OMNIBUS INSURANCE BILL

Enrolled SB 132
LAWS OF ALASKA

2025

Source Chapter No.
HCS CSSB 132(FIN) am H _______

AN ACT

Relating to insurance; and providing for an effective date.

_______________

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:

THE ACT FOLLOWS ON PAGE 1

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AN ACT

Relating to insurance; and providing for an effective date. 1
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* Section 1. AS 12.10.020 is amended by adding a new subsection to read: 3
(d) Even if the general time limitation has expired, a prosecu tion for any 4
offense related to life insurance may be commenced within one y ear after discovery of 5
the offense by an aggrieved party or by a person who has legal capacity to represent an 6
aggrieved party or a legal duty to report the offense and who i s not a party to the 7
offense, but in no case shall this provision extend the period of limitation otherwise 8
applicable by more than 20 years. 9
* Sec. 2. AS 21.06.120(a) is amended to read: 10
(a) The director may examine th e affairs, transactions, accoun ts, records, and 11
assets of each authorized and formerly authorized insurer and e ach licensed and 12
formerly licensed managing general agent, reinsurance intermedi ary broker, 13
reinsurance intermediary manager, surplus lines broker, pharmacy benefits manager, 14
and surplus lines association as often as the director considers advisable. In scheduling 15

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and determining the nature, scop e, and frequency of examination s , th e d ir e c to r may 1
consider any factor or material that the director determines is appropriate, including 2
the results of financial statement analysis and ratios, compete ncy of management or 3
change of ownership, actuarial opinions, reports of independent certified public 4
accountants, number and nature of consumer complaints, results of prior examinations, 5
frequency of prior violations of statute and regulation, and cr iteria set out in the most 6
recent edition of the Financial Condition Examiners Handbook an d the Market 7
Regulation Handbook approved by the National Association of Ins urance 8
Commissioners and in effect when th e director conducts an examination. Examination 9
of an alien insurer may be limited to its insurance transactions and affairs in the United 10
States. Examination of a recipro cal insurer may also include ex amination of its 11
attorney-in-fact to the extent that the transactions of the att orney-in-fact relate to the 12
insurer. 13
* Sec. 3. AS 21.06.120(d) is amended to read: 14
( d ) T h e d i r e c t o r m a y e x a m i n e i n s u r e r s, third-party administrators, and 15
pharmacy benefits managers in participation with the National Association of 16
Insurance Commissioners. 17
* Sec. 4. AS 21.06.120 is amended by adding a new subsection to read: 18
(h) The director may examine a third-party administrator or pharmacy benefits 19
manager any time the director determines that an examination or investigation is 20
necessary. 21
* Sec. 5. AS 21.06.160(a) is amended to read: 22
(a) Each person examined, other than examinations under AS 21. 06.130 and 23
examinations of managing general agents, [THIRD-PARTY ADMINISTR ATORS,] 24
reinsurance intermediary managers, motor vehicle service contra ct providers, or 25
surplus lines brokers, shall pay a reasonable rate calculated o n salary, benefit costs, 26
and estimated division overhead for time spent directly or indi rectly related to the 27
examination. Each person examin ed, other than examinations unde r AS 21.06.130, 28
shall pay actual out-of-pocket business expenses, including tra vel expenses, incurred 29
by division staff examiners and shall pay the compensation of a contract examiner, to 30
be set at a reasonable customary rate, for conducting the exami nation upon 31

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presentation of a detailed account of the charges and expenses by the director or under 1
an order of the director. The director may waive payment of all or part of the actual 2
out-of-pocket business expenses i ncurred by division staff exam iners, or the 3
compensation of a contract examiner, if the director determines that payment of the 4
expenses or compensation creates a financial hardship for a man aging general agent, 5
third-party administrator, reinsurance intermediary manager, mo tor vehicle service 6
contract provider, or surplus lines broker. The accounting may either be presented 7
periodically during the course of the examination or at the ter mination of the 8
examination. A person may not pay and an examiner may not accep t additional 9
compensation for an examination. A person shall pay examination expenses to the 10
division under this subsection using an electronic payment meth od specified by the 11
director. 12
* Sec. 6. AS 21.07.030(a) is amended to read: 13
(a) If a health care insurer offers a health care insurance po licy that provides 14
for coverage of medical care services only if the services are furnished through a 15
network of health care providers t hat have entered into a contr act with the health care 16
insurer, the health care insurer shall also offer a non-network option to covered 17
persons at initial enrollment, as provided under (c) of this se ction. The non-network 18
option may require that a covered person pay a higher deductibl e, copayment, or 19
premium for the plan if the higher deductible, copayment, or pr emium results from 20
increased costs caused by the use of a non-network provider. Th is subsection does not 21
apply to 22
(1) a covered person who is offered non-network coverage through 23
another health care insurance policy or through another health care insurer; or 24
(2) a health maintenance organization licensed under AS 21.86. 25
* Sec. 7. AS 21.07.030 is amended by adding a new subsection to read: 26
(i) A health care insurer that offers a health care insurance policy that provides 27
different levels of coverage for health care services based on network status and 28
performs utilization review shall include details on a prior au thorization request form 29
on how a health care provider or c overed person may request a b enefit-level 30
exception. If the health care insurer approves the prior author ization, the insurer shall 31

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detail whether the claim will be processed as a network or non- network claim. If the 1
benefit will be paid based on a non-network reimbursement level and a benefit-level 2
exception requires an application process separate from the pri or authorization 3
process, the prior authorization must include instructions for requesting the benefit-4
level exception. In this subsection, a "benefit-level exception " means an exception to 5
medical care coverage where a health care insurer applies netwo rk health care benefit 6
levels to services received from an out-of-network health care provider or facility. 7
* Sec. 8. AS 21.09.200(g) is amended to read: 8
(g) An insurer shall file with the director or the director's designee an annual 9
audited financial re port for the previous year by June 1 of eac h year [UNLESS, 10
UNDER A REGULATION ADOPTED BY THE DIRECTOR, THE DIRECTOR 11
GRANTS AN EXEMPTION BASED ON A FINDING THAT FILING AN 12
ANNUAL AUDITED FINANCIAL REPORT WOULD CONSTITUTE A 13
FINANCIAL OR ORGANIZATIONAL HARDSHIP ON THE INSURER. THE 14
FILING DATE FOR THE ANNUAL AUDITED FINANCIAL REPORT MAY BE 15
EXTENDED BY THE DIRECTOR UPON SHOWING THAT THE STANDARDS 16
ESTABLISHED BY REGULATION HAVE BEEN MET]. If the director gives the 17
insurer 90 days' advance notice, and for good cause, the direct o r m a y r e q u i r e a n 18
insurer to file an audited financial report earlier than June 1 of each year. The annual 19
audited financial report must be prepared by a qualified indepe ndent certified public 20
accountant. An insurer shall notify the director of the certifi ed public accountant 21
engaged to conduct the audit and issue the annual audited financial report. 22
* Sec. 9. AS 21.09.200 is amended by adding a new subsection to read: 23
(m) An insurer may apply to the director for an exemption from compliance 24
with a requirement of this secti on if compliance would cause th e insurer to suffer a 25
financial or organizational hard ship. The director may, in the director's discretion, 26
approve an exemption. If the director denies an insurer's application for exemption, the 27
insurer may, within 15 days after the date of the denial, submi t a request in writing to 28
the director for a hearing as provided under AS 21.06.180 - 21.06.240. 29
* Sec. 10. AS 21.09.210(b) is amended to read: 30
(b) Each insurer, and each formerly authorized insurer with re spect to 31

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premiums written while an authorized insurer in this state, sha ll pay a tax on the total 1
direct premium written during the year ending on the preceding December 31 and paid 2
for the insurance of property or risks resident or located in t he state [, OTHER THAN 3
WET MARINE AND TRANSPORTATION INSURANCE,] after deducting from the 4
total direct premium income the applicable cancellations, retur ned premiums, the 5
unabsorbed portion of any depos it premium, all policy dividends , unabsorbed 6
premiums refunded to policyholders, refunds, savings, savings c oupons, and other 7
similar returns paid or credited to policyholders with respect to their policies. 8
Deductions may not be made of ca sh surrender value of policies. Considerations 9
received on annuity contracts are not included in the direct pr emium income and are 10
not subject to tax. The tax shall be paid to the director at le ast annually but not more 11
often than once each quarter on the dates specified by the dire ctor. The method of 12
payment must be by the electr onic or other payment method speci fied by the director. 13
Except as provided under (m) of this section, the tax is computed at the rate of 14
(1) for domestic and foreign insurers, except hospital and med ical 15
service corporations, 2.7 percent; 16
(2) for hospital and medical ser vice corporations, six percent of their 17
gross premiums less claims paid; 18
(3) for wet marine and transportation insurance, three-quarters of 19
one percent. 20
* Sec. 11. AS 21.09.242(a) is amended to read: 21
(a) Each [AN] insurer and [, INCLUDING A] pharmacy benefits manager 22
shall, with respect to a medical assistance program [PROGRAMS] under AS 47.07, 23
[SHALL] cooperate with the Department of Health to 24
(1) provide, with respect to an individual who is eligible for o r i s 25
provided medical assistance under AS 47.07, at [ON] the request of the department, 26
information to determine during what period the individual or t he individual's spouse 27
or dependents may be or may have been covered by the insurer an d the nature of the 28
coverage that is or was provided by the insurer, including the name and address of the 29
insurer and the identifying number of the health care insurance plan; 30
(2) accept the department's right of recovery and the assignme nt to the 31

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department of any right of an i ndividual or other entity to pay ment from the party for 1
an item or service for which payment has been made under AS 47.07; 2
(3) respond within 60 days to any inquiry by the department regarding 3
a claim for payment for any health care item or service that is submitted not later than 4
three years after the date of the provision of the health care item or service; and 5
(4) agree not to deny a claim submitted by the department solely on the 6
basis of the date of submission of the claim, the type or forma t of the claim form, a 7
failure to obtain prior authorization, or a failure to present proper documentation at 8
the point-of-sale that is the basis of the claim if 9
(A) the claim is submitted by the department within the three-10
year period beginning on the date on which the item or service was furnished; 11
and 12
(B) any action by the department to enforce its rights with 13
respect to the claim is commenced within six years after the de partment's 14
submission of the claim. 15
* Sec. 12. AS 21.12.020(h) is amended to read: 16
(h) The director shall consider the list of reciprocal jurisdi ctions published 17
through the National Association of Insurance Commissioners com mittee process in 18
determining a reciprocal jurisdi ction and has the discretion to defer to the list. The 19
director may approve a jurisdiction not on the list in accordan ce with criteria 20
developed under regulations adopted by the director. The direct o r m a y r e m o v e a 21
jurisdiction from the list of reciprocal jurisdictions upon det ermination that the 22
jurisdiction no longer meets the requirements of a reciprocal jurisdiction in accordance 23
with a process set out in regulation by the director. Upon remo val of a reciprocal 24
jurisdiction from the list, credit for reinsurance ceded to an assuming insurer that has a 25
home office or is domiciled in that jurisdiction shall be allow ed if otherwise allowed 26
under this section. The director shall timely create and publis h a list of assuming 27
insurers that have satisfied the conditions set out in this sub section and to which 28
cessions shall be granted credit in accordance with (a) of this section. The director 29
may add an assuming insurer to a list if a National Association o f I n s u r a n c e 30
Commissioners accredited jurisdiction has added the assuming in surer to a list of 31

