SENATORS Nein, Hottinger, Padgett, Robert Gardner, Mumper, Roberts, Zurz

To amend sections 1739.02, 1739.99, 1751.02, 1751.28,

1

3901.78, 3905.14, 3917.01, and 3999.99 and to

2

enact sections 1739.27 and 3999.18 of the Revised

3

Code to change the assets that are considered to

4

be admitted assets for purposes of meeting the

5

statutory minimum for health insuring

6

corporations, to provide an option for group life

7

insurance coverage for certain members of a

8

workforce, to provide for criminal and financial

9

penalties for persons establishing or operating

10

unlicensed health care insurers and criminal and

11

administrative penalties for agents selling

12

policies of unlicensed insurers, and to amend

13

provisions governing the issuance of certificates

14

of compliance to insurers.

15

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 1739.02, 1739.99, 1751.02, 1751.28,	16
3901.78, 3905.14, 3917.01, and 3999.99 be amended and sections	17
1739.27 and 3999.18 of the Revised Code be enacted to read as	18
follows:	19

Sec. 1739.02.  (A) A trade association, industry association,	20
or professional association that has been organized and maintained	21
in good faith for a continuous period of one year or more for	22
purposes other than obtaining insurance may establish, maintain,	23
or operate a group self-insurance program under a multiple	24
employer welfare arrangement that is chartered and created in this	25
state under sections 1739.01 to 1739.22 of the Revised Code.	26

(B) Except as provided in section 9.833 and sections 1739.01	27
to 1739.22 of the Revised Code, no multiple employer welfare	28
arrangement or other entity by which two or more employers jointly	29
participate in a common employee welfare benefit plan shall	30
operate a group self-insurance program in this state after four	31
months after the effective date of this section.	32

(C) Sections 1739.01 to 1739.22 of the Revised Code do not	33
apply to any entity that establishes, maintains, or operates a	34
fully-insured program.	35

(D) No person shall establish, operate, or maintain a	36
multiple employer welfare arrangement providing benefits through a	37
group self-insurance program in this state unless the multiple	38
employer welfare arrangement has a valid certificate of authority	39
from the superintendent of insurance.	40

Sec. 1739.27.  No insurance agent, broker, or other person	41
shall advertise, solicit, negotiate, collect a premium on, or sell	42
any enrollment in, a group self-insurance program in this state,	43
unless the multiple employer welfare arrangement has a valid	44
certificate of authority from the superintendent of insurance.	45

Sec. 1739.99. (A) Whoever violates division (B) of section	46
1739.02 of the Revised Code is guilty of a felony of the fourth	47
degree.	48

(B) Whoever violates division (D) of section 1739.02 of the	49
Revised Code is guilty of a felony of the fourth degree.	50

(C) Whoever violates section 1739.27 of the Revised Code is	51
guilty of a misdemeanor of the first degree on a first offense and	52
a felony of the fifth degree on each subsequent offense.	53

(D) If a person is found guilty under this section, the court	54
may award restitution in accordance with section 2929.18 of the	55
Revised Code.	56

Sec. 1751.02.  (A) Notwithstanding any law in this state to	57
the contrary, any corporation, as defined in section 1751.01 of	58
the Revised Code, may apply to the superintendent of insurance for	59
a certificate of authority to establish and operate a health	60
insuring corporation. If the corporation applying for a	61
certificate of authority is a foreign corporation domiciled in a	62
state without laws similar to those of this chapter, the	63
corporation must form a domestic corporation to apply for, obtain,	64
and maintain a certificate of authority under this chapter.	65

(B) No person shall establish, operate, or perform the	66
services of a health insuring corporation in this state without	67
obtaining a certificate of authority under this chapter.	68

(C) Except as provided by division (D) of this section, no	69
political subdivision or department, office, or institution of	70
this state, or corporation formed by or on behalf of any political	71
subdivision or department, office, or institution of this state,	72
shall establish, operate, or perform the services of a health	73
insuring corporation. Nothing in this section shall be construed	74
to preclude a board of county commissioners, a county board of	75
mental retardation and developmental disabilities, an alcohol and	76
drug addiction services board, a board of alcohol, drug addiction,	77
and mental health services, or a community mental health board, or	78
a public entity formed by or on behalf of any of these boards,	79
from using managed care techniques in carrying out the board's or	80
public entity's duties pursuant to the requirements of Chapters	81
307., 329., 340., and 5126. of the Revised Code. However, no such	82
board or public entity may operate so as to compete in the private	83
sector with health insuring corporations holding certificates of	84
authority under this chapter.	85

(D) A corporation formed by or on behalf of a publicly owned,	86
operated, or funded hospital or health care facility may apply to	87
the superintendent for a certificate of authority under division	88
(A) of this section to establish and operate a health insuring	89
corporation.	90

(E) A health insuring corporation shall operate in this state	91
in compliance with this chapter and Chapter 1753. of the Revised	92
Code, and with sections 3702.51 to 3702.62 of the Revised Code,	93
and shall operate in conformity with its filings with the	94
superintendent under this chapter, including filings made pursuant	95
to sections 1751.03, 1751.11, 1751.12, and 1751.31 of the Revised	96
Code.	97

(F) An insurer licensed under Title XXXIX of the Revised Code	98
need not obtain a certificate of authority as a health insuring	99
corporation to offer an open panel plan as long as the providers	100
and health care facilities participating in the open panel plan	101
receive their compensation directly from the insurer. If the	102
providers and health care facilities participating in the open	103
panel plan receive their compensation from any person other than	104
the insurer, or if the insurer offers a closed panel plan, the	105
insurer must obtain a certificate of authority as a health	106
insuring corporation.	107

(G) An intermediary organization need not obtain a	108
certificate of authority as a health insuring corporation,	109
regardless of the method of reimbursement to the intermediary	110
organization, as long as a health insuring corporation or a	111
self-insured employer maintains the ultimate responsibility to	112
assure delivery of all health care services required by the	113
contract between the health insuring corporation and the	114
subscriber and the laws of this state or between the self-insured	115
employer and its employees.	116

Nothing in this section shall be construed to require any	117
health care facility, provider, health delivery network, or	118
intermediary organization that contracts with a health insuring	119
corporation or self-insured employer, regardless of the method of	120
reimbursement to the health care facility, provider, health	121
delivery network, or intermediary organization, to obtain a	122
certificate of authority as a health insuring corporation under	123
this chapter, unless otherwise provided, in the case of contracts	124
with a self-insured employer, by operation of the "Employee	125
Retirement Income Security Act of 1974," 88 Stat. 829, 29 U.S.C.A.	126
1001, as amended.	127

