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H0006........................................................by MR. SPEAKER
Requested by Department of Insurance
INSURANCE AGENTS - LICENSURE - Amends existing law relating to insurance
agent or broker licenses issued by the Department of Insurance to authorize
licensure of Canadians; to strike specific requirements of the application
for license; to increase the fee for service of a summons; and to further
clarify the application of certain requirements.
01/11 House intro - 1st rdg - to printing
01/11 Rpt prt - to Bus
01/29 Rpt out - rec d/p - to 2nd rdg
02/01 2nd rdg - to 3rd rdg
02/02 3rd rdg - PASSED - 65-0-4
AYES -- Alltus, Barraclough, Barrett, Bell, Boe, Bruneel, Callister,
Campbell, Chase, Clark, Crow, Cuddy, Deal, Denney, Ellsworth,
Field(13), Field(20), Gagner, Geddes, Hadley, Hammond, Hansen(23),
Hansen(29), Henbest, Hornbeck, Jaquet, Jones, Judd, Kellogg, Kempton,
Kendell, Kjellander, Kunz, Lake, Limbaugh, Loertscher, Mader, Marley,
McKague, Meyer, Montgomery, Mortensen, Moyle, Pischner, Pomeroy,
Reynolds, Ridinger, Ringo, Robison, Sali, Schaefer, Sellman, Smith,
Stevenson, Stoicheff, Stone, Taylor, Tilman, Tippets, Trail, Watson,
Wheeler, Williams, Zimmermann, Mr Speaker
NAYS -- None
Absent and excused -- Black, Gould, Linford, Wood
Dist. 19, Seat A, Vacant
Floor Sponsor - Callister
Title apvd - to Senate
02/03 Senate intro - 1st rdg - to Com/HuRes
03/03 Rpt out - rec d/p - to 2nd rdg
03/04 2nd rdg - to 3rd rdg
03/11 3rd rdg - PASSED - 34-0-1
AYES--Andreason, Boatright, Branch, Bunderson, Burtenshaw, Cameron,
Crow, Danielson, Darrington, Davis, Deide, Dunklin, Frasure, Geddes,
Hawkins, Ingram, Ipsen, Keough, King, Lee, McLaughlin, Noh,
Richardson, Riggs, Risch, Sandy, Schroeder, Sorensen, Stegner,
Stennett, Thorne, Twiggs, Wheeler, Whitworth
NAYS--None
Absent and excused--Parry
Floor Sponsor - Davis
Title apvd - to House
03/12 To enrol
03/15 Rpt enrol - Sp signed
03/16 Pres signed - to Governor
03/18 Governor signed
Session Law Chapter 97
Effective: 07/01/99
H0006|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fifth Legislature First Regular Session - 1999IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 6 BY MR. SPEAKER Requested by: Department of Insurance 1 AN ACT 2 RELATING TO THE INSURANCE CODE; AMENDING SECTION 41-1034, IDAHO CODE, TO PRO- 3 VIDE THAT CANADIAN RESIDENTS MAY QUALIFY FOR LICENSURE; AMENDING SECTION 4 41-1037, IDAHO CODE, TO STRIKE SPECIFIC REQUIREMENTS OF THE APPLICATION 5 FOR LICENSE AND TO MAKE A TECHNICAL CORRECTION; AMENDING SECTION 41-1066, 6 IDAHO CODE, TO AUTHORIZE LICENSURE OF PERSONS WHO ARE LICENSED IN AND CON- 7 DUCT BUSINESS PRINCIPALLY IN A STATE OTHER THAN THEIR STATE OF DOMICILE; 8 AMENDING SECTION 41-1067, IDAHO CODE, TO AUTHORIZE AN INCREASE IN THE FEE 9 FOR SERVICE; AMENDING SECTION 41-1068, IDAHO CODE, TO STRIKE AN EXEMPTION 10 FROM APPLICATION TO LIFE OR DISABILITY INSURANCE; AND AMENDING SECTION 11 41-1108, IDAHO CODE, TO CORRECT A CITATION. 12 Be It Enacted by the Legislature of the State of Idaho: 13 SECTION 1. That Section 41-1034, Idaho Code, be, and the same is hereby 14 amended to read as follows: 15 41-1034. QUALIFICATIONS -- AGENTS OR BROKERS. For the protection of the 16 people of this state, the director shall not issue, continue, or permit to 17 exist any agent or broker license except in compliance with this chapter, or 18 as to any individual not qualified therefor as follows: 19 (1) Must be a natural person eighteen (18) years or more of age; 20 (2) Must be a citizen of the United States of America or of Canada 21 , or have applied to the United States department of immigration for 22 permanent residency and declared to the director of the department of insur- 23 ance intention to apply for citizenship. If citizenship is not granted within 24 six (6) years of such declaration, any license issued to such person shall be 25 revoked automatically; 26 (3) Must be currently domiciled in and be a bona fide resident of this 27 state. This provision does not apply as to any person licensed as a nonresi- 28 dent agent or broker under section 41-1066, Idaho Code; 29 (4) Must be trustworthy, be of good character and reputation as to 30 morals, integrity, financial responsibility, and must not have been convicted 31 of or pled guilty to a felony or a misdemeanor. The misdemeanor must have been 32 one which evidences (a) bad moral character, dishonesty, or a lack of integ- 33 rity and financial responsibility, or (b) an unfitness and inability to pro- 34 vide acceptable service to the consuming public. The director may at