1.0 Insurance Regulation 10%

Company regulation

regulations which include rules surrounding a Certificate of Authority; Insolvency; Policy Forms/Rates/Exceptions; and Financial Requirements.

Failure to provide department with a written response

failing to provide a written response to the department of insurance within 21 calendar days after receipt of any written inquiry from the department, unless a reasonable extension of time has been requested of, and granted by, the Superintendent will result in the Superintendent denying the issuance of a license, probation, suspension, revocation, or refusal to issue or renew a person's license.

Continuing education

24 hours of continuing education 3 of which must be ethic specific prior to renewal. Cannot take the same CE course within same compliance period but can take same course again in different compliance period. Cannot be carried over from another state or province. Superintendent may grant credit for course completed prior to written approval of course. Partial credit not allowed must complete entire course to obtain credit if credit is not dependent upon results of an examination. Unless course is 30 hours or longer; Superintendent acknowledges in writing and number of CE hours approved by Superintendent is less than total number of course hours may not be required to complete entire course. Only qualifies for CE if both course and provider approved by Superintendent. Credit hours awarded in 1 compliance period cannot carry over or apply to any other compliance period. May receive up to 10 hours of CE's per reporting period for publication of articles or books authored by the licensee. Request for such credit must be made in writing accompanied by proof of authorship and publication. The Superintendent awards such credit. Instructors for approved CE courses may receive credit 2 times the number of hours actually spent instructing course. Licensees can earn up to 4 credits per renewal for participation in certain association meetings and activities.

Exemptions from CE Requirements

A License renews biennially (every 2 years) by the last day of the agent's birth month. Exempt: title insurance; surety bail bond; limited lines-also not required to complete prelicensing or exam; credit insurance; rental car; crop insurance; funeral expense; travel insurance; title insurance marketing rep; nonresident agents in compliance in home state; persons granted inactive status by State Director of Insurance; renewal extensions.

Maintenance and Duration of license

A resident insurance agent license will be perpetual unless surrendered by the licensee, or suspended or revoked by the Superintendent. May be an individual applicant or a business; A Licensee can qualify for several lines of business including a surplus lines broker.

Non-Resident License

Any person who is not a resident of this state and who sells, solicits, or negotiates a contract of insurance covering commercial property and casualty risks located in more than one state, if the person is licensed as an insurance agent to sell, solicit, or negotiate that insurance contract in the state where the insured maintains its principal place of business and the contract insures risks located in that state; must report change of address or change of state within 30 days to Superintendent or Superintendent's designee. Change does not change the license renewal date.

Unfair insurance trade practices

Anyone who commits any of the following acts is guilty of a 4th degree misdemeanor (an agent is justified in disobeying an insurer's instructions to commit an illegal act). Rebating; failing to fulfill refund obligation in timely manner; false advertising; misrepresentation; defamation of insurer; unfair discrimination and illegal inducements.

Premium refunds

Failing to fulfill a refund obligation in a timely manner (30 days after the date requiring refund action occurs; 30 days after the date of the insurer's refund check if the agent is expected to issue a portion of the total refund; 45 days after the date of the agent's statement of account on which the refund first appears)

Change in name, address, telephone number

If a licensed agent changes his/her address within his/her state or residence, he/she must file a change of address with the Superintendent within 30 days after making the change. This includes nonresident licensees who change their state of residence. 30 Day requirement also applies to changing state of residence, name, telephone number or email address.

Cease and desist orders

Issued if a licensed individual violates the insurance code, is causing or is about to cause harm. The order must be sent by certified mail, return receipt requested. The particular act must be specified along with the dates of the hearing. The hearing must be within 15 days of the order. Within 15 days after objections are submitted, the Superintendent will issue a final order either confirming or revoking the cease and desist order. A final order can be appealed in writing.

