NOTICES
INDEPENDENT REGULATORY REVIEW COMMISSION
Actions Taken by the Commission
[28 Pa.B. 859] The Independent Regulatory Review Commission met publicly at 11 a.m., Thursday, January 29, 1998, and took the following actions:
Regulations Approved
Insurance Department # 11-130: Notice of Increase in Premium and Midterm Cancellation or Nonrenewal of Policies (amends 31 Pa Code Chapter 113 Subchapter G)
Insurance Department # 11-148 Credit Life Insurance, Credit Accident and Health Insurance and Credit Unemployment Insurance (amends 31 Pa Code Chapters 71 and 73)
Department of Revenue # 15-371 Tax Amnesty Program; Further Examination of Books and Records (amends 61 Pa Code by deleting existing § 6.22 and adding § 8a.1 to Chapter 8a.)
Regulations Deemed Approved under section 5(g) of the Regulatory Review Act -- Effective January 27, 1998.
Insurance Department #11-141: Miscellaneous (deletes 31 Pa. Code §§ 137.2--137.4)
Commissioners Present: John R. McGinley, Jr., Chairperson; Alvin C. Bush, Vice Chairperson; Arthur Coccodrilli; Robert J. Harbison, III; John F. Mizner
Public Meeting held
January 29, 1998Insurance Department--Notices of Increase in Premium and Midterm Cancellation or Nonrenewal of Policies; Doc. No. 11-130
Order On August 29, 1996, the Independent Regulatory Review Commission (Commission) received this proposed regulation from the Insurance Department (Department). This rulemaking amends 31 Pa. Code Chapter 113 Subchapter G. The statutory authority for the regulation is found in section 9 of the Act of July 3, 1986 (P. L. 396, No. 86) (act) (40 P. S. § 3409), as amended by Act 10 of 1995 (Act 10). The proposed regulation was published in the September 14, 1996 edition of the Pennsylvania Bulletin, with a 30-day public comment period. The final-form regulation was submitted to the Commission on January 5, 1998.
These amendments address problems that have occurred with cancellations and nonrenewals of commercial property and casualty insurance policies. In addition, they modify the existing regulation to be consistent with the amendments made by Act 10.
Amendments include reducing the time period for providing advance notice of intent to increase premiums for commercial policies from 60 days to 30 days. Also, consistent with Act 10, the current requirement that insurers provide insureds with an estimate of premiums at least 30 days prior to the renewal date of the insurance policy is eliminated.
The Department improved the clarity of the final-form regulation by revising the definition of commercial property and casualty risk insurance. The Department also added a new definition of personal risk insurance to help distinguish the two basic categories of risk insurance.
We have reviewed this regulation and find it to be in the public interest. Benefits to affected commercial property and casualty insurers and agents include having to provide only one notice of premium increases to policyholders instead of two. This change is estimated to reduce costs for the insurance industry by approximately $2.2 million annually. Policyholders will be protected because they will continue to receive advance notice of premium increases.
Therefore, It Is Ordered That:
1. Regulation No. 11-130 from the Insurance Department, as submitted to the Commission on January 5, 1998, is approved; and
2. The Commission will transmit a copy of this Order to the Legislative Reference Bureau.
Commissioners Present: John R. McGinley, Jr., Chairperson; Alvin C. Bush, Vice Chairperson; Arthur Coccodrilli; Robert J. Harbison, III; John F. Mizner
Public Meeting held
January 29, 1998Insurance Department--Credit Life Insurance, Credit Accident and Health Insurance and Credit Unemployment Insurance; Doc. No. 11-148
Order On July 23, 1997, the Independent Regulatory Review Commission (Commission) received this proposed regulation from the Insurance Department (Department). This rulemaking amends 31 Pa. Code Chapters 71 and 73. The authority for this regulation is found in Section 12 of the Model Act for the Regulation of Credit Life Insurance and Credit Accident and Health Insurance (40 P. S. § 1007.12) and Sections 641(b) and (b.1) of the Insurance Department Act of 1921 (40 P. S. § 281(b) and (b.1)). The proposed regulation was published in the August 2, 1997 edition of the Pennsylvania Bulletin with a 30-day public comment period. The final-form regulation was submitted to the Commission on January 5, 1998.
The Department is proposing to delete Chapter 71 relating to general provisions and amend Chapter 73 relating to credit life insurance, credit accident and health insurance, and credit unemployment insurance. The Department notes that Chapters 71 and 73 have become outdated and incomplete as the nature and type of credit transactions and resulting credit insurance coverages have evolved. To keep up with the changing nature of credit insurance, the Department has issued various notices and directives to provide direction to the credit insurance industry. The proposed regulation codifies these notices and reflects the provisions of the Model Act for the Regulation of Credit Life Insurance and Credit Accident and Health Insurance and the Insurance Department Act of 1921.
We have reviewed this regulation and find it to be in the public interest. The proposal will provide necessary updates to the Department's credit insurance regulations.
