Chapter 8

Fines

The Commissioner may, after a hearing, impose an administrative ____________ if an insurer, or its representative: Failed to use diligence in processing claims, failed to pay claims in a timely manner, or failed to provide proper notice when required as to the reason the insurer failed to make claim payments Compelled, without just cause, insureds or claimants to accept less than the amount due, or to bring action against an insurer to secure the full amount of the claim or settlement Accepted money or other remuneration for referring automobile or other property repair business, including glass breakage, to a particular repair company The ________ imposed cannot exceed $1,000 for each misconduct resulting in a violation, or $5,000 for each willful misconduct resulting in a violation.

Qualifications

The Commissioner will not issue a license to an individual who does not meet the qualifications or requirements as specified in the law. To qualify, and individual applicant must: Be a resident of Georgia who must reside and be present within the state for at least 6 months of every year or have a principal place of business in Georgia

Qualifications

The Commissioner will not issue a license to an individual who does not meet the qualifications or requirements as specified in the law. To qualify, and individual applicant must: Be at least 18 years of age

Qualifications

The Commissioner will not issue a license to an individual who does not meet the qualifications or requirements as specified in the law. To qualify, and individual applicant must: Be of good character

Exceptions

A person who administers a group plan for an employer, or is an employee of an insurer, as long as any administrative fee does not exceed 5% of the premiums collected

Exceptions

A person whose activities are limited to advertising through printed publications or mass media without the intent to solicit or transact insurance

Exceptions

A salaried employee of a credit or character reporting firm, not engaged in the insurance business but who may report to an insurer

Agency Licenses

Each principal and branch office of a business entity that sells, solicits, or negotiates insurance must obtain an agency license and renew biennially. An agency is subject to all penalties, fines, criminal sanctions and action of authorized agents.

Certificate of Authority

No person may act as an insurer or transact insurance in Georgia unless a ____________ has been granted by the Commissioner. To qualify, an insurer must comply with the provisions of the law as a domestic insurer as one of the following: Incorporated stock or mutual insurer Fraternal benefit society Nonprofit hospital or medical service corporation Lloyd's association; or Reciprocal insurer

Insurance Transaction

Solicitation and inducement Preliminary negotiations Effectuation of an insurance contract Transaction of matters that result from the effectuation of the contract

Individual Licenses

An agent is an individual appointed or employed by an insurer who sells, solicits, or negotiates insurance. An agent is considered an individual insurance producer and is required to be licensed for each line of authority to be transacted.

Exceptions

An attorney admitted to practice in Georgia, when handling the collections of premiums or advising clients about how insurance is incidental to the practice of law

Restrictions

An insurer that is qualified to transact insurance in Georgia may be authorized to transact any one kind or combination of kinds of insurance except as follows: A reciprocal insurer may not transact life insurance A Lloyd's insurer may not transact life insurance; and A title insurer is authorized to transact only title insurance

Requirement of Name

An insurer that uses a name that is similar to an already authorized insurer and creates uncertainty or confusion, or uses a name which would deceptively mislead as to the insurer's type of organization may not be authorized to transact insurance.

Exceptions

Employees of insurers engaged in the inspection, rating, or classification of risks or in the supervision of training agents and not engaged in any insurance transaction

Qualifications

The Commissioner will not issue a license to an individual who does not meet the qualifications or requirements as specified in the law. To qualify, and individual applicant must: Successfully complete an approved prelicensing course, which must contain a minimum of 20 hours of instruction per major line of authority. Exceptions to the prelicensing course requirement include applicants who: Apply for a property and casualty license and hold a CPCU, CIC, CISR, or CRM designation Apply for a life or health license and hold a CLU or FLMI designation Provide satisfactory evidence indicating successful completion of 2 college or university courses related to insurance in the applicable lines of authority or who hold a degree in insurance Apply for a temporary license or limited lines license

Insurance Commissioner

The chief officer of Georgia's Department of Insurance is the _________________, who is elected to office for a term of 4 years. The purpose of the department is to promote efficiency in operation and service to the public.