Acts constituting insurance transactions

Issuing, delivering contracts of insurance to residents of Ohio or corporations authorized to do business therein. No company, corporation, or association, may engage in the business of insurance, unless it is expressly authorized by the applicable state laws and those laws have been complied with. Transacting Insurance: Includes: making or proposing a contract; soliciting, taking, receiving application; receiving/collecting premium including commission, membership fee, assessment, dues or other consideration (money); disseminating (talking about) coverage or rates, applications, inspections, fixing rates, investigating or adjusting claims subsequent to effecting (starting a policy) insurance; No person can sell/solicit/or negotiate insurance in Ohio unless licensed in that line of authority.

Assumed business names

May NOT use any name other than the agent's legal name unless Superintendent is notified prior to use of the assumed name.

Requirements of license

Must complete 20 hours of authorized prelicensing education. Pre-licensing education is valid for 180 days from the date of completion, must pass exam within this time frame. Bachelor or Associate degree in insurance; a CPCU; or a CLU is exempt from prelicensing and examination requirements. Must submit full set of fingerprints and request criminal background check for submission to the superintendent.

Certificate of authority

The Superintendent will issue a Certificate of Authority to an insurer when it has: ■ Deposited the required amount of securities ■ Filed a duly certified copy of its Articles of Incorporation ■ Filed a copy of the Attorney General's approval ■ Filed a copy of its bylaws or constitution Annual statement must demonstrate solvency before renewal of certificate of authority. Certificates must be retained by the recorder for at least 2 years from the date of filing and will provide authority for agents to issue new policies.

Licensing

The licensing process protects the public interest by ensuring that licensees are competent and qualified to hold an insurance license and are held accountable for their actions. In Ohio, "License" means the authority issued by the superintendent to a person to act as an insurance agent for the lines of authority specified, but that does not create any actual, apparent, or inherent authority in the person to represent or commit an insurer.

Policy forms/rates/exceptions

When a policy loan is made, the insurer must notify the policyholder of the current interest rate being charged. Insureds must also be notified in advance of any interest rate increase. Insurers may file their rate schedules themselves or by becoming a member of, or a subscriber to, a licensed rating bureau which makes such filings. Ohio limits the fixed interest rate on policy loans to a maximum of 8%. Alternatively, the state allows adjustable interest rates on policy loans, which must be the lower of: ■ The published monthly average ending 2 months before the rate's determination date or ■ The rate used to compute the policy cash surrender values during the loan period plus 1% per year

Request for change to Inactive Status

agent, other than business entity, no longer engaged in insurance in any capacity that requires a license my apply to the Superintendent for inactive status. Agent must be in good standing, in compliance with CE's and no intent to engage in activity that requires a license for 24 months. Once granted exempt from CE requirements.

Agent appointment

an insurance agent shall not act as an agent of an insurer unless the insurance agent is appointed as an agent of the insurer. An insurance agent acts as an agent of an insurer when the insurance agent sells, solicits, or negotiates any product of the insurer and is compensated by the insurer. An insurer shall file a notice of appointment, with the Department, not later than thirty days (30 days) after the date of the agency contract is executed or the first insurance application is submitted, whichever is earlier. The insurer must pay the Superintendent a $20 fee for every appointment. Appointment by insurer certifies person is competent, financial responsible, and suitable to represent the insurer. Cannot be for the purpose of writing controlled business i.e. writing insurance for an agent's family, employees, or associates.

Cancellation of appointment

an insurer that terminates the appointment, employment, contract, or other insurance business relationship with an insurance agent shall notify the Department within thirty days after the effective date of the termination.

Illegal inducements

any of the following: ■ Giving anything of value as an inducement to purchase insurance ■ Stating, in order to commit an act of twisting, that an insurer was required to change an insurance form to comply with Ohio's insurance law ■ Whoever violates this section of the Revised Code is guilty of a misdemeanor of the 4th degree A promotional/advertising item with a value of $50 or less is not a valuable consideration if it is given to induce a person (insured or potentially insured) to obtain a quote and is not tied to the purchase of an insurance policy.

