GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2009
H 2
HOUSE BILL 1166
Committee Substitute Favorable 6/1/09
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Short Title: Insurance Law Changes.‑AB |
(Public) |
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Sponsors: |
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Referred to: |
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April 8, 2009
A BILL TO BE ENTITLED
AN ACT to MAKE VARIOUS CHANGES IN THE LAWS GOVERNING INSURANCE PRODUCERS AND BROKERS, BAIL BONDSMEN, MOTOR CLUBS, PREMIUM FINANCE COMPANIES, AND COLLECTION AGENCIES.
The General Assembly of North Carolina enacts:
SECTION 1. G.S. 58‑33‑10 is amended by adding a new subdivision to read:
"(4a) "FINRA" means the Financial Industry Regulatory Authority or any successor entity."
SECTION 2. G.S. 58‑33‑26(e) reads as rewritten:
"(e) A variable life and variable annuity products
license authorizes a resident agent to sell, solicit, or negotiate variable
contracts if the agent satisfies the Commissioner that the agent has met the National
Association of Securities DealersFINRA requirements of the Secretary
of State of North Carolina."
SECTION 3. G.S. 58‑33‑26(p) reads as rewritten:
"(p) An individual shall not simultaneously hold an
agent'sa property, casualty, or personal lines insurance license and
an adjuster's license in this State. An individual who holds a property and
liabilityproperty, casualty, or personal lines insurance license may
apply for an adjuster license without having to take the adjuster examination
in G.S. 58‑33‑30(e) if the individual applies for the adjuster
license within 60 days after surrendering the property and liabilityproperty,
casualty, or personal lines insurance license. An individual who holds an
adjuster license may apply for a property and liability insurance license
without having to take the property and liability insurance agent examination
in G.S. 58‑33‑30(e) if the individual applies for the property
and liabilityproperty, casualty, or personal lines insurance license
within 60 days after surrendering the adjuster license."
SECTION 4. Article 33 of Chapter 58 of the General Statutes is amended by adding a new section to read:
"§ 58‑33‑48. Criminal history record checks.
(a) An applicant for a license under this Article shall furnish the Commissioner with a complete set of the applicant's fingerprints in a manner prescribed by the Commissioner and a recent passport size full‑face photograph of the applicant. The applicant's fingerprints shall be certified by an authorized law enforcement officer. The fingerprints of every applicant shall be forwarded to the State Bureau of Investigation for a search of the applicant's criminal history record file, if any. If warranted, the State Bureau of Investigation shall forward a set of the fingerprints to the Federal Bureau of Investigation for a national criminal history record check. An applicant shall pay the cost of the State and any national criminal history record check of the applicant.
(b) In addition, if an applicant described in subsection (a) of this section is a corporation, partnership, limited liability company, association, or trust, each key person must furnish the Commissioner a complete set of the applicant's fingerprints and a recent passport size full‑face photograph of the applicant. The applicant's fingerprints shall be certified by an authorized law enforcement officer. The fingerprints of every applicant shall be forwarded to the State Bureau of Investigation for a search of the applicant's criminal history record file, if any. If warranted, the State Bureau of Investigation shall forward a set of the fingerprints to the Federal Bureau of Investigation for a national criminal history record check. An applicant shall pay the cost of the State and any national criminal history record check of the applicant. As used in this subsection, 'key person' means a proposed officer, director, or any other individual who will be in a position to influence the operating decisions of the applicant.
(c) The Commissioner shall keep all information pursuant to this section privileged, in accordance with applicable State law and federal guidelines, and the information shall be confidential and shall not be a public record under Chapter 132 of the General Statutes.
(d) This section does not apply to a person applying for renewal or continuation of a home state insurance producer license or a nonresident insurance producer license."
SECTION 5. G.S. 58‑33‑32(k) reads as rewritten:
"(k) A producer shall report to the Commissioner
any administrative action taken against the producer in another state or by
another governmental agency in this State within 30 days after the final
disposition of the matter. As used in this subsection, "administrative
action" includes enforcement action taken against the producer by the National
Association of Securities Dealers.FINRA. This report shall include a
copy of the order or consent order and other information or documents filed in
the proceeding necessary to describe the action."
SECTION 6. G.S. 58‑33‑35 is repealed.
SECTION 7. G.S. 58‑33‑40(a) reads as rewritten:
"(a) No Except as provided in subsection
(b) of this section, no individual who holds a valid insurance agent's
license issued by the Commissioner shall, either directly or for an insurance
agency, solicit, negotiate, or otherwise act as an agent for an insurer by
which the individual has not been appointed."
