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H0035aa,aaS..................................................by MR. SPEAKER
Requested by: Department of Insurance
INSURANCE PRODUCER LICENSES - Repeals, amends and adds to existing law to
provide for licensure for insurance producers; to provide a public records
exemption for records furnished to the Department of Insurance regarding
termination of appointment, employment, contract or other insurance
business relationship between an insurer and a producer; to provide for
purpose and scope; to provide definitions; to require licensure and to
provide exceptions; to provide for application for examinations; to provide
for producer licenses and nonresident producer licenses; to provide for
service of process for nonresident producers; to provide for issuance of
and refusal to issue licenses; to provide for exemption from examination;
to provide for continuation and expiration of licenses; to provide for
continuing education; to provide for notification of use of assumed names;
to provide for temporary licenses; to provide for administrative penalties,
suspensions, revocations and refusals of licenses; to provide for
commissions and appointments; to provide notification to director of
termination; to provide for reciprocity; to provide for reporting of
actions; to provide that insurers must accept business through licensed
producers; to provide for countersignature of policies; to provide for
power of attorney; to provide for reporting and accounting for premiums; to
provide that the director of the department may promulgate rules; to
provide for procedures following suspension, revocation or refusal to
continue a license; to provide for reinstatement and return of licenses; to
provide for inactive status; and to provide that service corporations may
file appointment of agents or representatives.
01/08 House intro - 1st rdg - to printing
Rpt prt - to Bus
02/22 Rpt out - to Gen Ord
02/28 Rpt out amen - to engros
03/01 Rpt engros - 1st rdg - to 2nd rdg as amen
03/02 2nd rdg - to 3rd rdg as amen
03/05 3rd rdg as amen - PASSED - 65-2-3
AYES -- Barraclough, Barrett, Bedke, Bell, Bieter, Black, Boe, Bolz,
Bradford, Bruneel, Callister, Campbell, Chase, Clark, Collins, Crow,
Cuddy, Deal, Denney, Ellis, Ellsworth, Eskridge, Field(13),
Field(20), Gagner, Gould, Hadley, Hammond, Harwood, Henbest,
Hornbeck, Jaquet, Jones, Kellogg, Kendell, Kunz, Lake, Langford,
Loertscher, Mader, Marley, Meyer, Montgomery, Mortensen, Moss, Moyle,
Pearce, Pischner, Pomeroy, Ridinger, Roberts, Robison, Sali, Sellman,
Shepherd, Smith, Smylie, Stevenson, Stone, Swan, Tilman, Trail, Wood,
Young, Mr. Speaker
NAYS -- McKague, Schaefer
Absent and excused -- Higgins, Raybould, Wheeler
Floor Sponsor -- Deal
Title apvd - to Senate
03/06 Senate intro - 1st rdg - to Com/HuRes
03/12 Rpt out - to 14th Ord
03/15 Rpt out amen - to 1st rdg as amen
03/16 1st rdg - to 2nd rdg as amen
03/19 2nd rdg - to 3rd rdg as amen
03/20 3rd rdg as amen - PASSED - 35-0-0
AYES -- Andreason, Branch, Boatright, Brandt, Bunderson, Burtenshaw,
Cameron, Danielson, Darrington, Davis, Deide, Dunklin, Frasure,
Geddes, Goedde, Hawkins, Ingram, Ipsen, Keough, King-Barrutia, Lee,
Lodge, Noh, Richardson, Risch, Sandy, Schroeder, Sims, Sorensen,
Stegner, Stennett, Thorne, Wheeler, Whitworth, Williams,
NAYS -- None
Absent and excused -- None
Floor Sponsor -- Ipsen
Title apvd - to House
03/21 House concurred in Senate amens - to engros
03/22 1st rdg - to 2nd rdg as amen
03/23 2nd rdg - to 3rd rdg as amen
03/28 3rd rdg as amen - PASSED - 64-1-5
AYES -- Barraclough, Barrett, Bedke, Bell, Bieter, Black, Boe, Bolz,
Bradford, Callister, Campbell, Chase, Clark, Collins, Crow, Cuddy,
Deal, Denney, Ellis, Ellsworth, Eskridge, Field(13), Field(20),
Gagner, Gould, Hadley, Hammond, Hansen, Harwood, Henbest(Farley),
Higgins, Hornbeck, Jaquet, Jones, Kellogg, Kendell, Kunz, Lake,
Langford, Mader, Meyer, Montgomery, Mortensen, Moss, Moyle, Pearce,
Pischner, Pomeroy, Raybould, Ridinger, Roberts, Robison, Sali,
Schaefer, Sellman, Shepherd, Smylie, Stone, Tilman, Trail, Wheeler,
Wood, Young(Young), Mr. Speaker
NAYS -- McKague
Absent and excused -- Bruneel, Loertscher, Marley, Smith, Stevenson
Floor Sponsor -- Deal
Title apvd - to enrol
03/29 Rpt enrol - Sp signed - Pres signed
03/30 To Governor
04/02 Governor signed
Session Law Chapter 296
Effective: 07/01/01
|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-sixth Legislature First Regular Session - 2001IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 35 BY MR. SPEAKER Requested by: Department of Insurance 1 AN ACT 2 RELATING TO INSURANCE PRODUCER AND INSURANCE CONSULTANT LICENSING; AMENDING 3 SECTION 9-340B, IDAHO CODE, TO CREATE A PUBLIC RECORDS EXEMPTION FOR 4 RECORDS FURNISHED TO THE DEPARTMENT OF INSURANCE REGARDING TERMINATION OF 5 AN APPOINTMENT, EMPLOYMENT, CONTRACT OR OTHER INSURANCE BUSINESS RELATION- 6 SHIP BETWEEN AN INSURER AND A PRODUCER; REPEALING CHAPTER 10, TITLE 41, 7 IDAHO CODE; AMENDING TITLE 41, IDAHO CODE, BY THE ADDITION OF A NEW CHAP- 8 TER 10, TITLE 41, IDAHO CODE, TO PROVIDE FOR PURPOSE AND SCOPE, TO PROVIDE 9 FOR MEANING OF TERMS, TO PROVIDE FOR DEFINITIONS, TO PROVIDE FOR REQUIRE- 10 MENT OF LICENSES, TO PROVIDE FOR EXCEPTIONS TO LICENSING, TO PROVIDE FOR 11 APPLICATIONS FOR EXAMINATIONS, TO PROVIDE FOR APPLICATIONS FOR PRODUCER 12 LICENSES, TO PROVIDE FOR PRODUCER LICENSES, TO PROVIDE FOR NONRESIDENT 13 PRODUCER LICENSES, TO PROVIDE FOR SERVICE OF PROCESS FOR NONRESIDENT PRO- 14 DUCERS AND CONSULTANTS, TO PROVIDE FOR ISSUANCE OF AND REFUSAL TO ISSUE 15 LICENSES, TO PROVIDE FOR EXEMPTION FROM EXAMINATION, TO PROVIDE FOR CON- 16 TINUATION AND EXPIRATION OF LICENSES AND FOR CONTINUING EDUCATION, TO PRO- 17 VIDE FOR NOTIFICATION OF USE OF ASSUMED NAMES, TO PROVIDE FOR TEMPORARY 18 LICENSING, TO PROVIDE FOR ADMINISTRATIVE PENALTIES, SUSPENSIONS, 19 REVOCATIONS AND REFUSALS OF LICENSES, TO PROVIDE FOR COMMISSIONS, TO PRO- 20 VIDE FOR APPOINTMENTS, TO PROVIDE FOR NOTIFICATION TO DIRECTOR OF TERMINA- 21 TION, TO PROVIDE FOR RECIPROCITY, TO PROVIDE FOR REPORTING OF ACTIONS, TO 22 PROVIDE THAT INSURERS MUST ACCEPT BUSINESS THROUGH LICENSED PRODUCERS 23 ONLY, TO PROVIDE FOR COUNTERSIGNATURE OF POLICIES AND FOR GRANTING OF 24 POWER OF ATTORNEY, TO PROVIDE FOR REPORTING AND ACCOUNTING FOR PREMIUMS, 25 TO PROVIDE FOR REQUIREMENT OF CONSULTANT LICENSING, TO PROVIDE FOR EXEMP- 26 TIONS TO CONSULTANT LICENSING, TO PROVIDE QUALIFICATIONS FOR RESIDENT CON- 27 SULTANT LICENSES, TO PROVIDE FOR NONRESIDENT CONSULTANT LICENSES, TO PRO- 28 VIDE FOR CLASSES OF INSURANCE FOR CONSULTANTS, TO PROVIDE FOR DISCLOSURE 29 BY CONSULTANTS, TO PROVIDE FOR ERRORS AND OMISSIONS INSURANCE, TO PROVIDE 30 THAT THE DIRECTOR MAY PROMULGATE RULES, TO PROVIDE FOR PROCEDURE FOLLOWING 31 SUSPENSION, REVOCATION OR REFUSAL TO CONTINUE A LICENSE AND FOR REINSTATE- 32 MENT, TO PROVIDE FOR RETURN OF LICENSES, TO PROVIDE FOR INACTIVE STATUS 33 AND TO PROVIDE THAT THE PROVISIONS OF THE CHAPTER ARE SEVERABLE; AMENDING 34 SECTION 41-1108, IDAHO CODE, TO PROVIDE CORRECT REFERENCES AND CODE CITA- 35 TIONS; AMENDING SECTION 41-1223, IDAHO CODE, TO PROVIDE CORRECT TERMINOL- 36 OGY; AMENDING SECTION 41-1315A, IDAHO CODE, TO DELETE A REFERENCE TO A 37 CODE CITATION AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 41-3435, 38 IDAHO CODE, TO PROVIDE CORRECT TERMINOLOGY, TO PROVIDE THAT SERVICE CORPO- 39 RATIONS MAY FILE APPOINTMENT OF AGENTS OR REPRESENTATIVES, TO PROVIDE A 40 CORRECT CODE CITATION AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 41 41-4703, IDAHO CODE, TO REVISE A DEFINITION AND TO MAKE TECHNICAL CORREC- 42 TIONS; AMENDING SECTION 41-4933, IDAHO CODE, TO PROVIDE CORRECT CODE CITA- 43 TIONS; AMENDING SECTION 41-5203, IDAHO CODE, TO REVISE A DEFINITION AND TO 44 MAKE TECHNICAL CORRECTIONS; AND AMENDING SECTION 41-5501, IDAHO CODE, TO 45 REVISE A DEFINITION AND TO MAKE A TECHNICAL CORRECTION. 2 1 Be It Enacted by the Legislature of the State of Idaho: 2 SECTION 1. That Section 9-340B, Idaho Code, be, and the same is hereby 3 amended to read as follows: 4 9-340B. RECORDS EXEMPT FROM DISCLOSURE -- LAW ENFORCEMENT RECORDS, INVES- 5 TIGATORY RECORDS OF AGENCIES, WORKER'S COMPENSATION. The following records are 6 exempt from disclosure: 7 (1) Investigatory records of a law enforcement agency, as defined in sec- 8 tion 9-337(6), Idaho Code, under the conditions set forth in section 9-335, 9 Idaho Code. 10 (2) Juvenile records of a person maintained pursuant to chapter 5, title 11 20, Idaho Code, except that facts contained in such records shall be furnished 12 upon request in a manner determined by the court to persons and governmental 13 and private agencies and institutions conducting pertinent research studies or 14 having a legitimate interest in the protection, welfare and treatment of the 15 juvenile who is thirteen (13) years of age or younger. If the juvenile is 16 petitioned or charged with an offense which would be a criminal offense if 17 committed by an adult, the name, offense of which the juvenile was petitioned 18 or charged and disposition of the court shall be subject to disclosure as pro- 19 vided in section 20-525, Idaho Code. Additionally, facts contained in any 20 records of a juvenile maintained under chapter 5, title 20, Idaho Code, shall 21 be furnished upon request to any school district where the juvenile is 22 enrolled or is seeking enrollment. 23 (3) (a) Until July 1, 2001, records of the department of correction to 24 the extent that disclosure thereof would interfere with the secure and 25 orderly conduct of their operations, or the rehabilitation of any person 26 in the custody of the department of correction, or would substantially 27 prejudice or prevent the carrying out of the functions of the department 28 of correction if the public interest in confidentiality clearly outweighs 29 the public interest in disclosure. Records exempt from disclosure shall 30 include, but not be limited to, those containing the names and addresses 31 of witnesses or victims or those containing information identifying vic- 32 tims or witnesses. 33 (b) Operation and security manuals, plans or codes of county jails and 34 buildings owned or leased by Idaho state government, a county or a city. 35 "Operation manuals" are those internal documents of any state government 36 agency, county or city building or jail that define the procedures uti- 37 lized to maintain security within the building or jail. "Plans or codes" 38 relate only to those documents, the release of which could jeopardize the 39 safety of workers in those buildings, or adversely affect the public 40 safety. 41 (c) Records of the commission of pardons and parole shall be exempt from 42 public disclosure pursuant to section 20-213A, Idaho Code, and section 43 20-223, Idaho Code. Records exempt from disclosure shall also include 44 those containing the names, addresses and written statements of victims. 45 (4) Voting records of the sexual offender classification board. In accor- 46 dance with section 18-8315, Idaho Code, the written record of the vote to 47 classify an offender as a violent sexual predator by each board member in each 48 case reviewed by that board member shall be exempt from disclosure to the pub- 49 lic and shall be made available upon request only to the governor, the chair- 50 man of the senate judiciary and rules committee, and the chairman of the house 51 of representatives judiciary, rules and administration committee, for all law- 52 ful purposes. 53 (5) Records of the sheriff or Idaho state police received or maintained 3 1 pursuant to section 18-3302, Idaho Code, relating to an applicant or licensee. 2 (6) Records of investigations prepared by the department of health and 3 welfare pursuant to its statutory responsibilities dealing with the protection 4 of children, the rehabilitation of youth, adoptions and the commitment of men- 5 tally ill persons. 6 (7) Records including, but not limited to, investigative reports, result- 7 ing from investigations conducted into complaints of discrimination made to 8 the Idaho human rights commission unless the public interest in allowing 9 inspection and copying of such records outweighs the legitimate public or pri- 10 vate interest in maintaining confidentiality of such records. A person may 11 inspect and copy documents from an investigative file to which he or she is a 12 named party if such documents are not otherwise prohibited from disclosure by 13 federal law or regulation or state law. The confidentiality of this subsection 14 will no longer apply to any record used in any judicial proceeding brought by 15 a named party to the complaint or investigation, or by the Idaho human rights 16 commission, relating to the complaint of discrimination. 17 (8) Records containing information obtained by the manager of the Idaho 18 state insurance fund pursuant to chapter 9, title 72, Idaho Code, from or on 19 behalf of employers or employees contained in underwriting and claims for ben- 20 efits files. 21 (9) The worker's compensation records of the Idaho industrial commission 22 provided that the industrial commission shall make such records available: 23 (a) To the parties in any worker's compensation claim and to the indus- 24 trial special indemnity fund of the state of Idaho; or 25 (b) To employers and prospective employers subject to the provisions of 26 the Americans with disabilities act, 42 U.S.C. 12112, or other statutory 27 limitations, who certify that the information is being requested with 28 respect to a worker to whom the employer has extended an offer of employ- 29 ment and will be used in accordance with the provisions of the Americans 30 with disabilities act, 42 U.S.C. 12112, or other statutory limitations; or 31 (c) To employers and prospective employers not subject to the provisions 32 of the Americans with disabilities act, 42 U.S.C. 12112, or other statu- 33 tory limitations, provided the employer presents a written authorization 34 from the person to whom the records pertain; or 35 (d) To others who demonstrate that the public interest in allowing 36 inspection and copying of such records outweighs the public or private 37 interest in maintaining the confidentiality of such records, as determined 38 by a civil court of competent jurisdiction. 39 (10) Records of investigations compiled by the commission on aging involv- 40 ing vulnerable adults, as defined in section 18-1505, Idaho Code, alleged to 41 be abused, neglected or exploited. 42 (11) Criminal history records and fingerprints, as defined by section 43 67-3001, Idaho Code, and compiled by the Idaho state police. Such records 44 shall be released only in accordance with chapter 30, title 67, Idaho Code. 45 (12) Records furnished or obtained pursuant to section 41-1019, Idaho 46 Code, regarding termination of an appointment, employment, contract or other 47 insurance business relationship between an insurer and a producer. 48 SECTION 2. That Chapter 10, Title 41, Idaho Code, be, and the same is 49 hereby repealed. 4 1 SECTION 3. That Title 41, Idaho Code, be, and the same is hereby amended 2 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap- 3 ter 10, Title 41, Idaho Code, and to read as follows: 4 CHAPTER 10 5 PRODUCER AND CONSULTANT LICENSING 6 41-1001. PURPOSE AND SCOPE. (1) This chapter governs the qualifications 7 and procedures for the licensing of insurance producers. It simplifies and 8 organizes statutory language to improve efficiency, permits the use of new 9 technology and reduces costs associated with issuing and renewing insurance 10 licenses. 11 (2) This chapter applies to adjusters to the extent provided in section 12 41-1108, Idaho Code, and to surplus lines brokers to the extent provided in 13 sections 41-1223 and 41-1224, Idaho Code. Except where expressly made applica- 14 ble, this chapter does not apply to title insurance under chapter 27, title 15 41, Idaho Code. 16 41-1002. TERMS CONSTRUED. Wherever the terms "agent" or "broker" appear 17 in title 41, Idaho Code, or in the rules of the department, they shall be 18 understood and construed to mean "producer" as defined in section 41-1003(9), 19 Idaho Code, except as used in section 41-1018, Idaho Code, and any other sec- 20 tions where it is apparent from the language that the terms should not be so 21 construed. 22 41-1003. DEFINITIONS. (1) "Business entity" means a corporation, associa- 23 tion, partnership, limited liability company, limited liability partnership or 24 other legal entity. 25 (2) "Consultant" means a person required to be licensed under the laws of 26 this state to advise, offer to advise, counsel or provide information or ser- 27 vice to another regarding existing or prospective insurance for compensation 28 other than from the insurer. 29 (3) "Home state" means the District of Columbia and any state or terri- 30 tory of the United States or any province of Canada in which an insurance pro- 31 ducer maintains his or her principal place of residence or principal place of 32 business and is licensed to act as an insurance producer. 33 (4) "License" means a document issued by the director authorizing a per- 34 son to act as an insurance producer for the lines of authority specified in 35 the document. The license itself does not create any authority, actual, appar- 36 ent or inherent, in the holder to represent or commit an insurance carrier. 37 (5) "Limited lines insurance" is insurance which restricts the authority 38 of the license to less than the total authority prescribed in the associated 39 major lines pursuant to section 41-1008(1)(a) through (g), Idaho Code, and 40 shall include, but not be limited to: credit life, credit disability, credit 41 property, credit unemployment, involuntary unemployment, mortgage life, mort- 42 gage guaranty, mortgage disability, guaranteed automobile protection (GAP) 43 insurance, transportation baggage insurance, transportation ticket policies 44 covering personal accident insurance, pet insurance, or any other line of 45 insurance that the director deems necessary to recognize for the purposes of 46 complying with section 41-1009(5), Idaho Code. 47 (6) "Limited lines producer" means a producer authorized by the director 48 to sell, solicit or negotiate limited lines insurance. 49 (7) "Negotiate" means the act of conferring directly with or offering 50 advice directly to a purchaser or prospective purchaser of a particular con- 51 tract of insurance concerning any of the substantive benefits, terms or condi- 5 1 tions of the contract, provided that the person engaged in the act either 2 sells insurance or obtains insurance from insurers for purchasers. 3 (8) "Person" means an individual or a business entity. 4 (9) "Producer" means a person required to be licensed under the laws of 5 this state to sell, solicit or negotiate insurance. 6 (10) "Resident" means a person whose home state is Idaho or any other par- 7 ticular state identified in conjunction with the use of the term. 8 (11) "Sell" means to exchange a contract of insurance by any means, for 9 money or its equivalent, on behalf of an insurance company. 10 (12) "Solicit" means attempting to sell insurance or asking or urging a 11 person to apply for a particular kind of insurance from a particular company 12 or companies. 13 (13) "Terminate" means the cancellation of the relationship between an 14 insurance producer and the insurer or the termination of a producer's author- 15 ity to transact insurance for or on behalf of an insurer. 16 (14) "Uniform application" means the current version of the national asso- 17 ciation of insurance commissioners (NAIC) uniform application for resident and 18 nonresident producer licensing. 19 (15) "Uniform business entity application" means the current version of 20 the NAIC uniform business entity application for resident and nonresident 21 business entities. 22 41-1004. LICENSE REQUIRED. A person shall not sell, solicit or negotiate 23 insurance in this state for any class or classes of insurance unless the per- 24 son is licensed as a producer for that line of authority in accordance with 25 this chapter. 26 41-1005. EXCEPTIONS TO LICENSING. (1) Nothing in this chapter shall be 27 construed to require an insurer to obtain an insurance producer license. In 28 this section, the term "insurer" does not include an insurer's officers, 29 directors, employees, subsidiaries or affiliates. 30 (2) A license as an insurance producer shall not be required of the fol- 31 lowing: 32 (a) An officer, director or employee of an insurer or of an insurance 33 producer, provided that the officer, director or employee does not receive 34 any commission on policies written or sold to insure risks residing, 35 located or to be performed in this state and: 36 (i) The activities of the officer, director or employee are execu- 37 tive, administrative, managerial, clerical or a combination of these, 38 and are only indirectly related to the sale, solicitation or negotia- 39 tion of insurance; or 40 (ii) The function of the officer, director or employee relates to 41 underwriting, loss control, inspection or the processing, adjusting, 42 investigating or settling of a claim on a contract of insurance; or 43 (iii) The officer, director or employee is acting in the capacity of 44 a special agent or agency supervisor assisting insurance producers 45 where the person's activities are limited to providing technical 46 advice and assistance to licensed insurance producers and do not 47 include the sale, solicitation or negotiation of insurance; 48 (b) A person who secures and furnishes information for the purpose of 49 group life insurance, group property and casualty insurance, group annu- 50 ities, group or blanket accident and health insurance, or for the purpose 51 of enrolling individuals under plans, issuing certificates under plans or 52 otherwise assisting in administering plans, or performs administrative 53 services relating to mass-marketed property and casualty insurance, and 6 1 who does not receive a commission; 2 (c) An employer or association or its officers, directors, employees or 3 the trustees of an employee trust plan, to the extent that the employer, 4 association, officer, employee, director or trustee is engaged in the 5 administration or operation of a program of employee benefits for the 6 employer's or association's own employees or the employees of its subsid- 7 iaries or affiliates, which involves the use of insurance issued by an 8 insurer, as long as the employer, association, officer, director, employee 9 or trustee is not in any manner compensated, directly or indirectly, by 10 the company issuing the contracts; 11 (d) Employees of insurers or organizations employed by insurers who are 12 engaging in the inspection, rating or classification of risks, or in the 13 supervision of the training of insurance producers, and who are not indi- 14 vidually engaged in the sale, solicitation or negotiation of insurance, 15 and who do not receive a commission; 16 (e) A person whose activities in this state are limited to advertising 17 without the intent to solicit insurance in this state through communica- 18 tions in printed publications or other forms of electronic mass media 19 whose distribution is not limited to residents of the state, provided that 20 the person does not sell, solicit or negotiate insurance that would insure 21 risks residing, located or to be performed in this state; 22 (f) A person who is not a resident of this state who sells, solicits or 23 negotiates a contract of insurance for commercial property and casualty 24 risks to an insured with risks located in more than one (1) state insured 25 under that contract, provided that the person is otherwise licensed as an 26 insurance producer to sell, solicit or negotiate that insurance in the 27 state where the insured maintains its principal place of business and the 28 contract of insurance insures risks located in that state; 29 (g) A salaried full-time employee who counsels or advises his or her 30 employer relative to the insurance interests of the employer or of the 31 subsidiaries or business affiliates of the employer, provided that the 32 employee does not sell or solicit insurance or receive a commission; or 33 (h) A person who, concurrent with the rental of a motor vehicle, provides 34 contract options to the standard rental agreement which provides auto and 35 travel related coverages through authorized insurers during a rental 36 period not to exceed ninety (90) days. 37 41-1006. APPLICATION FOR EXAMINATION. (1) A resident individual applying 38 for an insurance producer license or an insurance consultant license shall 39 pass a written examination unless exempt pursuant to section 41-1008(4), 40 41-1012, 41-1027(3) or 41-1028(2)(c), Idaho Code. The examination shall test 41 the knowledge of the individual concerning the lines of authority for which 42 application is made, the duties and responsibilities of an insurance producer 43 and the insurance laws and rules of this state. Examinations required by this 44 section shall be developed and conducted under rules prescribed by the direc- 45 tor of the department of insurance. 46 (2) Each individual applying for an examination shall remit a nonrefund- 47 able fee as promulgated by the director pursuant to section 41-401, Idaho 48 Code. 49 (3) An individual who fails to appear for the examination as scheduled or 50 who fails to pass the examination shall reapply for an examination and remit 51 all required fees and forms before being rescheduled for another examination. 52 (4) Applications for licensure not received by the department within one 53 hundred eighty (180) days of the successful completion of the examination 54 shall be denied. 7 1 41-1007. APPLICATION FOR PRODUCER LICENSE. (1) A person applying for a 2 resident insurance producer license shall make application to the director on 3 the uniform application and declare under penalty of refusal, suspension or 4 revocation of the license that the statements made in the application are 5 true, correct and complete to the best of the applicant's knowledge and 6 belief. Before approving the application, the director shall find that the 7 applicant: 8 (a) Is at least eighteen (18) years of age; 9 (b) Has submitted the applicant's fingerprints as may be required by the 10 director; 11 (c) Has not committed any act that is a ground for denial, suspension or 12 revocation of the license as set forth in title 41, Idaho Code; 13 (d) Has paid the fees prescribed by the director pursuant to section 14 41-401, Idaho Code; and 15 (e) Has successfully passed the examinations for the lines of authority 16 for which the applicant has applied. 17 (2) A business entity acting as an insurance producer is required to 18 obtain an insurance producer license. Application shall be made using the uni- 19 form business entity application. Before approving the application, the direc- 20 tor shall find that: 21 (a) The business entity has paid the fees prescribed by the director pur- 22 suant to section 41-401, Idaho Code; and 23 (b) The business entity has designated a licensed producer, who is an 24 individual responsible for the business entity's compliance with the 25 insurance laws and rules of this state. 26 (3) The director may require any documents which are reasonably necessary 27 to verify the information contained in an application. 