SECTION 3.7. Form Acceptance and Procedures

(a) Acceptance or rejection.

(1) A filing received by the department which is in compliance with the requirements of this subchapter and §7.1302 of this title (relating to Billing System) will be accepted and processed according to subsection (b) of this section.

(2) A filing received by the department which fails to comply with this subchapter and §7.1302 of this title will be rejected and returned to the company with a letter or electronic notification indicating the reason(s) for the rejection.

(b) Accepted filings.

(1) Review period for filings subject to approval. Filings subject to approval will be reviewed for compliance with the Insurance Code, this title, or any other applicable law of this state or the United States. Such filings, after review, will be affirmatively approved or disapproved within the applicable statutory deemer period, unless the department initiates a request for correction as set forth in subsection (c) of this section.

(2) Date for exempt filings. Filings submitted pursuant to Subchapter Z of this chapter (relating to Exemption from Review and Approval of Certain Life, Accident, Health, and Annuity Forms and Expedition of Review) are considered exempt as of the date received by the department; however, such filings are subject to audit as specified in §3.4008 of this title (relating to Procedures for Corrections to Non-Compliant Exempt Forms).

(3) Date for informational filings. Informational filings are considered filed as of the date received by the department.

(c) Request for correction.

(1) In lieu of issuing a disapproval of a filing, the department may request corrections be made to a form which contains compliance deficiencies provided that at the time of initial notification of any deficiencies, the company either:

(A) requests a 45-day extension of the review period for purposes of bringing the submission into compliance; or

(B) provides a waiver of the company's right to deem the filing approved.

(2) If the company fails to comply with paragraph (1) of this subsection, a disapproval letter or electronic notification will be sent by the department.

(3) The department may notify a company of a request for corrections by telephone, facsimile transmission, or by written or electronic request.

(4) If a company fails to submit corrections to the department within 30 days after notification of any deficiencies and request for corrections, the department will consider the form withdrawn from review by the company. The department will not give any withdrawn form consideration until the company resubmits the form as a new filing.

(5) If the department finds a form violates or does not comply with the insurance or administrative code and requests corrections, the department may request or, after notice and opportunity for hearing, order that the company either replace any previously used, issued, or delivered form with a corrected form, correct the form by rider, or discontinue using the form.

(d) Disapproval of a form.

(1) The department may disapprove any form if:

(A) the form fails to comply with any applicable statutes or regulations of this state or the United States;

(B) the content of the form is unjust, encourages misrepresentation, or is in any way deceptive; or

(C) the form is a group filing that has been submitted and accepted for review under a group type that is ineligible under the provisions of Insurance Code Chapter 1131 and Chapter 1251 and §21.2702(1) and (2) of this title (relating to Definitions).

(2) When the department disapproves a form pursuant to paragraph (1) of this subsection, the department may request that the company replace any form previously used, issued, or delivered, with a corrected form, or correct the form by rider. The department may also request that the company discontinue using the form if, prior to receiving approval from the department, any form has been used, issued, or delivered.

(e) Withdrawal of approval.

(1) The department may notify any company, by telephone, facsimile transmission, or by written or electronic request, of compliance deficiencies in a previously approved or exempted form. The department may accompany such notice with a request that the company either replace any previously used, issued, or delivered form with a corrected form, correct the form by rider, or discontinue using the form.

(2) The department may, after notice and opportunity for hearing, withdraw previous approval of forms pursuant to Insurance Code §§1701.055(a), 1701.055(d), or 1701.057(a).

(3) When the department withdraws approval of a form pursuant to paragraphs of this subsection and the company has previously used, issued, or delivered the form in this state, the department may direct that the company either replace any previously used, issued, or delivered form with a corrected form, correct the form by rider, or discontinue using the form.

(f) Departmental notice of action. The department will send written or electronic notification, when the processing of the filing has been completed, of any actions taken by the department including, but not limited to, approval, disapproval, withdrawal, or exemption of any filing under this subchapter.

(1) Notices of approval will be in the form of a letter or electronic notification stating the form number, if applicable, and the effective date of the approval.

(2) Notices of disapproval will be in the form of a letter or electronic notification stating the form number, if applicable, the effective date of the disapproval, and the compliance deficiencies.

(3) Notices of acceptance for exemption, substitution, and filing for information will be in the form of a letter or electronic notification stating the form number, if applicable, and the date of acceptance of such filing.

(4) Notice of other actions including, but not limited to, audits, deficiencies, noncompliance, and withdrawals will be in the form of a letter or electronic notification stating the form number and any deficiencies, if applicable.

(5) Notices of disapproval that result from a filing being submitted under an ineligible group type as described in subsection (d)(1)(C) of this section will be in the form of a letter or electronic notification stating the form number, if applicable, the effective date of the decision, and that the disapproval resulted from the filing of an ineligible group type. A comprehensive review of the text of the form will not be completed for forms filed for use with ineligible group types.

(6) Companies must retain the written notification or a copy of the electronic notification as documentation of the department's action on a form.

(7) The department will maintain copies of the filing and the notice of departmental action and such will be the official record.

Source Note: The provisions of this §3.7 adopted to be effective June 1, 2003, 28 TexReg 3954; amended to be effective May 11, 2022, 47 TexReg 2758