SECTION 8. G.S. 58‑33‑40(b) reads as rewritten:
"(b) Any insurer authorized to transact business in
this State may appoint as its agent any individual who holds a valid agent's
license issued by the Commissioner. To appoint an individual as its agent,
the appointing insurer shall file, in a format approved by the Commissioner, a
notice of appointment within 15 days after the date the first insurance
application is submitted. Upon the appointment, theThe
individual shall be authorized to act as an agent for the appointing insurer
for all kinds of insurance for which the insurer is authorized in this State
and for which the appointed agent is licensed in this State, unless
specifically limited."
SECTION 9. G.S. 58‑33‑40(c) and (h) are repealed.
SECTION 10. G.S. 58‑33‑46(a)(2) and (a)(6) read as rewritten:
"§ 58‑33‑46. Suspension, probation, revocation, or nonrenewal of licenses.
(a) The Commissioner may place on probation, suspend, revoke, or refuse to renew any license issued under this Article, in accordance with the provisions of Article 3A of Chapter 150B of the General Statutes, for any one or more of the following causes:
…
(2) Violating any insurance law of this or any other
state, violating any administrative rule, subpoena, or order of the
Commissioner or of another state's insurance regulator, or violating any rule
of the National Association of Securities Dealers.FINRA.
…
(6) Having been convicted of a felony,felony
or a misdemeanor involving dishonesty, a breach of trust, or a
misdemeanor involving moral turpitude."
SECTION 11. G.S. 58‑21‑65(f) reads as rewritten:
"(f) A person licensed as a surplus lines licensee under the laws of a state bordering this State may be licensed as a surplus lines licensee under this Article, if: (i) the laws of the bordering state are substantially similar to the provisions of this Article and (ii) the bordering state has a law or regulation substantially similar to this subsection that permits surplus lines licensees licensed under this Article to be licensed by the bordering state and (iii) the person complies with all requirements of this Article and submits himself or herself to the Commissioner's jurisdiction. Nonresident surplus lines licensees shall be licensed in accordance with Article 33 of this Chapter."
SECTION 12. G.S. 58‑71‑50(a) reads as rewritten:
"(a) An applicant for a license as a bail bondsman or runner shall furnish the Commissioner with a complete set of the applicant's fingerprints in a manner prescribed by the Commissioner and a recent passport size full‑face photograph of the applicant. The applicant's fingerprints shall be certified by an authorized law‑enforcement officer. The fingerprints of every applicant shall be forwarded to the State Bureau of Investigation for a search of the applicant's criminal history record file, if any. If warranted, the State Bureau of Investigation shall forward a set of the fingerprints to the Federal Bureau of Investigation for a national criminal history record check. An applicant shall pay the cost of the State and any national criminal history record check of the applicant."
SECTION 13. G.S. 58‑71‑70 reads as rewritten:
"§ 58‑71‑70. Examination; fees.
Each applicant for a license as a professional bondsman,
surety bondsman, or runner shall appear in person and take a writtenan
examination prepared by the Commissioner testing the applicant's ability and
qualifications. Each applicant is eligible for examination 30 days after the
date the application is received by the Commissioner. If an applicant is
unable to complete the examination requirement within 30 days after
notification from the Commissioner of the applicant's eligibility to take the
examination, the applicant shall again be subject to the criminal history
record check prescribed by G.S. 58‑71‑50(a) so that current
information is available for review with the application. Each examination
shall be held at a time and place as designated by the Commissioner. Each
applicant shall be given notice of the designated time and place no sooner than
15 days before the examination. The Commissioner may contract with a person to
process applications for the examination and administer and grade the
examination in the same manner as for agent examinations under Article 33 of
this Chapter.
The fee for each examination is twenty‑five dollars ($25.00) plus an amount that offsets the cost of any contract for examination services. This examination fee is nonrefundable.
An applicant who fails an examination may take a subsequent examination, but at least one year must intervene between examinations."
SECTION 14. G.S. 58‑71‑45 reads as rewritten:
"§ 58‑71‑45. Terms of licenses.
A license issued to a bail bondsman or to a runner authorizes
the licensee to act in that capacity until the license is suspended or revoked.
Upon the suspension or revocation of a license, the licensee shall return the
license to the Commissioner. A license of a bail bondsman and a license of a
runner shall be renewed on July 1 of each year upon payment of the applicable
renewal fee under G.S. 58‑71‑75. The Commissioner is not
required to print renewal licenses. After notifying the Commissioner in
writing, a professional bondsman who employs a runner may cancel the runner's
license and the runner's authority to act for the professional bondsman."
SECTION 15. G.S. 58‑71‑140(d) is repealed.
