piers109uk/MN-Statutes huggingface dataset:
60L.03 MINIMUM FINANCIAL SECURITY BENCHMARK.
Except as otherwise provided in subdivisions 2 and 3, the amount of the minimum financial security benchmark for an insurer is the greater of:
(1) the authorized control level risk-based capital applicable to the insurer as defined under section 60A.60, subdivision 11, clause (3); or
(2) the minimum capital or minimum surplus required for maintenance of an insurer's certificate of authority.
The commissioner may, according to the controlling factors specified in subdivision 6, establish by order a minimum financial security benchmark to apply to a specific insurer provided it is not less than the amount determined under subdivision 1.
The commissioner may establish a minimum financial security benchmark that is a multiple of authorized control level risk-based capital to apply to any class of insurers provided the amount established is not less than the amount specified under subdivision 1.
The commissioner shall determine the amount of surplus that constitutes an insurer's minimum financial security benchmark as an amount that will provide reasonable security against contingencies affecting the insurer's financial position that are not fully covered by reserves or by reinsurance.
The commissioner shall consider the risks of:
(1) increases in the frequency or severity of losses beyond the levels contemplated by the rates charged;
(2) increases in expenses beyond those contemplated by the rates charged;
(3) decreases in the value of or the return on invested assets below those planned on;
(4) changes in economic conditions that would make liquidity more important than contemplated and would force untimely sale of assets or prevent timely investments;
(5) currency devaluation to which the insurer may be subject; and
(6) any other contingencies the commissioner can identify that may affect the insurer's operations.
In making the determination under subdivision 4, the commissioner shall take into account the following factors:
(1) the most reliable information available as to the magnitude of the various risks under subdivision 5;
(2) the extent to which the risks specified under subdivision 5 are independent of each other or are related, and whether any dependency is direct or inverse;
(3) the insurer's recent history of profits or losses;
(4) the extent to which the insurer has provided protection against the contingencies in other ways than the establishment of surplus, including redundancy of premiums, adjustability of contracts under their terms, investment valuation reserves whether voluntary or mandatory, appropriate reinsurance, the use of conservative actuarial assumptions to provide a margin of security, reserve adjustments in recognition of previous rate inadequacies, contingency or catastrophe reserves, diversification of assets, and underwriting risks;
(5) independent judgments of the soundness of the insurer's operations, as evidenced by the ratings of reliable professional financial reporting services; and
(6) any other relevant factors.
60L.05 PRUDENCE EVALUATION CRITERIA.
The factors in clauses (1) to (12) shall be evaluated by the insurer and considered along with its business in determining whether an investment portfolio or investment policy is prudent. The commissioner shall consider the factors in clauses (1) to (12) before making a determination that an insurer's investment portfolio or investment policy is not prudent:
(1) general economic conditions;
(2) the possible effect of inflation or deflation;
(3) the expected tax consequences of investment decisions or strategies;
(4) the fairness and reasonableness of the terms of an investment considering its probable risk and reward characteristics and relationship to the investment portfolio as a whole;
(5) the extent of the diversification of the insurer's investments among individual investments, classes of investments, industry concentrations, dates of maturity, and geographic areas;
(6) the quality and liquidity of investments in affiliates;
(7) the investment exposure to the following risks, quantified in a manner consistent with the insurer's acceptable risk level identified in section 60L.06, clause (8): liquidity; credit and default; systemic (market); interest rate; call, prepayment and extension; currency; and foreign sovereign;
(8) the amount of the insurer's assets, capital and surplus, premium writings, insurance in force, and other appropriate characteristics;
(9) the amount and adequacy of the insurer's reported liabilities;
(10) the relationship of the expected cash flows of the insurer's assets and liabilities, and the risk of adverse changes in the insurer's assets and liabilities;
(11) the adequacy of the insurer's capital and surplus to secure the risks and liabilities of the insurer; and
(12) any other factors relevant to whether an investment is prudent.
60L.04 AUTHORIZED INVESTMENTS.
Subject to the provisions of sections 60L.01 to 60L.15, an insurer may loan or invest its funds, and may buy, sell, hold title to, possess, occupy, pledge, convey, manage, protect, insure, and deal with its investments, property, and other assets to the same extent as any other corporation or other person under the laws of this state or the United States.
With respect to all of the insurer's investments, the board of directors of an insurer shall exercise the judgment and care, under the circumstances then prevailing, that persons of reasonable prudence, discretion, and intelligence exercise in the management of a like enterprise, not in regard to speculating but in regard to the permanent disposition of their funds, considering the probable income as well as the probable safety of their capital. Investments must be of sufficient value, liquidity, and diversity to ensure the insurer's ability to meet its outstanding obligations based on reasonable assumptions as to new business production for current lines of business. As part of its exercise of judgment and care, the board of directors shall take into account the prudence evaluation criteria specified under section 60L.05.
