Okla. Stat. tit. 36, § 36-7004

A. Pursuant to terms and conditions of this act, the State of

Oklahoma seeks to join with other states and establish the

Interstate Insurance Product Regulation Compact, and thus become a

member of the Interstate Insurance Product Regulation Commission.

B. The Insurance Commissioner of the State of Oklahoma is

hereby designated to serve as the representative of this state to

the Commission.

C. The Governor is hereby authorized and directed to execute a

Compact on behalf of this state with any other state or states

legally joining therein in the form substantially as follows:

INTERSTATE INSURANCE PRODUCT REGULATION COMPACT

ARTICLE I. PURPOSES

The purposes of this Compact are, through means of joint and

cooperative action among the compacting states:

1. To promote and protect the interest of consumers of

individual and group annuity, life insurance, disability income and

long-term care insurance products;

2. To develop uniform standards for insurance products covered

under the Compact;

3. To establish a central clearinghouse to receive and provide

prompt review of insurance products covered under the Compact and,

in certain cases, advertisements related thereto, submitted by

insurers authorized to do business in one or more compacting states;

4. To give appropriate regulatory approval to those product

filings and advertisements satisfying the applicable uniform

standard;

5. To improve coordination of regulatory resources and

expertise between state insurance departments regarding the setting

of uniform standards and review of insurance products covered under

the Compact;

6. To create the Interstate Insurance Product Regulation

Commission; and

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7. To perform these and such other related functions as may be

consistent with the state regulation of the business of insurance.

ARTICLE II. DEFINITIONS

For purposes of this Compact:

1. “Advertisement” means any material designed to create public

interest in a product, or induce the public to purchase, increase,

modify, reinstate, borrow on, surrender, replace or retain a policy,

as more specifically defined in the rules and operating procedures

of the Commission;

2. “Bylaws” means those bylaws established by the Commission

for its governance, or for directing or controlling the Commission’s

actions or conduct;

3. “Compacting state” means any state which has enacted this

Compact legislation and which has not withdrawn pursuant to Section

1 of Article XIV of this Compact, or been terminated pursuant to

Section 2 of Article XIV of this Compact;

4. “Commission” means the “Interstate Insurance Product

Regulation Commission” established by this Compact;

5. “Commissioner” means the chief insurance regulatory official

of a state including, but not limited to, commissioner,

superintendent, director or administrator;

6. “Domiciliary state” means the state in which an insurer is

incorporated or organized or, in the case of an alien insurer, its

state of entry;

7. “Insurer” means any entity licensed by a state to issue

contracts of insurance for any of the lines of insurance covered by

this act;

8. “Member” means the person chosen by a compacting state as

its representative to the Commission, or his or her designee;

9. “Noncompacting state” means any state which is not at the

time a compacting state;

10. “Operating procedures” means procedures promulgated by the

Commission implementing a rule, uniform standard or a provision of

this Compact;

11. “Product” means the form of a policy or contract, including

any application, endorsement, or related form which is attached to

and made a part of the policy or contract, and any evidence of

coverage or certificate, for an individual or group annuity, life

insurance, disability income or long-term care insurance product

that an insurer is authorized to issue;

12. “Rule” means a statement of general or particular
form of a policy or contract, including

any application, endorsement, or related form which is attached to

and made a part of the policy or contract, and any evidence of

coverage or certificate, for an individual or group annuity, life

insurance, disability income or long-term care insurance product

that an insurer is authorized to issue;

12. “Rule” means a statement of general or particular

applicability and future effect promulgated by the Commission,

including a uniform standard developed pursuant to Article VII of

this Compact, designed to implement, interpret, or prescribe law or

policy or describing the organization, procedure, or practice

requirements of the Commission, which shall have the force and

effect of law in the compacting states;

Oklahoma Statutes - Title 36. Insurance Page 1463

13. “State” means any state, district or territory of the

United States of America;

14. “Third-party filer” means an entity that submits a product

filing to the Commission on behalf of an insurer; and

15. “Uniform standard” means a standard adopted by the

Commission for a product line, pursuant to Article VII of this

Compact, and shall include all of the product requirements in

aggregate; provided, that each uniform standard shall be construed,

whether express or implied, to prohibit the use of any inconsistent,

misleading or ambiguous provisions in a product and the form of the

product made available to the public shall not be unfair,

inequitable or against public policy as determined by the

Commission.

ARTICLE III. ESTABLISHMENT OF THE COMMISSION AND VENUE

1. The compacting states hereby create and establish a joint

public agency known as the “Interstate Insurance Product Regulation

Commission”. Pursuant to Article IV of this Compact, the Commission

will have the power to develop uniform standards for product lines,

receive and provide prompt review of products filed therewith, and

give approval to those product filings satisfying applicable uniform

standards; provided, it is not intended for the Commission to be the

exclusive entity for receipt and review of insurance product

filings. Nothing herein shall prohibit any insurer from filing its

product in any state wherein the insurer is licensed to conduct the

business of insurance; and any such filing shall be subject to the

laws of the state where filed.

2. The Commission is a body corporate and politic, and an

instrumentality of the compacting states.

