31 Pa. Code § 147.2 - Definitions

Current through Register Vol. 52, No. 16, April 16, 2022

The following words and terms, when used in this chapter, have the following meanings, unless the context clearly indicates otherwise:

Affiliate-As defined in section 1401 of The Insurance Company Law of 1921 (40 P.S. § 991.1401).

Assumed premiums-Total premiums assumed by an insurer from nonaffiliated insurers.

Audit committee-

(i) A committee or equivalent body established by the board of directors or equivalent body of an entity for the purpose of overseeing the following functions of an insurer or insurer group:

(A) Accounting and financial reporting processes.

(B) Internal audit function.

(C) External audits of financial statements.

(D) Internal control structure.

(ii) The term includes a committee established under section 1405(c)(4) or (5) of The Insurance Company Law of 1921 (40 P.S. § 991.1405(c)(4) and (5)).

Audited financial report-The term includes those items specified in § 147.4 (relating to contents of annual audited financial report).

Commissioner-The Insurance Commissioner of the Commonwealth.

Control, controlling, controlled by and under common control with-As defined in section 1401 of The Insurance Company Law of 1921.

Department-The Insurance Department of the Commonwealth.

Direct written premiums-Total premiums directly written by an insurer.

Domestic insurer-An insurer incorporated or organized under the laws of the Commonwealth.

Foreign insurer-An insurer not incorporated or organized under the laws of the Commonwealth.

Independent certified public accountant-

(i) A certified public accountant licensed, or an accounting firm registered, to practice in this Commonwealth under The CPA Law (63 P. S. § § 9.1-9.16b) or in another state with similar licensing requirements, in good standing with the American Institute of Certified Public Accountants, Inc., and in good standing in the states in which the certified public accountant is licensed or the accounting firm is registered to practice; who conforms to the standards of the profession as contained in the "Code of Professional Ethics of the American Institute of Certified Public Accountants, Inc." and The CPA Law or similar laws.
(ii) For insurers organized in Canada or the United Kingdom of Great Britain and Northern Ireland, a chartered accountant.

Insurer-

(i) The term includes any of the following licensed to transact business in this Commonwealth:
(A) An insurance company, association or exchange.
(B) A reciprocal or interinsurance exchange.
(C) The Inspection Bureau, the Industry Placement Facility and the Fair Plan coming under the Pennsylvania Fair Plan Act (40 P. S. § § 1600.101-1600.502).
(D) A nonprofit health plan corporation, whether operating a hospital plan or a professional health services plan, or both.
(E) An employers' mutual liability insurance association.
(F) A health maintenance organization.
(G) A fraternal benefit society or beneficial association.
(H) A preferred provider organization.
(I) A joint underwriting association under section 731 of the Medical Care Availability and Reduction of Error (MCARE) Act (40 P. S. § 1303.731).
(ii) Except as otherwise noted, the term also includes a continuing care provider licensed to transact business in this Commonwealth under the Continuing Care Provider Registration and Disclosure Act (40 P. S. § § 3201-3255)).

Insurer group-Two or more affiliated insurers identified by a controlling entity for the purpose of evaluating the effectiveness of internal control over financial reporting.

Internal audit function-The role of a person or persons in providing independent, objective and reasonable assurances that add value to and improve upon the organization's operations and assist the organization in accomplishing its objectives by employing a systematic, disciplined approach to evaluate and improve the effectiveness of the risk management, control and governance processes.

Internal control over financial reporting-The process effected by the board of directors, management and other personnel of an insurer or insurer group, which provides reasonable assurances regarding the reliability of the financial statements in accordance with § 147.9a (relating to establishment and communication of internal control over financial reporting).

NAIC-The National Association of Insurance Commissioners or successor organization.

NAIC Implementation Guide-The "Implementation Guide for the Annual Financial Reporting Model Regulation" published in the NAIC Accounting Practices and Procedures Manual, or successor publication, prescribed for financial reporting under section 320(a)(2) of The Insurance Company law of 1921 (40 P. S. § 443(a)(2)).

Person-As defined in section 1401 of The Insurance Company Law of 1921.

Sarbanes-Oxley Act-The Sarbanes-Oxley Act of 2002, also known as the Public Company Accounting Reform and Investor Protection Act of 2002 ( 15 U.S.C.A. § § 7201 - 7266 ).

Sarbanes-Oxley Act compliant entity-An entity that is either required to be or is voluntarily compliant with the following:

(i) The preapproval requirements of section 201 of the Sarbanes-Oxley Act ( 15 U.S.C.A. § 78j-1 ).
(ii) The audit committee independence requirements of section 301 of the Sarbanes-Oxley Act ( 15 U.S.C.A. § 78f ).
(iii) The internal control over financial reporting requirements of section 404 of the Sarbanes-Oxley Act ( 15 U.S.C.A. § 7262 ) and 17 CFR 229.308.

Section 404 Report-The annual report on internal control over financial reporting and the related attestation report of the independent certified public accountant filed under section 404 of the Sarbanes-Oxley Act ( 15 U.S.C.A. § 7262 ) and 17 CFR 229.308 (relating to Item 308 internal control over financial reporting).

Securities Exchange Act-The Securities Exchange Act of 1934 ( 15 U.S.C.A. § § 78a - 78mm ).

Ultimate controlling person-A person which is not controlled by another person. The term may include one or more of the following: individual, corporation, limited liability company, partnership, association, joint stock company, trust, unincorporated organization, or any similar entity or combination of the foregoing who controls another person.

Notes

31 Pa. Code § 147.2
Amended by Pennsylvania Bulletin, Vol 46, No. 51. December 17, 2016, effective 1/17/2017

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