Okla. Stat. tit. 36, § 36-4061

Appropriate computation and adequacy - Periodic opinion and

memorandum of qualified actuary - Requirements - Liability -

Actuarial Opinion of Reserves - Confidentiality.

A. Definitions. For the purposes of this section, the

following definitions shall apply on or after the operative date of

the valuation manual:

1. "Accident and health insurance" means contracts that

incorporate morbidity risk and provide protection against economic

loss resulting from accident, sickness, or medical conditions and as

may be specified in the valuation manual;

2. "Appointed actuary" means a qualified actuary who is

appointed in accordance with the valuation manual to prepare the

actuarial opinion required in this section;

3. "Company" means an entity which:

a. has written, issued, or reinsured life insurance

contracts, accident and health insurance contracts, or

deposit-type contracts in this state and has at least

one such policy in force or on claim, or

b. has written, issued, or reinsured life insurance

contracts, accident and health insurance contracts, or

deposit-type contracts in any state and is required to

hold a certificate of authority to write life

insurance, accident and health insurance, or deposit-

type contracts in this state;

4. "Deposit-type contract" means contracts that do not

incorporate mortality or morbidity risks and as may be specified in

the valuation manual;

5. "Life insurance" means contracts that incorporate mortality

risk, including annuity and pure endowment contracts, and as may be

specified in the valuation manual;

6. "NAIC" means the National Association of Insurance

Commissioners;

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7. "Principle-based valuation" means a reserve valuation that

uses one or more methods or one or more assumptions determined by

the insurer and is required to comply with subsection Q of Section

1510 of this title as specified in the valuation manual;

8. "Qualified actuary" means an individual who is qualified to

sign the applicable statement of actuarial opinion in accordance

with the American Academy of Actuaries qualification standards for

actuaries signing such statements and who meets the requirements

specified in the valuation manual; and

9. "Valuation manual" means the manual of valuation

instructions adopted by the NAIC as specified in Section 1510 of

this title or as subsequently amended.

B. Actuarial Opinion Beginning January 1, 1998, and Prior to

the Operative Date of the Valuation Manual.

1. Every life insurance company doing business in this state

shall annually, and quarterly if required by the Insurance

Commissioner, submit the opinion of a qualified actuary as to

whether the reserves and related actuarial items held in support of

the policies and contracts specified by the Insurance Commissioner

by rule are computed appropriately, are based on assumptions which

satisfy contractual provisions, are consistent with prior reported

accounts and comply with applicable laws of this state. The

Commissioner by rule shall define the specifics of this opinion and

add any other items deemed to be necessary to its scope.

2. a. Every life insurance company, except as exempted by or

pursuant to rule, shall also annually, and quarterly

if required by the Insurance Commissioner, include in

the opinion required by paragraph 1 of this

subsection, an opinion of the same qualified actuary

as to whether the reserves and related actuarial items

held in support of the policies and contracts

specified by the Commissioner by rule, when considered

in light of the assets held by the company with

respect to the reserves and related actuarial items,

including but not limited to the investment earnings

on the assets and the considerations anticipated to be

received and retained under the policies and

contracts, make adequate provision for the company's

obligations under the policies and contracts,
he Commissioner by rule, when considered

in light of the assets held by the company with

respect to the reserves and related actuarial items,

including but not limited to the investment earnings

on the assets and the considerations anticipated to be

received and retained under the policies and

contracts, make adequate provision for the company's

obligations under the policies and contracts,

including but not limited to the benefits under and

expenses associated with the policies and contracts.

b. The Commissioner may provide by rule for a transition

period for establishing any higher reserves which the

qualified actuary may deem necessary in order to

render the opinion required by this section.

3. Each opinion required by paragraph 2 of this subsection

shall be accompanied by a memorandum, in form and substance

Oklahoma Statutes - Title 36. Insurance Page 906

acceptable to the Commissioner as specified by rule, prepared to

support each actuarial opinion. If the insurance company fails to

provide a supporting memorandum at the request of the Commissioner

within a period specified by rule, or the Commissioner determines

that the supporting memorandum provided by the insurance company

fails to meet the standards prescribed by the rules or is otherwise

unacceptable to the Commissioner, the Commissioner may engage a

qualified actuary at the expense of the company to review the

opinion and the basis for the opinion and prepare such supporting

memorandum as is required by the Commissioner.