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assuming insurers or, if upon in itial eligibility, the assuming insurer submits the 1
information to the director as required under (a)(6)(D) of this section and complies 2
with any additional requirements the director may impose by regulation. If the director 3
determines that an assuming insurer no longer meets one or more of the requirements 4
of (a)(6) of this section, the director may revoke or suspend t he eligibility of the 5
assuming insurer under (a)(6) of t his section in accordance wit h procedures set out in 6
regulation. While an assuming insurer's eligibility is suspende d, a reinsurance 7
agreement issued, amended, or renewed after the effective date of the suspension does 8
not qualify for credit except to the extent that the assuming i nsurer's obligations under 9
the contract are secured in accordance with (c) of this section . If an assuming insurer's 10
eligibility is revoked, a credit for reinsurance may not be gra n te d a f te r th e e f fe c tiv e 11
date of the revocation with respect to any reinsurance agreemen t entered into by the 12
assuming insurer, including a reinsurance agreement entered int o before the date of 13
revocation, except to the extent that the assuming insurer's ob ligations under the 14
contract are secured in a form a cceptable to the director and c onsistent with (c) of this 15
section. Upon entry of an orde r of rehabilitation, liquidation, or conservation against 16
the ceding insurer, the supervising court may [SHALL ] require an assuming insurer 17
under (a)(6) of this section to post 100 percent security for t he benefit of the ceding 18
insurer or its estate. Nothing in this subsection shall limit o r in any way alter the 19
capacity of parties to a reinsurance agreement to agree on requ irements for security or 20
other terms in that reinsurance agreement consistent with this section. Credit under 21
(a)(6) of this section may be taken only for reinsurance agreem ents entered into, 22
renewed, or amended on or after the date the director has determined that the assuming 23
insurer is eligible for credit, and may not be taken for reinsu rance of losses incurred or 24
reserves reported before that date. Credit under (a)(6) of this section may not apply to 25
reinsurance agreements entered into, to losses incurred, or to reserves posted before 26
application under (a)(6) of this section. 27
* Sec. 13. AS 21.12.020(i)(2) is amended to read: 28
(2) "reciprocal jurisdiction" means a jurisdiction that 29
(A) is not a United States jurisdiction that is subject to an in- 30
force covered agreement with the United States, each within its legal authority, 31

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or in the case of a covered agreement between the United States and the 1
European Union, is a member stat e of the European Union; in thi s 2
subparagraph, "covered agreement" is an agreement entered into under 31 3
U.S.C. 313 - 314 (Dodd-Frank Wall Street Reform and Consumer Pr otection 4
Act) that is currently in effect or in a period of provisional application and 5
addresses the elimination, under specified conditions, of colla teral 6
requirements as a condition for entering into any reinsurance a greement with a 7
ceding insurer domiciled in this state or for allowing the cedi ng insurer to 8
recognize credit for reinsurance; 9
(B) is a United States jurisdic tion that meets the requirement s 10
for accreditation under the National Association of Insurance C ommissioners 11
financial standards and accreditation program; or 12
(C) is a qualified jurisdiction, as determined by the director 13
under (a)(5)(C) of this section, that is not otherwise described in (A) and (B) of 14
this paragraph and that meets certain additional requirements, consistent with 15
the terms and conditions of in-force covered agreements, as spe cified by the 16
director in regulation; 17
* Sec. 14. AS 21.18.112(e) is amended to read: 18
(e) An insurer shall establish reserves using a principle-base d valuation that 19
meets the following conditions for policies or contracts as spe cified in the valuation 20
manual: 21
(1) quantify the benefits, guarantees, and funding associated with the 22
contracts and their risks at a level of conservatism that refle cts conditions that include 23
unfavorable events that have a reasonable probability of occurr ing during the lifetime 24
of the contracts and, for policies or contracts with significan t tail risk, that reflect 25
conditions appropriately adverse to quantify the tail risk; 26
(2) incorporate assumptions, ri sk analysis methods, and financ ial 27
models and management techniques that are consistent with, but not necessarily 28
identical to, those used in the insurer's overall risk assessme nt process while 29
recognizing potential differences in financial reporting struct u r e s a n d p r e s c r i b e d 30
assumptions or methods; 31

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(3) incorporate assumptions that are derived in one of the fol lowing 1
manners: 2
(A) the assumptions are prescribed in the valuation manual; 3
(B) for assumptions that are not prescribed, the assumptions 4
shall be established using the insurer's available experience, to the extent it is 5
relevant and statistically credibl e; to the extent that data is not available, 6
relevant, or statistically credi ble, the assumptions shall be e stablished using 7
other relevant or statistically credible experience; 8
(4) provide margins for uncertainty, including adverse deviati on and 9
estimation error, so that the greater the uncertainty the large r the margin and resulting 10
reserve; 11
(5) for an insurer using a prin ciple-based valuation for one o r more 12
policies or contracts subject to this subsection as specified in the valuation manual, 13
(A) establish procedures for corporate governance and 14
oversight of the actuarial valua tion function consistent with t hose described in 15
the valuation manual and a process for appropri ate waiver or modification 16
of the established procedures; 17
(B) provide to the director an annual certification of the 18
effectiveness of the internal c ontrols with respect to the prin ciple-based 19
valuation; the controls shall be designed to ensure that all ma terial risks 20
inherent in the liabilities and associated assets subject to th e valuation are 21
included in the valuation and that valuations are made in accor dance with the 22
valuation manual; the certification shall be based on the contr ols in place as of 23
the end of the preceding calendar year; 24
(C) develop and file with the director upon request a principl e-25
based valuation report that complies with standards prescribed in the valuation 26
manual; 27
(6) a principle-based valuation may include a prescribed formu laic 28
reserve component. 29
* Sec. 15. AS 21.18.900(12) is amended to read: 30
(12) "policyholder behavior" means a lapse, withdrawal, transfer, 31

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deposit, premium payment, loan, annuitization, or election of a policy benefit by 1
the terms of a policy or contract, or another [AN] action of a policyholder, contract 2
holder, or another person with the right to elect options ; "policyholder behavior" 3
does not include events of mortality or morbidity that result i n a benefit 4
prescribed by the terms of a policy or contract; 5
* Sec. 16. AS 21.27.010(a) is amended to read: 6
(a) Except as provided otherwise in this chapter, a person may not act as or 7
represent to be an insurance producer, managing general agent, reinsurance 8
intermediary broker, reinsurance intermediary manager, surplus lines broker, third-9
party administrator, pharmacy benefits manager, or independent adjuster in this 10
state or relative to a subject resident, located, or to be perf ormed in this state unless 11
licensed under this chapter. A person may not act as or represe nt to be a managing 12
general agent, reinsurance intermediary broker, third-party administrator, 13
pharmacy benefits manager, or reinsurance intermediary manager representing an 14
insurer domiciled in this state regarding a risk located outside this state unless licensed 15
by this state. 16
* Sec. 17. AS 21.27.010(c) is amended to read: 17
(c) A third-party administrator is not required to be licensed as a managing 18
general agent if the third-party administrator 19
(1) is licensed [REGISTERED] under this chapter [AS 21.27.630 - 20
21.27.660]; or 21
(2) only investigates and adjusts claims and is licensed under t h i s 22
chapter as an independent adjuster. 23
* Sec. 18. AS 21.27.010 is amended by adding a new subsection to read: 24
(l) In addition to the requirements under AS 21.27.010 - 21.27.460, a 25
(1) third-party administrator is subject to the licensing requ irements 26
under AS 21.27.630 - 21.27.660; and 27
(2) pharmacy benefits manager is subject to the licensing requ irements 28
under AS 21.27.901 - 21.27.975. 29
* Sec. 19. AS 21.27.020(c) is amended to read: 30
(c) To qualify for issuance or renewal of a license as a firm insurance 31

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producer, a firm managing general agent, a firm reinsurance int ermediary broker, a 1
firm reinsurance intermediary manager, a firm surplus lines bro ker, or a firm 2
independent adjuster, an applicant or licensee shall 3
(1) comply with (b)(4) and (5) of this section; 4
(2) maintain a lawfully established place of business in this state, 5
except when licensed as a nonresident under AS 21.27.270; 6
(3) designate one or more compliance officers for the firm, ex cept that 7
not more than one compliance officer may be designated for each line [ CL A S S ] o f 8
authority under AS 21.27.115; 9
(4) provide to the director documents necessary to verify the 10
information contained in or made in connection with the application; and 11
(5) notify the director, in writing, not later than 30 days af ter a change 12
in the firm's compliance officer. 13
* Sec. 20. AS 21.27.020(f) is amended to read: 14
(f) The director may adopt regul ations establishing additional education or 15
experience requirements for applicants, licensees, and continui ng education providers 16
under this chapter upon due consid eration of the availability a nd accessibility of 17
education and training opportun ities in rural areas of the stat e. Regulations adopted 18
under this subsection are subject to the following provisions: 19
(1) additional educational or experience requirements may not apply to 20
a licensee who has been licensed by the division of insurance before January 1, 1980; 21
(2) a licensee shall complete at least 24 credit hours of appr oved 22
continuing education courses during each two-year license period; 23
(3) if a licensee has accumulated more credit hours than required under 24
(2) of this subsection by the end of the license period, a maxi mum of eight hours may 25
be carried over to meet the requirements of (2) of this subsect ion in the next license 26
period; 27
( 4 ) a p r o g r a m o r s e m i n a r m a y n o t b e a p p r o v e d a s a n a c c e p t a b l e 28
continuing education program unl ess it is a formal program of l earning that 29
contributes to the professional competence of the licensee; ind ividual study programs 30
or correspondence courses may be used to fulfill continuing edu cation requirements if 31

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approved by the director; 1
(5) a nonresident licensee is exempt from the requirements of this 2
subsection, except for a nonresident independent adjuster who designates this 3
state as the adjuster's home state. 4
* Sec. 21. AS 21.27.025(a) is amended to read: 5
(a) A licensee shall notify the director in writing not later than 30 days after a 6
change in residence, place of business, legal name, fictitious name or alias, mailing 7
address, electronic mailing addr ess, telephone number, or compl iance officer. A 8
licensee shall report to the director in writing any administra tive action taken against 9
the licensee by a governmental agency [OF ANOTHER STATE, BY A 10
GOVERNMENTAL AGENCY OF ANOTHER JURISDICTION,] or by a financial 11
industry regulatory authority san ction or arbitration proceedin g not later than 30 days 12
after the final disposition of the action. A licensee shall submit to the director the final 13
order and other relevant legal documents in the action. A licen see shall report to the 14
director in writing any criminal prosecution of the licensee in this or another st ate or 15
jurisdiction not later than 30 days after the date of filing of the criminal complaint, 16
indictment, information, or citation in the prosecution. The licensee shall submit to the 17
director a copy of the criminal complaint, calendaring order, a nd other relevant legal 18
documents in the prosecution. 19
* Sec. 22. AS 21.27.060(d) is amended to read: 20
(d) This section does not apply to an applicant 21
(1) for a limited license under AS 21.27.150(a)(1), (4), (5), or (8); 22
[OR] 23
(2) who, at any time within the one-year period immediately pr eceding 24
the date the current pending app lication is received by the div ision, had been licensed 25
in good standing in this state under a license requiring substa ntially similar 26
qualifications as required by the license applied for; or 27
(3) who is a compliance officer for a third-party administrato r or 28
pharmacy benefits manager. 29
* Sec. 23. AS 21.27.115 is amended to read: 30
Sec. 21.27.115. Lines of authority. If a person has met the applicable 31