The insurer shall establish and implement internal controls and procedures to ensure compliance with investment policies and procedures to ensure that:
(1) the insurer's investment staff and any consultants used are reputable and capable;
(2) a periodic evaluation and monitoring process occurs for assessing the effectiveness of investment policy and strategies;
(3) management's performance is assessed in meeting the stated objectives within the investment policy; and
(4) appropriate analyses are undertaken of the degree to which asset cash flows are adequate to meet liability cash flows under different economic environments. The analyses must be conducted at least annually and make specific reference to economic conditions.
Compliance with sections 60L.01 to 60L.15 is determined in light of the facts and circumstances existing at the time of the insurer's decision or action and not by hindsight.
60M.01 DEFINITIONS.
For the purposes of this chapter, the terms defined in this section have the meanings given.
"Bail bond" means a three-party contract between the state, the accused, and the surety whereby an individual is released to the custody of the surety, and the surety guarantees to the state the appearance of the individual at all criminal proceedings for which the surety bond is posted.
"Bail bond agency" means an agency contracted by a surety to supervise or otherwise manage the bail bond business written in Minnesota by producers appointed by the surety.
"Commissioner" means the commissioner of commerce.
"Department" means the Department of Commerce.
"Depositor" means:
(1) an individual that has paid money to a surety, bail bond agency, or producer as premium or premium toward a bail bond product transaction, as defined in section 60M.02; or
(2) an individual that deposited money, property, or assets with a surety, bail bond agency, or producer to be held as collateral or used toward the liability of a bail bond product transaction, as defined in section 60M.03.
"Negotiate" means the act of conferring directly with or offering advice directly to a purchaser or prospective purchaser of a particular insurance contract concerning any of the substantive benefits, terms, or conditions of the contract, if the person engaged in the act either sells insurance or obtains insurance from insurers for purchasers.
"Net premium" means a bond's premium, less any commission agreed to in advance and in writing between a producer and the surety or bail bond agency.
"Personal information" has the meaning given in section 72A.491, subdivision 17.
"Principal" is an individual who has engaged with a bail bond agency or producer to arrange for the individual's bail bond to be posted on the individual's behalf, securing the individual's release pretrial on a bail bond.
"Privileged information" has the meaning given in section 72A.491, subdivision 19.
"Producer" means a person that is licensed to write bail bonds, has been approved by the state court administrator's office, is a contractor or employee for a bail bond agency, and is appointed by a surety to execute or countersign bail bonds for the surety in connection with judicial proceedings.
"Sell" means to exchange a bail bond product for money on behalf of a surety company.
"Surety" means a domestic, foreign, or alien insurance company that is licensed to transact surety business in Minnesota under section 60A.06.
60L.06 INSURER INVESTMENT POLICY.
In acquiring, investing, exchanging, holding, selling, and managing investments, an insurer shall establish and follow a written investment policy that must be reviewed and approved by the insurer's board of directors at least annually. The content and format of an insurer's investment policy are at the insurer's discretion, but must include written guidelines appropriate to the insurer's business as to the following:
(1) the general investment policy of the insurer containing policies, procedures, and controls covering all aspects of the investing function;
(2) quantified goals and objectives regarding the composition of classes of investments, including maximum internal limits;
(3) periodic evaluation of the investment portfolio as to its risk and reward characteristics. This clause does not preclude an insurer from the use of modern portfolio theory to manage its investments. For purposes of this section, "modern portfolio theory" means the collection of models and applications that prescribe the maximization of expected returns for a given level of aggregate risk as the primary objective of investment portfolio management;
(4) professional standards for the individuals making day-to-day investment decisions to ensure that investments are managed in an ethical and capable manner;
(5) the types of investments to be made and those to be avoided, based on their risk and reward characteristics and the insurer's level of experience with the investments;
(6) the relationship of classes of investments to the insurer's insurance products and liabilities;
(7) the manner in which the insurer intends to implement section 60L.05; and
(8) the level of risk, based on quantitative measures, appropriate for the insurer given the level of capitalization and expertise available to the insurer.
60L.07 AUTHORIZED CLASSES OF INVESTMENTS.