Failure to pay taxes

failing to pay state income taxes will result in the Superintendent denying the issuance of a license, probation, suspension, revocation, or refusal to issue or renew a person's license.

Negotiate insurance

means that one directly confers with, or advises someone as to the terms, benefits, or conditions of a particular insurance contract, provided the person that is conferring or offering advice either sells insurance for an insurer (acts as a solicitor or agent), or arranges the purchase of insurance for buyers (acts as a broker or counselor)

False advertising

presenting information to the public which is untrue, deceptive, or misleading. Including: ■ Presenting or advertising a policy's terms, benefits or advantages which are not true ■ Knowingly entering false information or omitting true information in any book, report or record with the intent to deceive official examiners of such materials ■ Whoever violates this section of the Revised Code will be fined $500 for a first offense and $1,000 for each subsequent offense

Violation of a Cease and Desist Order

the civil penalty may be as much as $10,000 per violation. If there is no other penalty provided in code the civil penalty can be a fine up to $25,000 and imprisonment of 6 months or both if a person violates any law relating to the Superintendent or any law relating to insurance.

Criminal

soliciting, negotiating and selling without proper license is a misdemeanor of the first degree; failing to make required reports under insurance code or implementing any form of advertising without complying with state laws fines no less than $100 or more than $500; selling for or representing an unauthorized insurer (unless surplus lines broker) or if a surplus lines broker and soliciting/procuring/placing/or renewing insurance with an unauthorized insurer and not practicing due diligence requirements fine not less than $25 or more than $500 or imprisonment for not more than 1 year or both; Selling shares or receiving compensation (money) for selling shares of capital stock for any life insurance company or agency for which a person is appointed to sell life insurance will be fined not less than $25 or more than $500 or imprisonment of no more than 6 months or both.

Resident License

A resident license may be issued by the Superintendent to an individual who is at least 18 years of age; a U.S. citizen or legally authorized to work in U.S.; or a business that is registered or maintains main office in Ohio; has a licensed agent designated for compliance; has not done anything to justify denying, suspending, or revoking the license

Termination notification

An insurer that terminates the appointment, employment, contract, or other insurance business relationship with an agent must notify the Superintendent within 30 days after the termination effective date. The insurer must provide any additional information, documents, records and other relevant data."Terminate" means to cancel the relationship between an insurance agent and the insurer or to terminate an insurance agent's authority to transact insurance. Within 15 days after notifying the Superintendent, insurer must mail a copy of the notification to agent at last known address. If terminated for any disciplinary action the notification must be sent by certified mail, return receipt requested, postage prepaid, or by overnight delivery using a nationally recognized carrier. Within 30 days after receiving a copy of such notification, an agent may file written comments with the Superintendent. At the same time, the agent must file a copy of the comments to the insurer. Comments become part of the Superintendent's file on the agent and must accompany every copy of any report distributed or disclosed for any reason about the agent.

Unfair discrimination

any of the following: ■ Permitting individuals of the same class and hazard to be charged different rates for the same insurance coverage (unless the rate differential is based upon sound actuarial principles or is related to actual experience) ■ Refusing to issue, cancel, or decline an insurance policy based on sex or marital status ■ Making any distinction or discrimination on the basis of race as to premiums or rates charged for life policies ■ Using underwriting standards that charge different rates for the same coverage based on a person's handicap

Duty to report criminal convictions and administrative disciplinary actions

Must notify Superintendent within 30 days of administrative action and include a copy of the order, consent to order, or any other relevant legal document. 30 days to notify for any criminal prosecution other than misdemeanor traffic after initial appearance before judge or magistrate. Notice must include certified copy of the charging document. Within 30 days after disposition, must provide certified copy of the court's entry/order that reflects final disposition of the prosecution and any other relevant legal documents.

license probation

a disciplinary action the Superintendent may take against a licensed agent.

