GA Law Supplement

Reduction in Coverage

A change made by the insurer that results in: - a removal of coverage - diminution in scope or less coverage - the addition of an exclusion

Personal Auto Policy Premium Reductions

A personal auto policy discount of at least 10% must be offered if all named drivers: - have committed NO traffic offenses or claims for the prior 3 years - (>25 years old) have completed an approved defensive driving course - (<25 years old) have completed an approved preparatory course

Counselor

Advises people regarding the benefits, terms, value, or advantages of any insurance contract offered by an insured

Binders

(or other contracts for temporary insurance) may be made orally or in writing and include all the usual terms of the policy together with any applicable endorsements that are designated.

Insurance Department sections include:

- Agent licensing - Consumer services - Regulatory services - Life, accident, and sickness insurance - Property & casualty insurance - Examinations

The agent licensing section does the following:

- approves formal classroom training courses - prepares and conducts all licensing examinations - issues licenses

2 years

Commissioner of Insurance - Insurance Fraud: Minimum prison time in addition to insurance fraud

Consultant

Cannot receive compensation from more than one source involving the same transaction

Felony

Commissioner of Insurance - Insurance Fraud: Insurance fraud is a ____________

Commercial Property Insurance: Additional Coverages:

Debris Removal: - up to 25% - additional $25,000 if needed Property Removal: 30 days Fire Dept Service Charge: $1,000 no deductible Pollutant cleanup & removal: $10,000 per policy period Electronic Data: $2500 per policy period

Rate Filings

Every insurer must maintain copies of its rates, rating plans, rating systems, underwriting rules, and policy or bond forms with the Commissioner

$20,000

Georgia Insurers Insolvency Pool: The Pool's maximum liability per covered claim is as follows: $________ for the return of unearned premium

$300,000

Georgia Insurers Insolvency Pool: The Pool's maximum liability per covered claim is as follows: $________ per claimant for all other covered claims

Full Amount

Georgia Insurers Insolvency Pool: The Pool's maximum liability per covered claim is as follows: ________ for workers' compensation claims

False Advertising

It is illegal for any producer to formulate or use an advertisement or statement that is untrue, deceptive, or misleading regarding any insurance company or persons associated with that company

Defamation

It is illegal to make any statement, written or oral, that is false or maliciously critical of the financial condition of an insurance company or a producer representing that company

Rebating

It is illegal to offer valuable consideration, other than that which is offered in the contract, as an inducement to purchase a policy

2 years

Legal Action Against Us: Gives the insured _______ years to bring an action against the insurer **Commercial Property Insurance conditions

45 days

Liberalization: More coverage WITHOUT more premium _______ days of policy's effective date **Commercial Property Insurance condition

3 years

Licensing - Agent's Certificate of Authority (agent appointment): Agents must renew their subagents' certificates of authority every ________ years

Annually

Licensing - Agent's Certificate of Authority (agent appointment): Insurers must renew their agents' certificates of authority ________

30 days

Licensing - Agent's Certificate of Authority (agent appointment): Insurers must report an agent's certificate of authority (appointment) termination within _____ days

24 hours

Licensing - Biennial Continuing Education (CE) requirement: _______ hours, if licensed for fewer than 20 years

3 hours

Licensing - Biennial Continuing Education (CE) requirement: ________ hours of the total CE hours must be in ethics

20 hours

Licensing - Biennial Continuing Education (CE) requirement: ________ hours, if licensed for 20 years or more

3-hour

Licensing - Flood Insurance Training Requirement: Flood Insurance requires a one-time ______ hour certification course

Age 18

Licensing: Applicant's minimum age

20 hours

Licensing: Applicants must complete ______ hours of prelicensing education per line of authority

90 days

Licensing: Nonresident producers moving to Georgia have this long to establish themselves as a resident producer (without taking Georgia prelicensing education or insurance exam)

70%

Licensing: Pass the licensing exam with a score of at least _____%

30 days

Licensing: Producers must report name or address change within _____ days

10 days

Nonrenewal or Cancellation: _____ days in advance for cancellation due to nonpayment of premium

