Title 56, Insurance

It is unlawful for the resident agent to sign the policy in blank.

The commissioner and the commissioner's deputies have the power to inquire into any violations of § 56-15-108 or § 56-15-109, and to examine any person or persons under oath.

The commissioner shall revoke for one (1) year the license of any company or agent found guilty of any violation of § 56-15-108 or § 56-15-109.

Any surety company doing business under this chapter may be sued in respect to doing business under this chapter in any court that has now, or hereafter may have, jurisdiction of actions or suits upon the recognizance, stipulation, bond, or undertaking in the county in which the …

Any company that executes or guarantees any recognizance, stipulation, bond or undertaking under this chapter shall be estopped, in any proceeding to enforce the liability that it has assumed to incur, to deny its corporate power to execute or guarantee the instrument or assume t…

If the company neglects or refuses to pay any final judgment or decree rendered against it upon the recognizance, stipulation, bond or undertaking made or guaranteed by it under this chapter, from which no appeal, writ of error or supersedeas has been taken for thirty (30) days a…

A company that fails to comply with §§ 56-15-102 — 56-15-107 and 56-15-112 — 56-15-114, shall forfeit to the state, for every failure, not less than five hundred dollars ($500) nor more than five thousand dollars ($5,000), to be recovered by suit in the name of the state of Tenne…

(a) This chapter is known and may be cited as the “Exchange or Reciprocal Insurance Act of 1990.” (b) This chapter shall apply to all reciprocals and reciprocal insurance as defined in § 56-16-102.

(a) As used in this title, unless the context otherwise requires:(1) “Reciprocal” means the aggregation of subscribers under a common name; and(2) “Reciprocal insurance” means insurance resulting from the mutual exchange of insurance contracts among persons in an unincorporated a…

A reciprocal licensed to transact the business of insurance in this state may write the classes of insurance enumerated in § 56-2-101.

Except as otherwise provided, all the provisions of this title relating to insurers generally, and those relating to insurers writing the same classes of insurance that reciprocals are permitted to write, are applicable to reciprocals.

(a) Persons of this state may enter into reciprocal insurance contracts with each other and with persons of other states and countries, providing indemnity among themselves from any loss that may be insured against under other laws, excepting life insurance. (b) For any corporati…

Every reciprocal shall have and use a business name that includes the word “reciprocal,” “interinsurer,” “interinsurance,” “exchange,” “underwriters” or “underwriting.”

No reciprocal shall engage in any insurance transaction in this state until it has obtained a license to do so in accordance with the applicable provisions of chapter 2, part 1 of this title.

No foreign reciprocal shall be licensed to transact the business of insurance in this state unless it has filed with the department a certificate of the supervising insurance official of the state in which it is organized. The certificate shall show that the foreign reciprocal is…

Nothing in this title regarding the admission and licensing of foreign and alien insurers requires that the attorney of a foreign or alien reciprocal be a resident or domiciled in this state, or that the principal office of the attorney be maintained in this state. The office or …

Reciprocal insurance contracts shall be executed by the attorney of the reciprocal.

No person shall act in this state as an agent of a reciprocal in the solicitation or procurement of applications for insurance, subscriber's agreements and powers of attorney, or in the collection of premiums in connection with the reciprocal insurer, without first procuring a li…

(a) Each subscriber insured under an assessable policy shall have a contingent assessment liability for payment of actual losses and expenses incurred while the subscriber's policy was in force. This shall be in the amount provided for in the power of attorney or subscriber's agr…

(a) The department may issue a certificate authorizing the reciprocal to reduce or extinguish the contingent assessment liability of subscribers under its policies then in force in this state, and to omit provisions imposing contingent assessment liability in all policies deliver…

A reciprocal may return to its present or past subscribers, or both, any savings or credits accruing to their accounts. The distribution shall not unfairly discriminate between classes of risks or policies, or between subscribers. However, the distribution may vary for classes of…

Each reciprocal shall maintain the same unearned premium and loss or claim reserves required for stock and mutual companies writing the same classes of insurance.