3. The Commission is solely responsible for its liabilities

except as otherwise specifically provided in this Compact.

4. Venue is proper and judicial proceedings by or against the

Commission shall be brought solely and exclusively in a court of

competent jurisdiction where the principal office of the Commission

is located.

ARTICLE IV. POWERS OF THE COMMISSION

The Commission shall have the following powers:

1. To promulgate rules, pursuant to Article VII of this

Compact, which shall have the force and effect of law and shall be

binding in the compacting states to the extent and in the manner

provided in this Compact;

2. To exercise its rulemaking authority and establish

reasonable uniform standards for products covered under the Compact,

and advertisement related thereto, which shall have the force and

effect of law and shall be binding in the compacting states, but

only for those products filed with the Commission; provided, that a

compacting state shall have the right to opt out of such uniform

standard pursuant to Article VII of this Compact, to the extent and

Oklahoma Statutes - Title 36. Insurance Page 1464

in the manner provided in this Compact; and provided further, that

any uniform standard established by the Commission for long-term

care insurance products may provide the same or greater protections

for consumers as, but shall not provide less than, those protections

set forth in the National Association of Insurance Commissioners’
xtent and

Oklahoma Statutes - Title 36. Insurance Page 1464

in the manner provided in this Compact; and provided further, that

any uniform standard established by the Commission for long-term

care insurance products may provide the same or greater protections

for consumers as, but shall not provide less than, those protections

set forth in the National Association of Insurance Commissioners’

Long-Term Care Insurance Model Act and Long-Term Care Insurance

Model Regulation, respectively, adopted as of 2001. The Commission

shall consider whether any subsequent amendments to the NAIC Long-

Term Care Insurance Model Act or Long-Term Care Insurance Model

Regulation adopted by the NAIC require amending of the uniform

standards established by the Commission for long-term care insurance

products;

3. To receive and review in an expeditious manner products

filed with the Commission, and rate filings for disability income

and long-term care insurance products, and give approval of those

products and rate filings that satisfy the applicable uniform

standard, where such approval shall have the force and effect of law

and be binding on the compacting states to the extent and in the

manner provided in the Compact;

4. To receive and review in an expeditious manner advertisement

relating to long-term care insurance products for which uniform

standards have been adopted by the Commission, and give approval to

all advertisement that satisfies the applicable uniform standard.

For any product covered under this Compact, other than long-term

care insurance products, the Commission shall have the authority to

require an insurer to submit all or any part of its advertisement

with respect to that product for review or approval prior to use, if

the Commission determines that the nature of the product is such

that an advertisement of the product could have the capacity or

tendency to mislead the public. The actions of the Commission as

provided in this section shall have the force and effect of law and

shall be binding in the compacting states to the extent and in the

manner provided in the Compact;

5. To exercise its rulemaking authority and designate products

and advertisement that may be subject to a self-certification

process without the need for prior approval by the Commission;

6. To promulgate operating procedures, pursuant to Article VII

of this Compact, which shall be binding in the compacting states to

the extent and in the manner provided in this Compact;

7. To bring and prosecute legal proceedings or actions in its

name as the Commission; provided, that the standing of any state

insurance department to sue or be sued under applicable law shall

not be affected;

8. To issue subpoenas requiring the attendance and testimony of

witnesses and the production of evidence;

9. To establish and maintain offices;

10. To purchase and maintain insurance and bonds;

Oklahoma Statutes - Title 36. Insurance Page 1465

11. To borrow, accept or contract for services of personnel,

including, but not limited to, employees of a compacting state;

12. To hire employees, professionals or specialists, and elect

or appoint officers, and to fix their compensation, define their

duties and give them appropriate authority to carry out the purposes

of the Compact, and determine their qualifications; and to establish

the Commission’s personnel policies and programs relating to, among

other things, conflicts of interest, rates of compensation and

qualifications of personnel;

13. To accept any and all appropriate donations and grants of

money, equipment, supplies, materials and services, and to receive,

utilize and dispose of the same; provided, that at all times the

Commission shall strive to avoid any appearance of impropriety;

14. To lease, purchase, accept appropriate gifts or donations

of, or otherwise to own, hold, improve or use, any property, real,
onnel;

13. To accept any and all appropriate donations and grants of

money, equipment, supplies, materials and services, and to receive,

utilize and dispose of the same; provided, that at all times the

Commission shall strive to avoid any appearance of impropriety;

14. To lease, purchase, accept appropriate gifts or donations

of, or otherwise to own, hold, improve or use, any property, real,

personal or mixed; provided, that at all times the Commission shall

strive to avoid any appearance of impropriety;

15. To sell, convey, mortgage, pledge, lease, exchange, abandon

or otherwise dispose of any property, real, personal or mixed;

16. To remit filing fees to compacting states as may be set

forth in the bylaws, rules or operating procedures;

17. To enforce compliance by compacting states with rules,

uniform standards, operating procedures and bylaws;

18. To provide for dispute resolution among compacting states;

19. To advise compacting states on issues relating to insurers

domiciled or doing business in noncompacting jurisdictions,

consistent with the purposes of this Compact;

20. To provide advice and training to those personnel in state

insurance departments responsible for product review, and to be a

resource for state insurance departments;

21. To establish a budget and make expenditures;

22. To borrow money;

23. To appoint committees, including advisory committees

comprising members, state insurance regulators, state legislators or

their representatives, insurance industry and consumer

representatives, and such other interested persons as may be

designated in the bylaws;

24. To provide and receive information from, and to cooperate

with, law enforcement agencies;

25. To adopt and use a corporate seal; and

26. To perform such other functions as may be necessary or

appropriate to achieve the purposes of this Compact consistent with

the state regulation of the business of insurance.

