TITLE 28. INSURANCE

PART 1. TEXAS DEPARTMENT OF INSURANCE

CHAPTER 3. LIFE, ACCIDENT, AND HEALTH INSURANCE AND ANNUITIES

The Commissioner of Insurance adopts amendments to 28 TAC Chapter 3, concerning life, accident, and health insurance and annuities. Sections 3.2 - 3.4, 3.6, 3.7, 3.104, 3.105, 3.107, 3.108, 3.114, 3.115, 3.124, 3.127, 3.203 - 3.205, 3.301, 3.302, 3.308, 3.310, 3.311, 3.408, 3.601, 3.702, 3.704, 3.802 - 3.806, 3.811, 3.909, 3.1001, 3.1002, and 3.1006, 3.1101, 3.1303 - 3.1305, 3.1403, 3.1404, 3.1601, 3.1602, 3.1605, 3.1607, 3.1720, 3.1740, 3.1742, 3.1760, 3.3001, 3.3009, 3.3010, 3.3038, 3.3039, 3.3052, 3.3057, 3.3070, 3.3092, 3.3100, 3.3101, 3.3110, 3.3321, 3.3401 - 3.3403, 3.3829, 3.3832, 3.3837, 3.3842, 3.3849, 3.3871, 3.3873, 3.3874, 3.4001, 3.4002, 3.4004, 3.4005, 3.4101 - 3.4103, 3.4105, 3.4317, 3.4503, 3.4506, 3.5103, 3.5302, 3.5602, 3.5610, 3.9101, 3.9103, 3.9104, 3.9106, 3.9202, 3.9203, 3.9206, 3.9211, 3.9212, 3.9401, 3.9403 and 3.9503 are adopted without changes to the proposed text published in the November 5, 2021, issue of the Texas Register (46 TexReg 7496). These rules will not be republished.

Section 3.5002 and §3.1606 are adopted with nonsubstantive changes to the proposed text. The Texas Department of Insurance (TDI) revised §3.5002 to correct internal references to other rule sections by replacing "subchapter" with "title" in §3.5002(9) and §3.5002(17) and by adding a missing end parenthesis in §3.5002(7)(E). TDI revised §3.1606 by changing the words "apply" to "applies" and "remain" to "remains." These rules will be republished.

REASONED JUSTIFICATION. The amendments update numerous sections throughout Chapter 3 to reflect Insurance Code §1105.0015 and §425.073, relating to the valuation manual and the operative date of that manual. The amendments also correct and update obsolete and incorrect text throughout Chapter 3. Amendments include updates to (1) statutory references to reflect Insurance Code recodification; (2) use the current names of state agencies; (3) specify current mailing and website addresses; and (4) correct punctuational, grammatical, and typographical errors and revise punctuation and capitalization as appropriate for agency style.

Amendments to multiple sections include the deletion of "shall" or replacement of "shall" with "will" (or another context-appropriate word). The purpose of changing the word "shall" is to provide plain language clarification of the rule text, consistent with current agency style and guidance on the TDI website, which provides links to resources on writing in plain language. Resources TDI uses for plain language guidance include plainlanguage.gov, which provides federal plain language guidelines, and the National Archives guidelines for clear legal documents. Both sources advise using alternatives to the word "shall" to provide clarity for readers.

The adopted sections also replace "subchapter" or "chapter" with "title" where necessary, and remove "the" in front of and commas following "Insurance Code" where appropriate. The adopted sections also replace gendered references to the Commissioner with the phrase "the commissioner."

SUMMARY OF COMMENTS. TDI did not receive any comments on the proposed amendments.

SUBCHAPTER A. SUBMISSION REQUIREMENTS FOR FILINGS AND DEPARTMENTAL ACTIONS RELATED TO SUCH FILINGS

28 TAC §§3.2 - 3.4, 3.6, 3.7

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter A under Insurance Code §§1153.005, 1251.008, 1273.005, 1701.060, and 36.001.

Insurance Code §1153.005 provides that the Commissioner may adopt rules to implement Chapter 1153.

Insurance Code §1251.008 states that the Commissioner may adopt rules necessary to administer Chapter 1251.

Insurance Code §1273.005 specifies that the Commissioner may adopt rules to implement Chapter 1273, Subchapter A.

Insurance Code §1701.060 specifies that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201525

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER B. INDIVIDUAL LIFE INSURANCE POLICY FORM CHECKLIST AND AFFIRMATIVE REQUIREMENTS

28 TAC §§3.104, 3.105, 3.107, 3.108, 3.114, 3.115, 3.124, 3.127

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter B under Insurance Code §§1153.005, 1251.008, 1273.005, 1701.060, and 36.001.

