PURPOSE: This rule implements the purposes of section 374.185, RSMo, and establishes uniform standards for the division utilizing market analysis to evaluate the market conduct of insurers and to develop cause for issuance of an examination warrant pursuant to sections 374.202 to 374.207, RSMo.

1. (1) The division will apply the following standards in utilizing market analysis:

   1. (A) The division will gather information from data currently available to the division;
   2. (B) Such information will be analyzed in order to develop a baseline understanding of the marketplace and to identify for further review insurers or practices that deviate significantly from the norm or that may pose a potential risk to the insurance consumer; and AND INSURANCE
   3. (C) The NAIC Market Regulation Handbook, and other handbooks adopted by the NAIC, will be used by the division as a guide in performing this analysis.

2. (2) If the analysis supports further investigation or review by the division into a particular insurer or practice, the following continuum of market conduct actions may be considered prior to conducting an on-site examination. These actions may include, but are not limited to the following:

   1. (A) Correspondence with insurer;
   2. (B) Insurer interviews;
   3. (C) Information gathering;
   4. (D) Policy and procedure reviews;
   5. (E) Interrogatories;
   6. (F) Review of insurer self-evaluation, if not subject to a privilege of confidentiality, and compliance programs, including membership in a best-practice organization; and
   7. (G) Desk examinations.
3. (3) The director will select a market conduct action that is cost effective for the department and the insurer or company, while still protecting the insurance consumer.
4. (4) Any such materials or documents reviewed by the division pursuant to section
5. (2) of this rule are confidential in accordance with the provisions of sections 374.071 and 374.205.4, RSMo.
6. (5) The division will take those steps reasonably necessary to eliminate requests for information that duplicate information provided as part of an insurer’s annual financial statement, the annual NAIC market conduct statement, or other schedules, surveys, or reports regularly submitted to the director, unless the information is state specific.
7. (6) Market conduct actions taken as a result of a market analysis will focus on the general business practices and compliance activities of insurers rather than identifying infrequent or unintentional random errors that do not cause significant consumer harm.
8. (7) The insurer may be given an opportunity to resolve matters that arise as a result of a market analysis to the satisfaction of the director before any additional market conduct actions are taken against the insurer.

AUTHORITY: sections 374.045, 374.185, 374.190, and 374.202–374.207, RSMo 2016.* Original rule filed April 1, 2008, effective Nov. 30, 2008. Amended: Filed Dec. 13, 2018, effective July 30, 2019. *Original authority: 374.045, RSMo 1967, amended 1993, 1995, 2008; 374.185, RSMo 2007, amended 2016; 374.190, RSMo 1939, amended 1949, 1967, 1992; and 374.202–374.207, see Revised Statutes of Missouri.