The following classes of investments may be counted for the purposes specified in section 60L.11, whether they are made directly or as a participant in a partnership, joint venture, or limited liability company:
(1) cash in the direct possession of the insurer or on deposit with a financial institution regulated by any federal or state agency of the United States;
(2) bonds, debt-like preferred stock, and other evidences of indebtedness of governmental units in the United States or Canada, or the instrumentalities of the governmental units, or private business entities domiciled in the United States or Canada, including asset-backed securities and SVO listed mutual funds;
(3) loans secured by mortgages, trust deeds, or other security interests in real property located in the United States or Canada or secured by insurance against default issued by a government insurance corporation of the United States or Canada or by an insurer authorized to do business in this state;
(4) common stock or equity-like preferred stock or equity interests in any United States or Canadian business entity, or shares of mutual funds registered with the Securities and Exchange Commission of the United States under the Investment Company Act of 1940, other than SVO listed mutual funds;
(5) real property necessary for the convenient transaction of the insurer's business;
(6) real property and its fixtures, furniture, furnishings, and equipment in the United States or Canada, which produces or after suitable improvement can reasonably be expected to produce substantial income;
(7) loans, securities, or other investments of the types described in clauses (1) to (6) in countries other than the United States and Canada;
(8) bonds or other evidences of indebtedness of international development organizations of which the United States is a member;
(9) loans upon the security of the insurer's own policies in amounts that are adequately secured by the policies and that in no case exceed the surrender values of the policies;
(10) tangible personal property under contract of sale or lease under which contractual payments may reasonably be expected to return the principal of and provide earnings on the investment within its anticipated useful life;
(11) other investments authorized by the commissioner; and
(12) investments not otherwise permitted by this section, and not specifically prohibited by other law, to the extent of not more than five percent of the first $500,000,000 of the insurer's admitted assets plus ten percent of the insurer's admitted assets exceeding $500,000,000.
60L.10 PROHIBITED INVESTMENTS.
An insurer may not invest in investments that are prohibited for an insurer by law. The use of a derivative instrument for any purposes other than hedging, income generation, or replication is prohibited.
A reasonable time, not to exceed five years, must be allowed for disposal of a prohibited investment in hardship cases if the investment is demonstrated by the insurer to have been legal when made, or the result of a mistake made in good faith, or if the commissioner determines that the sale of the asset would be contrary to the interests of insureds, creditors, or the general public.
60L.09 PROTECTION AGAINST CURRENCY FLUCTUATIONS.
An insurer doing business that requires it to make payments in different currencies shall have investments in securities in each of these currencies in an amount that independently of all other investments meets the requirements of sections 60L.01 to 60L.15 as applied separately to the insurer's obligations in each currency. The commissioner may by order exempt an insurer, or a class of insurers, from this requirement if the obligations in other currencies are small enough that no significant problem for financial solidity would be created by substantial fluctuations in relative currency values.
60L.12 REPORTS AND REPLIES.
The commissioner may require any of the following from a person subject to regulation under sections 60L.01 to 60L.15:
(1) statements, reports, answers to questionnaires and other information, and evidence in whatever reasonable form the commissioner designates, and at reasonable intervals as the commissioner chooses;
(2) full explanation of the programming of any data storage or communication system in use; or
(3) that information from any books, records, electronic data processing systems, computers, or any other information storage system be made available to the commissioner at a reasonable time and in a reasonable manner.
The commissioner may prescribe forms for the reports required under subdivision 1 and specify who shall execute or certify the reports. The forms for the reports required under subdivision 1 must be consistent, so far as practicable, with those prescribed by other jurisdictions.
The commissioner may prescribe reasonable minimum standards and techniques of accounting and data handling to ensure that timely and reliable information will exist and will be available to the commissioner.
Any officer, manager, or general agent of an insurer subject to sections 60L.01 to 60L.15, any person controlling or having a contract under which the person has a right to control the insurer, whether exclusively or otherwise, or a person with executive authority over or in charge of any segment of the insurer's affairs, shall reply promptly in writing or in other reasonably designated form, to a written inquiry from the commissioner requesting a reply.
The commissioner may require that any communication made to the commissioner under this section be verified.
A communication to the commissioner, or to an expert or consultant retained by the commissioner, required under sections 60L.01 to 60L.15, shall not subject the person making it to an action for damages for the communication in the absence of actual malice.
Notwithstanding subdivision 6, the commissioner may bring suit against any person providing information required under sections 60L.01 to 60L.15 that is not truthful and accurate.
60M.06 UNLICENSED INDIVIDUALS; NO REBATES OR PAYMENT.
(a) With the exception of a contracted bail enforcement agent offering a reward for information that assists in the location and apprehension of a principal under section 629.63, a surety, bail bond agency, or producer is prohibited from paying a fee or commission, or otherwise giving or promising anything of value, to: (1) a jailer, police officer, peace officer, or any other person who has the power to arrest or hold an individual in custody; or (2) a judge, public official, or public employee.
