Mississippi Law
No insurer or agent may be permitted to attach a
"three-quarter value" clause to insurance of this kind, and to do so is a misdemeanor punishable by a fine between $200-$1,000 for each offense.
Anyone who willfully violates a cease and desist order will be subject to a fine up to
$1,000 for each violation, which must be used for the public schools in the county where the offense occurred.
In lieu of or in addition to the cease and desist order, the Commissioner may impose and administrative fine up to
$5,000 per violation, which must be deposited in the Insurance Department Fund
A licensee whose license has been revoked cannot be relicensed for at least
1 year from othe revocation's effective date or if judical review of the revocation is sought, 1 year from the date a court order or decree affirms the revocation
Whenever the Commissioner has reason to believe that any person has been engaged or is engaging in any unfair method of competition or any unfair or deceptive practice and that the public's best interest will be protected, he/she must issue:
1. A statement of the charges against that person. 2. A notice of hearing to be held within 10 days after the notice is served.
The Commissioner May:
1. Administer oaths, examine/cross-examine witnesses, receive oral and documentary evidence 2. Have the power to subpoena witnesses, compel their attendance 3. Require that all books, papers, records, correspondence, or other documents deemed relevant to the hearing be produced 4. And if requested, order a stenographic record of all evidence and proceedings 5. Apply to the Hind County Circuit Court to compel witness to comply with the his subpoena. Refusal to comply may be punishable as contempt to court 6. Designate and authorize others to serve statements of charges, notices, orders, and other processes on his behalf.
Rates cannot be excessive, inadequate or unfairly discriminatory. In determining whether rates comply with these rules, the following criteria will be considered
1. Past and prospective loss and expense experience within and outside of Mississippi 2. Catastrophe hazards 3. Any residual market loss redistributions and other similar obligations 4. Reasonable profit and contingency trends within and outside Mississippi 5. Loadings for: Leveling premium rates over reasonable period of time or dividends or savings to be allowed or returned by insurers to their policyholders
The Commissioner may, after notice and a hearing, revoke an insurer's license and authority to transact business in Mississippi, impose an administrative fine or both for the following reasons:
1. Violating or neglecting to comply with any provisions of law to which the insurer is obligated 2. The insurer is deemed financially unsound 3. The insurer's assets above its liabilities (exclusive of capital and inclusive of unearned premiums), are less than the amount of its original capital or required unimpaired funds 4. Failure to pay a court ordered judgment within 90 days. In such cases, an insurer cannot be relicensed for at least 3 years after the revocation and judgement must also be paid 5. Refusing to comply with any provision or requirements of Mississippi insurance laws. Such revocation will be effective 30 days after a notice of revocation has been mailed or notice has been served: If the insurer does not comply within those 30 days, its license will be revoked; the insurer may not be relicensed for a period of 1 year and until it fully complies with applicable provisions and requirements
The Commissioner may issue a temporary insurance producer license, without requiring an examination, for a period not to exceed
180 days in the following cases: *To the surviving spouse or court appointed personal representative of a licensed insurance producer who dies or becomes mentally or physically disabled to allow adequate time for the | sale of business | Recovery or return of the producer | Training and licensing of new personnel to operate the producers business * To member or employee of a business entity licensed as a insurance producer, upon the death or disability of an individual *To the designee of a licensed insurance producer entering active service in the armed forces of the United States ■ In any other circumstance where the Commissioner deems that the public interest will best be served by the issuance of this license
No foreign insurance company, association or other insurance entity, either stock, mutual, or reciprocal, may be admitted to do business or granted a certificate of authority or license to do business in this state unless it has done business for a period of
2 years in the state of its domicile or unless such company seeking admission is the subsidiary or affiliate of a company already licensed in Mississippi
For the purpose of grading fire departments, the alternative water supply standard shall be
250 gallons per minute for a sustained period of 1 hour.
A producer must report to the Commissioner any criminal prosecution against the producer within
30 days
Producers must notify the Commissioner within
30 days of any change of address. Failure to do so may result in a penalty
A producer must report to the Commissioner any administrative action taken against the producer in another jurisdiction or by another governmental agency in Mississippi within
30 days of the final deposition of the matter`
When the commissioner receives the notice of appointment he/she must verify within
30 days that the producer is eligible for appointment.
