is 
not a State insurer or a United States branch of a non- 
United States insurer unless the insurer agrees to— 
(1) report its financial statements to the Com-
missioner on a basis that the Commissioner deter-
mines to be— 
(A) substantially similar to that required 
of National Insurers under section 1124; or 
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