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requirements of AS 21.27.020 and 21.27.270, the director shall issue a license for one 1
or more of the following lines of authority: 2
(1) life insurance coverage on natural persons; in this paragr aph, "life 3
insurance coverage" 4
(A) includes benefits of endowment and annuities; and 5
( B ) m a y i n c l u d e b e n e f i t s i n t h e e v e n t o f d e a t h o r 6
dismemberment by accident and benefits for disability income; 7
(2) accidental and health or sickness insurance coverage for sickness, 8
bodily injury, or accidental d eath; in this paragraph, " accidental and health or 9
sickness insurance coverage" includes health insurance, as defined in 10
AS 21.12.050(a), and may include benefits for disability income; 11
(3) property insurance coverage for the direct or consequentia l loss for 12
damage to property of every kind; 13
(4) casualty insurance coverage against legal liability, inclu ding that 14
for death, injury, or disability or damage to real or personal property; in this 15
paragraph, "casualty insurance" includes surety insurance as defined in AS 21.12.080; 16
(5) variable life and variable annuity products insurance coverage; 17
(6) personal lines property and casualty insurance coverage so ld to 18
individuals and families for primarily noncommercial purposes; 19
(7) limited lines credit insurance; 20
(8) [REPEALED 21
(9) REPEALED 22
(10)] any insurance for which a limited lines license may be i ssued 23
under AS 21.27.150. 24
* Sec. 24. AS 21.27.270(b) is amended to read: 25
(b) Unless the director denies or refuses to renew a license u nder 26
AS 21.27.410, the director shall issue a nonresident producer, limited lines, surplus 27
lines broker, managing general agent, reinsurance intermediary broker, independent 28
adjuster, or reinsurance intermediary manager license to a person who is not a 29
resident of this state if 30
(1) the person is currently licensed and is in good standing i n the 31

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person's home state; the director may verify the person's licen sing status through the 1
producer licensing database records maintained by the National Association of 2
Insurance Commissioners or its affiliates or subsidiaries; 3
(2) the person has paid the fees required under AS 21.06.250 a nd has 4
submitted to the director 5
(A) the license application the person submitted to the person 's 6
home state; or 7
(B) if the person is not a firm, a completed uniform application 8
or, if a firm, the uniform business entity application; and 9
(3) the person's home state awards nonresident producer, limit ed lines, 10
surplus lines broker, managing general agent, reinsurance intermediary broker, 11
independent adjuster, and reinsurance intermediary manager licenses to residents of 12
this state on the same basis as does this state. 13
* Sec. 25. AS 21.27.270(h) is amended to read: 14
(h) A nonresident applicant fo r an independent adjuster licens e who [ONLY 15
ADJUSTS CLAIMS RELATED TO PORTABLE ELECTRONICS INSURANCE 16
UNDER AS 21.36.515 AND WHO] is licensed as an independent adjus ter and in 17
good standing in the applicant's home state does not have to me et the requirements of 18
AS 21.27.060 or 21.27.830 to be licensed under this section. [A RESIDENT OF 19
CANADA MAY NOT BE LICENSED AS AN INDEPENDENT ADJUSTER 20
UNDER THIS SECTION UNLESS THE APPLICANT HAS OBTAINED A 21
RESIDENT INDEPENDENT ADJUSTER LICENSE IN ANOTHER STATE OR 22
DECLARED ANOTHER STATE THE APPLICANT'S HOME STATE AND 23
OBTAINED AN INDEPENDENT ADJUSTER LICENSE IN THAT STATE.] 24
* Sec. 26. AS 21.27.270(i) is amended to read: 25
(i) If a nonresident independent [PORTABLE ELECTRONICS] adjust er 26
applicant's home state does not license independent adjusters, the independent 27
[PORTABLE ELECTRONICS] adjuster applicant may designate the app licant's home 28
state as any state in which the applicant is licensed in good standing. 29
* Sec. 27. AS 21.27.270 is amended by adding a new subsection to read: 30
(j) A nonresident applicant fo r issuance or renewal of an inde pendent adjuster 31

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license or firm independent adjuster license who designates this state as the applicant's 1
home state must qualify for licensure under AS 21.27.020 and ap ply for the issuance 2
or renewal of the license in accordance with AS 21.27.040. 3
* Sec. 28. AS 21.27.380(b) is amended to read: 4
(b) If a license is not renewed on or before the renewal date set by the director, 5
the license expires. A licensee may not act as or represent to be an insurance producer, 6
managing general agent, reinsurance intermediary broker, third-party administrator, 7
pharmacy benefits manager, reinsurance intermediary manager, surplus lines broker, 8
or independent adjuster during the time a license has expired. The director may 9
reinstate an expired license if the person continues to qualify for the license and pays 10
renewal license fees and a delayed renewal penalty. Reinstateme nt does not exempt a 11
person from a penalty provided by law for transacting business while unlicensed. A 12
license may not be renewed if it has expired for two years or longer. 13
* Sec. 29. AS 21.27.380(d) is amended to read: 14
(d) The director shall send [MAIL] a notice of license expiration stating the 15
reason for the expiration to a licensee at the licensee's most current electronic mail 16
address or mailing [LAST] address on record with the director. [THE DIRECTOR 17
SHALL OBTAIN A CERTIFICATE OF MAILING FROM THE UNITED STATES 18
POSTAL SERVICE.] 19
* Sec. 30. AS 21.27.630(a) is amended to read: 20
(a) A person may not act as or represent to be a third-party a dministrator in 21
this state or relative to a subject resident, located, or to be performed in this state, 22
unless licensed [REGISTERED] under this chapter or in another jurisdiction unde r 23
AS 21.27.650. A person may not act as or represent to be a thir d-party administrator 24
representing an insurer domiciled in this state regarding a risk located outside this state 25
unless licensed [REGISTERED] by this state under the provisions of this chapter. 26
* Sec. 31. AS 21.27.630(b) is amended to read: 27
(b) A third-party administrator may not transact business for a kind or class of 28
authority for which the person is not licensed [REGISTERED]. 29
* Sec. 32. AS 21.27.630(c) is amended to read: 30
( c ) E x c e p t a s o t h e r w i s e p r o v i d e d i n t h i s c h a p t e r , a t h i r d - p a r ty administrator 31

Enrolled SB 132 -16-
shall be licensed [REGISTERED] under this chapter [AS 21.27.630 - 21.27.660] 1
unless the third-party administrator only investigates and adjusts claims and is licensed 2
under this chapter as an independent adjuster. 3
* Sec. 33. AS 21.27.630(d) is amended to read: 4
(d) A third-party administrator may not use a fictitious name or alias unless 5
the third-party administrator's [LICENSEE'S] legal name and fictitious name or 6
alias are on the license [REGISTRATION]. 7
* Sec. 34. AS 21.27.630(e) is amended to read: 8
(e) A person who is an employee of an admitted insurer, who ac ts within the 9
course and scope of that employme nt, and within the scope of th e insurer's certificate 10
of authority is not required to be licensed [REGISTERED] under this chapter 11
[SECTION]. 12
* Sec. 35. AS 21.27.630(g) is amended to read: 13
(g) A credit union or a financial institution subject to super vision or 14
examination by federal or state banking authorities, or a mortg age lender, that 15
performs no functions other than advancing premiums to the insu rer and collecting a 16
debt from the insured is not required to be licensed [REGISTERED] as a third-party 17
administrator. 18
* Sec. 36. AS 21.27.630(h) is amended to read: 19
(h) A credit card issuing company that performs no functions, including 20
adjustment or settlement of claims, other than advancing and co llecting premiums 21
from its credit card holders who ha ve authorized collection is not required to be 22
licensed [REGISTERED] as a third-party administrator. 23
* Sec. 37. AS 21.27.630(i) is amended to read: 24
(i) A person who only provides services to bona fide employee benefit plans 25
that are established by an employer or an employee organization , or both, for which 26
the insurance laws of this state are preempted under the Employ ee Retirement Income 27
Security Act of 1974, is not required to be additionally licensed [REGISTERED] as a 28
third-party administrator if the person certifies to the direct or on or before February 1 29
of each year its exempt status. 30
* Sec. 38. AS 21.27.630(j) is amended to read: 31

-17- Enrolled SB 132
(j) A third-party administrator 1
[(1) SHALL APPLY FOR REGISTRATION UNDER THE 2
PROCEDURES OF AS 21.27.040; 3
(2) SHALL RENEW ITS REGISTRATION UNDER THE 4
PROCEDURES OF AS 21.27.380; AND 5
(3)] is subject to hearings and orders on violations; denial, nonrenewal, 6
suspension, or revocation of license [REGISTRATION]; penalties; and surrender of 7
license [REGISTRATION] under the procedures set out in AS 21.27.405 - 21.27.460. 8
* Sec. 39. AS 21.27.630(k) is amended to read: 9
(k) An insurer that holds a cer tificate of authority issued by the director and is 10
in good standing under this title is not required to be licensed [REGISTERED] as a 11
third-party administrator in this state. 12
* Sec. 40. AS 21.27.630(l) is amended to read: 13
(l) A person that is not required to be licensed [REGISTERED] as a third-14
party administrator under (e) - (k) of this section must file an annual [A] certification 15
with the director that the person meets the requirements for ex emption on or before 16
February 1 of each year. 17
* Sec. 41. AS 21.27.630(m) is amended to read: 18
(m) A person who is an employee of a third-party administrator and who acts 19
within the course and scope of that employment and within the s cope of the written 20
contract required under AS 21.27.650(a)(4) is not required to b e licensed 21
[REGISTERED] as a third-party administrator under this section unless that person 22
is the designated complia nce officer under AS 21.27.640(b)(6) . The third-party 23
administrator is responsible for the acts of its employees regulated under this title. 24
* Sec. 42. AS 21.27.640(a) is amended to read: 25
(a) The director may not issue or renew a license [REGISTRATION] except 26
in compliance with this chapter and may not issue a license [REGISTRATION] to a 27
person, or to be exercised by a person, found by the director t o be untrustworthy, 28
incompetent, financially irresponsible, or who has not established to the satisfaction of 29
the director that the person is qualified under this chapter. 30
* Sec. 43. AS 21.27.640(b) is amended to read: 31

Enrolled SB 132 -18-
(b) To qualify for issuance or renewal of a license [REGISTRATION], an 1
applicant or licensee [REGISTRANT] shall comply with this title, regulations adopted 2
under AS 21.06.090, and 3
(1) be a trustworthy person; 4
(2) have active working experience in administrative functions that, in 5
the director's opinion, exhibits the ability to competently per form the administrative 6
functions of a third-party administrator; 7
(3) not have committed an act that is a cause for denial, nonr enewal, 8
suspension, or revocation of a registration or license in this state or another 9
jurisdiction; 10
(4) maintain a lawfully est ablished place of business [AS 11
DESCRIBED IN AS 21.27.330] in this state, unless licensed as a nonresident under 12
AS 21.27.270; 13
(5) disclose to the director all owners, officers, directors, or partners, if 14
any; 15
(6) designate a compliance officer for the firm; 16
(7) provide in or with its application 17
(A) all basic organizational documents of the third-party 18
administrator, including article s of incorporation, articles of association, 19
partnership agreement, trade name certificate, trust agreement, shareholder 20
agreement, and other applicable documents and all endorsements to the 21
required documents; 22
(B) the bylaws, rules, regulations, or similar documents 23
regulating the internal affairs of the administrator; 24
(C) the names, mailing addresses, physical addresses, official 25
positions, and professional qualif ications of persons who are r esponsible for 26
the conduct of affairs of the third-party administrator, includ ing the members 27
of the board of directors, board of trustees, executive committ ee, or other 28
governing board or committee; the principal officers in the cas e of a 29
corporation, or the partners or m embers in the case of a partne rship, limited 30
liability company, limited liability partnership, or associatio n; shareholders 31

