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H0491...........................................................by BUSINESS INSURER - CERTIFICATE OF AUTHORITY - Amends existing law to provide that the director may issue new orders of suspension; and to provide that certificates of authority shall be deemed terminated at the end of the suspension period if not reinstated or if a new order of suspension is not issued. 01/20 House intro - 1st rdg - to printing 01/21 Rpt prt - to Bus 02/10 Rpt out - rec d/p - to 2nd rdg 02/11 2nd rdg - to 3rd rdg 02/16 3rd rdg - PASSED - 70-0-0 AYES -- Andersen, Barraclough, Barrett, Bauer, Bayer, Bedke, Bell, Black, Block, Boe, Bolz, Bradford, Campbell, Cannon, Clark, Collins, Crow, Cuddy, Deal, Denney, Douglas, Eberle, Edmunson, Ellsworth, Eskridge, Field(18), Field(23), Gagner, Garrett, Harwood, Henbest, Jaquet, Jones, Kellogg(Nonini), Kulczyk, Lake, Langford, Langhorst, Martinez, McGeachin, McKague, Meyer, Miller, Mitchell, Moyle, Naccarato, Nielsen, Pasley-Stuart, Raybould, Ridinger, Ring, Ringo, Roberts, Robison, Rydalch, Sali, Sayler, Schaefer, Shepherd, Shirley, Skippen, Smith(30), Smith(24), Smylie, Snodgrass, Stevenson, Trail, Wills, Wood, Mr. Speaker NAYS -- None Absent and excused -- None Floor Sponsor - Deal Title apvd - to Senate 02/17 Senate intro - 1st rdg - to Com/HuRes 02/25 Rpt out - rec d/p - to 2nd rdg 02/26 2nd rdg - to 3rd rdg 03/10 3rd rdg - PASSED - 35-0-0 AYES -- Andreason(Andreason), Bailey, Brandt, Bunderson, Burkett, Burtenshaw, Calabretta, Cameron, Compton, Darrington, Davis, Gannon, Geddes, Goedde, Hill, Ingram, Kennedy, Keough, Little, Lodge, Malepeai, Marley, McKenzie, McWilliams, Noble, Noh, Pearce, Richardson, Schroeder, Sorensen, Stegner, Stennett, Sweet, Werk, Williams NAYS -- None Absent and excused -- None Floor Sponsor - Werk Title apvd - to House 03/11 To enrol 03/12 Rpt enrol - Sp signed 03/15 Pres signed 03/16 To Governor 03/19 Governor signed Session Law Chapter 88 Effective: 07/01/04
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-seventh Legislature Second Regular Session - 2004IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 491 BY BUSINESS COMMITTEE 1 AN ACT 2 RELATING TO SUSPENSION OF INSURER CERTIFICATES OF AUTHORITY; AMENDING SECTION 3 41-329, IDAHO CODE, TO PROVIDE THAT THE DIRECTOR MAY ISSUE NEW ORDERS OF 4 SUSPENSION, TO PROVIDE THAT CERTIFICATES OF AUTHORITY SHALL BE DEEMED TER- 5 MINATED AT THE END OF THE SUSPENSION PERIOD IF NOT REINSTATED OR IF A NEW 6 ORDER OF SUSPENSION IS NOT ISSUED AND TO MAKE A TECHNICAL CORRECTION. 7 Be It Enacted by the Legislature of the State of Idaho: 8 SECTION 1. That Section 41-329, Idaho Code, be, and the same is hereby 9 amended to read as follows: 10 41-329. DURATION OF SUSPENSION -- INSURER'S OBLIGATIONS DURING SUSPENSION 11 PERIOD -- REINSTATEMENT. (1) Suspension of an insurer's certificate of author- 12 ity shall be for such period as the director specifies in the order of suspen- 13 sion, but not to exceed one (1) year. During the suspension the director may 14 rescind or shorten the suspension by his further order. 15 (2) During the suspension period the insurer shall not solicit or write 16 any new business in this state, but shall file its annual statement, pay fees, 17 licenses, and taxes as required under this code, and may service its business 18 already in force in this state, as if the certificate of authority had contin- 19 ued in full force. 20 (3) Upon expiration of the suspension period, if within such period the 21 certificate of authority has not terminated, the insurer's certificate of 22 authority shall automatically reinstate unless the director finds that the 23 causes of the suspension have not terminated, or that the insurer is otherwise 24 not in compliance with the requirements of this code, and of which the direc- 25 tor shall give the insurer notice not less than thirty (30) days in advance of 26 the expiration of the suspension period after which time the director may 27 issue a new order of suspension. If notso automaticallyreinstated or if a 28 new order of suspension is not issued, the certificate of authority shall be 29 deemed to have terminated as of the end of the suspension period. 30 (4) Upon reinstatement of the insurer's certificate of authority, the 31 authority of its agents in this state to represent the insurer shall likewise 32 reinstate. The director shall promptly notify the insurer and its agents in 33 this state of record in the department, of such reinstatement. If pursuant to 34 section 41-328(3), Idaho Code, the director has published notice of such sus- 35 pension he shall in like manner publish notice of the reinstatement.
STATEMENT OF PURPOSE RS 13505 Idaho Code Section 41-329 allows the Director of the Department of Insurance to suspend for up to one year the certificate of authority of an insurer that is not in compliance with Idaho's laws. In many cases, the company is unable to correct the problems that led to the suspension within one year and a re-suspension of the company's license to provide the company additional time to come into compliance is preferable to terminating the company's certificate of authority to do business in Idaho. Section 41-329 does not address resuspending a license, and subsection (3) of that section could be interpreted as requiring that a company's certificate of authority automatically terminate if a company subject to a suspension order has not remedied the problems that gave rise to the suspension order at the end of the one-year suspension period. This bill amends the law to provide the Director discretion to issue another order of suspension if the company has not come into compliance within the initial one-year suspension. FISCAL IMPACT There will be no fiscal impact. CONTACT Name: Shad Priest Agency: Department of Insurance Phone: 334-4214 Statement of Purpose/Fiscal Impact H 491