(H) Any health delivery network doing business in this state,	128
including any health delivery network that is functioning as an	129
intermediary organization doing business in this state, that is	130
not required to obtain a certificate of authority under this	131
chapter shall certify to the superintendent annually, not later	132
than the first day of July, and shall provide a statement signed	133
by the highest ranking official which includes the following	134
information:	135

(1) The health delivery network's full name and the address	136
of its principal place of business;	137

(2) A statement that the health delivery network is not	138
required to obtain a certificate of authority under this chapter	139
to conduct its business.	140

(I) The superintendent shall not issue a certificate of	141
authority to a health insuring corporation that is a provider	142
sponsored organization unless all health care plans to be offered	143
by the health insuring corporation provide basic health care	144
services. Substantially all of the physicians and hospitals with	145
ownership or control of the provider sponsored organization, as	146
defined in division (X) of section 1751.01 of the Revised Code,	147
shall also be participating providers for the provision of basic	148
health care services for health care plans offered by the provider	149
sponsored organization. If a health insuring corporation that is a	150
provider sponsored organization offers health care plans that do	151
not provide basic health care services, the health insuring	152
corporation shall be deemed, for purposes of section 1751.35 of	153
the Revised Code, to have failed to substantially comply with this	154
chapter.	155

Except as specifically provided in this division and in	156
division (C)(A) of section 1751.28 of the Revised Code, the	157
provisions of this chapter shall apply to all health insuring	158
corporations that are provider sponsored organizations in the same	159
manner that these provisions apply to all health insuring	160
corporations that are not provider sponsored organizations.	161

(J) Nothing in this section shall be construed to apply to	162
any multiple employer welfare arrangement operating pursuant to	163
Chapter 1739. of the Revised Code.	164

(K) Any person who violates division (B) of this section, and	165
any health delivery network that fails to comply with division (H)	166
of this section, is subject to the penalties set forth in section	167
1751.45 of the Revised Code.	168

Sec. 1751.28.  (A) As used in this section:

169

(1) "Admitted assets" includes the investments authorized by	170
section 1751.25 of the Revised Code, and, in addition to these	171
investments, only the following:	172

(a) Petty cash and other cash funds that are in the health	173
insuring corporation's principal office or any official branch	174
office and that are under the control of the corporation;	175

(b) Immediately withdrawable funds on deposit in demand	176
accounts in a bank or trust company, or similar funds that are	177
actually in the health insuring corporation's principal office or	178
any official branch office at statement date and that are in	179
transit to the bank or trust company with authentic deposit credit	180
given prior to the close of business on the fifth bank business	181
day following the statement date;	182

(c) The amount fairly estimated as recoverable on cash	183
deposited in a bank or trust company the operations of which have	184
been suspended or for which a receiver has been appointed, if	185
qualifying under this section prior to the suspension of	186
operations of or the appointment of a receiver for the bank or	187
trust company;	188

(d) Bills and accounts receivable collateralized by	189
securities of the kind in which the health insuring corporation	190
may invest;	191

(e) Premiums receivable from groups or individuals that are	192
not more than ninety days past due;	193

(f) Accounts receivable that are not more than ninety days	194
past due;	195

(g) Amounts due under reinsurance arrangements from insurance	196
companies authorized to do business in this state;	197

(h) Tax refunds due from the United States or any state;

198

(i) The interest accrued on mortgage loans that conform to	199
section 3925.08 of the Revised Code, not exceeding on an	200
individual loan an aggregate amount of one year's total due and	201
accrued interest;	202

(j) The rents accrued and owing to the health insuring	203
corporation on real and personal property, directly or	204
beneficially owned, not exceeding on each individual property the	205
amount of one year's total due and accrued rent;	206

(k) Interest or rents accrued on conditional sales	207
agreements, security interests, chattel mortgages, and real or	208
personal property under lease to other corporations, that conform	209
to section 3925.08 of the Revised Code, not exceeding on any	210
individual investment the amount of one year's total due and	211
accrued interest or rent;	212

(l) The fixed and required interest due and accrued on bonds	213
and other similar evidences of indebtedness, that conform to	214
section 3925.08 of the Revised Code, and not in default;	215

(m) Dividends receivable on shares of stock that conform to	216
section 3925.08 of the Revised Code, provided that the market	217
price taken for valuation purposes does not include the value of	218
the dividend;	219

(n) The interest or dividends due and payable, but not	220
credited, on deposits in banks and trust companies or on accounts	221
with savings and loan associations;	222

(o) Interest accrued on secured loans that conform to section	223
3925.08 of the Revised Code, not exceeding the amount of one	224
year's interest on any loan;	225

(p) Interest accrued on tax anticipation warrants;

226

(q) The amortized value of electronic computer or data	227
processing machines or systems purchased for use in connection	228
with the business of the health insuring corporation, including	229
software purchased and developed specifically for the use and	230
purposes of the corporation;	231

(r) The cost of furniture, equipment, and medical equipment,	232
less accumulated depreciation on the furniture and equipment to be	233
applied pro rata over a period not to exceed five years, and of	234
medical and pharmaceutical supplies, that are under the control of	235
the health insuring corporation, provided these assets do not	236
exceed fifteen per cent of admitted assets;	237

(s) Amounts due from affiliates to the extent that the	238
affiliate has liquid assets with which to pay the balance and	239
maintain its accounts on a current basis. Any amount outstanding	240
more than three months shall be considered not current.	241

(2) "Liabilities" means the liabilities of the health	242
insuring corporation as determined by the superintendent of	243
insurance.	244

(B) All admitted assets of a health insuring corporation must	245
be held in the health insuring corporation's name and must be free	246
and clear of any encumbrances, pledges, or hypothecation.	247

(C)(1) Every health insuring corporation authorized to	248
provide basic health care services, which health insuring	249
corporation is not a provider sponsored organization, shall	250
maintain total admitted assets equal to at least one hundred ten	251
per cent of the liabilities of the corporation. However, at no	252
time shall the corporation's net worth be less than one million	253
two hundred thousand dollars.	254

(2) Every health insuring corporation authorized to provide	255
only supplemental health care services shall maintain total	256
admitted assets equal to at least one hundred ten per cent of the	257
liabilities of the corporation. However, at no time shall the	258
corporation's net worth be less than five hundred thousand	259
dollars.	260

(3) Every health insuring corporation authorized to provide	261
only specialty health care services shall maintain total admitted	262
assets equal to at least one hundred ten per cent of the	263
liabilities of the corporation. However, at no time shall the	264
corporation's net worth be less than two hundred fifty thousand	265
dollars.	266

(4) Every health insuring corporation authorized to provide	267
both basic health care services and supplemental health care	268
services, which health insuring corporation is not a provider	269
sponsored organization, shall maintain total admitted assets equal	270
to at least one hundred ten per cent of the liabilities of the	271
corporation. However, at no time shall the corporation's net worth	272
be less than one million seven hundred thousand dollars.	273