Reporting of felony and crimes of moral turpitude

must notify the Superintendent of any administrative action taken against the licensee in another jurisdiction or by another governmental agency within 30 days after the matter's final disposition. A licensee must notify the Superintendent of Insurance if the licensee is subject to any criminal prosecution, by any jurisdiction, other than for a misdemeanor traffic violation. The licensee must provide notice within 30 days after his/her initial appearance before a judge or magistrate. In addition, the licensee must provide the Superintendent with a certified copy of the court's entry or order that reflects the final disposition of the case, within 30 days after its final disposition.

license revocation

refers to the cancelling or annulment of something by some authority. When revocation happens, a privilege, title, or status is removed from someone. If the Superintendent revokes your license, you can no longer sell or service insurance in the state of Ohio. The Superintendent has the authority to permanently revoke all of the person's licenses for all lines of insurance.

License denial

the Superintendent may deny a license for incorrect, misleading, incomplete or materially untrue information in license or appointment application;

license suspension

A license suspension is a disciplinary action. An agent has the right to appeal the action and receive a hearing before the Court of Common Pleas in Franklin County. The licensee must provide the agency with a notice of appeal within 15 days of their action. This is not to be confused with surrendering a license. Any person licensed in Ohio may surrender any or all licenses at any time unless under investigation by the Superintendent.

Commissions, compensation, fees

An insurance company can pay commissions or compensation only to a properly licensed (and appointed, if applicable) agent of the company. An unlicensed person may be compensated for a referral to a licensed agent so long as the person does not discuss specific insurance policy terms and conditions. The compensation must be a fixed dollar amount for each referral and cannot depend on whether the referred person purchases an insurance product. A licensed agent of an insurance company may pay commissions to another licensed agent for the procurement of insurance as long as both agents are licensed in the same line and the insurance companies are authorized to do business in this state. Such compensation cannot be based on the policy premium amount. A person cannot accept a commission or other compensation for selling, soliciting or negotiating insurance in Ohio if that person is required to be licensed but is not so licensed. An insurer must pay commissions or other compensation for any activity requiring a license to the licensee's legal or trade name. Agent must meet conditions to be allowed to charge a fee.

Insolvency

For an insurer issuing only assessable fire insurance policies, insolvency is: ■ The inability to pay any obligation within 30 days after it becomes payable or ■ If an assessment is made within 30 days after such date, the inability to pay the obligation 30 days following the date specified in the first assessment For any other insurer, insolvency is determined when it is unable to pay its obligations when due, or when its admitted assets do not exceed its liabilities plus the greater of either of the following: ■ Any capital and surplus required by law for its organization ■ The total par or stated value of its authorized and issued capital stock

Inactivity due to military service or Extenuating Circumstances

If inactive for 2 or more years may request return to active status but must meet the following conditions within 6 months of the reactivation application: Complete CE credits or Complete a prelicensing course for the license being reactivated. While Inactive cannot engage in or assist in transactions which require a license. Penalty: agent's license may be suspended or revoked or Superintendent may impose penalty of up to $25,000.

Insurance fraud regulation

Insurance fraud is a misdemeanor of the 1st degree. If the amount of the claim that is false or deceptive is: ■ $1,000-$7,500, the fraud is a felony of the 5th degree ■ $7,500-$150,000, the fraud is a felony of the 4th degree ■ $150,000 or more, the fraud is a felony of the 3rd degree In the absence of fraud, no individual (including the Superintendent or an employee of the Superintendent) is subject to liability for damages (e.g. libel or slander). Documents not subject to subpoena in civil actions by any court of this state. All applications and claim forms must clearly contain a warning substantially as follows: "Any person who, with intent to defraud or knowing that he is facilitating a fraud against an insurer, submits an application or files a claim containing a false or deceptive statement is guilty of insurance fraud." If an insurer has a reasonable belief that a person is perpetrating an insurance fraud, it must notify the department of insurance. No notification is required if fraud is suspected in connection with claims of less than $1,000.

