S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2794
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             January 24, 2023
                                ___________
 
 Introduced  by  Sen. BRESLIN -- read twice and ordered printed, and when
   printed to be committed to the Committee on Insurance
 
 AN ACT to amend the insurance  law,  in  relation  to  establishing  the
   interstate  insurance  product  regulation compact to regulate certain
   insurance products

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. Legislative findings and intent.  An interstate compact is
 a contract between the states that allows them to  cooperate  on  multi-
 state or national issues while still retaining state control. Interstate
 compacts  are  specifically  mentioned in the U.S. Constitution and have
 been historically used to address border disputes and water rights.  The
 use  of interstate compacts has expanded significantly in recent decades
 to cover tax, motor vehicle licensing, environmental, emergency  manage-
 ment and other issues. Over 200 interstate compacts currently exist, and
 on  average  every state belongs to at least 25 compacts. The Interstate
 Insurance Product Regulation Compact, which to date has been adopted  by
 44  member  states, representing approximately two-thirds of the premium
 volume in the nation, created the  Interstate  Insurance  Product  Regu-
 lation  Commission (IIPRC). The IIPRC provides the States with a vehicle
 to (1) develop uniform national product standards  that  will  afford  a
 high  level  of  protection  to  consumers of life insurance, annuities,
 disability income and long-term care insurance products; (2) establish a
 central point of filing for these insurance products; and (3) thoroughly
 review product filings and make regulatory decisions  according  to  the
 uniform  product  standards.  The  IIPRC  is  an important modernization
 initiative that benefits state insurance regulators, consumers, and  the
 insurance  industry.  The Compact enhances the efficiency and effective-
 ness of the way insurance products are  filed,  reviewed,  and  approved
 allowing insurance customers to have faster access to competitive insur-
 ance  products  in  an  ever-changing  global  marketplace.  The Compact
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD06683-01-3
              

 S. 2794                             2
 
 promotes uniformity through application  of  uniform  product  standards
 embedded  with strong consumer protections.  The state of New York seeks
 to join with other states as a member of the Interstate Insurance  Prod-
 uct Regulation Compact and Commission.
   §  2.  The insurance law is amended by adding a new article 82 to read
 as follows:
 
                                ARTICLE 82
              INTERSTATE INSURANCE PRODUCT REGULATION COMPACT
 
 SECTION 8201. SHORT TITLE.
         8202. PURPOSE.
         8203. DEFINITIONS.
         8204. ESTABLISHMENT OF THE COMMISSION AND VENUE.
         8205. POWERS OF THE COMMISSION.
         8206. ORGANIZATION OF THE COMMISSION.
         8207. MEETINGS AND ACTS OF THE COMMISSION.
         8208. RULES AND OPERATING PROCEDURES; RULE MAKING  FUNCTIONS  OF
                 THE COMMISSION AND OPTING OUT OF UNIFORM STANDARDS.
         8209. COMMISSION RECORDS AND ENFORCEMENT.
         8210. DISPUTE RESOLUTION.
         8211. PRODUCT FILING AND APPROVAL.
         8212. REVIEW OF COMMISSION DECISIONS REGARDING FILINGS.
         8213. FINANCE.
         8214. COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT.
         8215. WITHDRAWAL, DEFAULT AND TERMINATION.
         8216. SEVERABILITY AND CONSTRUCTION.
         8217. BINDING EFFECT OF COMPACT AND OTHER LAWS.
         8218. EXEMPT PRODUCTS.
   §  8201.  SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
 THE "INTERSTATE INSURANCE PRODUCT REGULATION COMPACT".
   § 8202. PURPOSE. THE PURPOSES OF THIS COMPACT ARE,  THROUGH  MEANS  OF
 JOINT AND COOPERATIVE ACTION AMONG THE COMPACTING STATES:
   (A) TO PROMOTE AND PROTECT THE INTEREST OF CONSUMERS OF INDIVIDUAL AND
 GROUP  ANNUITY,  LIFE  INSURANCE,  DISABILITY  INCOME AND LONG-TERM CARE
 INSURANCE PRODUCTS;
   (B) TO DEVELOP  UNIFORM  STANDARDS  FOR  PRODUCTS  COVERED  UNDER  THE
 COMPACT;
   (C) TO ESTABLISH A CENTRAL CLEARINGHOUSE TO RECEIVE AND PROVIDE PROMPT
 REVIEW  OF  PRODUCTS  COVERED  UNDER  THE COMPACT AND, IN CERTAIN CASES,
 ADVERTISEMENTS RELATED THERETO, SUBMITTED BY INSURERS AUTHORIZED  TO  DO
 BUSINESS IN ONE OR MORE COMPACTING STATES;
   (D)  TO  GIVE APPROPRIATE REGULATORY APPROVAL TO THOSE PRODUCT FILINGS
 AND ADVERTISEMENTS SATISFYING THE APPLICABLE UNIFORM STANDARD;
   (E) TO IMPROVE COORDINATION  OF  REGULATORY  RESOURCES  AND  EXPERTISE
 BETWEEN  STATE  INSURANCE  DEPARTMENTS  REGARDING THE SETTING OF UNIFORM
 STANDARDS AND REVIEW OF INSURANCE PRODUCTS COVERED UNDER THE COMPACT;
   (F) TO CREATE THE INTERSTATE INSURANCE PRODUCT REGULATION  COMMISSION;
 AND
   (G)  TO PERFORM SUCH OTHER RELATED FUNCTIONS AS MAY BE CONSISTENT WITH
 THE STATE REGULATION OF THE BUSINESS OF INSURANCE.
   § 8203. DEFINITIONS. AS USED IN THIS ARTICLE:
   (A) "ADVERTISEMENT" MEANS  ANY  MATERIAL  DESIGNED  TO  CREATE  PUBLIC
 INTEREST IN A PRODUCT, OR INDUCE THE PUBLIC TO PURCHASE, INCREASE, MODI-
 FY, REINSTATE, BORROW ON, SURRENDER, REPLACE OR RETAIN A POLICY, AS MORE
 S. 2794                             3
 
 SPECIFICALLY  DEFINED  IN  THE  RULES  AND  OPERATING  PROCEDURES OF THE
 COMMISSION.
   (B) "BY-LAWS" MEAN THOSE BY-LAWS ESTABLISHED BY THE COMMISSION FOR ITS
 GOVERNANCE  OR  FOR DIRECTING OR CONTROLLING THE COMMISSION'S ACTIONS OR
 CONDUCT.
   (C) "COMPACTING STATE" MEANS ANY STATE WHICH HAS ENACTED THIS  COMPACT
 LEGISLATION  AND  WHICH HAS NOT WITHDRAWN OR BEEN TERMINATED PURSUANT TO
 SECTION EIGHT THOUSAND TWO HUNDRED FIFTEEN OF THIS ARTICLE.
   (D) "COMMISSION" MEANS THE "INTERSTATE  INSURANCE  PRODUCT  REGULATION
 COMMISSION" ESTABLISHED BY THE COMPACT.
   (E)  "COMMISSIONER" MEANS THE CHIEF INSURANCE REGULATORY OFFICIAL OF A
 STATE INCLUDING, BUT NOT LIMITED TO COMMISSIONER, SUPERINTENDENT, DIREC-
 TOR OR ADMINISTRATOR.
   (F) "DOMICILIARY STATE" MEANS THE STATE IN WHICH AN INSURER IS  INCOR-
 PORATED  OR  ORGANIZED OR, IN THE CASE OF AN ALIEN INSURER, ITS STATE OF
 ENTRY.
   (G) "INSURER" MEANS ANY ENTITY LICENSED BY A STATE TO ISSUE  CONTRACTS
 OF INSURANCE FOR ANY OF THE LINES OF INSURANCE COVERED BY THIS ARTICLE.
   (H)  "MEMBER"  MEANS  THE  PERSON, OR HIS OR HER DESIGNEE, CHOSEN BY A
 COMPACTING STATE FOR SERVICE ON THE COMMISSION.
   (I) "NON-COMPACTING STATE" MEANS ANY STATE WHICH IS NOT AT THE TIME  A
 COMPACTING STATE.
   (J)  "OPERATING PROCEDURES" MEAN PROCEDURES PROMULGATED BY THE COMMIS-
 SION IMPLEMENTING A RULE,  UNIFORM  STANDARD  OR  A  PROVISION  OF  THIS
 COMPACT.
   (K)  "PRODUCT"  MEANS  THE  FORM  OF THE CONTRACT, POLICY APPLICATION,
 ENDORSEMENTS, CERTIFICATE FORMS, EVIDENCE OF COVERAGE FORMS AND  RELATED
 FORMS  FOR  AN  INDIVIDUAL  OR GROUP ANNUITY, LIFE INSURANCE, DISABILITY
 INCOME OR LONG-TERM CARE INSURANCE PRODUCT, WHICH AN INSURER IS  AUTHOR-
 IZED TO ISSUE.
   (L)  "RULE"  MEANS  A STATEMENT OF GENERAL OR PARTICULAR APPLICABILITY
 AND FUTURE EFFECT PROMULGATED BY THE  COMMISSION,  INCLUDING  A  UNIFORM
 STANDARD  DEVELOPED PURSUANT TO SECTION EIGHT THOUSAND TWO HUNDRED EIGHT
 OF THIS ARTICLE, DESIGNED TO IMPLEMENT, INTERPRET, OR PRESCRIBE  LAW  OR
 POLICY  OR  DESCRIBING THE ORGANIZATION, PROCEDURE, OR PRACTICE REQUIRE-
 MENTS OF THE COMMISSION, WHICH SHALL HAVE THE FORCE AND EFFECT OF LAW IN
 THE COMPACTING STATES.
   (M) "STATE" MEANS ANY STATE,  DISTRICT  OR  TERRITORY  OF  THE  UNITED
 STATES OF AMERICA.
   (N)  "THIRD-PARTY FILER" MEANS AN ENTITY THAT SUBMITS A PRODUCT FILING
 TO THE COMMISSION ON BEHALF OF AN INSURER.
   (O) "UNIFORM STANDARD" MEANS A STANDARD ADOPTED BY THE COMMISSION  FOR
 A  PRODUCT LINE, PURSUANT TO SECTION EIGHT THOUSAND TWO HUNDRED EIGHT OF
 THIS ARTICLE AND SHALL INCLUDE ALL OF THE PRODUCT REQUIREMENTS IN AGGRE-
 GATE; PROVIDED, THAT EACH UNIFORM STANDARD SHALL BE  CONSTRUED,  WHETHER
 EXPRESS  OR IMPLIED, TO PROHIBIT THE USE OF ANY INCONSISTENT, MISLEADING
 OR AMBIGUOUS PROVISIONS IN A PRODUCT AND THE FORM OF SUCH  PRODUCT  MADE
 AVAILABLE  TO  THE  PUBLIC  SHALL  NOT BE UNFAIR, INEQUITABLE OR AGAINST
 PUBLIC POLICY AS DETERMINED BY THE COMMISSION.
   § 8204. ESTABLISHMENT OF THE COMMISSION AND VENUE. (A) THE  COMPACTING
 STATES  HEREBY  ESTABLISH A JOINT PUBLIC AGENCY KNOWN AS THE "INTERSTATE
 INSURANCE PRODUCT REGULATION  COMMISSION".  PURSUANT  TO  SECTION  EIGHT
 THOUSAND  TWO  HUNDRED  EIGHT OF THIS ARTICLE, THE COMMISSION SHALL HAVE
 THE POWER TO DEVELOP UNIFORM STANDARDS FOR PRODUCT  LINES,  RECEIVE  AND
 PROVIDE  PROMPT REVIEW OF PRODUCTS FILED THEREWITH, AND GIVE APPROVAL TO
 THOSE PRODUCT FILINGS SATISFYING APPLICABLE UNIFORM STANDARDS; PROVIDED,
 S. 2794                             4
 