Insurance Code §1153.005 provides that the Commissioner may adopt rules to implement Chapter 1153.

Insurance Code §1251.008 states that the Commissioner may adopt rules necessary to administer Chapter 1251.

Insurance Code §1273.005 specifies that the Commissioner may adopt rules to implement Chapter 1273, Subchapter A.

Insurance Code §1701.060 specifies that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201526

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER C. APPROVAL, DISAPPROVAL, AND WITHDRAWAL OF APPROVAL OF CERTAIN PARTICIPATING POLICY FORMS

28 TAC §§3.203 - 3.205

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter C under Insurance Code §§541.401, 1701.060, and 36.001.

Insurance Code §541.401 provides that the Commissioner may adopt and enforce reasonable rules to accomplish the purposes of Chapter 541, relating to deceptive, unfair, and prohibited practices.

Insurance Code §1701.060 specifies that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201527

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER D. INDETERMINATE PREMIUM REDUCTION POLICIES

28 TAC §§3.301, 3.302, 3.308, 3.310, 3.311

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter D under Insurance Code §§543.001, 1701.060, and 36.001.

Insurance Code §543.001 provides that the Commissioner may adopt and enforce reasonable rules as provided by Chapter 541, Subchapter I, relating to rulemaking, to accomplish the purposes of §543.001(b)(1), prohibiting misrepresentation, as those purposes relate to life insurance companies.

Insurance Code §1701.060 specifies that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201528

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER E. GROUP LIFE, AND/OR GROUP ACCIDENT AND HEALTH INSURANCE POLICIES AND CERTIFICATES

28 TAC §3.408

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter E under Insurance Code §§1204.154, 1701.060, and 36.001.

Insurance Code §1204.154 provides that the Commissioner adopt uniform policy provisions, riders, and endorsements for the policy requirement of Insurance Code §1204.153, relating to payments to the Health and Human Services Commission for certain children.

Insurance Code §1701.060 specifies that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201529

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER G. PLAIN LANGUAGE REQUIREMENTS FOR HEALTH BENEFIT POLICIES

28 TAC §3.601

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter G under Insurance Code §§1501.010, 1501.260, and 36.001.

Insurance Code §1501.010 requires that the Commissioner adopt rules necessary to implement Chapter 1501 and meet the minimum requirements of federal law, including regulations.

Insurance Code §1501.260 requires that health benefit plan issuers use policies and certificates that are written in plain language. Section 1501.260(e) states that a policy or certificate is written in plain language if it achieves the minimum score established by the Commissioner on the Flesch Reading Ease test or an equivalent test selected by the Commissioner.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201530

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER H. VARIABLE ANNUITIES

28 TAC §3.702, §3.704

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter H under Insurance Code §1152.002 and §36.001.

Insurance Code §1152.002 specifies that the Commissioner may adopt rules that are fair, reasonable, and appropriate to augment and implement Chapter 1152, including rules establishing requirements for agent licensing, standard policy provisions, and disclosure.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201531

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER I. VARIABLE LIFE INSURANCE

28 TAC §§3.802 - 3.806, 3.811

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter I under Insurance Code §1152.002 and §36.001.

Insurance Code §1152.002 specifies that the Commissioner may adopt rules that are fair, reasonable, and appropriate to augment and implement Chapter 1152, including rules establishing requirements for agent licensing, standard policy provisions, and disclosure.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201532

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER J. REQUIRED REINSTATEMENT RELATING TO MENTAL INCAPACITY OF THE INSURED FOR INDIVIDUAL LIFE POLICIES WITHOUT NONFORFEITURE BENEFITS

28 TAC §3.909

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter J under Insurance Code §1106.010 and §36.001.

Insurance Code §1106.010 provides that the Commissioner adopt reasonable rules to implement Chapter 1106.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201533

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER K. MAXIMUM GUARANTEED INTEREST RATES FOR ANNUITIES, PURE ENDOWMENT CONTRACTS, AND MISCELLANEOUS FUNDS

28 TAC §§3.1001, 3.1002, 3.1006

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter K under Insurance Code §1701.060 and §36.001.

Insurance Code §1701.060 specifies that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201545

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER L. STRENGTHENED RESERVES PURSUANT TO INSURANCE CODE §425.067

28 TAC §3.1101

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter L under Insurance Code §425.067 and §36.001.