Therefore, It is Ordered That:
1. Regulation No. 11-148 from the Insurance Department, as submitted to the Commission on January 5, 1998, is approved; and
2. The Commission will transmit a copy of this Order to the Legislative Reference Bureau.
Commissioners Present: John R. McGinley, Jr., Chairperson; Alvin C. Bush, Vice Chairperson; Arthur Coccodrilli; Robert J. Harbison, III; John F. Mizner
Public Meeting held
January 29, 1998Department of Revenue--Tax Amnesty Program; Further Examination of Books and Records; Doc. No. 15-371
Order On September 13, 1995, the Independent Regulatory Review Commission (Commission) received this proposed regulation from the Department of Revenue (Department). This rulemaking amends 61 Pa. Code by deleting existing Section 6.22 Further examination of books and records and adding Section 8a.1 Further examination of books and records, to Chapter 8a. Enforcement. This rulemaking also amends similar language in Section 35.1 Tax examinations and assessments to avoid conflict or confusion with Section 8a.1. The authority for this regulation is 72 P. S. § 9915-A. The proposed regulation was published in the September 23, 1995 Pennsylvania Bulletin with a 30-day public comment period. A final-form regulation was submitted to the Commission on October 22, 1997, and was disapproved by the Commission on November 20, 1997. The Department submitted a modified final-form regulation to the Commission on January 5, 1998.
This regulation provides for examination of all books, papers and records of a taxpayer to verify the accuracy and completeness of any tax return filed by the taxpayer or to assess any tax owed to the Commonwealth if no tax return has been filed by the taxpayer. Included in the provisions of this regulation is the use of ''statistical sampling'' and ''block sampling'' in ''test audits'' under certain circumstances to establish the liability of a taxpayer.
The Department has already adopted regulations which are the subject matter of this proposed rulemaking. Section 22 of Act 21 of June 30, 1995 (Act 21) (P. L. 139, No. 21) contains the Tax Amnesty Program for which the Legislature allowed the Department to adopt regulations without going through the regulatory review process. In conjunction with implementation of the Tax Amnesty Program, and working within the time constraints of Act 21, the Department added Section 6.22 Further examination of books and records. The proposed regulation, upon which the Commission expressed strong concerns, was identical to the tax amnesty program regulation at Section 6.22. The Department intends to delete Section 6.22 of its regulations when the final-form version of Section 8a.1 is approved.
We have reviewed this modified final-form regulation and find it to be in the public interest. The original proposal by the Department in 1995 contained vague procedures the Department would use. As a result, the Commission commented extensively on the proposed rulemaking. On November 20, 1997, the Commission unanimously disapproved the final-form regulation submitted by the Department citing a lack of standards an audit must meet, optional consideration of factors rather than binding consideration, and some other clarity issues. The regulation submitted to the Commission on January 5, 1998, is a significant improvement over the original proposal submitted in 1995. The Department has added definitions of the terms used in the regulation. The Department clarified the scope of the regulation. The Department delineated factors the Department will consider in determining the audit method to use. The Department added provisions which provide guidance on the procedures used for statistical sampling, including allowing the taxpayer an option to increase the size of the sample. The test audit plan will be reviewed with the taxpayer prior to an audit, including an explanation that the taxpayer may request an increase in sample size. The Department will review audit findings and calculations with the taxpayer, including procedures for processing, assessing, and appealing of audit findings. Finally, the statutory basis for a taxpayer to appeal was added to the regulation. The Department's response to our concerns has resulted in a modified final-form regulation that meets the criteria of the Regulatory Review Act.
Therefore, It is Ordered That:
1. Regulation No. 15-371 from the Department of Revenue, as submitted to the Commission on January 5, 1998, is approved; and
2. The Commission will transmit a copy of this Order to the Legislative Reference Bureau.
Commissioners Present: John R. McGinley, Jr., Chairperson; Alvin C. Bush, Vice Chairperson; Arthur Coccodrilli; Robert J. Harbison, III; John F. Mizner
Public Meeting held
January 29, 1998Insurance Department--Miscellaneous; Doc. No. 11-141
Order On March 31, 1997, the Independent Regulatory Review Commission (Commission) received this proposed regulation from the Insurance Department (Insurance). This rulemaking deletes 31 Pa. Code §§ 137.2--137.4. The authority for this regulation is sections 206, 506, 1501 and 1502 of The Administrative Code of 1929 (71 P. S. §§ 66, 186, 411 and 412). The proposed regulation was published in the April 12, 1997 Pennsylvania Bulletin with a 30-day public comment period. The final-form regulation was submitted to the Commission on January 5, 1998.
This regulation will delete existing provisions that dulicate policies and requirements found elsewhere in State or Federal laws and regulations. It repeals 31 Pa. Code Chapter 137 which is entitled ''Miscellaneous.''
The final-form regulation contains no changes from the proposed regulation. We did not file any comments on the proposed regulation. Furthermore, we did not receive any negative recommendations on the final-form regulation from the House Insurance Committee and Senate Banking and Insurance Committee.
Therefore:
The Commission will notify the Legislative Reference Bureau that Regulation No. 11-141 from the Insurance Department, as submitted to the Commission on January 5, 1998, was deemed approved under section 5(g) of the Regulatory Review Act on January 27, 1998.
JOHN R. MCGINLEY, Jr.,
Chairperson
[Pa.B. Doc. No. 98-269. Filed for public inspection February 13, 1998, 9:00 a.m.]
No part of the information on this site may be reproduced for profit or sold for profit.This material has been drawn directly from the official Pennsylvania Bulletin full text database. Due to the limitations of HTML or differences in display capabilities of different browsers, this version may differ slightly from the official printed version.
