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SB 200 - Consumers' Insurance Advocate - creation, powers, compensation

Thompson, Steve (33rd)	Stokes, Connie (43rd)	Tanksley, Charles B (32nd)
Madden, Eddie M (47th)

Status Summary	SC:	I&L	HC:	Ins	FR:	02/22/99	LA:	04/20/99	Signed by Governor

First Reader Summary

A bill to amend Title 33 of the Official Code of Georgia Annotated, relating to insurance, so as to create the Consumers' Insurance Advocate and deputy advocate; to provide definitions; to provide powers; to provide for compensation; to provide for entries of appearance; to provide for notice and discovery; to provide for remedies; to provide for employment of consultants, experts, witnesses, and other employees.

Code Sections - 33-9-3/ 33-57-1/ 33-57-2/ 33-57-3/ 33-57-4/ 33-57-5/ 33-57-6/ 33-57-7/ 33-57-8

SB 200 99                                            SB200/AP 
 
      SENATE BILL 200 
 
      By: Senators Thompson of the 33rd, Stokes of the 43rd, Tanksley 
          of the 32nd and others 
 
                        A BILL TO BE ENTITLED 
                               AN ACT 
 
 
  1- 1  To amend Title 33 of the Official Code of Georgia Annotated, 
  1- 2  relating to insurance, so as to change certain provisions 
  1- 3  relating to applicability of rate regulation; to create the 
  1- 4  Consumers' Insurance Advocate and deputy advocate; to 
  1- 5  provide definitions; to provide powers; to provide for 
  1- 6  compensation; to provide for entries of appearance; to 
  1- 7  provide for notice and discovery; to provide for remedies; 
  1- 8  to provide for employment of consultants, experts, 
  1- 9  witnesses, and other employees; to provide for the 
  1-10  publication of certain information; to provide for access to 
  1-11  documents and other information; to provide that other 
  1-12  remedies are not affected; to provide an effective date; to 
  1-13  repeal conflicting laws; and for other purposes. 
 
  1-14       BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA: 
 
  1-15                           SECTION 1. 
 
  1-16  Title 33 of the Official Code of Georgia Annotated, relating 
  1-17  to insurance, is amended by striking Code Section 33-9-3, 
  1-18  relating to applicability of rate regulation, and inserting 
  1-19  in lieu thereof the following: 
 
  1-20    "33-9-3. 
 
  1-21    (a) This chapter shall apply to all insurance on risks or 
  1-22    on operations in this state, except: 
 
  1-23      (1) Reinsurance other than joint reinsurance to the 
  1-24      extent stated in Code Section 33-9-19; 
 
  1-25      (2) Life insurance; 
 
  1-26      (3) Accident and sickness insurance Disability income, 
  1-27      specified disease, or hospital indemnity policies; 
 
  1-28      (4) Insurance of vessels or craft, their cargoes, marine 
  1-29      builders' risks, marine protection and indemnity, or 
  1-30      other risks commonly insured under marine, as 
  1-31      distinguished from transportation, insurance policies. 
  1-32      Inland marine insurance shall be deemed to include 
 
 
 
                                 -1- 
 
 
 
  2- 1      insurance defined by statute, or by interpretation 
  2- 2      thereof or, if not so defined or interpreted, by ruling 
  2- 3      of the Commissioner or as established by general custom 
  2- 4      of the business, as inland marine insurance; 
 
  2- 5      (5) Insurance against loss of or damage to aircraft, 
  2- 6      insurance of hulls of aircraft, including their 
  2- 7      accessories and equipment, or insurance against 
  2- 8      liability arising out of the ownership, maintenance, or 
  2- 9      use of aircraft; 
 
  2-10      (6) Title insurance; or 
 
  2-11      (7) Annuities. 
 
  2-12    (a.1) The Commissioner may by rule or regulation establish 
  2-13    criteria by which defined commercial risks may be exempted 
  2-14    from the filing requirements of this chapter. 
 
  2-15      (b)(1) This chapter shall apply to all insurers, 
  2-16      including stock and mutual companies, Lloyd's 
  2-17      associations, and reciprocal and interinsurance 
  2-18      exchanges, which under any laws of this state write any 
  2-19      of the kinds of insurance to which this chapter applies. 
 
  2-20      (2) The provisions of this chapter regarding rates shall 
  2-21      apply to any insurer, fraternal benefit society, health 
  2-22      care plan, nonprofit medical service corporation, 
  2-23      nonprofit hospital service corporation, health 
  2-24      maintenance organization, or preferred provider 
  2-25      organization providing any accident or sickness 
  2-26      insurance or health benefit plan issued, delivered, 
  2-27      issued for delivery, or renewed in this state to the 
  2-28      extent required by subsection (c) of this Code section. 
 