-19- Enrolled SB 132
holding directly or indirectly 10 percent or more of the voting securities of the 1
third-party administrator; and an y other person who exercises c ontrol or 2
influence over the affairs of the third-party administrator; 3
(D) certified financial statements for the preceding two years , 4
or for each year and partial year that the applicant has been i n business if less 5
than two years, prepared by an independent certified public acc ountant 6
establishing that the applicant is solvent, that the applicant' s system of 7
accounting, internal control, and procedure is operating effect ively to provide 8
reasonable assurance that money is promptly accounted for and p aid to the 9
person entitled to the money, and any other information that th e director may 10
require to review the current financial condition of the applicant; and 11
(E) a statement describing the business plan, including 12
information on staffing levels and activities proposed in this state and in other 13
jurisdictions and providing details establishing the third-part y administrator's 14
capability for providing a sufficient number of experienced and qualified 15
personnel in the areas of claims handling, underwriting, and record keeping; 16
(8) provide to the director documents necessary to verify the 17
statements contained in or in connection with the application; and 18
(9) notify the director, in writing, not later than 30 days after 19
(A) a change in compliance officer, residence, place of 20
business, mailing address, or phone number; 21
(B) the final disposition of an administrative action taken 22
against the licensee [REGISTRANT] by a governmental agency [OF 23
ANOTHER STATE, BY A GOVERNMENTAL AGENCY OF ANOTHER 24
JURISDICTION,] or by a financial industry regulatory authority sanction or 25
arbitration proceeding; in addition, a licensee [REGISTRANT] shall submit to 26
the director documents relating to the final disposition on, in cluding the final 27
order and other relevant legal documents in, the action; or 28
(C) a conviction of a misdemeanor or felony of the third-party 29
administrator, its officers, directors, partners, owners, or employees. 30
* Sec. 44. AS 21.27.640(d) is amended to read: 31

Enrolled SB 132 -20-
(d) If the director finds that the applicant or licensee [REGISTRANT] is 1
qualified and that application, license [REGISTRATION], or renewal fees have been 2
paid, the director may issue or renew the license [REGISTRATION]. 3
* Sec. 45. AS 21.27.640 is amended by adding a new subsection to read: 4
(e) The fee for an initial license is $2,000. The fee to renew a l i c e n s e i s 5
$2,000, and the license must be renewed every two years. 6
* Sec. 46. AS 21.27.650(a) is amended to read: 7
(a) An insurer may not transact business with a third-party ad ministrator 8
unless 9
(1) the insurer holds a certificate of authority in this state if required 10
under this title; 11
(2) the third-party administrator is licensed [REGISTERED] under 12
t h i s c h a p t e r [ O R T H E T H I R D - P A R T Y A D M I N I S T R A T O R H A S F I L E D A 13
CERTIFICATION WITH THE DIRECTOR CERTIFYING THAT THE THIRD-14
PARTY ADMINISTRATOR IS OPERATING ONLY FOR A FOREIGN INSURER 15
OTHER THAN A SELF-FUNDED MULTIPLE EMPLOYER WELFARE 16
ARRANGEMENT REGULATED UNDER AS 21.85 AND IS REGISTERED AS A 17
THIRD-PARTY ADMINISTRATOR BY THE THIRD-PARTY 18
ADMINISTRATOR'S RESIDENT INSURANCE REGULATOR IN A STATE 19
THAT THE DIRECTOR HAS DETERMINED HAS ENACTED PROVISIONS 20
SUBSTANTIALLY SIMILAR TO THOSE CONTAINED IN AS 21.27.630 - 21
21.27.650 AND THAT IS ACCREDITED BY THE NATIONAL ASSOCIATION OF 22
INSURANCE COMMISSIONERS]; 23
(3) the third-party administrat or provides the director on Jan uary 1, 24
April 1, July 1, and October 1 of each year 25
(A) a list of persons who supervise or have responsibility ove r 26
personnel performing administrative functions, including claims administration 27
and payment, marketing adminis trative functions, premium accoun ting, 28
premium billing, coverage verif ication, underwriting, or certif icate issuance 29
upon a subject resident, located, or to be performed in this state; 30
(B) a list of current insurers under contract; and 31

-21- Enrolled SB 132
(C) other information the director may require; 1
(4) a written contract is in effect between the parties that e stablishes 2
the responsibilities of each party, indicates both parties' sha re of responsibility for a 3
particular function, and specifies the division of responsibilities; 4
(5) there is in effect a written contract between the insurer and third-5
party administrator that contains the following provisions: 6
(A) the insurer may terminate the contract for cause upon 7
written notice sent by certified mail to the third-party admini strator and may 8
suspend the underwriting authorit y of the third-party administr ator during a 9
dispute regarding the cause for t ermination; but the insurer mu st fulfill all 10
lawful obligations with respect to policies affected by the wri tten agreement, 11
regardless of any dispute between the insurer and the third-party administrator; 12
(B) the third-party administr ator shall render accounts to the 13
insurer detailing all transactions and remit all money due unde r the contract to 14
the insurer at least monthly; 15
(C) all money collected for the account of an insurer shall be 16
held by the third-party administrator as a fiduciary; 17
(D) all payments on behalf of the insurer shall be held by the 18
third-party administrator as a fiduciary; 19
(E) the third-party administrator may not retain more than thr ee 20
months' estimated claims payments and allocated loss adjustment expenses; 21
(F) the third-party administrator shall maintain separate reco rds 22
for each insurer in a form usable by the insurer; the insurer o r its authorized 23
representative shall have the rig ht to audit and the right to c opy all accounts 24
and records related to the insur er's business; the director, in addition to other 25
authority granted in this title, shall have access to all books, bank accounts, and 26
records of the third-party administrator in a form usable to th e director; any 27
trade secrets contained in books and records reviewed by the di rector, 28
including the identity and addr esses of policyholders and certi ficate holders, 29
shall be kept confidential, except that the director may use th e information in a 30
proceeding instituted against the third-party administrator or the insurer; 31

Enrolled SB 132 -22-
(G) the contract may not be assigned in whole or in part by th e 1
third-party administrator; 2
(H) if the contract permits the third-party administrator to d o 3
underwriting, the contract must include the following: 4
(i) the third-party administrator's maximum annual 5
premium volume; 6
(ii) the rating system and basis of the rates to be 7
charged; 8
(iii) the types of risks that may be written; 9
(iv) maximum limits of liability; 10
(v) applicable exclusions; 11
(vi) territorial limitations; 12
(vii) policy cancellation provisions; 13
(viii) the maximum policy term; and 14
(ix) that the insurer shall have the right to cancel or not 15
renew a policy of insurance subject to applicable state law; 16
(I) if the contract permits the third-party administrator to 17
administer claims on behalf of the insurer, the contract must i nclude the 18
following: 19
(i) written settlement authority must be provided by the 20
insurer and may be terminated for cause upon the insurer's writ ten 21
notice sent by certified mail to the third-party administrator or upon the 22
termination of the contract, but the insurer may suspend the se ttlement 23
authority during a dispute regarding the cause of termination; 24
(ii) claims shall be reported to the insurer within 30 25
days; 26
(iii) a copy of the claim file shall be sent to the insurer 27
upon request or as soon as it beco mes known that the claim has the 28
potential to exceed an amount determined by the director or exceeds the 29
limit set by the insurer, whicheve r is less, involves a coverag e dispute, 30
may exceed the third-party administrator's claims settlement au thority, 31

-23- Enrolled SB 132
is open for more than six mont hs, involves extra contractual 1
allegations, or is closed by payment in excess of an amount set by the 2
director or an amount set by the insurer, whichever is less; 3
(iv) each party to the contract shall comply with unfair 4
claims settlement statutes and regulations; 5
(v) transmission of electronic data must occur at least 6
monthly if electronic claim files are in existence; and 7
(vi) claim files shall be the s ole property of the insurer; 8
upon an order of liquidation of the insurer, the third-party ad ministrator 9
shall have reasonable access to and the right to copy the files on a 10
timely basis; and 11
(J) the contract may not provide for commissions, fees, or 12
charges contingent upon savings obtained in the adjustment, set tlement, and 13
payment of losses covered by the insurer's obligations; but a t hird-party 14
administrator may receive performance-based compensation for pr oviding 15
hospital or other auditing services or may receive compensation b a s e d o n 16
premiums or charges collected or the number of claims paid or processed. 17
* Sec. 47. AS 21.27.650(q) is amended to read: 18
(q) The director may, without advance notice or hearing, immediately suspend 19
by order the license [REGISTRATION] of a third-party administrator if the director 20
finds that one or more of the following circumstances exist: 21
(1) the third-party administrator is insolvent or impaired; 22
(2) a proceeding for bankruptcy, receivership, conservatorship , or 23
rehabilitation, or another delinque ncy proceeding regarding the third-party 24
administrator has been commenced in any state or by a governmen tal agency of 25
another jurisdiction; 26
(3) the third-party administrator is in an unsound condition, or is in a 27
condition or using methods or pr actices that render its further transaction of insurance 28
injurious to policy holders or the public. 29
* Sec. 48. AS 21.27.901 is amended to read: 30
Sec. 21.27.901. Licensure [R EGISTRATION] of pharmacy benefits 31

Enrolled SB 132 -24-
managers; scope of business practice. (a) A person may not conduct business in the 1
state as a pharmacy benefits manager unless the person is licensed [REGISTERED] 2
with the director. 3
(b) A pharmacy benefits manager licensed [REGISTERED] under this section 4
may 5
(1) contract with an insurer to administer or manage pharmacy benefits 6
provided by an insurer for a c overed person, including claims p rocessing services for 7
and audits of payments for prescription drugs and medical devices and supplies; and 8
(2) contract with network pharmacies. 9
(c) A pharmacy benefits manager 10
(1) shall apply for licensure [ R E G I S T R A T I O N ] f o l l o w i n g t h e s a m e 11
procedures for licensure set out in AS 21.27.040; 12
(2) is subject to hearings and orders on violations; denial, n onrenewal, 13
suspension, or revocation of license [REGISTRATION]; penalties; and surrender of 14
license [REGISTRATION] under the procedures set out in AS 21.27.405 - 21.27.460. 15
(d) Each day that a pharmacy benefits manager conducts busines s in the state 16
as a pharmacy benefits manager without being licensed [REGISTERED] is a separate 17
violation of this section, and e ach separate violation is subje ct to the maximum civil 18
penalty under AS 21.97.020. 19
* Sec. 49. AS 21.27 is amended by adding new sections to read: 20
Sec. 21.27.903. Pharmacy benefits manager qualifications. (a) An 21
application for a pharmacy benefits manager license must be in a form prescribed by 22
the director. 23
(b) The director may only issue or renew a license if the director is satisfied 24
that the applicant is a trustworthy person. The director may no t issue a license to an 25
applicant who has committed an act that is a cause for denial, nonrenewal, suspension, 26
or revocation of a registration or license in this state or another jurisdiction. 27
(c) An application must disclose 28
(1) information concerning the identity, professional history, 29
professional experience, and background history of all owners, officers, directors, or 30
partners; 31

