North Dakota Administrative Code › Title 45 - Insurance, Commissioner of › Article 45-14 - Consumer Privacy › Chapter 45-14-01 - Privacy of Consumer Financial and Health Information › Section 45-14-01-04 - Definitions

Current through Supplement No. 393, July, 2024
As used in this chapter, unless the context requires
				  otherwise:
1. "Affiliate" means a company that controls, is controlled
				  by, or is under common control with another company.
2.
a."Clear and conspicuous" means that a notice is reasonably
understandable and designed to call attention to the nature
				  and significance of the information in the notice.
b. Examples:
(1) Reasonably understandable. A licensee makes its notice
				  reasonably understandable if it:
(a) Presents the information in the notice in clear, concise
				  sentences, paragraphs, and sections;
(b) Uses short explanatory sentences or bullet lists whenever
				  possible;
(c) Uses definite, concrete, everyday words and active voice
				  whenever possible;
(d) Avoids multiple negatives;
(e) Avoids legal and highly technical business terminology
				  whenever possible; and
(f) Avoids explanations that are imprecise and readily
				  subject to different interpretations.
(2) Designed to call attention. A licensee designs its notice
				  to call attention to the nature and significance of the information in it if
				  the licensee:
(a) Uses a plain-language heading to call attention to the
				  notice;
(b) Uses a typeface and type size that are easy to read;
(c) Provides wide margins and ample line spacing;
(d) Uses boldface or italics for key words; and
(e) In a form that combines the licensee's notice with other
				  information, uses distinctive type size, style, and graphic devices, such as
				  shading or sidebars.
(3) Notices on web sites. If a licensee provides a notice on
				  a web page, the licensee designs its notice to call attention to the nature and
				  significance of the information in it if the licensee uses text or visual cues
				  to encourage scrolling down the page if necessary to view the entire notice and
				  ensure that other elements on the web site such as text, graphics, hyperlinks,
				  or sound do not distract attention from the notice, and the licensee either:
(a) Places the notice on a screen that consumers frequently
				  access, such as a page on which transactions are conducted; or
(b) Places a link on a screen that consumers frequently
				  access, such as a page on which transactions are conducted, that connects
				  directly to the notice and is labeled appropriately to convey the importance,
				  nature, and relevance of the notice.
3. "Collect" means to obtain information that the licensee
				  organizes or can retrieve by the name of an individual or by identifying
				  number, symbol, or other identifying particular assigned to the individual,
				  irrespective of the source of the underlying information.
4. "Commissioner" means the insurance commissioner of the
				  state.
5. "Company" means a corporation, limited liability company,
				  business trust, general or limited partnership, association, sole
				  proprietorship, or similar organization.
6.
a."Consumer" means an individual who seeks to obtain,
				  obtains, or has obtained an insurance product or service from a licensee that
				  is to be used primarily for personal, family, or household purposes, and about
				  whom the licensee has nonpublic personal information, or that individual's
				  legal representative.
b. Examples:
(1) An individual who provides nonpublic personal information
				  to a licensee in connection with obtaining or seeking to obtain financial,
				  investment, or economic advisory services relating to an insurance product or
				  service is a consumer regardless of whether the licensee establishes an ongoing
				  advisory relationship.
(2) An applicant for insurance prior to the inception of
				  insurance coverage is a licensee's consumer.
(3) An individual who is a consumer of another financial
				  institution is not a licensee's consumer solely because the licensee is acting
				  as agent for, or provides processing or other services to, that financial
				  institution.
(4) An individual is a licensee's consumer if:
(a)
1.The individual is a beneficiary of a life insurance policy
				  underwritten by the licensee;
2 The individual is a claimant under an insurance policy
				  issued by the licensee;
3 The individual is an insured or an annuitant under an
				  insurance policy or an annuity, respectively, issued by the licensee; or
4 The individual is a mortgagor of a mortgage covered under a
				  mortgage insurance policy; and
(b) The licensee discloses nonpublic personal financial
				  information about the individual to a nonaffiliated third party other than as
				  permitted under sections
				  45-14-01-14,
				  45-14-01-15, and
				  45-14-01-16.