his dis- 35 cretion waive the requirement that the individual must not have been con- 36 victed of a felony or a misdemeanor, if the director finds that the individual 37 has been rehabilitated and is otherwise qualified to hold the license; 38 (5) If for a broker's license, must have had experience either as an 39 agent, consultant, service representative, adjuster, managing general agent, 40 or broker, or other special experience, education or training, all of suffi- 41 cient content and duration as deemed by the director to be reasonably neces- 42 sary for competence in fulfilling the responsibilities of a broker, and must 43 have filed the bond required by section 41-1054, Idaho Code; 2 1 (6) Must be competent as to the business to be transacted under the 2 license applied for, and pass to the director's satisfaction any written exam- 3 ination required under this chapter to test such competency; 4 (7) Must not be a service representative, as defined in section 5 41-1032(3), Idaho Code; 6 (8) Must intend in good faith to engage actively in the insurance busi- 7 ness under the license with respect to the general public, and not use or 8 intend to use the license principally for the purpose of writing controlled 9 business as defined in section 41-1033, Idaho Code. 10 SECTION 2. That Section 41-1037, Idaho Code, be, and the same is hereby 11 amended to read as follows: 12 41-1037. APPLICATION FOR LICENSE. (1) Written application for an agent, 13 broker or consultant license shall be made to the director by the applicant on 14 forms prepared and furnished by the director, accompanied by the applicable 15 license application and fees shown in section 41-401, Idaho Code (fee sched- 16 ule). If the same are not already on file with the director in connection with 17 a previous application, the application shall also be accompanied by the 18 applicant's fingerprints on a standard police form as used for fingerprint 19 purposes, and by a recent photograph of the applicant. The appli- 20 cation shall be signedand duly sworn toby the applicant . 21before a notary public or other person authorized by law to take22acknowledgements of deeds.23 (2)The application form shall require the applicant to state:24(a) His full name;25(b) His residences, occupations, and places of business during the five26(5) years next preceding date of the application;27(c) If for an agent, broker, or consultant license, the kind or kinds of28insurance to be covered by the license;29(d) Whether he has ever held a license to transact or advise with respect30to any kind of insurance in any state; and whether any such license has31been refused, suspended or revoked or any administrative disciplinary32action has been taken with respect to such license;33(e) What insurance experience, if any, he has had;34(f) What instruction in the kinds of insurance or contracts proposed to35be solicited or concerned with, and in the insurance laws of this state,36he has had or expects to have;37(g) Whether any insurer or general agent or consultant client claims that38he is indebted under any agency contract or otherwise and, if so, the name39of the claimant, the nature of the claim and the applicant's defense40thereto;41(h) Whether he has had a general agency contract or agency contract can-42celled and if so when, by what insurer or general agent and the reasons43therefor;44(i) Whether he will devote all or part of his efforts to acting as such45agent, broker or consultant, and if part only, how much time he will46devote to such work, and in what other business or businesses he expects47to be engaged or employed;48(j) Whether, if applicant is married, the applicant's spouse has ever49applied for or held a license to transact any kind of insurance in any50state and whether such license has been refused, suspended, or revoked;51and52(k) Such other information as the director may reasonably require.53(3)If for an agent license, the application shall be accompanied 3 1 by written appointment by an authorized insurer of the applicant as agent for 2 a kind or kinds of insurance to be transacted under the license, subject to 3 issuance of the license. 4 (43 ) If the applicant is a firm or corporation, 5 as provided in section 41-1036, Idaho Code, the application shall show, in 6 addition, the names and residence addresses of all members, officers and 7 directors, and shall designate the name and residence address of each indi- 8 vidual who is to exercise the license powers; and each such individual shall 9 furnish information with respect to himself as though for an individual 10 license. 