ARTICLE V. ORGANIZATION OF THE COMMISSION

1. Membership, Voting and Bylaws:

a. Each compacting state shall have and be limited to one

member. Each member shall be qualified to serve in

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that capacity pursuant to applicable law of the

compacting state. Any member may be removed or

suspended from office as provided by the law of the

state from which he or she shall be appointed. Any

vacancy occurring in the Commission shall be filled in

accordance with the laws of the compacting state

wherein the vacancy exists. Nothing herein shall be

construed to affect the manner in which a compacting

state determines the election or appointment and

qualification of its own Commissioner.

b. Each member shall be entitled to one vote and shall

have an opportunity to participate in the governance

of the Commission in accordance with the bylaws.

Notwithstanding any provision herein to the contrary,

no action of the Commission with respect to the

promulgation of a uniform standard shall be effective

unless two-thirds (2/3) of the members vote in favor

thereof.

c. The Commission shall, by a majority of the members,

prescribe bylaws to govern its conduct as may be

necessary or appropriate to carry out the purposes,

and exercise the powers, of the Compact, including,

but not limited to:

i. Establishing the fiscal year of the Commission;

ii. Providing reasonable procedures for appointing

and electing members, as well as holding

meetings, of the Management Committee;

iii. Providing reasonable standards and procedures:

(1) for the establishment and meetings of other

committees, and
rry out the purposes,

and exercise the powers, of the Compact, including,

but not limited to:

i. Establishing the fiscal year of the Commission;

ii. Providing reasonable procedures for appointing

and electing members, as well as holding

meetings, of the Management Committee;

iii. Providing reasonable standards and procedures:

(1) for the establishment and meetings of other

committees, and

(2) governing any general or specific delegation

of any authority or function of the

Commission;

iv. Providing reasonable procedures for calling and

conducting meetings of the Commission that

consist of a majority of Commission members,

ensuring reasonable advance notice of each such

meeting and providing for the right of citizens

to attend each such meeting with enumerated

exceptions designed to protect the public’s

interest, the privacy of individuals, and

insurers’ proprietary information, including

trade secrets. The Commission may meet in camera

only after a majority of the entire membership

votes to close a meeting en toto or in part. As

soon as practicable, the Commission must make

public:

Oklahoma Statutes - Title 36. Insurance Page 1467

(1) a copy of the vote to close the meeting

revealing the vote of each member with no

proxy votes allowed, and

(2) votes taken during such meeting;

v. Establishing the titles, duties and authority and

reasonable procedures for the election of the

officers of the Commission;

vi. Providing reasonable standards and procedures for

the establishment of the personnel policies and

programs of the Commission. Notwithstanding any

civil service or other similar laws of any

compacting state, the bylaws shall exclusively

govern the personnel policies and programs of the

Commission;

vii. Promulgating a code of ethics to address

permissible and prohibited activities of

Commission members and employees; and

viii. Providing a mechanism for winding up the

operations of the Commission and the equitable

disposition of any surplus funds that may exist

after the termination of the Compact after the

payment and/or reserving of all of its debts and

obligations.

d. The Commission shall publish its bylaws in a

convenient form and file a copy thereof and a copy of

any amendment thereto with the appropriate agency or

officer in each of the compacting states.

2. Management Committee, Officers and Personnel

a. A Management Committee comprising no more than

fourteen members shall be established as follows:

i. One member from each of the six compacting states

with the largest premium volume for individual

and group annuities, life, disability income and

long-term care insurance products, determined

from the records of the NAIC for the prior year;

ii. Four members from those compacting states with at

least two percent (2%) of the market based on the

premium volume described above, other than the

six compacting states with the largest premium

volume, selected on a rotating basis as provided

in the bylaws; and

iii. Four members from those compacting states with

less than two percent (2%) of the market, based

on the premium volume described above, with one

selected from each of the four zone regions of

the NAIC as provided in the bylaws.

