S.D. Codified Laws § 58-1-3.4

Current through the 2024 Legislative Session

Section 58-1-3.4 - Health benefit plan-Agricultural organization-Exemption

A health benefit plan is not insurance and is not subject to this title, if:

(1) The plan provides health benefits under a self-funded arrangement, administered by an entity licensed as a third-party administrator in accordance with chapter 58-29D; and

(2) The plan is sponsored by a nonprofit agricultural organization that:

(a) Is domiciled in this state;

(b) Was created primarily to promote programs for the development of rural communities and the economic stability and sustainability of farmers in this state, as shown by its articles of incorporation;

(c) Has been in existence for at least twenty-five continuous years, prior to the issuance of health benefits to members of the organization;

(d) Provides membership opportunities for eligible persons in each county;

(e) Collects annual dues from the members;

(f) Holds regular meetings to further the purposes of the members;

(g) Provides the members with representation on the governing board and committees; and

(h) Contracts with the third-party administrator, referenced in this section, for administration of the health benefit plan.

A health benefit plan described in this section may be sold or solicited only by an insurance producer who is both appointed by an organization meeting the requirements of this section and licensed as an insurance provider to sell or solicit health insurance in accordance with chapter 58-30.

Before providing health benefits under a self-funded plan, as authorized by this section, an organization shall file a certification with the Division of Insurance, at the time and in the manner directed by the division, verifying that the organization meets the requirements of this section.

The risk assumed by a health benefit plan under such health care benefit coverage must be reinsured by a company authorized to do business in this state. The company providing reinsurance coverage to the plan shall annually file, at the time and in the manner directed by the division, any risk distribution arrangements entered into between the plan and the reinsurance carrier and a signed, certified actuarial statement of plan reserves and the existence of reinsurance coverage.

Any health benefit plan application for coverage and any contract provided to a member must prominently state that the health benefit plan is not insurance, that the plan is not provided by an insurance company, that the plan is not subject to the laws and rules governing insurance, and that the plan is not subject to the jurisdiction of the division.

SDCL 58-1-3.4

SL 2021, ch 208, §1.