If the producer is deemed ineligible for appointment, the Commissioner must advise the insurer within
5 days of the determination
If the payment of policy obligations is suspended in substantial part for a period of
6 months at any time after the appointment of the rehabilitator and the rehabilitator has not filed an application for approval of the plan, the rehabilitator may petition the court for an order of liquidation on grounds of insolvency
Essential property insurance coverage shall be limited to
95% of the market value of real and personal property that is insured by the Association, excluding the value of land.
A life insurance company is any business entity conducting insurance transactions as its primary purpose for, and means of its existence. An insurance company can be:
A corporation An association A partnership An individual
Producer
A producer is a person required to be licensed under Mississippi laws to sell, solicit, or negotiate insurance
Any person having an insurable interest in insurable property is entitled to apply to the Association for covearge.
Applications may be made on behalf of the applicant by any licensed agent or broker on the forms prescribed by the Association. The Association may require an inspection of any properties after application or request for renewal and may charge an inspection fee
Coastal Areas
Coastal areas are Hancock, Harrison, and Jackson counties
The Commissioner has the power to
Examine and investigate the fairs of every person engaged in insurance transactions in Mississippi.
Coast Area
Hancock, Harrison, Jackson, Pearl River, Stone, and George Counties * This list has 3 counties (Pearl River, Stone and George) that are not included in the Mississippi Residential Property Underwriting Association's coast area.
The license must contain:
Licensee's name, address, personal identification number and the date of issuance, the lines of authority, the expiration date and any other information the commissioners deems necessary. Each license issued to a producer will expire on the mandated renewal date following the date of issue.
The Commissioner also may:
Limit the authority of any temporary licensee in any way deemed necessary to protect insureds and the public ■ Require the temporary licensee to have a suitable sponsor who is a licensed producer or insurer and who assumes responsibility for all acts of the temporary licensee and may impose other similar requirements designed to the public ■ Revoke a temporary license if the interests of insureds or the public are endangered. A temporary license may not continue after the owner or the personal representative disposes of the business
The association has now been renamed:
Mississippi Residential Property Insurance Underwriting Association, and expanded to provide a residual market for residential property insurance in both rural areas and other areas of the state.
The Commissioner must:
Notify the association of the existence of an insolvent insurer not later than 3 days after he/she receives notice of the determination of the insolvency ■ Upon request of the board of directors, provide the association with a statement of the net direct written premiums of each member insurer
All fire insurance companies organized or admitted to do business in the state of Mississippi must maintain a
Rating Bureau
The Commissioner may:
Require that the association notify the insureds of the insolvent insurer and any other interested parties of the determination of insolvency and of their rights under this article ■ Suspend or revoke, after notice and hearing, the certificate of authority to transact insurance in this state of any member insurer which fails to pay an assessment when due, or fails to comply with the plan of operation; as an alternative, the commissioner may levy a fine on any member insurer which fails to pay an assessment when due of up to 5% of the unpaid assessment per month, to be no less than $100 per month ■ Revoke the designation of any servicing facility if he/she finds claims are being handled unsatisfactorily
Rural Areas
Rural areas include all those areas of the state of Mississippi, which are designated as fire protection Class 9 or Class 10 by the Insurance department
Before issuing a license to a new producer,
The Commissioner will require the appointing insurer to verify that the appointee's background has been investigated to determine that he/she is of good moral character and is qualified and trustworthy to act as a producer.
Association
The Mississippi Residential Property Insurance Underwriting Association
Any documents, materials, or other information regarding a termination for cause in the Department of Insurance's control or possession is confidential by law and privileged. It is not subject to:
The Public Records Act Subpoena Discovery or admissible in evidence in any private civil action
Essential Property Insurance
This is insurance against direct loss to residential property as defined and limited in the standard fire policy with the extended coverage endorsement attached and with terms, limits, deductibles, endorsements and exclusions as approved by the Mississippi Insurance Commissioner
Insurable Property
This means residential builders risks and residential real property or it's contents, which is determined by the Association, after inspection, to be insurable. This does not include motor vehicles. Any one or two family dwelling, which includes manufactured homes, built in substantial accordance with local building codes, which is not otherwise rendered uninsurable by reason of use, occupancy, or state of repair, is an insurable risk. Neighborhood areas, location, and environmental hazards beyond the control of the applicant or property owner must not be considered in determining insurable condition.