(5) Provided that the licensee provides the initial, annual,
				  and revised notices under sections
				  45-14-01-05,
				  45-14-01-06, and
				  45-14-01-09 to the plan sponsor,
				  group or blanket insurance policyholder, or group annuity contractholder, and
				  further provided that the licensee does not disclose to a nonaffiliated third
				  party nonpublic personal financial information about such an individual other
				  than as permitted under sections
				  45-14-01-14,
				  45-14-01-15, and
				  45-14-01-16, an individual is not
				  the consumer of the licensee solely because the individual is:
(a) A participant or a beneficiary of an employee benefit
				  plan that the licensee administers or sponsors or for which the licensee acts
				  as a trustee, insurer, or fiduciary; or
(b) Covered under a group or blanket insurance policy or
				  group annuity contract issued by the licensee.
(6)
(a) The individuals described in subparagraphs a and b of
				  paragraph 5 are consumers of a licensee if the licensee does not meet all the
				  conditions of paragraph 5.
(b) In no event shall the individuals, solely by virtue of
				  the status described in subparagraphs a and b of paragraph 5, be deemed to be
				  customers for purposes of this rule.
(7) An individual is not a licensee's consumer solely because
				  the individual is a beneficiary of a trust for which the licensee is a trustee.
(8) An individual is not a licensee's consumer solely because
				  the individual has designated the licensee as trustee for a trust.
7. "Consumer reporting agency" has the same meaning as in
				  section 603(f) of the federal Fair Credit Reporting Act [
				  15 U.S.C.
				  1681 a(f) ].
8. "Control" means:
a. Ownership, control, or power to vote twenty-five percent
				  or more of the outstanding shares of any class of voting security of the
				  company, directly or indirectly, or acting through one or more other persons;
b. Control in any manner over the election of a majority of
				  the directors, trustees, or general partners, or individuals exercising similar
				  functions, of the company; or
c. The power to exercise, directly or indirectly, a
				  controlling influence over the management or policies of the company, as the
				  commissioner determines.
9. "Customer" means a consumer who has a customer
				  relationship with a licensee.
10.
a."Customer relationship" means a continuing relationship
				  between a consumer and a licensee under which the licensee provides one or more
				  insurance products or services to the consumer that are to be used primarily
				  for personal, family, or household purposes.
b. Examples:
(1) A consumer has a continuing relationship with a licensee
				  if:
(a) The consumer is a current policyholder of an insurance
				  product issued by or through the licensee; or
(b) The consumer obtains financial, investment, or economic
				  advisory services relating to an insurance product or service from the licensee
				  for a fee.
(2) A consumer does not have a continuing relationship with a
				  licensee if:
(a) The consumer applies for insurance but does not purchase
				  the insurance;
(b) The licensee sells the consumer travel insurance in an
				  isolated transaction;
(c) The individual is no longer a current policyholder of an
				  insurance product or no longer obtains insurance services with or through the
				  licensee;
(d) The consumer is a beneficiary or claimant under a policy
				  and has submitted a claim under a policy choosing a settlement option involving
				  an ongoing relationship with the licensee;
(e) The consumer is a beneficiary or a claimant under a
				  policy and has submitted a claim under that policy choosing a lump sum
				  settlement option;
(f) The customer's policy is lapsed, expired, or otherwise
				  inactive or dormant under the licensee's business practices, and the licensee
				  has not communicated with the customer about the relationship for a period of
				  twelve consecutive months, other than annual privacy notices, material required
				  by law or regulation, communication at the direction of a state or federal
				  authority, or promotional materials;
(g) The individual is an insured or an annuitant under an
				  insurance policy or annuity, respectively, but is not the policyholder or owner
				  of the insurance policy or annuity; or
(h) For the purposes of this chapter, the individual's
				  last-known address according to the licensee's records is deemed invalid. An
				  address of record is deemed invalid if mail sent to that address by the
				  licensee has been returned by the postal authorities as undeliverable and if
				  subsequent attempts by the licensee to obtain a current valid address for the
				  individual have been unsuccessful.
11.
a."Financial institution" means any institution the business
				  of which is engaging in activities that are financial in nature or incidental
				  to such financial activities as described in section 4(k) of the Bank Holding
				  Company Act of 1956 [ 12
				  U.S.C. 1843(k) ].
b. Financial institution does not include:
(1) Any person or entity with respect to any financial
				  activity that is subject to the jurisdiction of the commodity futures trading
				  commission under the Commodity Exchange Act [U.S.C. 1 etseq.];
(2) The federal agricultural mortgage corporation or any
				  entity charged and operating under the Farm Credit Act of 1971 [
				  12 U.S.C.
				  2001 etseq.]; or
(3) Institutions chartered by Congress specifically to engage
				  in securitizations, secondary market sales, including sales of servicing
				  rights, or similar transactions related to a transaction of a consumer, as long
				  as the institutions do not sell or transfer nonpublic personal information to a
				  nonaffiliated third party.