Penalties for non-compliance with CE Requirements

Licensed agents are ineligible for renewal if not in compliance. Failing to meet CE requirements will result in a license suspension which becomes effective when the Superintendent mails a notice of 60 days. During this time, agent may provide proof of compliance. License may be revoked if agents fails to demonstrate compliance within 1 year after Superintendent provides licensee notice and opportunity for a hearing. If license is revoked due to CE compliance failure MUST apply for a new insurance agent's license. A single violation of any of the following is either a $500 fine or Superintendent's refusal to issue a license: knowingly using/submitting/filing false/deceptive document or record for purpose of complying with CE's or Superintendent inquiry; obtaining/accepting/using evidence of completion/participation from provider but didn't attend or complete course; cheating/using unauthorized materials/receiving unauthorized help during exam; assisting another person with CE's when person knows or should know assistance violates law; disruptive/threatening or deceptive behavior during course or exam which is grounds for both termination and Superintendent's acceptance of successful completion of course or exam; or use of unauthorized telecommunication device, exam notes, study guides or conversations with unauthorized person during an exam.

Renewal/nonrenewal of license...

Must complete Continuing Education to be eligible for renewal. Must apply for license renewal on or before renewal date or submit a late renewal application along with applicable fees prior to 1st day of 2nd month following license renewal date. A license that is not renewed is automatically suspended for nonrenewal on the 1st day of the 2nd month following renewal date. If suspended for nonrenewal, individual or business entity is eligible to apply for reinstatement within 12-month period following date license should have been renewed. Superintendent will automatically cancel a license that is suspended for nonrenewal after the 12 month date unless Superintendent is investigating allegations of wrongdoing. Exceptions for military service, long-term medical disability and extenuating circumstances if request is made in writing to the Superintendent. At least 30 days prior to a license holder's license expiration date, the Department will send a courtesy reminder to the license holder's mailing address. Regardless of the reminder notice being received, all license holders are responsible for renewing their license(s) by their license expiration date

Temporary license

The Superintendent may issue a Temporary Agent's license for up to 180 days without requiring the applicant to pass a written exam. May be issued to spouse or court-appointed representative if agent dies or becomes mentally or physically disabled; May be issued to designee if licensed agent enters active service in US Armed Forces. License no longer in effect once business is disposed of.

Rebating

Offering any rebate, discount of premium, or credit not specified in the policy. It is not rebating to: ■ Readjust group policy premiums based on actuarial data ■ Give life policyholders surplus from nonparticipating insurance ■ Reduce industrial life policyholders' premiums to reflect a decrease in the insurer's collection expenses. Rebating is returning a portion of the premium or the agent's/broker's commission on the premium to the insured or other inducements to place business with a specific insurer. Rebating is illegal in the majority of states. Insurers must use filed rate credits or have supporting methodology. Rebating Does NOT include the payment of commissions or other compensation; dividends; savings or unabsorbed premium deposits.

Director's general duties and powers

Superintendent is the CEO and Director of the Department of Insurance; empowered to adopt, amend and rescind rules necessary to discharge duties. Includes taking testimony under oath regarding alleged violation. If sufficient evidence can have person suspected arrested/charged.

Hearings

Superintendent must provide licensee/applicant with a notice of hearing before imposing penalty, denying, revoking, suspending or refusing to issue a license. Must serve hearing by certified mail/return receipt request to last know address. If returned mail, notice must be published once a week for 3 consecutive weeks in newspaper of record in county where last know address is located. If licensee/applicant has an attorney, a notice must also be mailed to him/her.