28 (4) Each insurer that sells, solicits or negotiates any form of limited 29 line insurance shall provide to each individual whose duties will include 30 selling, soliciting or negotiating limited lines insurance a program of 31 instruction that may be required to be approved by the director. If acceptable 32 to the director, and as stated by rule, the program of instruction may be 33 administered in place of the examination as required in section 41-1006, Idaho 34 Code. In addition, such course of instruction may be administered in place of 35 any continuing education requirements pursuant to section 41-1013, Idaho Code. 36 41-1008. PRODUCER LICENSE. (1) Unless denied licensure pursuant to sec- 37 tion 41-1016, Idaho Code, persons who have met the requirements of sections 38 41-1006 and 41-1007, Idaho Code, shall be issued an insurance producer 39 license. An insurance producer may receive qualification for a license in one 40 (1) or more of the following lines of authority: 41 (a) Life insurance coverage on human lives, including benefits of endow- 42 ment and annuities, benefits in the event of death or dismemberment by 43 accident, and benefits for disability income; 44 (b) Disability, including accident and health or sickness insurance cov- 45 erage for sickness, bodily injury or accidental death and benefits for 46 disability income; 47 (c) Property insurance coverage for the direct or consequential loss or 48 damage to property of every kind; 49 (d) Casualty insurance coverage against legal liability, including lia- 50 bility for death, injury or disability or damage to real or personal prop- 51 erty; 52 (e) Variable life and variable annuity products, meaning insurance cover- 53 age provided under variable life insurance contracts and variable annu- 54 ities; 8 1 (f) Personal lines, meaning property and casualty insurance coverage sold 2 to individuals and families for primarily noncommercial purposes; 3 (g) Any other line of insurance permitted under state laws or rules. 4 (2) An insurance producer license shall remain in effect unless revoked 5 or suspended as long as the renewal fee promulgated by the director pursuant 6 to section 41-401, Idaho Code, is paid and the continuing education require- 7 ments for resident insurance producers are met in accordance with section 8 41-1013, Idaho Code. 9 (3) An individual insurance producer who allows his or her license to 10 lapse may, within twelve (12) months from the due date of the renewal fee, 11 reinstate the same license without passing a written examination unless the 12 licensee would otherwise be required to retest under section 41-1013(7), Idaho 13 Code. However, a penalty in the amount of double the unpaid renewal fee shall 14 be required for any renewal fee received after the due date. 15 (4) A licensed insurance producer who is unable to comply with license 16 renewal procedures due to military service or some other extenuating circum- 17 stance, such as a long-term medical disability, may request that the director 18 waive those procedures. The producer may also request a waiver of any examina- 19 tion requirement or any other fine or sanction imposed for failure to comply 20 with renewal procedures. 21 (5) The license shall contain the licensee's name, address, personal 22 identification number, the date of issuance, the lines of authority, the expi- 23 ration date and any other information the director deems necessary. 24 (6) Licensees shall inform the director by any means acceptable to the 25 director of a change of address within thirty (30) days of the change. A busi- 26 ness entity licensed as a producer shall inform the director by any means 27 acceptable to the director of any change in ownership, officers, directors or 28 the designated licensed producer responsible for compliance pursuant to sec- 29 tion 41-1007(2)(b), Idaho Code. 30 (7) In order to assist in the performance of the director's duties, the 31 director may contract with nongovernmental entities, including the national 32 association of insurance commissioners or its affiliates or subsidiaries, to 33 perform any ministerial functions related to producer licensing, including the 34 collection of fees, that the director and the nongovernmental entity may deem 35 appropriate. 36 41-1009. NONRESIDENT PRODUCER LICENSE. (1) Unless denied licensure pursu- 37 ant to section 41-1016, Idaho Code, a nonresident applicant shall receive a 38 nonresident producer license if: 39 (a) The applicant is currently licensed as a resident and in good stand- 40 ing in his or her home state; 41 (b) The applicant has submitted the proper request for licensure and has 42 paid the fees set forth by rule pursuant to section 41-401, Idaho Code; 43 (c) The applicant has submitted or transmitted to the director the appli- 44 cation for licensure that the applicant submitted to his or her home state 45 or, in lieu of such application, a completed uniform application; 46 (d) The applicant has submitted the applicant's fingerprints, if required 47 by the director, on a form as prescribed by the director; and 48 (e) The applicant's home state awards nonresident producer licenses to 49 residents of this state on the same basis. 50 (2) The director may verify the producer's licensing status through the 51 producer database maintained by the national association of insurance commis- 52 sioners, its affiliates or subsidiaries, or by any other acceptable means. 53 (3) A nonresident producer who moves from one state to another state or a 54 resident producer who moves from this state to another state shall file a 9 1 change of address and provide certification from the new resident state within 2 thirty (30) days of the change of legal residence. No fee or license applica- 3 tion shall be required for filing the change of address. 4 (4) Notwithstanding any other provision of this chapter, a person 5 licensed as a surplus lines broker in his or her home state shall receive a 6 nonresident surplus lines broker license pursuant to subsection (1) of this 7 section. Except as to subsection (1) of this section, nothing in this section 8 otherwise amends or supersedes any provision of section 41-1223, Idaho Code. 9 (5) Notwithstanding any other provision of this chapter, a person 10 licensed as a limited lines producer in his or her home state shall receive a 11 nonresident limited lines producer license, pursuant to subsection (1) of this 12 section, granting the same scope of authority as granted under the license 13 issued by the producer's home state. For the purposes of this subsection, lim- 14 ited lines insurance is any authority granted by the home state which 15 restricts the authority of the license to less than the total authority pre- 16 scribed in the associated major lines pursuant to section 41-1008(1)(a) 17 through (g), Idaho Code. 18 41-1010. NONRESIDENT PRODUCERS AND CONSULTANTS -- SERVICE OF PROCESS. (1) 19 Each person applying to be a nonresident producer or nonresident consultant 20 shall, on a form prescribed by the director, appoint the director as his agent 21 for purposes of receiving service of legal process issued against the producer 22 or consultant in this state upon causes of action arising within this state 23 out of transactions under the license. Service upon the director as an agent 24 shall constitute effective legal service upon the producer or consultant. 25 (2) The appointment shall be irrevocable for as long as there could be 26 any cause of action against the licensee arising out of his insurance transac- 27 tions in or with respect to this state. 28 (3) Duplicate copies of such legal process against the licensee shall be 29 served upon the director by a person competent to serve a summons. At the 30 time of service the plaintiff shall pay the director an appropriate fee to be 31 determined by rule and not exceeding thirty dollars ($30.00). 32 (4) Upon receiving such service, the director shall send one (1) copy of 33 the process by registered or certified mail with return receipt requested to 34 the defendant licensee at his last address of record with the director. 35 (5) The director shall keep a record of the day and hour of such service 36 upon him. No proceedings shall be brought against the producer or consultant, 37 and the producer or consultant shall not be required to appear, plead or 38 answer until the expiration of thirty (30) days after the date of service upon 39 the director. 40 41-1011. ISSUANCE -- REFUSAL OF LICENSE. If after completion of applica- 41 tion for a license, the taking and passing of any examination required under 42 this chapter and, if required by the director, receipt of a report from the 43 federal bureau of investigation based on the fingerprints of the applicant, 44 the director finds that the applicant has fully met the requirements for a 45 license, the director shall issue the license to the applicant; otherwise, the 46 director shall refuse to issue the license and shall promptly notify the 47 applicant and any appointing insurer or insurers of such refusal and state the 48 grounds for the refusal. Pending the receipt of the report from the federal 49 bureau of investigation, the director may, in his discretion, issue a tempo- 50 rary license if all other qualifications have been met. 51 41-1012. EXEMPTION FROM EXAMINATION. (1) An individual who applies for an 52 insurance producer license in this state and who was previously licensed for 10 1 the same lines of authority in another state shall not be required to complete 2 any prelicensing examination if: 3 (a) The person is currently licensed in another state; or 4 (b) The application is received within ninety (90) days of the cancella- 5 tion of the applicant's previous license and the prior state issues a cer- 6 tification that: 7 (i) At the time of cancellation, the applicant was in good standing 8 in that state; or 9 (ii) The state's producer database records, as maintained by the 10 national association of insurance commissioners or its affiliates or 11 subsidiaries, indicate that the producer is or was licensed in good 12 standing for the lines of authority requested. 13 (2) A person licensed as an insurance producer in another state who moves 14 to this state shall make application within ninety (90) days of establishing 15 legal residence to become a resident licensee pursuant to section 41-1006, 16 Idaho Code. No examination shall be required of that person to obtain any line 17 of authority previously held in the prior state unless the director provides 18 otherwise by rule. 19 41-1013. CONTINUATION -- EXPIRATION OF LICENSES -- CONTINUING EDUCATION 20 STATEMENT. (1) All producer, consultant, adjuster, and surplus line broker 21 licenses issued under this code shall continue in force until expired, sus- 22 pended, revoked or otherwise terminated, subject to payment of the applicable 23 continuation fee on or before the expiration date referred to in subsection 24 (2) of this section, accompanied by a written request for such continuation 25 and a continuing education statement verifying that the licensee has completed 26 any continuing education requirements imposed by the director. An application 27 for renewal is not complete unless it is submitted with both the applicable 28 fee and the completed continuing education statement. Requests for continua- 29 tion shall be made in writing on forms to be prescribed by the director. 30 (2) The director may fix the dates of expiration for licenses in such 31 manner as is deemed by him to be advisable for an efficient distribution of 32 the workload of his office. If the expiration date for a particular license or 33 appointment would shorten the period for which the license or appointment con- 34 tinuation fee has been paid, no refund of an unearned fee shall be made. If 35 the expiration date for a particular license or appointment would lengthen the 36 period for which a license or appointment continuation fee has been paid, the 37 director shall charge no additional fee for such lengthened period. 38 (3) Any license referred to in subsection (1) of this section for which 39 no request for continuation, fee and completed continuing education statement 40 are timely received by the director shall be deemed to have expired at mid- 41 night on the applicable expiration date. 42 (4) All sums tendered as fees for continuations of licenses as producer, 43 consultant, limited lines producer, adjuster or surplus line broker shall be 44 deemed earned when paid and shall not be subject to refund, except that the 45 director shall refund any duplicate payment of fees. 46 (5) For the protection of the people of this state the director shall 47 establish, by rule, additional educational requirements designed to maintain 48 and improve the insurance skills and knowledge of resident producers and resi- 49 dent consultants after licensure by the department of insurance. The director 50 shall also establish, by rule, an advisory committee comprised of representa- 51 tives from each segment of the insurance industry to assist the director in 52 prescribing additional educational requirements. Such rules promulgated by the 53 director shall include limits on the terms of service for members of the com- 54 mittee. 11 1 (6) Subject to subsection (3) of this section, the director shall not 2 permit to be continued the license of any producer who is licensed pursuant to 3 section 41-1007, Idaho Code, or any consultant who is licensed pursuant to 4 section 41-1027, Idaho Code, who is a resident of this state, unless such per- 5 son has demonstrated to the satisfaction of the director that in addition to 6 meeting the standards contained in sections 41-1007, (qualifications for pro- 7 ducer license) and 41-1027 (qualifications for resident consultant license), 8 Idaho Code, as may be applicable, all the additional educational requirements 9 as the director may prescribe by rule have been met. 10 (7) Failure of the licensee to comply with any applicable additional edu- 11 cation requirements prescribed by the director by rule by the expiration date 12 of the license shall be grounds for the director to refuse to continue any 13 such license. The licensee may reinstate his or her license by submitting 14 proof of all education requirements within ninety (90) days from the date of 15 expiration of the license and by submitting an additional administrative pen- 16 alty of one hundred dollars ($100) for a delinquency of one (1) day to thirty 17 (30) days, two hundred dollars ($200) for a delinquency of thirty-one (31) 18 days to sixty (60) days, and three hundred dollars ($300) for a delinquency of 19 sixty-one (61) days to ninety (90) days. Following the ninetieth day from the 20 date of nonrenewal of the license and up to one (1) year from the nonrenewal 21 date, the licensee must complete all requirements for licensure including 22 retesting, submission of a new application and payment of all new licensing 23 fees. In addition, the individual must submit proof of completion of the 24 required education requirements for the licensing period in which the license 25 was terminated. After the license has been expired for one (1) year or more, 26 the individual must reapply and retest as a new applicant. 27 41-1014. ASSUMED NAMES. An insurance producer doing business under any 28 name other than the producer's legal name is required to notify the director 29 in writing prior to using the assumed name. 30 41-1015. TEMPORARY LICENSING. (1) The director may issue a temporary 31 insurance producer license for a period not to exceed one hundred eighty (180) 32 days without requiring an examination if the director deems that the temporary 33 license is necessary for the servicing of an insurance business in the follow- 34 ing cases: 35 (a) To the surviving spouse or court-appointed personal representative of 36 a licensed insurance producer who dies or becomes mentally or physically 37 disabled in order to allow adequate time for the sale of the insurance 38 business owned by the producer or for the recovery or return of the pro- 39 ducer to the business or to provide for the training and licensing of new 40 personnel to operate the producer's business; 41 (b) To a member or employee of a business entity licensed as an insurance 42 producer upon the death or disability of an individual designated in the 43 business entity application or the license; 44 (c) To the designee of a licensed insurance producer entering active ser- 45 vice in the armed forces of the United States of America; or 46 (d) Pursuant to section 41-1011, Idaho Code, or in any other circumstance 47 where the director deems the public interest will best be served by the 48 issuance of the temporary license. 49 (2) The director may by order limit the authority of any temporary licen- 50 see in any way deemed necessary to protect insureds and the public. The direc- 51 tor may require the temporary licensee to have a suitable sponsor who is a 52 licensed producer or insurer and who assumes responsibility for all actions of 53 the temporary licensee, and may impose other similar requirements designed to 12 1 protect insureds and the public. The director may by order revoke a temporary 2 license, without the right to a prior hearing, if the interests of insureds or 3 the public are endangered. A temporary license may not continue after the 4 owner or the personal representative disposes of the business. 5 41-1016. ADMINISTRATIVE PENALTY -- SUSPENSION, REVOCATION, REFUSAL OF 6 LICENSE. (1) The director may impose an administrative penalty not to exceed 7 one thousand dollars ($1,000), for deposit in the general fund of the state of 8 Idaho, and may suspend for not more than twelve (12) months or may revoke or 9 refuse to issue or continue any license issued under this chapter, chapter 27, 10 title 41, Idaho Code (title insurance), chapter 11, title 41, Idaho Code 11 (adjusters), or any surplus lines broker license if, after a hearing held on 12 not less than twenty (20) days' notice of such hearing and of the charges 13 against the licensee given as provided in section 41-212(3), Idaho Code, to 14 the licensee and to any appointing insurers represented (as to a producer who 15 is appointed as an agent), the director finds that as to the licensee any one 16 (1) or more of the following causes or violations exist: 17 (a) Providing incorrect, misleading, incomplete or materially untrue 18 information in the license application; 19 (b) Violating any provision of title 41, Idaho Code, department rule, 20 subpoena or order of the director or of another state's insurance direc- 21 tor; 22 (c) Obtaining or attempting to obtain a license through misrepresentation 23 or fraud; 24 (d) Improperly withholding, misappropriating or converting any moneys or 25 properties received in the course of doing insurance business; 26 (e) Misrepresenting the terms of an actual or proposed insurance contract 27 or application for insurance or misrepresenting any fact material to any 28 insurance transaction or proposed transaction; 29 (f) Being convicted of or pleading guilty to any felony, or to a misde- 30 meanor which evidences bad moral character, dishonesty, a lack of integ- 31 rity and financial responsibility, or an unfitness and inability to pro- 32 vide acceptable service to the consuming public; 33 (g) Admitting or being found to have committed any insurance unfair trade 34 practice or fraud; 35 (h) Using fraudulent, coercive or dishonest practices, or demonstrating 36 incompetence, untrustworthiness or financial irresponsibility, or being a 37 source of injury and loss to the public or others, in the conduct of busi- 38 ness in this state or elsewhere; 39 (i) Having an insurance license denied, suspended or revoked in any other 40 state, province, district or territory; 41 (j) Forging another's name on an application for insurance or on any doc- 42 ument related to an insurance transaction; 43 (k) Improperly using notes or any other reference material to complete an 44 examination for an insurance license; 45 (l) Knowingly accepting insurance business from an individual who is not 46 licensed; 47 (m) Failing to comply with an administrative or court order imposing a 48 child support obligation, provided however, that nothing in this provision 49 shall be deemed to abrogate or modify chapter 14, title 7, Idaho Code; or 50 (n) Failing to pay state income tax or to comply with any administrative 51 or court order directing payment of state income tax. 52 (2) The director shall, without hearing, suspend for not more than twelve 53 (12) months, or shall revoke or refuse to continue any license issued under 54 this chapter to a nonresident where the director has received a final order of 13 1 suspension, revocation or refusal to continue from the insurance regulatory 2 official or court of jurisdiction of the licensee's home state. If cause under 3 this provision exists after the expiration of the twelve (12) months, succes- 4 sive suspensions may be imposed by the director without hearing. 5 (3) In the event that the director denies or refuses to renew an applica- 6 tion for a license, the director shall notify the applicant or licensee and 7 advise, in writing, the applicant or licensee of the reason for the denial or 8 nonrenewal of the applicant's or licensee's license. The applicant or licensee 9 may make written demand upon the director within twenty-one (21) days for a 10 hearing before the director to determine the reasonableness of the director's 11 action. The hearing shall be held pursuant to chapter 2, title 41, and chapter 12 52, title 67, Idaho Code. 13 (4) The license of a business entity may be suspended, revoked or refused 14 if the director finds, after hearing, that the violation of an individual 15 licensee, who is registered to or acting on behalf of the business entity, was 16 known or should have been known by one (1) or more of the owners, officers or 17 managers acting on behalf of the business entity and that the violation was 18 not reported to the director and no corrective action was taken. 19 (5) In addition to or in lieu of any applicable denial, suspension or 20 revocation of a license, a person may, after hearing, be subject to a civil 21 fine or administrative penalty pursuant to subsection (1) of this section or 22 any other applicable section. 23 (6) The director shall retain the authority to enforce the provisions of 24 and impose any penalty or remedy authorized by title 41, Idaho Code, against 25 any person who is under investigation for or charged with a violation of title 26 41, Idaho Code, or department rule, even if the person's license or registra- 27 tion has been surrendered, has lapsed by operation of law, or if the person 28 has never been licensed. 29 41-1017. COMMISSIONS. (1) An insurance company or insurance producer 30 shall not pay a commission, service fee or other valuable consideration to a 31 person for selling, soliciting or negotiating insurance in this state if that 32 person is not duly licensed as required under this chapter. 33 (2) A person shall not accept a commission, service fee or other valuable 34 consideration for selling, soliciting or negotiating insurance in this state 35 if that person is not duly licensed as required under this chapter. 36 (3) Renewals or other deferred commissions may be paid to a person for 37 selling, soliciting or negotiating insurance in this state if that person was 38 duly licensed as required under this chapter at the time of the sale, solici- 39 tation or negotiation. 40 (4) An insurer or insurance producer may pay or assign commissions, ser- 41 vice fees or other valuable consideration to any person, regardless of whether 42 that person is licensed as a producer, unless the payment or assignment would 43 violate a specific section of title 41, Idaho Code, including, but not limited 44 to, sections 41-1314 and 41-2708, Idaho Code, or department rule. 45 41-1018. APPOINTMENTS. (1) An insurance producer shall not act as an 46 agent of an insurer unless the insurance producer becomes an appointed agent 47 of that insurer. An insurance producer who is not acting as an agent of an 48 insurer is not required to become appointed. 49 (2) To appoint a producer as its agent, the appointing insurer shall 50 file, in a format approved by the director, a notice of appointment within 51 fifteen (15) days from the date the agency contract is executed or the first 52 insurance application is submitted. 53 (3) Upon receipt of the notice of appointment, the director shall verify, 14 1 within a reasonable time not to exceed thirty (30) days, that the insurance 2 producer is eligible for appointment. If the insurance producer is determined 3 to be ineligible for appointment, the director shall notify the insurer within 4 five (5) days of his determination. 5 41-1019. NOTIFICATION TO DIRECTOR OF TERMINATION. (1) An insurer or 6 authorized representative of the insurer that terminates the appointment, 7 employment, contract or other insurance business relationship with a producer 8 shall notify the director within thirty (30) days following the effective date 9 of the termination, using a format prescribed by the director, if the reason 10 for termination is one of the reasons set forth in section 41-1016, Idaho 11 Code, or the insurer has knowledge that the producer was found by a court, 12 governmental body or self-regulatory organization authorized by law to have 13 engaged in any of the activities set forth in section 41-1016, Idaho Code. 14 Upon the written request of the director, the insurer shall provide additional 15 information, documents, records or other data pertaining to the termination or 16 activity of the producer. 17 (2) An insurer or authorized representative of the insurer that termi- 18 nates the appointment, employment, contract or other insurance business rela- 19 tionship with a producer for any reason not set forth in section 41-1016, 20 Idaho Code, shall notify the director within thirty (30) days following the 21 effective date of the termination, using a format prescribed by the director. 22 Upon written request of the director, the insurer shall provide additional 23 information, documents, records or other data pertaining to the termination. 24 (3) The insurer or authorized representative of the insurer shall 25 promptly notify the director in a format acceptable to the director if, upon 26 further review or investigation, the insurer discovers additional information 27 that would have been reportable to the director in accordance with subsection 28 (1) of this section. 29 (4) A copy of any notification shall be provided to the producer as fol- 30 lows: 31 (a) Within fifteen (15) days after making the notification required by 32 subsections (1), (2) and (3) of this section, the insurer shall mail a 33 copy of the notification to the producer at his or her last known address. 34 If the producer is terminated for cause for any other reasons listed in 35 section 41-1016, Idaho Code, the insurer shall provide a copy of the noti- 36 fication to the producer at his or her last known address by certified 37 mail, return receipt requested, postage prepaid or by overnight delivery 38 using a nationally recognized carrier. 