(5) Every health insuring corporation authorized to provide	274
both basic health care services and specialty health care	275
services, which health insuring corporation is not a provider	276
sponsored organization, shall maintain total admitted assets equal	277
to at least one hundred ten per cent of the liabilities of the	278
corporation. However, at no time shall the corporation's net worth	279
be less than one million four hundred fifty thousand dollars.	280

(6) Every health insuring corporation authorized to provide	281
basic health care services, which health insuring corporation is a	282
provider sponsored organization, shall maintain total admitted	283
assets equal to at least one hundred ten per cent of the	284
liabilities of the corporation. However, at no time shall the	285
corporation's net worth be less than one million dollars.	286

(7) Every health insuring corporation authorized to provide	287
both basic health care services and supplemental health care	288
services, which health insuring corporation is a provider	289
sponsored organization, shall maintain total admitted assets equal	290
to at least one hundred ten per cent of the liabilities of the	291
corporation. However, at no time shall the corporation's net worth	292
be less than one million five hundred thousand dollars.	293

(8) Every health insuring corporation authorized to provide	294
both basic health care services and specialty health care	295
services, which health insuring corporation is a provider	296
sponsored organization, shall maintain total admitted assets equal	297
to at least one hundred ten per cent of the liabilities of the	298
corporation. However, at no time shall the corporation's net worth	299
be less than one million two hundred fifty thousand dollars.	300

(D) The admitted value of any real estate owned by a health	301
insuring corporation, whether used for the accommodation of the	302
health insuring corporation's business operations or otherwise,	303
shall be the original cost plus the cost of improvements, less	304
encumbrances and accumulated depreciation.	305

(E)(B) The net worth otherwise required by this section shall	306
be reduced by an amount representing credit given to reserve	307
liabilities when a health insuring corporation carries reinsurance	308
with an admitted reinsurer. However, such an amount shall not	309
affect the minimum amounts set forth in this section and section	310
1751.27 of the Revised Code.	311

(C) A health insuring corporation may only consider those	312
admitted assets in connection with this section that are	313
consistent with the forms, instructions, and manuals for the	314
preparation and reporting of statutory financial statements and	315
other financial information set forth in section 1751.47 of the	316
Revised Code and any rules adopted under that section.	317

(D) All health insuring corporations must comply with this	318
section, as amended, for calendar year 2004 and each calendar year	319
thereafter.	320

Sec. 3901.78.  Upon the filing of each of its annual	321
statements, or as soon thereafter as practicable, the	322
superintendent of insurance shall issue to each insurance company	323
or association authorized to do business in this state but not	324
incorporated under the laws of this state a certificate that it	325
has complied with the laws of this state. Such certificate of	326
compliance shall also contain a statement of the amounts of the	327
paid-up capital stock, assets, liabilities, income, and	328
expenditures of the company or association for the preceding year,	329
as shown by its annual statement for that year. The superintendent	330
shall issue to each newly-applying company or association that the	331
superintendent finds should be authorized to do business in this	332
state, a certificate that it has complied with the laws of this	333
state, which certificate shall contain a statement of the amounts	334
of its paid-up capital stock, assets, liabilities, income, and	335
expenditures as shown by a financial statement submitted by it,	336
under the oath of its officers.of compliance, an original of	337
which must be published in accordance with section 3901.781 of the	338
Revised Code in every county where the insurance company or	339
association has an agency. Upon request or in any other	340
circumstance that the superintendent determines to be appropriate,	341
the superintendent may issue other certificates of compliance,	342
which certificates are not subject to section 3901.781 of the	343
Revised Code, to insurance companies and associations authorized	344
to do business in this state. Certificates of compliance either	345
must be on forms established by the national association of	346
insurance commissioners or on such other forms as the	347
superintendent may prescribe.	348

Sec. 3905.14.  (A) As used in sections 3905.14 to 3905.16 of	349
the Revised Code:	350

(1) "Insurance agent" includes a limited lines insurance	351
agent, surety bail bond agent, and surplus line broker.	352

(2) "Refusal to issue or renew" means the decision of the	353
superintendent of insurance not to process either the initial	354
application for a license as an agent or the renewal of such a	355
license.	356

(3) "Revocation" means the permanent termination of all	357
authority to hold any license as an agent in this state.	358

(4) "Surrender for cause" means the voluntary termination of	359
all authority to hold any license as an agent in this state, in	360
lieu of a revocation or suspension order.	361

(5) "Suspension" means the termination of all authority to	362
hold any license as an agent in this state, for either a specified	363
period of time or an indefinite period of time and under any terms	364
or conditions determined by the superintendent.	365

(B) The superintendent may suspend, revoke, or refuse to	366
issue or renew any license of an insurance agent, assess a civil	367
penalty, or impose any other sanction or sanctions authorized	368
under this chapter, for one or more of the following reasons:	369

(1) Providing incorrect, misleading, incomplete, or	370
materially untrue information in a license or appointment	371
application;	372

(2) Violating or failing to comply with any insurance law,	373
rule, subpoena, consent agreement, or order of the superintendent	374
or of the insurance authority of another state;	375

(3) Obtaining or attempting to obtain a license through	376
misrepresentation or fraud;	377

(4) Improperly withholding, misappropriating, or converting	378
any money or property received in the course of doing insurance	379
business;	380

(5) Intentionally misrepresenting the terms, benefits, value,	381
cost, or effective dates of any actual or proposed insurance	382
contract or application for insurance;	383

(6) Having been convicted of a felony;

384

(7) Having been convicted of a misdemeanor that involves the	385
misuse or theft of money or property belonging to another, fraud,	386
forgery, dishonest acts, or breach of a fiduciary duty, that is	387
based on any act or omission relating to the business of	388
insurance, securities, or financial services, or that involves	389
moral turpitude;	390

(8) Having admitted to committing, or having been found to	391
have committed, any insurance unfair trade act or practice or	392
insurance fraud;	393

(9) Using fraudulent, coercive, or dishonest practices, or	394
demonstrating incompetence, untrustworthiness, or financial	395
irresponsibility, in the conduct of business in this state or	396
elsewhere;	397

(10) Having an insurance agent license, or its equivalent,	398
denied, suspended, or revoked in any other state, province,	399
district, or territory;	400

(11) Forging or causing the forgery of an application for	401
insurance or any document related to or used in an insurance	402
transaction;	403

(12) Improperly using notes or any other reference material	404
to complete an examination for an insurance agent license;	405

(13) Knowingly accepting insurance business from an	406
individual who is not licensed;	407

(14) Failing to comply with any administrative or court order	408
directing payment of state income tax;	409