Temporary License

The Commissioner may issue a ______________ _____________ to a family member, associate, guardian, or estate executor of a former agent who dies or becomes unable to carry out his duties because of any of the following: - Service in the US armed forces - Illness or disability - Termination of appointment by the insurer

Office of Treasury and Fiscal Services

The Commissioner must remit all fees, taxes, dues, and penalties collected to the ___________ ___ ____________ ____ ____________ _____________

Residual Market Mechanism

The Georgia Worker's Comp Assigned Risk Plan exists to provide required worker's comp coverage for employers who do NOT qualify for coverage in the voluntary market. Liability is apportioned among all insurers authorized to write worker's compensation in Georgia

Twisting

The illegal replacement practice of misrepresenting a policy to induce a policyholder to lapse, forfeit, or surrender an existing policy and purchase a new policy from a different insurer

Valued Policy (Liquidated Demand)

When the building is totally destroyed by fire, the insured has the right to demand the policy limits as the loss value. Does NOT apply to personal property

75 days

Worker's Compensation: Notice of Nonrenewal or Cancellation: ______ days in advance for nonrenewal or cancellation of workers' compensation policy

3 employees

Worker's Compensation: Unless exempt, businesses employing _____ or more employees MUST comply with the workers' compensation law

National Flood Insurance Program

requires a one-time, three-hour NFIP CE course

Agent

An individual appointed or employed by an insurer who sells, solicits, or negotiates insurance

90 days

Binders: Binders are valid up to ______ days or until the policy is issued, whichever period is shorter

5 years

Commissioner of Insurance - Examination: The period of time in which the Commissioner must conduct an examination of every authorized insurer

20 days

Commissioner of Insurance - Examination: Time frame for the Commissioner to provide the examinee a copy of the written report

30 days

Homeowners Insurance: Notice of nonrenewal must be sent within _____ days to the insured AND mortgage holder

30 days

Nonrenewal or Cancellation: _____ days in advance for cancellation for all other reasons

Reciprocity

The individual's resident state must allow Georgia agents to hold nonresident licenses

Attorney General

All rules and regulations made by the Commissioner must be approved by the ______________ _______________ and filed at the Commissioner's office for at least 10 days before they become effective.

Subagent

An individual who sells or negotiates insurance or annuity contracts on behalf of a licensed agent. Must have a certificate of authority from each agent represented on file with the Commissioner

Surcharges for Automobile Accidents

An insurer may not assess a premium surcharge or cancel the policy as a result of the insured's involvement in an accident where the insured was NOT at fault

5 years

Applicants for a counselor license must have ______________ years experience either as an agent, subagent, adjuster, or other insurance experience that, in the Commissioner's opinion, qualifies the applicant to act as a counselor

Exemption

Applicants licensed in another state are NOT required to take the prelicensing education or the licensing examination if the license application is received within 90 days of cancellation of the previous state license. The person must apply for a Georgia license within 90 days of moving to Georgia.

$25,000

Automobile Insurance - Financial Responsibility Minimum Liability Limits: Bodily injury or death to any one person 25/50/25

$50,000

Automobile Insurance - Financial Responsibility Minimum Liability Limits: Bodily injury or death to two or more people per accident 25/50/25

Cease and Desist Order

If a person appears to be violating the insurance code, the Commissioner may issue a ________ ___ _________ _________ prohibiting the person from continuing the act, practice, or transaction

$50,000

Licensing: Surplus lines broker must post a $________ bond with the Commissioner

Georgia Insurers Insolvency Pool

Provides a remedy for covered claims under property and casualty insurance policies when the insurer has become insolvent and is unable to fulfill its contractual obligations. All P&C insurers must be members of this as a condition of their authority to transact insurance in Georgia.