39 (b) Within thirty (30) days after the producer has received the original 40 or additional notification, the producer may file written comments con- 41 cerning the substance of the notification with the director. The producer 42 shall, by the same means, simultaneously send a copy of the comments to 43 the reporting insurer, and the comments shall become a part of the 44 director's file and shall accompany every copy of a report distributed or 45 disclosed for any reason about the producer as permitted under subsection 46 (6) of this section. 47 (5) Immunities. 48 (a) In the absence of actual malice, an insurer, the authorized represen- 49 tative of the insurer, a producer, the director, or an organization of 50 which the director is a member and that compiles information and makes it 51 available to other insurance directors or regulatory or law enforcement 52 agencies, shall not be subject to civil liability, and a civil cause of 53 action of any nature shall not arise against these entities or their 54 respective agents or employees as a result of any statement or information 15 1 required by or provided pursuant to this section or any information relat- 2 ing to any statement that may be requested in writing by the director from 3 an insurer or producer or as a result of any statement by a terminating 4 insurer or producer to an insurer or producer limited solely and exclu- 5 sively to whether a termination for cause under subsection (1) of this 6 section was reported to the director, provided that the propriety of any 7 termination for cause under subsection (1) of this section is certified in 8 writing by an officer or authorized representative of the insurer or pro- 9 ducer terminating the relationship. 10 (b) In any action brought against a person that may have immunity under 11 paragraph (a) of this subsection for making any statement required by this 12 section or providing any information relating to any statement that may be 13 requested by the director, the party bringing the action shall plead spe- 14 cifically in any allegation that paragraph (a) of this subsection does not 15 apply because the person making the statement or providing the information 16 did so with actual malice. 17 (c) Paragraph (a) or (b) of this subsection shall not abrogate or modify 18 any existing statutory or common law privileges or immunities. 19 (6) Confidentiality. 20 (a) Any documents, materials or other information in the control or pos- 21 session of the department of insurance that is furnished by an insurer, 22 producer or an employee or agent acting on behalf of the insurer or pro- 23 ducer, or obtained by the director in an investigation pursuant to this 24 section, shall be confidential and privileged, shall be exempt from public 25 disclosure under chapter 3, title 9, Idaho Code, shall not be subject to 26 subpoena, shall not be subject to discovery, and shall not be admissible 27 in evidence in any private civil action. However, the director is autho- 28 rized to use the documents, materials or other information in the further- 29 ance of any regulatory or legal action brought as a part of the director's 30 duties. 31 (b) Neither the director nor any person who receives documents, materials 32 or other information while acting under the authority of the director 33 shall be permitted or required to testify in any private civil action con- 34 cerning any confidential documents, materials or information subject to 35 paragraph (a) of this subsection. 36 (c) In order to assist in the performance of the director's duties under 37 this chapter, the director: 38 (i) May share documents, materials or other information, including 39 confidential and privileged documents and materials or information 40 subject to paragraph (a) of this subsection, with other state, fed- 41 eral and international regulatory agencies and law enforcement 42 authorities, and with the national association of insurance commis- 43 sioners, its affiliates or subsidiaries, provided that the recipient 44 agrees to maintain the confidentiality and privileged status of the 45 documents, materials or other information; 46 (ii) May receive documents, materials or information, including 47 otherwise confidential and privileged documents, materials or infor- 48 mation, from the national association of insurance commissioners, its 49 affiliates or subsidiaries and from regulatory agencies and law 50 enforcement authorities of other foreign or domestic jurisdictions, 51 and shall maintain as confidential or privileged any documents, mate- 52 rials or information received with notice or with the understanding 53 that they are confidential or privileged under the laws of the juris- 54 diction that is the source of the documents, materials or informa- 55 tion; and 16 1 (iii) May enter into agreements governing sharing and use of informa- 2 tion consistent with this subsection. 3 (d) No waiver of any applicable privilege or claim of confidentiality in 4 the documents, materials or information shall occur as a result of disclo- 5 sure to the director under this section or as a result of sharing as 6 authorized in paragraph (c) of this subsection. 7 (e) Nothing in this chapter shall prohibit the director from releasing 8 final adjudicated actions, including for cause terminations that are open 9 to public inspection pursuant to chapter 3, title 9 and title 41, Idaho 10 Code, to a database or other clearinghouse service maintained by the 11 national association of insurance commissioners or its affiliates or sub- 12 sidiaries. 13 (7) Penalties for failing to report. An insurer, the authorized represen- 14 tative of the insurer, or a producer who fails to report as required under the 15 provisions of this section or who is found by a court of competent jurisdic- 16 tion to have reported with actual malice may, after notice and hearing, have 17 his license or certificate of authority suspended or revoked and may be fined 18 in accordance with section 41-1016 or 41-327, Idaho Code. 19 41-1020. RECIPROCITY. (1) The director shall waive any requirements, 20 except the requirements imposed by section 41-1009, Idaho Code, for a nonresi- 21 dent producer license applicant with a valid license from his or her home 22 state if the applicant's home state awards nonresident licenses to residents 23 of this state on the same basis. 24 (2) A nonresident producer's satisfaction of his or her home state's con- 25 tinuing education requirements for licensed insurance producers shall consti- 26 tute satisfaction of this state's continuing education requirements if the 27 nonresident producer's home state recognizes the satisfaction of its continu- 28 ing education requirements imposed upon producers from this state on the same 29 basis. 30 41-1021. REPORTING OF ACTIONS. (1) A producer shall report to the direc- 31 tor any administrative action taken against the producer in another jurisdic- 32 tion or by another governmental agency within thirty (30) days of the final 33 disposition of the matter. This report shall include a copy of the order, con- 34 sent order or other relevant legal documents. 35 (2) Within thirty (30) days of the initial pretrial hearing date, a pro- 36 ducer shall report to the director any criminal prosecution of the producer 37 taken in any jurisdiction. The report shall include a copy of the initial com- 38 plaint filed, the order resulting from the hearing and any other relevant 39 legal documents. 40 41-1022. INSURERS MUST ACCEPT BUSINESS THROUGH LICENSED PRODUCERS ONLY. 41 (1) No authorized insurer shall make, write, place or cause to be made, writ- 42 ten or placed in this state any policy, duplicate policy, or insurance con- 43 tract of any kind, covering a subject of insurance resident, located or to be 44 performed in this state through any person who is not then licensed as a pro- 45 ducer under this chapter. 46 (2) The director may penalize, suspend or revoke the certificate of 47 authority of any insurer violating this section in accordance with section 48 41-327(1), Idaho Code. 49 41-1023. COUNTERSIGNATURE OF POLICIES -- POWER OF ATTORNEY. (1) When the 50 signature or countersignature of a property or casualty producer is required 51 on an insurance contract, or rider or endorsement thereto, the producer shall, 17 1 except as provided in section 41-337(1), Idaho Code, and subsection (2) of 2 this section, affix his original written signature thereon. 3 (2) The property or casualty producer may grant a power of attorney in 4 writing to an individual who is twenty-one (21) years of age or older, autho- 5 rizing such person to countersign or cause a facsimile of the agent's signa- 6 ture to be placed on policies and endorsements in his name and on his behalf. 7 The power of attorney shall be acknowledged by the agent under oath before a 8 notary public and shall be kept on file in the agent's office. 9 41-1024. REPORTING AND ACCOUNTING FOR PREMIUMS. (1) All premiums or 10 return premiums received by a producer shall be trust funds received by the 11 producer in a fiduciary capacity, and the producer shall, in the applicable 12 regular course of business, account for and pay the same to the insured, 13 insurer or producer entitled to the funds. If the producer establishes a sepa- 14 rate deposit for funds belonging to others in order to avoid a commingling of 15 such fiduciary funds with his own funds, he may deposit and commingle in such 16 separate deposit all funds belonging to others so long as the amount of such 17 deposit so held for all other persons is reasonably ascertainable from the 18 records and accounts of the producer. 19 (2) Any producer who, not being lawfully entitled thereto, diverts or 20 appropriates to his own use such trust or fiduciary funds or any portion 21 thereof, whether or not such funds have been separately deposited, shall upon 22 conviction be guilty of a felony. 23 41-1025. CONSULTANT LICENSE REQUIRED. (1) A person shall not engage in 24 any of the following activities unless the person holds a valid consultant 25 license issued by the director: 26 (a) Purporting or offering to engage in any of the activities described 27 in paragraph (b) of this subsection by using, in conjunction with the 28 person's name, the title or designation of insurance planner, consultant, 29 adviser, counselor or any similar title or designation; or 30 (b) For compensation other than commission from the sale of insurance, 31 engaging, attempting to engage or offering to engage in any of the follow- 32 ing activities: 33 (i) Acting as a consultant regarding insurance; 34 (ii) Giving advice, counsel, opinion or service with respect to the 35 benefits, advantages or disadvantages of insurance that may be or has 36 been issued in this state; or 37 (iii) In any other manner providing information about insurance. 38 (2) For the purposes of subsection (1)(b) of this section, compensation 39 includes consideration paid for financial and other related services provided 40 in connection with services referred to in subsection (1)(b) of this section. 41 41-1026. EXEMPTIONS. (1) The following persons are not insurance consul- 42 tants for the purposes of this chapter, and the prohibition in section 43 41-1025(1), Idaho Code, does not apply to: 44 (a) Any attorney rendering services in the performance of duties of an 45 attorney; 46 (b) Any certified public accountant rendering services in the performance 47 of the duties of a certified public accountant, as authorized by law; 48 (c) Any person who, while conducting an educational seminar, performs any 49 of the activities described in section 41-1025(1)(b), Idaho Code; 50 (d) Any actuary who is a member of an organization determined by the 51 director as establishing standards for the actuarial profession; or 52 (e) A person who provides or offers or purports to provide any of the 18 1 services described in section 41-1025(1)(b), Idaho Code, to agents or 2 authorized insurers only. 3 41-1027. QUALIFICATIONS FOR RESIDENT CONSULTANT LICENSE. An applicant for 4 a license as a resident consultant shall apply for the license on a form as 5 prescribed by the director and must meet the following requirements: 6 (1) The applicant must provide satisfactory evidence to the director that 7 the insurance required under section 41-1031, Idaho Code, has been procured 8 and is in effect. 9 (2) The applicant, if an individual, must have had at least five (5) 10 years' experience in the insurance business relating to the class or classes 11 of insurance for which the applicant is applying to be an insurance consultant 12 and must have met educational qualifications as prescribed by the director by 13 rule. 14 (3) The applicant, if an individual, must take and pass a written exami- 15 nation given by the director. The examination requirement does not apply to an 16 applicant who is licensed as a producer to transact the class or classes of 17 insurance for which the applicant is applying to be an insurance consultant. 18 (4) The applicant must satisfy any other requirements established by the 19 director by rule. 20 41-1028. NONRESIDENT CONSULTANT LICENSE. (1) A person who resides in 21 another state or a province of Canada and is licensed in that state or prov- 22 ince as an insurance consultant may be licensed to act as a nonresident con- 23 sultant in this state as provided in this section if the state or province in 24 which the person resides gives the same privilege to a resident insurance con- 25 sultant of this state. 26 (2) An applicant for a license to act as a nonresident consultant shall 27 apply for the license on a form as prescribed by the director, and must meet 28 the following requirements: 29 (a) The applicant must provide satisfactory evidence to the director that 30 the insurance required in section 41-1031, Idaho Code, has been procured 31 and is in effect. 32 (b) The applicant, if an individual, must have had at least five (5) 33 years' experience in the insurance business relating to the class or clas- 34 ses of insurance for which the applicant is applying to be an insurance 35 consultant and must have met educational qualifications as prescribed by 36 the director by rule. 37 (c) The applicant, if an individual, must take and pass a written exami- 38 nation given by the director, unless the state or province in which the 39 applicant resides licenses or registers insurance consultants of this 40 state without examination. If the individual is not required to be 41 licensed in his home state, the individual may meet the requirements for a 42 consultant license in this state by taking and passing the consultant exam 43 and by meeting the qualifications described in paragraphs (a) and (b) of 44 this subsection. The examination requirement does not apply to an appli- 45 cant who is licensed as a nonresident producer to transact the class or 46 classes of insurance for which the applicant is applying to be an insur- 47 ance consultant. 48 (d) The applicant must satisfy any other requirements established by the 49 director by rule. 50 41-1029. CLASSES OF INSURANCE FOR CONSULTANTS. When the director issues a 51 license authorizing a person to act as an insurance consultant, the director 52 shall endorse on the license the class or classes of insurance described in 19 1 this section with respect to which the person is authorized to act as an 2 insurance consultant. The classes of insurance are: 3 (1) Life insurance; 4 (2) Disability insurance; 5 (3) Property and casualty insurance. Under this class, an insurance con- 6 sultant may also act as a consultant with respect to marine, transportation 7 and surety insurance; and 8 (4) Any class of insurance designated by the director by rule. 9 41-1030. DISCLOSURE BY CONSULTANTS. (1) An insurance consultant shall 10 furnish to each client and prospective client a written disclosure statement 11 containing the following information: 12 (a) A description of the nature of the work to be performed by the insur- 13 ance consultant; 14 (b) The applicable occupational and educational background of the insur- 15 ance consultant; 16 (c) The area or areas of insurance in which the insurance consultant has 17 particular expertise; 18 (d) The fee schedule and any other expenses that the insurance consultant 19 charges and whether the fees may be negotiated; 20 (e) The names of any persons, other than clients, that the insurance con- 21 sultant represents; 22 (f) Whether the insurance consultant will receive any commission or 23 obtain any other compensation for services provided to the client in addi- 24 tion to fees and other expenses paid by the client; and 25 (g) Any other information required by the director by rule. 26 (2) An insurance consultant shall disclose information required under 27 this subsection to each client in the course of providing insurance consultant 28 services to the client and before the insurance consultant makes any final 29 insurance recommendation to the client. The insurance consultant shall dis- 30 close at least the following information as applicable to the line of insur- 31 ance for which the insurance consultant is providing services: 32 (a) Other business activities of the insurance consultant relating to 33 financial planning; 34 (b) The method of investment analysis and comparison used; 35 (c) Assumptions contributing to insurance recommendations for the client; 36 and 37 (d) Any other information required by the director by rule. 38 (3) The director may establish additional disclosure requirements for 39 licensees who are licensed as both producers and consultants. 40 (4) The director may prescribe the form of disclosure statement to be 41 used under subsection (1) of this section. 42 41-1031. ERRORS AND OMISSIONS INSURANCE. (1) An insurance consultant 43 shall maintain with the director a current certificate of errors and omissions 44 insurance in an amount established by the director by rule. 45 (2) If the director determines that errors and omissions insurance 46 required under this section is not generally available at a reasonable cost, 47 the director may, by rule, suspend the requirement of such insurance. The 48 requirement shall be reimposed when, in the determination of the director, 49 such insurance becomes generally available again at a reasonable cost. 50 41-1032. RULES. The director may, in accordance with section 41-211, 51 Idaho Code, promulgate reasonable rules as are necessary or proper to carry 52 out the purposes of this chapter. 20 1 41-1033. PROCEDURE FOLLOWING SUSPENSION, REVOCATION -- REINSTATEMENT. (1) 2 Upon suspension, revocation, or refusal to continue any license, the director 3 shall notify the licensee as provided in section 41-212(3), Idaho Code, and, 4 in the case of a producer who holds appointments from insurers, shall give 5 like notice to the insurers represented. 6 (2) Suspension, revocation, or refusal of any one (1) license held by the 7 licensee under title 41, Idaho Code, shall automatically suspend, revoke or 8 refuse continuation of all other licenses held by the licensee under title 41, 9 Idaho Code. 10 (3) The director shall not issue a license under title 41, Idaho Code, to 11 or as to any person whose license has been revoked or continuance refused 12 until after the expiration of one (1) year from the date of such revocation or 13 refusal or, if judicial review of such revocation or refusal is sought, within 14 one (1) year from the date of a final court order or decree affirming the 15 revocation or refusal. In the event the former licensee again files an appli- 16 cation for a license under title 41, Idaho Code, the director may require the 17 applicant to show good cause why the prior revocation or refusal to continue 18 his license shall not be deemed a bar to the issuance of a new license. 19 41-1034. RETURN OF LICENSE. (1) All licenses, although issued and deliv- 20 ered as to the licensee producer, consultant, adjuster or surplus lines bro- 21 ker, shall at all times be the property of the state of Idaho. Upon any expi- 22 ration, termination, suspension or revocation of the license, the licensee or 23 other person having possession or custody of the license shall deliver it to 24 the director either by personal delivery or by mail. 25 (2) In the case of any license that is lost, stolen or destroyed while in 26 the possession of a licensee or other person, the director may, in lieu of the 27 return of the license, accept the affidavits of the licensee or other person 28 responsible for or involved in the safekeeping of such license concerning the 29 facts of the loss, theft or destruction. 30 41-1035. INACTIVE STATUS. (1) Any individual producer or consultant who 31 does not want to actively continue in the business of insurance may apply for 32 inactive status of his license on forms prescribed by the director. The direc- 33 tor, in his discretion, may grant or deny the application for inactive status 34 and shall notify the licensee of this decision in writing. Inactive status of 35 a license, once granted, shall apply to all licenses held by the licensee and 36 shall continue in force until reactivated pursuant to this section or until 37 the license is suspended or revoked pursuant to this chapter. 38 (2) During the period that a licensee remains on inactive status, the 39 licensee may not transact the business of insurance in this state or engage in 40 any other insurance activity which requires an active license. A licensee on 41 inactive status may, subject to the terms of an insurer's contract with the 42 licensee, continue to receive commissions or other compensation relative to 43 business written by such licensee during active license status. 44 (3) Any individual producer or consultant whose license is placed on 45 inactive status shall be exempt from compliance with continuing education 46 requirements. 47 (4) An individual producer or consultant whose license is placed on inac- 48 tive status shall be subject to payment of the applicable continuation fees. 49 (5) An individual producer or consultant whose license is on inactive 50 status may apply for reactivation of a license on forms prescribed by the 51 director. The request for reactivation shall include proof of completion of 52 twenty (20) hours of continuing education earned during the twelve (12) months 53 prior to reactivation or proof that the producer or consultant has retested 21 1 and met the examination requirements as to any line or kind of insurance to be 2 transacted under the reactivated license. The director, in his discretion, may 3 grant or deny the application for reactivation. 4 41-1036. SEVERABILITY. If any provision of this chapter or its applica- 5 tion to any person or circumstance is held invalid, the invalidity does not 6 affect other provisions or applications of this chapter which can be given 7 effect without the invalid provision or application, and to this end the pro- 8 visions of this chapter are severable. 9 SECTION 4. That Section 41-1108, Idaho Code, be, and the same is hereby 10 amended to read as follows: 11 41-1108. OTHER PROVISIONS APPLICABLE. The following sections of chapter 12 10, title 41, Idaho Code, shall, to the extent so applicable, also apply as to 13 adjuster licenses: 14 (1) 41-10307(51)(misrepresentations, etc. in application -- penalty15 (application for producer license). 16 (2) 41-1008 (producer license). 17 (3) 41-104311 (issuance, refusal of license). 18 (34) 41-104613 (continuation, expiration of license, continuing education 19 statement). 20(4) 41-1076 (change of address).21 (5) 41-107716 (administrative penalty -- suspension, revocation, refusal 22 of license). 23 (6) 41-107833 (procedure following suspension, revocation -- reinstate- 24 ment). 25 (7) 41-107934 (return of license). 26 SECTION 5. That Section 41-1223, Idaho Code, be, and the same is hereby 27 amended to read as follows: 28 41-1223. LICENSING OF SURPLUS LINE BROKERS. (1) Any individual while 29 licensed in this state as aresident general lines agentproducer licensed for 30 property or casualty insurance who has had at least two (2) years' experience 31 as a licensed agent or broker for the lines of insurance for which he is seek- 32 ing to be licensed as a surplus lines broker, and who is deemed by the direc- 33 tor to be competent and trustworthy with respect to the handling of surplus 34 lines, and while maintaining an office at a designated location in this state, 35 may be licensed as a surplus line broker. 36 (2) Application for the license shall be made to the director on forms as 37 designated and furnished by the director. 38 (3) The license and continuation fee shall be asspecified inset forth 39 by rule pursuant to section 41-401, Idaho Code.(fee schedule).40 (4) The license and licensee shall be subject to the applicable provi- 41 sions of chapter 10, title 41, Idaho Code (agents, brokers, solicitorspro- 42 ducers and consultants -- licensing).requirements and procedures).43 SECTION 6. That Section 41-1315A, Idaho Code, be, and the same is hereby 44 amended to read as follows: 45 41-1315A. DISCOUNTS TO EMPLOYEES. No provision ofthis codetitle 41, 46 Idaho Code, shall be deemed to prohibit allowance by an insurer, agent, or 47 broker to the insurer's or licensee's bona fide full-time salaried employee of 48 a discount from the premium otherwise payable for insurance on the employee's 22 1 life or health or those of his dependents, or on the employee's property or 2 risks other than property or risks used or involved in business operations of 3 the employee other than as an employee of the insurer, agent, or broker. The 4 amount of discount shall in no event exceed the amount of agent's commission 5 which the employer insurer may otherwise pay, or the amount of commission to 6 be received by the employer agent or broker, with respect to the insurance. 7For the purposes of section 41-1033 (controlled business), Idaho Code, the8insurance as to employees of an agent or broker shall be included within the9controlled business of the licensee upon the basis of the commission which the10licensee was entitled to receive as if the discount had not been allowed.11 SECTION 7. That Section 41-3435, Idaho Code, be, and the same is hereby 12 amended to read as follows: 13 41-3435.AGENTSPRODUCER LICENSING. (1)AgentsProducers or persons rep- 14 resenting a service corporation in the solicitation and negotiation of 15 subscriber's contracts shall qualify for and be licensed asagentsproducers 16 of the service corporation in the same manner and in compliance with the same 17 applicable qualifications, licensing procedures and fees as apply under this 18 code as toagentsproducers of disability insurers;except that: 19 (a) Any such person who holds a valid license asan agenta producer for 20 a disability insurer issued under chapter 10, title 41, Idaho Code, may be 21 appointed as the agent for such service corporation without further exami- 22 nation or other compliance with chapter 10, title 41, Idaho Code; and 23 (b) Nothing in this section shall prevent such person from being licensed 24 as a producer and appointed as an agent for a life insurer or insurers 25 under chapter 10, title 41, Idaho Code, and concurrently being licensed as 26an agenta producer for such a service corporation. 