HB 388 -- Insurance Compliance Audits

Sponsor:  Yates

This bill makes privileged any information collected in the
course of an insurance compliance audit.  The information is not
discoverable or admissible as evidence in any legal action,
unless the insurer expressly waives the privilege.  Persons
preparing the audit documents will not be examined in civil,
criminal, or administrative hearings unless the documents are not
privileged.

In a civil, administrative, or criminal proceeding, a court may
order disclosure of materials, after in-camera review, if it is
determined that the privilege was asserted for fraudulent
purposes or that the privilege does not apply.  In a criminal
proceeding, disclosure may be ordered if the material contains
relevant evidence of a crime which is not otherwise available.

The privilege is deemed to be waived by the insurer 30 days after
receiving a request for disclosure of a self-evaluative audit by
a prosecutor or the Attorney General, unless a petition for an
in-camera examination is filed.  After conducting an in-camera
review of the insurance compliance audit document, the court may
require disclosure of any portion of the document it determines
is not privileged.  Any compelled disclosure of an audit will not
make the audit a public document or be deemed a waiver of the
privilege for any other civil, criminal, or administrative
proceeding.

An insurer has the burden of demonstrating the applicability of
the privilege.  The privilege will not apply to information:

(1)  Expressly required to be collected, maintained, or reported
to regulatory agencies pursuant to law;

(2)  Obtained by observation or monitoring by any regulatory
agency;

(3)  Obtained from a source independent of the insurance
compliance audit.

The insurance compliance self-evaluative privilege created in
these sections will apply to all litigation or administrative
proceedings initiated after the effective date of the bill.

Missouri House of Representatives
93rd General Assembly, 1st Regular Session
Last Updated August 25, 2005 at 1:19 pm