 HOWEVER, THAT IT IS NOT INTENDED FOR THE COMMISSION TO BE THE  EXCLUSIVE
 ENTITY  FOR  RECEIPT AND REVIEW OF INSURANCE PRODUCT FILINGS. NOTHING IN
 THIS SECTION SHALL PROHIBIT ANY INSURER FROM FILING ITS PRODUCT  IN  ANY
 STATE WHEREIN SUCH INSURER IS LICENSED TO CONDUCT THE BUSINESS OF INSUR-
 ANCE  AND  SUCH  FILING  SHALL BE SUBJECT TO THE LAWS OF THE STATE WHERE
 FILED.
   (B) THE COMMISSION IS A BODY CORPORATE AND POLITIC, AND AN  INSTRUMEN-
 TALITY OF THE COMPACTING STATES.
   (C)  THE  COMMISSION IS A NOT-FOR-PROFIT ENTITY, SEPARATE AND DISTINCT
 FROM THE INDIVIDUAL COMPACTING STATES.
   (D) THE COMMISSION IS SOLELY RESPONSIBLE FOR  ITS  LIABILITIES  UNLESS
 OTHERWISE  SPECIFICALLY  PROVIDED  IN  THIS  COMPACT, EXCEPT THAT, IN NO
 EVENT SHALL THE OBLIGATIONS OF THE COMMISSION BE THE DEBT OF  THE  STATE
 OF  NEW YORK NOR SHALL ANY REVENUES OR PROPERTY OF THE STATE OF NEW YORK
 BE LIABLE THEREFOR.
   (E) VENUE IN PROPER AND JUDICIAL PROCEEDINGS BY OR AGAINST THE COMMIS-
 SION SHALL BE BROUGHT SOLELY AND EXCLUSIVELY IN  A  COURT  OF  COMPETENT
 JURISDICTION WHERE THE PRINCIPAL OFFICE OF THE COMMISSION IS LOCATED.
   §  8205.  POWERS  OF THE COMMISSION. (A) THE COMMISSION SHALL HAVE THE
 FOLLOWING POWERS:
   (1) TO PROMULGATE  RULES,  PURSUANT  TO  SECTION  EIGHT  THOUSAND  TWO
 HUNDRED  EIGHT OF THIS ARTICLE, WHICH SHALL HAVE THE FORCE AND EFFECT OF
 LAW AND SHALL BE BINDING IN THE COMPACTING STATES TO THE EXTENT  AND  IN
 THE MANNER PROVIDED IN THIS ARTICLE;
   (2)  TO  EXERCISE  ITS  RULE MAKING AUTHORITY AND ESTABLISH REASONABLE
 UNIFORM STANDARDS FOR PRODUCTS COVERED UNDER THE COMPACT, AND ADVERTISE-
 MENT RELATED THERETO, WHICH SHALL HAVE THE FORCE AND EFFECT OF  LAW  AND
 SHALL  BE  BINDING  IN THE COMPACTING STATES, BUT ONLY FOR SUCH PRODUCTS
 FILED WITH THE COMMISSION; PROVIDED, HOWEVER, THAT  A  COMPACTING  STATE
 SHALL  HAVE  THE  RIGHT  TO OPT OUT OF SUCH UNIFORM STANDARD PURSUANT TO
 SECTION EIGHT THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE TO  THE  EXTENT
 AND  IN  THE  MANNER PROVIDED IN THIS ARTICLE, AND PROVIDED FURTHER THAT
 ANY UNIFORM STANDARD ESTABLISHED BY THE COMMISSIONER FOR LONG-TERM  CARE
 INSURANCE  PRODUCTS  MAY  PROVIDE  THE  SAME  OR GREATER PROTECTIONS FOR
 CONSUMERS AS, BUT SHALL NOT PROVIDE LESS  THAN,  THOSE  PROTECTIONS  SET
 FORTH  IN  THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS' (HEREIN-
 AFTER REFERRED TO AS THE "NAIC") LONG-TERM CARE INSURANCE MODEL ACT  AND
 LONG-TERM  CARE  INSURANCE MODEL REGULATION, RESPECTIVELY, ADOPTED AS OF
 2001. THE COMMISSION SHALL CONSIDER WHETHER ANY SUBSEQUENT AMENDMENTS TO
 THE NAIC LONG-TERM CARE INSURANCE MODEL ACT OR LONG-TERM CARE  INSURANCE
 MODEL  REGULATION  ADOPTED  BY  THE NAIC REQUIRE AMENDING OF THE UNIFORM
 STANDARDS  ESTABLISHED  BY  THE  COMMISSION  FOR   LONG-TERM   INSURANCE
 PRODUCTS;
   (3) TO RECEIVE AND REVIEW IN AN EXPEDITIOUS MANNER PRODUCTS FILED WITH
 THE  COMMISSION,  INCLUDING RATE FILINGS FOR DISABILITY INCOME AND LONG-
 TERM CARE INSURANCE PRODUCTS, AND GIVE APPROVAL OF  THOSE  PRODUCTS  AND
 RATE  FILINGS  THAT  SATISFY THE APPLICABLE UNIFORM STANDARD, WHERE SUCH
 APPROVAL SHALL HAVE THE FORCE AND EFFECT OF LAW AND BE  BINDING  ON  THE
 COMPACTING  STATES  TO  THE  EXTENT  AND  IN  THE MANNER PROVIDED IN THE
 COMPACT;
   (4) TO RECEIVE AND  REVIEW  IN  AN  EXPEDITIOUS  MANNER  ADVERTISEMENT
 RELATING  TO  LONG-TERM CARE INSURANCE PRODUCTS FOR WHICH UNIFORM STAND-
 ARDS HAVE BEEN ADOPTED BY THE COMMISSION,  AND  GIVE  APPROVAL  OF  SUCH
 ADVERTISEMENT  THAT  SATISFIES  THE APPLICABLE UNIFORM STANDARD. FOR ANY
 PRODUCT COVERED UNDER THIS ARTICLE, OTHER THAN LONG-TERM CARE  INSURANCE
 PRODUCTS,  THE COMMISSION SHALL HAVE THE AUTHORITY TO REQUIRE AN INSURER
 S. 2794                             5
 
 TO SUBMIT ALL OR ANY PART OF ITS  ADVERTISEMENT  WITH  RESPECT  TO  THAT
 PRODUCT FOR REVIEW OR APPROVAL PRIOR TO USE IF THE COMMISSION DETERMINES
 THAT  THE  NATURE  OF  THE  PRODUCT IS SUCH THAT AN ADVERTISEMENT OF THE
 PRODUCT  COULD  HAVE THE CAPACITY OR TENDENCY TO MISLEAD THE PUBLIC. THE
 ACTIONS OF THE COMMISSION AS PROVIDED IN THIS  SECTION  SHALL  HAVE  THE
 FORCE AND EFFECT OF LAW AND SHALL BE BINDING IN THE COMPACTING STATES TO
 THE EXTENT AND IN THE MANNER PROVIDED IN THE COMPACT;
   (5)  TO  EXERCISE  RULE  MAKING  AUTHORITY  AND DESIGNATE PRODUCTS AND
 ADVERTISEMENT THAT MAY BE SUBJECT TO A SELF-CERTIFICATION PROCESS  WITH-
 OUT THE NEED FOR PRIOR APPROVAL BY THE COMMISSION;
   (6)  TO  PROMULGATE  OPERATING  PROCEDURES,  PURSUANT TO SECTION EIGHT
 THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE, WHICH SHALL  BE  BINDING  IN
 THE  COMPACTING  STATES  TO THE EXTENT AND IN THE MANNER PROVIDED IN THE
 COMPACT;
   (7) TO BRING AND PROSECUTE LEGAL PROCEEDINGS OR ACTIONS IN ITS NAME AS
 THE COMMISSION; PROVIDED, THAT  THE  STANDING  OF  ANY  STATE  INSURANCE
 DEPARTMENT TO SUE OR BE SUED UNDER APPLICABLE LAW SHALL NOT BE AFFECTED;
   (8)  TO  ISSUE  SUBPOENAS  REQUIRING  THE  ATTENDANCE AND TESTIMONY OF
 WITNESSES AND THE PRODUCTION OF EVIDENCE;
   (9) TO ESTABLISH AND MAINTAIN OFFICES;
   (10) TO PURCHASE AND MAINTAIN INSURANCE AND BONDS;
   (11) TO BORROW, ACCEPT OR CONTRACT FOR SERVICES OF PERSONNEL,  INCLUD-
 ING, BUT NOT LIMITED TO, EMPLOYEES OF A COMPACTING STATE;
   (12) TO HIRE EMPLOYEES AND ELECT OR APPOINT OFFICERS, AND TO FIX THEIR
 COMPENSATION, DEFINE THEIR DUTIES AND GIVE THEM APPROPRIATE AUTHORITY TO
 CARRY  OUT  THE  PURPOSES OF THE COMPACT, AND DETERMINE THEIR QUALIFICA-
 TIONS; AND TO ESTABLISH THE COMMISSION'S PERSONNEL POLICIES AND PROGRAMS
 RELATING TO, AMONG OTHER THINGS, CONFLICTS OF INTEREST, RATES OF COMPEN-
 SATION AND QUALIFICATIONS OF PERSONNEL;
   (13) TO ACCEPT ANY AND ALL APPROPRIATE DONATIONS AND GRANTS OF  MONEY,
 EQUIPMENT, SUPPLIES, MATERIALS AND SERVICES, AND TO RECEIVE, UTILIZE AND
 DISPOSE  OF  THE  SAME;  PROVIDED THAT AT ALL TIMES THE COMMISSION SHALL
 STRIVE TO AVOID ANY APPEARANCE OF IMPROPRIETY;
   (14) TO LEASE, PURCHASE, ACCEPT APPROPRIATE GIFTS OR DONATIONS OF,  OR
 OTHERWISE  TO OWN, HOLD, IMPROVE OR USE, ANY PROPERTY, REAL, PERSONAL OR
 MIXED; PROVIDED THAT AT ALL TIMES THE COMMISSION SHALL STRIVE  TO  AVOID
 ANY APPEARANCE OF IMPROPRIETY;
   (15)  TO  SELL,  CONVEY, MORTGAGE, PLEDGE, LEASE, EXCHANGE, ABANDON OR
 OTHERWISE DISPOSE OF ANY PROPERTY, REAL, PERSONAL OR MIXED;
   (16) TO REMIT FILING FEES TO COMPACTING STATES AS MAY BE SET FORTH  IN
 THE BY-LAWS, RULES OR OPERATING PROCEDURES;
   (17)  TO  ENFORCE  COMPLIANCE BY COMPACTING STATES WITH RULES, UNIFORM
 STANDARDS, OPERATING PROCEDURES AND BY-LAWS;
   (18) TO PROVIDE FOR DISPUTE RESOLUTION AMONG COMPACTING STATES;
   (19) TO ADVISE COMPACTING STATES ON ISSUES RELATING TO INSURERS  DOMI-
 CILED OR DOING BUSINESS IN NON-COMPACTING JURISDICTIONS, CONSISTENT WITH
 THE PURPOSES OF THE COMPACT;
   (20) TO PROVIDE ADVICE AND TRAINING TO THOSE PERSONNEL IN STATE INSUR-
 ANCE  DEPARTMENTS  RESPONSIBLE  FOR PRODUCT REVIEW, AND TO BE A RESOURCE
 FOR STATE INSURANCE DEPARTMENTS;
   (21) TO ESTABLISH A BUDGET AND MAKE EXPENDITURES;
   (22) TO BORROW MONEY;
   (23) TO APPOINT COMMITTEES, INCLUDING ADVISORY  COMMITTEES  COMPRISING
 MEMBERS,  STATE  INSURANCE REGULATORS, STATE LEGISLATORS OR THEIR REPRE-
 SENTATIVES, INSURANCE INDUSTRY AND CONSUMER  REPRESENTATIVES,  AND  SUCH
 OTHER INTERESTED PERSONS AS MAY BE DESIGNATED IN THE BY-LAWS;
 S. 2794                             6