(15) Failing to timely submit an application for insurance.	410
For purposes of division (B)(15) of this section, a submission is	411
considered timely if it occurs within the time period expressly	412
provided for by the insurer, or within seven days after the	413
insurance agent accepts a premium or an order to bind coverage	414
from a policyholder or applicant for insurance, whichever is	415
later.	416

(16) Failing to disclose to an applicant for insurance or	417
policyholder upon accepting a premium or an order to bind coverage	418
from the applicant or policyholder, that the person has not been	419
appointed by the insurer;	420

(17) Having any professional license suspended or revoked as	421
a result of a mishandling of funds or breach of fiduciary	422
responsibilities or having been subject to a cease and desist	423
order or permanent injunction for unlicensed activities;	424

(18) Causing or permitting a policyholder or applicant for	425
insurance to designate the insurance agent or the insurance	426
agent's spouse, parent, child, or sibling as the beneficiary of a	427
policy or annuity sold by the insurance agent, unless the	428
insurance agent or a relative of the insurance agent is the	429
insured or applicant;	430

(19) Failing to provide a written response to the department	431
of insurance within twenty-one calendar days after receipt of any	432
written inquiry from the department, unless a reasonable extension	433
of time has been requested of, and granted by, the superintendent;	434

(20) Transferring or placing insurance with an insurer other	435
than the insurer expressly chosen by the applicant for insurance	436
or policyholder without the consent of the applicant or	437
policyholder or absent extenuating circumstances;	438

(21) Failing to inform a policyholder or applicant for	439
insurance of the identity of the insurer or insurers, or the	440
identity of any other insurance agent or licensee known to be	441
involved in procuring, placing, or continuing the insurance for	442
the policyholder or applicant, upon the binding of the coverage;	443

(22) In the case of an agent that is a business entity,	444
failing to report an individual licensee's violation to the	445
department when the violation was known or should have been known	446
by one or more of the partners, officers, managers, or members of	447
the business entity;	448

(23) Submitting or using a document in the conduct of the	449
business of insurance when the person knew or should have known	450
that the document contained the forged signature of another	451
person;	452

(24) Misrepresenting the person's qualifications or using in	453
any way a professional designation that has not been conferred	454
upon the person by the appropriate accrediting organization;	455

(25) Obtaining a premium loan or causing a premium loan to be	456
made to or in the name of an insured without that person's	457
knowledge and written authorization;	458

(26) Using paper, software, or any other materials of or	459
provided by an insurer after the insurer has terminated the	460
authority of the licensee, if the use of such materials would	461
cause a reasonable person to believe that the licensee was acting	462
on behalf of or otherwise representing the insurer;	463

(27) Soliciting, procuring an application for, or placing,	464
either directly or indirectly, any insurance policy when the	465
person is not authorized under this chapter to engage in such	466
activity;	467

(28) Soliciting, marketing, or selling any product or service	468
that offers benefits similar to insurance but is not regulated by	469
the superintendent, without fully disclosing to the prospective	470
purchaser that the product or service is not insurance and is not	471
regulated by the superintendent;	472

(29) Failing to fulfill a refund obligation to a policyholder	473
or applicant in a timely manner. For purposes of division (B)(29)	474
of this section, a rebuttable presumption exists that a refund	475
obligation is not fulfilled in a timely manner unless it is	476
fulfilled within one of the following time periods:	477

(a) Thirty days after the date the policyholder, applicant,	478
or insurer takes or requests action resulting in a refund;	479

(b) Thirty days after the date of the insurer's refund check,	480
if the agent is expected to issue a portion of the total refund;	481

(c) Forty-five days after the date of the agent's statement	482
of account on which the refund first appears.	483

The presumption may be rebutted by proof that the	484
policyholder or applicant consented to the delay or agreed to	485
permit the agent to apply the refund to amounts due for other	486
coverages.	487

(30) With respect to a surety bail bond agent license,	488
rebating or offering to rebate, or unlawfully dividing or offering	489
to divide, any commission;	490

(31) Using a license for the principal purpose of procuring,	491
receiving, or forwarding applications for insurance of any kind,	492
other than life, or soliciting, placing, or effecting such	493
insurance directly or indirectly upon or in connection with the	494
property of the licensee or that of relatives, employers,	495
employees, or that for which they or the licensee is an agent,	496
custodian, vendor, bailee, trustee, or payee;	497

(32) In the case of an insurance agent that is a business	498
entity, using a life license for the principal purpose of	499
soliciting or placing insurance on the lives of the business	500
entity's officers, employees, or shareholders, or on the lives of	501
relatives of such officers, employees, or shareholders, or on the	502
lives of persons for whom they, their relatives, or the business	503
entity is agent, custodian, vendor, bailee, trustee, or payee;	504

(33) Offering within this state, in person or by	505
advertisement, poster, letter, circular, or otherwise, to sell,	506
procure, or obtain, selling, soliciting, or negotiating policies,	507
contracts, agreements, or applications for life insurance, or	508
annuities providing fixed, variable, or fixed and variable	509
benefits, or contractual payments, or any form of sickness and	510
accident insurance, for or on behalf of any life insurance	511
corporation, association, or organization, or mutual protective or	512
mutual benefit association or organization,insurer or multiple	513
employer welfare arrangement not authorized to transact business	514
in this state, or for or on behalf of any spurious, fictitious,	515
nonexistent, dissolved, inactive, liquidated or liquidating, or	516
bankrupt life insurance corporation, association, or organization,	517
or mutual protective or mutual benefit association or organization	518
insurer or multiple employer welfare arrangement.	519

(C) Before denying, revoking, suspending, or refusing to	520
issue any license or imposing any penalty under this section, the	521
superintendent shall provide the licensee or applicant with notice	522
and an opportunity for hearing as provided in Chapter 119. of the	523
Revised Code, except as follows:	524

(1)(a) Any notice of opportunity for hearing, the hearing	525
officer's findings and recommendations, or the superintendent's	526
order shall be served by certified mail at the last known address	527
of the licensee or applicant. Service shall be evidenced by return	528
receipt signed by any person.	529

For purposes of this section, the "last known address" is the	530
residential address of a licensee or applicant, or the	531
principal-place-of-business address of a business entity, that is	532
contained in the licensing records of the department.	533

(b) If the certified mail envelope is returned with an	534
endorsement showing that service was refused, or that the envelope	535
was unclaimed, the notice and all subsequent notices required by	536
Chapter 119. of the Revised Code may be served by ordinary mail to	537
the last known address of the licensee or applicant. The mailing	538
shall be evidenced by a certificate of mailing. Service is deemed	539
complete as of the date of such certificate provided that the	540
ordinary mail envelope is not returned by the postal authorities	541
with an endorsement showing failure of delivery. The time period	542
in which to request a hearing, as provided in Chapter 119. of the	543
Revised Code, begins to run on the date of mailing.	544