Insurance Code §425.067 authorizes the Commissioner to establish categories of necessary reserves for certain policies, contracts, or benefits issued by life insurance companies.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201534

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER N. NONFORFEITURE STANDARDS FOR INDIVIDUAL LIFE INSURANCE IN EMPLOYER PENSION PLANS

28 TAC §§3.1303 - 3.1305

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter N under Insurance Code §§425.073, 541.057, 541.401, 1105.055(h), and 36.001.

Insurance Code §425.073 requires the Commissioner to adopt by rule a valuation manual and to determine the operative date of the manual.

Insurance Code §541.057 prohibits unfair discrimination in the rates charged, dividends or benefits payable, or any other contract terms and conditions for individuals of the same class and equal life expectancy in life insurance and annuity contracts.

Insurance Code §541.401 provides that the Commissioner may adopt and enforce reasonable rules necessary to accomplish the purposes of Chapter 541.

Insurance Code §1105.055(h) specifies that the Commissioner may adopt by rule any ordinary mortality table adopted after 1980 by the National Association of Insurance Commissioners.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201535

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER O. SMOKER-NONSMOKER COMPOSITE MORTALITY TABLES

28 TAC §3.1403, §3.1404

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter O under Insurance Code §§541.057, 541.401, 1105.055(h), and 36.001.

Insurance Code §541.057 prohibits unfair discrimination in the rates charged, dividends or benefits payable, or any other contract terms and conditions for individuals of the same class and equal life expectancy in life insurance and annuity contracts.

Insurance Code §541.401 provides that the Commissioner may adopt and enforce reasonable rules necessary to accomplish the purposes of Chapter 541.

Insurance Code §1105.055(h) specifies that the Commissioner may adopt by rule any ordinary mortality table adopted after 1980 by the National Association of Insurance Commissioners.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201536

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER Q. ACTUARIAL OPINION AND MEMORANDUM REGULATION

28 TAC §§3.1601, 3.1602, 3.1605 - 3.1607

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter Q under Insurance Code §§425.054, 425.073, and 36.001.

Insurance Code §425.054 provides that the Commissioner specify by rule the requirements of an actuarial opinion under §425.054(b), including any matters considered necessary to the opinion's scope.

Insurance Code §425.073 requires the Commissioner to adopt by rule a valuation manual and to determine the operative date of the manual.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

§3.1606.Statement of Actuarial Opinion Based on an Asset Adequacy Analysis.

(a) General description. The statement of actuarial opinion required by this section must consist of the following paragraphs:

(1) a paragraph identifying the appointed actuary and his or her qualifications, recommended language is provided in subsection (b)(1) of this section;

(2) a scope paragraph (recommended language is provided in subsection (b)(2) of this section) identifying the subjects on which an opinion is to be expressed and describing the scope of the appointed actuary's work, including a tabulation delineating the reserves and related actuarial items that have been analyzed for asset adequacy and the method of analysis, and identifying the reserves and related actuarial items covered by the opinion that have not been so analyzed;

(3) a reliance paragraph (recommended language is provided in subsection (b)(3) of this section) describing those areas, if any, where the appointed actuary has deferred to other experts in developing data, procedures, or assumptions (e.g., anticipated cash flows from currently owned assets, including variation in cash flows according to economic scenarios), supported by a statement of each such expert with the information prescribed by subsection (e) of this section; and

(4) an opinion paragraph expressing the appointed actuary's opinion with respect to the adequacy of the supporting assets to mature the liabilities (recommended language is provided in subsection (b)(6) of this section).

(5) One or more additional paragraphs will be needed in individual company cases as follows:

(A) if the appointed actuary considers it necessary to state a qualification of his or her opinion;

(B) if the appointed actuary must disclose an inconsistency in the method of analysis or basis of asset allocation used at the prior opinion date with that used for this opinion;

(C) if the appointed actuary must disclose whether additional reserves as of the prior opinion date are released as of this opinion date, and the extent of the release; or

(D) if the appointed actuary chooses to add a paragraph briefly describing the assumptions that form the basis for the actuarial opinion.

(b) Recommended language. The following paragraphs are to be included in the statement of actuarial opinion in accordance with this section. The language is that which should be included in typical circumstances in a statement of actuarial opinion. The language may be modified as needed to meet the circumstances of a particular case, but the appointed actuary should use language which clearly expresses his or her professional judgment. Regardless of the language used, the opinion must retain all pertinent aspects of the language provided in this section.

