Utah Code 31A-25-205. Financial responsibility
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(1) Every person licensed under this chapter shall maintain an insurance policy or surety bond:
Terms Used In Utah Code 31A-25-205
- Administrator: means the same as that term is defined in Subsection (187). See Utah Code 31A-1-301
- authorized insurer: means an insurer:(191)(b)(i) holding a valid certificate of authority to do an insurance business in this state; and(191)(b)(ii) transacting business as authorized by a valid certificate. See Utah Code 31A-1-301
- Contract: A legal written agreement that becomes binding when signed.
- Employee: means :
(57)(a) an individual employed by an employer; or(57)(b) an individual who meets the requirements of Subsection (55)(b). See Utah Code 31A-1-301- Equal: means , with respect to biological sex, of the same value. See Utah Code 68-3-12.5
- Form: means one of the following prepared for general use:
(74)(a)(i) a policy;(74)(a)(ii) a certificate;(74)(a)(iii) an application;(74)(a)(iv) an outline of coverage; or(74)(a)(v) an endorsement. See Utah Code 31A-1-301- Insurance: includes :
(96)(b)(i) a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;(96)(b)(ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and(96)(b)(iii) a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301- Insured: means a person to whom or for whose benefit an insurer makes a promise in an insurance policy and includes:
(103)(a)(i) a policyholder;(103)(a)(ii) a subscriber;(103)(a)(iii) a member; and(103)(a)(iv) a beneficiary. See Utah Code 31A-1-301- Person: includes :
(146)(a) an individual;(146)(b) a partnership;(146)(c) a corporation;(146)(d) an incorporated or unincorporated association;(146)(e) a joint stock company;(146)(f) a trust;(146)(g) a limited liability company;(146)(h) a reciprocal;(146)(i) a syndicate; or(146)(j) another similar entity or combination of entities acting in concert. See Utah Code 31A-1-301- Policy: includes a service contract issued by:
(150)(b)(i) a motor club under Chapter 11, Motor Clubs;(150)(b)(ii) a service contract provided under Chapter 6a, Service Contracts; and(150)(b)(iii) a corporation licensed under:(150)(b)(iii)(A) Chapter 7, Nonprofit Health Service Insurance Corporations; or(150)(b)(iii)(B) Chapter 8, Health Maintenance Organizations and Limited Health Plans. See Utah Code 31A-1-301(1)(a)(1)(a)(i) while licensed; and(1)(a)(ii) for one year after the person is licensed; and(1)(b) issued:(1)(b)(i) by an authorized insurer;(1)(b)(ii) in an amount specified under Subsection (2); and(1)(b)(iii) on a policy or contract form that is acceptable under Subsection (3).(2)(2)(a) Insurance policies or surety bonds satisfying the requirement of Subsection (1) shall be in a face amount equal to:(2)(a)(i) at least the greater of:(2)(a)(i)(A) 10% of the total funds handled by the administrator; or(2)(a)(i)(B) $5,000; and(2)(a)(ii) may not exceed $500,000.(2)(b) In fixing the policy or bond face amount under Subsection (2)(a), the total funds handled is:(2)(b)(i) the greater of:(2)(b)(i)(A) the premiums received during the previous calendar year; or(2)(b)(i)(B) claims paid through the administrator during the previous calendar year; or(2)(b)(ii) if no funds were handled during the preceding year, the total funds reasonably anticipated to be handled by the administrator during the current calendar year.(2)(c) This section does not prohibit any person dealing with the administrator from requiring, by contract, insurance coverage in amounts greater than the insurance coverage required under this section.(3)(3)(a) Insurance policies or surety bonds issued to satisfy Subsection (1) shall:(3)(a)(i) be on forms approved by the commissioner; and(3)(a)(ii) require the insurer to pay, up to the policy or bond face amount, any judgment:(3)(a)(ii)(A) obtained by participants in or beneficiaries of plans administered by the insured licensee; and(3)(a)(ii)(B) that arises from the negligence or culpable acts of the licensee or any employee or agent of the licensee in connection with the activities of a third party administrator as defined in Section 31A-1-301.(3)(b) The commissioner may require that policies or bonds issued to satisfy the requirements of this section require the insurer to give the commissioner 20 day prior notice of policy cancellation.(4) The commissioner shall establish annual reporting requirements and forms to monitor compliance with this section.(5) This section may not be construed as limiting any cause of action an insured would otherwise have against the insurer.