(c) If service by ordinary mail fails, the superintendent may	545
cause a summary of the substantive provisions of the notice to be	546
published once a week for three consecutive weeks in a newspaper	547
of general circulation in the county where the last known place of	548
residence or business of the party is located. The notice is	549
considered served on the date of the third publication.	550

(d) Any notice required to be served under Chapter 119. of	551
the Revised Code shall also be served upon the party's attorney by	552
ordinary mail if the attorney has entered an appearance in the	553
matter.	554

(e) The superintendent may, at any time, perfect service on a	555
party by personal delivery of the notice by an employee of the	556
department.	557

(f) Notices regarding the scheduling of hearings and all	558
other matters not described in division (C)(1)(a) of this section	559
shall be sent by ordinary mail to the party and to the party's	560
attorney.	561

(2) Any subpoena for the appearance of a witness or the	562
production of documents or other evidence at a hearing, or for the	563
purpose of taking testimony for use at a hearing, shall be served	564
by certified mail, return receipt requested, by an attorney or by	565
an employee of the department designated by the superintendent.	566
Such subpoenas shall be enforced in the manner provided in section	567
119.09 of the Revised Code. Nothing in this section shall be	568
construed as limiting the superintendent's other statutory powers	569
to issue subpoenas.	570

(D) If the superintendent determines that a violation	571
described in this section has occurred, the superintendent may	572
take one or more of the following actions:	573

(1) Assess a civil penalty in an amount not exceeding	574
twenty-five thousand dollars per violation;	575

(2) Assess administrative costs to cover the expenses	576
incurred by the department in the administrative action, including	577
costs incurred in the investigation and hearing processes. Any	578
costs collected shall be paid into the state treasury to the	579
credit of the department of insurance operating fund created in	580
section 3901.021 of the Revised Code.	581

(3) Suspend all of the person's licenses for all lines of	582
insurance for either a specified period of time or an indefinite	583
period of time and under such terms and conditions as the	584
superintendent may determine;	585

(4) Permanently revoke all of the person's licenses for all	586
lines of insurance;	587

(5) Refuse to issue a license;

588

(6) Refuse to renew a license;

589

(7) Prohibit the person from being employed in any capacity	590
in the business of insurance and from having any financial	591
interest in any insurance agency, company, surety bail bond	592
business, or third-party administrator in this state. The	593
superintendent may, in the superintendent's discretion, determine	594
the nature, conditions, and duration of such restrictions.	595

(8) Order corrective actions in lieu of or in addition to the	596
other penalties listed in division (D) of this section. Such an	597
order may provide for the suspension of civil penalties, license	598
revocation, license suspension, or refusal to issue or renew a	599
license if the licensee complies with the terms and conditions of	600
the corrective action order.	601

(9) Accept a surrender for cause offered by the licensee,	602
which shall be for at least five years and shall prohibit the	603
licensee from seeking any license authorized under this chapter	604
during that time period. A surrender for cause shall be in lieu of	605
revocation or suspension and may include a corrective action order	606
as provided in division (D)(8) of this section.	607

(E) The superintendent may consider the following factors in	608
denying a license, imposing suspensions, revocations, fines, or	609
other penalties, and issuing orders under this section:	610

(1) Whether the person acted in good faith;

611

(2) Whether the person made restitution for any pecuniary	612
losses suffered by other persons as a result of the person's	613
actions;	614

(3) The actual harm or potential for harm to others;

615

(4) The degree of trust placed in the person by, and the	616
vulnerability of, persons who were or could have been adversely	617
affected by the person's actions;	618

(5) Whether the person was the subject of any previous	619
administrative actions by the superintendent;	620

(6) The number of individuals adversely affected by the	621
person's acts or omissions;	622

(7) Whether the person voluntarily reported the violation,	623
and the extent of the person's cooperation and acceptance of	624
responsibility;	625

(8) Whether the person obstructed or impeded, or attempted to	626
obstruct or impede, the superintendent's investigation;	627

(9) The person's efforts to conceal the misconduct;

628

(10) Remedial efforts to prevent future violations;

629

(11) If the person was convicted of a criminal offense, the	630
nature of the offense, whether the conviction was based on acts or	631
omissions taken under any professional license, whether the	632
offense involved the breach of a fiduciary duty, the amount of	633
time that has passed, and the person's activities subsequent to	634
the conviction;	635

(12) Such other factors as the superintendent determines to	636
be appropriate under the circumstances.	637

(F)(1) A violation described in division (B)(1), (2), (3),	638
(4), (5), (6), (7), (8), (9), (10), (11), (12), (13), (14), (16),	639
(17), (18), (20), (21), (22), (23), (24), (25), (26), (27), (28),	640
(29), (30), (31), (32), or (33) of this section is a class A	641
offense for which the superintendent may impose any penalty set	642
forth in division (D) of this section.	643

(2) A violation described in division (B)(15) or (19) of this	644
section, or a failure to comply with section 3905.061, 3905.071,	645
or 3905.22 of the Revised Code, is a class B offense for which the	646
superintendent may impose any penalty set forth in division	647
(D)(1), (2), (8), or (9) of this section.	648

(3) If the superintendent determines that a violation	649
described in division (B)(33) of this section has occurred, the	650
superintendent shall impose a minimum of a two-year suspension on	651
all of the person's licenses for all lines of insurance.	652

(G) If a violation described in this section has caused, is	653
causing, or is about to cause substantial and material harm, the	654
superintendent may issue an order requiring that person to cease	655
and desist from engaging in the violation. Notice of the order	656
shall be mailed by certified mail, return receipt requested, or	657
served in any other manner provided for in this section,	658
immediately after its issuance to the person subject to the order	659
and to all persons known to be involved in the violation. The	660
superintendent may thereafter publicize or otherwise make known to	661
all interested parties that the order has been issued.	662

The notice shall specify the particular act, omission,	663
practice, or transaction that is subject to the cease-and-desist	664
order and shall set a date, not more than fifteen days after the	665
date of the order, for a hearing on the continuation or revocation	666
of the order. The person shall comply with the order immediately	667
upon receipt of notice of the order.	668

The superintendent may, upon the application of a party and	669
for good cause shown, continue the hearing. Chapter 119. of the	670
Revised Code applies to such hearings to the extent that that	671
chapter does not conflict with the procedures set forth in this	672
section. The superintendent shall, within fifteen days after	673
objections are submitted to the hearing officer's report and	674
recommendation, issue a final order either confirming or revoking	675
the cease-and-desist order. The final order may be appealed as	676
provided under section 119.12 of the Revised Code.	677

The remedy under this division is cumulative and concurrent	678
with the other remedies available under this section.	679

(H) If the superintendent has reasonable cause to believe	680
that an order issued under this section has been violated in whole	681
or in part, the superintendent may request the attorney general to	682
commence and prosecute any appropriate action or proceeding in the	683
name of the state against such person.	684

The court may, in an action brought pursuant to this	685
division, impose any of the following:	686

(1) For each violation, a civil penalty of not more than	687
twenty-five thousand dollars;	688

(2) Injunctive relief;

689

(3) Restitution;

690

(4) Any other appropriate relief.