Oklahoma Statutes - Title 36. Insurance Page 1468

b. The Management Committee shall have such authority and

duties as may be set forth in the bylaws including,

but not limited to:

i. Managing the affairs of the Commission in a

manner consistent with the bylaws and purposes of

the Commission;

ii. Establishing and overseeing an organizational

structure within, and appropriate procedures for,

the Commission to provide for the creation of

uniform standards and other rules, receipt and

review of product filings, administrative and

technical support functions, review of decisions

regarding the disapproval of a product filing,

and the review of elections made by a compacting
mission;

ii. Establishing and overseeing an organizational

structure within, and appropriate procedures for,

the Commission to provide for the creation of

uniform standards and other rules, receipt and

review of product filings, administrative and

technical support functions, review of decisions

regarding the disapproval of a product filing,

and the review of elections made by a compacting

state to opt out of uniform standard; provided,

that a uniform standard shall not be submitted to

the compacting states for adoption unless

approved by two-thirds (2/3) of the members of

the Management Committee;

iii. Overseeing the offices of the Commission; and

iv. Planning, implementing, and coordinating

communications and activities with other state,

federal and local government organizations in

order to advance the goals of the Commission.

c. The Commission shall elect annually officers from the

Management Committee, with each having such authority

and duties as may be specified in the bylaws.

d. The Management Committee may, subject to the approval

of the Commission, appoint or retain an executive

director for such period, upon such terms and

conditions and for such compensation as the Commission

may deem appropriate. The executive director shall

serve as secretary to the Commission, but shall not be

a member of the Commission. The executive director

shall hire and supervise such other staff as may be

authorized by the Commission.

3. Legislative and Advisory Committees

a. A legislative committee comprising state legislators

or their designees shall be established to monitor the

operations of, and make recommendations to, the

Commission, including the Management Committee;

provided, that the manner of selection and term of any

legislative committee member shall be as set forth in

the bylaws. Prior to the adoption by the Commission

of any uniform standard, revision to the bylaws,

annual budget or other significant matter as may be

Oklahoma Statutes - Title 36. Insurance Page 1469

provided in the bylaws, the Management Committee shall

consult with and report to the legislative committee.

b. The Commission shall establish two advisory

committees, one of which shall comprise consumer

representatives independent of the insurance industry,

and the other comprising insurance industry

representatives.

c. The Commission may establish additional advisory

committees as its bylaws may provide for the carrying

out of its functions.

4. Corporate Records of the Commission

The Commission shall maintain its corporate books and records in

accordance with the bylaws.

5. Qualified Immunity, Defense and Indemnification

a. The members, officers, executive director, employees

and representatives of the Commission shall be immune

from suit and liability, either personally or in their

official capacity, for any claim for damage to or loss

of property or personal injury or other civil

liability caused by or arising out of any actual or

alleged act, error or omission that occurred, or that

the person against whom the claim is made had a

reasonable basis for believing occurred, within the

scope of Commission employment, duties or

responsibilities; provided, that nothing in this

paragraph shall be construed to protect any such

person from suit and/or liability for any damage,

loss, injury or liability caused by the intentional or

willful and wanton misconduct of that person.

b. The Commission shall defend any member, officer,

executive director, employee or representative of the

Commission in any civil action seeking to impose

liability arising out of any actual or alleged act,

error or omission that occurred within the scope of

Commission employment, duties or responsibilities, or

that the person against whom the claim is made had a

reasonable basis for believing occurred within the

scope of Commission employment, duties or

responsibilities; provided, that nothing herein shall
any civil action seeking to impose

liability arising out of any actual or alleged act,

error or omission that occurred within the scope of

Commission employment, duties or responsibilities, or

that the person against whom the claim is made had a

reasonable basis for believing occurred within the

scope of Commission employment, duties or

responsibilities; provided, that nothing herein shall

be construed to prohibit that person from retaining

his or her own counsel; and provided further, that the

actual or alleged act, error or omission did not

result from that person’s intentional or willful and

wanton misconduct.

c. The Commission shall indemnify and hold harmless any

member, officer, executive director, employee or

representative of the Commission for the amount of any

Oklahoma Statutes - Title 36. Insurance Page 1470

settlement or judgment obtained against that person

arising out of any actual or alleged act, error or

omission that occurred within the scope of Commission

employment, duties or responsibilities, or that such

person had a reasonable basis for believing occurred

within the scope of Commission employment, duties or

responsibilities, provided that the actual or alleged

act, error or omission did not result from the

intentional or willful and wanton misconduct of that

person.

ARTICLE VI. MEETINGS AND ACTS OF THE COMMISSION

1. The Commission shall meet and take such actions as are

consistent with the provisions of this Compact and the bylaws.

2. Each member of the Commission shall have the right and power

to cast a vote to which that compacting state is entitled and to

participate in the business and affairs of the Commission. A member

shall vote in person or by such other means as provided in the

bylaws. The bylaws may provide for members’ participation in

meetings by telephone or other means of communication.

3. The Commission shall meet at least once during each calendar

year. Additional meetings shall be held as set forth in the bylaws.

ARTICLE VII. RULES AND OPERATING PROCEDURES:

RULEMAKING FUNCTIONS OF THE COMMISSION AND

OPTING OUT OF UNIFORM STANDARDS

1. Rulemaking Authority. The Commission shall promulgate

reasonable rules, including uniform standards, and operating

procedures in order to effectively and efficiently achieve the

purposes of this Compact. Notwithstanding the foregoing, in the

event the Commission exercises its rulemaking authority in a manner

that is beyond the scope of the purposes of this act, or the powers

granted hereunder, then such an action by the Commission shall be

invalid and have no force and effect.