   (24)  TO  PROVIDE  AND RECEIVE INFORMATION FROM, AND TO COOPERATE WITH
 LAW ENFORCEMENT AGENCIES;
   (25) TO ADOPT AND USE A CORPORATE SEAL; AND
   (26)  TO PERFORM SUCH OTHER FUNCTIONS AS MAY BE NECESSARY OR APPROPRI-
 ATE TO ACHIEVE THE PURPOSES OF THIS COMPACT CONSISTENT  WITH  THE  STATE
 REGULATION OF THE BUSINESS OF INSURANCE.
   (B)  ALL DONATIONS, GRANTS OF MONEY, EQUIPMENT, SUPPLIES, MATERIALS OR
 SERVICES, PURCHASES, GIFTS, DONATIONS, CONVEYANCES, MORTGAGES,  PLEDGES,
 LEASES  AND  EXCHANGES, AS AUTHORIZED BY SUBSECTION (A) OF THIS SECTION,
 RECEIVED BY OR ON BEHALF OF THE  COMMISSION  SHALL  BE  LIMITED  TO  THE
 DIRECT  FUNDING  OF  THE LAWFUL AND AUTHORIZED OPERATIONS OF THE COMMIS-
 SION.
   § 8206. ORGANIZATION OF THE  COMMISSION.  (A)  EACH  COMPACTING  STATE
 SHALL  HAVE  AND BE LIMITED TO ONE MEMBER. THE SUPERINTENDENT, OR HIS OR
 HER DESIGNATED REPRESENTATIVE,  SHALL  BE  NEW  YORK'S  MEMBER  OF  SUCH
 COMMISSION.  EACH  MEMBER  SHALL  BE QUALIFIED TO SERVE IN SUCH CAPACITY
 PURSUANT TO APPLICABLE LAW OF THE COMPACTING STATE. ANY  MEMBER  MAY  BE
 REMOVED  OR  SUSPENDED  FROM  OFFICE AS PROVIDED BY THE LAW OF THE STATE
 FROM WHICH HE OR SHE SHALL BE APPOINTED. ANY VACANCY  OCCURRING  IN  THE
 COMMISSION SHALL BE FILLED IN ACCORDANCE WITH THE LAWS OF THE COMPACTING
 STATE  WHEREIN SUCH VACANCY EXISTS. NOTHING HEREIN SHALL BE CONSTRUED TO
 AFFECT THE MANNER IN WHICH A COMPACTING STATE DETERMINES THE ELECTION OR
 APPOINTMENT AND QUALIFICATION OF ITS OWN SUPERINTENDENT.
   (B) EACH MEMBER SHALL BE ENTITLED TO ONE VOTE AND SHALL HAVE AN OPPOR-
 TUNITY TO PARTICIPATE IN THE GOVERNANCE OF THE COMMISSION IN  ACCORDANCE
 WITH  THE  BY-LAWS. NOTWITHSTANDING ANY PROVISION OF THIS ARTICLE TO THE
 CONTRARY, NO ACTION OF THE COMMISSION WITH RESPECT TO  THE  PROMULGATION
 OF  A  UNIFORM  STANDARD  SHALL  BE  EFFECTIVE  UNLESS TWO-THIRDS OF THE
 MEMBERS VOTE IN FAVOR THEREOF.
   (C) THE COMMISSION SHALL, BY A  MAJORITY  OF  THE  MEMBERS,  PRESCRIBE
 BY-LAWS  TO  GOVERN  ITS  CONDUCT  AS MAY BE NECESSARY OR APPROPRIATE TO
 CARRY OUT THE PURPOSES, AND EXERCISE THE POWERS, OF THE COMPACT, INCLUD-
 ING, BUT NOT LIMITED TO:
   (1) ESTABLISHING THE FISCAL YEAR OF THE COMMISSION;
   (2) PROVIDING  REASONABLE  PROCEDURES  FOR  HOLDING  MEETINGS  OF  THE
 MANAGEMENT COMMITTEE;
   (3)  PROVIDING  REASONABLE STANDARDS AND PROCEDURES FOR THE ESTABLISH-
 MENT OF OTHER COMMITTEES, AND GOVERNING ANY GENERAL OR  SPECIFIC  DELEG-
 ATION OF ANY AUTHORITY OR FUNCTION OF THE COMMISSION;
   (4)  PROVIDING  REASONABLE PROCEDURES FOR CALLING AND CONDUCTING MEET-
 INGS OF THE COMMISSION THAT CONSIST OF A MAJORITY OF COMMISSION MEMBERS,
 ENSURING REASONABLE ADVANCE NOTICE OF EACH SUCH MEETING,  AND  PROVIDING
 FOR  THE  RIGHT  OF CITIZENS TO ATTEND EACH SUCH MEETING WITH ENUMERATED
 EXCEPTIONS DESIGNED TO PROTECT THE PUBLIC'S  INTEREST,  THE  PRIVACY  OF
 INDIVIDUALS  AND  INSURERS'  PROPRIETARY  INFORMATION,  INCLUDING  TRADE
 SECRETS. THE COMMISSION MAY MEET IN CAMERA ONLY AFTER A MAJORITY OF  THE
 ENTIRE  MEMBERSHIP  VOTES TO CLOSE A MEETING IN TOTO OR IN PART. AS SOON
 AS PRACTICABLE, THE COMMISSION MUST MAKE PUBLIC A COPY OF  THE  VOTE  TO
 CLOSE  THE MEETING REVEALING THE VOTE OF EACH MEMBER WITH NO PROXY VOTES
 ALLOWED, AND VOTES TAKEN DURING SUCH MEETING;
   (5) ESTABLISHING THE  TITLES,  DUTIES  AND  AUTHORITY  AND  REASONABLE
 PROCEDURES FOR THE ELECTION OF THE OFFICERS OF THE COMMISSION;
   (6)  PROVIDING  REASONABLE STANDARDS AND PROCEDURES FOR THE ESTABLISH-
 MENT OF THE PERSONNEL POLICIES AND PROGRAMS OF THE COMMISSION.  NOTWITH-
 STANDING ANY CIVIL SERVICE OR  OTHER  SIMILAR  LAWS  OF  ANY  COMPACTING
 S. 2794                             7
 