691

(I) With respect to a surety bail bond agent license:

692

(1) Upon the suspension or revocation of a license, or the	693
eligibility of a surety bail bond agent to hold a license, the	694
superintendent likewise may suspend or revoke the license or	695
eligibility of any surety bail bond agent who is employed by or	696
associated with that agent and who knowingly was a party to the	697
act that resulted in the suspension or revocation.	698

(2) The superintendent may revoke a license as a surety bail	699
bond agent if the licensee is adjudged bankrupt.	700

(J) Nothing in this section shall be construed to create or	701
imply a private cause of action against an agent or insurer.	702

Sec. 3917.01.  (A) Group life insurance is that form of life	703
insurance covering not less than ten employees with or without	704
medical examination, written under a policy issued to the	705
employer, or to a trustee of a trust created by such employer, the	706
premium on which is to be paid by the employer, by the employer	707
and employees jointly, or by such trustee out of funds contributed	708
by the employer or by the employer and employees jointly, and	709
insuring only all of the employer's employees or all of any	710
classes thereof, determined by sex, age, or conditions pertaining	711
to the employment, for amounts of insurance based upon some plan	712
which will preclude individual selection, for the benefit of	713
persons other than the employer; but when the premium is to be	714
paid by the employer and employee jointly and the benefits of the	715
policy are offered to all eligible employees, not less than	716
seventy-five per cent of such employees may be so insured. Such	717
group policy may provide that "employees" includes retired	718
employees of the employer and the officers, managers, employees,	719
and retired employees of subsidiary or affiliated corporations and	720
the individual proprietors, partners, employees, and retired	721
employees of affiliated individuals and firms, when the business	722
of such subsidiary or affiliated corporations, firms, or	723
individuals is controlled by the common employer through stock	724
ownership, contract, or otherwise. This section does not define as	725
a group the lives covered by a policy issued on more than one life	726
which provides for payments upon the death of any one or more or	727
upon the death of each of the lives so insured, and upon which the	728
premium rates charged are computed on the same basis as used by	729
the issuing company on single life policies and upon its regular	730
forms of insurance.	731

(B) As used in sections 3917.01 to 3917.06 of the Revised	732
Code, the following forms of life insurance are group life	733
insurance:	734

(1) Life insurance covering the members of one or more	735
companies, batteries, troops, battalions, divisions, or other	736
units of the national guard or naval militia of any state, written	737
under a policy issued to the commanding general of the national	738
guard or commanding officer of the naval militia, who is the	739
employer for the purposes of such sections, the premium on which	740
is to be paid by the members of such units for the benefit of	741
persons other than the employer; provided that when the benefits	742
of the policy are offered to all eligible members of a unit of the	743
national guard or naval militia, not less than seventy-five per	744
cent of the members of such a unit may be insured;	745

(2) Life insurance covering the members of one or more troops	746
or other units of the state troopers or state police of any state,	747
written under a policy issued to the commanding officer of the	748
state troopers or state police who is the employer for the	749
purposes of such sections, the premium on which is to be paid by	750
the members of such units for the benefit of persons other than	751
the employer; provided that when the benefits of the policy are	752
offered to all eligible members of a unit of the state troopers or	753
state police, not less than seventy-five per cent of the members	754
of such a unit may be insured;	755

(3) Life insurance covering the members of any labor union,	756
written under a policy issued to such union which is the employer	757
for the purposes of such sections, the premium on which is to be	758
paid by the union or by the union and its members jointly, and	759
insuring only all of its members, who are actively engaged in the	760
same occupation, for amounts of insurance based upon some plan	761
which will preclude individual selection, for the benefit of	762
persons other than the union or its officials; provided that in	763
case the insurance policy is cancellable at the end of any policy	764
year at the option of the insurance company and that the basis of	765
premium rates may be changed by the insurance company at the	766
beginning of any policy year, all members of a labor union may be	767
insured; and provided that when the premium is to be paid by the	768
union and its members jointly and the benefits are offered to all	769
eligible members, not less than seventy-five per cent of such	770
members may be insured; and provided that when members apply and	771
pay for additional amounts of insurance, a smaller percentage of	772
members may be insured for such additional amounts if they pass	773
satisfactory medical examinations or submit satisfactory evidence	774
of insurability;	775

(4) Life insurance written under a policy issued to a	776
creditor, who shall be deemed the policyholder, to insure debtors	777
of the creditor, subject to the following requirements:	778

(a) The debtors eligible for insurance under the policy shall	779
be all of the debtors of the creditor, excepting that no debtor is	780
eligible unless the indebtedness constitutes an obligation to	781
repay that is binding upon the debtor during the debtor's lifetime	782
at and from the date the insurance becomes effective upon the	783
debtor's life. The policy may provide that "debtors" includes the	784
debtors of one or more subsidiary corporations and the debtors of	785
one or more affiliated corporations, proprietors, or partnerships	786
if the business of the policyholder and of such affiliated	787
corporations, proprietors, or partnerships is under common control	788
through stock ownership, contract, or otherwise.	789

(b) The premium for the policy shall be paid by the	790
policyholder, either from the creditor's funds, or from charges	791
collected from the insured debtors, or from both. A policy on	792
which part or all of the premium is to be derived from the	793
collection from the insured debtors of identifiable charges not	794
required of uninsured debtors shall not include debtors under	795
obligations outstanding at its date of issue without evidence of	796
individual insurability unless at least seventy-five per cent of	797
the then eligible debtors elect to pay the required charges. A	798
policy on which no part of the premium is to be derived from the	799
collection of such identifiable charges must insure all eligible	800
debtors, or all except any as to whom evidence of individual	801
insurability is not satisfactory to the insurer.	802

(c) The policy may be issued only if the group of eligible	803
debtors is then receiving new entrants at the rate of at least one	804
hundred persons yearly, or may reasonably be expected to receive	805
at least one hundred new entrants during the first policy year,	806
and continues to receive not less than one hundred new entrants to	807
the group yearly, and only if the policy reserves to the insurer	808
the right to require evidence of individual insurability if less	809
than seventy-five per cent of the new entrants become insured. The	810
policy may exclude from the classes eligible for insurance classes	811
of debtors determined by age.	812