2. Rulemaking Procedure. Rules and operating procedures shall

be made pursuant to a rulemaking process that conforms to the Model

State Administrative Procedure Act of 1981 as amended, as may be

appropriate to the operations of the Commission. Before the

Commission adopts a uniform standard, the Commission shall give

written notice to the relevant state legislative committee(s) in

each compacting state responsible for insurance issues of its

intention to adopt the uniform standard. The Commission in adopting

a uniform standard shall consider fully all submitted materials and

issue a concise explanation of its decision.

3. Effective Date and Opt Out of a Uniform Standard. A uniform

standard shall become effective ninety (90) days after its

promulgation by the Commission or such later date as the Commission

may determine; provided, however, that a compacting state may opt

out of a uniform standard as provided in this Article. “Opt out”

Oklahoma Statutes - Title 36. Insurance Page 1471

shall be defined as any action by a compacting state to decline to

adopt or participate in a promulgated uniform standard. All other

rules and operating procedures, and amendments thereto, shall become

effective as of the date specified in each rule, operating procedure

or amendment.
f a uniform standard as provided in this Article. “Opt out”

Oklahoma Statutes - Title 36. Insurance Page 1471

shall be defined as any action by a compacting state to decline to

adopt or participate in a promulgated uniform standard. All other

rules and operating procedures, and amendments thereto, shall become

effective as of the date specified in each rule, operating procedure

or amendment.

4. Opt Out Procedure. A compacting state may opt out of a

uniform standard, either by legislation or regulation duly

promulgated by the Insurance Department under the compacting state’s

Administrative Procedure Act. If a compacting state elects to opt

out of a uniform standard by regulation, it must:

a. Give written notice to the Commission no later than

ten (10) business days after the uniform standard is

promulgated, or at the time the state becomes a

compacting state; and

b. Find that the uniform standard does not provide

reasonable protections to the citizens of the state,

given the conditions in the state. The Commissioner

shall make specific findings of fact and conclusions

of law, based on a preponderance of the evidence,

detailing the conditions in the state which warrant a

departure from the uniform standard and determining

that the uniform standard would not reasonably protect

the citizens of the state. The Commissioner must

consider and balance the following factors and find

that the conditions in the state and needs of the

citizens of the state outweigh:

i. The intent of the Legislature to participate in,

and the benefits of, an interstate agreement to

establish national uniform consumer protections

for the products subject to this act; and

ii. The presumption that a uniform standard adopted

by the Commission provides reasonable protections

to consumers of the relevant product.

Notwithstanding the foregoing, a compacting state may, at the time

of its enactment of this Compact, prospectively opt out of all

uniform standards involving long-term care insurance products by

expressly providing for such opt out in the enacted Compact, and

such an opt out shall not be treated as a material variance in the

offer or acceptance of any state to participate in this Compact.

Such an opt out shall be effective at the time of enactment of this

Compact by the compacting state and shall apply to all existing

uniform standards involving long-term care insurance products and

those subsequently promulgated.

5. Effect of Opt Out. If a compacting state elects to opt out

of a uniform standard, the uniform standard shall remain applicable

in the compacting state electing to opt out until such time the opt

Oklahoma Statutes - Title 36. Insurance Page 1472

out legislation is enacted into law or the regulation opting out

becomes effective.

Once the opt out of a uniform standard by a compacting state

becomes effective as provided under the laws of that state, the

uniform standard shall have no further force and effect in that

state unless and until the legislation or regulation implementing

the opt out is repealed or otherwise becomes ineffective under the

laws of the state. If a compacting state opts out of a uniform

standard after the uniform standard has been made effective in that

state, the opt out shall have the same prospective effect as

provided under Article XIV of this Compact for withdrawals.

6. Stay of Uniform Standard. If a compacting state has

formally initiated the process of opting out of a uniform standard

by regulation, and while the regulatory opt out is pending, the

compacting state may petition the Commission, at least fifteen (15)

days before the effective date of the uniform standard, to stay the

effectiveness of the uniform standard in that state. The Commission

may grant a stay if it determines the regulatory opt out is being

pursued in a reasonable manner and there is a likelihood of success.

If a stay is granted or extended by the Commission, the stay or
ing state may petition the Commission, at least fifteen (15)

days before the effective date of the uniform standard, to stay the

effectiveness of the uniform standard in that state. The Commission

may grant a stay if it determines the regulatory opt out is being

pursued in a reasonable manner and there is a likelihood of success.

If a stay is granted or extended by the Commission, the stay or

extension thereof may postpone the effective date by up to ninety

(90) days, unless affirmatively extended by the Commission;

provided, a stay may not be permitted to remain in effect for more

than one (1) year unless the compacting state can show extraordinary

circumstances which warrant a continuance of the stay, including,

but not limited to, the existence of a legal challenge which

prevents the compacting state from opting out. A stay may be

terminated by the Commission upon notice that the rulemaking process

has been terminated.

7. Not later than thirty (30) days after a rule or operating

procedure is promulgated, any person may file a petition for

judicial review of the rule or operating procedure; provided, that

the filing of such a petition shall not stay or otherwise prevent

the rule or operating procedure from becoming effective unless the

court finds that the petitioner has a substantial likelihood of

success. The court shall give deference to the actions of the

Commission consistent with applicable law and shall not find the

rule or operating procedure to be unlawful if the rule or operating

procedure represents a reasonable exercise of the Commission’s

authority.