(b) A surety, bail bond agency, or producer is prohibited from paying a fee or rebate, or otherwise giving or promising anything of value, to the individual seeking the producer's services or the individual seeking the producer's services on another individual's behalf.
(c) A surety, bail bond agency, or producer is prohibited from paying a fee or commission, or otherwise giving or promising anything of value, to a person for selling, soliciting, or negotiating a bail bond if the person is not properly licensed as a producer.
(d) A surety, bail bond agency, or producer is prohibited from paying a fee, rebate, or commission, or otherwise giving or promising anything of value, to an inmate for referring business or for any other reason related to soliciting, negotiating, or selling a bail bond.
60L.15 ADMINISTRATIVE HEARINGS.
An insurer aggrieved by an order or any other act or failure to act of the commissioner regarding compliance with sections 60L.01 to 60L.15, may request a hearing by following the procedures of chapter 14.
The commissioner shall hold hearings under this section privately unless the insurer requests a public hearing, in which case the hearing is public.
60L.11 EFFECT OF INVESTMENT RESTRICTIONS.
Invested assets may be counted toward satisfaction of the minimum asset requirement only so far as they are invested in compliance with sections 60L.01 to 60L.15 and orders issued by the commissioner. Assets other than invested assets may be counted toward satisfaction of the minimum asset requirement at admitted annual statement value.
An investment which is held as an admitted asset by an insurer on the date on which sections 60L.01 to 60L.15 begin to govern the insurer and which qualified as an admitted asset immediately before this date remain qualified as an admitted asset under sections 60L.01 to 60L.15.
Assets acquired in the bona fide enforcement of creditors' rights or in bona fide workouts or settlements of disputed claims may be counted for the purposes of subdivision 1 for five years after acquisition if real property and three years if not real property, even if they could not otherwise be counted under sections 60L.01 to 60L.15. The commissioner may allow reasonable extensions of these periods if replacement of the assets within the periods would not be possible without substantial loss.
If an insurer does not own, or is unable to apply toward compliance with sections 60L.01 to 60L.15, an amount of assets equal to its minimum asset requirement, the commissioner may consider it to be financially hazardous under section 60B.15; 60B.20; or 60G.20.
60L.13 RETENTION OF EXPERTS.
The commissioner may retain at the insurer's expense attorneys, actuaries, accountants, and other experts not otherwise a part of the commissioner's staff as may be reasonably necessary to assist in reviewing the insurer's investments. Persons so retained are under the direction and control of the commissioner and shall act in a purely advisory capacity.
60L.14 COMMISSIONER'S ORDERS.
If the commissioner determines that an insurer's investment practices do not meet the requirements of sections 60L.01 to 60L.15, the commissioner may, after notification to the insurer of the commissioner's findings, order the insurer to make changes necessary to comply with the requirements of sections 60L.01 to 60L.15.
If the commissioner determines that by reason of the financial condition, current investment practice, or current investment plan of an insurer, the interests of insureds, creditors, or the general public are or may be endangered, the commissioner may impose reasonable additional restrictions upon the admissibility or valuation of investments or may impose restrictions on the investment practices of an insurer, including prohibition, divestment, or requiring investments by insurers to be governed by section 60A.11 in the case of insurers other than life insurers, and sections 61A.28; 61A.282, subdivision 2; 61A.283; 61A.29; 61A.31; and 61A.315 in the case of life insurers.
The commissioner may count toward satisfaction of the minimum asset requirement any assets in which an insurer is required to invest under the laws of a country other than the United States as a condition for doing business in that country if the commissioner finds that counting them does not endanger the interests of insureds, creditors, or the general public.
If the commissioner is satisfied by evidence of the solidity of an insurer and the competence of management and its investment advisors, the commissioner, after a hearing, may by order adjust the class limitations under section 60L.08, for that insurer, to the extent that the commissioner is satisfied that the interests of insureds, creditors, and the public are sufficiently protected in other ways. Adjustments to the class limitations granted under section 60L.08, in aggregate, are limited to an amount equal to ten percent of the insurer's liabilities.
61A.01 LIFE INSURANCE COMPANY DEFINED.
Every corporation or association, domestic or foreign, operating upon any plan involving payment of money or other thing of value to policy or certificate holders, or members, or families, or representatives of either, conditioned upon the continuance or cessation of human life, or for the payment of endowments or annuities (except benevolent, fraternal, cooperative or secret societies of orders for the sole purpose of mutual welfare, protection and relief of their members and the payment of stipulated amounts, or the proceeds of assessments, to the families of deceased members), shall be deemed a life insurance company, and wherever used in this chapter, the terms "company," "life company," "corporation" or "association" shall be construed to mean life insurance company unless the context clearly indicates otherwise.