 STATE,  THE  BY-LAWS SHALL EXCLUSIVELY GOVERN THE PERSONNEL POLICIES AND
 PROGRAMS OF THE COMMISSION;
   (7) PROMULGATING A CODE OF ETHICS TO ADDRESS PERMISSIBLE AND PROHIBIT-
 ED ACTIVITIES OF COMMISSION MEMBERS AND EMPLOYEES; AND
   (8) PROVIDING A MECHANISM FOR WINDING UP THE OPERATIONS OF THE COMMIS-
 SION  AND  THE EQUITABLE DISPOSITION OF ANY SURPLUS FUNDS THAT MAY EXIST
 AFTER THE TERMINATION OF THE COMPACT AFTER THE PAYMENT AND/OR  RESERVING
 OF ALL OF ITS DEBTS AND OBLIGATIONS.
   (D)  THE COMMISSION SHALL PUBLISH ITS BY-LAWS IN A CONVENIENT FORM AND
 FILE A COPY THEREOF AND A COPY OF ANY AMENDMENT THERETO, WITH THE APPRO-
 PRIATE AGENCY OR OFFICER IN EACH OF THE COMPACTING STATES.
   (E) A MANAGEMENT COMMITTEE COMPRISING NO MORE  THAN  FOURTEEN  MEMBERS
 SHALL BE ESTABLISHED AS FOLLOWS:
   (1) ONE MEMBER FROM EACH OF THE SIX COMPACTING STATES WITH THE LARGEST
 PREMIUM  VOLUME  FOR  INDIVIDUAL  AND  GROUP ANNUITIES, LIFE, DISABILITY
 INCOME AND  LONG-TERM  CARE  INSURANCE  PRODUCTS,  DETERMINED  FROM  THE
 RECORDS OF THE NAIC AS OF DECEMBER THIRTY-FIRST OF THE PRIOR YEAR;
   (2)  FOUR  MEMBERS  FROM  THOSE  COMPACTING  STATES  WITH AT LEAST TWO
 PERCENT OF THE MARKET BASED ON THE PREMIUM VOLUME DESCRIBED IN PARAGRAPH
 ONE OF THIS SUBSECTION, OTHER THAN SIX COMPACTING STATES WITH THE  LARG-
 EST  PREMIUM  VOLUME,  SELECTED  ON  A ROTATING BASIS AS PROVIDED IN THE
 BY-LAWS; AND
   (3) FOUR MEMBERS FROM THOSE  COMPACTING  STATES  WITH  LESS  THAN  TWO
 PERCENT  OF  THE  MARKET, BASED ON THE PREMIUM VOLUME DESCRIBED IN PARA-
 GRAPH ONE OF THIS SUBSECTION, WITH ONE SELECTED FROM EACH  OF  THE  FOUR
 ZONE REGIONS OF THE NAIC AS PROVIDED IN THE BY-LAWS.
   (F)  THE  MANAGEMENT COMMITTEE SHALL HAVE SUCH AUTHORITY AND DUTIES AS
 MAY BE SET FORTH IN THE BY-LAWS, INCLUDING BUT NOT LIMITED TO:
   (1) MANAGING THE AFFAIRS OF THE COMMISSION IN A MANNER CONSISTENT WITH
 THE BY-LAWS AND PURPOSES OF THE COMMISSION;
   (2) ESTABLISHING AND OVERSEEING AN  ORGANIZATIONAL  STRUCTURE  WITHIN,
 AND  APPROPRIATE  PROCEDURES  FOR,  THE  COMMISSION  TO  PROVIDE FOR THE
 CREATION OF UNIFORM STANDARDS AND OTHER RULES,  RECEIPT  AND  REVIEW  OF
 PRODUCT  FILINGS, ADMINISTRATIVE AND TECHNICAL SUPPORT FUNCTIONS, REVIEW
 OF DECISIONS REGARDING THE DISAPPROVAL OF  A  PRODUCT  FILING,  AND  THE
 REVIEW  OF  ELECTIONS MADE BY A COMPACTING STATE TO OPT OUT OF A UNIFORM
 STANDARD; PROVIDED THAT A UNIFORM STANDARD SHALL NOT BE SUBMITTED TO THE
 COMPACTING STATES FOR ADOPTION UNLESS  APPROVED  BY  TWO-THIRDS  OF  THE
 MEMBERS OF THE MANAGEMENT COMMITTEE;
   (3) OVERSEEING THE OFFICES OF THE COMMISSION; AND
   (4) PLANNING, IMPLEMENTING, AND COORDINATING COMMUNICATIONS AND ACTIV-
 ITIES  WITH  OTHER  STATE, FEDERAL AND LOCAL GOVERNMENT ORGANIZATIONS IN
 ORDER TO ADVANCE THE GOALS OF THE COMMISSION.
   (G) THE COMMISSION SHALL ELECT ANNUALLY OFFICERS FROM  THE  MANAGEMENT
 COMMITTEE,  WITH EACH HAVING SUCH AUTHORITY AND DUTIES, AS MAY BE SPECI-
 FIED IN THE BY-LAWS.
   (H) THE MANAGEMENT COMMITTEE MAY,  SUBJECT  TO  THE  APPROVAL  OF  THE
 COMMISSION,  APPOINT  OR  RETAIN  AN EXECUTIVE DIRECTOR FOR SUCH PERIOD,
 UPON SUCH TERMS AND CONDITIONS AND FOR SUCH COMPENSATION AS THE  COMMIS-
 SION  MAY DEEM APPROPRIATE. THE EXECUTIVE DIRECTOR SHALL SERVE AS SECRE-
 TARY TO THE COMMISSION, BUT SHALL NOT BE A MEMBER OF THE COMMISSION. THE
 EXECUTIVE DIRECTOR SHALL HIRE AND SUPERVISE SUCH OTHER STAFF AS  MAY  BE
 AUTHORIZED BY THE COMMISSION.
   (I)  A  LEGISLATIVE  COMMITTEE  COMPRISING  STATE LEGISLATORS OR THEIR
 DESIGNEES SHALL BE ESTABLISHED TO MONITOR THE OPERATIONS  OF,  AND  MAKE
 RECOMMENDATIONS   TO,  THE  COMMISSION;  PROVIDED  THAT  THE  MANNER  OF
 S. 2794                             8
 
 SELECTION AND TERM OF ANY LEGISLATIVE COMMITTEE MEMBER SHALL BE  AS  SET
 FORTH  IN  THE  BY-LAWS.  PRIOR TO THE ADOPTION BY THE COMMISSION OF ANY
 UNIFORM STANDARD, REVISION  TO  THE  BY-LAWS,  ANNUAL  BUDGET  OR  OTHER
 SIGNIFICANT  MATTER  AS  MAY  BE PROVIDED IN THE BY-LAWS, THE MANAGEMENT
 COMMITTEE SHALL CONSULT WITH AND REPORT TO THE LEGISLATIVE COMMITTEE.
   (J) THE COMMISSION SHALL ESTABLISH TWO  ADVISORY  COMMITTEES,  ONE  OF
 WHICH  SHALL COMPRISE CONSUMER REPRESENTATIVES INDEPENDENT OF THE INSUR-
 ANCE INDUSTRY AND THE  OTHER  COMPRISING  INSURANCE  INDUSTRY  REPRESEN-
 TATIVES.
   (K) THE COMMISSION MAY ESTABLISH ADDITIONAL ADVISORY COMMITTEES AS ITS
 BY-LAWS MAY PROVIDE FOR THE CARRYING OUT OF ITS FUNCTIONS.
   (L)  THE  COMMISSION SHALL MAINTAIN ITS CORPORATE BOOKS AND RECORDS IN
 ACCORDANCE WITH THE BY-LAWS.
   (M) THE MEMBERS, OFFICERS, EXECUTIVE DIRECTOR, EMPLOYEES AND REPRESEN-
 TATIVES OF THE COMMISSION SHALL  BE  IMMUNE  FROM  SUIT  AND  LIABILITY,
 EITHER  PERSONALLY  OR  IN THEIR OFFICIAL CAPACITY, FOR ANY ACTION TAKEN
 REASONABLY AND IN GOOD FAITH WHICH RESULTS IN A CLAIM FOR DAMAGE  TO  OR
 LOSS  OF  PROPERTY OR PERSONAL INJURY OR OTHER CIVIL LIABILITY CAUSED BY
 OR ARISING OUT OF ANY ACTUAL OR ALLEGED  ACT,  ERROR  OR  OMISSION  THAT
 OCCURRED,  OR  THAT  SUCH  PERSON  HAD  A REASONABLE BASIS FOR BELIEVING
 OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR  RESPONSI-
 BILITIES;  PROVIDED,  THAT NOTHING IN THIS SECTION SHALL BE CONSTRUED TO
 PROTECT ANY SUCH PERSON FROM SUIT AND/OR LIABILITY FOR ANY DAMAGE, LOSS,
 INJURY OR LIABILITY CAUSED BY THE  INTENTIONAL  OR  WILLFUL  AND  WANTON
 MISCONDUCT OF THAT PERSON.
   (N)  THE COMMISSION SHALL DEFEND ANY MEMBER, OFFICER, EXECUTIVE DIREC-
 TOR, EMPLOYEE OR REPRESENTATIVE OF THE COMMISSION IN  ANY  CIVIL  ACTION
 SEEKING  TO  IMPOSE  LIABILITY ARISING OUT OF ANY ACTUAL OR ALLEGED ACT,
 ERROR OR OMISSION THAT OCCURRED WITHIN THE SCOPE OF  COMMISSION  EMPLOY-
 MENT, DUTIES OR RESPONSIBILITIES, OR THAT THE DEFENDANT HAD A REASONABLE
 BASIS  FOR BELIEVING OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOYMENT,
 DUTIES OR RESPONSIBILITIES; PROVIDED, THAT NOTHING IN THIS SECTION SHALL
 BE CONSTRUED TO PROHIBIT THAT PERSON FROM RETAINING HIS OR HER OWN COUN-
 SEL; AND PROVIDED FURTHER, THAT THE ACTUAL  OR  ALLEGED  ACT,  ERROR  OR
 OMISSION  DID  NOT  RESULT FROM THAT PERSON'S INTENTIONAL OR WILLFUL AND
 WANTON MISCONDUCT.
   (O) THE COMMISSION SHALL INDEMNIFY AND HOLD HARMLESS ANY MEMBER, OFFI-
 CER, EXECUTIVE DIRECTOR, EMPLOYEE OR REPRESENTATIVE  OF  THE  COMMISSION
 FOR  THE  AMOUNT  OF  ANY  SETTLEMENT  OR JUDGMENT OBTAINED AGAINST SUCH
 PERSONS ARISING OUT OF ANY ACTUAL OR ALLEGED ACT, ERROR OR OMISSION THAT
 OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR  RESPONSI-
 BILITIES,  OR  THAT  SUCH  PERSON  HAD  A REASONABLE BASIS FOR BELIEVING
 OCCURRED WITHIN THE SCOPE OF COMMISSION EMPLOYMENT, DUTIES OR  RESPONSI-
 BILITIES,  PROVIDED,  THAT  THE ACTUAL OR ALLEGED ACT, ERROR OR OMISSION
 DID NOT RESULT FROM THE INTENTIONAL OR WILLFUL AND WANTON MISCONDUCT  OF
 ANY SUCH PERSON.
   §  8207. MEETINGS AND ACTS OF THE COMMISSION. (A) THE COMMISSION SHALL
 MEET AND TAKE SUCH ACTIONS AS ARE CONSISTENT WITH THE PROVISIONS OF THIS
 COMPACT AND THE BY-LAWS.
   (B) EACH MEMBER OF THE COMMISSION SHALL HAVE THE RIGHT  AND  POWER  TO
 CAST  A  VOTE  TO WHICH THAT COMPACTING STATE IS ENTITLED AND TO PARTIC-
 IPATE IN THE BUSINESS AND AFFAIRS OF THE COMMISSION. A MEMBER SHALL VOTE
 IN PERSON OR BY SUCH OTHER MEANS AS PROVIDED IN THE BY-LAWS. THE BY-LAWS
 MAY PROVIDE FOR MEMBERS' PARTICIPATION IN MEETINGS BY TELEPHONE OR OTHER
 MEANS OF COMMUNICATION.
 S. 2794                             9
 