27 (2) Service corporationsshallmay file appointment ofsuchagents or 28 representatives in the same manner as provided in section 41-104718, Idaho 29 Code, with respect toagentsproducers of insurers. 30 (3) The exceptions to license requirements set forth in chapter 10, title 31 41, Idaho Code, shall also apply as to service corporations. 32 SECTION 8. That Section 41-4703, Idaho Code, be, and the same is hereby 33 amended to read as follows: 34 41-4703. DEFINITIONS. As used in this chapter: 35 (1) "Actuarial certification" means a written statement by a member of 36 the American academy of actuaries or other individual acceptable to the direc- 37 tor that a small employer carrier is in compliance with the provisions of sec- 38 tion 41-4706, Idaho Code, based upon the person's examination and including a 39 review of the appropriate records and the actuarial assumptions and methods 40 used by the small employer carrier in establishing premium rates for applica- 41 ble health benefit plans. 42 (2) "Affiliate" or "affiliated" means any entity or person who directly 43 or indirectly through one (1) or more intermediaries, controls or is con- 44 trolled by, or is under common control with, a specified entity or person. 45 (3) "Agent" meansan agenta producer as defined in section 41-102103(9), 46 Idaho Code, or a broker as defined in section 41-1024, Idaho Code. 47 (4) "Base premium rate" means, for each class of business as to a rating 48 period, the lowest premium rate charged or that could have been charged under 49 a rating system for that class of business by the small employer carrier to 50 small employers with similar case characteristics for health benefit plans 51 with the same or similar coverage. 23 1 (5) "Board" means the board of directors of the small employer reinsur- 2 ance program and the individual high risk reinsurance pool as provided for in 3 section 41-5502, Idaho Code. 4 (6) "Carrier" means any entity that provides health insurance in this 5 state. For the purposes of this chapter, carrier includes an insurance com- 6 pany, a hospital or professional service corporation, a fraternal benefit 7 society, a health maintenance organization, any entity providing health 8 insurance coverage or benefits to residents of this state as certificate hold- 9 ers under a group policy issued or delivered outside of this state, and any 10 other entity providing a plan of health insurance or health benefits subject 11 to state insurance regulation. 12 (7) "Case characteristics" means demographic or other objective charac- 13 teristics of a small employer that are considered by the small employer car- 14 rier in the determination of premium rates for the small employer, provided 15 that claim experience, health status and duration of coverage shall not be 16 case characteristics for the purposes of this chapter. 17 (8) "Catastrophic health benefit plan" means a higher limit health bene- 18 fit plan developed pursuant to section 41-4712, Idaho Code. 19 (9) "Class of business" means all or a separate grouping of small employ- 20 ers established pursuant to section 41-4705, Idaho Code. 21 (10) "Control" shall be defined in the same manner as in section 22 41-3801(2), Idaho Code. 23 (11) "Dependent" means a spouse, an unmarried child under the age of nine- 24 teen (19) years, an unmarried child who is a full-time student under the age 25 of twenty-three (23) years and who is financially dependent upon the parent, 26 and an unmarried child of any age who is medically certified as disabled and 27 dependent upon the parent. 28 (12) "Director" means the director of the department of insurance of the 29 state of Idaho. 30 (13) "Eligible employee" means an employee who works on a full-time basis 31 and has a normal work week of thirty (30) or more hours or, by agreement 32 between the employer and the carrier, an employee who works between twenty 33 (20) and thirty (30) hours per week. The term includes a sole proprietor, a 34 partner of a partnership, and an independent contractor, if the sole propri- 35 etor, partner or independent contractor is included as an employee under a 36 health benefit plan of a small employer, but does not include an employee who 37 works on a part-time, temporary, seasonal or substitute basis. The term eligi- 38 ble employee may include public officers and public employees without regard 39 to the number of hours worked when designated by a small employer. 40 (14) "Established geographic service area" means a geographic area, as 41 approved by the director and based on the carrier's certificate of authority 42 to transact insurance in this state, within which the carrier is authorized to 43 provide coverage. 44 (15) "Health benefit plan" means any hospital or medical policy or certif- 45 icate, any subscriber contract provided by a hospital or professional service 46 corporation, or managed care organization subscriber contract. Health benefit 47 plan does not include policies or certificates of insurance for specific dis- 48 ease, hospital confinement indemnity, accident-only, credit, dental, vision, 49 medicare supplement, long-term care, or disability income insurance, student 50 health benefits only coverage issued as a supplement to liability insurance, 51 worker's compensation or similar insurance, automobile medical payment insur- 52 ance or nonrenewable short-term coverage issues for a period of twelve (12) 53 months or less. 54 (16) "Index rate" means, for each class of business as to a rating period 55 for small employers with similar case characteristics, the arithmetic average 24 1 of the applicable base premium rate and the corresponding highest premium 2 rate. 3 (17) "Late enrollee" means an eligible employee or dependent who requests 4 enrollment in a health benefit plan of a small employer following the initial 5 enrollment period during which the individual is entitled to enroll under the 6 terms of the health benefit plan, provided that the initial enrollment period 7 is a period of at least thirty (30) days. However, an eligible employee or 8 dependent shall not be considered a late enrollee if: 9 (a) The individual meets each of the following: 10 (i) The individual was covered under qualifying previous coverage 11 at the time of the initial enrollment; 12 (ii) The individual lost coverage under qualifying previous coverage 13 as a result of termination of employment or eligibility, or the 14 involuntary termination of the qualifying previous coverage; and 15 (iii) The individual requests enrollment within thirty (30) days 16 after termination of the qualifying previous coverage. 17 (b) The individual is employed by an employer which offers multiple 18 health benefit plans and the individual elects a different plan during an 19 open enrollment period. 20 (c) A court has ordered coverage be provided for a spouse or minor or 21 dependent child under a covered employee's health benefit plan and request 22 for enrollment is made within thirty (30) days after issuance of the court 23 order. 24 (d) The individual first becomes eligible. 25 (e) If an individual seeks to enroll a dependent during the first sixty 26 (60) days of eligibility, the coverage of the dependent shall become 27 effective: 28 (i) In the case of marriage, not later than the first day of the 29 first month beginning after the date the completed request for 30 enrollment is received; 31 (ii) In the case of a dependent's birth, as of the date of such 32 birth; or 33 (iii) In the case of a dependent's adoption or placement for adop- 34 tion, the date of such adoption or placement for adoption. 35 (18) "New business premium rate" means, for each class of business as to a 36 rating period, the lowest premium rate charged or offered or which could have 37 been charged or offered by the small employer carrier to small employers with 38 similar case characteristics for newly issued health benefit plans with the 39 same or similar coverage. 40 (19) "Plan of operation" means the plan of operation of the program estab- 41 lished pursuant to section 41-4711, Idaho Code. 42 (20) "Plan year" means the year that is designated as the plan year in the 43 plan document of a group health benefit plan, except that if the plan document 44 does not designate a plan year or if there is no plan document, the year plan 45 is: 46 (a) The deductible/limit year used under the plan; 47 (b) If the plan does not impose deductibles or limits on a yearly basis, 48 then the plan year is the policy year; 49 (c) If the plan does not impose deductibles or limits on a yearly basis 50 or the insurance policy is not renewed on an annual basis, then the plan 51 year is the employer's taxable year; or 52 (d) In any other case, the plan year is the calendar year. 53 (21) "Premium" means all moneys paid by a small employer and eligible 54 employees as a condition of receiving coverage from a small employer carrier, 55 including any fees or other contributions associated with the health benefit 25 1 plan. 2 (22) "Program" means the Idaho small employer reinsurance program created 3 in section 41-4711, Idaho Code. 4 (23) "Qualifying previous coverage" and "qualifying existing coverage" 5 meansbenefits or coverage provided under: 6 (a) Medicare or medicaid, civilian health and medical program for 7 uniformed services (CHAMPUS), the Indian health service program, a state 8 health benefit risk pool or any other similar publicly sponsored program; 9 or 10 (b) Any other group or individual health insurance policy or health bene- 11 fit arrangement whether or not subject to the state insurance laws, 12 including coverage provided by a health maintenance organization, hospital 13 or professional service corporation, or a fraternal benefit society, that 14 provides benefits similar to or exceeding benefits provided under the 15 basic health benefit plan. 16 (24) "Rating period" means the calendar period for which premium rates 17 established by a small employer carrier are assumed to be in effect. 18 (25) "Reinsuring carrier" means a small employer carrier participating in 19 the reinsurance program pursuant to section 41-4711, Idaho Code. 20 (26) "Restricted network provision" means any provision of a health bene- 21 fit plan that conditions the payment of benefits, in whole or in part, on the 22 use of health care providers that have entered into a contractual arrangement 23 with the carrier to provide health care services to covered individuals. 24 (27) "Risk-assuming carrier" means a small employer carrier whose applica- 25 tion is approved by the director pursuant to section 41-4710, Idaho Code. 26 (28) "Small employer" means any person, firm, corporation, partnership or 27 association that is actively engaged in business that,employed an average of 28 at least two (2) but no more than fifty (50) eligible employees on business 29 days during the preceding calendar year and that employs at least two (2) but 30 no more than fifty (50) eligible employees on the first day of the plan year, 31 the majority of whom were and are employed within this state. In determining 32 the number of eligible employees, companies that are affiliated companies, or 33 that are eligible to file a combined tax return for purposes of state taxa- 34 tion, shall be considered one (1) employer. 35 (29) "Small employer basic health benefit plan" means a lower cost health 36 benefit plan developed pursuant to section 41-4712, Idaho Code. 37 (30) "Small employer carrier" means a carrier that offers health benefit 38 plans covering eligible employees of one (1) or more small employers in this 39 state. 40 (31) "Small employer catastrophic health benefit plan" means a higher 41 limit health benefit plan developed pursuant to section 41-4712, Idaho Code. 42 (32) "Small employer standard health benefit plan" means a health benefit 43 plan developed pursuant to section 41-4712, Idaho Code. 44 SECTION 9. That Section 41-4933, Idaho Code, be, and the same is hereby 45 amended to read as follows: 46 41-4933. EXISTING INSURANCE LAWS TO APPLY TO THE TRUST FUND WITH CERTAIN 47 EXCEPTIONS. The trust fund shall comply with all of the applicable provisions 48 of title 41, Idaho Code, with certain exceptions as follows: 49 (1) The creation of the trust fund by act of the legislature shall not be 50 deemed to be an ownership, control or operation of an insurer by a governmen- 51 tal entity, as referred to in section 41-309, Idaho Code, and the surplus 52 funds of the trust fund shall be considered to be dedicated and held in 53 reserve for the purpose of providing funds for the payment of claims arising 26 1 out of the discharge of petroleum products from tanks covered by a contract of 2 insurance issued to the tank owner or operator by the trust fund as provided 3 for in section 41-4905, Idaho Code. The absolute control of the trust fund 4 shall be vested in the manager of the state insurance fund as trustee. 5 (2) The provisions of this chapter shall be construed to be contained in 6 the document of organization and bylaws of the trust fund for purposes of sec- 7 tions 41-319, 41-320 and 41-322, Idaho Code, and the director shall issue a 8 certificate of registration to and in the name of the trust fund upon his 9 finding that it has met all other appropriate provisions of the Idaho Code, 10 including sections 41-313, 41-316 and 41-316A, Idaho Code. 11 (3) Section 41-337, Idaho Code, shall not apply to contracts of insurance 12 issued by the trust fund. 13 (4) Sections 41-10304 and 41-1022, Idaho Code, shall not apply to employ- 14 ees of the state insurance fund or the trust fund. 15 (5) Section 41-1103, Idaho Code, shall not apply to employees of the 16 state insurance fund or the trust fund, provided the employees restrict their 17 claims adjusting and investigation operations only to those contracts issued 18 by the trust fund. 19 (6) Except as otherwise provided in this chapter, chapter 28, title 41, 20 Idaho Code, and chapter 14, title 30, Idaho Code, shall not apply to the trust 21 fund nor shall this trust fund be construed to be a domestic mutual insurer, 22 nor a reciprocal insurer, nor any other type of insurer currently regulated by 23 title 41, Idaho Code, and the only organizational requirements of this trust 24 fund shall be those enumerated in this chapter. 25 SECTION 10. That Section 41-5203, Idaho Code, be, and the same is hereby 26 amended to read as follows: 27 41-5203. DEFINITIONS. As used in this chapter: 28 (1) "Actuarial certification" means a written statement by a member of 29 the American academy of actuaries or other individual acceptable to the direc- 30 tor that an individual carrier is in compliance with the provisions of section 31 41-5206, Idaho Code, based upon the person's examination and including a 32 review of the appropriate records and the actuarial assumptions and methods 33 used by the individual carrier in establishing premium rates for applicable 34 health benefit plans. 35 (2) "Affiliate" or "affiliated" means any entity or person who directly 36 or indirectly through one (1) or more intermediaries, controls or is con- 37 trolled by, or is under common control with, a specified entity or person. 38 (3) "Agent" meansan agenta producer as defined in section 41-102139 03(9), Idaho Code, or a broker as defined in section 41-1024, Idaho Code. 40 (4) "Base premium rate" means, as to a rating period, the lowest premium 41 rate charged or that could have been charged under a rating system by the 42 individual carrier to individuals with similar case characteristics for health 43 benefit plans with the same or similar coverage. 44 (5) "Carrier" means any entity that provides health insurance in this 45 state. For purposes of this chapter, carrier includes an insurance company, a 46 hospital or professional service corporation, a fraternal benefit society, a 47 health maintenance organization, any entity providing health insurance cover- 48 age or benefits to residents of this state as certificate holders under a 49 group policy issued or delivered outside of this state, and any other entity 50 providing a plan of health insurance or health benefits subject to state 51 insurance regulation. 52 (6) "Case characteristics" means demographic or other objective charac- 53 teristics of an individual that are considered by the individual carrier in 27 1 the determination of premium rates for the individual, provided that claim 2 experience, health status and duration of coverage shall not be case charac- 3 teristics for the purposes of this chapter. 4 (7) "Control" shall be defined in the same manner as in section 5 41-3801(2), Idaho Code. 6 (8) "Dependent" means a spouse, an unmarried child under the age of nine- 7 teen (19) years, an unmarried child who is a full-time student under the age 8 of twenty-three (23) years and who is financially dependent upon the parent, 9 and an unmarried child of any age who is medically certified as disabled and 10 dependent upon the parent. 11 (9) "Director" means the director of the department of insurance of the 12 state of Idaho. 13 (10) "Eligible individual" means an Idaho resident individual or dependent 14 of an Idaho resident who is under the age of sixty-five (65) years, is not 15 eligible for coverage under a group health plan, part A or part B of title 16 XVIII of the social security act (medicare), or a state plan under title XIX 17 (medicaid) or any successor program, and who does not have other health insur- 18 ance coverage. An "eligible individual" can be the dependent of an eligible 19 employee, which eligible employee is receiving health insurance benefits sub- 20 ject to the regulation of title 41, Idaho Code. 21 (11) "Established geographic service area" means a geographic area, as 22 approved by the director and based on the carrier's certificate of authority 23 to transact insurance in this state, within which the carrier is authorized to 24 provide coverage. 25 (12) "Health benefit plan" means any hospital or medical policy or certif- 26 icate, any subscriber contract provided by a hospital or professional service 27 corporation, or health maintenance organization subscriber contract. Health 28 benefit plan does not include policies or certificates of insurance for spe- 29 cific disease, hospital confinement indemnity, accident-only, credit, dental, 30 vision, medicare supplement, long-term care, or disability income insurance, 31 student health benefits only, coverage issued as a supplement to liability 32 insurance, worker's compensation or similar insurance, automobile medical pay- 33 ment insurance, or nonrenewable short-term coverage issued for a period of 34 twelve (12) months or less. 35 (13) "Index rate" means, as to a rating period for individuals with simi- 36 lar case characteristics, the arithmetic average of the applicable base pre- 37 mium rate and the corresponding highest premium rate. 38 (14) "Individual basic health benefit plan" means a lower cost health ben- 39 efit plan developed pursuant to chapter 55, title 41, Idaho Code. 40 (15) "Individual catastrophic A health benefit plan" means a higher limit 41 health benefit plan developed pursuant to chapter 55, title 41, Idaho Code. 42 (16) "Individual catastrophic B health benefit plan" means a health bene- 43 fit plan with limits higher than an individual catastrophic A health benefit 44 plan developed pursuant to chapter 55, title 41, Idaho Code. 45 (17) "Individual standard health benefit plan" means a health benefit plan 46 developed pursuant to chapter 55, title 41, Idaho Code. 47 (18) "New business premium rate" means, as to a rating period, the lowest 48 premium rate charged or offered or which could have been charged or offered by 49 the individual carrier to individuals with similar case characteristics for 50 newly issued health benefit plans with the same or similar coverage. 51 (19) "Premium" means all moneys paid by an individual and eligible depend- 52 ents as a condition of receiving coverage from a carrier, including any fees 53 or other contributions associated with the health benefit plan. 54 (20) "Qualifying previous coverage" and "qualifying existing coverage" 55 meansbenefits or coverage provided under: 28 1 (a) Medicare or medicaid, civilian health and medical program for 2 uniformed services (CHAMPUS), the Indian health service program, a state 3 health benefit risk pool, or any other similar publicly sponsored program; 4 or 5 (b) Any group or individual health insurance policy or health benefit 6 arrangement whether or not subject to the state insurance laws, including 7 coverage provided by a managed care organization, hospital or professional 8 service corporation, or a fraternal benefit society, that provides bene- 9 fits similar to or exceeding benefits provided under the basic health ben- 10 efit plan. 11 (21) "Rating period" means the calendar period for which premium rates 12 established by a carrier are assumed to be in effect. 13 (22) "Reinsuring carrier" means a carrier participating in the Idaho indi- 14 vidual high risk reinsurance pool established in chapter 55, title 41, Idaho 15 Code. 16 (23) "Restricted network provision" means any provision of a health bene- 17 fit plan that conditions the payment of benefits, in whole or in part, on the 18 use of health care providers that have entered into a contractual arrangement 19 with the carrier to provide health care services to covered individuals. 20 (24) "Risk-assuming carrier" means a carrier whose application is approved 21 by the director pursuant to section 41-5210, Idaho Code. 22 (25) "Individual carrier" means a carrier that offers health benefit plans 23 covering eligible individuals and their dependents. 24 SECTION 11. That Section 41-5501, Idaho Code, be, and the same is hereby 25 amended to read as follows: 26 41-5501. DEFINITIONS. As used in this chapter: 27 (1) "Agent" meansan agenta producer as defined in section 41-102103(9), 28 Idaho Code, or a broker as defined in section 41-1024, Idaho Code. 29 (2) "Board" means the board of directors of the Idaho high risk individ- 30 ual reinsurance pool established in this chapter and the Idaho small employer 31 reinsurance program established in section 41-4711, Idaho Code. 32 (3) "Carrier" means any entity that provides health insurance in this 33 state. For purposes of this chapter, carrier includes an insurance company, 34 any other entity providing reinsurance including excess or stop loss coverage, 35 a hospital or professional service corporation, a fraternal benefit society, a 36 managed care organization, any entity providing health insurance coverage or 37 benefits to residents of this state as certificate holders under a group pol- 38 icy issued or delivered outside of this state, and any other entity providing 39 a plan of health insurance or health benefits subject to state insurance regu- 40 lation. 41 (4) "Dependent" means a spouse, an unmarried child under the age of nine- 42 teen (19) years, an unmarried child who is a full-time student under the age 43 of twenty-three (23) years and who is financially dependent upon the parent, 44 and an unmarried child of any age who is medically certified as disabled and 45 dependent upon the parent. 46 (5) "Director" means the director of the department of insurance of the 47 state of Idaho. 48 (6) "Eligible individual" means an Idaho resident individual or dependent 49 of an Idaho resident who is under the age of sixty-five (65) years, is not 50 eligible for coverage under a group health plan, part A or part B of title 51 XVIII of the social security act (medicare), or a state plan under title XIX 52 (medicaid) or any successor program, and who does not have other health insur- 53 ance coverage. Coverage under a basic, standard, catastrophic A or cata- 29 1 strophic B health benefit plan shall not be available to any individual who is 2 covered under other health insurance coverage. For purposes of this chapter, 3 to be eligible, an individual must also meet the requirements of section 4 41-5510, Idaho Code. 5 (7) "Health benefit plan" means any hospital or medical policy or certif- 6 icate, any subscriber contract provided by a hospital or professional service 7 corporation, or health maintenance organization subscriber contract. Health 8 benefit plan does not include policies or certificates of insurance for spe- 9 cific disease, hospital confinement indemnity, accident-only, credit, dental, 10 vision, medicare supplement, long-term care, or disability income insurance, 11 student health benefits only, coverage issued as a supplement to liability 12 insurance, worker's compensation or similar insurance, automobile medical pay- 13 ment insurance, or nonrenewable short-term coverage issued for a period of 14 twelve (12) months or less. 15 (8) "Individual basic health benefit plan" means a lower cost health ben- 16 efit plan developed pursuant to section 41-5511, Idaho Code. 17 (9) "Individual carrier" means a carrier that offers health benefit plans 18 covering eligible individuals and their dependents. 19 (10) "Individual catastrophic A health benefit plan" means a higher limit 20 health benefit plan developed pursuant to section 41-5511, Idaho Code. 21 (11) "Individual catastrophic B health benefit plan" means a health bene- 22 fit plan offering limits higher than a catastrophic A health benefit plan 23 developed pursuant to section 41-5511, Idaho Code. 24 (12) "Individual standard health benefit plan" means a health benefit plan 25 developed pursuant to section 41-5511, Idaho Code. 26 (13) "Plan" or "pool plan" means the individual basic, standard, cata- 27 strophic A or catastrophic B plan established pursuant to section 41-5511, 28 Idaho Code. 29 (14) "Plan of operation" means the plan of operation of the individual 30 high risk reinsurance pool established pursuant to this chapter. 31 (15) "Pool" means the Idaho high risk reinsurance pool. 32 (16) "Premium" means all moneys paid by an individual and eligible depend- 33 ents as a condition of receiving coverage from a carrier, including any fees 34 or other contributions associated with the health benefit plan. 35 (17) "Qualifying previous coverage" and "qualifying existing coverage" 36 meansbenefits or coverage provided under: 37 (a) Medicare or medicaid, civilian health and medical program for 38 uniformed services (CHAMPUS), the Indian health service program, a state 39 health benefit risk pool, or any other similar publicly sponsored program; 40 or 41 (b) Any group or individual health insurance policy or health benefit 42 arrangement whether or not subject to the state insurance laws, including 43 coverage provided by a managed care organization, hospital or professional 44 service corporation, or a fraternal benefit society, that provides bene- 45 fits similar to or exceeding benefits provided under the basic health ben- 46 efit plan. 47 (18) "Reinsurance premium" means the premium set by the board pursuant to 48 section 41-5506, Idaho Code, to be paid by a reinsuring carrier for plans 49 issued under the pool. 50 (19) "Reinsuring carrier" means a carrier participating in the individual 51 high risk reinsurance pool established by this chapter. 52 (20) "Restricted network provision" means any provision of a health bene- 53 fit plan that conditions the payment of benefits, in whole or in part, on the 54 use of health care providers that have entered into a contractual arrangement 55 with the carrier to provide health care services to covered individuals.