-25- Enrolled SB 132
(2) any administrative action ta ken against the owners, office rs, 1
directors, or partners by a gove rnmental agency of this or anot her jurisdiction and any 2
sanction imposed by a financial industry regulatory authority o r arbitration 3
proceeding; 4
(3) any criminal prosecution in this state or another state or jurisdiction 5
of an owner, officer, director, or partner; the application mus t include the criminal 6
complaint, calendaring order, and other relevant legal documents. 7
(d) An application must designate a compliance officer for the p h a r m a c y 8
benefits manager and include the name, business address, teleph one number, 9
electronic mailing address, professional experience, and inform ation concerning the 10
background history of the officer. 11
(e) An application must include 12
(1) the required application fee; 13
(2) the organizational document s of the pharmacy benefits mana ger, 14
including articles of incorporation, articles of association, partnership agreement, trade 15
name certificate, trust agreement, shareholder agreement, and o ther applicable 16
documents, as well as the endorsements to the required documents; 17
(3) the name and address of the pharmacy benefits manager's ag ent for 18
service of process in the state; 19
(4) the bylaws, rules, regulations, or similar documents regul ating the 20
internal affairs of the pharmacy benefits manager; 21
(5) the name, electronic mailing address, physical address, of ficial 22
position, and professi onal qualifications of each person who is responsible for the 23
conduct of affairs of the pharmac y benefits manager, including the board of directors, 24
board of trustees, executive committee, or other governing boar d or committee; the 25
principal officers in the case of a corporation, or the partners or members in the case of 26
a partnership, limited liability company, limited liability par tnership, or association; 27
shareholders holding directly or indirectly 10 percent or more of the voting securities 28
of the pharmacy benefits manager; and any other person who exer cises control or 29
influence over the affairs of the pharmacy benefits manager; 30
(6) certified financial statements for the preceding two years , or for 31

Enrolled SB 132 -26-
each year and partial year that the applicant has been in business if less than two years, 1
prepared by an independent certified public accountant establis hing that the applicant 2
is solvent, that the applicant's system of accounting, internal control, and procedure is 3
operating effectively to provide reasonable assurance that mone y is promptly 4
accounted for and paid to the person entitled to the money, and any other information 5
that the director may require to review the current financial condition of the applicant. 6
Sec. 21.27.904. Pharmacy benefits ma nager required notification s. (a) A 7
licensed pharmacy benefits manager shall notify the director in writing not later than 8
30 days after 9
(1) a change in the information contained within the licensee's license, 10
place of business, electronic mailing address, physical mailing address, or telephone 11
number; 12
(2) a change in compliance officer, residence, place of busine ss, 13
mailing address, or telephone number; 14
(3) the final disposition of an administrative action taken ag ainst the 15
licensee by a governmental agenc y of another state, by a govern mental agency of 16
another jurisdiction, or by a fi nancial industry regulatory aut hority sanction or 17
arbitration proceeding; in add ition, a licensee shall submit to the director documents 18
relating to the final disposition on, including the final order and other relevant legal 19
documents in, the action; or 20
(4) a conviction of a misdemeanor or felony of the pharmacy be nefits 21
manager, its officers, designated compliance officer, directors, partners, or owners. 22
(b) Failure to provide the inf ormation required under this sec tion within 30 23
days is cause for denial, revocation, or suspension of license. 24
* Sec. 50. AS 21.27.905(a) is amended to read: 25
(a) A pharmacy benefits manager shall biennially renew a license 26
[REGISTRATION] with the director following the procedures for l icense renewal in 27
AS 21.27.380. The fee for an initi al license is $20,000, and the fee to renew a 28
license is $20,000. 29
* Sec. 51. AS 21.27.975(15) is amended to read: 30
(15) "pharmacy benefits manager" means a person that contracts with a 31

-27- Enrolled SB 132
pharmacy on behalf of an insurer to process claims or pay pharm acies for prescription 1
drugs or medical devices and supplies or provide network management for pharmacies 2
regardless of ownership of the pharmacy benefits manager; 3
* Sec. 52. AS 21.27.990(8) is amended to read: 4
(8) "compliance officer" means a licensee designated for a specific line 5
[AND CLASS] of authority under AS 21.27.115 [ T H I S C H A P T E R ] w h o i s 6
responsible for a firm's complia nce with the insurance statutes and regulations of this 7
state; 8
* Sec. 53. AS 21.27.990(12) is amended to read: 9
(12) "home state," with respect to 10
(A) an insurance producer, means the District of Columbia or a 11
state or territory of the United States in which an insurance p roducer maintains 12
the producer's principal place of residence or principal place of business and is 13
licensed to act as an insurance producer; 14
(B) an independent [PORTABLE ELECTRONICS] adjuster, 15
means the District of Columbia or a state or territory of the U nited States in 16
which an independent [PORTABLE ELE CTRONICS] adjuster maintains the 17
independent [PORTABLE ELECTRONICS ] adjuster's principal place o f 18
residence or principal place of business and is licensed to act as an independent 19
adjuster or, if the state or territory of the United States of the independent 20
[PORTABLE ELECTRONICS] adjuster's principal place of residence or 21
principal place of business doe s not license independent adjust ers, the state or 22
territory of the United States d esignated by the independent [P ORTABLE 23
ELECTRONICS] adjuster where the independent [PORTABLE 24
ELECTRONICS] adjuster is licensed; 25
* Sec. 54. AS 21.27.990(13) is amended to read: 26
(13) "independent [PORTABLE ELECTRONICS] adjuster" means a 27
person [AN INDEPENDENT ADJUSTER] who investigates, negotiates, or settles 28
property, casualty, or workers' compensation claims for insurer s or self-insurers 29
[COLLECTS, FURNISHES, OR ENTERS CLAIM INFORMATION FOR 30
PORTABLE ELECTRONICS INSURANCE ISSUED UNDER AS 21.36.515]; 31

Enrolled SB 132 -28-
* Sec. 55. AS 21.27.990(20) is amended to read: 1
(20) "limited lines" means those lines of insurance defined in 2
AS 21.27.150 [OR ANY OTHER LINE OF INSURANCE THAT THE DIRECTOR 3
DESIGNATES BY ORDER AS A LIMITED LINE]; 4
* Sec. 56. AS 21.33.055(d) is amended to read: 5
(d) On default of a nonadmitted insurer in the payment of the tax, the insured 6
shall pay the tax within 30 days after written notice from the director of the default by 7
the nonadmitted insurer. For wet marine and transportation insurance, a surplus 8
lines broker may pay the tax on behalf of the nonadmitted insurer or the insured. 9
If the tax prescribed by this section is not paid [BY THE NONAD MITTED 10
INSURER] within the time stated [OR BY THE INSURED WITHIN THE T IME 11
STATED] after notice of default from the director [BY THE NONADMITTED 12
INSURER], the tax may be increased by 13
(1) a late payment fee of $1,000 or 10 percent of the tax due, 14
whichever is greater; 15
(2) interest at the rate of one percent a month or part of a m onth from 16
the date the payment was originally due to the date paid; and 17
(3) a penalty not to exceed $100 a day or 25 percent of the ta x due, 18
whichever is greater, from the date the payment was due to the date paid. 19
* Sec. 57. AS 21.34.035 is amended to read: 20
Sec. 21.34.035. Health care insuran ce and disability insurance. (a) Except 21
for a multiple employer welfare arrangement, health care insura nce and disability 22
insurance may be placed in and written by a nonadmitted insurer if 23
(1) the director finds it is in the best interest of the publi c and issues an 24
order to that effect; and 25
(2) the insurance is in compliance with this chapter. 26
(b) The rates and rating methods for health care insurance and disability 27
insurance placed and written under this section are subject to AS 21.51. 405 and 28
AS 21.54.015. The surplus lines broker shall make the filings r equired under 29
AS 21.51.405 and AS 21.54.015 and maintain the records and acco unts as required 30
under AS 21.87.230. 31

-29- Enrolled SB 132
(c) Health care insurance and disability insurance may not be procured under 1
this chapter 2
(1) for the purpose of obtaining a lower premium rate than acc eptable 3
by an authorized insurer; or 4
(2) for obtaining a competitive advantage. 5
(d) Health care insurance and disability insurance [INSURANCE] placed 6
in or written by a nonadmitted in surer and the activities of th e surplus lines broker 7
relating to that transaction are subject to this title. 8
(e) In this section, 9
(1) "disability insurance" means disability insurance as defin ed in 10
AS 21.12.052 that is excess insurance or for individuals unable to obtain disability 11
insurance with any admitted insurer; 12
(2) "health care insurance" has the meaning given in AS 21.12.050(b). 13
* Sec. 58. AS 21.34.040(d) is amended to read: 14
(d) An insurer, including a nonadmitted insurer, not domiciled in a state 15
or territory of the United States and not listed on the Quarter ly Listing of Alien 16
Insurers maintained by the National Association of Insurance Co mmissioners 17
International Insurers Department [A NONADMITTED INSURER] may be 18
eligible to provide coverage in this state if it files with the director or the director's 19
designee a copy of its current a nnual financial statement that has been certified by the 20
insurer. The financial stateme nt must be filed with and approve d by the regulatory 21
authority in the domicile of the [NONADMITTED] insurer [,] or c ertified by an 22
accounting or auditing firm licensed in the jurisdiction of the insurer's domicile. The 23
[A FOREIGN] insurer shall file [PROVIDE] the approved or certified financial 24
statement with the director or director's designee not more than nine [SIX] months 25
after the close of the reporting period. [AN ALIEN INSURER SHAL L PROVIDE 26
THE APPROVED OR CERTIFIED FINANCIAL STATEMENT NOT MORE THAN 27
N I N E M O N T H S A F T E R T H E C L O S E O F T H E R E P O R T I N G P E R I O D . I N T H E 28
CASE OF AN INSURANCE EXCHANGE, THE STATEMENT MAY BE AN 29
AGGREGATE COMBINED STATEMENT OF ALL UNDERWRITING 30
SYNDICATES OPERATING DURING THE PERIOD REPORTED UPON.] 31

Enrolled SB 132 -30-
* Sec. 59. AS 21.34.170(a) is amended to read: 1
(a) A surplus lines broker shall file with the director, on fo rms prescribed by 2
the director, a report of all surplus lines insurance, by type of insurance as required to 3
be reported in the annual statement that must be filed with the director by admitted 4
insurers. The report must include all surplus lines insurance t ransactions during the 5
preceding period showing the aggregate gross premiums written, the aggregate return 6
premiums, and the amount of aggregate tax remitted to this state [, AND THE 7
AMOUNT OF AGGREGATE TAX REMITTED TO EACH OTHER STATE FOR 8
WHICH AN ALLOCATION IS MADE UNDER AS 21.34.180]. The surplus lines 9
broker [ F O R M S ] s h a l l file the report [BE FILED] quarterly on March 1, June 1, 10
September 1, and December 1 of each year. 11
* Sec. 60. AS 21.34.190 is amended to read: 12
Sec. 21.34.190. Filing fee. (a) The fee for filing the statement under 13
AS 21.34.180(e) is an amount equal to one percent on gross premium charged less any 14
return premiums as reported on the statement. The surplus lines broker shall pay the 15
fee at the time of filing [OF] the statement and in a form and manner required by 16
the director. 17
(b) If the surplus lines broker does not pay the filing fee [IS NOT PAID] 18
when due, the surplus lines broker shall pay an additional late payment fee of $50 a 19
month [$250] plus two percent of the fee due per month, or part of a month, during 20
which the surplus lines broker fails to pay the full amount of the filing fee. The 21
late payment fee may not exceed $250 plus 10 percent of the fil ing fee due. If the 22
surplus lines broker does not pay the filing fee in the form or manner required by 23
the director, a penalty fee will be assessed equal to 25 percent of the filing fee due, 24
not to exceed $1,000, with a minimum penalty of $50. In additio n t o a n y o t h e r 25
penalty provided by law, the director may assess a penalty of n ot more than 26
$10,000 for a violation of this section. The director may suspe nd or revoke the 27
license of a surplus lines broker that fails to pay a fee under this section [SHALL 28
BECOME DUE AND PAYABLE BY THE SURPLUS LINES BROKER]. 29
* Sec. 61. AS 21.34.900(8) is amended to read: 30
(8) "home state," for purposes of determining the home state o f an 31