ARTICLE VIII. COMMISSION RECORDS AND ENFORCEMENT

1. The Commission shall promulgate rules establishing

conditions and procedures for public inspection and copying of its

information and official records, except such information and

records involving the privacy of individuals and insurers’ trade

secrets. The Commission may promulgate additional rules under which

it may make available to federal and state agencies, including law

Oklahoma Statutes - Title 36. Insurance Page 1473

enforcement agencies, records and information otherwise exempt from

disclosure, and may enter into agreements with such agencies to

receive or exchange information or records subject to nondisclosure

and confidentiality provisions.

2. Except as to privileged records, data and information, the

laws of any compacting state pertaining to confidentiality or

nondisclosure shall not relieve any compacting state Commissioner of

the duty to disclose any relevant records, data or information to

the Commission; provided, that disclosure to the Commission shall

not be deemed to waive or otherwise affect any confidentiality

requirement; and further provided, that, except as otherwise

expressly provided in this act, the Commission shall not be subject

to the compacting state’s laws pertaining to confidentiality and

nondisclosure with respect to records, data and information in its

possession. Confidential information of the Commission shall remain

confidential after such information is provided to any Commissioner.

3. The Commission shall monitor compacting states for

compliance with duly adopted bylaws, rules, including uniform

standards, and operating procedures. The Commission shall notify

any noncomplying compacting state in writing of its noncompliance

with Commission bylaws, rules or operating procedures. If a

noncomplying compacting state fails to remedy its noncompliance

within the time specified in the notice of noncompliance, the

compacting state shall be deemed to be in default as set forth in

Article XIV of this Compact.

4. The Commissioner of any state in which an insurer is

authorized to do business, or is conducting the business of

insurance, shall continue to exercise his or her authority to

oversee the market regulation of the activities of the insurer in

accordance with the provisions of the state’s law. The
compacting state shall be deemed to be in default as set forth in

Article XIV of this Compact.

4. The Commissioner of any state in which an insurer is

authorized to do business, or is conducting the business of

insurance, shall continue to exercise his or her authority to

oversee the market regulation of the activities of the insurer in

accordance with the provisions of the state’s law. The

Commissioner’s enforcement of compliance with the Compact is

governed by the following provisions:

a. With respect to the Commissioner’s market regulation

of a product or advertisement that is approved or

certified to the Commission, the content of the

product or advertisement shall not constitute a

violation of the provisions, standards or requirements

of the Compact except upon a final order of the

Commission, issued at the request of a Commissioner

after prior notice to the insurer and an opportunity

for hearing before the Commission.

b. Before a Commissioner may bring an action for

violation of any provision, standard or requirement of

the Compact relating to the content of an

advertisement not approved or certified to the

Commission, the Commission, or an authorized

Commission officer or employee, must authorize the

Oklahoma Statutes - Title 36. Insurance Page 1474

action. However, authorization pursuant to this

paragraph does not require notice to the insurer,

opportunity for hearing or disclosure of requests for

authorization or records of the Commission’s action on

such requests.

ARTICLE IX. DISPUTE RESOLUTION

The Commission shall attempt, upon the request of a member, to

resolve any disputes or other issues that are subject to this

Compact and which may arise between two or more compacting states,

or between compacting states and noncompacting states, and the

Commission shall promulgate an operating procedure providing for

resolution of such disputes.

ARTICLE X. PRODUCT FILING AND APPROVAL

1. Insurers and third-party filers seeking to have a product

approved by the Commission shall file the product with, and pay

applicable filing fees to, the Commission. Nothing in this act

shall be construed to restrict or otherwise prevent an insurer from

filing its product with the insurance department in any state

wherein the insurer is licensed to conduct the business of

insurance, and such filing shall be subject to the laws of the

states where filed.

2. The Commission shall establish appropriate filing and review

processes and procedures pursuant to Commission rules and operating

procedures. Notwithstanding any provision herein to the contrary,

the Commission shall promulgate rules to establish conditions and

procedures under which the Commission will provide public access to

product filing information. In establishing such rules, the

Commission shall consider the interests of the public in having

access to such information, as well as protection of personal

medical and financial information and trade secrets, that may be

contained in a product filing or supporting information.

3. Any product approved by the Commission may be sold or

otherwise issued in those compacting states for which the insurer is

legally authorized to do business.

ARTICLE XI. REVIEW OF COMMISSION DECISIONS REGARDING FILINGS

1. Not later than thirty (30) days after the Commission has

given notice of a disapproved product or advertisement filed with

the Commission, the insurer or third-party filer whose filing was

disapproved may appeal the determination to a review panel appointed

by the Commission. The Commission shall promulgate rules to

establish procedures for appointing such review panels and provide

for notice and hearing. An allegation that the Commission, in

disapproving a product or advertisement filed with the Commission,

acted arbitrarily, capriciously, or in a manner that is an abuse of

discretion or otherwise not in accordance with the law, is subject
ted

by the Commission. The Commission shall promulgate rules to

establish procedures for appointing such review panels and provide

for notice and hearing. An allegation that the Commission, in

disapproving a product or advertisement filed with the Commission,

acted arbitrarily, capriciously, or in a manner that is an abuse of

discretion or otherwise not in accordance with the law, is subject

to judicial review in accordance with Section 4 of Article III of

this Compact.