Controlled Business

The sale of an insurance product by an agent on the agent's own life, on the life of a family member, or on the life of an employee of the agent or family member. Such sales are not prohibited but may not exceed 25% of the premium volume written by an agent in the course of any 12-month period

$250, $500, $1,000

Uninsured Motorist Coverage: Uninsured motorist deductible options include: $________ deductible

Commercial Property Insurance: Coverage Extensions

80% coinsurance has been met newly acquired or constructed property - $250,000 building — 30 days - $100,000 personal property — 30 days Personal property of others — $2500 Valuable papers & records — up to $2500 Property OFF premises — $10,000 Outdoor property — $1000 total, $250 per tree Nonowned detached trailers — $5,000

$25,000

Automobile Insurance - Financial Responsibility Minimum Liability Limits: Property damage per accident 25/50/25

$10,000

Commissioner of Insurance - Insurance Fraud: Maximum fine for insurance fraud

$2,000

Commissioner of Insurance - Penalties: Maximum fine for each non-willful insurance code violation

30 days

Nonrenewal or Cancellation: _____ days in advance for nonrenewal

45 days

Nonrenewal or Cancellation: _____ days in advance for nonrenewal or cancellation of commercial insurance policies

Georgia Fair Access to Insurance Requirements (FAIR) Plan

Purpose is to make property insurance (fire and extended coverage-EC) available to urban property owners who are unable to obtain coverage in the normal markets. All companies in Georgia writing fire and EC policies are required to participate.

36 months

Automobile Insurance: Insurers may cancel automobile insurance policies if, within the past ______ months, the insured has had any of the following occur: - Had a driver's license suspended or revoked - Been convicted of operating a vehicle under the influence - Been convicted of three or more speeding tickets - Been convicted of criminal homicide or assault while operating a motor vehicle

Commercial Property Insurance: Building & Personal Property

Building: - completed additions - fixtures, including outdoor fixtures - permanently installed machinery & equipment - personal property used to maintain or service the premises (fire extinguishers) - outdoor furniture, floor coverings, and certain appliances - materials, equipment, supplies, and temporary structures within 100 feet of the described premises Business Personal Property: - furniture (desks, chairs) - fixtures (shelves, light fixtures) - machinery & equipment - stock - the value of labor, parts, or services on the personal property of others - tenants' improvements & betterments - leased personal property (copiers) Excluded Personal Property: - money, accounts, food stamps, notes, and securities - animals (boarded or held for sale IS covered) - bridges, roads, walks, patios, and other paved surfaces) - cost of excavations and other ground prep - foundations of buildings, structures, and machinery - underground pipes - vehicles (including watercraft & aircraft) that are licensed for use on public roads or are principally operated AWAY from premises The following property while OUTSIDE of building: - fences - antennas (satellite dishes), - signs NOT attached to building — $2500 available for ATTACHED signs - trees, shrubs, plants

30 days

Commissioner of Insurance - Hearings: Parties may request a rehearing within ______ days

30 days

Commissioner of Insurance - Hearings: The Commissioner must make an order on the hearing within _____ days

30 days

Commissioner of Insurance - Hearings: The hearing must be held no later than _________ days after the request was received

10 days

Commissioner of Insurance - Hearings: __________ days written notice to all interested parties

10 years

Commissioner of Insurance - Insurance Fraud: Maximum prison time in addition to insurance fraud

$5,000

Commissioner of Insurance - Penalties: Maximum fine for each willful insurance code violation

$10,000

Commissioner of Insurance - Penalties: Maximum fine for violating a cease and desist order

6 months

Licensing: Temporary licenses are effective for ______ months and can be renewed up to a total of 15 months

Georgia Automobile Insurance Plan (AIP)

Makes auto insurance, including garage liability for commercial risks, available to applicants who are entitled to coverage but are unable to get it through the voluntary insurance market

Rate Making Standards

Rates may not be excessive or inadequate, nor unfairly discriminatory. Rates will not be considered excessive unless they are unreasonably high for the insurance provided and a reasonable degree of competition does NOT exist. Rates will not be considered inadequate unless they are unreasonably low for the insurance provided and continued use would endanger solvency of the insurer or their use tends to destroy competition or create a monopoly.

Churning

The illegal replacement practice of misrepresenting a policy to induce a policyholder to lapse, forfeit, or surrender an existing policy and purchase a new policy from the same insurer

25%

Unfair and Deceptive Practices - Controlled Business: No more than ____% of an agent's annual premium volume may be derived from insurance written on the agent's family, or employees of the agent