12.
a. "Financial product or service" means a product or service
				  that a financial holding company could offer by engaging in an activity that is
				  financial in nature or incidental to such a financial activity under section
				  4(k) of the Bank Holding Company Act of 1956 [
				  12 U.S.C.
				  1843(k) ].
b. Financial service includes a financial institution's
				  evaluation or brokerage of information that the financial institution collects
				  in connection with a request or an application from a consumer for a financial
				  product or service.
13. "Health care" means:
a. Preventive, diagnostic, therapeutic, rehabilitative,
				  maintenance or palliative care, services, procedures, tests, or counseling
				  that:
(1) Relates to the physical, mental, or behavioral condition
				  of an individual; or
(2) Affects the structure or function of the human body or
				  any part of the human body, including the banking of blood, sperm, organs, or
				  any other tissue; or
b. Prescribing, dispensing, or furnishing to an individual
				  drugs or biologicals, or medical devices or health care equipment and supplies.
14. "Health care provider" means a physician or other health
				  care practitioner licensed, accredited, or certified to perform specified
				  health services consistent with state law, or a health care facility.
15. "Health information" means any information or data except
				  age or gender, whether oral or recorded in any form or medium, created by or
				  derived from a health care provider or the consumer that relates to:
a. The past, present, or future physical, mental, or
				  behavioral health or condition of an individual;
b. The provision of health care to an individual; or
c. Payment for the provision of health care to an individual.
16.
a."Insurance product or service" means any product or service
				  that is offered by a licensee pursuant to the insurance laws of this state.
b. Insurance service includes a licensee's evaluation,
				  brokerage, or distribution of information that the licensee collects in
				  connection with a request or an application from a consumer for an insurance
				  product or service.
17.
a."Licensee" means all licensed insurers, producers, and
				  other persons licensed or required to be licensed, or authorized or required to
				  be authorized, or registered or required to be registered pursuant to the
				  insurance law of this state and health maintenance organizations holding a
				  certificate of authority pursuant to North Dakota Century Code chapter
				  26.1-18.1. As used herein, the term "licensee" does not include either of the
				  following:
(1) North Dakota life and health insurance guaranty
				  association created pursuant to North Dakota Century Code chapter 26.1-38; or
(2) North Dakota insurance guaranty association created
				  pursuant to North Dakota Century Code chapter 26.1-42.1.
b. A licensee is not subject to the notice and authorization
				  requirements for nonpublic personal financial information set forth in this
				  chapter if the licensee is an employee, agent, or other representative of
				  another licensee ("the principal") and:
(1) The principal otherwise complies with, and provides the
				  notices required by, the provisions of this chapter; and
(2) The licensee does not disclose any nonpublic personal
				  information to any person other than the principal or its affiliates unless in
				  a manner permitted by this chapter.
c.
(1) Subject to paragraph 2, "licensee" also includes an
				  unauthorized insurer that accepts business placed through a licensed excess
				  lines broker in this state, but only in regard to the excess lines placements
				  placed pursuant to North Dakota Century Code chapter 26.1-44.
(2) An excess lines broker or excess lines insurer shall be
				  deemed to be in compliance with the notice and authorization requirements for
				  nonpublic personal financial information set forth in this rule provided:
(a) The broker or insurer does not disclose nonpublic
				  personal information of a consumer or a customer to nonaffiliated third parties
				  for any purpose, including joint servicing or marketing under section
				  45-14-01-14, except as permitted
				  by section
				  45-14-01-15 or
				  45-14-01-16; and
(b) The broker or insurer delivers a notice to the consumer
				  at the time a customer relationship is established on which the following is
				  printed in sixteen-point type:
PRIVACY NOTICE
"Neither the U.S. brokers that handled this insurance nor
				  the insurers that have underwritten this insurance will disclose nonpublic
				  personal information concerning the buyer to nonaffiliates of the brokers or
				  insurers except as permitted by law."
18.
a."Nonaffiliated third party" means any person except:
(1) A licensee's affiliate; or
(2) A person employed jointly by a licensee and any company
				  that is not the licensee's affiliate, but nonaffiliated third party includes
				  the other company that jointly employs the person.
b. Nonaffiliated third party includes any company that is an
				  affiliate solely by virtue of the direct or indirect ownership or control of
				  the company by the licensee or its affiliate in conducting merchant banking or
				  investment banking activities of the type described in section 4(k)(4)(H) or
				  insurance company investment activities of the type described in section
				  4(k)(4)(l) of the federal Bank Holding Company Act [
				  12 U.S.C.
				  1843(k)(4)(H) and (I) ].
