PROPOSED RULEMAKING
[ 31 PA. CODE CH. 139 ]
Prohibited Phrases
[38 Pa.B. 1960]
[Saturday, April 26, 2008]The Insurance Department (Department) proposes to rescind Chapter 139 (relating to prohibited phrases). This rulemaking is proposed under the authority of sections 206, 506, 1501 and 1502 of The Administrative Code of 1929 (71 P. S. §§ 66, 186, 422 and 412) and section 354 of The Insurance Company Law of 1921 (40 P. S. § 477b).
Purpose
The purpose of this rulemaking is to rescind Chapter 139 to eliminate obsolete, unnecessary regulations. Chapter 139 was adopted at 2 Pa.B. 1516 (August 11, 1972).
The chapter was adopted to prohibit the use of the phrases ''legal reserve,'' ''old line reserve'' or similar phrases to describe an insurer doing business in this Commonwealth and required that the phrases be eliminated from policies or other insurance forms.
Chapter 89b (relating to approval for life insurance, accident and health insurance and property and casualty insurance filing and form) gives the Department the authority to review all policies and forms filed with the Department. The Department has not encountered any problems or issues related to Chapter 139 in any market conduct examination or enforcement action and believes the provisions of Chapter 139 are no longer necessary as they are standard practices for licensed insurance companies.
Affected Parties
The rescission of the chapter affects insurers doing the business of insurance in this Commonwealth.
Fiscal Impact
There is no fiscal impact as a result of the proposed rulemaking.
Paperwork
The proposed rulemaking will affect all licensed insurers domiciled in this Commonwealth, but no additional paperwork requirements will be imposed.
Effectiveness/Sunset Date
The rulemaking will become effective upon final-form publication in the Pennsylvania Bulletin. Since this is a rescission, no sunset date has been assigned.
Contact Person
Questions or comments regarding the proposed rulemaking may be addressed in writing to Peter J. Salvatore, Regulatory Coordinator, Insurance Department, 1326 Strawberry Square, Harrisburg, PA 17120, within 30 days following the publication of this notice in the Pennsylvania Bulletin. Questions and comments may also be e-mailed to psalvatore@state.pa.us or faxed to (717) 705-3873.
Regulatory Review
Under section 5(a) of the Regulatory Review Act (act) (71 P. S. § 745.5(a)), on April 16, 2008, the Department submitted a copy of this proposed rulemaking to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the Senate Banking and Insurance Committee and the House Insurance Committee. In addition to the submitted proposed rulemaking, the Department has provided IRRC and the Committees with a copy of a detailed Regulatory Analysis Form prepared by the Department. A copy of that material is available to the public upon request.
Under section 5(g) of the act, if IRRC has objections to any portion of the proposed rulemaking, it will notify the Department within 10 days after the close of the Committees' review. The notification shall specify the regulatory review criteria that have not been met by that portion. The act specifies detailed procedures for the Department, the Governor and the General Assembly to review these objections before final publication of the regulations.
JOEL SCOTT ARIO,
Acting Insurance CommissionerFiscal Note: 11-237. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 31. INSURANCE
PART VIII. MISCELLANEOUS PROVISIONS
CHAPTER 139. PROHIBITED PHRASES § 139.1. [Purpose] (Reserved).
[This chapter is not intended to prohibit a company from describing or referring to the specific reserves which it is required to maintain by law.]
§ 139.2. [Prohibited phrases] (Reserved).
[The use of the phrases ''legal reserve,'' ''old line reserve,'' or a similar phrase as descriptive of an insurance company transacting business in this Commonwealth is prohibited.]
§ 139.3. [Effective date] (Reserved).
[The phrases prohibited in § 139.2 (relating to prohibited phrases) shall be eliminated from policies or other insurance forms used by an insurance company transacting business in this Commonwealth upon the date of reprinting of a policy or form or by January 1, 1974, whichever date is sooner. This ruling shall affect a policy or insurance form reprinted subsequent to August 12, 1972.]
[Pa.B. Doc. No. 08-790. Filed for public inspection April 25, 2008, 9:00 a.m.]
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