Insurable Property
This real property and contents (when requested) at fixed locations in coastal areas, which the Associates has inspected and determined to be insurable.
A nonresident producer who moves from one state to another state or resident producer who moves from Mississippi to another state shall file
a change of address and provide certification from the new resident state within 30 days of changing legal residence. No fee or license application is required
To appoint a producer, an insurer must file
a notice of appointment with the Commissioner within 15 days from the date the agency contract becomes effective or the first insurance application is submitted.
If the Association determines that the property is insurable and that there are unpaid premium due to prior insurance on the property, the Association will issue
a policy of essential property insurance after receiving the premium payment. Coverage limits are determined by the property's value at the time the policy is issued, subject to any specified maximum limits.
Upon the Commissioner's written request, the insurer must provide
additional information, documents, records, or other data pertaining to the termination. This includes information discovered in any subsequent investigations that would have been reportable had the insurer known about it beforehand
Whenever a person has committed a violation which makes the continued operation of an insurer contrary to the interests of policyholders or the public, the commissioner may,
after giving notice and an opportunity to be heard, determine to suspend, revoke, or refuse to renew such insurer's license or certificates of authority to do business in this state or both for such period as he/she finds is required for the protection of policyholders or the public. Any such determination must be accompanied by specific findings of the fact and conclusions of law
No insurer may knowingly issue a fire insurance policy for
an amount that together with any existing insurance exceeds the property's fair value nor for a term longer than 5 years.
Insurance Adjuster
an independent contractor, or as an employee of independent contractor, adjustment bureau, association, insurance company or corporation, managing general agent, or self insured, investigates or adjusts losses on behalf of either an insurer or a self insured, or any person who supervises the handling of claims.
No foreign mutual or reciprocal insurance company or association will be admitted or granted a certificate of authority or license to do business in this state uness
at the time of licensing or renewal of license, its surplus must be equal to that required by the laws of this state for the organization or formation of a like domestic insurance company or association
Every insurer authorized to write property insurance on a direct basis in Mississippi is required to
be a member of the Association and to remain a member for as long as the Association remains in existence as a condition of its continued authority to transact insurance in this state.
Any person with possession or control of any
books, accounts, or papers of any licensee must exhibit them to the commissioner on demand
Any homeowner's insurance policy that offers a percentage deductible for the peril of windstorm must offer a
buy-back provision for that deductible which is actuarially sound. However, the Commissioner may grant a waiver from this requirement if certain criteria are met.
Every pool must file with the commissioner a copy of its
constitution, articles of association or incorporation, bylaws and any other rules or regulations governing its activities, a list of its members, the name and address of a resident of this stat upon whom notices or orders of the commissioner or process may be served, and any changes in the foregoing.
Every person who conduct or attempt to conduct any insurance transaction/solicitation without having proper licensure or not in accordance with the Insurance Code will be
deemed guilty of a misdemeanor and will be punishable by a fine of no more than $5,000 per violation
The term "alien" is used
for surplus lines insurers based in countries other than the U.S.
Unless a penalty for Mississippi Insurance code violation is specifically provided, the offender will be
guilty of a misdemeanor,, punishable by a fine for not more than $5,000
Rates may be modified for:
individual risks by rating plans or schedules which provide for variations in hazards, expenses, or both
The Mississippi Residential Property Underwriting Association is not required to
insure the risks of wind and hail storm in the coastal areas
No foreign stock insurance company will be admitted or granted a certificate of authority or license to do business in this state unless
its paid-up capital stock and its surplus at the time of licensing or renewal of license must be equal to that required for the organization or incorporation of a like domestic company under the laws of this state
Every individual seeking to renew an insurance producer license that has been in effect;
less than 18 months =12 hours of continuing education courses more than 18 months= 24 hours of continuing education courses (3 of which must be in ethics)
Within 15 days of notifying the Commissioner of the producer's termination, the insurer must
mail a copy of the notice to the producer at his/her last known address. If the producer was terminated for cause, the insurer must send the copy via certified mail, return receipt requested, postage prepaid, or by overnight delivery using a nationally recognized carrier.
