Mo. Code Regs. tit. 20 § 100-8.040

Current through Register Vol. 45, No. 19, October 1, 2020
Section 20 CSR 100-8.040 - Insurer Record Retention

PURPOSE: This amendment clarifies standards for maintaining insurance records in compliance with Missouri law.

PURPOSE: This rule describes the requirements for record keeping for insurers and related entities doing business in this state. This regulation was adopted pursuant to the provisions of section 374.045, RSMo and to implement sections 287.350, 354.190, 354.465, 374.190, 374.210, 375.158, 374.205, 379.343, and 379.475, RSMo and 144.027, 354.149, 354.717, 375.022, 375.150, 375.151, 375.926, 375.932, 375.938, 375.1002, and 375.1009, RSMo.

(1) As used in this rule, the terms and phrases mean as follows:
(A) "Application," any written or electronic application form, any enrollment form, any document used to add coverage under any existing policy, any questionnaire, telephone interview form, paramedical interview form, or any other document used to question or underwrite an applicant for any policy issued by an insurer or for any declination of coverage by an insurer. "Application" does not include documents, questionnaires or notes generated in response to a request for a premium quote which did not result in an application for coverage;
(B) "Business entity," as that term is defined in section 375.012.1(1), RSMo;
(C) "Claim," as that term is defined in section 20 CSR 100-1.010(1)(B);
(D) "Examiner," a market conduct examiner authorized by the director to conduct an examination pursuant to section 374.202.2(4), RSMo;
(E) "Inquiry," a specific question, criticism or request made in writing to an insurer by a market conduct examiner duly appointed by the director;
(F) "Insurer," as that term is defined in section 375.932 or 375.1002, RSMo; and
(G) "Policy," as that term is defined in section 375.932(5), RSMo.

The term "policy" also includes any evidence of coverage issued by a health maintenance organization to an enrollee.

(2) Records Maintainance. Every insurer transacting business in this state shall maintain its books, records, documents, and other business records in a manner so that the following practices of the insurer may be readily ascertained during market conduct examinations: claims handling and payment, complaint handling, termination, rating, underwriting and marketing. Nothing in this regulation requires an insurer to create records that never existed; however, the division may request the creation of such records if it believes doing so will reduce examination costs.
(3) Records to be Maintained. An insurer that maintains its records in accordance with the following standards will be considered in compliance with Missouri law.
(A) A Missouri policy record file for each Missouri policy issued shall be maintained for the duration of the current policy term plus two (2) calendar years. Missouri policy records shall be maintained so as to show clearly the policy period, basis for rating and any imposition of additional exclusions from or exceptions to coverage. Missouri policy records need not be segregated from the policy records of other states so long as they are readily available to Missouri market conduct examiners as set forth under this rule. Missouri policy records shall include the following:
1. The actual, completed application for each contract.
A. The application shall bear the signature of the applicant whenever the insurer intends to retain any right to contest any warranty, representation or condition contained in the application.
B. The application shall bear a clearly legible means by which an examiner can identify any insurance producer involved in the transaction. The examiners shall be provided with any information needed to determine the identity of said insurance producer;
2. Any declaration pages (the initial page and any subsequent pages), the insurance contract, any certificates evidencing coverage under a group contract, any endorsements or riders associated with a policy, and any written or electronic correspondence to or from the insured pertaining to the coverage. If any of these records has already been filed with the department, a separate copy of the record need not be maintained in the individual policy files to which the record pertains, provided it is clear from the insurer's other records or systems that the record applies to a particular policy and that any data contained in the record relating to that policy can be retrieved or recreated;
3. Any binder with terms and conditions that differ from the terms and conditions of the policy subsequently issued; and
4. Any guidelines, manuals or other information necessary for the reconstruction of the rating and underwriting of the policy. The maintenance at the site of a market conduct examination of a single copy of each of the above will be considered satisfactory. If any such rating or underwriting record is computer based, the records used to input the information into the computer system shall also be available to the examiners;
(B) A Missouri claim file shall be maintained for the calendar year in which the claim is closed plus three (3) years. The claim file shall be maintained so as to show clearly the inception, handling, and disposition of each claim. The claim file(s) shall be sufficiently clear and specific so that pertinent events and dates of these events can be reconstructed. A Missouri claim file(s) shall include the following:
1. Any notification of claim, proof of loss, claim form(s), proof of claim payment check/draft, notes, contract, declaration pages, certificates evidencing coverage under a group contract, endorsements or riders, work papers, any written communication, and any documented or recorded telephone communication related to the handling of a claim, including the investigation, payment and/or denial of the claim, and any claim manual(s) or other information necessary for reviewing the claim. Where a particular document pertains to more than one (1) file, insurers may satisfy the requirements of this paragraph by making available, at the site of a market conduct examination, a single copy of each document;
2. Documents in a claim file received from an insured, the insured's insurance producer, a claimant, the department or any other insurer shall bear the initial date of receipt date-stamped by the insurer in a legible form in ink or some other permanent manner. Unless the company provides the examiners with written procedures to the contrary, the earliest date stamped on a document will be considered the initial date of receipt;
3. In cases of a total loss on property claims for a motor vehicle, trailer, boat or outboard motor, where the insurer utilizes the credit procedure contained in section 144.027, RSMo, for reimbursement of sales tax, the claim file shall contain a copy of the certification described in section 144.027, RSMo, attesting to the amount of the insurance proceeds and any deductible obligation paid by the claimant regarding the loss; and
4. If an insurer, as its regular business practice, places the responsibility for handling certain types of claims upon company personnel other than its claims personnel, the insurer need not duplicate its files for maintenance by claims personnel. These claims records must be maintained as part of the records of the insurer's operations and must be readily available to examiners.