-31- Enrolled SB 132
insured in a multistate or multinational placement of nonadmitted insurance, is 1
defined as follows: 2
(A) except as provided in (B) or (C) of this paragraph, "home 3
state" means, with respect to an insured, 4
(i) the state in which an ins ured maintains its principal 5
place of business or, in the case of an individual, the individ ual's 6
principal residence; or 7
(ii) if 100 percent of the insured risk is located out of 8
the state referred to in (i) of this subparagraph, the state to which the 9
greatest percentage of the insured's taxable premium for that i nsurance 10
contract is allocated; 11
(B) if two or more insureds from an affiliated group are named 12
insureds on a single policy, "home state" under (A) of this par agraph is based 13
on the member of the affiliated group that has the largest perc entage of 14
premium attributed to it under the insurance contract; 15
(C) if two or more insureds are named insureds on a 16
nonaffiliated group policy, "home state" under (A) of this paragraph 17
(i) is based on the group policyholder if the group 18
policyholder pays 100 percent of the premium; or 19
(ii) is based on the named insured of the group 20
policy if the group policyholder does not pay 100 percent of th e 21
premium from the policyholder's own funds; 22
(D) for purposes of (A) of this paragraph, the principal place of 23
business of an insured is 24
(i) the state where the insured maintains its headquarters 25
and where the insured's high-level officers direct , control , and 26
coordinate the business activities of the insured; or 27
(ii) if an insured's high-level officers direct, control, 28
and coordinate the business activities of the insured in more t han 29
one state or if the insured maintains its headquarters in a 30
jurisdiction outside the United States, the state where the gre atest 31

Enrolled SB 132 -32-
percentage of the insured's taxable premium for the insurance 1
contract is allocated; 2
( E ) f o r p u r p o s e s o f ( A ) o f t h i s p a r a g r a p h , t h e p r i n c i p a l 3
residence of an insured is 4
(i) the state where the insured resides for the 5
greatest number of days in a calendar year; or 6
(ii) if the insured resides for the greatest number of 7
days in a calendar year in a jurisdiction outside the United St ates, 8
the state where the greatest percentage of the insured's taxabl e 9
premium for the insurance contract is allocated; 10
* Sec. 62. AS 21.34.900(15) is amended to read: 11
(15) "wet marine and transportation insurance" has the meaning given 12
in AS 21.12.090(b) [MEANS ONE OR MORE OF THE FOLLOWING: 13
(A) INSURANCE UPON, OF INTEREST IN, OR RELATING 14
TO VESSELS, CRAFTS, HULLS, EXCEPT VESSELS OF 50 15
DISPLACEMENT TONS OR LESS; 16
(B) INSURANCE OF MARINE BUILDERS RISKS, 17
MARINE WAR RISKS, AND CONTRACTS OF MARINE PROTECTION 18
AND INDEMNITY INSURANCE; 19
(C) INSURANCE OF FREIGHT AND DISBURSEMENTS 20
PERTAINING TO A SUBJECT OF INSURANCE COMING WITHIN THIS 21
PARAGRAPH; OR 22
(D) INSURANCE OF PERSONAL PROPERTY AND 23
INTERESTS IN PERSONAL PR OPERTY, IN COURSE OF 24
EXPORTATION FROM OR IMPORTATION INTO A COUNTRY OR IN 25
THE COURSE OF COASTAL OR INLAND WATER TRANSPORTATION, 26
INCLUDING TRANSPORTATION BY LAND, WATER, OR AIR FROM 27
POINT OF ORIGIN TO FINAL DESTINATION IN CONNECTION WITH 28
ANY AND ALL RISKS OR PERILS OF NAVIGATION, TRANSIT, OR 29
TRANSPORTATION, AND WHILE BEING REPAIRED FOR AND WHILE 30
AWAITING SHIPMENT, AND DURING ANY DELAYS, 31

-33- Enrolled SB 132
TRANSSHIPMENT, OR RESHIPMENT INCIDENT TO THEM]. 1
* Sec. 63. AS 21.36.125(a) is amended to read: 2
(a) A person may not commit any of the following acts or practices: 3
(1) misrepresent facts or po licy provisions relating to covera ge of an 4
insurance policy; 5
(2) fail to acknowledge and ac t promptly upon communications 6
regarding a claim arising under an insurance policy; 7
(3) fail to adopt and implement r easonable standards for promp t 8
investigation of claims; 9
(4) refuse to pay a claim without a reasonable investigation o f all of 10
the available information and an explanation of the basis for d enial of the claim or for 11
an offer of compromise settlement; 12
(5) fail to affirm or deny coverage of claims within a reasona ble time 13
of the completion of proof-of-loss statements; 14
(6) fail to attempt in good faith to make prompt and equitable 15
settlement of claims in which liability is reasonably clear; 16
(7) engage in a pattern or practice of compelling insureds to litigate for 17
recovery of amounts due under insurance policies by offering su bstantially less than 18
the amounts ultimately recovered in actions brought by those insureds; 19
(8) compel an insured or third-party claimant in a case in whi ch 20
liability is clear to litigate for recovery of an amount due un der an insurance policy by 21
offering an amount that does not h ave an objectively reasonable basis in law and fact 22
and that has not been documented in the insurer's file; 23
(9) attempt to make an unreasonably low settlement by referenc e to 24
printed advertising matter accompanying or included in an application; 25
(10) attempt to settle a claim on the basis of an application that has 26
been altered without the consent of the insured; 27
(11) make a claims payment wit hout including a statement of th e 28
coverage under which the payment is made; 29
(12) make known to an insured or third-party claimant a policy o f 30
appealing from an arbitration award in favor of an insured or t hird-party claimant for 31

Enrolled SB 132 -34-
the purpose of compelling the insured or third-party claimant t o accept a settlement or 1
compromise less than the amount awarded in arbitration; 2
(13) delay investigation or pay ment of claims by requiring sub mission 3
of unnecessary or substantially repetitive claims reports and proof-of-loss forms; 4
(14) fail to promptly settle c laims under one portion of a pol icy for the 5
purpose of influencing settlements under other portions of the policy; 6
(15) fail to promptly provide a r easonable explanation of the basis in 7
the insurance policy in relation to the facts or applicable law for denial of a claim or 8
for the offer of a compromise settlement; [OR] 9
(16) offer a form of settlement or pay a judgment in any manne r 10
prohibited by AS 21.96.030; 11
(17) violate a provision contained in AS 21.07; or 12
(18) offer a valuation that depreciates the expense of labor i n 13
violation of AS 21.60.030. 14
* Sec. 64. AS 21.36.225(a) is amended to read: 15
(a) An [EXCEPT FOR A HEALTH CARE INSURANCE POLICY 16
SUBJECT TO AS 21.51.400 OR AS 21.54.130, AN] insurer may not ca ncel a health 17
insurance policy unless the insurer provides written notice to a policyholder at least 45 18
days before the effective date of the cancellation. 19
* Sec. 65. AS 21.36.235(a) is amended to read: 20
(a) Except as provided in A S 21.36.305, if the renewal premium is increased 21
more than 10 percent for a reason other than an increase in cov erage or exposure base, 22
or if after renewal there will be a material restriction or red uction in coverage not 23
specifically requested by the insured, written notice shall be mailed to the insured and 24
to the agent or broker of record as required by AS 21.36.260 25
[(1) AT LEAST 20 DAYS BEFORE EXPIRATION OF A 26
PERSONAL INSURANCE POLICY; OR 27
(2)] at least 45 days before expiration of the [A BUSINESS OR 28
COMMERCIAL] policy. 29
* Sec. 66. AS 21.36.240(a) is amended to read: 30
(a) An insurer may only fail to renew a personal insurance pol icy on the 31

-35- Enrolled SB 132
policy's annual anniversary. An insurer may not fail to renew a policy unless a written 1
notice of nonrenewal is mailed to the named insured under AS 21 .36.260 at least [20 2
DAYS FOR A PERSONAL INSURANCE POLICY, AND AT LEAST] 45 days 3
[FOR A BUSINESS OR COMMERCIAL INSURANCE POLICY,] before the dat e 4
the policy expires or the anniversary date of a policy written for a term longer than one 5
year or with no fixed expiration date. 6
* Sec. 67. AS 21.36.240 is amended by adding a new subsection to read: 7
(e) For purposes of this section, an offer of placement with a n affiliate insurer 8
does not constitute a failure by an insurer to renew coverage. 9
* Sec. 68. AS 21.36 is amended by adding a new section to read: 10
Sec. 21.36.245. Cancellation of and failure to renew property a nd casualty 11
insurance. An insurer may not cancel or fail to renew a property insurance policy, or a 12
casualty insurance policy insuring a business or commercial pro perty, as a result of a 13
claim to an insurer made solely to meet a local, state, or fede ral aid requirement where 14
the insurer does not apply coverage and does not pay a benefit. 15
* Sec. 69. AS 21.36.475(a) is amended to read: 16
(a) An owner controlled insurance program or a contractor cont rolled 17
insurance program is subject to both AS 21.39 and AS 21.42, mus t be approved by the 18
director, and shall be allowed only for a major construction pr oject or a major multi-19
owner residential construction project . Owner controlled and contractor controlled 20
insurance programs are limited to property insurance as defined in AS 21.12.060 and 21
casualty insurance as defined in AS 21.12.070. 22
* Sec. 70. AS 21.36.475(b) is amended to read: 23
(b) In this section, an owner controlled or contractor control led insurance 24
[INSURED] program does not include 25
(1) builder's risk or course of construction insurance; 26
(2) insurance relating to the t ransportation of cargo or other property; 27
or 28
(3) insurance covering one or more affiliates, subsidiaries, p artners, or 29
joint venture partners of a person [; OR 30
(4) INSURANCE POLICIES ENDORSED TO NAME ONE OR 31

Enrolled SB 132 -36-
MORE PERSONS AS ADDITIONAL INSUREDS]. 1
* Sec. 71. AS 21.36.475(c) is amended by adding a new paragraph to read: 2
(7) "major multi-owner residential construction project" means a 3
construction project for condomin iums, townhouses, cooperative housing 4
developments, or other residential housing involving at least 4 0 units and three or 5
more property owners with a total cost of $20,000,000 or more. 6
* Sec. 72. AS 21.36.505(a) is amended to read: 7
(a) A person may not sell, market, promote, advertise, or otherwise distribute a 8
health discount plan unless 9
(1) each advertisement, policy, document, information, stateme nt, or 10
other communication regarding th e health discount plan and the plan itself contain a 11
statement, in bold and prominent type, that the health discount plan is not insurance; 12
(2) [THE DISCOUNTS OFFERED UNDER THE HEALTH 13
DISCOUNT PLAN ARE SPECIFICALLY AUTHORIZED BY A CONTRACT 14
WITH EACH PROVIDER OF THE SERVICES OR SUPPLIES LISTED IN 15
CONJUNCTION WITH THE PLAN; 16
(3)] the health discount plan st ates the name, address, and te lephone 17
number of the administrator of the plan; 18
(3) [(4)] the person makes readil y available to the consumer a 19
complete, accurate, and up-to-date list of providers participat ing in the plan that offer 20
discounted health care services or supplies in the consumer's l ocal area and the 21
discounts offered by the providers; 22
(4) [(5)] the person provides the c onsumer the right to cancel the 23
health discount plan within 30 days after purchase of the plan; 24
(5) [AND (6)] the person provides the consumer with a full refund o f 25
all payments made, except for a nominal processing fee, within 30 days after 26
notification of cancellation of the plan under (4) [(5)] of this subsection; 27
(6) the person registers the health discount plan in accordanc e 28
with regulations adopted by the director; and 29
(7) the person renews the health discount plan when required 30
under regulations adopted by the director. 31