4. Every opinion shall be governed by the following provisions:

a. the opinion shall be submitted with the annual

statement and quarterly statement, if a quarterly

statement is required by the Commissioner, reflecting

the valuation of such reserve liabilities for each

year,

b. the opinion shall apply to all business in force

including individual and group health insurance plans,

in form and substance acceptable to the Commissioner

as specified by rule,

c. the opinion shall be based on standards adopted from

time to time by the Actuarial Standards Board and on

such additional standards as the Commissioner may by

rule prescribe,

d. in the case of an opinion required to be submitted by

a foreign or alien company, the Commissioner may

accept the opinion filed by that company with the

insurance supervisory official of another state if the

Commissioner determines that the opinion reasonably

meets the requirements applicable to a company

domiciled in this state,

e. except in cases of fraud or willful misconduct, the

qualified actuary shall not be liable for damages to

any person, other than the insurance company and the

Commissioner, for any act, error, omission, decision

or conduct with respect to the actuary's opinion, and

f. disciplinary action by the Commissioner against the

company or the qualified actuary shall be defined in

rules by the Commissioner.

5. a. Any memorandum in support of the opinion, and any

other material provided by the company to the

Commissioner in connection therewith, shall be kept

confidential by the Commissioner and shall not be made

public and shall not be subject to subpoena, other

than for the purpose of defending an action seeking

damages from any person by reason of any action

required by this section or by rules promulgated

Oklahoma Statutes - Title 36. Insurance Page 907

hereunder; provided, however, that the memorandum or

other material may otherwise be released by the

Commissioner as follows:

(1) with the written consent of the company, or
t to subpoena, other

than for the purpose of defending an action seeking

damages from any person by reason of any action

required by this section or by rules promulgated

Oklahoma Statutes - Title 36. Insurance Page 907

hereunder; provided, however, that the memorandum or

other material may otherwise be released by the

Commissioner as follows:

(1) with the written consent of the company, or

(2) to the American Academy of Actuaries upon request

stating that the memorandum or other material is

required for the purpose of professional

disciplinary proceedings and setting forth

procedures satisfactory to the Commissioner for

preserving the confidentiality of the memorandum

or other material.

b. Once any portion of the confidential memorandum is

cited by the company in its marketing or is cited

before any governmental agency other than a state

insurance department or is released by the company to

the news media, all portions of the confidential

memorandum shall be no longer confidential.

6. For the purposes of this section, "qualified actuary" means

a member in good standing of the American Academy of Actuaries who

meets the requirements set forth in rules promulgated by the

Insurance Commissioner.

C. Actuarial Opinion of Reserves after the Operative Date of

the Valuation Manual.

1. Every company with outstanding life insurance contracts,

accident and health insurance contracts or deposit-type contracts in

this state and subject to regulation by the commissioner shall

annually, and quarterly if required by the Insurance Commissioner,

submit the opinion of the appointed actuary as to whether the

reserves and related actuarial items held in support of the policies

and contracts are computed appropriately, are based on assumptions

which satisfy contractual provisions, are consistent with prior

reported accounts and comply with applicable laws of this state.

The valuation manual will prescribe the specifics of this opinion

including any items deemed to be necessary to its scope.

2. Every life insurance company with outstanding life insurance

contracts, accident health insurance contracts or deposit type

contracts in this state and subject to regulation by the

commissioner, except as exempted in the valuation manual, shall also

annually, and quarterly if required by the Insurance Commissioner,

include in the opinion required by paragraph 1 of this subsection,

an opinion of the same appointed actuary as to whether the reserves

and related actuarial items held in support of the policies and

contracts specified in the valuation manual, when considered in

light of the assets held by the company with respect to the reserves

and related actuarial items, including, but not limited to, the

investment earnings on the assets and the considerations anticipated

to be received and retained under the policies and contracts, make

Oklahoma Statutes - Title 36. Insurance Page 908

adequate provision for the company's obligations under the policies

and contracts, including, but not limited to, the benefits under and

expenses associated with the policies and contracts.

