California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 9 - Insurance Fraud › Article 2 - Special Investigative Unit › Section 2698.33 - SIU and Integral Anti-Fraud Personnel Contracted Responsibilities

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Any contract
				  entered into by an insurer, or an entity under contract with an insurer for the
				  performance of SIU or integral anti-fraud personnel duties or functions as
				  provided under these regulations, shall not relieve the insurer of any
				  obligation under these regulations or the IFPA.
(b) Notwithstanding any other provisions of
				  these regulations, a complete and executed copy of any such agreement,
				  including all attachments, exhibits and amendments thereto, shall be provided
				  to the Fraud Division upon request by the Fraud Division.
(c) Any contract entered into by an insurer
				  with a contracted entity under this section shall:
(1) Specify all SIU or integral anti-fraud
				  personnel duties and functions to be performed by the parties to the contract
				  and how the insurer monitors performance of the contract
				  responsibilities;
(2) Not include
				  provisions that could provide disincentives to the referral and/or
				  investigation of suspected insurance fraud;
(3) Not include provisions that purport to
				  relieve an insurer of any obligation to comply with the requirements of these
				  regulations and the IFPA;
(4)
				  Expressly require the contracted entity to comply with all applicable
				  provisions of the IFPA and this article; and
(5) Expressly require the contracted entity
				  to include the following provisions in any agreement the contracted entity may
				  enter into with any subcontractor to perform SIU or integral anti-fraud
				  personnel duties or functions for the contracted entity on behalf of the
				  insurer:
(A) Subcontractor to provide entire
				  agreement to the Fraud Division upon request: An express provision requiring
				  that the contractor provide to the Fraud Division a complete and executed copy
				  of any such agreement between the contractor and its subcontractor, including
				  all attachments, exhibits and amendments thereto, upon request by the Fraud
				  Division,
(B) Subcontractor to be
				  bound by same requirements as contractor: An express provision that any such
				  agreement between the contractor and its subcontractor shall conform to the
				  requirements set forth in subdivisions (c)(1), (c)(2), (c)(3), and (c)(4) of
				  this Section
				  2698.33, and
(C) Limitations on subcontractor contracting
				  with other entities: An express provision that, in the event any subcontractor
				  to the contracted entity contracts with any other entity or entities to perform
				  SIU or integral anti-fraud personnel duties or functions on behalf of the
				  insurer, the agreement between the subcontractor and the entity so contracted
				  (hereinafter a "sub-subcontractor") shall contain the following provisions:
1. Sub-subcontractor to be bound by same
				  requirements as contractor and subcontractor: The express provision described
				  in subdivision (c)(5)(B) of this section,
2. Sub-subcontractor to provide entire
				  agreement to the Fraud Division upon request: An express provision identical in
				  substance to the provision described in subdivision (c)(5)(A) of this section,
				  binding the subcontractor to provide, upon request by the Fraud Division, the
				  documents specified in that subdivision (c)(5)(A) but with respect to the
				  agreement between the subcontractor and its sub-subcontractor, and
3. No further subcontracting: An express
				  provision prohibiting the sub-subcontractor from permitting, or contracting
				  with, any other entity to perform the SIU or integral anti-fraud personnel
				  duties or functions which the sub-subcontractor has contracted with the
				  subcontractor to perform on behalf of the
				  insurer.