Chapter 431 — Chapter 431

§431:6-403 Disposal of ineligible property and securities. (a) Any personal property or securities lawfully acquired by an insurer, which it could not otherwise have invested in or loaned its funds upon at the time of the acquisition, shall be disposed of by the insurer within th…

§431:6-404 Authorization of investments. No investment, loan, sale, or exchange, except a loan upon a life insurance policy, shall be made by any domestic insurer unless authorized or approved by its board of directors or by a committee charged by the board of directors, or the b…

PART V. INVESTMENT OF FOREIGN AND ALIEN INSURERS §431:6-501 Investments of foreign, alien insurers. The investments of a foreign or alien insurer shall be as permitted by the laws of its domicile, but shall be of a quality substantially as high as those required by this article f…

PART VI. INVESTMENT POOLS §431:6-601 Insurer investment pools. (a) For purposes of this section: "Business entity" means a corporation, limited liability company, association, partnership, joint stock company, joint venture, mutual fund trust, or other similar form of business or…

ARTICLE 7 FEES, TAXES AND DEPOSITS PART I. FEES §431:7-101 Fees. (a) The commissioner shall collect, in advance, the following fees: (b) The fees for services of the department of commerce and consumer affairs subsequent to the issuance of a certificate of authority, license, reg…

PART II. TAXES §431:7-201 Annual and monthly tax statements. (a) Each authorized insurer shall electronically file with the commissioner annually, on or before March 1 in each year, a statement signed by a duly authorized person on its behalf, setting forth the total business tra…

§431:7-202 Taxation. (a) Each authorized insurer, except with respect to all life insurance contracts, ocean marine insurance contracts, and real property title insurance contracts, shall pay to the director of finance through the commissioner a tax of 4.265 per cent on the gross…

§431:7-203 Administrative refunds. (a) If any person has paid to the commissioner any tax, fee, or other charge in error or in excess of that which the person is lawfully obligated to pay under this code, the commissioner, upon written request made by the person to the commission…

§431:7-204 In lieu provision. As to insurers, the taxes and fees imposed by section 431:7-201 to section 431:7-204, and the fees imposed by this code, when paid shall be in settlement of and in lieu of all demands for taxes, licenses, or fees of every character imposed by the law…

§431:7-205 Reports to department of taxation. The commissioner shall promptly report to the department of taxation all amounts of taxes collected under section 431:7-201 to section 431:7-204 and section 431:8-315 and all amounts of refunds of such taxes made under section 431:7-2…

§431:7-206 Domestic company credit for retaliatory taxes paid other states. If by the laws of any state other than this State, or by the action of any public official of another state, any insurer or company, as defined in section 431:1-202, organized or domiciled in this State, …

PART III. DEPOSITS §431:7-301 Deposits of insurers. (a) The director of finance shall accept, when made through the commissioner, deposits of securities or funds by insurers as follows: (b) This part shall apply to the deposits listed in this section unless expressly inconsistent…

§431:7-302 Purpose of deposit. Each deposit shall be held by the director of finance in trust for the protection of all policyholders, obligees, or creditors in the United States of the insurer making it. [L 1987, c 347, pt of §2]

§431:7-303 Securities eligible for deposit. All deposits shall consist of cash or other assets comprised of securities which are eligible for the investment of the funds of insurers under section 431:6-301 representing public obligations, and section 431:6-302 representing corpor…

§431:7-304 Record and receipt. (a) The director of finance shall keep a record in permanent form of all such funds and securities. (b) The director of finance shall deliver to the insurer a receipt for all funds and securities so deposited by it. [L 1987, c 347, pt of §2]

§431:7-305 Transfer of securities. (a) No transfer of any funds or security so held on deposit, whether voluntary or by operation of law, shall be valid unless approved in writing by the commissioner and countersigned by the director of finance or by the director's authorized dep…

§431:7-306 Director may designate depositary. At the request of an insurer, the director of finance may designate any solvent trust company or other solvent financial institution having trust powers, domiciled in the United States, as the director's depositary to receive and hold…

§431:7-307 Responsibility for deposits. This State shall be responsible for the safekeeping and return of all funds and securities deposited pursuant to section 431:7-301 to section [431:7-311] with the director of finance. The insurer shall be responsible for the safekeeping and…

§431:7-308 Dividends and substitutions. While solvent and complying with this part, an insurer shall be entitled:

§431:7-309 Release of deposit. (a) Any required deposit or portion thereof shall be released in these instances only: (b) No such release shall be made except on application to and written order of the commissioner made upon proof satisfactory to the commissioner of the existence…

§431:7-310 Voluntary excess deposit. An insurer may deposit and maintain on deposit with the director of finance through the commissioner funds and eligible securities in amount exceeding its required deposit under this part by not more than $100,000 for the purpose of absorbing …

§431:7-311 Not subject to levy. No judgment creditor or other claimant of an insurer shall levy upon any deposit held pursuant to this article or upon any part hereof. [L 1987, c 347, pt of §2]

ARTICLE 8 UNAUTHORIZED INSURERS AND SURPLUS LINES PART I. GENERAL PROVISIONS §431:8-101 Scope. This article shall apply to the placement of insurance in insurers not authorized to transact insurance in the state in which the subject resident is located or in which the insurance c…

§431:8-102 Definitions. As used in this article: "Approved continuing education course" means a course approved by the commissioner following receipt of recommendations from insurance professionals. "Approved course provider" means an individual or entity that is approved to offe…

PART II. UNAUTHORIZED INSURERS §431:8-201 Transacting insurance business without certificate of authority prohibited. It shall be unlawful for any insurer to transact an insurance business in this State, as defined in section 431:1-215, without a certificate of authority; provide…