61A.012 ANNUAL NOTICE REQUIRED.
For each policy of individual life insurance issued or delivered in Minnesota, a life insurance company must provide a written notice to the policyholder that contains the following information, as applicable:
(1) the policyholder;
(2) the policy number;
(3) the insured life; and
(4) the current contact information for the life insurance company.
The notice required under this section must be provided by the life insurance company to the policyholder at least once per calendar year, sent via United States mail to the policyholder's last known address or electronically to the policyholder's last known email address.
This section's annual notice requirement is satisfied by an annual report provided by a life insurance company to a policyholder pursuant to and in compliance with section 61A.735.
61A.021 SALE OF LIFE INSURANCE AND ANNUITY AS SINGLE POLICY PROHIBITED.
The sale of a life insurance product and an annuity as a single policy, whether in the form of a life insurance policy with an annuity rider or otherwise, is prohibited in this state. This subdivision does not prohibit the simultaneous sale of these products, but the sale must involve two separate and distinct policies.
The tying of the sale of a life insurance product and an annuity is expressly prohibited. The sale of one policy cannot be conditioned upon the sale of a second policy. A violation of subdivision 1 is an unfair and deceptive trade practice under chapter 72A.
The commissioner may exempt by order such a product from this section if it is in the public interest.
This section applies to all sales where applications are completed on or after July 1, 1985.
61A.031 SUICIDE PROVISIONS.
(a) The mental competency of a person shall not be a factor in determining whether a person completed suicide within the terms of an individual or group life insurance policy regulating the payment of benefits in the event of the insured's suicide. This paragraph shall not be construed to alter present law but is intended to clarify present law.
(b) A life insurance policy or certificate issued or delivered in this state may exclude or restrict liability for any death benefit in the event the insured dies as a result of suicide within one year from the date of the issue of the policy or certificate. Any exclusion or restriction shall be clearly stated in the policy or certificate. Any life insurance policy or certificate which contains any exclusion or restriction under this paragraph shall also provide that in the event any death benefit is denied because the insured dies as a result of suicide within one year from the date of issue of the policy or certificate, the insurer shall refund all premiums paid for coverage providing the denied death benefit on the insured.
61A.04 SPENDTHRIFT PROVISIONS.
In addition to the provisions now required by law to be in the standard form of life insurance policies issued or delivered in this state, there shall be, when such policy provides for the payment to the beneficiary the proceeds thereof, in either monthly, quarterly, semiannual or annual installments, to continue during the lifetime of the beneficiary, or for a stipulated number of years, whenever requested by the insured under the policy, the following provisions:
All rights of the beneficiary to commute, change time of payment or amount of installments, surrender for cash, borrow against or assign for any purpose, are hereby withdrawn and those parts of this policy giving the beneficiary such rights are hereby declared inoperative and void; it being the intent hereof that the beneficiary shall have no right under this contract except to receive the installments at such times and in such amounts as stated in this policy, and all the provisions of this policy in conflict herewith are hereby declared to be inoperative.
This provision may be attached to any policy in the form of a rider thereon, and, when so attached, shall become a part of and form a part of the contract of insurance, evidenced by the policy to all intents and purposes as if set forth at length therein.
61A.05 LIFE POLICIES TO CONTAIN ENTIRE CONTRACT.
Every policy of insurance issued or delivered within this state on or after the first day of January, 1908, by any life insurance corporation doing business within the state, shall contain the entire contract between the parties.
Every policy which contains a reference to the application, either as a part of the policy or as having any bearing thereon, shall have a copy of such application attached thereto or set out therein.
61A.07 PROHIBITED PROVISIONS.
No policy of life insurance shall be issued or delivered in this state, or be issued by a life insurance company organized under the laws of this state, if it contains a provision:
(1) for forfeiture of the policy for failure to repay any loan on the policy or to pay interest on such loan while the total indebtedness on the policy is less than the loan value thereof; or for forfeiture for failure to repay any such loan or to pay interest thereon, unless such provision contain a stipulation that no such forfeiture shall occur until at least one month after notice shall have been mailed by the company to the last known address of the insured and of the assignee, if any, notice of whose address and contract of the assignment has been filed with the company, at its home office; or
(2) in a life policy or annuity contract, limiting the time within which any action at law or in equity may be commenced to less than five years after the cause of action shall accrue; or
(3) by which the policy shall purport to be issued or to take effect more than six months before the original application for the insurance was made; or
(4) for any mode of settlement at maturity of less value than the amount insured on the face of the policy plus any dividend additions, less any indebtedness to the company on the policy, and less any premium that may be deducted by the terms of the policy.