Oklahoma Statutes - Title 36. Insurance Page 1475

2. The Commission shall have authority to monitor, review and

reconsider products and advertisement subsequent to their filing or

approval upon a finding that the product does not meet the relevant

uniform standard. Where appropriate, the Commission may withdraw or

modify its approval after proper notice and hearing, subject to the

appeal process in Section 1 of this article.

ARTICLE XII. FINANCE

1. The Commission shall pay or provide for the payment of the

reasonable expenses of its establishment and organization. To fund

the cost of its initial operations, the Commission may accept

contributions and other forms of funding from the National

Association of Insurance Commissioners, compacting states and other

sources. Contributions and other forms of funding from other

sources shall be of such a nature that the independence of the

Commission concerning the performance of its duties shall not be

compromised.

2. The Commission shall collect a filing fee from each insurer

and third-party filer filing a product with the Commission to cover

the cost of the operations and activities of the Commission and its

staff in a total amount sufficient to cover the Commission’s annual

budget.

3. The Commission’s budget for a fiscal year shall not be

approved until it has been subject to notice and comment as set

forth in Article VII of this Compact.

4. The Commission shall be exempt from all taxation in and by

the compacting states.

5. The Commission shall not pledge the credit of any compacting

state, except by and with the appropriate legal authority of that

compacting state.

6. The Commission shall keep complete and accurate accounts of

all its internal receipts, including grants and donations, and

disbursements of all funds under its control. The internal

financial accounts of the Commission shall be subject to the

accounting procedures established under its bylaws. The financial

accounts and reports including the system of internal controls and

procedures of the Commission shall be audited annually by an

independent certified public accountant. Upon the determination of

the Commission, but no less frequently than every three (3) years,

the review of the independent auditor shall include a management and

performance audit of the Commission. The Commission shall make an

annual report to the Governor and Legislature of the compacting

states, which shall include a report of the independent audit. The

Commission’s internal accounts shall not be confidential and such

materials may be shared with the Commissioner of any compacting

state upon request; provided, however, that any work papers related

to any internal or independent audit and any information regarding

Oklahoma Statutes - Title 36. Insurance Page 1476

the privacy of individuals and insurers’ proprietary information,

including trade secrets, shall remain confidential.

7. No compacting state shall have any claim to or ownership of

any property held by or vested in the Commission or to any

Commission funds held pursuant to the provisions of this Compact.

ARTICLE XIII. COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT

1. Any state is eligible to become a compacting state.

2. The Compact shall become effective and binding upon

legislative enactment of the Compact into law by two compacting

states; provided, the Commission shall become effective for purposes
he Commission or to any

Commission funds held pursuant to the provisions of this Compact.

ARTICLE XIII. COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT

1. Any state is eligible to become a compacting state.

2. The Compact shall become effective and binding upon

legislative enactment of the Compact into law by two compacting

states; provided, the Commission shall become effective for purposes

of adopting uniform standards for, reviewing, and giving approval or

disapproval of, products filed with the Commission that satisfy

applicable uniform standards only after twenty-six (26) states are

compacting states or, alternatively, by states representing greater

than forty percent (40%) of the premium volume for life insurance,

annuity, disability income and long-term care insurance products,

based on records of the NAIC for the prior year. Thereafter, it

shall become effective and binding as to any other compacting state

upon enactment of the Compact into law by that state.

3. Amendments to the Compact may be proposed by the Commission

for enactment by the compacting states. No amendment shall become

effective and binding upon the Commission and the compacting states

unless and until all compacting states enact the amendment into law.

ARTICLE XIV. WITHDRAWAL, DEFAULT AND TERMINATION

1. Withdrawal

a. Once effective, the Compact shall continue in force

and remain binding upon each and every compacting

state; provided, that a compacting state may withdraw

from the Compact (“withdrawing state”) by enacting a

statute specifically repealing the statute which

enacted the Compact into law.

b. The effective date of withdrawal is the effective date

of the repealing statute. However, the withdrawal

shall not apply to any product filings approved or

self-certified, or any advertisement of such products,

on the date the repealing statute becomes effective,

except by mutual agreement of the Commission and the

withdrawing state unless the approval is rescinded by

the withdrawing state as provided in paragraph e of

this section.

c. The Commissioner of the withdrawing state shall

immediately notify the Management Committee in writing

upon the introduction of legislation repealing this

Compact in the withdrawing state.

d. The Commission shall notify the other compacting

states of the introduction of such legislation within

ten (10) days after its receipt of notice thereof.