Negotiate
means the act of conferring directly with or offering advice directly to a purchaser or prospective purchaser of a particular contract of insurance concerning any of the substantive benefits, terms or conditions of the contract, if the person engaged in that act either sells insurance or obtains insurance from the insurers for purchasers.
Solicit
means to attempting to sell insurance or asking or urging a person to apply for a particular kind of insurance from a particular company
Sell
means to exchange a contract of insurance by any means, for money or its equivalent, on behalf of an insurance company
Any residual market mechanism, plan or agreement
must be submitted in writing to the commissioner for approval, together with such information as the commissioner may reasonably require
An insurer or authorized representative of the insurer that terminates a producer's appointment, employment, or contract must
notify the Commissioner within 30 days following the effective date of termination
If the Commissioner nonrenews or denies an application for a license, he/she shall
notify the applicant or licensee and advise, in writing, of the reason for the license denial or nonrenewal. Written demand within 10 days for hearing. 30 day wait for hearing to be held.
A domestic insurer is
one that has been incorporated or formed in Mississippi.
Mississippi Rural Risk Underwriting Association
original purpose was to ensure an adequate residual property insurance market in Mississippi's rural areas, as the State Legislature declared that the current market in those areas was inadequate.
Whenever the Commissioner has reason to believe that any such...
person, company, corporation, or association has engaged in any improper or unauthorized activity in violation of any insurance law, the commissioner may issue a cease and desist order
The Windstorm Underwriting Association was created to
provide an adequate market for wind and hail coverage throughout Mississippi's coastal areas. Rather than "member" insurers, the Association has "assessable" insurers.
These guidelines must be
published and made available to each municipality and fire district not later than January 30 of the calendar year during which the Rating Bureau will apply the guidelines.
Insurers participating in joint underwriting, pools or residual market mechanisms may act in cooperation with each other in making of
rates, supplementary rate information, policy forms, underwriting rules, surveys, inspections and investigations, the furnishing of loss or expense statistics or other such information and in the conduct of research in connection with such activity.
Within 30 days of receiving the copy of the termination notice, the producer may file
rebuttal comments with the Commissioner regarding the termination. If he/she does, a copy must also be provided to the reporting insurer.
The Mississippi Insurance Codes uses the term "Foreign" insurer to
refer to all those formed outside of Mississippi
If any statements made by any licensee are found to be untrue, the commissioner may
revoke and cancel the license.
Before granting a certificate of authority to any insurance company organized under the laws of another state or government, the commissioner must be
satisfied that it is qualified to transact business under the laws of the state in which it has its principal office, and also as to its financial ability and condition.
If a cease and desist order is issued without notice and a hearing, the order must
specify that the respondent may request a shearing for reconsideration within 20 days of the date of the order
The Bureau will be composed of
state residents skilled in fire insurance rating, fire hazard evaluation, fire protection engineering, and fire insurance inspection
No foreign stock, mutual, or reciprocal insurance company or association, incorporated or organized under the laws of any state of the United States, may be admitted to do business, or granted a certificate of authority, or have license therfor renewed until
such company must have deposited with the State Treasurer of this state securities in an amount not less than $50,000.
In addition to or in lieu of a fine,
the Commissioner may revoke or suspend the person's license. Such suspension or revocation can be appealed in the circuit court of Hinds County
The Commissioner also may require
the insurer to obtain a credit report on a producer
The purpose of the Association is
to provide a mechanism for the payment of covered claims under certain insurance policies to: |Avoid excessive delay in payment | Avoid financial loss to claimants or policyholders because of the insurer's insolvency (when an insurer doesn't have the funds to pay a claim) |Assist in the detection and prevention of insurer insolvencies; and | provide an association to assess the cost of such protection among insurers
The Commissioner of Insurance may make use of any of the powers established ....
under the insurance laws and regulations of this state to establish a nonbinding, nonadversarial alternative dispute resolution procedure for the effective, fair, and timely handling of personal lines insurance claims.