   (C) THE COMMISSION SHALL MEET AT LEAST ONCE DURING EACH CALENDAR YEAR.
 ADDITIONAL MEETINGS SHALL BE HELD AS SET FORTH IN THE BY-LAWS.
   §  8208.  RULES AND OPERATING PROCEDURES; RULE MAKING FUNCTIONS OF THE
 COMMISSION AND OPTING OUT OF UNIFORM STANDARDS. (A) THE COMMISSION SHALL
 PROMULGATE REASONABLE RULES, INCLUDING UNIFORM STANDARDS  AND  OPERATING
 PROCEDURES, IN ORDER TO EFFECTIVELY AND EFFICIENTLY ACHIEVE THE PURPOSES
 OF  THE COMPACT. NOTWITHSTANDING THE FOREGOING, IN THE EVENT THE COMMIS-
 SION EXERCISES ITS RULE MAKING AUTHORITY IN A MANNER THAT IS BEYOND  THE
 SCOPE  OF  THE  PURPOSES  OF THIS ARTICLE, OR THE POWERS GRANTED IN THIS
 SECTION, THEN SUCH ACTION BY THE COMMISSION SHALL BE INVALID AND HAVE NO
 FORCE AND EFFECT.
   (B) RULES AND OPERATING PROCEDURES SHALL BE MADE PURSUANT  TO  A  RULE
 MAKING  PROCESS  THAT CONFORMS TO THE STATE ADMINISTRATIVE PROCEDURE ACT
 OF 1981 AS AMENDED, AS MAY BE  APPROPRIATE  TO  THE  OPERATIONS  OF  THE
 COMMISSION. BEFORE THE COMMISSION ADOPTS A UNIFORM STANDARD, THE COMMIS-
 SION SHALL GIVE WRITTEN NOTICE TO THE RELEVANT STATE LEGISLATIVE COMMIT-
 TEE  IN  EACH  COMPACTING  STATE RESPONSIBLE FOR INSURANCE ISSUES OF ITS
 INTENTION TO ADOPT SUCH UNIFORM STANDARD. THE COMMISSION IN  ADOPTING  A
 UNIFORM  STANDARD SHALL CONSIDER FULLY ALL SUBMITTED MATERIALS AND ISSUE
 A CONCISE EXPLANATION OF ITS DECISION.
   (C) A UNIFORM STANDARD SHALL BECOME EFFECTIVE NINETY  DAYS  AFTER  ITS
 PROMULGATION  BY THE COMMISSION OR SUCH LATER DATE AS THE COMMISSION MAY
 DETERMINE; PROVIDED, HOWEVER, THAT A COMPACTING STATE MAY OPT OUT  OF  A
 UNIFORM STANDARD AS PROVIDED IN THIS ARTICLE. "OPT OUT" SHALL BE DEFINED
 AS  ANY  ACTION BY A COMPACTING STATE TO DECLINE TO ADOPT OR PARTICIPATE
 IN A PROMULGATED UNIFORM STANDARD. ALL OTHER RULES AND OPERATING  PROCE-
 DURES,  AND  AMENDMENTS  THERETO,  SHALL BECOME EFFECTIVE AS OF THE DATE
 SPECIFIED IN EACH RULE, OPERATING PROCEDURE OR AMENDMENT.
   (D) A COMPACTING STATE MAY OPT OUT OF A UNIFORM  STANDARD,  EITHER  BY
 LEGISLATION  OR  REGULATION DULY PROMULGATED BY THE SUPERINTENDENT UNDER
 THE STATE ADMINISTRATIVE PROCEDURE ACT. IF A COMPACTING STATE ELECTS  TO
 OPT OUT OF A UNIFORM STANDARD BY REGULATION, IT MUST GIVE WRITTEN NOTICE
 TO  THE  COMMISSION  NO  LATER  THAN TEN BUSINESS DAYS AFTER THE UNIFORM
 STANDARD IS PROMULGATED OR AT THE TIME THE STATE  BECOMES  A  COMPACTING
 STATE,  AND  FIND  THAT THE UNIFORM STANDARD DOES NOT PROVIDE REASONABLE
 PROTECTIONS TO THE CITIZENS OF THE STATE GIVEN  THE  CONDITIONS  IN  THE
 STATE.  THE  SUPERINTENDENT  SHALL  MAKE  SPECIFIC  FINDINGS OF FACT AND
 CONCLUSIONS OF LAW, BASED ON A PREPONDERANCE OF THE EVIDENCE,  DETAILING
 THE  CONDITIONS  IN THE STATE WHICH WARRANT A DEPARTURE FROM THE UNIFORM
 STANDARD AND DETERMINING THAT THE UNIFORM STANDARD WOULD NOT  REASONABLY
 PROTECT  THE CITIZENS OF THE STATE. THE SUPERINTENDENT MUST CONSIDER AND
 BALANCE THE FOLLOWING FACTORS AND FIND THAT THE CONDITIONS IN THE  STATE
 AND NEEDS OF THE CITIZENS OF THE STATE OUTWEIGH:
   (1)  THE INTENT OF THE LEGISLATURE TO PARTICIPATE IN, AND THE BENEFITS
 OF, AN INTERSTATE  AGREEMENT  TO  ESTABLISH  NATIONAL  UNIFORM  CONSUMER
 PROTECTIONS FOR THE PRODUCTS SUBJECT TO THIS ARTICLE; AND
   (2)  THE PRESUMPTION THAT A UNIFORM STANDARD ADOPTED BY THE COMMISSION
 PROVIDES REASONABLE PROTECTIONS TO CONSUMERS OF THE RELEVANT PRODUCT.
   NOTWITHSTANDING THE FOREGOING, A COMPACTING STATE MAY, AT THE TIME  OF
 ITS ENACTMENT OF THE COMPACT, PROSPECTIVELY OPT OUT OF ALL UNIFORM STAN-
 DARDS  INVOLVING  THE  LONG-TERM  CARE  INSURANCE  PRODUCTS BY EXPRESSLY
 PROVIDING FOR SUCH OPT OUT IN THE ENACTED  COMPACT,  AND  SUCH  OPT  OUT
 SHALL  NOT  BE TREATED AS A MATERIAL VARIANCE IN THE OFFER OR ACCEPTANCE
 OF ANY STATE TO PARTICIPATE IN THE COMPACT. SUCH AN  OPT  OUT  SHALL  BE
 EFFECTIVE  AT  THE  TIME  OF  ENACTMENT OF THE COMPACT BY THE COMPACTING
 S. 2794                            10

 STATE AND SHALL APPLY TO ALL EXISTING UNIFORM STANDARDS INVOLVING  LONG-
 TERM CARE INSURANCE PRODUCTS AND THOSE SUBSEQUENTLY PROMULGATED.
   (E) IF A COMPACTING STATE ELECTS TO OPT OUT OF A UNIFORM STANDARD, THE
 UNIFORM  STANDARD SHALL REMAIN APPLICABLE IN THE COMPACTING STATE ELECT-
 ING TO OPT OUT UNTIL SUCH TIME THE OPT OUT LEGISLATION IS  ENACTED  INTO
 LAW OR THE REGULATION IS PROMULGATED.
   (F)  ONCE  THE  OPT  OUT  OF  A UNIFORM STANDARD BY A COMPACTING STATE
 BECOMES EFFECTIVE AS PROVIDED UNDER THE LAWS OF THAT STATE, THE  UNIFORM
 STANDARD SHALL HAVE NO FURTHER FORCE AND EFFECT IN THAT STATE UNLESS AND
 UNTIL THE LEGISLATION OR REGULATION IMPLEMENTING THE OPT OUT IS REPEALED
 OR  OTHERWISE  BECOMES  INEFFECTIVE  UNDER  THE  LAWS OF THE STATE. IF A
 COMPACTING STATE OPTS OUT OF A UNIFORM STANDARD AFTER THE UNIFORM STAND-
 ARD HAS BEEN MADE EFFECTIVE IN THAT STATE, THE OPT OUT  SHALL  HAVE  THE
 SAME  PROSPECTIVE  EFFECT  AS  PROVIDED UNDER SECTION EIGHT THOUSAND TWO
 HUNDRED FIFTEEN OF THIS ARTICLE FOR WITHDRAWALS.
   (G) IF A COMPACTING STATE HAS FORMALLY INITIATED THE PROCESS OF OPTING
 OUT OF A UNIFORM STANDARD BY REGULATION, AND WHILE  THE  REGULATORY  OPT
 OUT  IS  PENDING,  THE  COMPACTING STATE MAY PETITION THE COMMISSION, AT
 LEAST FIFTEEN DAYS BEFORE THE EFFECTIVE DATE OF THE UNIFORM STANDARD, TO
 STAY THE EFFECTIVENESS OF  THE  UNIFORM  STANDARD  IN  THAT  STATE.  THE
 COMMISSION  MAY  GRANT A STAY IF IT DETERMINES THE REGULATORY OPT OUT IS
 BEING PURSUED IN A REASONABLE  MANNER  AND  THERE  IS  A  LIKELIHOOD  OF
 SUCCESS. IF A STAY IS GRANTED OR EXTENDED BY THE COMMISSION, THE STAY OR
 EXTENSION  THEREOF MAY POSTPONE THE EFFECTIVE DATE BY UP TO NINETY DAYS,
 UNLESS AFFIRMATIVELY EXTENDED BY THE  COMMISSION;  PROVIDED  HOWEVER,  A
 STAY  MAY  NOT  BE  PERMITTED TO REMAIN IN EFFECT FOR MORE THAN ONE YEAR
 UNLESS THE COMPACTING STATE CAN SHOW EXTRAORDINARY  CIRCUMSTANCES  WHICH
 WARRANT  A  CONTINUANCE  OF  THE STAY INCLUDING, BUT NOT LIMITED TO, THE
 EXISTENCE OF A LEGAL CHALLENGE WHICH PREVENTS THE COMPACTING STATE  FROM
 OPTING  OUT. A STAY MAY BE TERMINATED BY THE COMMISSION UPON NOTICE THAT
 THE RULE MAKING PROCESS HAS BEEN TERMINATED.
   (H) NOT LATER THAN THIRTY DAYS AFTER A RULE OR OPERATING PROCEDURE  IS
 PROMULGATED,  ANY  PERSON MAY FILE A PETITION FOR JUDICIAL REVIEW OF THE
 RULE OR OPERATING PROCEDURE; PROVIDED, HOWEVER, THAT THE FILING OF  SUCH
 A  PETITION  SHALL  NOT  STAY OR OTHERWISE PREVENT THE RULE OR OPERATING
 PROCEDURE FROM BECOMING EFFECTIVE UNLESS THE COURT FINDS THAT THE  PETI-
 TIONER  HAS  A  SUBSTANTIAL  LIKELIHOOD OF SUCCESS. THE COURT SHALL GIVE
 DEFERENCE TO THE ACTIONS OF THE COMMISSION  CONSISTENT  WITH  APPLICABLE
 LAW AND SHALL NOT FIND THE RULE OR OPERATING PROCEDURE TO BE UNLAWFUL IF
 THE  RULE OR OPERATING PROCEDURE REPRESENTS A REASONABLE EXERCISE OF THE
 COMMISSION'S AUTHORITY.
   § 8209. COMMISSION RECORDS AND ENFORCEMENT. (A) THE  COMMISSION  SHALL
 PROMULGATE  RULES  ESTABLISHING  CONDITIONS  AND  PROCEDURES  FOR PUBLIC
 INSPECTION AND COPYING OF ITS INFORMATION AND OFFICIAL  RECORDS,  EXCEPT
 SUCH  INFORMATION  AND  RECORDS INVOLVING THE PRIVACY OF INDIVIDUALS AND
 INSURERS' TRADE SECRETS. THE COMMISSION MAY PROMULGATE ADDITIONAL  RULES
 UNDER WHICH IT MAY MAKE AVAILABLE TO FEDERAL AND STATE AGENCIES, INCLUD-
 ING  LAW  ENFORCEMENT AGENCIES, RECORDS AND INFORMATION OTHERWISE EXEMPT
 FROM DISCLOSURE, AND MAY ENTER INTO AGREEMENTS  WITH  SUCH  AGENCIES  TO
 RECEIVE  OR EXCHANGE INFORMATION OR RECORDS SUBJECT TO NONDISCLOSURE AND
 CONFIDENTIALITY PROVISIONS.
   (B) EXCEPT AS TO PRIVILEGED RECORDS, DATA AND INFORMATION, THE LAWS OF
 ANY COMPACTING STATE  PERTAINING  TO  CONFIDENTIALITY  OR  NONDISCLOSURE
 SHALL  NOT  RELIEVE  ANY  COMPACTING  STATE  COMMISSIONER OF THE DUTY TO
 DISCLOSE ANY RELEVANT RECORDS, DATA OR INFORMATION  TO  THE  COMMISSION;
 PROVIDED  HOWEVER, THAT DISCLOSURE TO THE COMMISSION SHALL NOT BE DEEMED
 S. 2794                            11
 