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature First Regular Session - 2001
Moved by Callister
Seconded by Gagner
IN THE HOUSE OF REPRESENTATIVES
HOUSE AMENDMENT TO H.B. NO. 35
1 AMENDMENTS TO SECTION 3
2 On page 17 of the printed bill, in line 51, delete "or"; and on page 18,
3 in line 2, delete "." and insert: "; or"; and following line 2, insert:
4 "(f) Anyone rendering services as an expert who would qualify as such
5 pursuant to the Idaho rules of evidence.".
Moved by Callister
Seconded by Gagner
IN THE HOUSE OF REPRESENTATIVES
HOUSE AMENDMENT TO H.B. NO. 35
6 AMENDMENTS TO SECTION 3
7 On page 15 of the printed bill, delete lines 20 through 23 and insert:
8 "(a) Any documents, materials or other information obtained by the direc-
9 tor in an investigation pursuant to this"; delete lines 25 through 35 and
10 insert: "disclosure under chapter 3, title 9, Idaho Code. However, the
11 director is authorized to use the documents, materials or other informa-
12 tion in the furtherance of any regulatory or legal action brought as a
13 part of the director's duties without court intervention."; and in line
14 36, delete "(c)" and insert: "(b)".
15 On page 16, in line 3, delete "(d)" and insert: "(c)"; in line 6, delete
16 "(c)" and insert: "(b)"; and in line 7, delete "(e)" and insert: "(d)".
Moved by Goedde
Seconded by Cameron
IN THE SENATE
SENATE AMENDMENT TO H.B. NO. 35, As Amended
17 AMENDMENTS TO SECTION 3
18 On page 4 of the engrossed bill, in line 5, delete "AND CONSULTANT";
19 delete lines 25 through 28; in line 29, delete "(3)" and insert: "(2)"; in
20 line 33, delete "(4)" and insert: "(3)"; in line 37, delete "(5)" and insert:
21 "(4)"; in line 47, delete "(6)" and insert: "(5)"; in line 49, delete "(7)"
22 and insert: "(6)"; on page 5, in line 3, delete "(8)" and insert: "(7)"; in
23 line 4, delete "(9)" and insert: "(8)"; in line 6, delete "(10)" and insert:
24 "(9)"; in line 8, delete "(11)" and insert: "(10)"; in line 10, delete "(12)"
25 and insert: "(11)"; in line 13, delete "(13)" and insert: "(12)"; in line 16,
26 delete "(14)" and insert: "(13)"; and in line 19, delete "(15)" and insert:
27 "(14)".
28 On page 6, in line 38, delete "or an insurance consultant license".
|||
2
1 On page 9, in line 18, delete "AND CONSULTANTS"; in line 19, delete "or
2 nonresident consultant"; in line 22, delete "or consultant"; in line 24,
3 delete "or consultant"; in line 36, delete "or consultant"; and in line 37,
4 delete "or consultant".
5 On page 10, in line 20, delete "consultant,"; in line 43, delete
6 "consultant,"; in line 48, delete "and resi-"; in line 49, delete "dent con-
7 sultants".
8 On page 11, in line 3, delete "or any consultant who is licensed pursuant
9 to"; in line 4, delete "section 41-1027, Idaho Code,"; in line 7, delete "and
10 41-1027 (qualifications for resident consultant license)".
11 On page 15, in line 21, delete ", shall be confidential"; in line 22,
12 delete "and privileged,"; in line 23, delete "However, the director is autho-
13 rized to use the docu-"; and delete lines 24 through 26.
14 On page 17, delete lines 15 through 52; on page 18, delete lines 1 through
15 53; on page 19, delete lines 1 through 42; in line 43, delete "41-1032" and
16 insert: "41-1025"; in line 46, delete "41-1033" and insert: "41-1026".
17 On page 20, in line 13, delete "41-1034" and insert: "41-1027"; in line
18 14, delete "consultant,"; in line 24, delete "41-1035" and insert: "41-1028";
19 also in line 24, delete "or consultant"; in line 38, delete "or consultant";
20 in line 41, delete "or consultant"; in line 43, delete "or consultant"; in
21 line 47, delete "or consultant"; and in line 51, delete "41-1036" and insert:
22 "41-1029".
23 AMENDMENT TO SECTION 5
24 On page 21, in line 36, delete "pro-"; in line 37, delete "ducers and con-
25 sultants" and insert: "and consultants producers".
26 CORRECTIONS TO TITLE
27 On page 1, in line 2, delete "AND INSURANCE CONSULTANT"; in line 14,
28 delete "AND CONSULTANTS"; delete lines 25 through 28; and in line 29, delete
29 "BY CONSULTANTS, TO PROVIDE FOR ERRORS AND OMISSIONS INSURANCE,".
|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-sixth Legislature First Regular Session - 2001IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 35, As Amended, As Amended in the Senate BY MR. SPEAKER Requested by: Department of Insurance 1 AN ACT 2 RELATING TO INSURANCE PRODUCER LICENSING; AMENDING SECTION 9-340B, IDAHO CODE, 3 TO CREATE A PUBLIC RECORDS EXEMPTION FOR RECORDS FURNISHED TO THE DEPART- 4 MENT OF INSURANCE REGARDING TERMINATION OF AN APPOINTMENT, EMPLOYMENT, 5 CONTRACT OR OTHER INSURANCE BUSINESS RELATIONSHIP BETWEEN AN INSURER AND A 6 PRODUCER; REPEALING CHAPTER 10, TITLE 41, IDAHO CODE; AMENDING TITLE 41, 7 IDAHO CODE, BY THE ADDITION OF A NEW CHAPTER 10, TITLE 41, IDAHO CODE, TO 8 PROVIDE FOR PURPOSE AND SCOPE, TO PROVIDE FOR MEANING OF TERMS, TO PROVIDE 9 FOR DEFINITIONS, TO PROVIDE FOR REQUIREMENT OF LICENSES, TO PROVIDE FOR 10 EXCEPTIONS TO LICENSING, TO PROVIDE FOR APPLICATIONS FOR EXAMINATIONS, TO 11 PROVIDE FOR APPLICATIONS FOR PRODUCER LICENSES, TO PROVIDE FOR PRODUCER 12 LICENSES, TO PROVIDE FOR NONRESIDENT PRODUCER LICENSES, TO PROVIDE FOR 13 SERVICE OF PROCESS FOR NONRESIDENT PRODUCERS, TO PROVIDE FOR ISSUANCE OF 14 AND REFUSAL TO ISSUE LICENSES, TO PROVIDE FOR EXEMPTION FROM EXAMINATION, 15 TO PROVIDE FOR CONTINUATION AND EXPIRATION OF LICENSES AND FOR CONTINUING 16 EDUCATION, TO PROVIDE FOR NOTIFICATION OF USE OF ASSUMED NAMES, TO PROVIDE 17 FOR TEMPORARY LICENSING, TO PROVIDE FOR ADMINISTRATIVE PENALTIES, SUSPEN- 18 SIONS, REVOCATIONS AND REFUSALS OF LICENSES, TO PROVIDE FOR COMMISSIONS, 19 TO PROVIDE FOR APPOINTMENTS, TO PROVIDE FOR NOTIFICATION TO DIRECTOR OF 20 TERMINATION, TO PROVIDE FOR RECIPROCITY, TO PROVIDE FOR REPORTING OF 21 ACTIONS, TO PROVIDE THAT INSURERS MUST ACCEPT BUSINESS THROUGH LICENSED 22 PRODUCERS ONLY, TO PROVIDE FOR COUNTERSIGNATURE OF POLICIES AND FOR GRANT- 23 ING OF POWER OF ATTORNEY, TO PROVIDE FOR REPORTING AND ACCOUNTING FOR PRE- 24 MIUMS, TO PROVIDE THAT THE DIRECTOR MAY PROMULGATE RULES, TO PROVIDE FOR 25 PROCEDURE FOLLOWING SUSPENSION, REVOCATION OR REFUSAL TO CONTINUE A 26 LICENSE AND FOR REINSTATEMENT, TO PROVIDE FOR RETURN OF LICENSES, TO PRO- 27 VIDE FOR INACTIVE STATUS AND TO PROVIDE THAT THE PROVISIONS OF THE CHAPTER 28 ARE SEVERABLE; AMENDING SECTION 41-1108, IDAHO CODE, TO PROVIDE CORRECT 29 REFERENCES AND CODE CITATIONS; AMENDING SECTION 41-1223, IDAHO CODE, TO 30 PROVIDE CORRECT TERMINOLOGY; AMENDING SECTION 41-1315A, IDAHO CODE, TO 31 DELETE A REFERENCE TO A CODE CITATION AND TO MAKE TECHNICAL CORRECTIONS; 32 AMENDING SECTION 41-3435, IDAHO CODE, TO PROVIDE CORRECT TERMINOLOGY, TO 33 PROVIDE THAT SERVICE CORPORATIONS MAY FILE APPOINTMENT OF AGENTS OR REPRE- 34 SENTATIVES, TO PROVIDE A CORRECT CODE CITATION AND TO MAKE TECHNICAL COR- 35 RECTIONS; AMENDING SECTION 41-4703, IDAHO CODE, TO REVISE A DEFINITION AND 36 TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 41-4933, IDAHO CODE, TO 37 PROVIDE CORRECT CODE CITATIONS; AMENDING SECTION 41-5203, IDAHO CODE, TO 38 REVISE A DEFINITION AND TO MAKE TECHNICAL CORRECTIONS; AND AMENDING SEC- 39 TION 41-5501, IDAHO CODE, TO REVISE A DEFINITION AND TO MAKE A TECHNICAL 40 CORRECTION. 41 Be It Enacted by the Legislature of the State of Idaho: 42 SECTION 1. That Section 9-340B, Idaho Code, be, and the same is hereby 43 amended to read as follows: 2 1 9-340B. RECORDS EXEMPT FROM DISCLOSURE -- LAW ENFORCEMENT RECORDS, INVES- 2 TIGATORY RECORDS OF AGENCIES, WORKER'S COMPENSATION. The following records are 3 exempt from disclosure: 4 (1) Investigatory records of a law enforcement agency, as defined in sec- 5 tion 9-337(6), Idaho Code, under the conditions set forth in section 9-335, 6 Idaho Code. 7 (2) Juvenile records of a person maintained pursuant to chapter 5, title 8 20, Idaho Code, except that facts contained in such records shall be furnished 9 upon request in a manner determined by the court to persons and governmental 10 and private agencies and institutions conducting pertinent research studies or 11 having a legitimate interest in the protection, welfare and treatment of the 12 juvenile who is thirteen (13) years of age or younger. If the juvenile is 13 petitioned or charged with an offense which would be a criminal offense if 14 committed by an adult, the name, offense of which the juvenile was petitioned 15 or charged and disposition of the court shall be subject to disclosure as pro- 16 vided in section 20-525, Idaho Code. Additionally, facts contained in any 17 records of a juvenile maintained under chapter 5, title 20, Idaho Code, shall 18 be furnished upon request to any school district where the juvenile is 19 enrolled or is seeking enrollment. 20 (3) (a) Until July 1, 2001, records of the department of correction to 21 the extent that disclosure thereof would interfere with the secure and 22 orderly conduct of their operations, or the rehabilitation of any person 23 in the custody of the department of correction, or would substantially 24 prejudice or prevent the carrying out of the functions of the department 25 of correction if the public interest in confidentiality clearly outweighs 26 the public interest in disclosure. Records exempt from disclosure shall 27 include, but not be limited to, those containing the names and addresses 28 of witnesses or victims or those containing information identifying vic- 29 tims or witnesses. 30 (b) Operation and security manuals, plans or codes of county jails and 31 buildings owned or leased by Idaho state government, a county or a city. 32 "Operation manuals" are those internal documents of any state government 33 agency, county or city building or jail that define the procedures uti- 34 lized to maintain security within the building or jail. "Plans or codes" 35 relate only to those documents, the release of which could jeopardize the 36 safety of workers in those buildings, or adversely affect the public 37 safety. 38 (c) Records of the commission of pardons and parole shall be exempt from 39 public disclosure pursuant to section 20-213A, Idaho Code, and section 40 20-223, Idaho Code. Records exempt from disclosure shall also include 41 those containing the names, addresses and written statements of victims. 42 (4) Voting records of the sexual offender classification board. In accor- 43 dance with section 18-8315, Idaho Code, the written record of the vote to 44 classify an offender as a violent sexual predator by each board member in each 45 case reviewed by that board member shall be exempt from disclosure to the pub- 46 lic and shall be made available upon request only to the governor, the chair- 47 man of the senate judiciary and rules committee, and the chairman of the house 48 of representatives judiciary, rules and administration committee, for all law- 49 ful purposes. 50 (5) Records of the sheriff or Idaho state police received or maintained 51 pursuant to section 18-3302, Idaho Code, relating to an applicant or licensee. 52 (6) Records of investigations prepared by the department of health and 53 welfare pursuant to its statutory responsibilities dealing with the protection 54 of children, the rehabilitation of youth, adoptions and the commitment of men- 55 tally ill persons. 3 1 (7) Records including, but not limited to, investigative reports, result- 2 ing from investigations conducted into complaints of discrimination made to 3 the Idaho human rights commission unless the public interest in allowing 4 inspection and copying of such records outweighs the legitimate public or pri- 5 vate interest in maintaining confidentiality of such records. A person may 6 inspect and copy documents from an investigative file to which he or she is a 7 named party if such documents are not otherwise prohibited from disclosure by 8 federal law or regulation or state law. The confidentiality of this subsection 9 will no longer apply to any record used in any judicial proceeding brought by 10 a named party to the complaint or investigation, or by the Idaho human rights 11 commission, relating to the complaint of discrimination. 12 (8) Records containing information obtained by the manager of the Idaho 13 state insurance fund pursuant to chapter 9, title 72, Idaho Code, from or on 14 behalf of employers or employees contained in underwriting and claims for ben- 15 efits files. 16 (9) The worker's compensation records of the Idaho industrial commission 17 provided that the industrial commission shall make such records available: 18 (a) To the parties in any worker's compensation claim and to the indus- 19 trial special indemnity fund of the state of Idaho; or 20 (b) To employers and prospective employers subject to the provisions of 21 the Americans with disabilities act, 42 U.S.C. 12112, or other statutory 22 limitations, who certify that the information is being requested with 23 respect to a worker to whom the employer has extended an offer of employ- 24 ment and will be used in accordance with the provisions of the Americans 25 with disabilities act, 42 U.S.C. 12112, or other statutory limitations; or 26 (c) To employers and prospective employers not subject to the provisions 27 of the Americans with disabilities act, 42 U.S.C. 12112, or other statu- 28 tory limitations, provided the employer presents a written authorization 29 from the person to whom the records pertain; or 30 (d) To others who demonstrate that the public interest in allowing 31 inspection and copying of such records outweighs the public or private 32 interest in maintaining the confidentiality of such records, as determined 33 by a civil court of competent jurisdiction. 34 (10) Records of investigations compiled by the commission on aging involv- 35 ing vulnerable adults, as defined in section 18-1505, Idaho Code, alleged to 36 be abused, neglected or exploited. 37 (11) Criminal history records and fingerprints, as defined by section 38 67-3001, Idaho Code, and compiled by the Idaho state police. Such records 39 shall be released only in accordance with chapter 30, title 67, Idaho Code. 40 (12) Records furnished or obtained pursuant to section 41-1019, Idaho 41 Code, regarding termination of an appointment, employment, contract or other 42 insurance business relationship between an insurer and a producer. 43 SECTION 2. That Chapter 10, Title 41, Idaho Code, be, and the same is 44 hereby repealed. 45 SECTION 3. That Title 41, Idaho Code, be, and the same is hereby amended 46 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap- 47 ter 10, Title 41, Idaho Code, and to read as follows: 48 CHAPTER 10 49 PRODUCER LICENSING 50 41-1001. PURPOSE AND SCOPE. (1) This chapter governs the qualifications 51 and procedures for the licensing of insurance producers. It simplifies and 4 1 organizes statutory language to improve efficiency, permits the use of new 2 technology and reduces costs associated with issuing and renewing insurance 3 licenses. 4 (2) This chapter applies to adjusters to the extent provided in section 5 41-1108, Idaho Code, and to surplus lines brokers to the extent provided in 6 sections 41-1223 and 41-1224, Idaho Code. Except where expressly made applica- 7 ble, this chapter does not apply to title insurance under chapter 27, title 8 41, Idaho Code. 9 41-1002. TERMS CONSTRUED. Wherever the terms "agent" or "broker" appear 10 in title 41, Idaho Code, or in the rules of the department, they shall be 11 understood and construed to mean "producer" as defined in section 41-1003(9), 12 Idaho Code, except as used in section 41-1018, Idaho Code, and any other sec- 13 tions where it is apparent from the language that the terms should not be so 14 construed. 15 41-1003. DEFINITIONS. (1) "Business entity" means a corporation, associa- 16 tion, partnership, limited liability company, limited liability partnership or 17 other legal entity. 18 (2) "Home state" means the District of Columbia and any state or terri- 19 tory of the United States or any province of Canada in which an insurance pro- 20 ducer maintains his or her principal place of residence or principal place of 21 business and is licensed to act as an insurance producer. 22 (3) "License" means a document issued by the director authorizing a per- 23 son to act as an insurance producer for the lines of authority specified in 24 the document. The license itself does not create any authority, actual, appar- 25 ent or inherent, in the holder to represent or commit an insurance carrier. 26 (4) "Limited lines insurance" is insurance which restricts the authority 27 of the license to less than the total authority prescribed in the associated 28 major lines pursuant to section 41-1008(1)(a) through (g), Idaho Code, and 29 shall include, but not be limited to: credit life, credit disability, credit 30 property, credit unemployment, involuntary unemployment, mortgage life, mort- 31 gage guaranty, mortgage disability, guaranteed automobile protection (GAP) 32 insurance, transportation baggage insurance, transportation ticket policies 33 covering personal accident insurance, pet insurance, or any other line of 34 insurance that the director deems necessary to recognize for the purposes of 35 complying with section 41-1009(5), Idaho Code. 36 (5) "Limited lines producer" means a producer authorized by the director 37 to sell, solicit or negotiate limited lines insurance. 38 (6) "Negotiate" means the act of conferring directly with or offering 39 advice directly to a purchaser or prospective purchaser of a particular con- 40 tract of insurance concerning any of the substantive benefits, terms or condi- 41 tions of the contract, provided that the person engaged in the act either 42 sells insurance or obtains insurance from insurers for purchasers. 43 (7) "Person" means an individual or a business entity. 44 (8) "Producer" means a person required to be licensed under the laws of 45 this state to sell, solicit or negotiate insurance. 46 (9) "Resident" means a person whose home state is Idaho or any other par- 47 ticular state identified in conjunction with the use of the term. 48 (10) "Sell" means to exchange a contract of insurance by any means, for 49 money or its equivalent, on behalf of an insurance company. 50 (11) "Solicit" means attempting to sell insurance or asking or urging a 51 person to apply for a particular kind of insurance from a particular company 52 or companies. 53 (12) "Terminate" means the cancellation of the relationship between an 5 1 insurance producer and the insurer or the termination of a producer's author- 2 ity to transact insurance for or on behalf of an insurer. 3 (13) "Uniform application" means the current version of the national asso- 4 ciation of insurance commissioners (NAIC) uniform application for resident and 5 nonresident producer licensing. 6 (14) "Uniform business entity application" means the current version of 7 the NAIC uniform business entity application for resident and nonresident 8 business entities. 9 41-1004. LICENSE REQUIRED. A person shall not sell, solicit or negotiate 10 insurance in this state for any class or classes of insurance unless the per- 11 son is licensed as a producer for that line of authority in accordance with 12 this chapter. 13 41-1005. EXCEPTIONS TO LICENSING. (1) Nothing in this chapter shall be 14 construed to require an insurer to obtain an insurance producer license. In 15 this section, the term "insurer" does not include an insurer's officers, 16 directors, employees, subsidiaries or affiliates. 17 (2) A license as an insurance producer shall not be required of the fol- 18 lowing: 19 (a) An officer, director or employee of an insurer or of an insurance 20 producer, provided that the officer, director or employee does not receive 21 any commission on policies written or sold to insure risks residing, 22 located or to be performed in this state and: 23 (i) The activities of the officer, director or employee are execu- 24 tive, administrative, managerial, clerical or a combination of these, 25 and are only indirectly related to the sale, solicitation or negotia- 26 tion of insurance; or 27 (ii) The function of the officer, director or employee relates to 28 underwriting, loss control, inspection or the processing, adjusting, 29 investigating or settling of a claim on a contract of insurance; or 30 (iii) The officer, director or employee is acting in the capacity of 31 a special agent or agency supervisor assisting insurance producers 32 where the person's activities are limited to providing technical 33 advice and assistance to licensed insurance producers and do not 34 include the sale, solicitation or negotiation of insurance; 35 (b) A person who secures and furnishes information for the purpose of 36 group life insurance, group property and casualty insurance, group annu- 37 ities, group or blanket accident and health insurance, or for the purpose 38 of enrolling individuals under plans, issuing certificates under plans or 39 otherwise assisting in administering plans, or performs administrative 40 services relating to mass-marketed property and casualty insurance, and 41 who does not receive a commission; 42 (c) An employer or association or its officers, directors, employees or 43 the trustees of an employee trust plan, to the extent that the employer, 44 association, officer, employee, director or trustee is engaged in the 45 administration or operation of a program of employee benefits for the 46 employer's or association's own employees or the employees of its subsid- 47 iaries or affiliates, which involves the use of insurance issued by an 48 insurer, as long as the employer, association, officer, director, employee 49 or trustee is not in any manner compensated, directly or indirectly, by 50 the company issuing the contracts; 51 (d) Employees of insurers or organizations employed by insurers who are 52 engaging in the inspection, rating or classification of risks, or in the 53 supervision of the training of insurance producers, and who are not indi- 6 1 vidually engaged in the sale, solicitation or negotiation of insurance, 2 and who do not receive a commission; 3 (e) A person whose activities in this state are limited to advertising 4 without the intent to solicit insurance in this state through communica- 5 tions in printed publications or other forms of electronic mass media 6 whose distribution is not limited to residents of the state, provided that 7 the person does not sell, solicit or negotiate insurance that would insure 8 risks residing, located or to be performed in this state; 9 (f) A person who is not a resident of this state who sells, solicits or 10 negotiates a contract of insurance for commercial property and casualty 11 risks to an insured with risks located in more than one (1) state insured 12 under that contract, provided that the person is otherwise licensed as an 13 insurance producer to sell, solicit or negotiate that insurance in the 14 state where the insured maintains its principal place of business and the 15 contract of insurance insures risks located in that state; 16 (g) A salaried full-time employee who counsels or advises his or her 17 employer relative to the insurance interests of the employer or of the 18 subsidiaries or business affiliates of the employer, provided that the 19 employee does not sell or solicit insurance or receive a commission; or 20 (h) A person who, concurrent with the rental of a motor vehicle, provides 21 contract options to the standard rental agreement which provides auto and 22 travel related coverages through authorized insurers during a rental 23 period not to exceed ninety (90) days. 24 41-1006. APPLICATION FOR EXAMINATION. (1) A resident individual applying 25 for an insurance producer license shall pass a written examination unless 26 exempt pursuant to section 41-1008(4), 41-1012, 41-1027(3) or 41-1028(2)(c), 27 Idaho Code. The examination shall test the knowledge of the individual con- 28 cerning the lines of authority for which application is made, the duties and 29 responsibilities of an insurance producer and the insurance laws and rules of 30 this state. Examinations required by this section shall be developed and con- 31 ducted under rules prescribed by the director of the department of insurance. 32 (2) Each individual applying for an examination shall remit a nonrefund- 33 able fee as promulgated by the director pursuant to section 41-401, Idaho 34 Code. 35 (3) An individual who fails to appear for the examination as scheduled or 36 who fails to pass the examination shall reapply for an examination and remit 37 all required fees and forms before being rescheduled for another examination. 38 (4) Applications for licensure not received by the department within one 39 hundred eighty (180) days of the successful completion of the examination 40 shall be denied. 