§ 23-64-232 — Premium delinquencies - Definitions

Arkansas § 23-64-232

• Jurisdiction: Arkansas
• Title: 23

Text

(a) For purposes of this section: (1) "Account current" or "account rendered" means any system of account reconciliation between two (2) or more insurance producers, surplus lines brokers, or insurance companies that purports to render the status of the account between them in regard to the amount of net premium or return premium due; (2) "Insurance producer" shall have the meaning found in § 23-64-502 and shall also include surplus lines brokers; (3) "Insurer" shall have the meaning found in § 23-60-102 and shall include a surplus lines broker when it is representing the insurer in a transaction with an insurance producer; (4) "Reconciled item" means an item subject to an invoice, account current, or account rendered that is undisputed, liquidated, and not subject to reasonable dispute; and (5) "Surplus lines broker" shall have the meaning found in § 23-65-308 . (b) When the premium due for an insurance policy or endorsement to the policy becomes a reconciled item and the insurance producer fails to deliver to the insurer the premiums due for the insurance policy or endorsement within the time provided by the agreement between the insurance producer and the insurer, or within sixty (60) days if no agreement, the insurer shall demand in writing that within thirty (30) days after the date of the demand, the insurance producer shall: (1) Cure the default; and (2) Provide a sworn affidavit declaring: (A) That the total of its available cash and cash equivalent assets exceeds the total of all premiums that are due all of its customers and any insurers with which it holds an appointment or has a contractual relationship; (B) The insurance producer's license number or other identification issued by the State Insurance Department; and (C) Any other comments that describe the reason for the default or any reason that the default is disputed. (c) The insurer shall provide a copy of the demand and any statements received from the insurance producer pursuant to subsection (b) of this section to the Insurance Commissioner as attachments to the report on which the insurance producer appears, as required by subsection (d) of this section. (d) By the end of each month, the insurer shall furnish a report to the commissioner, on a form approved by the commissioner, the following information with respect to each insurance producer who was mailed a demand pursuant to subsection (b) of this section in the prior month: (1) The name of the agent or agency; (2) The amount of premiums that are in default; (3) The date of the inception of the insurance policy or endorsement; and (4) The date when the transaction became reconciled. (e) Failure of the insurance producer to comply with the reporting requirements of subdivision (b)(2) of this section shall constitute a Class A misdemeanor. (f) This section does not create an affirmative defense to, or a limitation on, prosecutions brought under § 23-64-223 .

Legislative History

Acts 2001, No. 1827, § 1; 2003, No. 1350, §§ 1, 2.