 TO WAIVE  OR  OTHERWISE  AFFECT  ANY  CONFIDENTIALITY  REQUIREMENT;  AND
 PROVIDED  FURTHER  THAT,  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS
 ARTICLE, THE COMMISSION SHALL NOT BE SUBJECT TO THE LAWS OF ANY COMPACT-
 ING  STATE  PERTAINING TO CONFIDENTIALITY AND NONDISCLOSURE WITH RESPECT
 TO RECORDS, DATA AND INFORMATION IN ITS POSSESSION. CONFIDENTIAL  INFOR-
 MATION  OF  THE COMMISSION SHALL REMAIN CONFIDENTIAL AFTER SUCH INFORMA-
 TION IS PROVIDED TO ANY COMMISSIONER.
   (C) THE COMMISSION SHALL MONITOR COMPACTING STATES FOR COMPLIANCE WITH
 DULY ADOPTED BY-LAWS, RULES, INCLUDING UNIFORM STANDARDS, AND  OPERATING
 PROCEDURES.  THE  COMMISSION  SHALL  NOTIFY SUCH NONCOMPLYING COMPACTING
 STATE IN WRITING OF ITS NONCOMPLIANCE WITH COMMISSION BY-LAWS, RULES  OR
 OPERATING  PROCEDURES.  IF  THE  NONCOMPLYING  COMPACTING STATE FAILS TO
 REMEDY SUCH NONCOMPLIANCE WITHIN THE TIME SPECIFIED  IN  THE  NOTICE  OF
 NONCOMPLIANCE,  THE COMPACTING STATE SHALL BE DEEMED TO BE IN DEFAULT AS
 SET FORTH IN SECTION EIGHT THOUSAND TWO HUNDRED FIFTEEN OF THIS ARTICLE.
   (D) THE COMMISSIONER OF ANY STATE IN WHICH AN INSURER IS AUTHORIZED TO
 DO BUSINESS, OR IS CONDUCTING THE BUSINESS OF INSURANCE, SHALL  CONTINUE
 TO EXERCISE HIS OR HER AUTHORITY TO OVERSEE THE MARKET REGULATION OF THE
 ACTIVITIES  OF  THE  INSURER  IN  ACCORDANCE  WITH THE PROVISIONS OF THE
 STATE'S LAW. THE  COMMISSIONER'S  ENFORCEMENT  OF  COMPLIANCE  WITH  THE
 COMPACT IS GOVERNED BY THE FOLLOWING PROVISIONS:
   (1)  WITH RESPECT TO THE COMMISSIONER'S MARKET REGULATION OF A PRODUCT
 OR ADVERTISEMENT THAT IS APPROVED OR CERTIFIED BY  THE  COMMISSION,  THE
 CONTENT OF THE PRODUCT OR ADVERTISEMENT SHALL NOT CONSTITUTE A VIOLATION
 OF  THE PROVISIONS, STANDARDS OR REQUIREMENTS OF THE COMPACT EXCEPT UPON
 A FINAL ORDER OF THE COMMISSION, ISSUED AT THE REQUEST OF A COMMISSIONER
 AFTER PRIOR NOTICE TO THE INSURER AND AN OPPORTUNITY FOR HEARING  BEFORE
 THE COMMISSION.
   (2)  BEFORE  A  COMMISSIONER  MAY BRING AN ACTION FOR VIOLATION OF ANY
 PROVISION, STANDARD OR  REQUIREMENT  OF  THE  COMPACT  RELATING  TO  THE
 CONTENT OF AN ADVERTISEMENT NOT APPROVED OR CERTIFIED BY THE COMMISSION,
 THE  COMMISSION  OR  AN  AUTHORIZED COMMISSION OFFICER OR EMPLOYEE, MUST
 AUTHORIZE THE ACTION. HOWEVER, AUTHORIZATION PURSUANT TO THIS  PARAGRAPH
 DOES  NOT  REQUIRE  NOTICE  TO  THE  INSURER, OPPORTUNITY FOR HEARING OR
 DISCLOSURE OF REQUESTS FOR AUTHORIZATION OR RECORDS OF THE  COMMISSION'S
 ACTION ON SUCH REQUESTS.
   §  8210.  DISPUTE  RESOLUTION.  THE COMMISSION SHALL ATTEMPT, UPON THE
 REQUEST OF A MEMBER, TO RESOLVE ANY DISPUTES OR OTHER  ISSUES  THAT  ARE
 SUBJECT TO THIS COMPACT AND WHICH MAY ARISE BETWEEN TWO OR MORE COMPACT-
 ING  STATES, OR BETWEEN COMPACTING STATES AND NON-COMPACTING STATES, AND
 THE COMMISSION SHALL PROMULGATE AN  OPERATING  PROCEDURE  PROVIDING  FOR
 RESOLUTION OF SUCH DISPUTES.
   §  8211.  PRODUCT  FILING  AND  APPROVAL. (A) INSURERS AND THIRD-PARTY
 FILERS SEEKING TO HAVE A PRODUCT APPROVED BY THE COMMISSION  SHALL  FILE
 SUCH  PRODUCT  WITH,  AND PAY APPLICABLE FILING FEES TO, THE COMMISSION.
 NOTHING IN THIS ARTICLE SHALL BE  CONSTRUED  TO  RESTRICT  OR  OTHERWISE
 PREVENT AN INSURER FROM FILING ITS PRODUCT WITH THE INSURANCE DEPARTMENT
 IN ANY STATE WHEREIN SUCH INSURER IS LICENSED TO CONDUCT THE BUSINESS OF
 INSURANCE,  AND  SUCH  FILING SHALL BE SUBJECT TO THE LAWS OF THE STATES
 WHERE FILED.
   (B) THE COMMISSION SHALL ESTABLISH APPROPRIATE FILING AND REVIEW PROC-
 ESSES AND PROCEDURES PURSUANT TO COMMISSION RULES AND  OPERATING  PROCE-
 DURES.  NOTWITHSTANDING  ANY  PROVISION IN THIS SECTION TO THE CONTRARY,
 THE COMMISSION SHALL PROMULGATE RULES TO ESTABLISH CONDITIONS AND PROCE-
 DURES UNDER WHICH THE COMMISSION WILL PROVIDE PUBLIC ACCESS  TO  PRODUCT
 FILING  INFORMATION.  IN  ESTABLISHING  SUCH RULES, THE COMMISSION SHALL
 S. 2794                            12