61A.06 AVIATION AND WAR RISK EXCLUSION PERMITTED.
Policies of life insurance may be delivered or issued for delivery in this state which limit the amount to be paid in the event of death occurring as a result of travel or flight in, or descent from or with, any kind of aircraft if the insured (1) is a pilot, officer or member of the crew of such aircraft, or is participating in aeronautic or aviation training during such flight, or (2) is in the military, naval or air forces of any country and is being transported in a military, naval or air force aircraft. Such amount shall not be less than the reserve on the policy plus any dividends standing to the credit of the policy and the reserve for any paid-up additions, less any indebtedness to the company on the policy. Such limitation may be made by a provision in the policy or by a rider made a part thereof provided, that no such limitation shall be effective unless and until the insured or applicant shall agree in writing thereto; and provided, further, that except in case of policies issued on the lives of persons who have received aeronautic or aviation training or whose occupation entails duty aboard aircraft in flight, such limitation shall apply only in event death occurs within five years after date of issue of the policy. This section shall not affect the validity of provisions which limit the amount to be paid in the event of death of the insured while in the military, naval or air forces of any country at war, or of provisions relative to benefits in the event of total and permanent disability, or of provisions which grant additional insurance specifically against death by accident. Policies issued by life insurance companies organized under the laws of this state for delivery in any other state, territory, district, or country may contain any provisions limiting the amount to be paid in the event of death which are permitted by the laws of such other state, territory, district, or country.
61A.071 APPLICATIONS.
No individual life insurance policy shall be issued or delivered in this state to a person age 65 or older unless a signed and completed copy of the application for insurance is left with the applicant at the time application is made. This requirement will not apply to life insurers who mail a copy of the signed, completed application to the applicant within 24 hours of receiving the application. However, where an individual life policy is marketed on a direct response basis, a copy of any application signed by the applicant shall be delivered to the insured along with, or as part of, the policy.
61A.08 EXCEPTIONS.
Sections 61A.02, 61A.03, 61A.07, 61A.23, and 61A.25 shall not, except as expressly provided in this chapter, apply to industrial or group term policies, or to corporations or associations operating on the assessment or fraternal plan, but every contract issued prior to the operative date specified in section 61A.245 containing a provision for a deferred annuity on the life of the insured only, unless paid for by a single premium, shall provide that, in event of the nonpayment of any premium after three full years' premium shall have been paid, the annuity shall automatically become converted into a paid-up annuity for that proportion of the original annuity as the number of completed years' premiums paid bears to the total number of premiums required under the contract.
61A.091 EMPLOYEE GROUP LIFE INSURANCE PLANS.
No employer who makes available or otherwise sponsors a group life insurance plan that provides life insurance benefits to more than five employees of that employer, whether through insurance policies, self-insurance, or any combination of these arrangements, may require an employee to participate in the life insurance plan as a condition of employment, unless the employer pays the full cost of the plan. No employer may discharge any employee who pursuant to this section refuses to contribute to an employee group life insurance plan, nor shall the employer discriminate or otherwise retaliate against the employee who pursuant to this section refuses to contribute to an employee group life insurance plan. An employee may bring an action against an employer for recovery of any wages withheld in violation of this section. This remedy shall be in addition to any other remedy provided by law. For the purposes of this section, "employer" means any natural person, company, corporation, partnership, association or firm which employs any employee. "Employee" is an individual as defined by section 62E.02, subdivision 8. This section does not apply where a collectively bargained contract provides for mandatory participation in a group life insurance plan. This section does not apply to any insurance purchased or carried for the purpose of buying or selling any part of employer, its shares, its assets or its business. This section does not apply to any insurance purchased or carried by any pension, profit sharing or other retirement plan or trust.
All group life insurance policies covering employees of an employer containing a waiver of premium benefits upon total disability of the employee shall provide that termination of the master policy, for any reason whatsoever, will be without prejudice to the claim of any covered employee who is suffering from a disability, as defined in the group life policy waiver of premium section at the time of the termination. This subdivision may be superseded by a rule promulgated by the commissioner of commerce.
61B.18 CITATION.
Sections 61B.18 to 61B.32 may be cited as the "Minnesota Life and Health Insurance Guaranty Association Act."
61A.093 CERTIFICATE OF INSURANCE.
A certificate of insurance or similar evidence of coverage issued to a Minnesota resident shall provide coverage for all benefits required to be covered in group policies in Minnesota by this chapter.
This subdivision supersedes any inconsistent provision of this chapter.