3. Each opinion required by paragraph 2 of this subsection

shall be accompanied by a memorandum, in form and substance as

specified in the valuation manual, and acceptable to the

Commissioner, prepared to support each actuarial opinion. If the

insurance company fails to provide a supporting memorandum at the

request of the Commissioner within a period specified in the

valuation manual or is otherwise unacceptable to the Commissioner,

the Commissioner may engage a qualified actuary at the expense of

the company to review the opinion and the basis for the opinion and

prepare such supporting memorandum as is required by the

Commissioner.

4. Every opinion shall be governed by the following provisions:

a. the opinion shall be in form and substance as

specified in the valuation manual and acceptable to

the Commissioner,
ner,

the Commissioner may engage a qualified actuary at the expense of

the company to review the opinion and the basis for the opinion and

prepare such supporting memorandum as is required by the

Commissioner.

4. Every opinion shall be governed by the following provisions:

a. the opinion shall be in form and substance as

specified in the valuation manual and acceptable to

the Commissioner,

b. the opinion shall be submitted with the annual

statement and quarterly statement, if a quarterly

statement is required by the Commissioner, reflecting

the valuation of such reserve liabilities for each

year ending on or after the operative date of the

valuation manual,

c. the opinion shall apply to all policies and contracts

subject to paragraph 2 of this subsection, plus other

actuarial liabilities as may be specified in the

valuation manual,

d. the opinion shall be based on standards adopted from

time to time by the Actuarial Standards Board or its

successor, and on such additional standards as may be

prescribed in the valuation manual,

e. in the case of an opinion required to be submitted by

a foreign or alien company, the Commissioner may

accept the opinion filed by that company with the

insurance supervisory official of another state if the

Commissioner determines that the opinion reasonably

meets the requirements applicable to a company

domiciled in this state,

f. except in cases of fraud or willful misconduct, the

appointed actuary shall not be liable for damages to

any person, other than the insurance company and the

Commissioner, for any act, error, omission, decision

or conduct with respect to the appointed actuary's

opinion, and

Oklahoma Statutes - Title 36. Insurance Page 909

g. disciplinary action by the Commissioner against the

company or the appointed actuary shall be defined in

rules by the Commissioner.

D. Confidentiality.

1. For purposes of this subsection "confidential information"

means:

a. a memorandum in support of an opinion submitted under

this section and any other documents, materials and

other information, including, but not limited to, all

working papers, and copies thereof, created, produced

or obtained by or disclosed to the commissioner or any

other person in connection with such memorandum,

b. all documents, materials and other information,

including, but not limited to, all working papers, and

copies thereof, created, produced or obtained by or

disclosed to the commissioner or any other person in

the course of an examination made under paragraph 6 of

subsection P of Section 1510 of this title; provided,

however, that if an examination report or other

material prepared in connection with an examination

made under Sections 309.1 through 309.7 of this title

is not held as private and confidential information

under Sections 309.1 through 309.7 of this title, an

examination report or other material prepared in

connection with an examination made under paragraph 6

of subsection P of Section 1510 of this title shall

not be "Confidential Information" to the same extent

as if such examination report or other material had

been prepared under Sections 309.1 through 309.7 of

this title,

c. any reports, documents, materials and other

information developed by a company in support of, or

in connection with, an annual certification by the

company under subparagraph (b) of paragraph 2 of

subsection Q of Section 1510 of this title evaluating

the effectiveness of the company's internal controls

with respect to a principle-based valuation and any

other documents, materials and other information,

including, but not limited to, all working papers, and

copies thereof, created, produced or obtained by or

disclosed to the commissioner or any other person in

connection with such reports, documents, materials and

other information,

d. any principle-based valuation report developed under

subparagraph (c) of paragraph 2 of subsection Q of
y

other documents, materials and other information,

including, but not limited to, all working papers, and

copies thereof, created, produced or obtained by or

disclosed to the commissioner or any other person in

connection with such reports, documents, materials and

other information,

d. any principle-based valuation report developed under

subparagraph (c) of paragraph 2 of subsection Q of

Section 1510 of this title and any other documents,

materials and other information, including, but not

Oklahoma Statutes - Title 36. Insurance Page 910

limited to, all working papers, and copies thereof,

created, produced or obtained by or disclosed to the

commissioner or any other person in connection with

such report, and

e. any documents, materials, data and other information

submitted by a company under subsection R of Section

1510 of this title, collectively, "experience data",

and any other documents, materials, data and other

information, including, but not limited to, all

working papers, and copies thereof, created or

produced in connection with such experience data, in

each case that include any potentially company-

identifying or personally identifiable information,

that is provided to or obtained by the commissioner,

together with any "experience data", the "experience

materials", and any other documents, materials, data

and other information, including, but not limited to,

all working papers, and copies thereof, created,

produced or obtained by or disclosed to the

commissioner or any other person in connection with

such experience materials.