-37- Enrolled SB 132
* Sec. 73. AS 21.36.520(a) is amended to read: 1
(a) An insurer providing a health care insurance policy or its pharmacy 2
benefits manager may not 3
(1) interfere with a covered person's right to choose a pharma cy or 4
provider; 5
( 2 ) i n t e r f e r e w i t h a c o v e r e d p e r s o n ' s r i g h t o f a c c e s s t o a c l inician-6
administered drug; 7
(3) interfere with the right of a pharmacy or pharmacist to pa rticipate 8
as a network pharmacy; 9
(4) reimburse a pharmacy or pharmacist an amount less than the 10
amount the pharmacy benefits man ager reimburses an affiliate fo r providing the same 11
pharmacy services, calculated on a per-unit basis using the sam e generic product 12
identifier or generic code number; 13
(5) impose a reduction in reim bursement for pharmacy services 14
because of the person's choice among pharmacies that have agreed to participate in the 15
plan according to the terms offered by the insurer or its pharmacy benefits manager; 16
(6) use a covered person's pharmacy services data collected un der the 17
provision of claims processing ser vices for the purpose of soli citing, marketing, or 18
referring the person to an affiliate of the pharmacy benefits manager; 19
(7) prohibit or limit a pharmacy from mailing, shipping, or de livering 20
drugs to a patient as an ancillary service; however, the insurer or its pharmacy benefits 21
manager 22
( A ) i s n o t r e q u i r e d t o r e i m b u r s e a d e l i v e r y f e e c h a r g e d b y a 23
pharmacy unless the fee is specified in the contract between th e pharmacy 24
benefits manager and the pharmacy; 25
(B) may not require a patient signature as proof of delivery o f a 26
mailed or shipped drug if the pharmacy 27
(i) maintains a mailing or shipping log signed by a 28
representative of the pharmacy or keeps a record of each notifi cation of 29
delivery provided by the United St a t e s m a i l o r a p a c k a g e d e l i v ery 30
service; and 31

Enrolled SB 132 -38-
(ii) is responsible for the c ost of mailing, shipping, or 1
delivering a replacement for a drug that was ma iled or shipped but not 2
received by the covered person; 3
(8) prohibit or limit a networ k pharmacy from informing an ins ured 4
person of the difference between the out-of-pocket cost to the covered person to 5
purchase a drug, medical device, or supply using the covered pe rson's pharmacy 6
benefits and the pharmacy's usual and customary charge for the drug, medical device, 7
or supply; 8
(9) conduct or participate in spread pricing in the state; 9
(10) assess, charge, or collect a form of remuneration that pa sses from 10
a pharmacy or a pharmacist in a pharmacy network to the pharmac y benefits manager, 11
including claim processing fees, performance-based fees, networ k participation fees, 12
or accreditation fees; 13
(11) reverse and resubmit the cl aim of a pharmacy more than 90 days 14
after the date the claim was first adjudicated, and may not rev erse and resubmit the 15
claim of a pharmacy unless the insurer or pharmacy benefits manager 16
(A) provides prior written notification to the pharmacy; 17
(B) has just cause; 18
(C) first attempts to reconcile the claim with the pharmacy; and 19
(D) provides to the pharmacy, at the time of the reversal and 20
resubmittal, a written description that includes details of and justification for 21
the reversal and resubmittal; 22
(12) prohibit or limit a pharmacy from collecting a fee from a 23
covered person for a service or product not covered by the cove red person's 24
health care insurance policy. 25
* Sec. 74. AS 21.36 is amended by adding a new section to article 5 to read: 26
Sec. 21.36.525. Decisions based on elected official status. (a) A person 27
transacting insurance in this state may not, solely because of a person's status as an 28
elected official, 29
(1) refuse to issue or renew insurance coverage; 30
(2) limit the scope of insurance coverage; 31

-39- Enrolled SB 132
(3) cancel an existing policy of insurance; 1
(4) deny a covered claim; or 2
(5) increase the premium, policy fees, or rates charged on an insurance 3
policy. 4
(b) The provisions of (a) of this section do not apply if the refusal, limitation, 5
cancellation, denial, or increase is 6
(1) based on sound underwriting or actuarial principles reason ably 7
related to actual or anticipated loss experience; or 8
(2) required or authorized by law or regulation. 9
(c) In this section, "elected official" means a member of the legislature, the 10
governor, the lieutenant governor, a member of the state's cong ressional delegation, a 11
constitutional convention delegate, a borough or city mayor, a member of a borough or 12
city assembly, council, or school board, or a member of a regio nal school board for a 13
regional educational attendance area. 14
* Sec. 75. AS 21.36.910(d) is amended to read: 15
(d) In addition to an order issued under (c) of this section, the director may, 16
after a hearing, order restitution, assess a penalty of not mor e than $2,500 for each 17
violation or $25,000 for engaging in a general business practic e in violation of this 18
chapter. The director may include int erest calculated under AS 09.30.070 in an 19
order for restitution entered under this subsection. 20
* Sec. 76. AS 21.39.155(c) is amended to read: 21
(c) An insurer may impose a surcharge not to exceed 25 percent o f t h e 22
premium for assigned risk pool insurance, except that a surchar ge may not be applied 23
to the first $6,000 [$3,000] in premium in any policy year. 24
* Sec. 77. AS 21.42.250(a) is amended to read: 25
(a) An insurer shall provide a policy or endorsement to the in sured or to the 26
person entitled to it by mail or electronic mail [DELIVERY] or by posting on the 27
insurer's Internet website under (c) of this section within a r easonable period of time 28
after its issuance. The insurer is not required to mail, delive r, or post the policy or 29
endorsement until all conditions required by the insurer have been met by the insured. 30
* Sec. 78. AS 21.42.375(e) is amended to read: 31

Enrolled SB 132 -40-
(e) Except as necessary to qualify a plan as a high deductible health plan 1
eligible for a health savings a ccount tax deduction under 26 U. S.C. 223 (Internal 2
Revenue Code), a health care insurer that offers, issues, deliv ers, or renews a health 3
care insurance plan in the indivi dual or group market in the st ate that provides 4
coverage for mammography screening, diagnostic breast examinati ons, and 5
supplemental breast examinations m ay not impose cost sharing, a deductible, 6
coinsurance, a copayment obligation, or another similar out-of- pocket expense on an 7
insured for coverage of a low-dose mammography screening, diagn ostic breast 8
examination, [OR] supplemental breast examination, biopsy, or consultation. 9
* Sec. 79. AS 21.42.375(f) is amended by adding new paragraphs to read: 10
(4) "biopsy" means a medical pro cedure involving the removal o f 11
tissue to determine the presence of cancer cells; 12
(5) "consultation" means a medical consultation with a health care 13
provider to discuss the results of a diagnostic breast examinat ion and whether further 14
biopsies or other diagnostic procedures are needed. 15
* Sec. 80. AS 21.42.377(a) is amended to read: 16
(a) Except for a fraternal benefit society, a health care insu rer that offers, 17
issues for delivery, delivers, or renews in this state a health care insurance plan shall 18
provide coverage for the costs of colorectal cancer screening e xaminations and 19
laboratory tests under the schedule described in (b) of this section. [THE COVERAGE 20
REQUIRED BY THIS SECTION IS SUBJECT TO STANDARD POLICY 21
PROVISIONS APPLICABLE TO OTHER BENEFITS, INCLUDING 22
DEDUCTIBLE OR COPAYMENT PROVISIONS.] 23
* Sec. 81. AS 21.42.377(b) is amended to read: 24
(b) The minimum coverage requi red under (a) of this section fo r colorectal 25
cancer screening includes coverage for colorectal cancer examin ations and laboratory 26
tests as recommended by the most recent [SPECIFIED IN] American Cancer 27
Society guidelines for colorectal cancer screening of [ASYMPTOM ATIC] individuals 28
considered at average risk for colorectal cancer . Coverage shall be provided for all 29
colorectal screening examinations and tests, including a colonoscopy performed as a 30
result of a positive result on a non-colonoscopy preventive scr eening test, that are 31

-41- Enrolled SB 132
administered at a frequency identified in the most recent American Cancer Society 1
guidelines for colorectal cancer. 2
* Sec. 82. AS 21.42.377(e) is amended to read: 3
(e) For individuals considered at 4
(1) average risk for colorectal cancer, coverage or benefits shall be 5
provided for the choice of screening, so long as it is conducte d in accordance with the 6
specified frequency ; coverage required by this par agraph is not subject to cost 7
sharing, including deductible, coinsurance, or copayment provisions; 8
(2) [. FOR INDIVIDUALS CONSIDERED AT] high risk for 9
colorectal cancer, screening shall be provided at a frequency d etermined necessary by 10
a health care provider. 11
* Sec. 83. AS 21.45.305(c)(2) is amended to read: 12
(2) The interest rate used in determining minimum nonforfeitur e 13
amounts shall be an annual rate of interest determined as the l esser of three percent a 14
year or the following, which shall be specified in the contract if the interest rate will be 15
reset: (A) the five-year constant maturity treasury rate report ed by the federal reserve 16
as of a date, or average over a period, rounded to the nearest 1/ 20 of one percent, 17
specified in the contract not mor e than 15 months before the co ntract issue date or 18
redetermination date under (D) of this paragraph; (B) reduced b y 125 basis points; (C) 19
where the resulting interest rate is not less than 0.15 [ONE] percent; and (D) the 20
interest rate must apply for an initial period and may be redet ermined for additional 21
periods; the redetermination da te, basis, and period, if any, m ust be stated in the 22
contract; the basis is the date or average over a specified per iod that produces the 23
value of the five-year constant maturity treasury rate to be us ed at each 24
redetermination date. 25
* Sec. 84. AS 21.48.010(f) is amended to read: 26
(f) An insurer shall submit to the director information demonstrating 27
[SATISFACTORY TO THE DIRECTOR] that the group meets the require ments of 28
(a) or (e) of this section. If the director finds the information to be satisfactory, the 29
director shall [, AND THE DIRECTOR MUST AFFIRMATIVELY] approve [OF] 30
the [GROUP BEFORE AN] insurer to [MAY] issue a group life policy to a group 31

Enrolled SB 132 -42-
under (a) or (e) of this section. The director's approval is not required for a single 1
employer group, labor union group, or multiple employer welfare arrangement 2
authorized under AS 21.85. 3
* Sec. 85. AS 21.51.060(b) is amended to read: 4
( b ) A p o l i c y i n w h i c h t h e i n s u r e r r e s e r v e s t h e r i g h t t o r e f u s e renewal shall 5
have, at the beginning of the provision in (a) of this section, 6
"Unless not less than 45 [30] days before the premium due date the insurer has 7
delivered to the insured or has m ailed to the las t address of t he insured as shown by 8
the records of the insurer written notice of its intention not to renew this policy beyond 9
the period for which the premium has been accepted." 10
* Sec. 86. AS 21.57.160(1) is amended to read: 11
(1) " agricultural [AGRICULTURE] credit transaction commitment" 12
means a binding agreement to lo an money up to a fixed amount as needed for 13
agricultural purposes; 14
* Sec. 87. AS 21.59 is amended by adding a new section to read: 15
Sec. 21.59.125. Motor vehicle service contract approval. (a) A provider may 16
not deliver or issue for delivery a motor vehicle service contr act unless the provider 17
files the contract with the division and receives approval from the director for the 18
contract. 19
(b) If a change is made to a motor vehicle service contract af ter it has been 20
approved, the provider shall file and receive approval for the changed contract in 21
accordance with (a) of this section. 22
* Sec. 88. AS 21.59.140(c) is amended to read: 23
(c) A licensee shall report to the director in writing any adm inistrative action 24
taken against the licensee by a governmental agency [OF ANOTHER STATE OR BY 25
A GOVERNMENTAL AGENCY OF ANOTHER JURISDICTION] within 30 days 26
after the final disposition of the action. A licensee shall submit to the director the final 27
order and other relevant legal documents in the action. A licen see shall report to the 28
director any criminal prosecution of the licensee within 30 day s after the date of filing 29
of the criminal complaint, indictment, or citation in the prose cution. The licensee shall 30
submit to the director a copy of the criminal complaint, calend aring order, and other 31

