Pennsylvania Statutes Title 40 P.S. Insurance § 991.1401. Definitions

Welcome to FindLaw's Cases & Codes, a free source of state and federal court opinions, state laws, and the United States Code. For more information about the legal concepts addressed by these cases and statutes, visit FindLaw's Learn About the Law.

As used in this article, and for the purposes of this article only, the following words and phrases shall have the meanings given to them in this section:

“Affiliate.”  A person that directly or indirectly through one or more intermediaries controls or is controlled by, or is under common control with, the person specified.

“Commissioner.”  The Insurance Commissioner of the Commonwealth.

“Company action level event.”  As defined in section 501-A or 501-B of the act of May 17, 1921 (P.L. 789, No. 285),  1 known as “The Insurance Department Act of 1921.”

“Control,” “controlling,” “controlled by” and “under common control with.”  The possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a commercial contract for goods or nonmanagement services or otherwise, unless the power is the result of an official position with or corporate office held by the person.  Control shall be presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote or holds proxies representing ten per centum (10%) or more of the votes that all shareholders would be entitled to cast in the election of directors.  This presumption may be rebutted by a showing that control does not exist in fact.  The Insurance Department may determine, after furnishing all persons in interest notice and opportunity to be heard and making specific findings of fact to support such determination, that control exists in fact, notwithstanding the absence of a presumption to that effect or that another person has control.

“Department.”  The Insurance Department of the Commonwealth.

“Enterprise risk.”  An activity, circumstance, event or series of events involving one or more affiliates of an insurer that, if not remedied promptly, would likely have a material adverse effect on the financial condition or liquidity of an insurer or its insurance holding company system, including, but not limited to, anything that would:

(1) trigger a company action level event for the insurer;  or

(2) cause the insurer to be deemed to be in hazardous financial condition under:

(i) Article V of the act of May 17, 1921 (P.L. 789, No. 285),  2 known as “The Insurance Department Act of 1921.”

(ii) 31 Pa. Code Ch. 160 (relating to standards to define insurers deemed to be in hazardous financial condition).

“IAIS.”  The International Association of Insurance Supervisors or successor organization.

“Insurance holding company system.”  Two or more affiliated persons, one or more of which is an insurer.

“Insurer.”  Any health maintenance organization, preferred provider organization, company, association, exchange, hospital plan corporation as defined in and subject to 40 Pa.C.S. Ch. 61 (relating to hospital plan corporations) or professional health services plan corporation subject to 40 Pa.C.S. Ch. 63 (relating to professional health services plan corporations), authorized by the Insurance Commissioner to transact the business of insurance in this Commonwealth except that the term shall not include:

(1) the Commonwealth or any agency or instrumentality thereof;

(2) agencies, authorities or instrumentalities of the United States, its possessions and territories, the Commonwealth of Puerto Rico, the District of Columbia or a state or political subdivision;  or

(3) fraternal benefit societies.

“NAIC.”  The National Association of Insurance Commissioners or successor organization.

“Person.”  An individual, an insurer, a corporation, a partnership, a limited liability company, an association, a joint stock company, a trust, an unincorporated organization, any similar entity or any combination of the foregoing acting in concert.  The term shall not include any joint venture partnership exclusively engaged in owning, managing, leasing or developing real or tangible personal property.

“SEC.”  The Securities and Exchange Commission of the United States.

“Security holder.”  One who owns any security of a specified person, including common stock, preferred stock, debt obligations and any other security convertible into or evidencing the right to acquire any of the foregoing.

“Shareholder.”  A record holder or record owner of shares of an insurer.

(1) The term shall include all of the following:

(i) A member of an insurer that is a domestic nonstock corporation under 15 Pa.C.S. Ch. 21 (relating to nonstock corporations) or a prior statute.

(ii) A member, as defined in 15 Pa.C.S. § 5103 (relating to definitions), of an insurer that is a domestic nonprofit corporation under 15 Pa.C.S. Ch. 51 (relating to general provisions) or a prior statute.

(iii) A subscriber of an insurer that is a domestic reciprocal exchange under Article X   3 or a prior statute.

(2) The term shall not include any subscriber, insured or customer of:

(i) a hospital plan corporation subject to 40 Pa.C.S. Ch. 61 (relating to hospital plan corporations);  or

(ii) a professional health services plan corporation subject to 40 Pa.C.S. Ch. 63 (relating to professional health services plan corporations).

“Subsidiary.”  An affiliate of a specified person controlled by another person directly or indirectly through one or more intermediaries.

“Voting security.”  Includes any security convertible into or evidencing a right to acquire a voting security.

1 40 P.S. §§ 221.1-A, 221.1-B.
2 40 P.S. § 221.1 et seq.
3 40 P.S. § 961 et seq.

Cite this article: FindLaw.com - Pennsylvania Statutes Title 40 P.S. Insurance § 991.1401. Definitions - last updated January 01, 2019 | https://codes.findlaw.com/pa/title-40-ps-insurance/pa-st-sect-40-991-1401.html


FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature or via Westlaw before relying on it for your legal needs.

Copied to clipboard