Current Status Introducing Body:
HouseBill Number: 4250Primary Sponsor: T.C. AlexanderType of Legislation: JRSubject: Reinsurance Facility, auditResiding Body: HouseDate Tabled: 19930601Computer Document Number: BBM/10636JM.93Introduced Date: 19930527Last History Body: HouseLast History Date: 19930601Last History Type: TabledScope of Legislation: StatewideAll Sponsors: T.C. Alexander J. Bailey Elliott Richardson Cato R. Smith HarvinType of Legislation: Joint Resolution
Bill Body Date Action Description CMN Leg Involved ____ ______ ____________ ______________________________ ___ ____________ 4250 House 19930601 Tabled 4250 House 19930527 Introduced, read first time, placed on Calendar without referenceView additional legislative information at the LPITS web site.
May 27, 1993
Introduced by REPS. T.C. Alexander, J. Bailey, Elliott, Richardson, Cato, R. Smith and Harvin
S. Printed 5/27/93--H.
Read the first time May 27, 1993.
TO PROVIDE FOR AN INDEPENDENT AUDIT OF EACH MEMBER INSURER OF THE SOUTH CAROLINA REINSURANCE FACILITY; TO PROVIDE THAT A REPORT OF FINDINGS BE PERFORMED JOINTLY BY THE CHIEF INSURANCE COMMISSIONER, THE HOUSE LABOR, COMMERCE AND INDUSTRY COMMITTEE, AND THE SENATE BANKING AND INSURANCE COMMITTEE; TO PROVIDE FOR THE DISSEMINATION OF THIS INDEPENDENT AUDIT TO THE GENERAL ASSEMBLY; AND TO PROVIDE THAT THE PROVISIONS OF R.136 OF 1993, RELATING TO, AMONG OTHER THINGS, SOLICITING AN INVITATION FOR BIDS FOR SERVICES USED OR PAID FOR BY THE REINSURANCE FACILITY, TERMINATION OF CERTAIN CONTRACTS, AND CONDUCTING CERTAIN AUDITS, SHALL BE IMPLEMENTED BY THE CHIEF INSURANCE COMMISSIONER IN A TIMELY MANNER SO AS TO ENSURE THE EFFICIENT OPERATION OF THE REINSURANCE FACILITY.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Each member insurer of the South Carolina Reinsurance Facility must submit to the Chief Insurance Commissioner, by a deadline indicated by the Chief Insurance Commissioner, an audited financial statement prepared by an independent certified public accountant, including all financial statements and footnote disclosures required under generally accepted accounting procedures, which financial statement demonstrates that the member insurer has complied with Section 38-77-540 of the 1976 Code of Laws regarding policies of automobile insurance ceded to the facility for the last three Reinsurance Facility accounting years. This statement must be transferred by the Chief Insurance Commissioner to the Board of Governors of the facility for review in order to verify that each member insurer is in compliance with statute and the Plan of Operation of the Facility. The Chief Insurance Commissioner must also include in te report the results of a review performed by the Department of Insurance of the books, records, and papers of any company, organization, business, enterprise, or other entity subject to licensure by the Department of Insurance which contracts with or has or has had a business relationship with a member insurer other than operating as an agent of the company. The Chief Insurance Commissioner shall submit to the General Assembly a comprehensive report of these findings prior to April 1, 1994.
SECTION 2. Each member insurer of the South Carolina Reinsurance Facility must also submit to the Chief Insurance commissioner, by a deadline indicated by the Chief Insurance Commissioner, supplemental comparative schedules which are to be included in the report under Section 1. The supplemental comparative schedules shall include:
(1) a detailed schedule of profit or loss incurred by each of the member insurers on business ceded to the facility;
(2) a listing of all shareholders who own more than a five percent interest and their annual compensation;
(3) a listing of all shareholders who own more than a five percent interest in any entity, corporation, or partnership with related business contracts to the facility;
(4) an annual analysis of any distribution of profits to shareholders or partners who have an ownership interest of five percent or more;
(5) the amount of reserves held by each member insurer for facility business and the income from the investment of such reserves, if applicable;
(6) a detailed listing by item and amount of all expenses which each member insurer is reimbursed by the facility, if applicable;
(7) a comparative analysis of loss ratios.
SECTION 3. The Chief Insurance Commissioner shall work in conjunction with the House Labor, Commerce and Industry Committee and the Senate Banking and Insurance Committee in the preparation of the report to be submitted to the General Assembly pursuant to Section 1.
SECTION 4. The materials and information required by this joint resolution to be collected and compiled by the Chief Insurance Commissioner, the House Labor, Commerce and Industry Committee, or the Senate Banking and Insurance Committee and the work products incidental thereto must not be disclosed to any source prior to or outside of the report to the General Assembly under Section 1.
SECTION 5. The provisions of this joint resolution mandating audit and disclosure do not apply to contracts utilized to enforce insurance policy sales between insurance agents and insureds and the member insurers, contracts for leasing or maintenance of office equipment or furniture, telephone services, office supplies, postal services, legal services, or other noninsurance-related contracts utilized in the ordinary course of everyday business operation.
SECTION 6. Notwithstanding any of the provisions of R.136 of 1993, the provisions of R.136 of 1993 shall be implemented by the Chief Insurance Commissioner in a timely manner so as to ensure the efficient operation of the South Carolina Reinsurance Facility.
SECTION 7. This joint resolution takes effect upon approval by the Governor.