Current through Reg. 50, No. 13; March 28, 2025
At least every two years, the State Board of Insurance
will conduct an evaluation of the loss control information/services of each
insurer writing professional liability insurance for insureds other than
hospitals, of each insurer writing general liability insurance, and of each
insurer writing medical professional liability insurance for insureds other
than hospitals in Texas.
(1) Location
of evaluations. Evaluations will be conducted in Texas at a company home
office, division office, regional office, or office closest to Austin, or as
otherwise arranged through mutual consent between a representative of the
director of loss control regulation for the State Board of Insurance and a
representative of the insurer. Companies out of state with no office in Texas
will be required to bring necessary files to Austin. The insurer shall bring
all account files selected by the director of loss control regulation from all
Texas company offices or operating locations to the selected evaluation
location. All affiliated companies of an insurer shall be evaluated at the same
time and location.
(2) Notification
and preparation. Notification and preparation for evaluations shall occur in
accordance with subparagraphs (A)-(F) of this paragraph.
(A) Notice of date of evaluation. The
director of loss control regulation will notify each company of the proposed
date of the company's evaluation a minimum of 60 days in advance of the
evaluation.
(B) List of
policyholder accounts. At least 45 days prior to the date set for the
evaluation, the company must provide the director of loss control regulation
with a list of policyholder accounts, by premium grouping and location. The
list shall be separated by affiliated insurance company, including the name and
policy number of each policyholder, and arranged in order of descending
premium.
(C) Notice of accounts to
be evaluated. Upon receipt of this list, the director of loss control
regulation will select those accounts to be evaluated, notify the company, and
specify each account for which an evaluation worksheet must be prepared by the
company. Worksheet forms will be provided to the company at the time the
accounts to be evaluated are identified.
(D) Information required. The company will
have at least 30 days from the time the accounts are selected to complete the
worksheets. Information on the worksheet may include, but is not limited to,
the following:
(i) account identification and
location;
(ii) estimated annual
premium;
(iii) description of
operations;
(iv) date of last loss
prevention visit, or direct communication (if any);
(vi) loss potential of risk;
(vii) information submitted to policyholders
for loss control purposes;
(viii)
extent and type of services provided;
(ix) number of employees;
(xi) effective date of policy; and
(xii) other information as deemed necessary
by the director of loss control regulation.
(E) Delivery of information to the board.
Five working days prior to the scheduled inspection, the insurer shall deliver
the completed worksheets to the Loss Control Regulation Division, State Board
of Insurance. Information from account files and other appropriate information
and documents shall be made available to the inspectors during the
evaluation.
(F) Possible visit by
inspector. If considered necessary, the inspector may visit a policyholder to
make further evaluation of the loss control information and services provided.
If requested by the inspector, a representative of the insurer shall make the
necessary notifications and arrangements and shall be afforded the opportunity
to accompany the inspector. If the director of loss control regulation for the
State Board of Insurance considers it appropriate, the inspector will make the
visit without notifying the insurer.
(3) Conduct of the evaluation. The inspector
will work with a responsible member of insurance company management or a
designated representative in the evaluation of the adequacy of the loss control
information and services provided to policyholders. The evaluation will be
conducted in two parts. Part one will consist of the review and analysis of
company records and a determination of how loss control information and
services are made available to policyholders. Part two will consist of an exit
briefing on the preliminary results of the evaluation. A written report will be
provided in accordance with paragraph (5) of this section.
(4) Records and procedures to be reviewed.
Records and procedures which the company must make available for review and
evaluation are listed in subparagraphs (A)-(E) of this paragraph.
(A) Loss control personnel qualifications.
The insurer shall make available, at the beginning of the evaluation, a list of
personnel performing the duties of providing loss information and services. The
list will include the name, office location, designation as employee or
contractor, and statement of qualifications pursuant to §
5.1731 of this title (relating to
Qualifications of Personnel Providing Loss Control Information and Services).
The inspector will review qualifications of all personnel performing the duties
of providing loss control information and services.
(B) Availability of information and services.
The company shall make available examples of procedures by which policyholders
are informed of the availability of loss control information/services. Also to
be reviewed are the procedures followed by the company regarding requests by
the insured for loss control information and services.
(C) Loss control information and services.
The inspector will review the mechanisms and procedures by which the
appropriate loss control information and service is determined under the
guidelines outlined in §
5.1721 of this title (relating to
Loss Control Information). The company shall maintain a record by policyholder
of all loss control information and services rendered.
(D) Worksheets and policyholder files. A
detailed review of completed worksheets and information from selected
policyholder files will be made to ascertain the adequacy and quality of loss
control information and services.
(E) Other data. The inspector may review
other data or information in the course of the evaluation of the adequacy of
loss control information and services. Such information may include, but is not
limited to, liability loss/claims notification procedures, liability loss
investigation and analysis, examples of cost savings for policyholders as a
result of liability loss practices, and follow up efforts on recommendations
made to policyholders.
(5) Loss control reports. Upon completion of
the inspection, the inspector will prepare a written report to be provided to
upper level management of the insurance company. The report will reflect the
inspector's observations, conclusions, and analysis of the adequacy of the
company's loss control information and services as required by the Insurance
Code, Article 5.15-3. When appropriate, recommendations for improvement will be
a part of the report.