Classifications of Insurance

The following classes of insurance may be transacted: Life, accident, and sickness Property, marine, and transportation Casualty Surety Title Health Maintenance Organization

Exceptions

An employer, association, or officers, directors, employees or trustees engaged in the administration of an employee benefit program or trust plan, as long as no compensation is paid to such persons by the company issuing the contracts

Qualifications

The Commissioner will not issue a license to an individual who does not meet the qualifications or requirements as specified in the law. To qualify, and individual applicant must: Pass a required examination for licensure within 12 months of completing the prelicensing course, except for the following: An applicant licensed for the same lines of authority in another state submits an application for a license in this state within 90 days of the cancellation of the previous license will not be required to complete prelicensing education or examination. This exemption only applies if the prior state issues a certification that, at the time of cancellation, the applicant and license were in good standing for the line of authority requested. The same exemption applies if an individual licensed in another state moves to this state and applies within 90 days of establishing legal residence to become a resident licensee.

Exceptions

A license as an insurance agent is not required of the following: An officer, director, or employee of an insurer or agency that does not sell, solicit, or negotiate insurance and does not receive a commission as long as the activities are either managerial or administrative, or relate to underwriting or providing technical support Any person who willfully violates licensing requirements or compensation regulation may be found guilty of a misdemeanor.

Application for Certificate of Authority

To apply for a certificate of authority, an insurer must file an application showing its name, home office location or principal office in the United States if an alien insurer, kinds of insurance to be transacted, date of organization or incorporation, form of organization, state or country of domicile, names of general officers with the number of shares held by each general officer, a copy of its corporate charter, and bylaws. Foreign and alien insurers must provide additional information as determined by the Commissioner. The application must be accompanied by the required fee, which will be returned if the application is denied. The Commissioner has 90 days to approve or disapprove an application. If no action is taken within that time frame, the application is considered approved. The certificate will specify the kinds of insurance the insurer is authorized to transact in Georgia. Certificates of authority expire at Midnight on June 30 of the year following date of issuance or renewal. Renewal forms must be filed by March 1 preceding expiration. Certificates must be renewed annually.

Exceptions

A salaried full-time person who counsels or advises an employer relative to the insurance interests of the employer as long as the employee does not sell, solicit, or negotiate insurance or receive a commission

Language Simplification

All personal homeowners, tenants, and automobile insurance policies, individual life or health insurance policies, certificates of group insurance coverage and coverage booklets provided by insurers and issued or delivered in this state must be written in a simplified form. The information must be divided in logically arranged and captioned sections with readable language which complies with the nationally recognized reading ease standards that may be required by the Commissioner.

Commissions and Compensation

An insurer or agent may not compensate any person for services as an agent unless that person is duly licensed, except in the case of renewal or deferred compensation to a person who held a license when the compensation was earned. No person other than a duly licensed agent or counselor may accept commission or other valuable compensation from an insurer or duly licensed agency, agent, counselor or subagent. An insurer may pay commissions to a licensed agency in which all employees, directors, and officers who transact insurance are qualified insurance agents. Agents, subagents, and counselors may share commission with a licensed insurance agency.

Discretionary Refusal, Suspension, Revocation and Nonrenewal

The Commissioner may refuse to issue, or, after a hearing, refuse to renew or may revoke or suspend a certificate of authority if the insurer: Violates any insurance provision, law or regulation Knowingly fails to comply with or violates any rule or order of the Commissioner Is found to be in such condition that any further transactions in Georgia are deemed to be hazardous to its policyholders or to the public Compels claimants to accept less than the amount due to them or to bring an action against it to secure full payment Refuses to be examined Fails to pay any final judgment rendered against it in Georgia within 30 days after such judgment becomes final Is under the same general management or ownership as another insurer transacting direct insurance in Georgia without a certificate of authority, unless such company is a permitted surplus line insurer