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28 TAC 1.1.E.1.601
Texas
Regulation provided by StateNet
DOCUMENT NUMBER: SN002067
VERSION NUMBER: 1.000
PUBLICATION DATE: 01/20/2007 06:00 AM
TABLE OF CONTENTS
CITATION
28 TAC 1.1.E.1.601
STATUS
This regulation was assigned the status of Adopted Rule Notice
on 01/02/2007.
Agency: Department of Insurance
StateNet Processing Date: 01/19/2007
StateNet Regulation ID: 2006 TX 10484
ADOPTED TEXT
TITLE 28. INSURANCE
Part 1. TEXAS DEPARTMENT OF INSURANCE
Chapter 1. GENERAL ADMINISTRATION
Subchapter E. NOTICE OF TOLL-FREE TELEPHONE NUMBERS AND PROCEDURES FOR
OBTAINING INFORMATION AND FILING COMPLAINTS
28 TAC Section 1.601
The Commissioner of Insurance adopts amendments to Section 1.601,
concerning the appropriate wording for a notice insurers and health
maintenance organizations must deliver to consumers with each insurance
policy, certificate, or evidence of coverage issued or renewed in the State of
Texas. The amendments are adopted with changes to the proposed text published
in the September 22, 2006 issue of the Texas Register (31 TexReg 8074).
Currently, the notice required by Section 1.601 only includes the Texas
Department of Insurance's mailing address and telephone number. The adopted
amendments require that the notice include the Department's internet and
e-mail addresses. The adopted amendments also make minor formatting changes to
the notice, update obsolete statutory citations in subsection (a) as a result
of the legislative enactment of the nonsubstantive Insurance Code revision,
and delete subsection (e). Adding the Department's internet and e-mail
addresses to the notice increases awareness of additional and useful methods
of communication the public can use to contact the Department in order to make
inquiries, file complaints, or gather more information about insurance topics
of interest. By using the internet, consumers can have access to valuable
information at any time, including much of the information that Insurance Code
Section 521.052 requires the Department to provide, including: information
collected and maintained by the Department relating to the number and
disposition of complaints against an insurer, the kinds of coverage available
to a consumer through any insurer writing insurance in this state, an
insurer's admitted assets-to-liabilities ratio, and other appropriate
information collected and maintained by the Department. Also, e-mail allows
Texas consumers to send inquiries or file complaints with the Department at
their convenience.
The Department's website was first published on January 23, 1997. In the
agency's first year online, the website received 457,635 page hits. By 2005,
the number of page hits increased by 57 times to 26,174,884. The astronomical
growth in page hits indicates that more and more consumers are taking
advantage of the convenience of electronic communication.
Because Section 1.601 was adopted and last amended before internet
communication was common, the current notice requirement does not include the
Department's internet or e-mail addresses. Today, as the Department's
statistics suggest, internet use is becoming a preferred medium for sharing
information. It is also a valuable tool for consumers that makes government
more accessible; therefore, it is reasonable and necessary to notify
policyholders of the Department's online presence.
The amended notice makes minor formatting changes: a colon and period have
been added where appropriate, "FAX #" is replaced by "Fax:" to be consistent
with the formatting of "E-mail:" and "Web:" in Item 6, and spacing is adjusted
to ensure that the form will fit on a single page.
The adopted amendments also update statutory references in subsection (a).
Articles 21.71, 1.35, and 1.35D were repealed by Acts 2003, 78th Legislature,
Chapter 1274, Section 2, effective April 1, 2005, and were re-adopted as
Sections 521.103, 521.005, and 521.056, respectively, in the same
non-substantive Insurance Code revision.
The final adopted amendment deletes subsection (e), which addresses the
use of existing inventories of preprinted forms because it is outdated. The
subsection only applied to circumstances that could have existed prior to
September 1, 1992. Therefore, subsection (e) is no longer necessary. Existing
subsections (f) and (g) have been re-designated accordingly.
The Department has changed some of the language in the text of the rule as
proposed. The changes, however, do not introduce new subject matter or affect
persons in addition to those subject to the proposal as published. The changes
are as follows. A minor spelling error has been corrected; "telephono" has
been replaced by "telefono". The references to old mail codes in Section
1.601(c)(2)(A) has been replaced with new mail codes. The Department has also
changed the proposed effective date from January 1, 2007, to July 1, 2007, in
order to allow insurers to make use of existing inventories and switch to the
amended notice when the timing is most appropriate. A new subsection (g) has
been added to state the new effective date. Existing notices printed according
to the requirements in current Section 1.601 may be used through June 30,
2007. New notices can be produced in the regular course of business for use on
or before July 1, 2007.
