§ 147.13. Effective date and exemption.
(a) This chapter applies to all insurers doing business in this Commonwealth.
(b) Insurers shall comply with this chapter for annual audited financial reports beginning January 1, 2010.
(c) Foreign insurers having direct premiums written in this Commonwealth less than $1 million in a calendar year and having fewer than 1,000 policyholders or certificateholders of directly written policies in this Commonwealth at the end of that calendar year shall be exempt from this chapter for that year unless the Commissioner makes a specific finding that compliance is necessary for the Commissioner to carry out statutory responsibilities. Foreign insurers having assumed premiums pursuant to contracts or treaties of reinsurance, or both, of $1 million or more are not exempt.
(d) Domestic insurers having total admitted assets less than $10 million, direct premium written Nationwide less than $1 million in a calendar year and having fewer than 1,000 policyholders or certificateholders of directly written policies Nationwide at the end of that calendar year are exempt from this chapter for that year unless the Commissioner makes a specific finding that compliance is necessary for the Commissioner to carry out statutory responsibilities. Domestic insurers having total admitted assets greater than $10 million or assumed premiums pursuant to contracts or treaties, or both, of reinsurance of $1 million or more are not exempt.
(e) Domestic insurers not insuring or reinsuring risks located outside of this Commonwealth having total admitted assets less than $10 million and either direct premium written of less than $1 million in a calendar year or fewer than 1,000 policyholders or certificateholders of directly written policies at the end of that calendar year are exempt from this chapter for that year, unless the Commissioner makes a specific finding that compliance is necessary for the Commissioner to carry out statutory responsibilities. Insurers having total admitted assets greater than $10 million or assumed premiums pursuant to contracts or treaties of reinsurance, or both, of $1 million or more are not exempt.
(f) Foreign insurers filing annual audited financial reports in another state, pursuant to that state’s requirements for annual audited financial reports whose requirements are substantially similar to the requirements of this chapter, are exempt from this chapter.
(g) Upon written application of an insurer, the Commissioner may grant an exemption from compliance with all or part of this chapter if the Commissioner finds, upon review of the application, that compliance with this chapter would constitute a financial or organizational hardship upon the insurer. An exemption may be granted at any time and from time to time for specified periods. If an exemption is granted, the insurer shall file a copy of the exemption with the NAIC and as required by the chief insurance regulatory official in all states where the insurer is licensed or is doing business. Within 10 days from a denial of the written application of an insurer for an exemption from this chapter, the insurer may request in writing a hearing on its application for an exemption. Hearings will be held in accordance with 2 Pa.C.S. § § 501—508 and 701—704 (relating to Administrative Agency Law) and Chapters 56 and 57 (relating to special rules of administrative practice and procedure; publication of citations and notice of hearings).
(h) Subsections (c)—(g) do not apply to continuing care providers.
(i) In the case of insurers organized in Canada or the United Kingdom of Great Britain and Northern Ireland, the annual audited financial report is defined as the annual statement of total business on the form filed by the insurers with their domiciliary supervision authority, audited by an independent chartered accountant. For these insurers, the letter required in § 147.6a (relating to letter of qualifications of independent certified public accountant) must state that the independent certified public accountant is aware of the requirements relating to the annual audited financial report filed with the Commissioner under § 147.3 (relating to filing and extensions for filing required reports and communications) and affirm that the opinion expressed is in conformity with those requirements.
(j) If an insurer or group of insurers exempt from the requirements of § 147.8a (relating to internal audit function requirements) no longer qualifies for that exemption, it shall have until December 31 of the year in which the annual statement was filed showing the threshold is exceeded to comply with the requirements of § 147.8a.
Authority The provisions of this § 147.13 amended under the authority of sections 206, 506, 1501 and 1502 of The Administrative Code of 1929 (71 P.S. § § 66, 186, 411 and 412); sections 320, 630, 1007 and 2452 of The Insurance Company Law of 1921 (40 P.S. § § 443, 764a, 967 and 991.2452); sections 205 and 206 of The Pennsylvania Fair Plan Act (40 P.S. § § 1600.205 and 1600.206); section 731 of the Medical Care Availability and Reduction of Error (MCARE) Act (40 P.S. § 1303.731); 40 Pa.C.S. § § 6125, 6331 and 6701; sections 11 and 14 of the Health Maintenance Organization Act (40 P.S. § § 1561 and 1564); and sections 7 and 25 of the Continuing-Care Provider Registration and Disclosure Act (40 P.S. § § 3207 and 3225).
Source The provisions of this § 147.13 adopted December 21, 1979, effective December 22, 1979, 9 Pa.B. 4164; amended November 10, 1995, effective November 11, 1995, 25 Pa.B. 4785; amended August 20, 2004, effective August 21, 2004, 34 Pa.B. 4591; amended October 2, 2009, effective October 3, 2009, 39 Pa.B. 5730; amended December 16, 2016, effective January 17, 2017, 46 Pa.B. 7819. Immediately preceding text appears at serial pages (345540) to (345542).
Cross References This section cited in 31 Pa. Code § 147.3 (relating to filing and extensions for filing of annual audited financial reports); 31 Pa. Code § 147.3a (relating to requirements for audit committees); and 31 Pa. Code § 147.6 (relating to recognition, qualification and responsibilities of an independent certified public accountant).
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