(1) The opening paragraph should generally indicate the appointed actuary's relationship to the company and his or her qualifications to sign the opinion.

(A) For a company actuary, the opening paragraph of the actuarial opinion should include a statement such as:

Figure: 28 TAC §3.1606(b)(1)(A) (No change.)

(B) For a consulting actuary, the opening paragraph should include a statement such as:

Figure: 28 TAC §3.1606(b)(1)(B) (No change.)

(2) The scope paragraph should include a statement such as:

Figure: 28 TAC §3.1606(b)(2) (No change.)

(3) If the appointed actuary has relied on other experts to develop certain portions of the analysis, the reliance paragraph should include a statement such as:

Figure: 28 TAC §3.1606(b)(3) (No change.)

(4) If the appointed actuary has examined the underlying asset and liability records, the reliance paragraph should include a statement such as:

Figure: 28 TAC §3.1606(b)(4) (No change.)

(5) If the appointed actuary has not examined the underlying records, but has relied upon data (e.g., listings and summaries of policies in force or asset records) prepared by the company, the reliance paragraph should include a statement such as:

Figure: 28 TAC §3.1606(b)(5) (No change.)

(6) The opinion paragraph should include a statement such as:

Figure: 28 TAC §3.1606(b)(6) (No change.)

(c) Assumptions for new issues. The adoption for new issues or new claims or other new liabilities of an actuarial assumption that differs from a corresponding assumption used for prior new issues or new claims or other new liabilities is not a change in actuarial assumptions within the meaning of this section.

(d) Adverse opinions. If the appointed actuary is unable to form an opinion, then he or she must refuse to issue a statement of actuarial opinion. If the appointed actuary's opinion is adverse or qualified, then he or she must issue an adverse or qualified actuarial opinion explicitly stating the reasons for the opinion. This statement should follow the scope paragraph and precede the opinion paragraph.

(e) Reliance on information furnished by other persons. If the appointed actuary relies on the certification of others on matters concerning the accuracy or completeness of any data underlying the actuarial opinion, or the appropriateness of any other information used by the appointed actuary in forming the actuarial opinion, the actuarial opinion should so indicate the persons the actuary is relying upon and a precise identification of the items subject to reliance. In addition, the persons on whom the appointed actuary relies must provide a certification that precisely identifies the items on which the person is providing information and a statement as to the accuracy, completeness, or reasonableness, as applicable, of the items. This certification must include the signature, title, company, address, email address, and telephone number of the person rendering the certification, as well as the date on which it is signed.

(f) Alternate option.

(1) Insurance Code Chapter 425, Subchapter B, gives the commissioner broad authority to accept the valuation of a foreign insurer when that valuation meets the requirements applicable to a company domiciled in this state in the aggregate. As an alternative to the requirements of subsection (b)(6) of this section, the commissioner may make one or more of the following additional approaches available to the opining actuary:

(A) a statement that the reserves "meet the requirements of the insurance laws and regulations of the State of (state of domicile) and the formal written standards and conditions of this state for filing an opinion based on the law of the state of domicile." If the commissioner chooses to allow this alternative, a formal written list of standards and conditions must be made available. If a company chooses to use this alternative, the standards and conditions in effect on July 1 of a calendar year apply to statements for that calendar year and remain in effect until they are revised or revoked. If no list is available, this alternative is not available.

(B) a statement that the reserves "meet the requirements of the insurance laws and regulations of the State of (state of domicile) and I have verified that the company's request to file an opinion based on the law of the state of domicile has been approved and that any conditions required by the commissioner for approval of that request have been met." If the commissioner chooses to allow this alternative, a formal written statement of such allowance must be issued no later than March 31 of the year it is first effective. It will remain valid until rescinded or modified by the commissioner. The rescission or modifications must be issued no later than March 31 of the year they are first effective. Subsequent to that statement being issued, if a company chooses to use this alternative, the company must file a request to do so, along with justification for its use, no later than April 30 of the year of the opinion to be filed. The request will be deemed approved on October 1 of that year if the commissioner has not denied the request by that date.

(C) a statement that the reserves "meet the requirements of the insurance laws and regulations of the State of (state of domicile) and I have submitted the required comparison as specified by this state."

(i) If the commissioner chooses to allow this alternative, a formal written list of products (to be added to the table in Figure: 28 TAC §3.1606(f)(1)(C)(ii)) for which the required comparison must be provided will be published. If a company chooses to use this alternative, the list in effect on July 1 of a calendar year applies to statements for that calendar year and remains in effect until it is revised or revoked. If no list is available, this alternative is not available.