The adopted amendments to Section 1.601(a)(1) update obsolete statutory
citations as a result of the legislative enactment of the nonsubstantive
Insurance Code revision. The adopted amendments to the notice required by
Section 1.601(a)(3) adds the Department's internet and e-mail addresses and
makes minor formatting changes to the notice. Because Section 1.601(e) was
deleted, subsections (f) and (g) have been re-designated accordingly and
adopted as Section 1.601(e) and Section 1.601(f) respectively. Section
1.601(g) provides an effective date for the amendments of July 1, 2007.
The Department did not receive any comments on the proposed amendments.
The amendments are adopted under the Insurance Code, Sections 521.005,
521.103, 521.101, 1271.054, 1271.101, 843.151, and 36.001. Under Section
521.005(a), each insurance policy delivered or issued for delivery in this
state must include with the policy a brief written notice that includes a
suggested policyholder dispute procedure, the Department's name and address,
and the Department's toll-free number. Under Section 521.005(b), the
Commissioner is specifically charged with adopting the appropriate wording for
the notice. The Commissioner is also authorized by Section 521.103(b) to adopt
rules governing the manner in which an insurer's or HMO's toll-free telephone
number appears on the insurance policy or evidence of coverage. Section
521.101 provides that the Insurance Code, Chapter 521, Subchapter C (Health
Maintenance Organization or Insurer Toll-free Number for Information and
Complaints) applies to a health maintenance organization authorized to engage
in the business of a health maintenance organization in this state or an
insurer organized to engage in the business of insurance in this state.
Section 1271.054 requires that an evidence of coverage contain a clear and
understandable description of the HMO's methods for resolving enrollee
complaints. Section 1271.101(a) provides that an evidence of coverage or an
amendment of an evidence of coverage may not be issued or delivered to a
person in this state until the form of the evidence of coverage or amendment
has been filed with and approved by the Commissioner. Section 843.151
authorizes the Commissioner to adopt reasonable rules as necessary and proper
to implement Chapter 843 (Health Maintenance Organizations). Section 36.001
provides that the Commissioner of Insurance may adopt any rules necessary and
appropriate to implement the powers and duties of the Texas Department of
Insurance under the Insurance Code and other laws of this state.
Section 1.601. Notice of Toll-Free Telephone Numbers and Information and
Complaint Procedures.
(a) Purpose and applicability.
(1) The purpose of this section is to provide the means by which insurers
and health maintenance organizations (HMOs) may comply with the notice
requirements of the Insurance Code Section 521.103, and the means by which
insurers may comply with the notice requirements of the Insurance Code Section
521.005 and Section 521.056. Compliance with this section is deemed compliance
with these notice requirements.
(2) Except as provided by subsection (b)(3), this section applies to any
new or renewal insurance policy, bond, annuity contract, subscriber contract,
health care plan, certificate, and evidence of coverage issued for delivery in
this state on or after May 1, 1992.
(3) All policies, certificates, or evidences of coverage which are
delivered, issued for delivery, or renewed in the State of Texas on or after
May 1, 1992, by insurers or HMOs shall have the notice included as the first,
second, or third page of the policy, certificate, evidence of coverage, or
first written communication indicating renewal of coverage, pursuant to the
provisions of subsection (b) of this section. The notice must appear on a
full, separate page with no text other than that provided in this section.
The form of the notice shall be as provided by subsection (b) of this section.
The item numbers 1 - 8 in the left-hand column of this form correspond to the
respective paragraphs of subsection (b) of this section, and the item numbers
may be omitted from the notice.
Figure: 28 TAC Section 1.601(a)(3)
1 IMPORTANT NOTICE AVISO IMPORTANTE
To obtain information or make a Para obtener informacion o para
complaint: someter una queja:
2 You may contact your (title) at Puede comunicarse con su (title) al
(telephone number). (telephone number).
3 You may call (company)'s toll-free Usted puede llamar al numero de
telephone number for information or telefono gratis de (company)'s para
to make a complaint at: informacion o para someter una queja
al:
1-XXX-XXX-XXXX 1-XXX-XXX-XXXX
4 You may also write to (company) at: Usted tambien puede escribir a
(company):
5 You may contact the Texas Department Puede comunicarse con el Departamento
of Insurance to obtain information on de Seguros de Texas para obtener
companies, coverages, rights or informacion acerca de companias,
complaints at: coberturas, derechos o quejas al:
1-800-252-3439 1-800-252-3439
6 You may write the Texas Department Puede escribir al Departamento de
of Texas: Seguros de Insurance:
P.O. Box 149104 P.O. Box 149104
Austin, TX 78714-9104 Austin, TX 78714-9104
Fax: (512) 475-1771 Fax: (512) 475-1771
Web: http://www.tdi.state.tx.us Web: http://www.tdi.state.tx.us
E-mail: E-mail:
ConsumerProtection@tdi.state.tx.us ConsumerProtection@tdi.state.tx.us
7 PREMIUM OR CLAIM DISPUTES: DISPUTAS SOBRE PRIMAS O RECLAMOS:
Should you have a dispute concerning Si tiene una disputa concerniente a su
your premium or about a claim you prima o a un reclamo, debe comunicarse
should contact the (agent) (company) con el (agente) (la compania) (agente
(agent or the company) first. If the o la compania) primero. Si no se
dispute is not resolved, you may resuelve la disputa, puede entonces
contact the Texas Department of comunicarse con el departamento (TDI).