41 41-1007. APPLICATION FOR PRODUCER LICENSE. (1) A person applying for a 42 resident insurance producer license shall make application to the director on 43 the uniform application and declare under penalty of refusal, suspension or 44 revocation of the license that the statements made in the application are 45 true, correct and complete to the best of the applicant's knowledge and 46 belief. Before approving the application, the director shall find that the 47 applicant: 48 (a) Is at least eighteen (18) years of age; 49 (b) Has submitted the applicant's fingerprints as may be required by the 50 director; 51 (c) Has not committed any act that is a ground for denial, suspension or 52 revocation of the license as set forth in title 41, Idaho Code; 53 (d) Has paid the fees prescribed by the director pursuant to section 7 1 41-401, Idaho Code; and 2 (e) Has successfully passed the examinations for the lines of authority 3 for which the applicant has applied. 4 (2) A business entity acting as an insurance producer is required to 5 obtain an insurance producer license. Application shall be made using the uni- 6 form business entity application. Before approving the application, the direc- 7 tor shall find that: 8 (a) The business entity has paid the fees prescribed by the director pur- 9 suant to section 41-401, Idaho Code; and 10 (b) The business entity has designated a licensed producer, who is an 11 individual responsible for the business entity's compliance with the 12 insurance laws and rules of this state. 13 (3) The director may require any documents which are reasonably necessary 14 to verify the information contained in an application. 15 (4) Each insurer that sells, solicits or negotiates any form of limited 16 line insurance shall provide to each individual whose duties will include 17 selling, soliciting or negotiating limited lines insurance a program of 18 instruction that may be required to be approved by the director. If acceptable 19 to the director, and as stated by rule, the program of instruction may be 20 administered in place of the examination as required in section 41-1006, Idaho 21 Code. In addition, such course of instruction may be administered in place of 22 any continuing education requirements pursuant to section 41-1013, Idaho Code. 23 41-1008. PRODUCER LICENSE. (1) Unless denied licensure pursuant to sec- 24 tion 41-1016, Idaho Code, persons who have met the requirements of sections 25 41-1006 and 41-1007, Idaho Code, shall be issued an insurance producer 26 license. An insurance producer may receive qualification for a license in one 27 (1) or more of the following lines of authority: 28 (a) Life insurance coverage on human lives, including benefits of endow- 29 ment and annuities, benefits in the event of death or dismemberment by 30 accident, and benefits for disability income; 31 (b) Disability, including accident and health or sickness insurance cov- 32 erage for sickness, bodily injury or accidental death and benefits for 33 disability income; 34 (c) Property insurance coverage for the direct or consequential loss or 35 damage to property of every kind; 36 (d) Casualty insurance coverage against legal liability, including lia- 37 bility for death, injury or disability or damage to real or personal prop- 38 erty; 39 (e) Variable life and variable annuity products, meaning insurance cover- 40 age provided under variable life insurance contracts and variable annu- 41 ities; 42 (f) Personal lines, meaning property and casualty insurance coverage sold 43 to individuals and families for primarily noncommercial purposes; 44 (g) Any other line of insurance permitted under state laws or rules. 45 (2) An insurance producer license shall remain in effect unless revoked 46 or suspended as long as the renewal fee promulgated by the director pursuant 47 to section 41-401, Idaho Code, is paid and the continuing education require- 48 ments for resident insurance producers are met in accordance with section 49 41-1013, Idaho Code. 50 (3) An individual insurance producer who allows his or her license to 51 lapse may, within twelve (12) months from the due date of the renewal fee, 52 reinstate the same license without passing a written examination unless the 53 licensee would otherwise be required to retest under section 41-1013(7), Idaho 54 Code. However, a penalty in the amount of double the unpaid renewal fee shall 8 1 be required for any renewal fee received after the due date. 2 (4) A licensed insurance producer who is unable to comply with license 3 renewal procedures due to military service or some other extenuating circum- 4 stance, such as a long-term medical disability, may request that the director 5 waive those procedures. The producer may also request a waiver of any examina- 6 tion requirement or any other fine or sanction imposed for failure to comply 7 with renewal procedures. 8 (5) The license shall contain the licensee's name, address, personal 9 identification number, the date of issuance, the lines of authority, the expi- 10 ration date and any other information the director deems necessary. 11 (6) Licensees shall inform the director by any means acceptable to the 12 director of a change of address within thirty (30) days of the change. A busi- 13 ness entity licensed as a producer shall inform the director by any means 14 acceptable to the director of any change in ownership, officers, directors or 15 the designated licensed producer responsible for compliance pursuant to sec- 16 tion 41-1007(2)(b), Idaho Code. 17 (7) In order to assist in the performance of the director's duties, the 18 director may contract with nongovernmental entities, including the national 19 association of insurance commissioners or its affiliates or subsidiaries, to 20 perform any ministerial functions related to producer licensing, including the 21 collection of fees, that the director and the nongovernmental entity may deem 22 appropriate. 23 41-1009. NONRESIDENT PRODUCER LICENSE. (1) Unless denied licensure pursu- 24 ant to section 41-1016, Idaho Code, a nonresident applicant shall receive a 25 nonresident producer license if: 26 (a) The applicant is currently licensed as a resident and in good stand- 27 ing in his or her home state; 28 (b) The applicant has submitted the proper request for licensure and has 29 paid the fees set forth by rule pursuant to section 41-401, Idaho Code; 30 (c) The applicant has submitted or transmitted to the director the appli- 31 cation for licensure that the applicant submitted to his or her home state 32 or, in lieu of such application, a completed uniform application; 33 (d) The applicant has submitted the applicant's fingerprints, if required 34 by the director, on a form as prescribed by the director; and 35 (e) The applicant's home state awards nonresident producer licenses to 36 residents of this state on the same basis. 37 (2) The director may verify the producer's licensing status through the 38 producer database maintained by the national association of insurance commis- 39 sioners, its affiliates or subsidiaries, or by any other acceptable means. 40 (3) A nonresident producer who moves from one state to another state or a 41 resident producer who moves from this state to another state shall file a 42 change of address and provide certification from the new resident state within 43 thirty (30) days of the change of legal residence. No fee or license applica- 44 tion shall be required for filing the change of address. 45 (4) Notwithstanding any other provision of this chapter, a person 46 licensed as a surplus lines broker in his or her home state shall receive a 47 nonresident surplus lines broker license pursuant to subsection (1) of this 48 section. Except as to subsection (1) of this section, nothing in this section 49 otherwise amends or supersedes any provision of section 41-1223, Idaho Code. 50 (5) Notwithstanding any other provision of this chapter, a person 51 licensed as a limited lines producer in his or her home state shall receive a 52 nonresident limited lines producer license, pursuant to subsection (1) of this 53 section, granting the same scope of authority as granted under the license 54 issued by the producer's home state. For the purposes of this subsection, lim- 9 1 ited lines insurance is any authority granted by the home state which 2 restricts the authority of the license to less than the total authority pre- 3 scribed in the associated major lines pursuant to section 41-1008(1)(a) 4 through (g), Idaho Code. 5 41-1010. NONRESIDENT PRODUCERS -- SERVICE OF PROCESS. (1) Each person 6 applying to be a nonresident producer shall, on a form prescribed by the 7 director, appoint the director as his agent for purposes of receiving service 8 of legal process issued against the producer in this state upon causes of 9 action arising within this state out of transactions under the license. Ser- 10 vice upon the director as an agent shall constitute effective legal service 11 upon the producer. 12 (2) The appointment shall be irrevocable for as long as there could be 13 any cause of action against the licensee arising out of his insurance transac- 14 tions in or with respect to this state. 15 (3) Duplicate copies of such legal process against the licensee shall be 16 served upon the director by a person competent to serve a summons. At the 17 time of service the plaintiff shall pay the director an appropriate fee to be 18 determined by rule and not exceeding thirty dollars ($30.00). 19 (4) Upon receiving such service, the director shall send one (1) copy of 20 the process by registered or certified mail with return receipt requested to 21 the defendant licensee at his last address of record with the director. 22 (5) The director shall keep a record of the day and hour of such service 23 upon him. No proceedings shall be brought against the producer, and the pro- 24 ducer shall not be required to appear, plead or answer until the expiration of 25 thirty (30) days after the date of service upon the director. 26 41-1011. ISSUANCE -- REFUSAL OF LICENSE. If after completion of applica- 27 tion for a license, the taking and passing of any examination required under 28 this chapter and, if required by the director, receipt of a report from the 29 federal bureau of investigation based on the fingerprints of the applicant, 30 the director finds that the applicant has fully met the requirements for a 31 license, the director shall issue the license to the applicant; otherwise, the 32 director shall refuse to issue the license and shall promptly notify the 33 applicant and any appointing insurer or insurers of such refusal and state the 34 grounds for the refusal. Pending the receipt of the report from the federal 35 bureau of investigation, the director may, in his discretion, issue a tempo- 36 rary license if all other qualifications have been met. 37 41-1012. EXEMPTION FROM EXAMINATION. (1) An individual who applies for an 38 insurance producer license in this state and who was previously licensed for 39 the same lines of authority in another state shall not be required to complete 40 any prelicensing examination if: 41 (a) The person is currently licensed in another state; or 42 (b) The application is received within ninety (90) days of the cancella- 43 tion of the applicant's previous license and the prior state issues a cer- 44 tification that: 45 (i) At the time of cancellation, the applicant was in good standing 46 in that state; or 47 (ii) The state's producer database records, as maintained by the 48 national association of insurance commissioners or its affiliates or 49 subsidiaries, indicate that the producer is or was licensed in good 50 standing for the lines of authority requested. 51 (2) A person licensed as an insurance producer in another state who moves 52 to this state shall make application within ninety (90) days of establishing 10 1 legal residence to become a resident licensee pursuant to section 41-1006, 2 Idaho Code. No examination shall be required of that person to obtain any line 3 of authority previously held in the prior state unless the director provides 4 otherwise by rule. 5 41-1013. CONTINUATION -- EXPIRATION OF LICENSES -- CONTINUING EDUCATION 6 STATEMENT. (1) All producer, adjuster, and surplus line broker licenses issued 7 under this code shall continue in force until expired, suspended, revoked or 8 otherwise terminated, subject to payment of the applicable continuation fee on 9 or before the expiration date referred to in subsection (2) of this section, 10 accompanied by a written request for such continuation and a continuing educa- 11 tion statement verifying that the licensee has completed any continuing educa- 12 tion requirements imposed by the director. An application for renewal is not 13 complete unless it is submitted with both the applicable fee and the completed 14 continuing education statement. Requests for continuation shall be made in 15 writing on forms to be prescribed by the director. 16 (2) The director may fix the dates of expiration for licenses in such 17 manner as is deemed by him to be advisable for an efficient distribution of 18 the workload of his office. If the expiration date for a particular license or 19 appointment would shorten the period for which the license or appointment con- 20 tinuation fee has been paid, no refund of an unearned fee shall be made. If 21 the expiration date for a particular license or appointment would lengthen the 22 period for which a license or appointment continuation fee has been paid, the 23 director shall charge no additional fee for such lengthened period. 24 (3) Any license referred to in subsection (1) of this section for which 25 no request for continuation, fee and completed continuing education statement 26 are timely received by the director shall be deemed to have expired at mid- 27 night on the applicable expiration date. 28 (4) All sums tendered as fees for continuations of licenses as producer, 29 limited lines producer, adjuster or surplus line broker shall be deemed earned 30 when paid and shall not be subject to refund, except that the director shall 31 refund any duplicate payment of fees. 32 (5) For the protection of the people of this state the director shall 33 establish, by rule, additional educational requirements designed to maintain 34 and improve the insurance skills and knowledge of resident producers after 35 licensure by the department of insurance. The director shall also establish, 36 by rule, an advisory committee comprised of representatives from each segment 37 of the insurance industry to assist the director in prescribing additional 38 educational requirements. Such rules promulgated by the director shall include 39 limits on the terms of service for members of the committee. 40 (6) Subject to subsection (3) of this section, the director shall not 41 permit to be continued the license of any producer who is licensed pursuant to 42 section 41-1007, Idaho Code, who is a resident of this state, unless such per- 43 son has demonstrated to the satisfaction of the director that in addition to 44 meeting the standards contained in sections 41-1007, (qualifications for pro- 45 ducer license), Idaho Code, as may be applicable, all the additional educa- 46 tional requirements as the director may prescribe by rule have been met. 47 (7) Failure of the licensee to comply with any applicable additional edu- 48 cation requirements prescribed by the director by rule by the expiration date 49 of the license shall be grounds for the director to refuse to continue any 50 such license. The licensee may reinstate his or her license by submitting 51 proof of all education requirements within ninety (90) days from the date of 52 expiration of the license and by submitting an additional administrative pen- 53 alty of one hundred dollars ($100) for a delinquency of one (1) day to thirty 54 (30) days, two hundred dollars ($200) for a delinquency of thirty-one (31) 11 1 days to sixty (60) days, and three hundred dollars ($300) for a delinquency of 2 sixty-one (61) days to ninety (90) days. Following the ninetieth day from the 3 date of nonrenewal of the license and up to one (1) year from the nonrenewal 4 date, the licensee must complete all requirements for licensure including 5 retesting, submission of a new application and payment of all new licensing 6 fees. In addition, the individual must submit proof of completion of the 7 required education requirements for the licensing period in which the license 8 was terminated. After the license has been expired for one (1) year or more, 9 the individual must reapply and retest as a new applicant. 10 41-1014. ASSUMED NAMES. An insurance producer doing business under any 11 name other than the producer's legal name is required to notify the director 12 in writing prior to using the assumed name. 13 41-1015. TEMPORARY LICENSING. (1) The director may issue a temporary 14 insurance producer license for a period not to exceed one hundred eighty (180) 15 days without requiring an examination if the director deems that the temporary 16 license is necessary for the servicing of an insurance business in the follow- 17 ing cases: 18 (a) To the surviving spouse or court-appointed personal representative of 19 a licensed insurance producer who dies or becomes mentally or physically 20 disabled in order to allow adequate time for the sale of the insurance 21 business owned by the producer or for the recovery or return of the pro- 22 ducer to the business or to provide for the training and licensing of new 23 personnel to operate the producer's business; 24 (b) To a member or employee of a business entity licensed as an insurance 25 producer upon the death or disability of an individual designated in the 26 business entity application or the license; 27 (c) To the designee of a licensed insurance producer entering active ser- 28 vice in the armed forces of the United States of America; or 29 (d) Pursuant to section 41-1011, Idaho Code, or in any other circumstance 30 where the director deems the public interest will best be served by the 31 issuance of the temporary license. 32 (2) The director may by order limit the authority of any temporary licen- 33 see in any way deemed necessary to protect insureds and the public. The direc- 34 tor may require the temporary licensee to have a suitable sponsor who is a 35 licensed producer or insurer and who assumes responsibility for all actions of 36 the temporary licensee, and may impose other similar requirements designed to 37 protect insureds and the public. The director may by order revoke a temporary 38 license, without the right to a prior hearing, if the interests of insureds or 39 the public are endangered. A temporary license may not continue after the 40 owner or the personal representative disposes of the business. 41 41-1016. ADMINISTRATIVE PENALTY -- SUSPENSION, REVOCATION, REFUSAL OF 42 LICENSE. (1) The director may impose an administrative penalty not to exceed 43 one thousand dollars ($1,000), for deposit in the general fund of the state of 44 Idaho, and may suspend for not more than twelve (12) months or may revoke or 45 refuse to issue or continue any license issued under this chapter, chapter 27, 46 title 41, Idaho Code (title insurance), chapter 11, title 41, Idaho Code 47 (adjusters), or any surplus lines broker license if, after a hearing held on 48 not less than twenty (20) days' notice of such hearing and of the charges 49 against the licensee given as provided in section 41-212(3), Idaho Code, to 50 the licensee and to any appointing insurers represented (as to a producer who 51 is appointed as an agent), the director finds that as to the licensee any one 52 (1) or more of the following causes or violations exist: 12 1 (a) Providing incorrect, misleading, incomplete or materially untrue 2 information in the license application; 3 (b) Violating any provision of title 41, Idaho Code, department rule, 4 subpoena or order of the director or of another state's insurance direc- 5 tor; 6 (c) Obtaining or attempting to obtain a license through misrepresentation 7 or fraud; 8 (d) Improperly withholding, misappropriating or converting any moneys or 9 properties received in the course of doing insurance business; 10 (e) Misrepresenting the terms of an actual or proposed insurance contract 11 or application for insurance or misrepresenting any fact material to any 12 insurance transaction or proposed transaction; 13 (f) Being convicted of or pleading guilty to any felony, or to a misde- 14 meanor which evidences bad moral character, dishonesty, a lack of integ- 15 rity and financial responsibility, or an unfitness and inability to pro- 16 vide acceptable service to the consuming public; 17 (g) Admitting or being found to have committed any insurance unfair trade 18 practice or fraud; 19 (h) Using fraudulent, coercive or dishonest practices, or demonstrating 20 incompetence, untrustworthiness or financial irresponsibility, or being a 21 source of injury and loss to the public or others, in the conduct of busi- 22 ness in this state or elsewhere; 23 (i) Having an insurance license denied, suspended or revoked in any other 24 state, province, district or territory; 25 (j) Forging another's name on an application for insurance or on any doc- 26 ument related to an insurance transaction; 27 (k) Improperly using notes or any other reference material to complete an 28 examination for an insurance license; 29 (l) Knowingly accepting insurance business from an individual who is not 30 licensed; 31 (m) Failing to comply with an administrative or court order imposing a 32 child support obligation, provided however, that nothing in this provision 33 shall be deemed to abrogate or modify chapter 14, title 7, Idaho Code; or 34 (n) Failing to pay state income tax or to comply with any administrative 35 or court order directing payment of state income tax. 36 (2) The director shall, without hearing, suspend for not more than twelve 37 (12) months, or shall revoke or refuse to continue any license issued under 38 this chapter to a nonresident where the director has received a final order of 39 suspension, revocation or refusal to continue from the insurance regulatory 40 official or court of jurisdiction of the licensee's home state. If cause under 41 this provision exists after the expiration of the twelve (12) months, succes- 42 sive suspensions may be imposed by the director without hearing. 43 (3) In the event that the director denies or refuses to renew an applica- 44 tion for a license, the director shall notify the applicant or licensee and 45 advise, in writing, the applicant or licensee of the reason for the denial or 46 nonrenewal of the applicant's or licensee's license. The applicant or licensee 47 may make written demand upon the director within twenty-one (21) days for a 48 hearing before the director to determine the reasonableness of the director's 49 action. The hearing shall be held pursuant to chapter 2, title 41, and chapter 50 52, title 67, Idaho Code. 51 (4) The license of a business entity may be suspended, revoked or refused 52 if the director finds, after hearing, that the violation of an individual 53 licensee, who is registered to or acting on behalf of the business entity, was 54 known or should have been known by one (1) or more of the owners, officers or 55 managers acting on behalf of the business entity and that the violation was 13 1 not reported to the director and no corrective action was taken. 2 (5) In addition to or in lieu of any applicable denial, suspension or 3 revocation of a license, a person may, after hearing, be subject to a civil 4 fine or administrative penalty pursuant to subsection (1) of this section or 5 any other applicable section. 6 (6) The director shall retain the authority to enforce the provisions of 7 and impose any penalty or remedy authorized by title 41, Idaho Code, against 8 any person who is under investigation for or charged with a violation of title 9 41, Idaho Code, or department rule, even if the person's license or registra- 10 tion has been surrendered, has lapsed by operation of law, or if the person 11 has never been licensed. 12 41-1017. COMMISSIONS. (1) An insurance company or insurance producer 13 shall not pay a commission, service fee or other valuable consideration to a 14 person for selling, soliciting or negotiating insurance in this state if that 15 person is not duly licensed as required under this chapter. 16 (2) A person shall not accept a commission, service fee or other valuable 17 consideration for selling, soliciting or negotiating insurance in this state 18 if that person is not duly licensed as required under this chapter. 19 (3) Renewals or other deferred commissions may be paid to a person for 20 selling, soliciting or negotiating insurance in this state if that person was 21 duly licensed as required under this chapter at the time of the sale, solici- 22 tation or negotiation. 