Financial requriements

Superintendent requires an annual audit of financial statement prepared by independent certified public accountants. Direct premiums written less than 1 million or having fewer than 1,000 policyholders at the end of year are exempt. However, Superintendent has right to deny exemption if necessary. To incorporate in Ohio, Superintendent must certify to Secretary of State that insurer has placed $100,000 paid in capital and $150,00 in contributed surplus in escrow. Foreign or mine subsidence insurance company required to deposit $50,000 of bonds with Superintendent. In lieu of deposit, must make deposit of $100,000 in securities in which the company may invest its assets with Superintendent or other officer of another state, designed or permitted by the laws of that state to receive the deposit for the benefit and security of all its policyholders. Such securities deposited with such Superintendent may be exchanged from time to time for other like securities, interest, dividends, or distributions can be collected on such deposit so long as the corporation depositing them continues solvent and complies with the laws of Ohio. No foreign guaranty company can be licensed unless at least $200,000 of its assets are invested securities permitted by laws of the state, district, or territory in which it is organized. If with another state, Ohio Superintendent of insurance must be given a certificate of such officer under his/her hand and official seal stating he/she is satisfied that such securities are worth at least $200,000, company can then be licensed to transact such business in Ohio.

Fraud and false statements including 1033 waiver

The 1033 federal regulation outlines the punishment for crimes by or affecting person engaged in the business of insurance whose activities affect interstate commerce. The 1033 Waiver allows those who are ineligible for licensing in insurance or the financial services to submit a waiver along with an application for an insurance license and the state will determine eligibility on an individual basis. Fees are not refundable if your application is denied.

Appointment procedures

The Department will only accept insurance agent and agency appointments and terminations electronically. Any paper appointments or terminations received by the Department, will be returned unless an exception has been approved. Electronic processing of appointments and terminations is mandated by Ohio Administrative Code 3901-5-09(K). Exception: Any insurer that annually appoints or terminates 25 or fewer agents or agencies will be exempt from filing electronically. However, the Department strongly encourages electronic filing. Agent appointments and terminations must be processed through NIPR or any one of its authorized business partners. You may submit a paper entry as instructed below only if your company qualifies for exemption or if an electronic entry has been rejected. If you are submitting a paper request because of a rejected transaction, documentation of the rejected transaction must be included with the request.

Consequences of Non-renewal

The consequences associated with the non-renewal of a Limited Line, Major Line (Personl Lines is a major line), Surety Bail bond, Title & Title Insurance Marketing Representative License include the following: One month late period: If agents do not renew their license by their license expiration date, they will have a one month late period to submit an application, provided they have satisfied any continuing education requirement they may have. In addition to the renewal fee (if required), the agent will be required to pay a $50 late fee. Please note, during the one month late period, an agent's license will remain active. If the license is not renewed during that one month late period, the license will be suspended and all company appointments will be terminated.

Unfair claim settlement practices

The following are not considered unfair claim settlement practices: ■ Failing to pay a claim prior to receiving a proof of loss ■ Failing to pay a claim for services received prior to the coverage effective date ■ Failing to pay a claim when a policy is in a lapsed status ■ Settling a claim by arbitration The insurer has 15 working days to acknowledge the receipt of a first-party claim, provide necessary claim forms, and reply to all other pertinent communications from the claimant. Insurers also have 15 days to respond to Department of Insurance requests for claim information. The insurer may request from the insured a proof of loss, which is a statement that provides details of the loss and is accompanied by any supporting documentation. The insured has 60 days to submit a proof of loss to the insurer.

Examination of books and records

Whenever the Superintendent deems it necessary, but at least once every 3 years, may make, or direct to be made, an examination of the affairs and financial condition of any insurance company in the process of organizing, applying for admission, or doing business in Ohio. This examination may be deferred up to 5 years if necessary. Must have free access to all books and papers including those kept by agents. If inadequate for exam, insurer may be required to employ experts to rewrite, post or balance with exam fees and expenses paid by company being examined. Directors, officer, agents, employees may be examined under oath. Refusal is grounds for suspension, refusal, or nonrenewal of any license or Certificate of Authority held by company. Insurer has 30 days after postmark on envelope in which report was mailed to file written objection to report with Superintendent. Superintendent has power to administer oaths, summon, and compel by order or subpoena attendance of witnesses to testify in relation to any matter, which by state laws, is the subject of inquiry and investigation. Can require the production of any book, paper, or document pertaining to such matter.

