§ 27-4-5-2 — Prohibition of unauthorized insurance business; exceptions; business by mail; venue; validity of contract; right to defend; prerequisites to action

(a) It is a Class A infraction for an insurer to
transact insurance business in this state, as set forth in subsection (b),
without a certificate of authority from the commissioner. However, this
section does not apply to the following:
(1) The lawful transaction of surplus lines insurance.
(2) The lawful transaction of reinsurance by insurers.
(3) Transactions in this state involving a policy lawfully solicited,
written, and delivered outside of this state covering only subjects
of insurance not resident, located, or expressly to be performed in
this state at the time of issuance, and which transactions are
subsequent to the issuance of such policy.
(4) Attorneys acting in the ordinary relation of attorney and client
in the adjustment of claims or losses.
(5) Transactions in this state involving group life and group
sickness and accident or blanket sickness and accident insurance
or group annuities where the master policy of such groups was
lawfully issued and delivered in and pursuant to the laws of a
state in which the insurer was authorized to do an insurance
business, to a group organized for purposes other than the
procurement of insurance, and where the policyholder is
domiciled or otherwise has a bona fide situs.
(6) Transactions in this state relative to a policy issued or to be
issued outside this state involving insurance on vessels, craft or
hulls, cargos, marine builder's risk, marine protection and
indemnity or other risk, including strikes and war risks commonly
insured under ocean or wet marine forms of policy.
(7) Transactions in this state involving life insurance, health
insurance, or annuities provided to religious or charitable
institutions organized and operated without profit to any private
shareholder or individual for the benefit of such institutions and
individuals engaged in the service of such institutions.
(8) Transactions in this state involving contracts of insurance not
readily obtainable in the ordinary insurance market and issued to
one (1) or more industrial insureds. For purposes of this section,
an "industrial insured" means an insured:
(A) who procures the insurance of any risk or risks by use of the
services of a full-time employee acting as an insurance manager
or buyer or the services of a regularly retained and continuously
qualified insurance consultant;
(B) whose aggregate annual premium for insurance on all risks
totals at least twenty-five thousand dollars ($25,000);
(C) who has at least twenty-five (25) full-time employees;
(D) who, on or before February 1 (for the preceding six (6)
month period ending December 31) and August 1 (for the
preceding six (6) month period ending June 30) of each year,
remits to the department an amount equal to two and one-half
percent (2.5%) of all gross premiums upon all policies and
contracts procured by the insured under this section, plus:
(i) ten percent (10%) of the amount due for the first month
after the date specified in this clause, during which the
amount described in this clause is not remitted in compliance
with this clause; and
(ii) an additional one percent (1%) of the amount due for each
additional month during which the amount due under this
clause is unpaid; and
(E) who files with the department, with the amount remitted
under clause (D), an affidavit specifying all transactions
undertaken and policies and contracts procured during the
preceding calendar year, including the following:
(i) The description and location of the insured property or risk
and the name of the insured.
(ii) The gross premiums charged for the policy or contract.
(iii) The name and home office address of the insurer that
issues the policy or contract and the kind of insurance
affected.
(iv) A statement that the insured, after diligent effort, was
unable to procure from any insurer authorized to transact the
particular kind of insurance business in Indiana the full
amount of insurance coverage required to protect the insured.
(9) Transactions in Indiana involving the rendering of any service
by any ambulance service provider and all fees, costs, and
membership payments charged for the service. To qualify under
this subdivision, the ambulance service provider:
(A) must have its ambulance service program approved by an
ordinance of the legislative body of the county or city in which
it operates; and
(B) may not offer any membership program that includes
benefits exceeding five (5) years in duration.
(b) Any of the following acts in this state effected by mail or
otherwise by or on behalf of an unauthorized insurer constitutes the
transaction of an insurance business in this state. The venue of an act
committed by mail is at the point where the matter transmitted by mail
is delivered and takes effect. Unless otherwise indicated, the term
"insurer" as used in this section includes all persons engaged as
principals in the business of insurance and also includes interinsurance
exchanges and mutual benefit societies.
(1) The making of or proposing to make, as an insurer, an
insurance contract.
(2) The making of or proposing to make, as guarantor or surety,
any contract of guaranty or suretyship as a vocation and not
merely incidental to any other legitimate business or activity of
the guarantor or surety.
(3) The taking or receiving of any application for insurance.
(4) The receiving or collection of any premium, commission,
membership fees, assessments, dues, or other consideration for
any insurance or any part thereof.
(5) The issuance or delivery of contracts of insurance to residents
of this state or to persons authorized to do business in this state.
(6) Acting as an agent for or otherwise representing or aiding on
behalf of another person or insurer in the solicitation, negotiation,
procurement, or effectuation of insurance or renewals thereof or
in the dissemination of information as to coverage or rates, or
forwarding of applications, or delivery of policies or contracts, or
inspection of risks, a fixing of rates or investigation or adjustment
of claims or losses or in the transaction of matters subsequent to
effectuation of the contract and arising out of it, or representing
or assisting a person or an insurer in the transaction of insurance
with respect to subjects of insurance resident, located, or to be
performed in this state. This subdivision does not prohibit
full-time salaried employees of a corporate insured from acting in
the capacity of an insurance manager or buyer in placing
insurance in behalf of the employer.
(c)(1) The failure of an insurer transacting insurance business in this
state to obtain a certificate of authority does not impair the validity of
any act or contract of such insurer and does not prevent such insurer
from defending any action at law or suit in equity in any court of this
state, but no insurer transacting insurance business in this state without
a certificate of authority may maintain an action in any court of this
state to enforce any right, claim, or demand arising out of the
transaction of such business until such insurer obtains a certificate of
authority.
(2) In the event of failure of any such unauthorized insurer to pay
any claim or loss within the provisions of such insurance contract, any
person who assisted or in any manner aided directly or indirectly in the
procurement of such insurance contract is liable to the insured for the
full amount of the claim or loss in the manner provided by the
insurance contract.
Formerly: Acts 1969, c.194, s.2. As amended by Acts 1978,
P.L.2, SEC.2720; P.L.161-1988, SEC.1; P.L.130-1994, SEC.39;
P.L.116-1994, SEC.51; P.L.252-1995, SEC.2; P.L.11-2011, SEC.25;
P.L.46-2019, SEC.1.