23 (4) An insurer or insurance producer may pay or assign commissions, ser- 24 vice fees or other valuable consideration to any person, regardless of whether 25 that person is licensed as a producer, unless the payment or assignment would 26 violate a specific section of title 41, Idaho Code, including, but not limited 27 to, sections 41-1314 and 41-2708, Idaho Code, or department rule. 28 41-1018. APPOINTMENTS. (1) An insurance producer shall not act as an 29 agent of an insurer unless the insurance producer becomes an appointed agent 30 of that insurer. An insurance producer who is not acting as an agent of an 31 insurer is not required to become appointed. 32 (2) To appoint a producer as its agent, the appointing insurer shall 33 file, in a format approved by the director, a notice of appointment within 34 fifteen (15) days from the date the agency contract is executed or the first 35 insurance application is submitted. 36 (3) Upon receipt of the notice of appointment, the director shall verify, 37 within a reasonable time not to exceed thirty (30) days, that the insurance 38 producer is eligible for appointment. If the insurance producer is determined 39 to be ineligible for appointment, the director shall notify the insurer within 40 five (5) days of his determination. 41 41-1019. NOTIFICATION TO DIRECTOR OF TERMINATION. (1) An insurer or 42 authorized representative of the insurer that terminates the appointment, 43 employment, contract or other insurance business relationship with a producer 44 shall notify the director within thirty (30) days following the effective date 45 of the termination, using a format prescribed by the director, if the reason 46 for termination is one of the reasons set forth in section 41-1016, Idaho 47 Code, or the insurer has knowledge that the producer was found by a court, 48 governmental body or self-regulatory organization authorized by law to have 49 engaged in any of the activities set forth in section 41-1016, Idaho Code. 50 Upon the written request of the director, the insurer shall provide additional 51 information, documents, records or other data pertaining to the termination or 52 activity of the producer. 14 1 (2) An insurer or authorized representative of the insurer that termi- 2 nates the appointment, employment, contract or other insurance business rela- 3 tionship with a producer for any reason not set forth in section 41-1016, 4 Idaho Code, shall notify the director within thirty (30) days following the 5 effective date of the termination, using a format prescribed by the director. 6 Upon written request of the director, the insurer shall provide additional 7 information, documents, records or other data pertaining to the termination. 8 (3) The insurer or authorized representative of the insurer shall 9 promptly notify the director in a format acceptable to the director if, upon 10 further review or investigation, the insurer discovers additional information 11 that would have been reportable to the director in accordance with subsection 12 (1) of this section. 13 (4) A copy of any notification shall be provided to the producer as fol- 14 lows: 15 (a) Within fifteen (15) days after making the notification required by 16 subsections (1), (2) and (3) of this section, the insurer shall mail a 17 copy of the notification to the producer at his or her last known address. 18 If the producer is terminated for cause for any other reasons listed in 19 section 41-1016, Idaho Code, the insurer shall provide a copy of the noti- 20 fication to the producer at his or her last known address by certified 21 mail, return receipt requested, postage prepaid or by overnight delivery 22 using a nationally recognized carrier. 23 (b) Within thirty (30) days after the producer has received the original 24 or additional notification, the producer may file written comments con- 25 cerning the substance of the notification with the director. The producer 26 shall, by the same means, simultaneously send a copy of the comments to 27 the reporting insurer, and the comments shall become a part of the 28 director's file and shall accompany every copy of a report distributed or 29 disclosed for any reason about the producer as permitted under subsection 30 (6) of this section. 31 (5) Immunities. 32 (a) In the absence of actual malice, an insurer, the authorized represen- 33 tative of the insurer, a producer, the director, or an organization of 34 which the director is a member and that compiles information and makes it 35 available to other insurance directors or regulatory or law enforcement 36 agencies, shall not be subject to civil liability, and a civil cause of 37 action of any nature shall not arise against these entities or their 38 respective agents or employees as a result of any statement or information 39 required by or provided pursuant to this section or any information relat- 40 ing to any statement that may be requested in writing by the director from 41 an insurer or producer or as a result of any statement by a terminating 42 insurer or producer to an insurer or producer limited solely and exclu- 43 sively to whether a termination for cause under subsection (1) of this 44 section was reported to the director, provided that the propriety of any 45 termination for cause under subsection (1) of this section is certified in 46 writing by an officer or authorized representative of the insurer or pro- 47 ducer terminating the relationship. 48 (b) In any action brought against a person that may have immunity under 49 paragraph (a) of this subsection for making any statement required by this 50 section or providing any information relating to any statement that may be 51 requested by the director, the party bringing the action shall plead spe- 52 cifically in any allegation that paragraph (a) of this subsection does not 53 apply because the person making the statement or providing the information 54 did so with actual malice. 55 (c) Paragraph (a) or (b) of this subsection shall not abrogate or modify 15 1 any existing statutory or common law privileges or immunities. 2 (6) Confidentiality. 3 (a) Any documents, materials or other information obtained by the direc- 4 tor in an investigation pursuant to this section shall be exempt from pub- 5 lic disclosure under chapter 3, title 9, Idaho Code. 6 (b) In order to assist in the performance of the director's duties under 7 this chapter, the director: 8 (i) May share documents, materials or other information, including 9 confidential and privileged documents and materials or information 10 subject to paragraph (a) of this subsection, with other state, fed- 11 eral and international regulatory agencies and law enforcement 12 authorities, and with the national association of insurance commis- 13 sioners, its affiliates or subsidiaries, provided that the recipient 14 agrees to maintain the confidentiality and privileged status of the 15 documents, materials or other information; 16 (ii) May receive documents, materials or information, including 17 otherwise confidential and privileged documents, materials or infor- 18 mation, from the national association of insurance commissioners, its 19 affiliates or subsidiaries and from regulatory agencies and law 20 enforcement authorities of other foreign or domestic jurisdictions, 21 and shall maintain as confidential or privileged any documents, mate- 22 rials or information received with notice or with the understanding 23 that they are confidential or privileged under the laws of the juris- 24 diction that is the source of the documents, materials or informa- 25 tion; and 26 (iii) May enter into agreements governing sharing and use of informa- 27 tion consistent with this subsection. 28 (c) No waiver of any applicable privilege or claim of confidentiality in 29 the documents, materials or information shall occur as a result of disclo- 30 sure to the director under this section or as a result of sharing as 31 authorized in paragraph (b) of this subsection. 32 (d) Nothing in this chapter shall prohibit the director from releasing 33 final adjudicated actions, including for cause terminations that are open 34 to public inspection pursuant to chapter 3, title 9 and title 41, Idaho 35 Code, to a database or other clearinghouse service maintained by the 36 national association of insurance commissioners or its affiliates or sub- 37 sidiaries. 38 (7) Penalties for failing to report. An insurer, the authorized represen- 39 tative of the insurer, or a producer who fails to report as required under the 40 provisions of this section or who is found by a court of competent jurisdic- 41 tion to have reported with actual malice may, after notice and hearing, have 42 his license or certificate of authority suspended or revoked and may be fined 43 in accordance with section 41-1016 or 41-327, Idaho Code. 44 41-1020. RECIPROCITY. (1) The director shall waive any requirements, 45 except the requirements imposed by section 41-1009, Idaho Code, for a nonresi- 46 dent producer license applicant with a valid license from his or her home 47 state if the applicant's home state awards nonresident licenses to residents 48 of this state on the same basis. 49 (2) A nonresident producer's satisfaction of his or her home state's con- 50 tinuing education requirements for licensed insurance producers shall consti- 51 tute satisfaction of this state's continuing education requirements if the 52 nonresident producer's home state recognizes the satisfaction of its continu- 53 ing education requirements imposed upon producers from this state on the same 54 basis. 16 1 41-1021. REPORTING OF ACTIONS. (1) A producer shall report to the direc- 2 tor any administrative action taken against the producer in another jurisdic- 3 tion or by another governmental agency within thirty (30) days of the final 4 disposition of the matter. This report shall include a copy of the order, con- 5 sent order or other relevant legal documents. 6 (2) Within thirty (30) days of the initial pretrial hearing date, a pro- 7 ducer shall report to the director any criminal prosecution of the producer 8 taken in any jurisdiction. The report shall include a copy of the initial com- 9 plaint filed, the order resulting from the hearing and any other relevant 10 legal documents. 11 41-1022. INSURERS MUST ACCEPT BUSINESS THROUGH LICENSED PRODUCERS ONLY. 12 (1) No authorized insurer shall make, write, place or cause to be made, writ- 13 ten or placed in this state any policy, duplicate policy, or insurance con- 14 tract of any kind, covering a subject of insurance resident, located or to be 15 performed in this state through any person who is not then licensed as a pro- 16 ducer under this chapter. 17 (2) The director may penalize, suspend or revoke the certificate of 18 authority of any insurer violating this section in accordance with section 19 41-327(1), Idaho Code. 20 41-1023. COUNTERSIGNATURE OF POLICIES -- POWER OF ATTORNEY. (1) When the 21 signature or countersignature of a property or casualty producer is required 22 on an insurance contract, or rider or endorsement thereto, the producer shall, 23 except as provided in section 41-337(1), Idaho Code, and subsection (2) of 24 this section, affix his original written signature thereon. 25 (2) The property or casualty producer may grant a power of attorney in 26 writing to an individual who is twenty-one (21) years of age or older, autho- 27 rizing such person to countersign or cause a facsimile of the agent's signa- 28 ture to be placed on policies and endorsements in his name and on his behalf. 29 The power of attorney shall be acknowledged by the agent under oath before a 30 notary public and shall be kept on file in the agent's office. 31 41-1024. REPORTING AND ACCOUNTING FOR PREMIUMS. (1) All premiums or 32 return premiums received by a producer shall be trust funds received by the 33 producer in a fiduciary capacity, and the producer shall, in the applicable 34 regular course of business, account for and pay the same to the insured, 35 insurer or producer entitled to the funds. If the producer establishes a sepa- 36 rate deposit for funds belonging to others in order to avoid a commingling of 37 such fiduciary funds with his own funds, he may deposit and commingle in such 38 separate deposit all funds belonging to others so long as the amount of such 39 deposit so held for all other persons is reasonably ascertainable from the 40 records and accounts of the producer. 41 (2) Any producer who, not being lawfully entitled thereto, diverts or 42 appropriates to his own use such trust or fiduciary funds or any portion 43 thereof, whether or not such funds have been separately deposited, shall upon 44 conviction be guilty of a felony. 45 41-1025. RULES. The director may, in accordance with section 41-211, 46 Idaho Code, promulgate reasonable rules as are necessary or proper to carry 47 out the purposes of this chapter. 48 41-1026. PROCEDURE FOLLOWING SUSPENSION, REVOCATION -- REINSTATEMENT. (1) 49 Upon suspension, revocation, or refusal to continue any license, the director 50 shall notify the licensee as provided in section 41-212(3), Idaho Code, and, 17 1 in the case of a producer who holds appointments from insurers, shall give 2 like notice to the insurers represented. 3 (2) Suspension, revocation, or refusal of any one (1) license held by the 4 licensee under title 41, Idaho Code, shall automatically suspend, revoke or 5 refuse continuation of all other licenses held by the licensee under title 41, 6 Idaho Code. 7 (3) The director shall not issue a license under title 41, Idaho Code, to 8 or as to any person whose license has been revoked or continuance refused 9 until after the expiration of one (1) year from the date of such revocation or 10 refusal or, if judicial review of such revocation or refusal is sought, within 11 one (1) year from the date of a final court order or decree affirming the 12 revocation or refusal. In the event the former licensee again files an appli- 13 cation for a license under title 41, Idaho Code, the director may require the 14 applicant to show good cause why the prior revocation or refusal to continue 15 his license shall not be deemed a bar to the issuance of a new license. 16 41-1027. RETURN OF LICENSE. (1) All licenses, although issued and deliv- 17 ered as to the licensee producer, adjuster or surplus lines broker, shall at 18 all times be the property of the state of Idaho. Upon any expiration, termina- 19 tion, suspension or revocation of the license, the licensee or other person 20 having possession or custody of the license shall deliver it to the director 21 either by personal delivery or by mail. 22 (2) In the case of any license that is lost, stolen or destroyed while in 23 the possession of a licensee or other person, the director may, in lieu of the 24 return of the license, accept the affidavits of the licensee or other person 25 responsible for or involved in the safekeeping of such license concerning the 26 facts of the loss, theft or destruction. 27 41-1028. INACTIVE STATUS. (1) Any individual producer who does not want 28 to actively continue in the business of insurance may apply for inactive sta- 29 tus of his license on forms prescribed by the director. The director, in his 30 discretion, may grant or deny the application for inactive status and shall 31 notify the licensee of this decision in writing. Inactive status of a license, 32 once granted, shall apply to all licenses held by the licensee and shall con- 33 tinue in force until reactivated pursuant to this section or until the license 34 is suspended or revoked pursuant to this chapter. 35 (2) During the period that a licensee remains on inactive status, the 36 licensee may not transact the business of insurance in this state or engage in 37 any other insurance activity which requires an active license. A licensee on 38 inactive status may, subject to the terms of an insurer's contract with the 39 licensee, continue to receive commissions or other compensation relative to 40 business written by such licensee during active license status. 41 (3) Any individual producer whose license is placed on inactive status 42 shall be exempt from compliance with continuing education requirements. 43 (4) An individual producer whose license is placed on inactive status 44 shall be subject to payment of the applicable continuation fees. 45 (5) An individual producer whose license is on inactive status may apply 46 for reactivation of a license on forms prescribed by the director. The request 47 for reactivation shall include proof of completion of twenty (20) hours of 48 continuing education earned during the twelve (12) months prior to 49 reactivation or proof that the producer has retested and met the examination 50 requirements as to any line or kind of insurance to be transacted under the 51 reactivated license. The director, in his discretion, may grant or deny the 52 application for reactivation. 18 1 41-1029. SEVERABILITY. If any provision of this chapter or its applica- 2 tion to any person or circumstance is held invalid, the invalidity does not 3 affect other provisions or applications of this chapter which can be given 4 effect without the invalid provision or application, and to this end the pro- 5 visions of this chapter are severable. 6 SECTION 4. That Section 41-1108, Idaho Code, be, and the same is hereby 7 amended to read as follows: 8 41-1108. OTHER PROVISIONS APPLICABLE. The following sections of chapter 9 10, title 41, Idaho Code, shall, to the extent so applicable, also apply as to 10 adjuster licenses: 11 (1) 41-10307(51)(misrepresentations, etc. in application -- penalty12 (application for producer license). 13 (2) 41-1008 (producer license). 14 (3) 41-104311 (issuance, refusal of license). 15 (34) 41-104613 (continuation, expiration of license, continuing education 16 statement). 17(4) 41-1076 (change of address).18 (5) 41-107716 (administrative penalty -- suspension, revocation, refusal 19 of license). 20 (6) 41-107833 (procedure following suspension, revocation -- reinstate- 21 ment). 22 (7) 41-107934 (return of license). 23 SECTION 5. That Section 41-1223, Idaho Code, be, and the same is hereby 24 amended to read as follows: 25 41-1223. LICENSING OF SURPLUS LINE BROKERS. (1) Any individual while 26 licensed in this state as aresident general lines agentproducer licensed for 27 property or casualty insurance who has had at least two (2) years' experience 28 as a licensed agent or broker for the lines of insurance for which he is seek- 29 ing to be licensed as a surplus lines broker, and who is deemed by the direc- 30 tor to be competent and trustworthy with respect to the handling of surplus 31 lines, and while maintaining an office at a designated location in this state, 32 may be licensed as a surplus line broker. 33 (2) Application for the license shall be made to the director on forms as 34 designated and furnished by the director. 35 (3) The license and continuation fee shall be asspecified inset forth 36 by rule pursuant to section 41-401, Idaho Code.(fee schedule).37 (4) The license and licensee shall be subject to the applicable provi- 38 sions of chapter 10, title 41, Idaho Code (agents, brokers, solicitors and39consultantsproducers -- licensing).requirements and procedures).40 SECTION 6. That Section 41-1315A, Idaho Code, be, and the same is hereby 41 amended to read as follows: 42 41-1315A. DISCOUNTS TO EMPLOYEES. No provision ofthis codetitle 41, 43 Idaho Code, shall be deemed to prohibit allowance by an insurer, agent, or 44 broker to the insurer's or licensee's bona fide full-time salaried employee of 45 a discount from the premium otherwise payable for insurance on the employee's 46 life or health or those of his dependents, or on the employee's property or 47 risks other than property or risks used or involved in business operations of 48 the employee other than as an employee of the insurer, agent, or broker. The 49 amount of discount shall in no event exceed the amount of agent's commission 19 1 which the employer insurer may otherwise pay, or the amount of commission to 2 be received by the employer agent or broker, with respect to the insurance. 3For the purposes of section 41-1033 (controlled business), Idaho Code, the4insurance as to employees of an agent or broker shall be included within the5controlled business of the licensee upon the basis of the commission which the6licensee was entitled to receive as if the discount had not been allowed.7 SECTION 7. That Section 41-3435, Idaho Code, be, and the same is hereby 8 amended to read as follows: 9 41-3435.AGENTSPRODUCER LICENSING. (1)AgentsProducers or persons rep- 10 resenting a service corporation in the solicitation and negotiation of 11 subscriber's contracts shall qualify for and be licensed asagentsproducers 12 of the service corporation in the same manner and in compliance with the same 13 applicable qualifications, licensing procedures and fees as apply under this 14 code as toagentsproducers of disability insurers;except that: 15 (a) Any such person who holds a valid license asan agenta producer for 16 a disability insurer issued under chapter 10, title 41, Idaho Code, may be 17 appointed as the agent for such service corporation without further exami- 18 nation or other compliance with chapter 10, title 41, Idaho Code; and 19 (b) Nothing in this section shall prevent such person from being licensed 20 as a producer and appointed as an agent for a life insurer or insurers 21 under chapter 10, title 41, Idaho Code, and concurrently being licensed as 22an agenta producer for such a service corporation. 23 (2) Service corporationsshallmay file appointment ofsuchagents or 24 representatives in the same manner as provided in section 41-104718, Idaho 25 Code, with respect toagentsproducers of insurers. 26 (3) The exceptions to license requirements set forth in chapter 10, title 27 41, Idaho Code, shall also apply as to service corporations. 28 SECTION 8. That Section 41-4703, Idaho Code, be, and the same is hereby 29 amended to read as follows: 30 41-4703. DEFINITIONS. As used in this chapter: 31 (1) "Actuarial certification" means a written statement by a member of 32 the American academy of actuaries or other individual acceptable to the direc- 33 tor that a small employer carrier is in compliance with the provisions of sec- 34 tion 41-4706, Idaho Code, based upon the person's examination and including a 35 review of the appropriate records and the actuarial assumptions and methods 36 used by the small employer carrier in establishing premium rates for applica- 37 ble health benefit plans. 38 (2) "Affiliate" or "affiliated" means any entity or person who directly 39 or indirectly through one (1) or more intermediaries, controls or is con- 40 trolled by, or is under common control with, a specified entity or person. 41 (3) "Agent" meansan agenta producer as defined in section 41-102103(9), 42 Idaho Code, or a broker as defined in section 41-1024, Idaho Code. 43 (4) "Base premium rate" means, for each class of business as to a rating 44 period, the lowest premium rate charged or that could have been charged under 45 a rating system for that class of business by the small employer carrier to 46 small employers with similar case characteristics for health benefit plans 47 with the same or similar coverage. 48 (5) "Board" means the board of directors of the small employer reinsur- 49 ance program and the individual high risk reinsurance pool as provided for in 50 section 41-5502, Idaho Code. 51 (6) "Carrier" means any entity that provides health insurance in this 20 1 state. For the purposes of this chapter, carrier includes an insurance com- 2 pany, a hospital or professional service corporation, a fraternal benefit 3 society, a health maintenance organization, any entity providing health 4 insurance coverage or benefits to residents of this state as certificate hold- 5 ers under a group policy issued or delivered outside of this state, and any 6 other entity providing a plan of health insurance or health benefits subject 7 to state insurance regulation. 8 (7) "Case characteristics" means demographic or other objective charac- 9 teristics of a small employer that are considered by the small employer car- 10 rier in the determination of premium rates for the small employer, provided 11 that claim experience, health status and duration of coverage shall not be 12 case characteristics for the purposes of this chapter. 13 (8) "Catastrophic health benefit plan" means a higher limit health bene- 14 fit plan developed pursuant to section 41-4712, Idaho Code. 15 (9) "Class of business" means all or a separate grouping of small employ- 16 ers established pursuant to section 41-4705, Idaho Code. 17 (10) "Control" shall be defined in the same manner as in section 18 41-3801(2), Idaho Code. 19 (11) "Dependent" means a spouse, an unmarried child under the age of nine- 20 teen (19) years, an unmarried child who is a full-time student under the age 21 of twenty-three (23) years and who is financially dependent upon the parent, 22 and an unmarried child of any age who is medically certified as disabled and 23 dependent upon the parent. 