(ii) If a company desires to use this alternative, the appointed actuary must provide a comparison of the gross nationwide reserves held to the gross nationwide reserves that would be held under §7.18 of this title (relating to NAIC Accounting Practices and Procedures Manual). Gross nationwide reserves are the total reserves calculated for the total company in force business directly sold and assumed, indifferent to the state in which the risk resides, without reduction for reinsurance ceded. The information provided must be at least:

Figure: 28 TAC §3.1606(f)(1)(C)(ii) (No change.)

(iii) The information listed must include all products identified by either the state of filing or any other states subscribing to this alternative.

(iv) If there is no codification standard for the type of product or risk in force or if the codification standard does not directly address the type of product or risk in force, the appointed actuary must provide detailed disclosure of the specific method and assumptions used in determining the reserves held.

(2) The commissioner may reject an opinion based on the laws and regulations of the state of domicile and require an opinion based on the laws of this state. If a company is unable to provide the opinion within 60 days of the request or such other period of time determined by the commissioner after consultation with the company, the commissioner may contract with an independent actuary at the company's expense to prepare and file the opinion.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201537

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER R. LIFE SETTLEMENT

DIVISION 2. LICENSE APPLICATION AND RENEWAL; COURSE AND TRAINING REQUIREMENTS; MAINTENANCE OF RECORDS

28 TAC §3.1720

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter R, Division 2, under Insurance Code §1111A.015 and §36.001.

Insurance Code §1111A.015 authorizes the Commissioner to adopt rules to implement Chapter 1111A and regulate the activities and relationships of providers, brokers, insurers, and their authorized representatives.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201538

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


DIVISION 3. FORM FILING AND USAGE REQUIREMENTS

28 TAC §3.1740, §3.1742

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter R, Division 3, under Insurance Code §1111A.015 and §36.001.

Insurance Code §1111A.015 authorizes the Commissioner to adopt rules to implement Chapter 1111A and regulate the activities and relationships of providers, brokers, insurers, and their authorized representatives.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201539

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


DIVISION 4. ANNUAL REPORTING

28 TAC §3.1760

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter R, Division 4, under Insurance Code §1111A.015 and §36.001.

Insurance Code §1111A.015 authorizes the Commissioner to adopt rules to implement Chapter 1111A and regulate the activities and relationships of providers, brokers, insurers, and their authorized representatives.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201540

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER S. MINIMUM STANDARDS AND BENEFITS AND READABILITY FOR INDIVIDUAL ACCIDENT AND HEALTH INSURANCE POLICIES

28 TAC §§3.3001, 3.3009, 3.3010, 3.3038, 3.3039, 3.3052, 3.3057, 3.3070, 3.3092, 3.3100, 3.3101, 3.3110

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter S under Insurance Code §§1201.006, 1202.051, and 36.001.

Insurance Code §1201.006 authorizes the Commissioner to adopt reasonable rules as necessary to implement the purposes and provisions of Chapter 1201.

Insurance Code §1202.051 provides that the Commissioner adopt rules necessary to implement §1202.051 and meet the minimum requirements of federal law, including regulations.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201541

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER T. MINIMUM STANDARDS FOR MEDICARE SUPPLEMENT POLICIES

28 TAC §3.3321

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter T under Insurance Code §1652.005 and §36.001.

Insurance Code §1652.005 provides that the Commissioner adopt rules necessary and proper to carry out Chapter 1652.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201542

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER U. NEWBORN CHILDREN COVERAGE

28 TAC §§3.3401 - 3.3403

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter U under Insurance Code §1367.055 and §36.001.

Insurance Code §1367.055 provides that the Commissioner may adopt rules necessary to implement Chapter 1367, Subchapter B.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201543

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER Y. STANDARDS FOR LONG-TERM CARE INSURANCE, NON-PARTNERSHIP AND PARTNERSHIP LONG-TERM CARE INSURANCE COVERAGE UNDER INDIVIDUAL AND GROUP POLICIES AND ANNUITY CONTRACTS, AND LIFE INSURANCE POLICIES THAT PROVIDE LONG-TERM CARE BENEFITS WITHIN THE POLICY

DIVISION 2. NON-PARTNERSHIP AND PARTNERSHIP LONG-TERM CARE INSURANCE

28 TAC §§3.3829, 3.3832, 3.3837, 3.3842, 3.3849

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter Y, Division 2, under Insurance Code §§1651.004, 1651.107, and 36.001.