Penalties and fines for violations

a licensee is found to have committed an unfair trade practice, the Superintendent may levy a fine of $3,500 per violation, up to a maximum of $35,000. For a licensed agent who violates a Cease and Desist Order the civil penalty may be as much as $10,000 per violation. A person who violates any law relating to the Superintendent, or any law relating to insurance (if there is no other penalty provided in the Code) will be fined up to $25,000, imprisoned for up to 6 months, or both. Violating an order issued under a civil penalty allows the Superintendent to request the Attorney General to prosecute the party(s) involved in the name of the state. Court may impose a civil penalty of not more than $25,000 for each violation or injunctive relief; restitution; or any other appropriate relief. If licensed to sell life insurance cannot sell shares or be compensated for the sale of shares of capital stock of any life insurance company or agency for which person is appointed to sell life insurance-fines range from not less than $25 or more than $500 or imprisonment not more than 6 months or both. Selling for or representing an unauthorized insurer unless licensed surplus lines broker will be fined not less than $25 or more than $500 or imprisoned not more than 1 year or both. If surplus lines broker, must practice due diligence when soliciting, procuring, placing and renewing insurance through unauthorized insurer or will be fined not less than $25 or more than $500 or imprisoned not more than 1 year or both.

Other federal regulations (do not call list)

authorizes the FTC to collect fees for the implementation and enforcement of a Do-Not-Call Registry. Purpose is to prevent telemarketing and consumer fraud and abuse. The FTC's Telemarketing Sales Rule specifies both the registry fees and the reporting requirements for telemarketers. Later legislation prohibits the automatic expiration of registry listings. The CAN-SPAM Act of 2003 Establishes the first national standards for sending commercial e-mail and requires the FTC (Federal Trade Commission) to enforce its provisions. Regulates fraud and related activity in connection with electronic mail-provides for penalties for offenders

Controlled Business

controlled business is that which the agent can exercise his/her power over. Typically this refers to writing insurance for an agent's family, employees, or associates. In Ohio, if an agent places controlled business with an insurer in excess of 5% of the insurer's admitted assets in a single year, the insurer may not accept additional business from the controlling producer unless there is a written contract between them specifying the responsibilities of each party, approved by the board of directors. Each year the insurer must report to the Superintendent the amount of commissions paid by the insurer to the producer, the percentage that such amount represents of the net premiums written by the insurer, the amount of commissions paid by the insurer to each producer that is not in control of the insurer for the placement of the same kind of insurance, and the percentage that such amount represents of the net premiums written by the insurer.

Failure to appear for an interview

failing to appear for an interview will result in the Superintendent denying the issuance of a license, probation, suspension, revocation, or refusal to issue or renew a person's license.

Consumer information/fees

fees are a matter between the agent and the consumer. Fees cannot be contingent on something happening in the future such as the sale of a policy. All fees must be disclosed and agreed to in advance.

Civil

if Superintendent has reasonable cause to believe an order has been violated he/she may request Attorney General to prosecute the party(s) involved in the name of the state. The court may impose a civil penalty of not more than $25,000 per violation; injunctive relief; restitution; any other appropriate relief.

Agent regulation

includes commissions, compensation and fees; the reporting of felony and crimes of moral turpitude; and forgery of any document related to or used in an insurance transaction.

Insurance information privacy

insurance company or agent must provide a notice of information practices regarding insurance transactions to all applicants/policyholders. An abbreviated notice may be given, but the insurer must supply the full notice to the policyholder if it's requested. If renewal, must be provided no later than renewal date unless given within previous 24 months or personal information is collected only from policyholder or public record.

