# Title 26.1 — Insurance

## Chapter 26.1-59 — Interstate Insurance Product Regulation Compact

### § 26.1-59-01. Interstate insurance product regulation compact.

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
7. To perform these and such other related functions as may be consistent with the state
regulation of the business of insurance.
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" mean 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which has not withdrawn pursuant to subsection 1 of article XIV, or been terminated
pursuant to subsection 2 of article XIV.
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 chapter.
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" mean 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 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.

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.
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.
1. The compacting states hereby create and establish a joint public agency known as the
"interstate insurance product regulation commission". Pursuant to article IV, 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.
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, to the extent
and 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 national association of insurance
commissioners' long-term care insurance model act or long-term care insurance model
regulation adopted by the national association of insurance commissioners 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;
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, 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.
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 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 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:
(1) Establishing the fiscal year of the commission;
(2) Providing reasonable procedures for appointing and electing members, as
well as holding meetings, of the management committee;
(3) Providing reasonable standards and procedures:
a. For the establishment and meetings of other committees; and
b. Governing any general or specific delegation of any authority or
function of the commission;
(4) Providing reasonable procedures for calling and conducting meetings of the
commission that consists 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:
a. A copy of the vote to close the meeting revealing the vote of each
member with no proxy votes allowed; and
b. Votes taken during such meeting;
(5) Establishing the titles, duties, and authority and reasonable procedures for
the election of the officers of the commission;
(6) 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;
(7) Promulgating a code of ethics to address permissible and prohibited
activities of commission members and employees; and
(8) 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:
(1) 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
national association of insurance commissioners for the prior year;
(2) Four members from those compacting states with at least two percent 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
(3) Four members from those compacting states with less than two percent of
the market, based on the premium volume described above, with one
selected from each of the four zone regions of the national association of
insurance commissioners as provided in the bylaws.
b. The management committee shall have such authority and duties as may be set
forth in the bylaws, including but not limited to:
(1) Managing the affairs of the commission in a manner consistent with the
bylaws and purposes of the commission;
(2) 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 a uniform standard, provided that a uniform
standard shall not be submitted to the compacting states for adoption unless
approved by two-thirds of the members of the management committee;
(3) Overseeing the offices of the commission; and
(4) 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
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 subdivision
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 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 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.
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.
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 chapter, 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 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" 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. 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 give written notice to the commission no
later than ten business days after the uniform standard is promulgated, or at the
time the state becomes a compacting state and must 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 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 chapter and 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.
b. In accordance with subdivision a, North Dakota opts out of all existing and
prospective uniform standards involving long-term care insurance products in
order to preserve North Dakota's statutory requirements governing long-term care
insurance products.
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-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 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 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 days, unless affirmatively
extended by the commission, provided a stay may not be permitted to remain in effect
for more than one 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 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.
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 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 chapter, 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.
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 action. However,

authorization pursuant to this subdivision 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.
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.
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 chapter 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.
1. Not later than thirty 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 to judicial review in
accordance with subsection 4 of article III.
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 subsection 1.
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 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 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.
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 states are compacting states or, alternatively,
by states representing greater than forty percent of the premium volume for life
insurance, annuity, disability income, and long-term care insurance products, based on
records of the national association of insurance commissioners 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.
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 subdivision e.
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 days after its receipt of notice thereof.
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 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 are in force on the effective
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
subsection 1.
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.
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.
1. Other laws.
a. Nothing herein prevents the enforcement of any other law of a compacting state,
except as provided in subdivision b.
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:
(1) The access of any person to state courts;
(2) Remedies available under state law related to breach of contract, tort, or
other laws not specifically directed to the content of the product;
(3) State law relating to the construction of insurance contracts; or
(4) 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 this 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.