If, after a hearing, the commissioner finds that any activity or practice of insurers participating in joint underwriting, pool, or residual market mechanisms is unfair, unreasonable, or otherwise inconsistent with the provisions of this chapter, the commissioner may issue a written order specifying in
what respects such activity or practice is unfair, unreasonable or otherwise inconsistent with the provisions of this chapter and require the discontinuance of such activity or practice
This does not include:
| An attorney who adjust insurance losses only from time to time and who does not advertise or represent that he or she is an adjuster | A salaried employee of an insurer who is regularly engaged in the adjustment, investigation or supervision of insurance claims | Persons employed only for the purpose of furnishing technical assistance to a licensed adjuster, including, but not limited to, photographers, estimators, private detectives, engineers, handwriting experts and attorneys | A licensed agent or general agent of an authorized insurer who processes undisputed losses for the insurer under policies issued by the licensed agent or general agent | A person who performs clerical duties with no negotiations with the parties on disputed claims | Any person who handles claims arising under life, accident, and health insurance policies
Insurable Property
| Any one or tow family dwelling built, rebuilt, altered or remolded in compliance with applicable building codes (including the design-wind requirements) that is not otherwise rendered uninsurable by reason of use, occupancy, or state of repair, is an insurable risk | neighborhood, area, location, and environmental hazards beyond the applicant's or property owner's control must not be considered in determining insurable condition | Insurable property includes mobile homes, modular homes or manufactured housing installed in compliance with applicable codes | Insurable property does not include insurance on motor vehicles or creditor-placed insurance on mobile homes
Assess member insurers the amounts necessary to pay the claim obligations, the expenses of handling covered claims, and the cost of examinations
| The assessments of each member insurer are proportional to the insurer's net written premiums for the preceding calendar year | No member insurer may be assessed in any year an amount greater than 1% of its nets premiums for the preceding calendar year | Investigate, adjust, compromise, settle, and pay covered claims to the extent of its obligation
Unless otherwise denied licensure, a nonresident person may receive a nonresident producer license if:
| The person is currently licensed as a resident and is in good standing in his home state | The person has submitted the proper request for licensure and has paid the fees required | The person has submitted to the Commissioner the application for licensure that the person submitted to his home state, or a completed uniform application | The person's home state awards nonresident producer licenses to residents of this state on the same basis
The Association, with respect to essential property insurance, has the power:
| To issue policies of essential property insurance to applicants | At it's option and with the Commissioner's consent, issue policies of related essential property insurance | To purchase reinsurance for all or part of the Association's risks |To levy and collect regular assessments form assessable insurers; and | to take any other actions necessary to carry out its plan of operation
The Association will pay
|Covered to claims existing prior to the determination of insolvency and arising within 30 days after insolvency is determined; or | Claims existing before the policy expiration date if less than 30 days after the determination, or before the insured replaces/cancels the policy he/she does so within 30 days of the determination |The full amount of a covered claim for benefits under a Workers' Compensation insurance coverage | Not less than $50 per policy for a covered claim for the return of unearned premium | $50-$300,000 per claimant for all other covered claims
An insurance transaction includes any of the following actions within the context of an insurance contract:
|Soliciting |Selling |Advertising |Taking or transmitting applications |Receiving or delivering policies Receiving, paying, collecting or transmitting a premium |Any other act involved in making or consummating an insurance contract
The Commissioner may place on probation, suspend, revoke, or refuse to issue or renew an insurance producer's license or levy a civil penalty in an amount not to exceed $1,000 per violation, for any one or more of the following causes:
■ Providing incorrect, misleading, incomplete, or materially untrue information in the license application ■ Violating any insurance laws, or violating any regulation, subpoena, or order of the Commissioner or of another state's commissioner ■ Obtaining or attempting to obtain a license through misrepresentation or fraud ■ Improperly withholding, misappropriating, or converting any monies or properties received in the course of doing insurance business ■ Intentionally misrepresenting the terms of an actual or proposed insurance contract or application for insurance ■ Having been convicted of a felony ■ Having admitted or been found to have committed any insurance unfair trade practice or fraud ■ Using fraudulent, coercive, or dishonest practices or demonstrating incompetence, untrustworthiness, or financial irresponsibility in the conduct of business in this state or elsewhere ■ Having an insurance producer license or its equivalent denied, suspended, or revoked in any other state, province, district, or territory ■ Forging another's name to an application for insurance or to any document related to an insurance transaction ■ Improperly using notes or any other reference material to complete an examination for an insurance license■ Knowingly accepting insurance business from an individual who is not licensed ■ Failing to comply with an administrative or court order imposing a child support obligation ■ Failing to pay state income tax or comply with any administrative or court order directing payment of state income tax