Citations Affected: IC 27-1-15.5.
Synopsis: Insurance agent licensure. Provides that a license issued to
an insurance agent, a limited insurance representative, a surplus lines
insurance agent, or a consultant must be renewed every 48 months
(instead of every 24 months). Removes the requirement for an affidavit
from an agent who requests a duplicate license due to loss, theft, or
destruction of a license. Makes conforming amendments.
Effective: July 1, 2000.
January 10, 2000, read first time and referred to Committee on Insurance, Corporations and
A BILL FOR AN ACT to amend the Indiana Code concerning
licensee is unable to procure the amount of insurance desired from
insurers authorized and licensed to transact business in Indiana. The
commissioner may issue a limited insurance representative's license to
the following without examination:
(1) a person who is a ticket-selling agent of a common carrier who will act only with reference to the issuance of insurance on personal effects carried as baggage, in connection with the transportation provided by such common carrier;
(2) a person who will only negotiate or solicit limited travel accident insurance in transportation terminals;
(3) a person who will only negotiate or solicit insurance covered by IC 27-8-4 ;
(4) a person who will only negotiate or solicit insurance under Class II(j); or
(5) to any person who will negotiate or solicit a kind of insurance that the commissioner finds does not require an examination to demonstrate professional competency.
(b) A corporation or limited liability company may be licensed as an insurance agent, surplus lines insurance agent, or limited insurance representative. Every officer, director, stockholder, or employee of the corporation or limited liability company personally engaged in Indiana in soliciting or negotiating policies of insurance shall be registered with the commissioner as to its license, and each such member, officer, director, stockholder, or employee shall also qualify as an individual licensee. However, this section does not apply to a management association, partnership, or corporation whose operations do not entail the solicitation of insurance from the public.
(c) The commissioner may not grant, renew, continue or permit to continue any license if he finds that the license is being or will be used by the applicant or licensee for the purpose of writing controlled business. "Controlled business" means:
(1) insurance written on the interests of the licensee or those of his immediate family or of his employer; or
(2) insurance covering himself or members of his immediate family or a corporation, limited liability company, association, or partnership, or the officers, directors, substantial stockholders, partners, members, managers, employees of such a corporation, limited liability company, association, or partnership, of which he is or a member of his immediate family is an officer, director, substantial stockholder, partner, member, manager, associate, or employee.
However, this section does not apply to insurance written or interests
insured in connection with or arising out of credit transactions. Such a
license shall be deemed to have been or intended to be used for the
purpose of writing controlled business, if the commissioner finds that
during any twelve (12) month period the aggregate commissions earned
from such controlled business has exceeded twenty-five percent (25%)
of the aggregate commission earned on all business written by such
applicant or licensee during the same period.
(d) An insurer, insurance agent, surplus lines insurance agent, or limited insurance representative may not pay any commission, brokerage, or other valuable consideration to any person for services as an insurance agent, surplus lines insurance agent, or limited insurance representative within Indiana, unless the person held, at the time the services were performed, a valid license for that kind of insurance as required by the laws of Indiana for such services. A person, other than a person duly licensed by the state of Indiana as an insurance agent, surplus lines insurance agent, or limited insurance representative, may not, at the time such services were performed, accept any such commission, brokerage, or other valuable consideration. However, any such person duly licensed under this chapter may:
(1) pay or assign his commissions or direct that his commissions be paid:
(A) to a partnership of which he is a member, an employee, or an agent; or
(B) to a corporation of which he is an officer, employee, or agent; or
(2) pay, pledge, assign, or grant a security interest in the person's commission to a lending institution as collateral for a loan if the payment, pledge, assignment, or grant of a security interest is not, directly or indirectly, in exchange for insurance services performed.
This section shall not prevent payment or receipt of renewal or other deferred commissions to or by any person entitled thereto under this section.
(e) The license shall state the name and resident address of the licensee, date of issue, the renewal or expiration date, the line or lines of insurance covered by the license, and such other information as the commissioner considers proper for inclusion in the license.
(f) All licenses issued under this chapter shall continue in force
longer than twenty-four (24) for forty-eight (48) months. The
insurance department shall establish procedures for the renewal of
licenses. A license may be renewed after it expires as follows:
(1) A person who applies for a license renewal not more than
twenty-four (24) months after the person's license expires must:
(A) satisfy the requirements of IC 27-1-15.5-7.1 (b); and
(B) pass to the department's satisfaction the laws portion of the examination required of an applicant under IC 27-1-15.5-4 (g)(5) for the type of license for which the person seeks renewal.