Insurance.
8 ATTACH THIS NOTICE TO YOUR POLICY: UNA ESTE AVISO A SU POLIZA:
This notice is for information only Este aviso es solo para proposito de
and does not become a part or informacion y no se convierte en parte
condition of the attached document. o condicion del documento adjunto.
(b) Notice requirements. Each respectively numbered item in the notice
provided in subsection (a)(3) of this section must be set out as provided in
this subsection. There must be at least one blank line between each item, but
the text within each item may be single-spaced. The Spanish portion of each
item included in a company's notice is required only for personal automobile,
homeowners, and life, accident and health policies, certificates, and
evidences of coverage. Text shall be in at least 10-point type. The letterhead
of the insurer or HMO and any automated form identification numbers may be
included on the notice.
(1) Item 1 must be included in all notices. "Important Notice" and "Aviso
Importante" must be in all capital letters and in at least 10-point boldface
type. There must be at least one blank line below "Important Notice" and
"Aviso Importante."
(2) Item 2 is optional. The title for the English portion may be either
"agent," "third party administrator," "managing general agent," or "employee
benefits coordinator." The title for the Spanish portion may be either
"agente," "administrador tercero," "agente general," or "administrador de
beneficios para empleados." In lieu of a specific telephone number, the
insurer or HMO may refer to the applicable telephone number and where it can
be found.
(3) Item 3 is required unless one of the exemptions provided in this
subsection applies. For purposes of this section a toll-free telephone number
is one which can be used by any covered person to obtain information or make a
complaint without incurring long-distance calling expenses. The insurer's or
HMO's toll-free number must appear in at least 10-point boldface type and must
be preceded and followed by one blank line. Item 3 is not required for an
insurer or HMO:
(A) whose gross initial premium receipts collected in this state are less
than $2 million a year;
(B) with respect to fidelity, surety, or guaranty bonds;
(C) that is a surplus lines insurer; or
(D) with respect to certificates of insurance issued under a group policy:
(i) if the insurer does not administer the group policy or determine
questions of coverage; or
(ii) if the policyholder to whom the policy is issued is an employer or a
labor union.
(4) Item 4 is optional. If used, the insurer's or HMO's name and address
must be inserted.
(5) Item 5 is required on all notices. The toll-free number must be in at
least 10-point boldface type and must be preceded and followed by one blank
line.
(6) Item 6 is required on all notices.
(7) Item 7 is required on all notices except those notices provided by
HMOs with evidences of coverage. "Premium or claim disputes" and "Disputas
sobre primas o reclamos" must be in all capital letters and 10-point boldface
type. The insurer may insert either "agent," "company," or "agent or company"
and may insert either "el agente," "la compania," or "el agente o la
compania."
(8) Item 8 is required on all notices. "Attach this notice to your policy"
and "Una este aviso a su poliza" must be in all capital letters and 10-point
boldface type.
(c) Exceptions to notice requirements for insurer's toll-free number.
(1) Requirements. Any exception claimed pursuant to subsection (b)(3)(A)
of this section for a policy, certificate, or evidence of coverage delivered,
issued for delivery, or renewed in a given year must be based on gross initial
premium receipts collected in Texas during the previous calendar year. Any
insurer or health maintenance organization claiming an exception must provide
to the Texas Department of Insurance, at a minimum, the following information:
(A) a statement reciting the statutory basis for the exception;
(B) a statement detailing the amount of gross initial premium receipts
collected in this state for the calendar year immediately preceding the
calendar year for which an exception is claimed; and
(C) an affirmation by the chief executive officer or chief financial
officer of the insurer or health maintenance organization certifying that he
or she has reviewed the information and that such filed information is true,
accurate, and complete, based upon that person's best knowledge, information,
and belief.
(2) Procedure. This statement must be filed separately from all other
forms and exception statements filed with respect to other matters pending
before the department. Claims for exception must be addressed to the
appropriate regulatory division within the department.
(A) Mail codes for the respective divisions are as follows:
(i) Life, Accident, and Health 106-1A;
(ii) Property and Casualty (including Workers' Compensation) 104-3B;
(iii) Title 106-2T;
(iv) Risk Retention Groups 305-2C;
(v) HMO 106-1E.
(B) Exception statements should be filed with the Texas Department of
Insurance, (Name of Division), (Mail Code #), P.O. Box 149104, Austin, Texas
78714-9104.
