| (a) Definitions. The following words and terms when
used in this section have the following meanings unless the context
clearly indicates otherwise.
(1) Agreed upon standards of performance--A set of
standards of performance for each statistical agent which is negotiated
and agreed upon by the statistical agent affected and the department.
For statistical agents already designated as of the effective date
of this section, the standards of performance must be agreed upon
within eight months of the effective date of this section. For statistical
agents designated after the effective date of this section, the standards
of performance must be agreed upon prior to the effective date of
the statistical agent's designation.
(2) Commissioner--Commissioner of Insurance of the
State of Texas.
(3) Department--Texas Department of Insurance.
(4) Designated statistical agent--An organization
duly designated by or contracted with the Commissioner to gather insurance
data from insurers according to a statistical plan.
(5) Statistical plan--A document promulgated by the
Commissioner that specifies the information to be reported, the insurers
who must report the information, and the procedures and format for
the information to be reported to the designated statistical agent.
(b) Each designated statistical agent must comply
with the agreed upon standards of performance.
(c) If, after notice and the opportunity for a hearing,
the Commissioner determines that a designated statistical agent has
failed to comply with the agreed upon standards of performance, the
Commissioner may impose sanctions against the designated statistical
agent under Insurance Code Chapter 82, including but not limited to
an administrative monetary penalty under Insurance Code Chapter 84.
(d) In determining the amount of the administrative
monetary penalty, the Commissioner will consider the following factors
described in this subsection.
(1) The seriousness of the noncompliance, including
the nature, circumstances, extent, and gravity of the noncompliance.
(2) The hazard or potential hazard to the health safety,
or economic welfare of the public created by the noncompliance.
(3) The economic harm to the public's interests or
confidences caused by the noncompliance.
(4) The history of previous noncompliance with performance
standards by the designated statistical agent.
(5) The amount necessary to deter future noncompliance.
(6) The designated statistical agent's efforts to
correct the noncompliance.
(7) Whether the designated statistical agent intentionally
or unintentionally failed to comply with the agreed upon standards
of performance.
(8) Any other consideration that the Commissioner
may deem appropriate.
(e) The amount of the administrative monetary penalty
may not exceed $25,000 for each act of noncompliance.
(f) The department reserves the right to assert any
and all other rights it may have against the statistical agents or
other related parties, including its right to terminate the designation
of a statistical agent, if appropriate.
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