(d) The amount of insurance on the life of any debtor may be	813
determined by the age of the debtor based upon a plan which will	814
preclude individual selection and shall at no time exceed the	815
amount owed by the debtor that is repayable in installments to the	816
creditor.	817

(e) The insurance shall be payable to the policyholder. Such	818
payment shall reduce or extinguish the unpaid indebtedness of the	819
debtor to the extent of such payment.	820

(5) Life insurance covering the members of any duly organized	821
corporation or association of veterans or veteran society or	822
association of the World War veterans, written under a policy	823
issued to such corporation, association, or society which is the	824
employer for the purpose of such sections, the premium on which is	825
to be paid by the corporation, association, society, and its	826
members jointly, and insuring all of its members who are actively	827
engaged in any occupation for amounts of insurance based upon some	828
plan which will preclude individual selection for the benefit of	829
persons other than the corporation, association, or society or its	830
officials; provided that when the premium is to be paid by the	831
corporation, association, or society and its members jointly and	832
the benefits are offered to all eligible members, not less than	833
seventy-five per cent of such members may be insured; and provided	834
that when members apply and pay for additional amounts of	835
insurance, a smaller percentage of members may be insured for such	836
additional amounts if they pass satisfactory medical examinations	837
or submit satisfactory evidence of insurability;	838

(6) Life insurance covering the members of any organization	839
of agriculturists or horticulturists organized under the	840
co-operative laws of this state, written under a policy issued to	841
such co-operative association which is the employer for the	842
purpose of such sections, the premium on which is to be paid by	843
the association or by the association and its members jointly, and	844
insuring all of its members who are actively engaged in	845
agricultural or horticultural pursuits, for an amount of insurance	846
based upon some plan which will preclude individual selection, and	847
for the benefit of persons other than the association or its	848
officials; provided that when the premium is to be paid by the	849
corporation, association, or society and its members jointly and	850
the benefits are offered to all eligible members, not less than	851
seventy-five per cent of such members may be insured; provided	852
that when members apply and pay for additional amounts of	853
insurance, a smaller percentage of members may be insured for such	854
additional amounts if they pass satisfactory medical examinations	855
or submit satisfactory evidence of insurability;	856

(7) Life insurance covering employees of a political	857
subdivision or district of this state, or of an educational or	858
other institution supported in whole or in part by public funds,	859
or of any classes thereof, determined by conditions pertaining to	860
employment, or of this state or any department or division	861
thereof, written under a policy issued to such political	862
subdivision, district, or institution, or the proper official or	863
board of this state or of such state department or division	864
thereof, which is the employer for the purpose of such sections,	865
the premium on which is to be paid by such employees, unless	866
otherwise provided by law, charter, or ordinance, for the benefit	867
of persons other than the employer; provided that when the	868
benefits of the policy are offered to all eligible employees of a	869
political subdivision or district of the state or of an	870
educational or other institution supported in whole, or in part by	871
public funds, or of this state or a state department or division	872
thereof, not less than seventy-five per cent of such employees may	873
be insured; and provided that when employees apply and pay for	874
additional amounts of insurance, a smaller percentage of employees	875
may be insured for such additional amounts if they pass	876
satisfactory medical examinations or submit satisfactory evidence	877
of insurability; and provided that upon acquisition by a political	878
subdivision of any privately owned property or enterprise, the	879
employees of which have been covered by a group policy of life or	880
other insurance as employees of such private employer, such	881
political subdivision and insurance company may continue such	882
contract in force upon similar conditions as the last preceding	883
private employer;	884

(8) Life insurance covering the members, or the members and	885
the employees of members of any duly organized association, other	886
than an association subject to any other provision of this	887
division, written under a policy issued to such association, which	888
association is the employer for the purpose of such sections, the	889
premium on which is to be paid by the insured members or their	890
employees, insuring members and their employees for amounts of	891
insurance based upon some plan which will preclude individual	892
selection except as provided in this section, for the benefit of	893
persons other than the association; provided the association has	894
been in existence for at least two years immediately preceding the	895
purchase of the insurance; provided that there must be at least	896
fifty insured members in any group; and provided that the	897
association has been organized and is maintained in good faith for	898
purposes other than that of obtaining insurance;	899

(9) Life insurance issued to trustees of a trust fund	900
established jointly by one or more employers in the same industry,	901
on the one hand, and one or more labor unions representing as	902
bargaining agents employees of such employers, on the other hand,	903
or by two or more employers in the same industry, or by two or	904
more labor unions, which trustees shall be deemed the policyholder	905
to insure employees of the employers or members of unions for the	906
benefit of persons other than the employers or the unions or the	907
trustees, subject to the following requirements:	908

(a) The persons eligible for such insurance shall be all of	909
the employees of the employers, or all of the members of the	910
unions, or all of any class of such employees determined by sex,	911
age, or conditions pertaining to their employment, or to	912
membership in the unions, or to any or all of them. The policy may	913
provide that "employees" includes the retired employees of the	914
employer and the officers, managers, employees, and retired	915
employees of subsidiary or affiliated corporations and the	916
individual proprietors, partners, employees, and retired employees	917
of affiliated individuals and firms, when the business of such	918
subsidiary or affiliated corporations, firms, or individuals is	919
controlled by the common employer through stock ownership,	920
contract, or otherwise. The policy may provide that "employees"	921
includes the individual proprietor or partners if the employer is	922
an individual proprietor or a partnership. The policy may provide	923
that "employees" includes the trustees or their employees, or	924
both, if their duties are principally connected with such	925
trusteeship.	926

(b) The premium for the policy shall be paid by the trustees,	927
either wholly from funds contributed by the employers of the	928
insured persons, or partly from such funds and partly from funds	929
contributed by the insured employees. If part of the premium is to	930
be derived from funds contributed by the insured employees, then	931
such policy may be placed in force only if it covers at least	932
seventy-five per cent of the then eligible employees. A policy on	933
which no part of the premium is derived from funds contributed by	934
the insured employees must insure all eligible employees.	935

(c) Any policy must insure at least ten persons at date of	936
issue.	937

(d) The amounts of insurance under the policy must be based	938
upon some plan precluding individual selection by the insured	939
persons or the policyholder or the employers or the unions or the	940
trustees.	941

(10) Life insurance covering the members of a credit union,	942
which shall be deemed to be the employer for the purposes of this	943
section, the premium on which is to be paid by the credit union or	944
by the credit union and its members jointly, and insuring all of	945
its eligible members for amounts of insurance not in excess of the	946
share balance as to each member, and for the benefit of persons	947
other than the credit union or its officers; provided that in the	948
determination of the eligibility of members there may be	949
classifications and limitations based upon age; provided also that	950
when the premium is to be paid by the credit union and its members	951
jointly and the benefits are offered to all eligible members, not	952
less than seventy-five per cent of such members may be so insured;	953
provided also that in obtaining such insurance, the officers of	954
the credit union shall consider proposals from any licensed	955
insurer; provided also that members may be required to provide	956
evidence of insurability satisfactory to the insurer.	957