11 (54 ) If for agent license, the application 12 shall also be accompanied by the certificate (on a form designated and fur- 13 nished by the director) of an officer or representative of the insurer pro- 14 posed to be represented or of the applicant's employer (in the case of appli- 15 cants for agent license) that the insurer, agent or broker has investigated, 16 or caused an investigation to be made of, the character and business record of 17 the applicant and the uses to be made of the license, if granted, and the 18 findings of such investigation as to applicant's trustworthiness, integrity, 19 financial responsibility, competence and other qualifications for the license, 20 and whether the applicant will use the license principally for the purpose of 21 writing controlled business, as referred to in section 41-1033, Idaho Code. In 22 lieu of, or in addition to, the certificate of the insurer, agent, or broker 23 provided for in this subsection, the director may, in his discretion, cause an 24 investigation to be made of the applicant by an independent established 25 reporting agency; and in such event the applicant, insurer, agent, or broker, 26 as the case may be, shall pay to the director in advance an amount equal to 27 the cost of such investigation as determined by the director. 28 (65 ) No applicant for any license under this 29 chapter shallwilfullywillfully withhold or misrep- 30 resent any fact or information called for in the application form or otherwise 31 by the director. Violation of this provision shall be a misdemeanor. 32 SECTION 3. That Section 41-1066, Idaho Code, be, and the same is hereby 33 amended to read as follows: 34 41-1066. NONRESIDENT AGENTS, BROKERS -- SPECIAL CONDITIONS. In addition 35 to the qualifications and requirements therefor referred to in section 36 41-1065, Idaho Code, the issuance of such a nonresident agent or broker 37 license is subject to the following conditions: 38 (1) The applicant and licensee must at all times be qualified for and 39 hold in the state of his domicile or principal place of business 40 the license of such state as a nresidentinsurance 41 agent or broker covering all the kinds of insurance covered or to be covered 42 under the Idaho nonresident license. In the case of nonresident firms and cor- 43 porations, each individual member, officer or employee to be named in or reg- 44 istered with the director as to the Idaho license to exercise the powers 45 thereof must either hold such a license in the state of his domi- 46 cilestateor principal place of business or have 47 qualified as for an individual license and be named in or registered as to the 48 license issued to the firm or corporation in the state of domi- 49 cilestateor principal place of business . 50 (2) The director may, in his discretion, prior to issuance of such a 51 license, procure a report of investigation of the applicant made by an estab- 52 lished commercial investigation and reporting agency. The cost of such inves- 53 tigation and report shall be paid by the applicant to the director upon noti- 4 1 fication by the director of the amount thereof. The director may, in his dis- 2 cretion, require the applicant to deposit with him in advance an amount esti- 3 mated as being sufficient to cover the cost of any such investigation and 4 report, and the director shall promptly refund to the applicant any portion of 5 such a deposit which is not actually expended for the purpose for which depos- 6 ited. All such reports shall be deemed to be privileged communications and 7 shall not be admissible in evidence in any action or proceeding. All such 8 reports shall be the property of the state of Idaho. 9 (3) The licensee shall not enter the state of Idaho and solicit insurance 10 business, inspect risks, or otherwise conduct business in this state unless 11 similar privileges in the state of the licensee's domicile or principal 12 place of business are granted to residents of this state holding simi- 13 lar nonresident licenses issued by such other state. 14 (4) The licensee shall be subject to all such taxes, licenses, fees, 15 fines, penalties, deposit and bond requirements, and other material obliga- 16 tions, prohibitions or restrictions, including countersignature and commission 17 requirements, as are imposed by the state of the licensee's domicile or 18 principal place of business upon resident Idaho agents or brokers who 19 transact or seek to transact insurance in the state of the licensee's domicile 20 or principal place of business which are in excess of or in addi- 21 tion to the taxes, licenses, fees, fines, penalties, deposit and bond require- 22 ments, or other obligations, prohibitions, or restriction imposed upon the 23 licensee by or under the laws of this state. 