(a) (1) Each attorney of a domestic reciprocal who files the declaration required by § 56-16-201, and each attorney of a foreign or alien reciprocal who applies for a license to transact the business of insurance in this state, shall file with the department a written power of at…

(a) Any reciprocal doing business in this state may sue or be sued in the name or designation under which its insurance contracts are effected. (b) (1) Any action or suit against a reciprocal may be brought in any county where:(A) Its principal office is located; or(B) The cause …

Any judgment against a reciprocal based upon legal process duly served as provided in this chapter shall be binding upon the reciprocal and upon each of the reciprocal's subscribers as their respective interests may appear, in an amount not exceeding their respective contingent a…

Section 56-3-103 shall not bar a person who performs legal or other professional services for a reciprocal from serving as a member of the board of directors, or committee of the board, or as an officer of the reciprocal because the person receives payment for legal or other prof…

(1) Subscribers contracting among themselves pursuant to part 1 of this chapter shall, through their attorney, file with the commissioner a declaration verified by the oath of the attorney, setting forth:(1) The name or title of the office at which the subscribers propose to exch…

The attorney shall maintain on deposit with the department an equal amount in cash or in value of securities as required by § 56-2-104(a)(4).

The board of directors exercising the subscribers' rights in a domestic reciprocal shall be selected under rules adopted by the subscribers. At least three-fourths (¾) of the board shall be composed of subscribers other than the attorney or any person employed by, representing or…

(a) Every subscriber of a domestic reciprocal may execute a subscriber's agreement and power of attorney setting forth the rights, privileges and obligations of the subscriber as an underwriter and as a policyholder, and the powers and duties of the attorney. If the reciprocal do…

Modification of the terms of the power of attorney and subscriber's agreement of a domestic reciprocal shall be made jointly by the attorney and the board of directors. The modification shall be filed with the attorney and the department, and the filing shall by operation of law …

The attorney or other interested persons may advance to a domestic reciprocal any funds required in its operations. The funds advanced shall not be treated as a liability of the reciprocal and shall not be withdrawn or repaid except out of the reciprocal's earned surplus in exces…

(a) Assessments may be levied upon the subscribers of a domestic reciprocal by the attorney in accordance with § 56-16-112. The assessments shall be approved in advance by the board of directors and the department. (b) Each domestic reciprocal subscriber's share of a deficiency f…

(1) Every subscriber of a domestic reciprocal having contingent assessment liability shall be liable for and shall pay the subscriber's share of any assessment computed in accordance with § 56-16-207 if, while the policy is in force or within one (1) year after its termination, t…

Upon the liquidation of a domestic reciprocal, its assets shall be distributed pursuant to chapter 9 of this title.

(a) (1) The domestic reciprocal's attorney shall levy an assessment upon subscribers made subject to assessment by the terms of their policies for the amount needed to make up the deficiency, if:(A) The assets of a domestic reciprocal are at any time insufficient to settle the su…

(1) As used in this chapter:(1) “Commissioner” means the commissioner of commerce and insurance;(2) “Department” means the department of commerce and insurance;(3) “Discount plan”:(A) Means a card, or other purchasing mechanism or device, that is not insurance and purports to off…

(a) An operator of a discount plan must obtain a valid certificate of registration from the commissioner. A certificate of registration is not required for a marketer. A certificate of registration is valid for one (1) year from the date of issuance. In order to receive a valid c…

(a) A discount card or materials distributed on behalf of a discount plan covered under this chapter must expressly provide, in bold and reasonably prominent type, that the card or plan does not constitute insurance. The card or distributed materials must also contain a toll-free…

(a) A member has the right to cancel membership in a plan within thirty (30) days of joining the plan and has the right to have refunded membership fees paid during that initial membership, except for a one-time nominal processing fee. (b) After the initial thirty-day membership …

(a) An operator or marketer shall not:(1) Describe or characterize the discount plan as being insurance;(2) Use or approve for use in its cards or distributed materials the terms “health plan,” “coverage,” “copay,” “copayments,” “deductible,” “preexisting conditions,” “guaranteed…

(a) As part of an examination or investigation, the commissioner may request, and the operator or marketer shall provide, copies of materials that are distributed to prospective members. (b) After notice and hearing, the commissioner may levy an administrative penalty, in an amou…

Any company may restrict its business to the insurance of the lives of its members or stockholders alone, it being the intent of this section to permit of a corporate existence to any professional association, guild, brotherhood or other mutual association, the right, by an arran…

(a) A domestic mutual life insurance company operating under this chapter shall not receive an original or renewal certificate of authority from the commissioner to issue policies or contracts of insurance unless it possesses and maintains capital or surplus funds as required by …

The corporate powers of a mutual life insurance corporation shall be exercised by, and its business and affairs shall be under the control and government of, a board of directors composed of not less than fifteen (15) nor more than twenty-one (21) natural persons who are policyho…

In order to secure continuity of membership in its board of directors, the bylaws of the corporation may provide for division of the board into no more than seven (7) classes as nearly equal in number as possible, and may fix the term of office for each class. Unless such provisi…