2023 Utah Code › Title 31A - Insurance Code › Chapter 4 - Insurers in General › Section 115 - Plan of orderly withdrawal.

Effective 5/4/2022
31A-4-115.
Plan of orderly withdrawal.
(1) As used in this section, a "line of insurance" means:
(a) a general line of authority;
(b) a general line of insurance;
(c) a limited line insurance;
(d) the small employer group health benefit plan market when there is a discontinuance of all small employer health benefit plans under Subsection 31A-22-618.6(5)(e);
(e) the large employer group health benefit market when there is a discontinuance of all large employer health benefit plans under Subsection 31A-22-618.6(5)(e); or
(f) the individual health benefit plan market when there is a discontinuance of all individual health benefit plans under Subsection 31A-22-618.7(3)(e).
(2) When an insurer intends to withdraw from writing a line of insurance in this state or to reduce its total annual premium volume by 75% or more, the insurer shall file with the commissioner a plan of orderly withdrawal.
(3) An insurer's plan of orderly withdrawal shall:
(a) indicate the date the insurer intends to:
(i) begin the withdrawal plan; and
(ii) complete the withdrawal plan; and
(b) include provisions for:
(i) meeting the insurer's contractual obligations;
(ii) providing services to the insurer's Utah policyholders and claimants;
(iii) meeting applicable statutory obligations; and
(iv) the payment of a withdrawal fee of $50,000 to the department if the insurer's line of insurance is not assumed or placed with another insurer approved by the commissioner.
(4) The commissioner shall approve a plan of orderly withdrawal if the plan of orderly withdrawal adequately demonstrates that the insurer will:
(a) protect the interests of the people of the state;
(b) meet the insurer's contractual obligations;
(c) provide service to the insurer's Utah policyholders and claimants; and
(d) meet applicable statutory obligations.
(5) Section 31A-2-302 governs the commissioner's approval or disapproval of a plan for orderly withdrawal.
(6) The commissioner may require an insurer to increase the deposit maintained in accordance with Section 31A-4-105 or Section 31A-4-105.5 and place the deposit in trust in the name of the commissioner upon finding, after an adjudicative proceeding that:
(a) there is reasonable cause to conclude that the interests of the people of the state are best served by such action; and
(b) the insurer:
(i) has filed a plan of orderly withdrawal; or
(ii) intends to:
(A) withdraw from writing a line of insurance in this state; or
(B) reduce the insurer's total annual premium volume by 75% or more.
(7) An insurer is subject to the civil penalties under Section 31A-2-308, if the insurer:
(a) withdraws from writing a line of insurance in this state without receiving the commissioner's approval of a plan of orderly withdrawal; or
(b) reduces the insurer's total annual premium volume by 75% or more in any year without receiving the commissioner's approval of a plan of orderly withdrawal.
(8) An insurer that withdraws from writing a line of insurance in this state may not resume writing the line of insurance in this state for five years unless the commissioner finds that the prohibition should be waived because the waiver is:
(a) in the public interest to promote competition; or
(b) to resolve inequity in the marketplace.
(9) The commissioner shall adopt rules necessary to implement this section.
(10) This section does not apply to an insurer that places coverage with an affiliate of the insurer with the same or similar coverage.
Amended by Chapter 198, 2022 General Session