Insurance Code §1651.004 authorizes TDI to adopt reasonable rules necessary and proper to carry out Chapter 1651.

Insurance Code §1651.107 provides that the Commissioner may adopt rules as necessary to implement Chapter 1651, Subchapter C.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201544

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


DIVISION 4. PARTNERSHIP LONG-TERM CARE INSURANCE ONLY

28 TAC §§3.3871, 3.3873, 3.3874

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter Y, Division 4, under Insurance Code §§1651.004, 1651.107, and 36.001.

Insurance Code §1651.004 authorizes TDI to adopt reasonable rules necessary and proper to carry out Chapter 1651.

Insurance Code §1651.107 authorizes the Commissioner to adopt rules as necessary to implement Chapter 1651, Subchapter C.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201546

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER Z. EXEMPTION FROM REVIEW AND APPROVAL OF CERTAIN LIFE, ACCIDENT, HEALTH AND ANNUITY FORMS AND EXPEDITION OF REVIEW

28 TAC §§3.4001, 3.4002, 3.4004, 3.4005

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter Z under Insurance Code §1701.060 and §36.001.

Insurance Code §1701.060 provides that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201547

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER AA. LIMITED EXEMPTION FOR INSURANCE COVERAGE FROM THE REQUIREMENTS OF INSURANCE CODE CHAPTER 1701

28 TAC §§3.4101 - 3.4103, 3.4105

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter AA under Insurance Code §1701.060 and §36.001.

Insurance Code §1701.060 provides that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201548

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER CC. STANDARDS FOR ACCELERATION-OF-LIFE-INSURANCE BENEFITS FOR INDIVIDUAL AND GROUP POLICIES AND RIDERS

28 TAC §3.4317

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter CC under Insurance Code §§1111.053, 1701.060, and 36.001.

Insurance Code §1111.053 provides that the Commissioner may adopt rules to implement Chapter 1111, Subchapter B.

Insurance Code §1701.060 provides that the Commissioner may adopt reasonable rules necessary to implement the purposes of Chapter 1701.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201549

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER EE. VALUATION OF LIFE INSURANCE POLICIES

28 TAC §3.4503, §3.4506

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter EE under Insurance Code §§425.058(c)(3), 425.073, and 36.001.

Insurance Code §425.058(c)(3) specifies that for an ordinary life insurance policy issued on the standard basis, to which Chapter 1105, Subchapter B, applies, the applicable table is any ordinary mortality table adopted after 1980 by the National Association of Insurance Commissioners that is approved by Commissioner rule for use in determining the minimum standard values under Chapter 425, Subchapter B.

Insurance Code §425.073 requires the Commissioner to adopt by rule a valuation manual and to determine the operative date of the manual.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201550

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER FF. CREDIT LIFE AND CREDIT ACCIDENT AND HEALTH INSURANCE

DIVISION 1. GENERAL PROVISIONS

28 TAC §3.5002

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter FF, Division 1, under Insurance Code §1153.005 and §36.001.

Insurance Code §1153.005 provides that the Commissioner may adopt rules to implement Chapter 1153.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

§3.5002.Definitions.

The following words and terms, when used in this chapter, have the following meanings unless the context clearly indicates otherwise.

(1) Account--The aggregate credit life insurance or credit accident and health coverage for a single class of business written through a single creditor, or written through more than one creditor under common control or ownership, by the insurer, whether coverage is written on a group or individual policy basis.

(2) Actual earned premium--The total of all premiums earned at the premium rates actually charged and in force during the experience period.

(3) Approved deviation by case--A premium rate or premium rate schedule adjusted in accordance with the deviation procedures set out in Division 6 of this subchapter (relating to Deviation Procedures).

(4) Automatic deviation--A premium rate that is filed pursuant to Insurance Code §1153.105.

(5) Average number of life years--The average of the number of group certificates or individual policies in force each month during the experience period (without regard to multiple coverage) times the number of years in the experience period.

(6) Case--Either a "single account case" or a "multiple account case" as follows:

(A) Single account case--An account that is at least 25% credible or, at the option of the insurer, any higher percentage as determined by the credibility table set out in §3.5603 of this title (relating to Credibility Table). An insurer exercising this option must in writing notify, and obtain written approval of the commissioner, of the credibility factor it will use to define a "single account case." Once the commissioner is so notified, the credibility factor will remain in effect for the insurer until a different election has been filed in writing by the insurer and approved by the commissioner.