SECTION 16. G.S. 58‑71‑120 reads as rewritten:
"§ 58‑71‑120. Bail bondsman to give notice of discontinuance of business; cancellation of license.
Any bail bondsman who discontinues writing bail bonds during
the period for which he the bail bondsman is licensed shall notify
the clerks of the superior court with whom he is registered and return his
the license to the Commissioner for cancellation within 30 days
after such the discontinuance."
SECTION 17. G.S. 58‑70‑40(b) reads as rewritten:
"(b) If an individual proprietor, officer, or partner of the collection agency has been convicted in any court of competent jurisdiction for any crime involving dishonesty or breach of trust, the collection agency shall notify the Commissioner in writing of the conviction within 10 days after the date of the conviction. As used in this subsection, "conviction" includes an adjudication of guilt, a plea of guilty, or a plea of nolo contendere. The conviction by a court of competent jurisdiction of any permittee for a violation of this Article shall automatically have the effect of suspending the permit of that permittee until such time that the permit is reinstated by the Commissioner. As used in this subsection, "conviction" includes an adjudication of guilt, a plea of guilty, and a plea of nolo contendere."
SECTION 18. G.S. 58‑70‑40 is amended by adding a new subsection to read:
"(e) A collection agency shall report to the Commissioner any administrative action taken against the collection agency by another state or by another governmental agency in this State within 30 days after the final disposition of the matter. This report shall include a copy of the order or consent order and other information or documents filed in the proceeding necessary to describe the action."
SECTION 19. Article 35 of Chapter 58 of the General Statutes is amended by adding a new section to read:
"§ 58‑69‑60. Notification of criminal or administrative actions.
(a) If an individual proprietor, officer, or partner of a motor club has been convicted in any court of competent jurisdiction for any crime involving dishonesty or breach of trust, the motor club shall notify the Commissioner in writing of the conviction within 10 days after the date of the conviction. As used in this subsection, "conviction" includes an adjudication of guilt, a plea of guilty, or a plea of nolo contendere.
(b) A motor club shall report to the Commissioner any administrative action taken against the motor club by another state or by another governmental agency in this State within 30 days after the final disposition of the matter. This report shall include a copy of the order or consent order and other information or documents filed in the proceeding necessary to describe the action."
SECTION 20. G.S. 58‑35‑1(2) reads as rewritten:
"(2) "Insurance premium finance agreement"
means a promissory note or other written agreement by which an insured promises
or agrees to pay to, or to the order of, an insurance premium finance company
the amount advanced or to be advanced under the agreement to an insurer or
to an insurance agent, in payment of premiums on an insurance
contract, together with a service charge as authorized and limited by this
Article."
SECTION 21. Article 35 of Chapter 58 of the General Statutes is amended by adding a new section to read:
"§ 58‑35‑22. Notification of criminal or administrative actions.
(a) If an individual proprietor, officer, or partner of an insurance premium finance company has been convicted in any court of competent jurisdiction for any crime involving dishonesty or breach of trust, the premium finance company shall notify the Commissioner in writing of the conviction within 10 days after the date of the conviction. As used in this subsection, "conviction" includes an adjudication of guilt, a plea of guilty, or a plea of nolo contendere.
(b) An insurance premium finance company shall report to the Commissioner any administrative action taken against the premium finance company, including any branch office, by another state or by another governmental agency in this State within 30 days after the final disposition of the matter. This report shall include a copy of the order or consent order and other information or documents filed in the proceeding necessary to describe the action."
SECTION 22. G.S. 58‑2‑69(b) reads as rewritten:
"(b) Every applicant for a license shall inform the
Commissioner of the applicant's residential address.address and
provide the applicant's e‑mail address to which the Commissioner can send
electronic notifications and other messages. Every licensee shall give
written notification to the Commissioner of any change of the licensee's
residential or e‑mail address within 10 business days after the
licensee moves into the licensee's new residence.residence or obtains
a different e‑mail address. This requirement applies if the change of
residential address is by governmental action and there has been no actual
change of residence location; in which case the licensee shall notify the
Commissioner within 10 business days after the effective date of the change. A
violation of this subsection is not a ground for revocation, suspension, or
nonrenewal of the license or for the imposition of any other penalty by the
Commissioner, though a licensee who violates this subsection shall pay an
administrative fee of fifty dollars ($50.00) to the Commissioner."
SECTION 23. Sections 17, 18, 19, and 21 of this act become effective October 1, 2009. Section 22 of this act becomes effective January 1, 2010. Section 4 of this act becomes effective October 1, 2010, and applies to applications made on or after that date. The remainder of this act is effective when it becomes law.