Oklahoma Statutes - Title 36. Insurance Page 1477

e. The withdrawing state is responsible for all

obligations, duties and liabilities incurred through

the effective date of withdrawal, including any

obligations, the performance of which extend beyond

the effective date of withdrawal, except to the extent

those obligations may have been released or

relinquished by mutual agreement of the Commission and

the withdrawing state. The Commission’s approval of

products and advertisement prior to the effective date

of withdrawal shall continue to be effective and be

given full force and effect in the withdrawing state,

unless formally rescinded by the withdrawing state in

the same manner as provided by the laws of the

withdrawing state for the prospective disapproval of

products or advertisement previously approved under

state law.

f. Reinstatement following withdrawal of any compacting

state shall occur upon the effective date of the

withdrawing state reenacting the Compact.

2. Default

a. If the Commission determines that any compacting state

has at any time defaulted (“defaulting state”) in the

performance of any of its obligations or

responsibilities under this Compact, the bylaws or

duly promulgated rules or operating procedures, then,

after notice and hearing as set forth in the bylaws,

all rights, privileges and benefits conferred by this

Compact on the defaulting state shall be suspended

from the effective date of default as fixed by the

Commission. The grounds for default include, but are
any of its obligations or

responsibilities under this Compact, the bylaws or

duly promulgated rules or operating procedures, then,

after notice and hearing as set forth in the bylaws,

all rights, privileges and benefits conferred by this

Compact on the defaulting state shall be suspended

from the effective date of default as fixed by the

Commission. The grounds for default include, but are

not limited to, failure of a compacting state to

perform its obligations or responsibilities, and any

other grounds designated in Commission rules. The

Commission shall immediately notify the defaulting

state in writing of the defaulting state’s suspension

pending a cure of the default. The Commission shall

stipulate the conditions and the time period within

which the defaulting state must cure its default. If

the defaulting state fails to cure the default within

the time period specified by the Commission, the

defaulting state shall be terminated from the Compact

and all rights, privileges and benefits conferred by

this Compact shall be terminated from the effective

date of termination.

b. Product approvals by the Commission or product self-

certifications, or any advertisement in connection

with such product, that is in force on the effective

Oklahoma Statutes - Title 36. Insurance Page 1478

date of termination shall remain in force in the

defaulting state in the same manner as if the

defaulting state had withdrawn voluntarily pursuant to

Section 1 of this article.

c. Reinstatement following termination of any compacting

state requires a reenactment of the Compact.

3. Dissolution of Compact

a. The Compact dissolves effective upon the date of the

withdrawal or default of the compacting state which

reduces membership in the Compact to one compacting

state.

b. Upon the dissolution of this Compact, the Compact

becomes null and void and shall be of no further force

or effect, and the business and affairs of the

Commission shall be wound up and any surplus funds

shall be distributed in accordance with the bylaws.

ARTICLE XV. SEVERABILITY AND CONSTRUCTION

1. The provisions of this Compact shall be severable; and if

any phrase, clause, sentence or provision is deemed unenforceable,

the remaining provisions of the Compact shall be enforceable.

2. The provisions of this Compact shall be liberally construed

to effectuate its purposes.

ARTICLE XVI. BINDING EFFECT OF COMPACT AND OTHER LAWS

1. Other Laws

a. Nothing herein prevents the enforcement of any other

law of a compacting state, except as provided in

paragraph b of this section.

b. For any product approved or certified to the

Commission, the rules, uniform standards and any other

requirements of the Commission shall constitute the

exclusive provisions applicable to the content,

approval and certification of such products. For

advertisement that is subject to the Commission’s

authority, any rule, uniform standard or other

requirement of the Commission which governs the

content of the advertisement shall constitute the

exclusive provision that a Commissioner may apply to

the content of the advertisement. Notwithstanding the

foregoing, no action taken by the Commission shall

abrogate or restrict:

i. the access of any person to state courts,

ii. remedies available under state law related to

breach of contract, tort, or other laws not

specifically directed to the content of the

product,

iii. state law relating to the construction of

insurance contracts, or

Oklahoma Statutes - Title 36. Insurance Page 1479

iv. the authority of the Attorney General of the

state including, but not limited to, maintaining

any actions or proceedings, as authorized by law.

c. All insurance products filed with individual states

shall be subject to the laws of those states.

2. Binding Effect of this Compact

a. All lawful actions of the Commission, including all

rules and operating procedures promulgated by the
1479

iv. the authority of the Attorney General of the

state including, but not limited to, maintaining

any actions or proceedings, as authorized by law.

c. All insurance products filed with individual states

shall be subject to the laws of those states.

2. Binding Effect of this Compact

a. All lawful actions of the Commission, including all

rules and operating procedures promulgated by the

Commission, are binding upon the compacting states.

b. All agreements between the Commission and the

compacting states are binding in accordance with their

terms.

c. Upon the request of a party to a conflict over the

meaning or interpretation of Commission actions, and

upon a majority vote of the compacting states, the

Commission may issue advisory opinions regarding the

meaning or interpretation in dispute.

d. In the event any provision of the Compact exceeds the

constitutional limits imposed on the Legislature of

any compacting state, the obligations, duties, powers

or jurisdiction sought to be conferred by that

provision upon the Commission shall be ineffective as

to that compacting state, and those obligations,

duties, powers or jurisdiction shall remain in the

compacting state and shall be exercised by the agency

thereof to which those obligations, duties, powers or

jurisdiction are delegated by law in effect at the

time this Compact becomes effective.