Notwithstanding the definition of "claim" at subsection 20 CSR 100-1.010(1)(B), the time standards for the retention of records for policy files stated at section 374.205.2(2), RSMo, apply to claims handled by the company's personnel who typically handle policy files;

(C) Records to be maintained relating to the insurer's compliance with Missouri's licensing requirements shall include the Missouri licensing records of each insurance producer associated with the insurer. Licensing records shall be maintained so as to show clearly the dates of the appointment and terminations of each insurance producer. In accordance with the provisions of section 375.158, RSMo, insurers must have procedures in place to request, review, and document current licenses of each insurance producer to whom a commission will be paid or to validate the producer's licensure status prior to the payment of this commission. Upon request by the director, insurers shall provide documentation that such license verification procedures were followed. The date of the receipt by the insurer of the copy of the license shall be indicated by a date-stamp placed on the license. Unless the company provides the examiners with written procedures to the contrary, the earliest date stamped on a document will be considered the initial date of receipt;
(D) The Missouri complaint records maintained pursuant to section 375.936(3), RSMo, shall include the actual written complaints, the insurer's responses and any materials referenced in an insurer's response that are not otherwise maintained by the insurer, along with a complaint log or register that shows clearly the total number of complaints for a period of not less than the immediately preceding three (3) years, the classification of each complaint by line of insurance, the nature of each complaint, the disposition of each complaint, and a reference to the location of the file to which each complaint corresponds. If the insurer maintains the file in a computer format, the reference in the complaint log or register for locating such documentation shall be an identifier such as the policy number or other code, and an identifier key will be provided to the examiners at the time of an examination; and
(E) The insurer shall retain declined underwriting files for a period of three (3) years from the date of declination. The term "declined underwriting file" means all written or electronic records concerning a policy for which an application for insurance coverage has been completed and submitted to the insurer or its insurance producer but the insurer has made a determination not to issue a policy or not to add additional coverage when requested. A declined underwriting file shall include an application, any documentation substantiating the decision to decline an issuance of a policy, any binder issued without the insurer issuing a policy, any documentation substantiating the decision not to add additional coverage when requested, and, if required by law, any declination notification. Notes regarding requests for quotations which do not result in a completed application for coverage need not be maintained for purposes of this regulation.
(4) Form of Record.
(A) Any record to be maintained by an insurer pursuant to Missouri law, may be in the form of paper; photograph; computer; magnetic, mechanical, or electronic medium; or any process which accurately forms a durable reproduction of the record, so long as the record is capable of duplication to a hard copy that is as legible as the original document. Documents necessitating the signature(s) of the insured and/or insurer's insurance producer, shall be maintained in any format as listed above provided evidence of the signature(s) is preserved in that format.
(B) Once a record has been finalized, either for internal or external transmission or for file documentation purposes, or once an electronic record or database is finalized for permanent retention purposes, it shall be maintained in a computer-based format that is archival in nature, so as to preclude any alteration of the record after the initial transfer to archival format. All records shall be maintained according to written procedures developed and adhered to by the insurer. The written procedures shall be made available upon examiner request.
(C) Photographs, microfilms, or other image-processing reproductions of records are deemed the equivalent of the originals and may be certified as the same in actions or proceedings before the department unless inconsistent with 20 CSR 800-1.100.
(5) Location of Files. All records to be maintained by an insurer pursuant to Missouri law shall be kept in a location which will allow the records to be produced for examination within the time period set out under section (6) of this rule. When, under normal circumstances, someone other than the insurer maintains a record or type of record, the other person's or entity's responsibility to maintain the records shall be set forth in a written agreement, with a copy maintained by the insurer and made available to the examiners for purposes of examination.
(6) Time Limits to Provide Records and to Respond to Examiners.
(A) Pursuant to section 374.205.2(2), RSMo, an insurer shall provide any record requested by any examiner within ten (10) calendar days. When the requested record is not or cannot be produced by the insurer within ten (10) calendar days, this nonproduction is deemed a violation of section 374.205.2(2), RSMo, and this rule, unless the insurer can demonstrate to the satisfaction of the director that the requested record cannot reasonably be provided within ten (10) calendar days of the request.
(B) As a means to facilitate the examination and to aid in the examination in accordance with section 374.205.2(2), RSMo, an insurer shall provide a written response to any inquiry submitted by any examiner within ten (10) calendar days. When the requested information is not provided by the insurer within ten (10) calendar days, a violation is deemed to have occurred, unless the insurer can demonstrate to the satisfaction of the director that the requested response cannot reasonably be provided within ten (10) calendar days of the inquiry.
(7) Examination Work Papers. Records provided during a market conduct examination will be returned to the insurer following the examination, unless such records relate to an inquiry made by a department examiner. Records related to an inquiry become a part of the work papers of the examination. Section 374.205, RSMo, and regulation 20 CSR 10-2.400 govern the public access to the work papers of the examination.

20 CSR 100-8.040

AUTHORITY: section 375.948, RSMo 2000 and section 374.045, SB 788, 94th General Assembly, Second Regular Session, 2008.* Original rule filed Nov. 1, 2007, effective July 30, 2008. Emergency amendment filed June 23, 2008, effective July 30, 2008, expired Feb. 26, 2009. Amended: Filed June 23, 2008, effective Jan. 30, 2009.
Amended by Missouri Register October 1, 2019/Volume 44, Number 19, effective 11/30/2019

*Original authority: 374.045, RSMo 1967, amended 1993, 1995, 2008 and 375.948, RSMo 1959, amended 1978, 1991.