Policy/application signature

license may be suspended, revoked, or the Superintendent may refuse to issue or renew any license of an insurance agent, as well as assess a civil penalty, or impose any other sanctions if that agent forges or causes the forgery of an application for insurance, or the forgery of any document related to or used in an insurance transaction.

Defamation of insurer

making a false oral/written statement intended to injure someone in the insurance business. An example would be making a false statement about an insurer's financial condition.

Misrepresentation

making misleading representations or fraudulent comparison of insurance policies, misrepresenting the terms or benefits of an insurance policy, or making misleading representations as to the financial condition of any insurer. This includes: ■ Misrepresenting funds actually available for losses and claims or a subscribed capital not actually paid up in cash ■ Whoever violates this section of the Revised Code is guilty of a misdemeanor of the 4th degree ■ Presenting a financial standing that is different than what its last examination states

General grounds for disciplinary action

may be a Class A offense or a Class B offense. Examples of Grounds for disciplinary action(s) against an agent/broker under Class B include but are not limited to: ■ Failing to submit an insurance application within 7 days after accepting a premium ■ Failing to provide a written response to the department of insurance within 21 calendar days after receipt of any written inquiry from the department, unless a reasonable extension of time has been requested of, and granted by, the Superintendent. There are many more Class A offenses than Class B including for example: Failing to fulfill a refund obligation to a policyholder or applicant in a timely manner: □ 30 days after the date the policyholder, applicant, or insurer takes or requests action resulting in a refund □ 30 days after the date of the insurer's refund check, if the agent is expected to issue a portion of the total refund □ 45 days after the date of the agent's statement of account on which the refund first appears

Consent agreements

may be imposed by the Superintendent and accepted by licensee instead of a formal hearing process. Outcome has same legal effect as an order issued by Superintendent as a result of a formal hearing. Licensee is subject to same penalties for violating a consent order as they would for violating a cease and desist order. In addition; Superintendent may suspend, revoke, or refuse to issue or renew or assess a civil penalty or impose any other sanctions authorized in this chapter for failing to comply with any administrative or court order directing payment of state income tax; if business entity failing to report individual licensee's violation to the department when violation was known or should have been known by one or more partners, officers, managers, or members of the business entity; failing to provide a written response to the department of insurance within 21 calendar days after receipt of any written inquiry from the department; unless, a reasonable extension of time has been requested of and granted by the Superintendent.

Refusal to issue or renew license

may be issued by the Superintendent for any of the following: ■Providing incorrect, misleading, incomplete, or materially untrue information in a license or appointment application ■ Failing to submit an insurance application within 7 days after accepting a premium ■ Intentionally misrepresenting the terms and benefits of any actual or proposed insurance contract ■ Having been convicted of a felony or a misdemeanor involving: □ The misuse or theft of money or property belonging to another □ Fraud, forgery, dishonest acts, or breach of a fiduciary duty □ Moral turpitude ■ Having a license, or its equivalent, denied, suspended, or revoked in any other state, province, district, or territory ■ Cheating on a licensing exam ■ Forging any application or any document used in an insurance transaction ■ Failing to provide a written response to the department of insurance within 21 calendar days after receipt of any written inquiry from the department, unless a reasonable extension of time has been requested of, and granted by, the Superintendent ■ Committing any unfair trade act or practice ■ Demonstrating incompetence, untrustworthiness, or financial irresponsibility ■ Failing to pay state income taxes ■ Failing to appear for an interview

Solicit insurance

means to attempt to sell insurance to someone; it also means to ask or urge a person to apply for a particular kind of insurance from a particular insurer

Sell insurance

means to exchange or provide a contract of insurance to a purchaser in exchange for money (consideration) behalf of an insurer

Fair Credit Reporting Act

only those with a permissible purpose: Insurance company underwriting, when you apply for credit, collection agencies for your debt, employers - only with your permission. No friends, family, coworkers without your permission.