2. Privilege for, and Confidentiality of, Confidential

Information.

a. except as provided in this subsection, a company's

Confidential Information is confidential by law and

privileged, and shall not be subject to Oklahoma Open

Records Act, shall not be subject to subpoena and

shall not be subject to discovery or admissible in

evidence in any private civil action; provided,

however, that the commissioner is authorized to use

the Confidential Information in the furtherance of any

regulatory or legal action brought against the company

as a part of the commissioner's official duties,

b. neither the commissioner nor any person who received

Confidential Information while acting under the

authority of the commissioner shall be permitted or

required to testify in any private civil action

concerning any Confidential Information,

c. in order to assist in the performance of the

commissioner's duties, the commissioner may share

Confidential Information:

(1) with other state, federal and international

regulatory agencies and with the NAIC and its

affiliates and subsidiaries,

(2) in the case of Confidential Information specified

in subparagraphs (a) and (d) of paragraph 1 of

this subsection, with the Actuarial Board for

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Counseling and Discipline or its successor upon

request stating that the Confidential Information

is required for the purpose of professional

disciplinary proceedings and with state, federal

and international law enforcement officials, and
specified

in subparagraphs (a) and (d) of paragraph 1 of

this subsection, with the Actuarial Board for

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Counseling and Discipline or its successor upon

request stating that the Confidential Information

is required for the purpose of professional

disciplinary proceedings and with state, federal

and international law enforcement officials, and

(3) in the case of (1) and (2), provided that such

recipient agrees, and has the legal authority to

agree, to maintain the confidentiality and

privileged status of such documents, materials,

data and other information in the same manner and

to the same extent as required for the

commissioner.

d. the commissioner may receive documents, materials,

data and other information, including otherwise

confidential and privileged documents, materials, data

or information, from the NAIC and its affiliates and

subsidiaries, from regulatory or law enforcement

officials of other foreign or domestic jurisdictions

and from the Actuarial Board for Counseling and

Discipline or its successor and shall maintain as

confidential or privileged any document, material,

data or other information received with notice or the

understanding that it is confidential or privileged

under the laws of the jurisdiction that is the source

of the document, material or other information,

e. the commissioner may enter into agreements governing

sharing and use of information consistent with

paragraph 2 of this subsection,

f. no waiver of any applicable privilege or claim of

confidentiality in the Confidential Information shall

occur as a result of disclosure to the commissioner

under this section or as a result of sharing as

authorized in subparagraph (c) of paragraph 2 of this

subsection,

g. a privilege established under the law of any state or

jurisdiction that is substantially similar to the

privilege established under paragraph 2 of this

subsection shall be available and enforced in any

proceeding in, and in any court of, this state,

h. in this subsection "regulatory agency", "law

enforcement agency" and the "NAIC" include, but are

not limited to, their employees, agents, consultants

and contractors.

3. Notwithstanding paragraph 2 of this subsection, any

Confidential Information specified in subparagraphs a and d of

paragraph 1 of this subsection:

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a. may be subject to subpoena for the purpose of

defending an action seeking damages from the appointed

actuary submitting the related memorandum in support

of an opinion submitted under this section or

principle-based valuation report developed under

subparagraph c of paragraph 2 of subsection Q of

Section 1510 of this title by reason of an action

required by Section 1510 of this title or by rules

promulgated hereunder,

b. may otherwise be released by the commissioner with the

written consent of the company, and

c. once any portion of a memorandum in support of an

opinion submitted under this section or a principle-

based valuation report developed under subparagraph c

of paragraph 2 of subsection Q of Section 1510 of this

title is cited by the company in its marketing or is

publicly volunteered to or before a governmental

agency other than a state insurance department or is

released by the company to the news media, all

portions of such memorandum or report shall no longer

be confidential.