  2-29    (c) Provisions of this chapter regarding rates shall apply 
  2-30    only to a proposed rate for any insurance or health 
  2-31    benefit plan: 
 
  2-32      (1) Which alone or in combination with any previous rate 
  2-33      change for such insurance or plan would result in a rate 
  2-34      increase of: 
 
  2-35        (A) Any amount, but no decrease shall be subject to 
  2-36        such provisions; provided, however, 
 
  2-37        (B) The provisions of this chapter shall not apply to 
  2-38        accident and sickness insurance; or 
 
  2-39      (2) Made within 36 months after any rate change 
  2-40      described by paragraph (1) of this subsection." 
 
 
 
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  3- 1                           SECTION 2. 
 
  3- 2  Said title is further amended by adding a new Chapter 57 at 
  3- 3  the end thereof to read as follows: 
 
 
 
  3- 4    33-57-1. 
 
  3- 5    The General Assembly recognizes the importance of 
  3- 6    effectively managed and economical insurance and health 
  3- 7    management funding products and services to the citizens 
  3- 8    of the State of Georgia.  It is further recognized that 
  3- 9    the citizens of Georgia should receive adequate insurance 
  3-10    and health management funding products and services at the 
  3-11    lowest reasonable cost to the consumer while maintaining 
  3-12    the ability of insurance and health management funding 
  3-13    companies to furnish their products and services.  It is 
  3-14    further recognized that the Insurance Department has been 
  3-15    established for the purpose, among other things, of 
  3-16    regulating insurance and health management funding 
  3-17    companies, the rates which they charge the consumer, and 
  3-18    for representing the public interest.  The General 
  3-19    Assembly is aware, however, that the department and the 
  3-20    Commissioner must be furnished with all available 
  3-21    information concerning the effects of its decisions in any 
  3-22    proceedings before it.  It is the purpose of this chapter 
  3-23    to ensure that the department and the Commissioner receive 
  3-24    such information, particularly in those cases that 
  3-25    directly involve Georgia's citizens.  It is further the 
  3-26    intent of the General Assembly that consumers have 
  3-27    reasonable choices among the products and services offered 
  3-28    by insurance and health management funding companies and 
  3-29    that these companies are accountable to consumers. 
 
  3-30    33-57-2. 
 
  3-31    As used in this chapter, the term: 
 
  3-32      (1) 'Administrator' means the administrator appointed 
  3-33      pursuant to Code Section 10-1-395. 
 
  3-34      (2) 'Advocate' means the Consumers' Insurance Advocate 
  3-35      in the Governor's Office of Consumer Affairs. 
 
  3-36      (3) 'Commissioner' means the Commissioner of Insurance 
  3-37      created in Code Section 33-2-1. 
 
  3-38      (4) 'Consumer' means a beneficiary or user, whether 
  3-39      directly or indirectly, of any insurance products or 
  3-40      services which are under the jurisdiction of the 
 
 
                                 -3- 
 
 
 
  4- 1      Commissioner or of the department other than products 
  4- 2      and services of a domestic supplemental life and health 
  4- 3      insurer. 
 
  4- 4      (5) 'Department' means the Insurance Department created 
  4- 5      pursuant to Code Section 33-2-1. 
 
  4- 6      (6) 'Governor's Office of Consumer Affairs' means the 
  4- 7      office of the administrator created in Code Section 
  4- 8      10-1-395. 
 
  4- 9    33-57-3. 
 
  4-10    There are created the Consumers' Insurance Advocate and 
  4-11    deputy advocate within the Governor's Office of Consumer 
  4-12    Affairs.  The advocate and deputy advocate may be 
  4-13    attorneys licensed to practice in the courts of this state 
  4-14    and shall be appointed by and serve at the pleasure of the 
  4-15    Governor.  The advocate shall receive compensation in an 
  4-16    amount to be determined by the Governor but not to exceed 
  4-17    that provided or authorized by law for the district 
  4-18    attorney for the Atlanta Judicial Circuit, excluding all 
  4-19    city and county supplemental compensation and expenses. 
  4-20    In addition to such compensation, the advocate shall also 
  4-21    receive reimbursement for his or her reasonable and 
  4-22    necessary expenses incurred in the performance of his or 
  4-23    her duties, as provided by law for state employees.  The 
  4-24    advocate shall have discretion to employ an individual in 
  4-25    the position of deputy advocate, and such person shall 
  4-26    receive such compensation as shall be determined by the 
  4-27    advocate, together with reimbursement of expenses on the 
  4-28    same terms as the advocate.  No person employed as 
  4-29    advocate or deputy advocate shall engage in the private 
  4-30    practice of law while employed as the Consumers' Insurance 
  4-31    Advocate.  The advocate shall submit a written report of 
  4-32    quarterly activities, decisions, information obtained, and 
  4-33    expenditures of the advocate's office.  The report shall 
  4-34    be submitted to the Insurance Committee of the Georgia 
  4-35    House of Representatives and to the Insurance and Labor 
  4-36    Committee of the Georgia Senate not less than 30 days 
  4-37    after the end of each quarter of each calendar year. 
 
