§ 38-43-55 — Cancellation of producer contract by insurer; notification requirements; immunity from civil liability; confidentiality of documents.

(A) When a contract of a producer is canceled by the insurer represented, that insurer shall notify the department of the cancellation within the following guidelines and time period required of this section. The records furnished by insurers are for the use of the department solely and not for public inspection. (B) An insurer or authorized representative of the insurer that terminates the appointment, employment, contract, or other insurance business relationship with a producer shall notify the Director of Insurance within thirty days following the effective date of the termination, using a format prescribed by the director or his designee, if the reason for termination is one of the reasons set forth in Section 38-43-130 or the insurer has knowledge the producer was found by a court, government body, or self-regulatory organization authorized by law to have engaged in any of the activities in Section 38-43-130. Upon the written request of the director or his designee, the insurer shall provide additional information, documents, records, or other data pertaining to the termination or activity of the producer. (C) An insurer or authorized representative of the insurer that terminates the appointment, employment, or contract with a producer for any reason not set forth in Section 38-43-130, shall notify the director or his designee within thirty days following the effective date of the termination, using a format prescribed by the director or his designee. Upon written request of the director or his designee, the insurer shall provide additional information, documents, records, or other data pertaining to the termination. (D) The insurer or the authorized representative of the insurer shall promptly notify the Director of Insurance in a format acceptable to the director or his designee if, upon further review or investigation, the insurer discovers additional information that would have been reportable to the Director of Insurance in accordance with subsection (B) of this section had the insurer then known of its existence. (E)(1) Within fifteen days after making the notification required by subsections B, C, and D of this section, the insurer shall mail a copy of the notification to the producer at his or her last known address. If the producer is terminated for cause for any of the reasons listed in Section 38-43-130, the insurer shall provide a copy of the notification to the producer at his or her last known address by certified mail, return receipt requested, postage prepaid or by overnight delivery using a nationally recognized carrier. (2) Within thirty days after the producer has received the original or additional notification, the producer may file written comments concerning the substance of the notification with the director or his designee. The producer shall, by the same means, simultaneously send a copy of the comments to the reporting insurer, and the comments shall become a part of the director or his designee's file and accompany every copy of a report distributed or disclosed for any reason about the producer as permitted under subsection (G) of this section. (F)(1) In the absence of actual malice, an insurer, the authorized representative of the insurer, a producer, the insurance director, or an organization of which the Director of Insurance is a member and that compiles the information and makes it available to other insurance commissioners or regulatory or law enforcement agencies shall not be subject to civil liability. No civil cause of action of any nature shall arise against these entities or their respective producers or employees, as a result of any statement or information required by or provided pursuant to this section or any information relating to any statement that may be requested in writing by the Director of Insurance, from an insurer or producer; or a statement by a terminating insurer or producer to an insurer or producer limited solely and exclusively to whether a termination for cause under subsection (B) of this section was reported to the Director of Insurance, provided that the propriety of any termination for cause under subsection (B) of this section is certified in writing by an officer or authorized representative of the insurer or producer terminating the relationship. (2) In any action brought against a person that may have immunity under item (1) of this subsection for making any statement required by this subsection or providing any information relating to any statement that may be requested by the insurance director, the party bringing the action shall plead specifically in any allegation that item (1) of this subsection does not apply because the person making the statement or providing the information did so with actual malice. (3) Item (1) or (2) of this subsection does not abrogate or modify any existing statutory or common law privileges or immunities. (G)(1) Any documents, materials, or other information in the control or possession of the Department of Insurance that is furnished by an insurer, producer, or an employee or agent of it acting on behalf of the insurer or producer, or obtained by the Director of Insurance in an investigation pursuant to this section is confidential by law and privileged, is not subject to the Freedom of Information Act request, is not subject to subpoena, and is not subject to discovery or admissible in evidence in any private civil action. However, the Director of Insurance is authorized to use the documents, materials, or other information in the furtherance of any regulatory or legal action brought as a part of the director's duties. (2) Neither the director or his designee nor any person who received documents, materials, or other information while acting under the authority of the Director of Insurance is permitted or required to testify in any private civil action concerning any confidential documents, materials, or information subject to item (1) of this subsection. (3) In order to assist in the performance of the director's duties under this chapter, the director or his designee: (a) may share documents, materials, or other information, including the confidential and privileged documents, materials, or information subject to item (1), with other state, federal, and international regulatory agencies, with the National Association of Insurance Commissioners, its affiliates or subsidiaries, and with state, federal, and international law enforcement authorities, provided that the recipient agrees to maintain the confidentiality and privileged status of the document, material, or other information; (b) may receive documents, materials, or information, including otherwise confidential and privileged documents, materials, or information, from the National Association of Insurance Commissioners, its affiliates or subsidiaries and from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material, or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material, or information; and (c) may enter into agreements governing sharing and use of information consistent with this subsection. (4) No waiver of any applicable privilege or claim of confidentiality in the documents, materials, or information shall occur as a result of disclosure to the director under subsection (B) or as a result of sharing as authorized in item (3). (5) Nothing in this section shall prohibit the director or his designee from releasing final, adjudicated actions, including for cause terminations, that are open to public inspection pursuant to the Freedom of Information Act, to a database or other clearinghouse service maintained by the National Association of Insurance Commissioners, its affiliates or subsidiaries of the National Association of Insurance Commissioners. (H) An insurer, the authorized representative of the insurer, or producer that fails to report as required under the provisions of this section or that is found to have reported with actual malice by a court of competent jurisdiction may, after notice and hearing, have its license or certificate of authority suspended or revoked and may be fined in accordance with Section 38-2-10.

Legislative History

HISTORY: 2002 Act No. 323, SECTION 2, eff January 31, 2003.