A policy of life insurance that is issued or delivered in this state and that covers a person residing in another state may provide coverage or contain provisions that are less favorable to that person than required by this chapter. Less favorable coverages or provisions must meet the requirements that the state in which the person resides would have required had the policy been issued or delivered in that state.
Subdivision 1 does not apply to certificates issued in regard to a master policy issued outside the state of Minnesota if all of the following are true:
(1) the policyholder or certificate holder exists primarily for purposes other than to obtain insurance;
(2) the policyholder or certificate holder is not a Minnesota corporation and does not have its principal office in Minnesota;
(3) the policy or certificate covers fewer than 25 persons who are residents of Minnesota and the Minnesota residents represent less than 25 percent of all covered persons; and
(4) on request of the commissioner, the issuer files with the commissioner a copy of the policy and a copy of each form of certificate.
Section 60A.08, subdivision 4, shall not be construed as requiring a certificate of insurance or similar evidence of insurance that meets the conditions of subdivision 2 to comply with this chapter.
61A.10 EXTENSION OF TIME FOR PAYMENT OF PREMIUMS.
Parties to any policy of life insurance now or hereafter issued shall have the right at any time to mutually agree, in writing, for an extension of time in which to pay a second or subsequent premium on the policy, upon condition that the failure to pay the amount agreed upon at the time agreed, shall lapse the policy as of the date mutually agreed upon in the writing; provided, no such agreement shall impair any right to extended or paid-up insurance which the insured may have under the policy, nor any right to have the premiums, any part thereof, or the amount payable for the extension charged against the policy under the terms of the policy. No such agreement need be attached to or made a part of the insurance policy so affected.
61B.21 MINNESOTA LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION.
The Minnesota Life and Health Insurance Guaranty Association shall perform its functions under the plan of operation established and approved under section 61B.25, and shall exercise its powers through a board of directors. The association is not a state agency for purposes of chapter 16A, 16B, 16C, or 43A. For purposes of administration and assessment, the association shall establish and maintain two accounts:
(1) the life insurance and annuity account which includes the following subaccounts:
(i) the life insurance account;
(ii) the annuity account; and
(iii) the unallocated annuity account; and
(2) the health account.
The association is under the immediate supervision of the commissioner and is subject to the applicable provisions of the insurance laws of this state.
61A.11 MISSTATEMENT, WHEN NOT TO INVALIDATE POLICY.
In any claim upon a policy issued in this state without previous medical examination, or without the knowledge or consent of the insured, or, in case of a minor, without the consent of a parent, guardian, or other person having legal custody, the statements made in the application as to the age, physical condition, and family history of the insured shall be valid and binding upon the company, unless willfully false or intentionally misleading.
61B.22 BOARD OF DIRECTORS.
The board of directors of the association consists of nine member insurers serving terms as established in the plan of operation under section 61B.25. The insurer board members must be elected by member insurers, subject to the approval of the commissioner, for the terms of office specified in their nominations. Each elected insurer board member shall designate its representative and may designate an alternate. Vacancies on the board shall be filled for the remaining period of the term by a majority vote of the remaining board members, subject to approval of the commissioner. In approving selections or in appointing insurer board members, the commissioner shall consider whether all member insurers are fairly represented.
Members of the board may be reimbursed from the assets of the association for reasonable and necessary expenses incurred by them as members of the board, but shall not otherwise be compensated by the association for their services.
Except as otherwise required under the plan of operation:
(a) The board of directors may designate three or more directors as an executive committee, which, to the extent determined by unanimous affirmative action of the entire board, has and shall exercise the authority of the board in the management of the business of the association. This executive committee shall act only in the interval between meetings of the board, and is subject at all times to the control and direction of the board.
(b) The board of directors may create additional committees, which have and shall exercise the specific authority and responsibility as determined by the unanimous affirmative action of the entire board.
(c) Any action that may be taken at a meeting of the board of directors or of a lawfully constituted executive committee may be taken without a meeting if authorized by a writing or writings signed by all the directors or by all of the members of the committee, as the case may be. This action is effective on the date on which the last signature is placed on the writing or writings, or on an earlier effective date established in the writing or writings.
(d) Members of the board of directors or of a lawfully constituted executive committee may participate in a meeting of the board or committee by means of conference telephone or similar communications equipment through which all persons participating in the meeting can hear each other. Participation in a meeting as provided in this paragraph constitutes presence in person at the meeting.
Board meetings are not subject to chapter 13D.
61A.12 BENEFICIARIES.
When any insurance is effected in favor of another, the beneficiary shall be entitled to its proceeds against the creditors and representatives of the person effecting the same. All premiums paid for insurance in fraud of creditors, with interest thereon, shall inure to their benefit from the proceeds of the policy, if the company be specifically notified thereof, in writing, before payment.