  4-38    33-57-4. 
 
  4-39    (a) The advocate shall be entitled to appear, as a party 
  4-40    or otherwise, on behalf of the consumers of this state of 
  4-41    products or services provided by any person, firm, or 
  4-42    corporation subject to the jurisdiction of the 
  4-43    Commissioner or of the department in all proceedings or 
 
 
                                 -4- 
 
 
 
  5- 1    other matters pending before the department or the 
  5- 2    Commissioner. 
 
  5- 3    (b) The advocate shall also appear in the same 
  5- 4    representative capacity as specified in subsection (a) of 
  5- 5    this Code section in similar administrative proceedings 
  5- 6    affecting the consumers of this state before any federal 
  5- 7    administrative agency or body which has regulatory 
  5- 8    jurisdiction over products or services purchased by 
  5- 9    consumers. 
 
  5-10    (c) The advocate shall be authorized in the same 
  5-11    representative capacity as specified in subsection (a) of 
  5-12    this Code section to initiate proceedings, by complaint or 
  5-13    otherwise, before any federal or state administrative 
  5-14    agency before which he or she is otherwise authorized to 
  5-15    appear, with respect to matters properly within the 
  5-16    cognizance of those agencies.  When such complaint or 
  5-17    other request is filed with the Commissioner, the 
  5-18    Commissioner shall respond to such complaint or other 
  5-19    request within 45 days. 
 
  5-20    (d) The advocate shall be authorized in the same 
  5-21    representative capacity as specified in subsection (a) of 
  5-22    this Code section to initiate or intervene as of right or 
  5-23    otherwise appear in any judicial proceeding involving or 
  5-24    arising out of any action taken by an administrative 
  5-25    agency in a proceeding in which the advocate is authorized 
  5-26    to appear under subsection (a), (b), or (c) of this Code 
  5-27    section. 
 
  5-28    (e) The advocate shall be authorized to publish by 
  5-29    available means, including Internet access, such 
  5-30    information as the advocate may deem to be in the public 
  5-31    interest relating to the duties and purposes of the 
  5-32    advocate's office and findings, research, and studies 
  5-33    conducted by that office, except any information which is 
  5-34    confidential or privileged as otherwise provided by law. 
 
  5-35    (f) The advocate shall be authorized to hear complaints 
  5-36    and to present and advocate positions affecting rates or 
  5-37    benefits for any insurance products and services afforded 
  5-38    to state employees and may for this purpose appear before 
  5-39    any state officer or state entity providing or 
  5-40    administering such benefits. 
 
 
 
 
 
 
                                 -5- 
 
 
 
  6- 1    33-57-5. 
 
  6- 2    (a) In addition to other requirements of service and 
  6- 3    notice imposed by law, a copy of any request for insurance 
  6- 4    or health benefit plan rate filing: 
 
  6- 5      (1) Which alone or in combination with any previous rate 
  6- 6      filing would result in a rate increase of: 
 
  6- 7        (A) Any amount, but no decrease shall be subject to 
  6- 8        such provisions; provided, however, 
 
  6- 9        (B) Rate information, including information submitted, 
  6-10        requested for submission, or required to be submitted 
  6-11        to the Commissioner or department for purposes of 
  6-12        determining whether insurance rates are excessive, 
  6-13        inadequate, or unfairly discriminatory, and any 
  6-14        correspondence or paper filed with or issued by the 
  6-15        department or by the Commissioner in connection with 
  6-16        such rate information shall be served by copy upon the 
  6-17        advocate, and the Office of Consumer Affairs shall 
  6-18        require by rule or regulation that financial 
  6-19        information of insurers, including a summary of 
  6-20        products offered, basic rates applicable to such 
  6-21        products, financial statements, officers' salaries, 
  6-22        notifications of rate increases, and, as to health 
  6-23        insurers, actuarial summaries and opinions relating to 
  6-24        consumer choice options on managed care products shall 
  6-25        be submitted to the department and the advocate on a 
  6-26        quarterly basis; or 
 
  6-27      (2) Made within 36 months after any rate filing 
  6-28      described by paragraph (1) of this subsection 
 
  6-29    shall also be served on the advocate, and the advocate 
  6-30    shall be notified of any other correspondence or paper 
  6-31    filed with or issued by the department or by the 
  6-32    Commissioner in connection with such rate filing. A notice 
  6-33    of such filing shall be sent to the advocate certified 
  6-34    mail, return receipt requested. The department or the 
  6-35    Commissioner shall not proceed to hear or determine any 
  6-36    petition, complaint, proceeding, or request for rate 
  6-37    filing in which the advocate is entitled to appear unless 
  6-38    it shall affirmatively appear that the advocate was given 
  6-39    at least ten days' written notice thereof, unless such 
  6-40    notice is affirmatively waived in writing or the advocate 
  6-41    appears and specifically waives such notice.  The advocate 
  6-42    may also request copies of any application, complaint, 
 
 
 
                                 -6- 
 
 
 
  7- 1    pleading, notice, or other document filed with or issued 
  7- 2    by the department or by the Commissioner. 
 