(B) Multiple account case--A combination of all the insurer's accounts of the same class of business with experience in this state, excluding all single account cases of the insurer defined in subparagraph (A) of this paragraph, or with the approval of the commissioner; "multiple account case" also means two or more accounts of the insurer, having like underwriting characteristics which are combined by the insurer for premium rating purposes, excluding all "single account cases" as defined in subparagraph (A) of this paragraph and other "multiple account cases" defined previously.

(7) Class of business--A class of business listed as follows:

(A) Class A--Commercial banks, savings and loan associations and mortgage companies;

(B) Class B--Finance companies and small loan companies;

(C) Class C--Credit unions;

(D) Class D--Production credit associations (agriculture and horticulture P.C.A.s);

(E) Class E--Dealers (including auto and truck, other dealers, and retail stores); and

(F) Class F--Other than subparagraphs (A) - (E) of this paragraph.

(8) Closed-end transactions--Credit transactions other than "open-end transactions" as defined in this section.

(9) Credibility factor--The degree to which the past experience of a case can be expected to occur in the future. The credibility factor is based either on the average number of life years or the incurred claim count during the experience period as shown in the credibility table set out in §3.5603 of this title. The insurer must notify the commissioner in writing, and obtain written approval of the commissioner, about which of the two methods it will use in measuring credibility. Once the commissioner is so notified, the method will remain in effect for the insurer until a change has been filed with and approved by the commissioner.

(10) Credit disability--Credit Accident and Health.

(11) Earned premium at presumptive premium rate--Premium earned during the experience period at the presumptive premium rate set forth in §3.5206 of this title (relating to Presumptive Premium Rates). If the rate for a case is not the presumptive premium rate, premium earned at the presumptive premium rate must be determined in accordance with the conversion method set forth in Form CI-EP-L or Form CI-EP-DIS, as appropriate, provided by the department for that purpose, and set out in an attachment by the insurer to its deviation request form. The forms can be obtained from the Texas Department of Insurance, Life and Health Division, Filings Intake, MC-LH-LHL, P.O. Box 12030, Austin, Texas 78711-2030. The forms can also be obtained from the department's internet website at www.tdi.texas.gov/forms.

(12) Experience--The earned premiums and incurred claims for a single or multiple account case. Experience will be the most recent experience in this state for a class of business, and may include the experience of the case while with a prior insurer to the extent necessary to achieve credibility.

(13) Experience period--The period of time for which experience is reported, but not for period longer than three years.

(14) Incurred claim count--The number of claims incurred for the case during the experience period. This means the total number of claims reported during the experience period (whether paid or in the process of payment) plus any incurred but not reported at the end of the experience period less the number of claims incurred but not reported at the beginning of the experience period. If a debtor has been issued more than one certificate for the same plan of insurance, only one claim is counted. If a debtor receives disability benefits, only the initial claim payment for that period of disability is counted.

(15) Incurred claims--The liability resulting from the happening of the contingency insured against whether paid, reported, not reported or resisted on accounting dates, valued by date of occurrence and, without reduction for reinsurance, at amounts, excluding claims expenses, sufficient to discharge the company from all liability and is equal to claims paid minus unreported claims beginning of period plus unreported claims end of period minus claim reserve beginning of period plus claim reserve end of period.

(16) Open-end transactions or revolving accounts--Transactions in which credit is extended by a creditor under an agreement whereby:

(A) the creditor reasonably contemplates repeated transactions;

(B) the creditor may impose a finance charge from time to time on an outstanding unpaid balance; and

(C) the amount of credit that may be extended to the debtor during the term of the plan (up to any limit set by the creditor) is generally made available to the extent that any outstanding balance is repaid.

(17) Presumptive premium rate--The rate established by the commissioner and set out in §3.5206 of this title.

(18) Pro rata method--A method used in determining premium refunds based on the assumption that premiums are earned in equal increments over the term of the policy. The premium refunds are calculated by multiplying the original gross premium by a factor determined by the formula t/n, in which t is the number of months remaining from its evaluation date to the end of the loan and n is the number of months in the original term.

(19) Rule of anticipation (aka the single premium method)--A method used in determining premium refunds in which the unearned premium is equal to the gross single premium for the remaining term and remaining benefits.

(20) Sum of the digits method, aka rule of 78 method--A method used in determining premium refunds in which an unearned premium factor is calculated by dividing the sum of the original number of monthly payments by the sum of the remaining number of monthly payments. The premium refunds are calculated by multiplying the original gross premium by a factor determined by the formula (t * (t+1)/(n * (n+1), in which t is the number of months remaining from its evaluation date to the end of the loan and n is the number of months in the original term.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201551

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


DIVISION 2. APPLICATIONS AND POLICIES

28 TAC §3.5103

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter FF, Division 2, under Insurance Code §1153.005 and §36.001.

