TITLE 41

INSURANCE

CHAPTER 12

UNAUTHORIZED INSURERS AND SURPLUS LINES

41-1213.  Definitions. As used in this chapter and any applicable rules, the following definitions shall apply:

(1)  "Affiliated" means, with respect to an insured, any entity that controls, is controlled by or is under common control with the insured.

(2)  "Affiliated group" means any group of entities that are all affiliated.

(3)  "Broker" means a surplus line broker duly licensed as such under this chapter, including resident surplus line brokers and nonresident surplus line brokers.

(4)  "Control" means:

(a)  An entity directly or indirectly, or acting through one (1) or more other persons, owns or controls another entity or has the power to vote twenty-five percent (25%) or more of any class of voting securities of another entity; or

(b)  An entity controls in any manner the election of a majority of the directors or trustees of another entity.

(5)  (a) "Exempt commercial purchaser" means any person purchasing commercial insurance who, at the time of placement, meets the following requirements:

(i)   The person employs or retains a qualified risk manager to negotiate insurance coverage.

(ii)  The person has paid aggregate nationwide commercial property and casualty insurance premiums in excess of one hundred thousand dollars ($100,000) in the immediately preceding twelve (12) months.

(iii) The person meets at least one (1) of the following criteria:

1.  The person possesses a net worth in excess of twenty million dollars ($20,000,000) as such amount is adjusted pursuant to the provisions of paragraph (b) of this subsection.

2.  The person generates annual revenues in excess of fifty million dollars ($50,000,000) as such amount is adjusted pursuant to the provisions of paragraph (b) of this subsection.

3.  The person employs more than five hundred (500) full-time or full-time equivalent employees per individual insured or is a member of an affiliated group employing more than one thousand (1,000) employees in the aggregate.

4.  The person is a nonprofit organization or public entity generating annual budgeted expenditures of at least thirty million dollars ($30,000,000) as such amount is adjusted pursuant to the provisions of paragraph (b) of this subsection.

5.  The person is a municipality with a population in excess of fifty thousand (50,000) persons.

(b)  The amounts provided in subparagraph (iii)1., 2. and 4. of paragraph (a) of this subsection must be adjusted to reflect the percentage change for the five (5) year period in the consumer price index for all urban consumers published by the bureau of labor statistics of the United States department of labor.

(c)  For the purposes of this subsection, "commercial insurance" means property and casualty insurance pertaining to a business, profession, occupation, nonprofit organization or public entity.

(6)  "Export" means to place in an unauthorized insurer under this surplus line law insurance covering a subject of insurance resident, located, or to be performed in Idaho.

(7)  (a) "Home state" means:

(i)   The state in which an insured maintains its principal place of business or, in the case of an individual, the individual’s principal residence; or

(ii)  If one hundred percent (100%) of the insured risk is located out of state, the state to which the greatest percentage of the insured’s taxable premium for that insurance contract is allocated.

(b)  If more than one (1) insured from an affiliated group are named insureds on a single nonadmitted insurance contract, then "home state" means the home state, as determined pursuant to the provisions of paragraph (a) of this subsection, of the member of the affiliated group that has the largest percentage of premium attributed to it under such insurance contract.

(c)  For the purposes of this subsection, "principal place of business" means the state where the insured maintains its headquarters and where the insured’s high level officers direct, control and coordinate the business activities of the insured.

(8)  "Qualified risk manager" means, with respect to a policyholder of commercial insurance, a person who meets all of the following requirements:

(a)  The person is an employee of, or a third party consultant retained by, the commercial policyholder;

(b)  The person provides skilled services in loss prevention, loss reduction or risk and insurance coverage analysis, and purchase of insurance; and

(c)  The person:

(i)   Has at least ten (10) years of experience in risk financing, claim administration, loss prevention, risk and insurance coverage analysis or purchasing commercial lines of insurance; or

(ii)  Has a graduate degree from an accredited college or university in risk management, business administration, finance, economics or any other field determined by a state insurance director or other state regulatory official or entity to demonstrate minimum competence in risk management; or

(iii) Has at least seven (7) years of experience in risk financing, claims administration, loss prevention, risk and insurance coverage analysis or purchasing commercial lines of insurance and has one (1) of the designations specified in subparagraph (iv)1. through 5. of this paragraph; or

(iv)  Has a bachelor’s degree or higher education from an accredited college or university in risk management, business administration, finance, economics or any other field determined by a state insurance director or other state regulatory official or entity to demonstrate minimum competency in risk management; and either has three (3) years of experience in risk financing, claims administration, loss prevention, risk and insurance analysis or purchasing commercial lines of insurance, or has one (1) of the following designations:

1.  A designation as a chartered property and casualty underwriter (CPCU) issued by the American institute for CPCU and insurance institute of America;

2.  A designation as an associate in risk management (ARM) issued by the American institute for CPCU and insurance institute of America;

3.  A designation as a certified risk manager (CRM) issued by the national alliance for insurance education and research;

4.  A designation as a RIMS fellow (RF) issued by the global risk management institute; or

5.  Any other designation, certification or license determined by a state insurance director or other state insurance regulatory official or entity to demonstrate minimum competency in risk management.

History:

[41-1213, added 1961, ch. 330, sec. 257, p. 645; am. 2002, ch. 91, sec. 2, p. 228; am. 2011, ch. 183, sec. 2, p. 518.]