Every policy made payable to, or for the benefit of, the spouse of the insured, or after its issue assigned to or in trust for a spouse, shall inure to that person's separate use and that of the children of the insured or the insured's spouse, subject to the provisions of this section.
[Repealed, 1973 c 725 s 91]
The person applying for and procuring a policy may change the beneficiary or beneficiaries, if the consent of the beneficiary or beneficiaries named in the policy is obtained, or if a power so to do is reserved in the contract of insurance or in case of the death of the beneficiary, or in the case of the dissolution of a marriage between the insured and the beneficiary subject to any limitations on the power to change beneficiaries imposed as a condition of the dissolution.
When a creditor requires credit life insurance, credit accident and health insurance, or both, as additional security for an indebtedness, the debtor shall be given the option of furnishing the required amount of insurance through existing policies of insurance owned or controlled by the debtor or procuring and furnishing the required coverage through any insurer authorized to transact insurance business in this state. If this subdivision is applicable, the debtor shall be informed by the creditor of the right to provide alternative coverage before the transaction is completed.
61A.13 DEFINITIONS.
When used in sections 61A.13 to 61A.21, "contract on a variable basis" means any contract on either a group or an individual basis issued by a life insurance company providing for the dollar amount of benefits or other contractual payments or values thereunder to vary so as to reflect investment results of a separate account in which amounts have been placed in connection with any such contracts. Such contracts may also provide benefits or values incidental thereto payable in fixed or variable dollar amounts, or both.
[Repealed, 1969 c 752 s 18]
61B.25 PLAN OF OPERATION.
The purpose of the plan of operation is to assure the fair, reasonable, and equitable administration of the association under sections 61B.18 to 61B.32. Amendments to the plan of operation must be submitted to the commissioner and become effective upon the commissioner's written approval or 30 days after submission if the commissioner has not disapproved. If the association fails to submit suitable amendments to the plan, the commissioner shall, after notice and hearing, adopt reasonable rules necessary or advisable to implement sections 61B.18 to 61B.32. The rules shall continue in force until modified by the commissioner or superseded by amendments submitted by the association and approved by the commissioner.
All member insurers shall comply with the plan of operation.
The plan of operation must, in addition to requirements specified in sections 61B.18 to 61B.32:
(1) establish procedures for handling the assets of the association;
(2) establish the amount and method of reimbursing members of the board of directors under section 61B.22;
(3) establish regular places and times for meetings including telephone conference calls of the board of directors or of the executive committee;
(4) establish procedures for records to be kept of all financial transactions of the association, its agents, and the board of directors;
(5) establish procedures for selecting the board of directors;
(6) establish any additional procedures for assessments under section 61B.24; and
(7) contain additional provisions necessary or proper for the execution of the powers and duties of the association.
The plan of operation may provide that any or all powers and duties of the association, except those under sections 61B.23, subdivision 13, clause (3), and 61B.24, are delegated to a corporation, association, or other organization which performs or will perform functions similar to those of this association, or its equivalent, in two or more states. The corporation, association, or organization shall be reimbursed for any payments made on behalf of the association and shall be paid for its performance of any function of the association. A delegation under this subdivision shall take effect only with the approval of both the board of directors and the commissioner, and may be made only to a corporation, association, or organization which extends protection not substantially less favorable and effective than that provided by sections 61B.18 to 61B.32.
61A.15 CONTRACT PROVISIONS.
All annuity contracts on a variable basis issued in this state shall stipulate the expense, mortality, and investment-increment factors to be used in computing (1) in the case of individual contracts, the dollar amount of variable benefits or other contractual payments or values, and (2) in the case of group contracts, the dollar amount payable with respect to a unit of variable benefits purchased thereunder. All such contracts shall guarantee that expenses shall not affect such dollar amounts adversely. In computing the dollar amount of variable benefits or other contractual payments or values under an individual contract on a variable basis, (a) the annual net investment increment assumption shall not exceed five percent, except with the approval of the commissioner, and (b) to the extent that the level of benefits may be affected by mortality results, the mortality factor shall be determined from the Annuity Mortality Table for 1949, Ultimate, or any modification of that table not having a higher mortality rate at any age, or, if approved by the commissioner, from another table. The term "expense," as used in this section, may exclude some or all taxes as stipulated in the contracts and may also exclude any investment management fee which is subject to change with the approval by vote of the holders of such contracts.
Any life insurance contract on a variable basis delivered or issued for delivery in this state shall stipulate the investment increment factor to be used in computing the dollar amount of variable benefits or other variable contractual payments or values thereunder and shall guarantee that expense and mortality results shall not adversely affect such dollar amounts.