Third Party Administrator Third Party Administrators Alaska Statute 21.27.630 requires that a person who acts as, or represents to be, a Third-Party Administrator (TPA) in this state or relative to a subject resident, located, or to be performed in this state, is licensed in this state. Third-Party Administrator is defined under AS 21.97.900(44) as: (44) “third-party administrator” means a person who, for residents of this state, or for residents of another jurisdiction from a place of business in this state, performs administrative functions including claims administration and payment, marketing administrative functions, premium accounting, premium billing, coverage verification, underwriting authority, or certificate issuance in connection with life insurance, annuities, health insurance, or the provision of coverage for the cost of medical care; Third Party Administrators may apply online with NIPR.com. If you are unable to apply online, you must complete the Third Party Administrator application and submit it to insurancelicensing@alaska.gov. The license fee for a TPA is $2,000; credit card invoices may be requested upon submission of the application to insurancelicensing@alaska.gov A Third Party Administrator must designate a Compliance Officer. Under AS 21.27.650(m) the compliance officer must be licensed. In addition to the requirements set forth in the Insurance Code, the issuance of the license is subject to the requirements of AS 25.27.244 and AS 14.43.148. Applications not completed within four months from the dated filed will be considered withdrawn and a new application and application fees will be required pursuant to AS 21.27.040(f). If you wish to withdraw your application at any time during the application process, please email insurancelicensing@alaska.gov. All fees remitted are nonrefundable pursuant to 3 AAC 31.010. NOTICE: If you meet the definition of a Third-Party Administrator (TPA) but only investigate and adjust claims, you are not required to be licensed as a Third-Party Administrator if you are licensed by the State of Alaska Division of Insurance as an independent adjuster. Workers’ Compensation Claims You may adjust workers’ compensation claims under the casualty authority of an independent adjuster license – no additional license is required. The Alaska Division of Workers’ Compensation administers and enforces the Alaska Workers’ Compensation Act (Act). AS 23.30.030(4) requires an insurer to provide staffed adjusting facilities in Alaska or to retain an independent licensed Alaska resident adjuster with power to effect settlement and make payments within Alaska. The Act may have additional requirements for adjusting workers’ compensation claims. For questions regarding Alaska Workers’ Compensation Act requirements, contact the Alaska Division of Workers’ Compensation at (907) 465-2790. Application Supporting Documents All Third Party Administrators are required to submit the following supporting documentation with their initial application: All basic organizational documents of the Third-Party Administrator, including articles of incorporation, articles of association, articles of organization, partnership agreement, trade name certificate, trust agreement, shareholder agreement and other applicable documents and all endorsements to the required documents. Bylaws, operating agreement, rules, regulations and similar documents regulating the internal affairs of the administrator. The names, mailing addresses, physical addresses, official positions and professional qualifications of persons who are responsible for the conduct of affairs of the Third-Party Administrator, including the members of the board of directors, members of the limited liability company or partnership, board of trustees, executive committee or other governing board or committee, the principal officers in the case of a corporation or the partners or members in the case of a partnership or association, shareholders holding directly or indirectly 10 percent or more of the voting securities of the Third-Party Administrator and any other person who exercises control or influence over the affairs of the Third-Party Administrator. Certified (audited) financial statements for the prior two years prepared by an independent certified public accountant that establish that the applicant is solvent, that the applicant's system of accounting, internal control and procedure is operating effectively to provide reasonable assurance that money is promptly accounted for and paid to the person entitled to the money. If the applicant submits a consolidated statement, a consolidating worksheet for the applicant must also be included. A statement describing the business plan including information on staffing levels and activities proposed in this state and in other jurisdictions and provide details establishing the Third-Party Administrator's capability for providing a sufficient number of experienced and qualified personnel in the areas of claims handling, underwriting, and record keeping. Identify the key personnel who supervise or have responsibility over personnel performing TPA functions. All documents necessary to verify statements contained in or in connection with the application. If this information is not submitted to the NIPR Attachment Warehouse, our office will reach out requesting the information. Supporting documentation can be submitted to insurancelicensing@alaska.gov. Insurer Contracts Under AS 21.27.650(b): “if the insurer is domiciled in this state, or the third-party administrator has a place of business in this state a copy of the contract must be filed and approved by the director at least 30 days before the third party administrator transacts business on behalf of the insurer. If the contract is not required to be approved in advance by the director, the insurer shall provide written notification to the director within 30 days of the entry into or termination of a contract with a third-party administrator; the notice must include a statement of duties to be performed by the third-party administrator on behalf of the insurer, the kinds and classes of insurance for which the third-party administrator has authorization to act, and other information required by the director.” To disclose a contract with the Division, please use the Third Party Administrator Contract Form. Quarterly Filing Alaska Statute 21.27.650(a)(3) requires any Third-Party Administrator operating in Alaska to provide to the Director January 1, April 1, July 1, and October 1 of each year: a list of current employees, identifying those transacting business in this state or upon a subject resident, located, or to be performed in this state; and a list of current insurers under contract. and any other information the Director may require. The completed Third Party Administrator Quarterly form can be submitted to: insurancelicensing@alaska.gov Exempt Third Party Administrators Alaska Insurance Code offers various exemption options under AS 21.27.630(e)-(k). A Third Party Administrator may be exempt if they are: (e) An employee of an admitted insurer, operating under the authority granted by their certificate of authority (g) A credit union or financial institution subject to supervision or examination by federal or state banking authorities. I perform no functions other than advancing premiums to the insurer and collecting debt from the insured. (h) A credit card issuing company that performs no functions, including adjustment or settlement of claims, other than advancing and collecting premiums from its credit card holders who have authorized collection. (i) A person who only provides services to bona fide employee benefit plans that are established by an employer or an employee organization, or both, for which the insurance laws of this state are preempted under the Employee Retirement Income Security Act of 1974, is not required to be additionally licensed as a third-party administrator if the person certifies to the director on or before February 1 of each year its exempt status. (k) An insurer that holds a certificate of authority issued by the director. To apply for the exempt status, you must complete the Third Party Administrator Exempt Application. An Exempt Third Party Administrator cannot apply online. The application should be emailed to insurancelicensing@alaska.gov. A credit card invoice may be requested to pay the $300 application fee. Annual Filling A Third Party Administrator who is exempt under AS 21.27.630(i) should complete the ERISA exemption form on or before February 1 of each year. Failure to submit the annual form will result in cancellation of the license exemption. All other Third Party Administrator’s that qualify for exemption are required to submit the Third Party Administrator Exempt Annual Filing Form on or before February 1 of each year. Failure to submit the annual form will result in cancellation of the license exemption. Both annual filings can be submitted to insurancelicensing@alaska.gov. Notification Requirements Under AS 21.27.640(b)(9)(A)-(C), a Third Party Administrator is required to notify the Division of any changes to the following: (9) notify the director, in writing, not later than 30 days after (A) a change in compliance officer, residence, place of business, mailing address, or phone number; (B) the final disposition of an administrative action taken against the registrant by a governmental agency of another state, by a governmental agency of another jurisdiction, or by a financial industry regulatory authority sanction or arbitration proceeding; in addition, a registrant shall submit to the director documents relating to the final disposition on, including the final order and other relevant legal documents in, the action; or (C) a conviction of a misdemeanor or felony of the third-party administrator, its officers, directors, partners, owners, or employees. Statutes and References Article 4. Third-Party Administrators. AS 21.27.630-AS 21.27.660 Relevant Bulletins B25-09