Insurance Code §1153.005 provides that the Commissioner may adopt rules to implement Chapter 1153.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201552

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


DIVISION 4. PRESUMPTIVELY ACCEPTABLE RELATION OF CREDIT LIFE INSURANCE BENEFITS TO PREMIUMS

28 TAC §3.5302

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter FF, Divisions 4, under Insurance Code §1153.005 and §36.001.

Insurance Code §1153.005 provides that the Commissioner may adopt rules to implement Chapter 1153.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201553

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


DIVISION 6. DEVIATION PROCEDURES

28 TAC §3.5602, §3.5610

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter FF, Division 6, under Insurance Code §1153.005 and §36.001.

Insurance Code §1153.005 provides that the Commissioner may adopt rules to implement Chapter 1153.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201554

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER JJ. 2001 CSO MORTALITY TABLE

28 TAC §§3.9101, 3.9103, 3.9104, 3.9106

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter JJ under Insurance Code §§425.058(c)(3), 425.073, 1105.055(h), and 36.001.

Insurance Code §425.058(c)(3) specifies that for an ordinary life insurance policy issued on the standard basis, to which Chapter 1105, Subchapter B, applies, the applicable table is any ordinary mortality table adopted after 1980 by the National Association of Insurance Commissioners that is approved by Commissioner rule for use in determining the minimum standard values under Chapter 425, Subchapter B.

Insurance Code §425.073 requires the Commissioner to adopt by rule a valuation manual and to determine the operative date of the manual.

Insurance Code §1105.055(h) specifies that the Commissioner may adopt by rule any ordinary mortality table adopted after 1980 by the National Association of Insurance Commissioners.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201555

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER KK. EXCLUSIVE PROVIDER BENEFIT PLAN

28 TAC §§3.9202, 3.9203, 3.9206, 3.9211, 3.9212

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter KK under Insurance Code §845.004 and §36.001, Government Code §533.0025, and Health and Safety Code §62.051.

Insurance Code §845.004 provides that the Commissioner must adopt rules as necessary to implement the Statewide Rural Health Care System Act.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

Government Code §533.0025 provides that the Medicaid-managed care delivery system must use the most cost-effective cost model, as determined by the Health and Human Services Commission.

Health and Safety Code §62.051 provides that the Commissioner of the Health and Human Services Commission may delegate to TDI the authority to adopt, with the approval of the commission, any rules necessary to implement the Children's Health Insurance Program.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201556

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER MM. PREFERRED MORTALITY TABLES

28 TAC §3.9401, §3.9403

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter MM under Insurance Code §§425.058(c)(3), 425.073, 1105.055(h), and 36.001.

Insurance Code §425.058(c)(3) specifies that for an ordinary life insurance policy issued on the standard basis, to which Chapter 1105, Subchapter B, applies, the applicable table is any ordinary mortality table adopted after 1980 by the National Association of Insurance Commissioners that is approved by Commissioner rule for use in determining the minimum standard values under Chapter 425, Subchapter B.

Insurance Code §425.073 requires the Commissioner to adopt by rule a valuation manual and to determine the operative date of the manual.

Insurance Code §1105.055(h) specifies that the Commissioner may adopt by rule any ordinary mortality table adopted after 1980 by the National Association of Insurance Commissioners.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201557

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584


SUBCHAPTER NN. CONSUMER NOTICES FOR LIFE INSURANCE POLICY AND ANNUITY CONTRACT REPLACEMENTS

28 TAC §3.9503

STATUTORY AUTHORITY. The Commissioner adopts amendments to Subchapter NN under Insurance Code §§1114.006, 1114.007, and 36.001.

Insurance Code §1114.006 provides that the Commissioner by rule adopt or approve model documents to be used for consumer notices under Chapter 1114.

Insurance Code §1114.007 authorizes the Commissioner to adopt reasonable rules in the manner prescribed by Insurance Code, Chapter 36, Subchapter A, to accomplish and enforce the purpose of Chapter 1114.

Insurance Code §36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of TDI under the Insurance Code and other laws of this state.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 21, 2022.

TRD-202201558

James Person

General Counsel

Texas Department of Insurance

Effective date: May 11, 2022

Proposal publication date: November 5, 2021

For further information, please call: (512) 676-6584