 CONSIDER THE INTERESTS OF THE PUBLIC IN HAVING ACCESS TO  SUCH  INFORMA-
 TION,  AS  WELL AS PROTECTION OF PERSONAL MEDICAL AND FINANCIAL INFORMA-
 TION AND TRADE SECRETS, THAT MAY BE CONTAINED IN  A  PRODUCT  FILING  OR
 SUPPORTING INFORMATION.
   (C)  ANY  PRODUCT  APPROVED BY THE COMMISSION MAY BE SOLD OR OTHERWISE
 ISSUED IN THOSE COMPACTING  STATES  IN  WHICH  THE  INSURER  IS  LEGALLY
 AUTHORIZED TO DO BUSINESS.
   §  8212.  REVIEW  OF  COMMISSION  DECISIONS REGARDING FILINGS. (A) NOT
 LATER THAN THIRTY DAYS AFTER THE COMMISSION HAS GIVEN NOTICE OF A DISAP-
 PROVED PRODUCT OR ADVERTISEMENT FILED WITH THE COMMISSION,  THE  INSURER
 OR  THIRD PARTY FILER WHOSE FILING WAS DISAPPROVED MAY APPEAL THE DETER-
 MINATION TO A REVIEW PANEL APPOINTED BY THE COMMISSION.  THE  COMMISSION
 SHALL  PROMULGATE  RULES  TO  ESTABLISH  PROCEDURES  FOR APPOINTING SUCH
 REVIEW PANEL AND PROVIDE FOR NOTICE AND HEARING. AN ALLEGATION THAT  THE
 COMMISSION,  IN  DISAPPROVING  A PRODUCT OR ADVERTISEMENT FILED WITH THE
 COMMISSION, ACTED ARBITRARILY, CAPRICIOUSLY OR IN A MANNER  THAT  IS  AN
 ABUSE  OF DISCRETION OR OTHERWISE NOT IN ACCORDANCE WITH LAW, IS SUBJECT
 TO JUDICIAL REVIEW IN ACCORDANCE WITH SUBSECTION (E)  OF  SECTION  EIGHT
 THOUSAND TWO HUNDRED FOUR OF THIS ARTICLE.
   (B)  THE COMMISSION SHALL HAVE AUTHORITY TO MONITOR, REVIEW AND RECON-
 SIDER PRODUCTS AND ADVERTISEMENT SUBSEQUENT TO THEIR FILING OR  APPROVAL
 UPON A FINDING THAT THE PRODUCT DOES NOT MEET THE RELEVANT UNIFORM STAN-
 DARD.  WHERE  APPROPRIATE,  THE  COMMISSION  MAY  WITHDRAW OR MODIFY ITS
 APPROVAL AFTER PROPER NOTICE AND HEARING, SUBJECT TO THE APPEAL  PROCESS
 SET FORTH IN SUBSECTION (A) OF THIS SECTION.
   §  8213.  FINANCE.  (A)  THE  COMMISSION  SHALL PAY OR PROVIDE FOR THE
 PAYMENT OF THE REASONABLE EXPENSES OF ITS  ESTABLISHMENT  AND  ORGANIZA-
 TION.  TO  FUND  THE  COST OF ITS INITIAL OPERATIONS, THE COMMISSION MAY
 ACCEPT CONTRIBUTIONS AND OTHER FORMS OF FUNDING FROM THE NAIC,  COMPACT-
 ING  STATES  AND OTHER SOURCES. CONTRIBUTIONS AND OTHER FORMS OF FUNDING
 FROM OTHER SOURCES SHALL BE OF SUCH A NATURE THAT  THE  INDEPENDENCE  OF
 THE  COMMISSION  CONCERNING  THE  PERFORMANCE OF ITS DUTIES SHALL NOT BE
 COMPROMISED.
   (B) THE COMMISSION SHALL COLLECT A FILING FEE FROM  EACH  INSURER  AND
 THIRD PARTY FILER FILING A PRODUCT WITH THE COMMISSION TO COVER THE COST
 OF  THE  OPERATIONS  AND ACTIVITIES OF THE COMMISSION AND ITS STAFF IN A
 TOTAL AMOUNT SUFFICIENT TO COVER THE COMMISSION'S ANNUAL BUDGET.
   (C) THE COMMISSION'S BUDGET FOR A FISCAL YEAR SHALL  NOT  BE  APPROVED
 UNTIL  IT HAS BEEN SUBJECT TO NOTICE AND COMMENT AS SET FORTH IN SECTION
 EIGHT THOUSAND TWO HUNDRED EIGHT OF THIS ARTICLE.
   (D) THE COMMISSION SHALL BE EXEMPT FROM ALL TAXATION  IN  AND  BY  THE
 COMPACTING STATES.
   (E)  THE  COMMISSION  SHALL  NOT  PLEDGE  THE CREDIT OF ANY COMPACTING
 STATE, EXCEPT BY AND  WITH  THE  APPROPRIATE  LEGAL  AUTHORITY  OF  THAT
 COMPACTING STATE.
   (F)  THE  COMMISSION  SHALL KEEP COMPLETE AND ACCURATE ACCOUNTS OF ALL
 ITS INTERNAL RECEIPTS, INCLUDING GRANTS AND DONATIONS AND  DISBURSEMENTS
 OF  ALL  FUNDS UNDER ITS CONTROL. THE INTERNAL FINANCIAL ACCOUNTS OF THE
 COMMISSION SHALL BE SUBJECT TO  THE  ACCOUNTING  PROCEDURES  ESTABLISHED
 UNDER  ITS  BY-LAWS.  THE  FINANCIAL  ACCOUNTS AND REPORTS INCLUDING THE
 SYSTEM OF INTERNAL CONTROLS AND PROCEDURES OF THE  COMMISSION  SHALL  BE
 AUDITED ANNUALLY BY AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT. UPON THE
 DETERMINATION OF THE COMMISSION, BUT NO LESS FREQUENTLY THAN EVERY THREE
 YEARS, THE REVIEW OF SUCH INDEPENDENT AUDITOR SHALL INCLUDE A MANAGEMENT
 AND  PERFORMANCE  AUDIT  OF THE COMMISSION. THE COMMISSION SHALL MAKE AN
 ANNUAL REPORT TO THE GOVERNOR AND LEGISLATURE OF THE COMPACTING  STATES,
 S. 2794                            13
 
 WHICH SHALL INCLUDE A REPORT OF SUCH INDEPENDENT AUDIT. THE COMMISSION'S
 INTERNAL  ACCOUNTS  SHALL  NOT BE CONFIDENTIAL AND SUCH MATERIALS MAY BE
 SHARED WITH THE COMMISSIONER  OF  ANY  COMPACTING  STATE  UPON  REQUEST,
 PROVIDED, HOWEVER, THAT ANY WORK PAPERS RELATED TO ANY INTERNAL OR INDE-
 PENDENT  AUDIT  AND ANY INFORMATION REGARDING THE PRIVACY OF INDIVIDUALS
 AND INSURERS' PROPRIETARY INFORMATION, INCLUDING  TRADE  SECRETS,  SHALL
 REMAIN CONFIDENTIAL.
   (G)  NO  COMPACTING  STATE SHALL HAVE ANY CLAIM TO OR OWNERSHIP OF ANY
 PROPERTY HELD BY OR VESTED IN THE COMMISSION OR TO ANY COMMISSION  FUNDS
 HELD PURSUANT TO THE PROVISIONS OF THIS COMPACT.
   § 8214. COMPACTING STATES, EFFECTIVE DATE AND AMENDMENT. (A) ANY STATE
 IS ELIGIBLE TO BECOME A COMPACTING STATE.
   (B)  THE  COMPACT  SHALL BECOME EFFECTIVE AND BINDING UPON LEGISLATIVE
 ENACTMENT OF THE COMPACT INTO LAW BY  TWO  COMPACTING  STATES;  PROVIDED
 HOWEVER,  THAT  THE  COMMISSION  SHALL  BECOME EFFECTIVE FOR PURPOSES OF
 ADOPTING UNIFORM STANDARDS FOR REVIEWING, AND GIVING APPROVAL OR  DISAP-
 PROVAL  OF,  PRODUCTS  FILED WITH THE COMMISSION THAT SATISFY APPLICABLE
 UNIFORM STANDARDS ONLY AFTER TWENTY-SIX STATES ARE COMPACTING STATES OR,
 ALTERNATIVELY, BY STATES REPRESENTING GREATER THAN FORTY PERCENT OF  THE
 PREMIUM  VOLUME FOR LIFE INSURANCE, ANNUITY, DISABILITY INCOME AND LONG-
 TERM CARE INSURANCE PRODUCTS, BASED ON RECORDS OF THE NAIC FOR THE PRIOR
 YEAR. THEREAFTER, IT SHALL BECOME EFFECTIVE AND BINDING AS TO ANY  OTHER
 COMPACTING STATE UPON ENACTMENT OF THE COMPACT INTO LAW BY THAT STATE.
   (C)  AMENDMENTS  TO  THE COMPACT MAY BE PROPOSED BY THE COMMISSION FOR
 ENACTMENT BY THE COMPACTING STATES. NO AMENDMENT SHALL BECOME  EFFECTIVE
 AND  BINDING  UPON  THE  COMMISSION AND THE COMPACTING STATES UNLESS AND
 UNTIL ALL COMPACTING STATES ENACT THE AMENDMENT INTO LAW.
   § 8215. WITHDRAWAL, DEFAULT AND TERMINATION.  (A)(1)  ONCE  EFFECTIVE,
 THE  COMPACT  SHALL  CONTINUE  IN FORCE AND REMAIN BINDING UPON EACH AND
 EVERY COMPACTING STATE; PROVIDED THAT A COMPACTING  STATE  MAY  WITHDRAW
 FROM  THE  COMPACT  ("WITHDRAWING  STATE") BY ENACTING A STATUTE SPECIF-
 ICALLY REPEALING THE STATUTE WHICH ENACTED THE COMPACT INTO LAW.
   (2) THE EFFECTIVE DATE OF WITHDRAWAL IS  THE  EFFECTIVE  DATE  OF  THE
 REPEALING STATUTE.  HOWEVER, THE WITHDRAWAL SHALL NOT APPLY TO ANY PROD-
 UCT  FILINGS  APPROVED  OR  SELF-CERTIFIED, OR ANY ADVERTISEMENT OF SUCH
 PRODUCTS, ON THE DATE THE REPEALING STATUTE BECOMES EFFECTIVE, EXCEPT BY
 MUTUAL AGREEMENT OF THE COMMISSION AND THE WITHDRAWING STATE UNLESS  THE
 APPROVAL  IS RESCINDED BY THE WITHDRAWING STATE AS PROVIDED IN PARAGRAPH
 FIVE OF THIS SUBSECTION.
   (3) THE COMMISSIONER OF THE WITHDRAWING STATE SHALL IMMEDIATELY NOTIFY
 THE MANAGEMENT COMMITTEE IN WRITING UPON THE INTRODUCTION OF LEGISLATION
 REPEALING THIS COMPACT IN THE WITHDRAWING STATE.
   (4) THE COMMISSION SHALL NOTIFY THE OTHER  COMPACTING  STATES  OF  THE
 INTRODUCTION  OF  SUCH  LEGISLATION WITHIN TEN DAYS AFTER ITS RECEIPT OF
 NOTICE THEREOF.
   (5) THE WITHDRAWING STATE IS RESPONSIBLE FOR ALL  OBLIGATIONS,  DUTIES
 AND  LIABILITIES  INCURRED  THROUGH  THE  EFFECTIVE  DATE OF WITHDRAWAL,
 INCLUDING ANY OBLIGATIONS, THE PERFORMANCE OF WHICH  EXTEND  BEYOND  THE
 EFFECTIVE DATE OF WITHDRAWAL, EXCEPT TO THE EXTENT THOSE OBLIGATIONS MAY
 HAVE BEEN RELEASED OR RELINQUISHED BY MUTUAL AGREEMENT OF THE COMMISSION
 AND  THE  WITHDRAWING  STATE.  THE COMMISSION'S APPROVAL OF PRODUCTS AND
 ADVERTISEMENT PRIOR TO THE EFFECTIVE DATE OF WITHDRAWAL  SHALL  CONTINUE
 TO  BE  EFFECTIVE  AND BE GIVEN FULL FORCE AND EFFECT IN THE WITHDRAWING
 STATE, UNLESS FORMALLY RESCINDED BY THE WITHDRAWING STATE  IN  THE  SAME
 MANNER AS PROVIDED BY THE LAWS OF THE WITHDRAWING STATE FOR THE PROSPEC-
 S. 2794                            14
 