  7- 3    (b) In any case of a rate filing which is subject to the 
  7- 4    provisions of subsection (a) of this Code section, the 
  7- 5    advocate is authorized to take depositions and obtain 
  7- 6    discovery of any matter which is not privileged and which 
  7- 7    is relevant to the subject matter involved in any 
  7- 8    proceeding or petition before the department or by the 
  7- 9    Commissioner in the same manner and subject to the same 
  7-10    procedures which would otherwise be applicable if such 
  7-11    proceeding was then pending before a superior court. 
  7-12    Copies of materials and information obtained through such 
  7-13    discovery shall be made available to the department.  The 
  7-14    superior courts and judges and clerks thereof are 
  7-15    authorized to issue all orders, injunctions, and subpoenas 
  7-16    and to take all actions necessary to carry out this 
  7-17    subsection. 
 
  7-18    33-57-6. 
 
  7-19    The administrator shall employ and fix the compensation of 
  7-20    at least one actuary as a regular full-time employee to 
  7-21    assist the advocate, and the administrator is authorized 
  7-22    to employ and fix the compensation of such other 
  7-23    assistants as the advocate may need, including without 
  7-24    limitation consultants, expert witnesses, accountants, 
  7-25    attorneys, investigators, stenographers, or other 
  7-26    technical or clerical assistants as may be necessary to 
  7-27    carry out the advocate's duties; provided, however, that 
  7-28    no such employment may occur nor may any contracts for 
  7-29    payment of fees or expenses be paid for consultants, 
  7-30    expert witnesses, accountants, attorneys, investigators, 
  7-31    stenographers, or other technical or clerical assistants 
  7-32    unless such employment or such contracts are first 
  7-33    approved by the administrator and can be achieved using 
  7-34    funds appropriated to the Governor's Office of Consumer 
  7-35    Affairs for such purposes.  The office of the advocate 
  7-36    shall keep suitable and proper records of all such 
  7-37    expenditures.  The compensation of the advocate and such 
  7-38    staff shall be paid from state funds appropriated to the 
  7-39    Governor's Office of Consumer Affairs for such purposes. 
 
  7-40    33-57-7. 
 
  7-41    Services of all consultants, expert witnesses, 
  7-42    accountants, actuaries, attorneys, investigators, 
  7-43    stenographers, or other technical or clerical assistants 
 
 
 
                                 -7- 
 
 
 
  8- 1    employed by the department may be available to the 
  8- 2    advocate in the performance of his or her duties upon the 
  8- 3    approval of the department; and such consultants, expert 
  8- 4    witnesses, accountants, actuaries, attorneys, 
  8- 5    investigators, stenographers, or other technical or 
  8- 6    clerical assistants shall make such appraisals and audits 
  8- 7    as the advocate, with the approval of the department, may 
  8- 8    request.  The advocate and his or her staff shall have 
  8- 9    access to all records, files, reports, documents, and 
  8-10    other information in the possession or custody of the 
  8-11    department or of the Commissioner to the same extent as 
  8-12    the department or as the Commissioner has access thereto 
  8-13    and subject to the same limitations imposed on the use 
  8-14    thereof by the department or by the Commissioner.  A 
  8-15    written report of the cost of all services provided for 
  8-16    the advocate pursuant to this Code section shall be 
  8-17    submitted by the advocate along with each quarterly report 
  8-18    made to committees of the General Assembly pursuant to 
  8-19    Code Section 33-57-3. 
 
  8-20    33-57-8. 
 
  8-21    This chapter shall not be construed to prevent any party 
  8-22    interested in any proceeding or action before the 
  8-23    department, the Commissioner, any court, or any 
  8-24    administrative body from appearing in person or by 
  8-25    representing counsel in such proceeding or action. 
  8-26    However, nothing in this chapter shall apply to a domestic 
  8-27    supplemental life and health insurer." 
 
  8-28                           SECTION 3. 
 
  8-29  This Act shall become effective on July 1, 1999. 
 
  8-30                           SECTION 4. 
 
  8-31  All laws and parts of laws in conflict with this Act are 
  8-32  repealed. 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                 -8-