(11) Life insurance covering the members of any duly	958
organized corporation or association of members of the Ohio	959
national guard, the Ohio naval militia, and the Ohio military	960
reserve, which shall have been in existence for at least two years	961
immediately preceding the purchase of such insurance, written	962
under a policy issued to such corporation or association, which	963
corporation or association is the employer for the purpose of such	964
sections, the premium on which is to be paid by the insured	965
members, insuring members for amounts of insurance based upon some	966
plan which will preclude individual selection, except as provided	967
in this section, for the benefit of persons other than the	968
corporation or association, provided that there must be at least	969
fifty insured members in any group, and provided further that	970
unless seventy-five per cent of all members or one thousand	971
members, whichever is the lesser number, are insured, each member	972
must pass a satisfactory medical examination in order to be	973
insured; and provided that, when members apply and pay for	974
additional amounts of insurance, they may be insured for such	975
additional amounts if they pass satisfactory medical examinations	976
or submit satisfactory evidence of insurability.	977

(12) Life insurance that is written under a policy issued to	978
a trustee under a trust established by an insurer for the purpose	979
of providing continued group life insurance coverage to those	980
former employees, former members, or former members and the	981
employees of such members, and their spouses and dependent	982
children, previously covered under policies of group life	983
insurance issued by the insurer to employers or trustees pursuant	984
to division (A) of this section, to associations pursuant to	985
division (B)(8) of this section, or to trustees pursuant to	986
division (B)(9) of this section, and that is evidenced by the	987
issuance of a certificate of insurance to such former employees or	988
members; provided that the amount of the continued life insurance	989
coverage made available to a former employee or member and to the	990
employee's or member's spouse and dependents shall not exceed the	991
amount of the group life insurance coverage previously provided to	992
the employee or member and the employee's or member's eligible	993
dependents at the time of the employee's separation from	994
employment or the member's termination of membership.	995

(13) Life insurance covering the members of a workforce	996
actively engaged in an occupation for, and performing services on	997
behalf of, a duly organized corporation, limited liability	998
company, partnership, proprietor, or similar organization, whose	999
members are not employees of the organization, written under a	1000
policy issued to the organization, which organization is the	1001
members' employer for this purpose, the premium on which is to be	1002
paid by the organization or by the organization and the members	1003
jointly, insuring members for amounts of insurance based upon some	1004
plan which will preclude individual selection, for the benefit of	1005
persons other than the organization; provided, that when the	1006
premium is to be paid by the organization and its members jointly	1007
and the benefits are offered to all eligible members, not less	1008
than seventy-five per cent of the members may be so insured;	1009
provided also that members may be required to furnish evidence of	1010
insurability satisfactory to the insurer. Life insurance meeting	1011
this definition may also cover the organization's employees at the	1012
option of the organization.	1013

(C) Any policy issued pursuant to this section, except a	1014
policy issued to a creditor pursuant to division (B)(4) of this	1015
section, may be extended, in the form of group term life insurance	1016
only, to insure the spouse and dependent children of an insured	1017
employee or member, or any class or classes thereof, subject to	1018
the following requirements:	1019

(1) The premiums for the group term life insurance shall be	1020
paid by the policyholder, either from the employer, union or	1021
association funds, or from funds contributed by the employer,	1022
union, or association, or from funds contributed by the insured	1023
employee or member, or from both.	1024

(2) The amounts of insurance under the policy must be based	1025
upon some plan precluding individual selection either by the	1026
insured employee or member or by the policyholder.	1027

(3) Upon termination of the group term life insurance with	1028
respect to the spouse of any insured employee or member by reason	1029
of such person's termination of employment or membership or death,	1030
the spouse insured pursuant to this section shall have the same	1031
conversion rights as to the group term life insurance on the	1032
spouse's life as is provided for the insured employee or member.	1033

(4) Only one certificate need be issued for delivery to an	1034
insured employee or member if a statement concerning any	1035
dependent's coverage is included in such certificate.	1036

Sec. 3999.18.  (A) No person shall establish, operate, or	1037
maintain any entity that delivers, issues for delivery, or renews	1038
any policy of sickness and accident insurance or contract for	1039
health care services in this state if the entity is required to,	1040
but does not, have a valid certificate of authority under Chapter	1041
1751. or Title XXXIX of the Revised Code.	1042

(B) No insurance agent, broker, or other person shall	1043
advertise, solicit, negotiate, collect a premium on, or sell any	1044
policy of sickness and accident insurance or contract for health	1045
care services in this state unless the entity that delivers,	1046
issues for delivery, or renews the policy or contract is subject	1047
to and has complied with division (A) of this section.	1048

Sec. 3999.99.  (A) Whoever violates section 3999.02 of the	1049
Revised Code is guilty of a misdemeanor of the second degree.	1050

(B) Whoever violates section 3999.03, 3999.07, 3999.13,	1051
3999.14, or 3999.15 of the Revised Code is guilty of a misdemeanor	1052
of the first degree.	1053

(C) Whoever violates section 3999.04, 3999.05, 3999.08, or	1054
3999.09 of the Revised Code is guilty of a misdemeanor of the	1055
fourth degree.	1056

(D) Whoever violates section 3999.10 or 3999.11 of the	1057
Revised Code shall be fined five hundred dollars for a first	1058
offense and shall be fined one thousand dollars for each	1059
subsequent offense.	1060

(E) Whoever violates section 3999.12 of the Revised Code	1061
shall be fined not less than ten nor more than one thousand	1062
dollars.	1063

(F) Whoever violates division (F) of section 3999.32,	1064
division (B) of section 3999.36, or section 3999.37 or 3999.38 of	1065
the Revised Code is guilty of a felony of the fourth degree.	1066

(G) Whoever violates division (A) of section 3999.18 of the	1067
Revised Code is guilty of a felony of the fourth degree.	1068

(H) Whoever violates division (B) of section 3999.18 of the	1069
Revised Code is guilty of a misdemeanor of the first degree on a	1070
first offense and a felony of the fifth degree on each subsequent	1071
offense.	1072

(I) If a person is found guilty under this section, the court	1073
may award restitution in accordance with section 2929.18 of the	1074
Revised Code.	1075

Section 2. That existing sections 1739.02, 1739.99, 1751.02,	1076
1751.28, 3901.78, 3905.14, 3917.01, and 3999.99 of the Revised	1077
Code are hereby repealed.	1078