(2) A person who applies for a license renewal more than twenty-four (24) months after it expires must successfully complete the education requirements of IC 27-1-15.5-4 (e) and pass to the department's satisfaction the examination required of an applicant for the type of license for which the person seeks renewal.
All license renewals must be accompanied by payment of the renewal fee as provided in section 4(d) of this chapter.
(g) A license as an insurance agent, surplus lines insurance agent, or limited insurance representative may not be required of the following:
(1) Any regular salaried officer or employee of an insurance company, or of a licensed insurance agent, surplus lines insurance agent, or limited insurance representative if such officer or employee's duties and responsibilities do not include the negotiation or solicitation of insurance.
(2) Persons who secure and furnish information for the purpose of group or wholesale life insurance, or annuities, or group, blanket, or franchise health insurance, or for enrolling individuals under such plans or issuing certificates thereunder or otherwise assisting in administering such plans, where no commission is paid for such service.
(3) Employers or their officers or employees, or the trustees of any employee trust plan, to the extent that such employers, officers, employees, or trustees are engaged in the administration or operation of any program of employee benefits for their own employees or the employees of their subsidiaries or affiliates involving the use of insurance issued by a licensed insurance company, provided that such employers, officers, employees, or trustees are not in any manner compensated, directly or indirectly, by the insurance company issuing such insurance.
(h) An insurer shall require that a person who, on behalf of the insurer, makes any oral, written, or electronic communication with an individual regarding insurance coverage, rates, benefits, or policy terms, for the purpose of soliciting insurance shall be licensed under this chapter.
services. A copy of the agreement shall be available to the
commissioner. In the absence of an agreement on the consultant's fee,
the consultant shall not be entitled to recover a fee in any action at law
or in equity.
(d) No individual or corporation may concurrently hold a consultant's license and an insurance agent's, surplus lines insurance agent's, or limited insurance representative's license at any time.
(e) No licensed consultant may employ, be employed by, or be in partnership with, nor receive any remuneration whatsoever, from any licensed insurance agent, surplus lines insurance agent, or limited insurance representative, or insurer, except that a consultant may be compensated by an insurer for providing consulting services to the insurer.
(f) Such license shall be valid for
not longer than twenty-four (24)
forty-eight (48) months and may be renewed and extended in the same
manner as an insurance agent's license. The commissioner shall
designate on the license those consulting services which the licensee
is entitled to perform.
(g) All requirements and standards relating to the denial, revocation or suspension of an insurance agent's license, including penalties, shall apply to the denial, revocation and suspension of an insurance consultant's license as nearly as practicable.
(h) A consultant is obligated under his license to serve with objectivity and complete loyalty solely the insurance interests of his client and to render his client such information, counsel, and service as within the knowledge, understanding, and opinion, in good faith of the licensee, best serves the client's insurance needs and interests.
license, loss or destruction of license. (a) The commissioner shall
promptly notify all appointing insurers, where applicable, and the
licensee regarding any suspension, revocation, or termination of license
by the commissioner.
(b) Upon suspension, revocation, or termination of the license of a resident of Indiana, the commissioner shall notify the central office of the National Association of Insurance Commissioners and the insurance commissioner of each state for whom he has executed a certificate as provided for in section 4 of this chapter.
(c) Upon suspension, revocation, or termination of a license, the licensee shall forthwith deliver it to the commissioner by personal delivery or by mail.
(d) Any licensee who ceases to maintain his residency in Indiana (as defined in section 4 of this chapter) shall deliver his insurance license to the commissioner by personal delivery or by mail within thirty (30) days after terminating said residency.
(e) The commissioner may issue a duplicate license for any lost, stolen, or destroyed license issued pursuant to this chapter.
affidavit of the licensee prescribed by the commissioner concerning the
facts of such loss, theft, or destruction. The fee charged by the
commissioner for the issuance of a duplicate:
(1) insurance agent license;
(2) surplus lines insurance agent license;
(3) limited insurance representative license; or
(4) consultant license;
may not exceed ten dollars ($10).