Chapter 086

2013 -- H 5459 SUBSTITUTE A

Enacted 06/17/13





     Introduced By: Representatives Finn, and Edwards

     Date Introduced: February 14, 2013


It is enacted by the General Assembly as follows:


     SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended

by adding thereto the following chapter:





     27-8.2-1. Purpose and intent. -- This chapter shall be known as the "Stop-Loss

Insurance Act." The purpose of this chapter is to establish criteria for the issuance of stop-loss

insurance policies. Nothing in this chapter shall be construed as imposing any requirement or

duty on any person other than an insurer, or as treating any stop-loss policy as a direct policy of

health insurance.


     27-8.2-2. Definitions. -- (a) "Actuarial certification" means a written statement by a

member of the American Academy of Actuaries, or other individual acceptable to the

commissioner, that an insurer is in compliance with the provisions of this chapter. The written

statement shall be based upon the individualís examination, and include a review of the

appropriate records and the actuarial assumptions and methods used by the insurer in establishing

attachment points and other applicable determinations in conjunction with the provision of stop-

loss insurance coverage.

     (b) "Attachment point" means the claims amount incurred by an insured group beyond

which the insurer incurs a liability for payment.

     (c) "Expected claims" means the amount of claims that, in the absence of a stop-loss

policy or other insurance, are projected to be incurred by an insured group through its health plan.


     27-8.2-3. Stop-loss insurance coverage standards. -- (a) An insurer shall not issue a

stop-loss insurance policy that:

     (1) Has an annual attachment point for claims incurred per individual that is lower than

twenty thousand dollars ($20,000);

     (2) Has an annual aggregate attachment point that is lower than one hundred twenty

percent (120%) of expected claim; and

     (3) Provides direct coverage of health care expenses of an individual.

     (b) The commissioner may adopt rules that carry out the requirements of this chapter.


     27-8.2-4. Actuarial certification. -- An insurer shall file with the commissioner annually

on or before March 15, an actuarial certification certifying that the insurer is in compliance with

this chapter. The certification shall be in a form and manner, and shall contain information,

specified by the commissioner. A copy of the certification shall be retained by the insurer at its

principal place of business.


     27-8.2-5. Effective date. -- This chapter shall become effective with respect to stop-loss

insurance policies issued or renewed on or after January 1, 2014.


     SECTION 2. This act shall take effect upon passage.



LC01262/SUB A