 TIVE  DISAPPROVAL OF PRODUCTS OR ADVERTISEMENT PREVIOUSLY APPROVED UNDER
 STATE LAW.
   (6)  REINSTATEMENT  FOLLOWING WITHDRAWAL OF ANY COMPACTING STATE SHALL
 OCCUR UPON THE EFFECTIVE DATE OF  THE  WITHDRAWING  STATE'S  LEGISLATION
 REENACTING THE COMPACT.
   (B)  (1) IF THE COMMISSION DETERMINES THAT ANY COMPACTING STATE HAS AT
 ANY TIME DEFAULTED ("DEFAULTING STATE") IN THE PERFORMANCE OF ANY OF ITS
 OBLIGATIONS OR RESPONSIBILITIES UNDER THIS COMPACT, THE BY-LAWS OR  DULY
 PROMULGATED  RULES OR OPERATING PROCEDURES, THEN, AFTER NOTICE AND HEAR-
 ING AS SET FORTH IN THE BY-LAWS, ALL  RIGHTS,  PRIVILEGES  AND  BENEFITS
 CONFERRED BY THE COMPACT ON THE DEFAULTING STATE SHALL BE SUSPENDED FROM
 THE  EFFECTIVE  DATE  OF DEFAULT AS FIXED BY THE COMMISSION. THE GROUNDS
 FOR DEFAULT INCLUDE, BUT ARE NOT LIMITED TO,  FAILURE  OF  A  COMPACTING
 STATE  TO  PERFORM  ITS  OBLIGATIONS  OR RESPONSIBILITIES, AND ANY OTHER
 GROUNDS DESIGNATED IN COMMISSION RULES. THE COMMISSION SHALL IMMEDIATELY
 NOTIFY THE DEFAULTING STATE IN WRITING OF THE DEFAULTING STATE'S SUSPEN-
 SION PENDING A CURE OF THE DEFAULT. THE COMMISSION SHALL  STIPULATE  THE
 CONDITIONS  AND  THE  TIME PERIOD WITHIN WHICH THE DEFAULTING STATE MUST
 CURE ITS DEFAULT. IF THE DEFAULTING STATE  FAILS  TO  CURE  THE  DEFAULT
 WITHIN THE TIME PERIOD SPECIFIED BY THE COMMISSION, THE DEFAULTING STATE
 SHALL  BE  TERMINATED  FROM  THE  COMPACT AND ALL RIGHTS, PRIVILEGES AND
 BENEFITS CONFERRED BY THE COMPACT SHALL BE TERMINATED FROM THE EFFECTIVE
 DATE OF TERMINATION.
   (2) PRODUCT APPROVALS BY THE  COMMISSION  OR  PRODUCT  SELF-CERTIFICA-
 TIONS, OR ANY ADVERTISEMENT IN CONNECTION WITH SUCH PRODUCT, THAT ARE IN
 FORCE  ON THE EFFECTIVE DATE OF TERMINATION SHALL REMAIN IN FORCE IN THE
 DEFAULTING STATE IN THE SAME MANNER AS IF THE DEFAULTING STATE HAD WITH-
 DRAWN VOLUNTARILY UNDER THIS SECTION.
   (3)  REINSTATEMENT  FOLLOWING  TERMINATION  OF  ANY  COMPACTING  STATE
 REQUIRES A REENACTMENT OF THE COMPACT BY THAT STATE.
   (C)(1) THE COMPACT DISSOLVES EFFECTIVE UPON THE DATE OF THE WITHDRAWAL
 OR  DEFAULT  OF  THE  COMPACTING  STATE  WHICH REDUCES MEMBERSHIP IN THE
 COMPACT TO ONE COMPACTING STATE.
   (2) UPON THE DISSOLUTION OF THE COMPACT, THE COMPACT BECOMES NULL  AND
 VOID  AND  SHALL  BE OF NO FURTHER FORCE OR EFFECT, AND THE BUSINESS AND
 AFFAIRS OF THE COMMISSION SHALL BE WOUND UP AND ANY SURPLUS FUNDS  SHALL
 BE DISTRIBUTED IN ACCORDANCE WITH THE BY-LAWS.
   §  8216.  SEVERABILITY  AND  CONSTRUCTION.  (A)  THE PROVISIONS OF THE
 COMPACT SHALL BE SEVERABLE; AND  IF  ANY  PHRASE,  CLAUSE,  SENTENCE  OR
 PROVISION  IS  DEEMED  UNENFORCEABLE,  THE  REMAINING  PROVISIONS OF THE
 COMPACT SHALL BE ENFORCEABLE.
   (B) THE PROVISIONS OF THE COMPACT  SHALL  BE  LIBERALLY  CONSTRUED  TO
 EFFECTUATE ITS PURPOSES.
   §  8217. BINDING EFFECT OF COMPACT AND OTHER LAWS. (A) NOTHING IN THIS
 SECTION PREVENTS THE ENFORCEMENT OF ANY OTHER LAW OF A COMPACTING STATE,
 EXCEPT AS PROVIDED IN SUBSECTION (B) OF THIS SECTION.
   (B) FOR ANY PRODUCT APPROVED  OR  CERTIFIED  TO  THE  COMMISSION,  THE
 RULES,  UNIFORM  STANDARDS  AND ANY OTHER REQUIREMENTS OF THE COMMISSION
 SHALL CONSTITUTE THE EXCLUSIVE PROVISIONS  APPLICABLE  TO  THE  CONTENT,
 APPROVAL  AND  CERTIFICATION OF SUCH PRODUCTS. FOR ADVERTISEMENT THAT IS
 SUBJECT TO THE COMMISSION'S AUTHORITY, ANY  RULE,  UNIFORM  STANDARD  OR
 OTHER  REQUIREMENT  OF  THE  COMMISSION WHICH GOVERNS THE CONTENT OF THE
 ADVERTISEMENT SHALL CONSTITUTE THE EXCLUSIVE PROVISION  THAT  A  COMMIS-
 SIONER  MAY  APPLY  TO THE CONTENT OF THE ADVERTISEMENT. NOTWITHSTANDING
 THE FOREGOING, NO ACTION TAKEN  BY  THE  COMMISSION  SHALL  ABROGATE  OR
 RESTRICT:
 S. 2794                            15
 
   (1) THE ACCESS OF ANY PERSON TO STATE COURTS;
   (2)  REMEDIES AVAILABLE UNDER STATE LAW RELATED TO BREACH OF CONTRACT,
 TORT OR OTHER LAWS NOT SPECIFICALLY DIRECTED TO THE CONTENT OF THE PROD-
 UCT;
   (3) STATE LAW RELATING TO THE CONSTRUCTION OF INSURANCE CONTRACTS; OR
   (4) THE AUTHORITY OF THE ATTORNEY GENERAL OF THE STATE INCLUDING,  BUT
 NOT  LIMITED TO, MAINTAINING ANY ACTIONS OR PROCEEDINGS AS AUTHORIZED BY
 LAW.
   (C) ALL INSURANCE PRODUCTS  FILED  WITH  INDIVIDUAL  STATES  SHALL  BE
 SUBJECT TO THE LAWS OF THOSE STATES.
   (D)  ALL  LAWFUL  ACTIONS  OF  THE COMMISSION, INCLUDING ALL RULES AND
 OPERATING PROCEDURES PROMULGATED BY THE COMMISSION, ARE BINDING UPON THE
 COMPACTING STATES.
   (E) ALL AGREEMENTS BETWEEN THE COMMISSION AND  THE  COMPACTING  STATES
 ARE BINDING IN ACCORDANCE WITH THEIR TERMS.
   (F)  UPON  THE  REQUEST  OF  A PARTY TO A CONFLICT OVER THE MEANING OR
 INTERPRETATION OF COMMISSION ACTIONS, AND UPON A MAJORITY  VOTE  OF  THE
 COMPACTING  STATES, THE COMMISSION MAY ISSUE ADVISORY OPINIONS REGARDING
 THE DISPUTED MEANING OR INTERPRETATION.
   (G) IN THE EVENT ANY PROVISION OF THIS ARTICLE EXCEEDS  THE  CONSTITU-
 TIONAL  LIMITS  IMPOSED  ON THE LEGISLATURE OF ANY COMPACTING STATE, THE
 OBLIGATIONS, DUTIES, POWERS OR JURISDICTION SOUGHT TO  BE  CONFERRED  BY
 THAT  PROVISION  UPON  THE  COMMISSION  SHALL  BE INEFFECTIVE AS TO SUCH
 COMPACTING STATE, AND SUCH OBLIGATIONS, DUTIES, POWERS  OR  JURISDICTION
 SHALL REMAIN IN THE COMPACTING STATE AND SHALL BE EXERCISED BY THE AGEN-
 CY THEREOF TO WHICH SUCH OBLIGATIONS, DUTIES, POWERS OR JURISDICTION ARE
 DELEGATED BY LAW IN EFFECT AT THE TIME THE COMPACT BECOMES EFFECTIVE.
   §  8218. EXEMPT PRODUCTS. IN ACCORDANCE WITH THE PROVISIONS OF SECTION
 EIGHTY-TWO HUNDRED FOUR OF THE INTERSTATE INSURANCE  PRODUCT  REGULATION
 COMPACT,  THE STATE OF NEW YORK OPTS OUT OF ALL EXISTING AND PROSPECTIVE
 UNIFORM STANDARDS INVOLVING LONG-TERM CARE INSURANCE  PRODUCTS  AND  ALL
 EXISTING  UNIFORM STANDARDS, INCLUDING ANY AMENDMENTS THERETO, INVOLVING
 ANNUITY PRODUCTS OR DISABILITY INCOME INSURANCE  PRODUCTS  IN  ORDER  TO
 PRESERVE  THE  STATE'S  STATUTORY REQUIREMENTS GOVERNING THESE INSURANCE
 PRODUCTS. THE DEPARTMENT OF FINANCIAL SERVICES IS AUTHORIZED  AND  SHALL
 BY  AUTHORITY HEREIN PROMULGATE REGULATIONS TO OPT OUT OF FUTURE UNIFORM
 STANDARDS INVOLVING ANNUITY  PRODUCTS  OR  DISABILITY  INCOME  INSURANCE
 PRODUCTS.
   § 3. This act shall take effect on the one hundred eightieth day after
 it shall have become a law.