24 (5) The licensee shall transact insurance in this state or with respect 25 to subjects of insurance resident, located, or to be performed in this state 26 only through insurers duly authorized to transact such insurance in this 27 state. 28 (6) The license is not transferable. 29 SECTION 4. That Section 41-1067, Idaho Code, be, and the same is hereby 30 amended to read as follows: 31 41-1067. NONRESIDENT AGENTS, BROKERS -- SERVICE OF PROCESS. (1) Each 32 licensed nonresident agent or broker shall appoint the director as his attor- 33 ney to receive service of legal process issued against the agent or broker in 34 this state upon causes of action arising within this state out of transactions 35 under the license. Service upon the director as attorney shall constitute 36 effective legal service upon the agent or broker. 37 (2) The appointment shall be irrevocable for as long as there could be 38 any cause of action against the licensee arising out of his insurance transac- 39 tions in or with respect to this state. 40 (3) Duplicate copies of such legal process against the licensee shall be 41 served upon the director by a person competent to serve a summons. At the time 42 of service the plaintiff shall pay the directorfivean 43 appropriate fee not in excess of thirty dollars ($544 30 .00),taxable as costs in the actionwhich fee 45 shall be determined by rule . 46 (4) Upon receiving such service, the director shall forthwith send one 47 (1) of the copies of the process, by registered or certified mail with return 48 receipt requested, to the defendant licensee at his address last of record 49 with the director. 50 (5) The director shall keep a record of the day and hour of service upon 51 him of all such legal process. 52 SECTION 5. That Section 41-1068, Idaho Code, be, and the same is hereby 5 1 amended to read as follows: 2 41-1068. INSURERS MUST ACCEPT BUSINESS THROUGH LICENSED AGENTS, BROKERS 3 ONLY. (1) No authorized insurer shall make, write, place or cause to be made, 4 written or placed in this state any policy, duplicate policy, or insurance 5 contract of any kind, covering a subject of insurance resident, located, or to 6 be performed in this state through any nonresident person who is not then 7 licensed as a nonresident agent or broker under this chapter. 8 (2) The director may suspend or revoke the certificate of authority of 9 any insurer violating this section. 10(3) This section does not apply to life or disability insurances.1112 SECTION 6. That Section 41-1108, Idaho Code, be, and the same is hereby 13 amended to read as follows: 14 41-1108. OTHER PROVISIONS APPLICABLE. The following sections of chapter 15 10, title 41, Idaho Code, shall, to the extent so applicable, also apply as to 16 adjuster licenses: 17 (1) 41-1037(75 ) (misrepresentations, etc. in 18 application--penalty). 19 (2) 41-1043 (issuance, refusal of license). 20 (3) 41-1046 (continuation, expiration of license). 21 (4) 41-1076 (change of address). 22 (5) 41-1077 (suspension, revocation, refusal of license). 23 (6) 41-1078 (procedure following suspension, revocation--reinstatement). 24 (7) 41-1079 (return of license).
STATEMENT OF PURPOSE
RS08352C1
To amend Idaho Code Section 41-1034, to make it consistent with
Section 41-1025 by clarifying that Canadian residents may qualify
for an Idaho nonresident agent or broker license; to amend Idaho
Code Section 41-1037(1), to eliminate the requirement that
applicants for an insurance agent, broker or consultant license
include with the application a recent photograph of the applicant,
and to delete the application information requirements of Section
41-1037(2); to amend Idaho Code Section 41-1066 to allow the
Department to issue nonresident licenses to persons who are
licensed in and principally do business in a state other than their
state of domicile; to amend Idaho Code Section 41-1067 to make the
fee for service of nonresident agents consistent with the fee for
service of nonresident insurance companies as set forth at Idaho
Code Section 41-334; and to amend Idaho Code Section 41-1068 to
clarify that the requirement that insurers transacting insurance in
Idaho through nonresident agents use only agents who are licensed
by the Department also applies to life or disability insurance.
FISCAL IMPACT
Fiscal impact is expected to be minimal.
CONTACT
Name: James Genetti
Agency: Department of Insurance
Phone: 334-4250
Statement of Purpose/Fiscal Impact H