You asked for a summary of how the Connecticut Insurance Department oversees the sale and service of group life insurance in Connecticut.

SUMMARY

The Connecticut Insurance Department oversees the sale and service of group life insurance by reviewing policy forms for compliance with laws and regulations, licensing insurance producers in accordance with established qualifications, reviewing and responding to complaints filed with the department by state residents, and conducting examinations of insurance companies doing business in Connecticut to ensure compliance with insurance laws and regulations.

REGULATION OF LIFE INSURANCE

The sale and service of group life insurance is regulated by the Connecticut Insurance Department under the direction of the Insurance Commissioner. Chapter 697 of the Connecticut General Statutes requires the commissioner to see that all laws regarding insurance companies are implemented and enforced. The commissioner does this through the operation of the insurance department’s various divisions, including Life and Health, Licensing, Consumer Affairs, and Market Conduct. The below description of the divisions contains excerpts from the department’s website, http://www.ct.gov/cid.

Life and Health Division

The Life and Health Division reviews all group and individual life, health, and annuity insurance contracts delivered for issue in the state by licensed insurance companies. Connecticut law requires the department to review and approve these policy forms prior to their being offered for sale. The policies are reviewed to see that they comply with the General Statutes and regulations governing life, health, and annuity forms.

The division works with the department’s legal division to promulgate regulations and take enforcement action against carriers regarding non-compliance issues. The division has become more active in the identification, investigation, and enforcement of non-compliance issues. These investigations facilitate consumer protection by prohibiting carriers from continuing practices that are not in compliance with Connecticut insurance laws.

Licensing Division

The Licensing Division is responsible for ensuring that only competent and trustworthy persons are licensed to perform insurance services in Connecticut. The division develops and maintains educational standards and examinations for all prospective licensees and issues and renews licenses to qualified applicants. It approves courses for insurance companies, educational institutions, insurance associations, insurance training schools, and insurance publishing companies. Experior Assessments LLC (formerly Insurance Testing Corporation) conducts the tests.

Chapter 701a of the General Statutes relates to insurance producers. Producers cannot sell, solicit, or negotiate insurance without a license. The insurance commissioner can place on probation, suspend, revoke, or refuse to renew an insurance producer’s license or levy a monetary fine for the following causes: (1) providing incorrect, misleading, incomplete or materially untrue information in the license application; (2) violating any insurance laws, or violating any regulation, subpoena, or order of the commissioner or of another state's commissioner; (3) obtaining or attempting to obtain a license through misrepresentation or fraud; (4) improperly withholding, misappropriating, or converting any moneys or properties received in the course of doing an insurance business; (5) intentionally misrepresenting the terms of an actual or proposed insurance contract or application for insurance; (6) having been convicted of a felony; (7) having admitted or been found to have committed any insurance unfair trade practice or fraud; (8) using fraudulent, coercive, or dishonest practices, or demonstrating incompetence, untrustworthiness, or financial irresponsibility in the conduct of business in this state or elsewhere; (9) having an insurance producer license, or its equivalent, denied, suspended, or revoked in any other state, province, district or territory; (10) forging another's name to an application for insurance or to any document related to an insurance transaction; (11) improperly using notes or any other reference material to complete an examination for an insurance license; (12) knowingly accepting insurance business from an individual who is not licensed; (13) failing to comply with an administrative or court order imposing a child support obligation; or (14) failing to pay state income tax or comply with any administrative or court order directing payment of state income tax.

Consumer Affairs

The Consumer Affairs Division receives, reviews, and responds to complaints and inquiries from state residents concerning insurance-related problems. The staff examines each complaint to determine whether statutory requirements and contractual obligations within the commissioner’s jurisdiction have been fulfilled. The division coordinates the resources available within the department to fully address consumer complaints.

The division receives several hundred telephone calls each day. Examiners often are able to provide information and suggestions in response to a caller’s questions that allows the caller to pursue the matter on his own. In order for the division to pursue a formal review of a concern or complaint, the consumer must submit a written explanation to the division with as much pertinent detail as possible. Each year the division reviews several thousand formal complaints and inquiries.

Complaints that are found to be justified following review of all pertinent information will be pursued to resolve the issue on behalf of the consumer and the department will pursue appropriate action against the licensee or company.

In the case where a complaint is outside the jurisdiction of the Department or the examiner has determined that the licensee or company has acted properly, the division will respond in a matter designed to inform and educate the consumer filing the complaint.

Market Conduct Division

The Market Conduct Division examines the records of insurance companies doing business in Connecticut to review the treatment of policyholders and claimants in the state. Examinations are conducted on a routine basis or as needed. Examinations include the review of policy underwriting and rating, cancellations and non-renewals, claim settlements, and marketing and solicitation practices of companies and their agents. Sources of information for these investigations include insurance companies, consumers, and other divisions within the department.

If an examination reveals that a company is violating state law, the department has the authority to levy a range of sanctions, including the suspension or revocation of the company’s license to conduct business in the state, monetary fines, and restitution (e.g., refunding premiums, paying additional amounts on claims).

MORE INFORMATION

For more information on the responsibilities of the Connecticut Insurance Department, please visit its web site at http://www.ct.gov.cid/.

JB:ts