-43- Enrolled SB 132
relevant legal documents in the prosecution. 1
* Sec. 89. AS 21.60 is amended by adding a new section to read: 2
Sec. 21.60.030. Depreciation of labor. In a residential property policy, the 3
valuation of the expense of labor may not be depreciated, excep t where offered as a 4
stand-alone endorsement that speci fically identifies the intang ible items subject to 5
depreciation. An endorsement offered under this section must be an optional coverage 6
and provide a proportionate reduction in premium. 7
* Sec. 90. AS 21.76.070 is amended to read: 8
Sec. 21.76.070. Excess insurance. A cooperative agreement may authorize the 9
board of directors to purchase excess or catastrophic insurance on behalf of the joint 10
insurance arrangement. The cos t of the insurance shall be appor tioned in the manner 11
specified in the joint insurance agreement. The board may purch ase insurance under 12
this section only from an insurer authorized to do business in the state, except that an 13
arrangement formed by municipalities or school districts may pu rchase insurance 14
under this section from a risk-sharing pool established by a na tional association of 15
similar entities if the risk-shar ing pool meets the qualificati ons for a nonadmitted 16
[AN UNAUTHORIZED] insurer under AS 21.34.040(d) [AS 21.34.040(b) AND (d) 17
AND 21.34.220] and has capital and policyholders surplus in an amount at least as 18
great as would be required if the association were a domestic m ultiple line insurer. An 19
arrangement may purchase insurance under this section for prope rty and liability risks 20
from unauthorized insurers allowed for use by licensed Alaska surplus lines brokers. 21
* Sec. 91. AS 21.79.020(c) is amended to read: 22
(c) This chapter does not apply to 23
(1) that part of a policy or contract that is not guaranteed b y the 24
member insurer; 25
(2) that part of the risk borne by the policy or contract owner; 26
(3) a policy or contract of reinsurance, unless an assumption certificate 27
has been issued; 28
(4) that part of a policy or contract, except for part of a po licy or 29
contract, including a rider, that provides long-term care or ot her health insurance 30
benefits, to the extent that the rate of interest on which it i s based, or the interest rate, 31

Enrolled SB 132 -44-
crediting rate, or similar factor determined by use of an index or other external 1
reference stated in the policy or contract employed in calculat ing returns or changes in 2
value, 3
(A) averaged over the period of four years before the date on 4
which the member insurer becomes an impaired or insolvent insur er under this 5
chapter, whichever occurs first, exceeds the rate of interest d etermined by 6
subtracting two percentage points from the published monthly av erage for that 7
same four-year period or for a lesser period if the policy or contract was issued 8
less than four years before the member insurer becomes an impai red or 9
insolvent insurer under this chapter, whichever occurs first; and 10
(B) on and after the date on which the member insurer becomes 11
an impaired or insolvent insurer under this chapter, whichever occurs first, 12
exceeds the rate of interest determined by subtracting three pe rcentage points 13
from the most recent published monthly average; 14
(5) a portion of a policy or contract issued to a plan or prog ram of an 15
employer, association, or similar entity to provide life, healt h, or an annuity benefit to 16
an employee, member, or other person, to the extent that the pl an or program is self-17
funded or uninsured, including a benefit payable by the employe r, association, or 18
similar entity under 19
(A) a multiple employer welfare arrangement as defined in 29 20
U.S.C. 1002 (Employee Retirement Income Security Act of 1974); 21
(B) a minimum premium group insurance plan; 22
(C) a stop-loss group insurance plan; or 23
(D) an administrative services only contract; 24
(6) that part of a policy or contract that provides a dividend o r 25
experience rating credit or voting rights, or provides that a f ee or allowance be paid to 26
a person, including the policy or contract owner, in connection with the service to or 27
administration of the policy or contract; 28
(7) a policy or contract issued in this state by a member insurer at a 29
time when it was not licensed or did not have a certificate of authority to issue the 30
policy or contract in this state; 31

-45- Enrolled SB 132
(8) a person who is a payee or beneficiary of a contract owner who is a 1
resident of this state if the payee or beneficiary is provided coverage by the association 2
of another state; 3
(9) a person covered under (d) of this section if any coverage i s 4
provided by the association of another state to that person; 5
(10) an unallocated annuity contract issued to or in connectio n with a 6
benefit plan protected under the United States Pension Benefit Guaranty Corporation, 7
regardless of whether the United States Pension Benefit Guarant y Corporation has 8
become liable to make any payments with respect to the benefit plan; 9
(11) that part of an unallocated annuity contract that is not issued to or 10
in connection with a specific em ployee, union, or association o f natural persons 11
benefit plan or a government lottery; 12
(12) that part of a policy or contract to the extent that asse ssments 13
required by AS 21.79.070 with respect to the policy or contract are preempted by law; 14
(13) an obligation that does not arise under the express written terms of 15
the policy or contract issued by the member insurer to the enro llee, certificate holder, 16
contract owner, or policy owner, including, without limitation, 17
(A) a claim based on marketing materials; 18
(B) a claim based on a side lette r or other document that was 19
issued by the member insurer w ithout meeting applicable policy or contract 20
form filing or approval requirements; 21
(C) a misrepresentation of or regarding policy or contract 22
benefits; 23
(D) an extra contractual claim; or 24
(E) a claim for penalties or consequential or incidental 25
damages; 26
(14) a contractual agreement that establishes the member insur er's 27
obligations to provide a book value accounting guaranty for def ined contribution 28
benefit plan participants by reference to a portfolio of assets t h a t i s o w n e d b y t h e 29
benefit plan or its trustee, which, in each case, is not an aff iliate of the member 30
insurer; 31

Enrolled SB 132 -46-
(15) that part of a policy or contract to the extent the part of the policy 1
or contract provides for interest or other changes in value to be determined by the use 2
of an index or other external reference stated in the policy or contract, but that have 3
not been credited to the policy or contract, or as to which the policy or contract 4
owner's rights are subject to forfeiture, as of the date the me mber insurer becomes an 5
impaired or insolvent insurer unde r this chapter, whichever is earlier; if a policy's or 6
contract's interest or changes in value are credited less frequ ently than annually, then, 7
for purposes of determining the values that have been credited and are not subject to 8
forfeiture under this paragraph, the interest or change in value determined by using the 9
procedures defined in the policy or contract shall be credited as if the contractual date 10
of crediting interest or changing values was the date of impair ment or insolvency, 11
whichever is earlier, and will not be subject to forfeiture; 12
(16) a policy or contract providing a hospital, medical, presc ription 13
drug, or other health care benefit in accordance with 42 U.S.C. 1395w-21 - 42 U.S.C. 14
1395w-28, 42 U.S.C. 1395w-101 - 42 U.S.C. 1395w-154, 42 U.S.C. 1396 - 42 U.S.C. 15
1396w-8, [42 U.S.C. 1395w-21 - 1395w-154] or federal regulations adopte d under 16
those sections; 17
(17) a person who acquires rights to receive payments through a 18
structured settlement factoring transaction as defined in 26 U. S.C. 5891(c)(3)(A), 19
regardless of whether the transaction occurred before, on, or a fter 26 U.S.C. 20
5891(c)(3)(A) became effective; or 21
(18) structured settlement annuity benefits to which a payee o r 22
beneficiary has transferred the payee's or beneficiary's rights in a structured settlement 23
factoring transaction as defined in 26 U.S.C. 5891(c)(3)(A), re gardless of whether the 24
transaction occurred before, on, or after 26 U.S.C. 5891(c)(3)(A) became effective. 25
* Sec. 92. AS 21.86.040(a) is amended to read: 26
(a) The governing body of a health maintenance organization ma y include 27
providers, or other individuals, or both. At least one-quarter [ONE-THIRD] of the 28
governing body must consist of consumers who are substantially representative of 29
enrollees. 30
* Sec. 93. AS 21.86.060(b) is amended to read: 31

-47- Enrolled SB 132
(b) In addition to basic health care services, a health mainte nance organization 1
may provide, or arrange for, other health care services on a pr epayment, fixed fee, or 2
other financial basis. 3
* Sec. 94. AS 21.86.060 is amended by adding new subsections to read: 4
(d) A health maintenance organi zation shall provide coverage f or emergency 5
services, as that term is de fined in AS 21.07.250, that are nec essary to screen and 6
stabilize a covered person at the health maintenance organizati on provider employee 7
or contracted provider level of c ost sharing when the services are not provided by a 8
health maintenance organization provider. The health maintenanc e organization may 9
require the transfer of a hospitalized covered person upon stabilization. 10
(e) A health maintenance organization shall provide coverage a t the health 11
maintenance organization provider employee or contracted provid er level of cost 12
sharing upon referral from a hea lth maintenance organization pr ovider that states the 13
covered person requires medically necessary services from a pro vider that is not a 14
health maintenance organization provider. The health maintenanc e organization may 15
deny the referral when an in-network provider is available to p rovide the medically 16
necessary services. 17
* Sec. 95. AS 21.96.090 is amended by adding a new subsection to read: 18
(g) A risk retention group shall file a report in accordance w ith 19
AS 21.09.210(a) and pay the tax required for a domestic and for eign insurer under 20
AS 21.09.210(b). 21
* Sec. 96. AS 21.96.120 is amended to read: 22
Sec. 21.96.120. Waiver for state innovation. The director may apply to a 23
federal agency for a waiver of federal law that relates to a he alth insurance 24
requirement, including applying to the United States Secretary of Health and 25
Human Services under 42 U.S.C. 18052 , as amended, for a waiver of applicable 26
provisions of P.L. 111-148 (Patient Protection and Affordable Care Act), as amended, 27
with respect to health insurance [COVERAGE] in the state for a plan year beginning 28
on or after January 1, 2017. The di rector may implement a state plan meeting the 29
waiver requirements in a manner consistent with state and federal law and as approved 30
by the United States Secretary of Health and Human Services. 31

Enrolled SB 132 -48-
* Sec. 97. AS 21.97.900 is amended by adding a new paragraph to read: 1
(48) "motor vehicle" means a mo tor vehicle subject to registra tion 2
under AS 28.10.011. 3
* Sec. 98. AS 21.09.210(d); AS 21.27.020(g), 21.27.330(a), 21.27.630(f), 2 1.27.905(b); 4
AS 21.34.030(d); AS 21.39.020(b)(4); AS 21.42.377(c); AS 21.59. 290(2); and AS 21.86.078 5
are repealed. 6
* Sec. 99. The uncodified law of the State of Alaska is amended by adding a new section to 7
read: 8
APPLICABILITY. (a) AS 21.36.475(b), as amended by sec. 70 of th is Act, applies to 9
contracts entered into on or after the effective date of sec. 70 of this Act. 10
(b) AS 21.36.525, added by sec. 74 of this Act, applies to an insurance policy or 11
contract issued, delivered, or renewed on or after the effective date of sec. 74 of this Act. 12
* Sec. 100. Sections 69 - 71 of this Act take effect immediately under AS 01.10.070(c). 13
* Sec. 101. Except as provided in sec. 100 of this Act, this Act takes effect January 1, 2026. 14