(a)An insurance producer, a broker, an
agency, a premium finance company, an insured, or any other person
responsible for the payment of a premium shall be obligated to pay any
earned but unpaid premium for any policy that is due the insurer for
coverage provided before the declaration of insolvency. However, an
insurance producer, a broker, an agency, a premium finance company,
an insured, or any other person responsible for the payment of a
premium shall not be responsible for any unpaid premium unearned as
of the time of the declaration of insolvency.
(b)In addition to the obligation owed under subsection (a), an
insurance producer, broker, agency, premium finance company, or any
other person, other than the insured, responsible for the payment of a
premium to the insurance company or
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(a) An insurance producer, a broker, an
agency, a premium finance company, an insured, or any other person
responsible for the payment of a premium shall be obligated to pay any
earned but unpaid premium for any policy that is due the insurer for
coverage provided before the declaration of insolvency. However, an
insurance producer, a broker, an agency, a premium finance company,
an insured, or any other person responsible for the payment of a
premium shall not be responsible for any unpaid premium unearned as
of the time of the declaration of insolvency.
(b) In addition to the obligation owed under subsection (a), an
insurance producer, broker, agency, premium finance company, or any
other person, other than the insured, responsible for the payment of a
premium to the insurance company or any holding company shall pay
any unearned premium collected from the insured before the
declaration of insolvency. The commissioner may also recover from
that person any part of an unearned premium that represents a
commission of that person.
(c) Credits or setoffs or both may not be allowed to an insurance
producer, broker, or premium finance company for any amounts
advanced to the insurer by the insurance producer, broker, or premium
finance company on behalf of, but in the absence of a payment by, the
insured.
(d) Upon satisfactory evidence of a violation of this section, the
commissioner may pursue the following courses of action against those
parties licensed by the department of insurance:
(1) Suspend, revoke, or refuse to renew the licenses of the
offending party.
(2) Impose a penalty of not more than one thousand dollars
($1,000) for each and every act in violation of this article by the
party.
These penalties are in addition to and not in lieu of the obligations
owed under subsections (a) and (b).
(e) Before the commissioner may take any action as provided in
subsection (d), the commissioner shall give written notice to the person
accused of violating the law, stating specifically the nature of the
alleged violation, and fixing a time (at least ten (10) days after the
notice is sent) and place when a hearing on the matter is to be held.
After the hearing, if the commissioner finds a violation, or upon failure
of the accused to appear at the hearing, the commissioner shall impose
whatever penalties allowed under subsection (d) as the commissioner
considers advisable.
(f) Subsection (a) does not relieve an insured of any obligation that
may exist to reimburse any agency, insurance producer, broker,
premium finance company, or other person for amounts advanced to
the insurer on behalf of the insured.
As added by Acts 1979, P.L.255, SEC.1. Amended by
P.L.29-1987, SEC.4; P.L.255-1995, SEC.11; P.L.178-2003,
SEC.78.