24 (12) "Director" means the director of the department of insurance of the 25 state of Idaho. 26 (13) "Eligible employee" means an employee who works on a full-time basis 27 and has a normal work week of thirty (30) or more hours or, by agreement 28 between the employer and the carrier, an employee who works between twenty 29 (20) and thirty (30) hours per week. The term includes a sole proprietor, a 30 partner of a partnership, and an independent contractor, if the sole propri- 31 etor, partner or independent contractor is included as an employee under a 32 health benefit plan of a small employer, but does not include an employee who 33 works on a part-time, temporary, seasonal or substitute basis. The term eligi- 34 ble employee may include public officers and public employees without regard 35 to the number of hours worked when designated by a small employer. 36 (14) "Established geographic service area" means a geographic area, as 37 approved by the director and based on the carrier's certificate of authority 38 to transact insurance in this state, within which the carrier is authorized to 39 provide coverage. 40 (15) "Health benefit plan" means any hospital or medical policy or certif- 41 icate, any subscriber contract provided by a hospital or professional service 42 corporation, or managed care organization subscriber contract. Health benefit 43 plan does not include policies or certificates of insurance for specific dis- 44 ease, hospital confinement indemnity, accident-only, credit, dental, vision, 45 medicare supplement, long-term care, or disability income insurance, student 46 health benefits only coverage issued as a supplement to liability insurance, 47 worker's compensation or similar insurance, automobile medical payment insur- 48 ance or nonrenewable short-term coverage issues for a period of twelve (12) 49 months or less. 50 (16) "Index rate" means, for each class of business as to a rating period 51 for small employers with similar case characteristics, the arithmetic average 52 of the applicable base premium rate and the corresponding highest premium 53 rate. 54 (17) "Late enrollee" means an eligible employee or dependent who requests 55 enrollment in a health benefit plan of a small employer following the initial 21 1 enrollment period during which the individual is entitled to enroll under the 2 terms of the health benefit plan, provided that the initial enrollment period 3 is a period of at least thirty (30) days. However, an eligible employee or 4 dependent shall not be considered a late enrollee if: 5 (a) The individual meets each of the following: 6 (i) The individual was covered under qualifying previous coverage 7 at the time of the initial enrollment; 8 (ii) The individual lost coverage under qualifying previous coverage 9 as a result of termination of employment or eligibility, or the 10 involuntary termination of the qualifying previous coverage; and 11 (iii) The individual requests enrollment within thirty (30) days 12 after termination of the qualifying previous coverage. 13 (b) The individual is employed by an employer which offers multiple 14 health benefit plans and the individual elects a different plan during an 15 open enrollment period. 16 (c) A court has ordered coverage be provided for a spouse or minor or 17 dependent child under a covered employee's health benefit plan and request 18 for enrollment is made within thirty (30) days after issuance of the court 19 order. 20 (d) The individual first becomes eligible. 21 (e) If an individual seeks to enroll a dependent during the first sixty 22 (60) days of eligibility, the coverage of the dependent shall become 23 effective: 24 (i) In the case of marriage, not later than the first day of the 25 first month beginning after the date the completed request for 26 enrollment is received; 27 (ii) In the case of a dependent's birth, as of the date of such 28 birth; or 29 (iii) In the case of a dependent's adoption or placement for adop- 30 tion, the date of such adoption or placement for adoption. 31 (18) "New business premium rate" means, for each class of business as to a 32 rating period, the lowest premium rate charged or offered or which could have 33 been charged or offered by the small employer carrier to small employers with 34 similar case characteristics for newly issued health benefit plans with the 35 same or similar coverage. 36 (19) "Plan of operation" means the plan of operation of the program estab- 37 lished pursuant to section 41-4711, Idaho Code. 38 (20) "Plan year" means the year that is designated as the plan year in the 39 plan document of a group health benefit plan, except that if the plan document 40 does not designate a plan year or if there is no plan document, the year plan 41 is: 42 (a) The deductible/limit year used under the plan; 43 (b) If the plan does not impose deductibles or limits on a yearly basis, 44 then the plan year is the policy year; 45 (c) If the plan does not impose deductibles or limits on a yearly basis 46 or the insurance policy is not renewed on an annual basis, then the plan 47 year is the employer's taxable year; or 48 (d) In any other case, the plan year is the calendar year. 49 (21) "Premium" means all moneys paid by a small employer and eligible 50 employees as a condition of receiving coverage from a small employer carrier, 51 including any fees or other contributions associated with the health benefit 52 plan. 53 (22) "Program" means the Idaho small employer reinsurance program created 54 in section 41-4711, Idaho Code. 55 (23) "Qualifying previous coverage" and "qualifying existing coverage" 22 1 meansbenefits or coverage provided under: 2 (a) Medicare or medicaid, civilian health and medical program for 3 uniformed services (CHAMPUS), the Indian health service program, a state 4 health benefit risk pool or any other similar publicly sponsored program; 5 or 6 (b) Any other group or individual health insurance policy or health bene- 7 fit arrangement whether or not subject to the state insurance laws, 8 including coverage provided by a health maintenance organization, hospital 9 or professional service corporation, or a fraternal benefit society, that 10 provides benefits similar to or exceeding benefits provided under the 11 basic health benefit plan. 12 (24) "Rating period" means the calendar period for which premium rates 13 established by a small employer carrier are assumed to be in effect. 14 (25) "Reinsuring carrier" means a small employer carrier participating in 15 the reinsurance program pursuant to section 41-4711, Idaho Code. 16 (26) "Restricted network provision" means any provision of a health bene- 17 fit plan that conditions the payment of benefits, in whole or in part, on the 18 use of health care providers that have entered into a contractual arrangement 19 with the carrier to provide health care services to covered individuals. 20 (27) "Risk-assuming carrier" means a small employer carrier whose applica- 21 tion is approved by the director pursuant to section 41-4710, Idaho Code. 22 (28) "Small employer" means any person, firm, corporation, partnership or 23 association that is actively engaged in business that,employed an average of 24 at least two (2) but no more than fifty (50) eligible employees on business 25 days during the preceding calendar year and that employs at least two (2) but 26 no more than fifty (50) eligible employees on the first day of the plan year, 27 the majority of whom were and are employed within this state. In determining 28 the number of eligible employees, companies that are affiliated companies, or 29 that are eligible to file a combined tax return for purposes of state taxa- 30 tion, shall be considered one (1) employer. 31 (29) "Small employer basic health benefit plan" means a lower cost health 32 benefit plan developed pursuant to section 41-4712, Idaho Code. 33 (30) "Small employer carrier" means a carrier that offers health benefit 34 plans covering eligible employees of one (1) or more small employers in this 35 state. 36 (31) "Small employer catastrophic health benefit plan" means a higher 37 limit health benefit plan developed pursuant to section 41-4712, Idaho Code. 38 (32) "Small employer standard health benefit plan" means a health benefit 39 plan developed pursuant to section 41-4712, Idaho Code. 40 SECTION 9. That Section 41-4933, Idaho Code, be, and the same is hereby 41 amended to read as follows: 42 41-4933. EXISTING INSURANCE LAWS TO APPLY TO THE TRUST FUND WITH CERTAIN 43 EXCEPTIONS. The trust fund shall comply with all of the applicable provisions 44 of title 41, Idaho Code, with certain exceptions as follows: 45 (1) The creation of the trust fund by act of the legislature shall not be 46 deemed to be an ownership, control or operation of an insurer by a governmen- 47 tal entity, as referred to in section 41-309, Idaho Code, and the surplus 48 funds of the trust fund shall be considered to be dedicated and held in 49 reserve for the purpose of providing funds for the payment of claims arising 50 out of the discharge of petroleum products from tanks covered by a contract of 51 insurance issued to the tank owner or operator by the trust fund as provided 52 for in section 41-4905, Idaho Code. The absolute control of the trust fund 53 shall be vested in the manager of the state insurance fund as trustee. 23 1 (2) The provisions of this chapter shall be construed to be contained in 2 the document of organization and bylaws of the trust fund for purposes of sec- 3 tions 41-319, 41-320 and 41-322, Idaho Code, and the director shall issue a 4 certificate of registration to and in the name of the trust fund upon his 5 finding that it has met all other appropriate provisions of the Idaho Code, 6 including sections 41-313, 41-316 and 41-316A, Idaho Code. 7 (3) Section 41-337, Idaho Code, shall not apply to contracts of insurance 8 issued by the trust fund. 9 (4) Sections 41-10304 and 41-1022, Idaho Code, shall not apply to employ- 10 ees of the state insurance fund or the trust fund. 11 (5) Section 41-1103, Idaho Code, shall not apply to employees of the 12 state insurance fund or the trust fund, provided the employees restrict their 13 claims adjusting and investigation operations only to those contracts issued 14 by the trust fund. 15 (6) Except as otherwise provided in this chapter, chapter 28, title 41, 16 Idaho Code, and chapter 14, title 30, Idaho Code, shall not apply to the trust 17 fund nor shall this trust fund be construed to be a domestic mutual insurer, 18 nor a reciprocal insurer, nor any other type of insurer currently regulated by 19 title 41, Idaho Code, and the only organizational requirements of this trust 20 fund shall be those enumerated in this chapter. 21 SECTION 10. That Section 41-5203, Idaho Code, be, and the same is hereby 22 amended to read as follows: 23 41-5203. DEFINITIONS. As used in this chapter: 24 (1) "Actuarial certification" means a written statement by a member of 25 the American academy of actuaries or other individual acceptable to the direc- 26 tor that an individual carrier is in compliance with the provisions of section 27 41-5206, Idaho Code, based upon the person's examination and including a 28 review of the appropriate records and the actuarial assumptions and methods 29 used by the individual carrier in establishing premium rates for applicable 30 health benefit plans. 31 (2) "Affiliate" or "affiliated" means any entity or person who directly 32 or indirectly through one (1) or more intermediaries, controls or is con- 33 trolled by, or is under common control with, a specified entity or person. 34 (3) "Agent" meansan agenta producer as defined in section 41-102135 03(9), Idaho Code, or a broker as defined in section 41-1024, Idaho Code. 36 (4) "Base premium rate" means, as to a rating period, the lowest premium 37 rate charged or that could have been charged under a rating system by the 38 individual carrier to individuals with similar case characteristics for health 39 benefit plans with the same or similar coverage. 40 (5) "Carrier" means any entity that provides health insurance in this 41 state. For purposes of this chapter, carrier includes an insurance company, a 42 hospital or professional service corporation, a fraternal benefit society, a 43 health maintenance organization, any entity providing health insurance cover- 44 age or benefits to residents of this state as certificate holders under a 45 group policy issued or delivered outside of this state, and any other entity 46 providing a plan of health insurance or health benefits subject to state 47 insurance regulation. 48 (6) "Case characteristics" means demographic or other objective charac- 49 teristics of an individual that are considered by the individual carrier in 50 the determination of premium rates for the individual, provided that claim 51 experience, health status and duration of coverage shall not be case charac- 52 teristics for the purposes of this chapter. 53 (7) "Control" shall be defined in the same manner as in section 24 1 41-3801(2), Idaho Code. 2 (8) "Dependent" means a spouse, an unmarried child under the age of nine- 3 teen (19) years, an unmarried child who is a full-time student under the age 4 of twenty-three (23) years and who is financially dependent upon the parent, 5 and an unmarried child of any age who is medically certified as disabled and 6 dependent upon the parent. 7 (9) "Director" means the director of the department of insurance of the 8 state of Idaho. 9 (10) "Eligible individual" means an Idaho resident individual or dependent 10 of an Idaho resident who is under the age of sixty-five (65) years, is not 11 eligible for coverage under a group health plan, part A or part B of title 12 XVIII of the social security act (medicare), or a state plan under title XIX 13 (medicaid) or any successor program, and who does not have other health insur- 14 ance coverage. An "eligible individual" can be the dependent of an eligible 15 employee, which eligible employee is receiving health insurance benefits sub- 16 ject to the regulation of title 41, Idaho Code. 17 (11) "Established geographic service area" means a geographic area, as 18 approved by the director and based on the carrier's certificate of authority 19 to transact insurance in this state, within which the carrier is authorized to 20 provide coverage. 21 (12) "Health benefit plan" means any hospital or medical policy or certif- 22 icate, any subscriber contract provided by a hospital or professional service 23 corporation, or health maintenance organization subscriber contract. Health 24 benefit plan does not include policies or certificates of insurance for spe- 25 cific disease, hospital confinement indemnity, accident-only, credit, dental, 26 vision, medicare supplement, long-term care, or disability income insurance, 27 student health benefits only, coverage issued as a supplement to liability 28 insurance, worker's compensation or similar insurance, automobile medical pay- 29 ment insurance, or nonrenewable short-term coverage issued for a period of 30 twelve (12) months or less. 31 (13) "Index rate" means, as to a rating period for individuals with simi- 32 lar case characteristics, the arithmetic average of the applicable base pre- 33 mium rate and the corresponding highest premium rate. 34 (14) "Individual basic health benefit plan" means a lower cost health ben- 35 efit plan developed pursuant to chapter 55, title 41, Idaho Code. 36 (15) "Individual catastrophic A health benefit plan" means a higher limit 37 health benefit plan developed pursuant to chapter 55, title 41, Idaho Code. 38 (16) "Individual catastrophic B health benefit plan" means a health bene- 39 fit plan with limits higher than an individual catastrophic A health benefit 40 plan developed pursuant to chapter 55, title 41, Idaho Code. 41 (17) "Individual standard health benefit plan" means a health benefit plan 42 developed pursuant to chapter 55, title 41, Idaho Code. 43 (18) "New business premium rate" means, as to a rating period, the lowest 44 premium rate charged or offered or which could have been charged or offered by 45 the individual carrier to individuals with similar case characteristics for 46 newly issued health benefit plans with the same or similar coverage. 47 (19) "Premium" means all moneys paid by an individual and eligible depend- 48 ents as a condition of receiving coverage from a carrier, including any fees 49 or other contributions associated with the health benefit plan. 50 (20) "Qualifying previous coverage" and "qualifying existing coverage" 51 meansbenefits or coverage provided under: 52 (a) Medicare or medicaid, civilian health and medical program for 53 uniformed services (CHAMPUS), the Indian health service program, a state 54 health benefit risk pool, or any other similar publicly sponsored program; 55 or 25 1 (b) Any group or individual health insurance policy or health benefit 2 arrangement whether or not subject to the state insurance laws, including 3 coverage provided by a managed care organization, hospital or professional 4 service corporation, or a fraternal benefit society, that provides bene- 5 fits similar to or exceeding benefits provided under the basic health ben- 6 efit plan. 7 (21) "Rating period" means the calendar period for which premium rates 8 established by a carrier are assumed to be in effect. 9 (22) "Reinsuring carrier" means a carrier participating in the Idaho indi- 10 vidual high risk reinsurance pool established in chapter 55, title 41, Idaho 11 Code. 12 (23) "Restricted network provision" means any provision of a health bene- 13 fit plan that conditions the payment of benefits, in whole or in part, on the 14 use of health care providers that have entered into a contractual arrangement 15 with the carrier to provide health care services to covered individuals. 16 (24) "Risk-assuming carrier" means a carrier whose application is approved 17 by the director pursuant to section 41-5210, Idaho Code. 18 (25) "Individual carrier" means a carrier that offers health benefit plans 19 covering eligible individuals and their dependents. 20 SECTION 11. That Section 41-5501, Idaho Code, be, and the same is hereby 21 amended to read as follows: 22 41-5501. DEFINITIONS. As used in this chapter: 23 (1) "Agent" meansan agenta producer as defined in section 41-102103(9), 24 Idaho Code, or a broker as defined in section 41-1024, Idaho Code. 25 (2) "Board" means the board of directors of the Idaho high risk individ- 26 ual reinsurance pool established in this chapter and the Idaho small employer 27 reinsurance program established in section 41-4711, Idaho Code. 28 (3) "Carrier" means any entity that provides health insurance in this 29 state. For purposes of this chapter, carrier includes an insurance company, 30 any other entity providing reinsurance including excess or stop loss coverage, 31 a hospital or professional service corporation, a fraternal benefit society, a 32 managed care organization, any entity providing health insurance coverage or 33 benefits to residents of this state as certificate holders under a group pol- 34 icy issued or delivered outside of this state, and any other entity providing 35 a plan of health insurance or health benefits subject to state insurance regu- 36 lation. 37 (4) "Dependent" means a spouse, an unmarried child under the age of nine- 38 teen (19) years, an unmarried child who is a full-time student under the age 39 of twenty-three (23) years and who is financially dependent upon the parent, 40 and an unmarried child of any age who is medically certified as disabled and 41 dependent upon the parent. 42 (5) "Director" means the director of the department of insurance of the 43 state of Idaho. 44 (6) "Eligible individual" means an Idaho resident individual or dependent 45 of an Idaho resident who is under the age of sixty-five (65) years, is not 46 eligible for coverage under a group health plan, part A or part B of title 47 XVIII of the social security act (medicare), or a state plan under title XIX 48 (medicaid) or any successor program, and who does not have other health insur- 49 ance coverage. Coverage under a basic, standard, catastrophic A or cata- 50 strophic B health benefit plan shall not be available to any individual who is 51 covered under other health insurance coverage. For purposes of this chapter, 52 to be eligible, an individual must also meet the requirements of section 53 41-5510, Idaho Code. 26 1 (7) "Health benefit plan" means any hospital or medical policy or certif- 2 icate, any subscriber contract provided by a hospital or professional service 3 corporation, or health maintenance organization subscriber contract. Health 4 benefit plan does not include policies or certificates of insurance for spe- 5 cific disease, hospital confinement indemnity, accident-only, credit, dental, 6 vision, medicare supplement, long-term care, or disability income insurance, 7 student health benefits only, coverage issued as a supplement to liability 8 insurance, worker's compensation or similar insurance, automobile medical pay- 9 ment insurance, or nonrenewable short-term coverage issued for a period of 10 twelve (12) months or less. 11 (8) "Individual basic health benefit plan" means a lower cost health ben- 12 efit plan developed pursuant to section 41-5511, Idaho Code. 13 (9) "Individual carrier" means a carrier that offers health benefit plans 14 covering eligible individuals and their dependents. 15 (10) "Individual catastrophic A health benefit plan" means a higher limit 16 health benefit plan developed pursuant to section 41-5511, Idaho Code. 17 (11) "Individual catastrophic B health benefit plan" means a health bene- 18 fit plan offering limits higher than a catastrophic A health benefit plan 19 developed pursuant to section 41-5511, Idaho Code. 20 (12) "Individual standard health benefit plan" means a health benefit plan 21 developed pursuant to section 41-5511, Idaho Code. 22 (13) "Plan" or "pool plan" means the individual basic, standard, cata- 23 strophic A or catastrophic B plan established pursuant to section 41-5511, 24 Idaho Code. 25 (14) "Plan of operation" means the plan of operation of the individual 26 high risk reinsurance pool established pursuant to this chapter. 27 (15) "Pool" means the Idaho high risk reinsurance pool. 28 (16) "Premium" means all moneys paid by an individual and eligible depend- 29 ents as a condition of receiving coverage from a carrier, including any fees 30 or other contributions associated with the health benefit plan. 31 (17) "Qualifying previous coverage" and "qualifying existing coverage" 32 meansbenefits or coverage provided under: 33 (a) Medicare or medicaid, civilian health and medical program for 34 uniformed services (CHAMPUS), the Indian health service program, a state 35 health benefit risk pool, or any other similar publicly sponsored program; 36 or 37 (b) Any group or individual health insurance policy or health benefit 38 arrangement whether or not subject to the state insurance laws, including 39 coverage provided by a managed care organization, hospital or professional 40 service corporation, or a fraternal benefit society, that provides bene- 41 fits similar to or exceeding benefits provided under the basic health ben- 42 efit plan. 43 (18) "Reinsurance premium" means the premium set by the board pursuant to 44 section 41-5506, Idaho Code, to be paid by a reinsuring carrier for plans 45 issued under the pool. 46 (19) "Reinsuring carrier" means a carrier participating in the individual 47 high risk reinsurance pool established by this chapter. 48 (20) "Restricted network provision" means any provision of a health bene- 49 fit plan that conditions the payment of benefits, in whole or in part, on the 50 use of health care providers that have entered into a contractual arrangement 51 with the carrier to provide health care services to covered individuals.
STATEMENT OF PURPOSE
RS 10560C1
This is a total rewrite of the insurance agent and broker licensing
statute. Agents and brokers will be known as producers under the
new law, and consultants will be deleted as a licensee category.
The repeal of former Chapter 10, Title 41, Idaho Code, and rewrite
of this chapter are intended to simplify and reorganize the
statutory language, to improve efficiency, to establish uniform
definitions and licensing requirements across state lines, to
promote increased use of technology thereby reducing the expense
associated issuing and renewing licenses, and to effectuate
producer licensing reciprocity and conformity with the requirements
of the federal Gramm-Leach-Bliley Act enacted November 12, 1999.
FISCAL IMPACT
It is expected that this proposed legislation will have no fiscal
impact on the General Fund.
Contact
Name: John Goedde
Phone: 332-1355
STATEMENT OF PURPOSE/FISCAL NOTE H 35 aa, aaS
AMENDED SOP AMENDED SOP AMENDED SOP