19. "Nonpublic personal information" means nonpublic personal
				  financial information and nonpublic personal health information.
20.
a. "Nonpublic personal financial information" means:
(1) Personally identifiable financial information; and
(2) Any list, description, or other grouping of consumers,
				  and publicly available information pertaining to them, that is derived using
				  any personally identifiable financial information that is not publicly
				  available.
b. Nonpublic personal financial information does not include:
(1) Health information;
(2) Publicly available information, except as included on a
				  list described in paragraph 2 of subsection a; or
(3) Any list, description, or other grouping of consumers,
				  and publicly available information pertaining to them, that is derived without
				  using any personally identifiable financial information that is not publicly
				  available.
c. Examples of lists:
(1) Nonpublic personal financial information includes any
				  list of individuals' names and street addresses that is derived in whole or in
				  part using personally identifiable financial information that is not publicly
				  available, such as account numbers.
(2) Nonpublic personal financial information does not include
				  any list of individuals' names and addresses that contains only publicly
				  available information, is not derived in whole or in part using personally
				  identifiable financial information that is not publicly available, and is not
				  disclosed in a manner that indicates that any of the individuals on the list is
				  a consumer of a financial institution.
21. "Nonpublic personal health information" means health
				  information:
a. That identifies an individual who is the subject of the
				  information; or
b. With respect to which there is a reasonable basis to
				  believe that the information could be used to identify an individual.
22.
a. "Personally identifiable financial information" means any
				  information:
(1) A consumer provides to a licensee to obtain an insurance
				  product or service from the licensee;
(2) About a consumer resulting from a transaction involving
				  an insurance product or service between a licensee and a consumer; or
(3) The licensee otherwise obtains about a consumer in
				  connection with providing an insurance product or service to that consumer.
b. Examples:
(1) Information included. Personally identifiable financial
				  information includes:
(a) Information a consumer provides to a licensee on an
				  application to obtain an insurance product or service;
(b) Account balance information and payment history;
(c) The fact that an individual is or has been one of the
				  licensee's customers or has obtained an insurance product or service from the
				  licensee;
(d) Any information about the licensee's consumer if it is
				  disclosed in a manner that indicates that the individual is or has been the
				  licensee's consumer;
(e) Any information that a consumer provides to a licensee or
				  that the licensee or its agent otherwise obtains in connection with collecting
				  on a loan or servicing a loan;
(f) Any information the licensee collects through an internet
				  cookie, an information-collecting device from a web server; and
(g) Information from a consumer report.
(2) Information not included. Personally identifiable
				  financial information does not include:
(a) Health information;
(b) A list of names and addresses of customers of an entity
				  that is not a financial institution; and
(c) Information that does not identify a consumer, such as
				  aggregate information or blind data that does not contain personal identifiers
				  such as account numbers, names, or addresses.
23.
a. "Publicly available information" means any information
				  that a licensee has a reasonable basis to believe is lawfully made available to
				  the general public from:
(1) Federal, state, or local government records;
(2) Widely distributed media; or
(3) Disclosures to the general public which are required to
				  be made by federal, state, or local law.
b. Reasonable basis. A licensee has a reasonable basis to
				  believe that information is lawfully made available to the general public if
				  the licensee has taken steps to determine:
(1) That the information is of the type that is available to
				  the general public; and
(2) Whether an individual can direct that the information not
				  be made available to the general public and, if so, that the licensee's
				  consumer has not done so.
c. Examples:
(1) Government records. Publicly available information in
				  government records includes information in government real estate records and
				  security interest filings.
(2) Widely distributed media. Publicly available information
				  from widely distributed media includes information from a telephone book, a
				  television or radio program, a newspaper, or a web site that is available to
				  the general public on an unrestricted basis. A web site is not restricted
				  merely because an internet service provider or a site operator requires a fee
				  or a password, so long as access is available to the general public.
(3) Reasonable basis.
(a) A licensee has a reasonable basis to believe that
				  mortgage information is lawfully made available to the general public if the
				  licensee has determined that the information is of the type included on the
				  public record in the jurisdiction where the mortgage would be recorded.
(b) A licensee has a reasonable basis to believe that an
				  individual's telephone number is lawfully made available to the general public
				  if the licensee has located the telephone number in the telephone book or the
				  consumer has informed the licensee that the telephone number is not unlisted.
General Authority: NDCC 28-32-02
Law Implemented: NDCC
					 26.1-02-27