(3) Duration of exception. Exceptions remain in effect for one year. The
information required by paragraph (1) of this subsection must be provided to
the department no later than May 1, 1992, for calendar year 1992, and no later
than March 15 of any subsequent year for which an exception is claimed.
(4) Policy and form filings. When an insurer or health maintenance
organization files a policy form or evidence of coverage with the department
for information or review, any exception to the requirements of this section
pertaining to the insurer's toll-free telephone number must be noted in the
filing. If a prior exception has not been granted, the documentation required
by paragraph (1) of this subsection must be filed.
(5) Records maintenance. Except as specifically provided in subparagraphs
(A) and (B) of this paragraph, beginning with calendar year 1993, any insurer
or health maintenance organization claiming an exception must maintain a
system by which information pertaining to receipt of initial premiums is
tracked on a calendar year basis. This information shall include for each new
policy written during a calendar year the following: the policy number; the
effective date of the policy; and the amount of initial premium received,
including any membership fees, assessments, dues, and any other considerations
for such insurance. Such information and any other data upon which the company
relied in making the determination that it was entitled to the exception shall
be made available to the department upon request and is subject to examination
by the department. Failure by any insurer or HMO to maintain the information
required in this paragraph or to provide such information to the department
upon request constitutes grounds for disciplinary action which may result in
the cancellation, revocation, or suspension of such insurer's or HMO's
certificate of authority.
(A) Any insurer or HMO which is authorized to write business in Texas and
which claims an exception to the maintenance of a toll-free telephone number
for a calendar year is not required to maintain information pertaining to
initial premium receipts as set out in this paragraph in order to claim the
exception if the exception is based on the criteria set out in any of clauses
(i) - (iv) of this subparagraph, as follows:
(i) such insurer or HMO claims the exception based on receipt of gross
premiums of less than $2 million for the prior calendar year for business
written in this state, as reported on its annual statement;
(ii) such insurer or HMO claims the exception based on receipt of gross
first-year premiums of less than $2 million for the prior calendar year for
all business, as reported on its annual statement;
(iii) such insurer or HMO writes business only in Texas and claims the
exception based on receipt of gross first-year premiums of less than $2
million for the prior calendar year, as reported on its annual statement; or
(iv) such insurer or HMO claims the exception based on receipt of gross
initial first-year premiums of less than $2 million for business written in
Texas, as reported on its annual statement.
(B) Any insurer or HMO which is authorized to write business in Texas, but
which does not meet the criteria of subparagraph (A) of this paragraph and
which claims an exception based on receipt of gross first-year premiums of
less than $2 million for business written in this state must maintain a system
by which information pertaining to receipt of first-year premiums for Texas
business is tracked on a calendar year basis. This information shall include
for each new policy written during a calendar year the following: the policy
number; effective date of the policy; and amount of the first-year premium
received, including any membership fees, assessments, dues, and any other
considerations for such insurance.
(d) Policies in force prior to May 1, 1992, and renewed on or after May 1,
1992. The notice required to be provided by this section shall be provided
with the first premium notice, or other communication indicating renewal of
the coverage mailed or delivered after May 1, 1992.
(1) For all policies, certificates or evidences of coverage in force prior
to May 1, 1992, and renewed by any insurer or health maintenance organization
on or after May 1, 1992, the notice required to be provided by this section
shall either be mailed or be personally delivered to the policyholder,
certificate holder, or enrollee, except as provided by paragraph (2) of this
subsection.
(2) For all group policies in force prior to May 1, 1992, and renewed by
any insurer or health maintenance organization on or after May 1, 1992, the
notice required to be provided by this section may be provided to the group
policyholder for delivery to each certificate holder or enrollee under the
group policy, or it may be mailed directly to each certificate holder or
enrollee by the insurer or health maintenance organization.
(e) Policies, bonds, annuity contracts, and certificates. Policies, bonds,
annuity contracts, and certificates subject to the provisions of this section
which required prior approval and were approved or filed prior to May 1, 1992,
may be delivered or issued for delivery with the notice required by this
section without refiling for approval.
(f) Additions to group coverage. When an individual is added as a
certificate holder, annuitant, or enrollee to a policy or plan issued,
delivered, or renewed on or after May 1, 1992, the notice required by this
section must be included as the first, second, or third page of the
certificate, annuity contract, or evidence of coverage.
(g) These amendments are effective July 1, 2007.
This agency hereby certifies that the adoption has been reviewed by legal
counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of the Secretary of State on January 2, 2007.
TRD-200700001
Gene C. Jarmon
General Counsel and Chief Clerk
Texas Department of Insurance
Effective date: January 22, 2007
Proposal publication date: September 22, 2006
For further information, please call: (512) 463-6327
WHAT'S NEW
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