§431:8-202 Acting for or aiding unauthorized insurer prohibited. (a) No person shall directly or indirectly act as producer for, or otherwise represent or aid on behalf of another, any unauthorized insurer in the solicitation, negotiation, procurement, or effectuation of insuranc…

§431:8-203 Validity of contracts illegally effectuated. A contract of insurance effectuated by an unauthorized insurer in violation of this article shall be voidable except at the instance of the insurer. [L 1987, c 347, pt of §2]

§431:8-204 Liability of person assisting unauthorized insurer. 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 procurem…

§431:8-205 Insurance independently procured; duty to report and pay tax. (a) Nothing in this part shall prohibit a person from independently procuring, continuing, or renewing insurance from an insurer which is not authorized to transact insurance in this State. (b) Each insured …

§431:8-206 Commissioner may enjoin unauthorized insurers. Whenever the commissioner believes, from evidence satisfactory to the commissioner, that any insurer is violating or about to violate the provisions of section 431:8-201, the commissioner may bring an action in accordance …

§431:8-207 Legal process against unauthorized insurer; how service of process made. (a) Any act of transacting an insurance business in this State by any unauthorized insurer is equivalent to and shall constitute an irrevocable appointment by such insurer, binding upon the insure…

§431:8-208 Defense of action by unauthorized insurer; bond. (a) Before any unauthorized insurer files or causes to be filed any pleading in any court action, suit, or proceeding, or any notice, order, pleading, or process in an administrative proceeding before the commissioner, i…

§431:8-209 Attorney's fees. In an action against an unauthorized insurer upon a contract of insurance issued or delivered to a person in this State, if the insurer has failed for thirty days after demand prior to the commencement of the action to make payment in accordance with t…

§431:8-210 Advertising prohibited. (a) No publication published in this State, or radio or television broadcaster, or any other agency or means for the dissemination of information operated or located in this State shall publish, broadcast, or otherwise disseminate within this St…

§431:8-211 Penalties. (a) Any person, other than an insured, who represents or aids an unauthorized insurer in violation of this part may be subject to a fine not in excess of $1,000. (b) Any unauthorized insurer who transacts any unauthorized act of an insurance business as set …

§431:8-301 Insurance placed with unauthorized insurer permitted. (a) In addition to section 431:8-205, insurance may be procured from an unauthorized insurer; provided that: (b) A surplus lines broker is not required to make a due diligence search to determine whether the full am…

§431:8-302 Surplus lines insurers. (a) No surplus lines broker shall, either knowingly or without reasonable investigation of the financial condition and general reputation of the insurer, place insurance with a financially unsound insurer or with an insurer engaging in an unfair…

§431:8-305 Evidence of insurance; changes; penalties. (a) Upon placing surplus lines insurance, the surplus lines broker shall as soon as reasonably possible deliver to the insured the policy or, if the policy is not available, the surplus lines broker's certificate, cover note, …

§431:8-306 Signature of broker and special endorsement of surplus lines policy. Every insurance contract procured and delivered as a surplus lines coverage pursuant to this part, including any evidence of insurance other than a policy, shall:

§431:8-307 Broker's duty to notify insured. No contract of insurance placed by a surplus lines broker under this part and no premium charged therefor shall be due and payable until the surplus lines broker, when business is originated by a surplus lines broker, or the producer, w…

§431:8-308 Surplus lines insurance valid. Insurance contracts procured as surplus lines coverage from unauthorized insurers shall be fully valid and enforceable as to all parties, and shall be given recognition in all matters and respects to the same effect as like contracts issu…

§431:8-309 Effect of payment to surplus lines broker. Payment of a premium to a surplus lines broker acting for a person other than the surplus lines broker in negotiating, continuing, or reviewing any policy of insurance under this part shall be deemed to be payment to the insur…

§431:8-310 Surplus lines broker license required; application and qualifications for license. (a) No person shall procure any contract of surplus lines insurance with an unauthorized insurer unless the person is licensed as a surplus lines broker. (b) A person applying for a surp…

§431:8-312 Records of surplus lines broker. (a) Each licensed surplus lines broker shall keep in the broker's office in this State a full and true record of each surplus lines contract placed by the broker including a copy of the policy, certificate, cover note, or other evidence…

§431:8-313 Surplus lines broker's reports to commissioner. (a) Each surplus lines broker shall file electronically with the commissioner within forty-five days of the end of each calendar quarter a verified statement of all surplus lines insurance transacted during the calendar q…

§431:8-314 Surplus lines advisory organizations. (a) An advisory surplus lines organization of surplus lines brokers may be formed to: (b) Every such advisory organization shall file with the commissioner: (c) The commissioner shall, at least once in every five years, make or cau…

§431:8-315 Tax on surplus lines. (a) Within forty-five days after the end of each calendar quarter, each surplus lines broker shall pay to the director of finance, through the commissioner via the National Association of Insurance Commissioners' Online Premium Tax for Insurance o…

§431:8-316 Penalty for failure to file statement or remit tax. (a) If any surplus lines broker fails to: the surplus lines broker may be liable for a fine of up to $25 for each day of delinquency. (b) The commissioner may:

§431:8-317 License denial, nonrenewal, suspension, or revocation. (a) The commissioner may deny, place on probation, suspend, revoke, or refuse to issue or renew any surplus lines broker's license and may levy a civil penalty in accordance with articles 2 and 3, or any combinatio…

§431:8-318 Examination of surplus lines broker's accounts and records. Whenever deemed necessary the commissioner may examine the records and accounts of any surplus lines broker to determine whether the broker is conducting business in accordance with the requirements of this ar…