State Laws & Regulations- GA P&C Exam Prep
Risks Insurable- In State
"A risk is deemed to have a situs in Georgia if the insurance regards property having a permanent situs in Georgia or movable property which is actually in Georgia or is principally used or kept in Georgia or on persons who are Georgia residents."
Adjuster Conflict of Interest
An adjuster licensed as both an Independent Adjuster and a Public Adjuster cannot represent both the Insurer and the Insured in the same transaction.
Surplus Lines (Excess Lines) Broker
Surplus Lines insurance is insurance placed with an unauthorized Insurer when similar insurance is unavailable through any authorized Insurer. A licensed resident property, casualty and surety agent may become licensed as a Surplus Lines Broker but must post a $50,000 bond. A Surplus Lines agent is not required to be appointed (no need for a Certificate of Authority).
Individual Work Comp Insurer Rate Filing
Work Comp Insurers are required to file individual company rates for the voluntary market, thus establishing competitive rates for purchasers of Work Comp insurance in Georgia.
Any person who violates the Commissioner's cease and desist order is subject to......
a monetary penalty of up $10,000 for each violation.
What must the person being examined at the direction of the Commissioner pay?
the Insurer must pay all the actual expenses of the examination beyond the cost of regular Department employees.
The LH Guaranty Association will pay up to:
• An unlimited amount for a work comp claim; • $5 million in benefits for any one annuity holder; • $100,000 cash value on a life policy; • $300,000 death benefit on a life policy; and • $300,000 benefits for a health policy.
Any action of the Commissioner may be appealed within _____ days to __________ of _________ County.
30 days The Superior Court of Fulton County.
The Commissioner of Insurance is elected for a _____ year term.
4
Licensees must keep complete records at the office or the Insurer's office for at least ___ years.
5
Driver Not at Fault
An insurer cannot raise the rates of an individual involved in a multi-vehicle accident when the individual was not at fault.
How may a nonresident agent who moves to Georgia obtain a Georgia resident agent license without taking the exam?
By applying for a resident license within 90 days of establishing residence in Georgia
Medical Malpractice Notice
Every Medical Malpractice Insurer must within 30 days notify the Composite State Board of Medical Examiners when it pays a judgment or settles a medical malpractice claim.
What must the Commissioner pay to the Office of Treasury and Fiscal Services?
all taxes, fees, charges, and penalties and interest collected So it can be deposited to the State general fund.
Any cease and desist order from the Commissioner must.....
• Be written and signed; • State its effective date and purpose; • Be delivered to the person to be ordered by mailing it to the person's principal place of business or last address of record in the Commissioner's office.
The Commissioner is required to examine who and how often?
• Domestic Insurers at least once every 3 years; and • Rating organizations at least once each 5 years.
"Controlled business" means property or casualty insurance sold:
• For an agent or agent's spouse; • For an agent's relative by blood or marriage within the second degree of kinship; • For a person's employer or the firm of which an agent is a member; • For any officer, director, stockholder, or member of an agent's employer or of any firm of which an agent is a partner; • For any spouse of the officer, director, employer, stockholder, or member of the agent's firm; • For an agent's ward or employee; or • For any person or in regard to any property under an agent's control or supervision in any fiduciary capacity.
A license may be refused, suspended or revoked by the Commissioner due to:
• Fraudulent or dishonest practices; • Holding a license for the purpose of securing rebates or commissions (controlled business); • Lack of trustworthiness or competence; • Knowingly over-insuring a risk; • Failure to report to the Commissioner any criminal activity within 30 days of the date of arrest; • Failure to report to the Commissioner any license suspension or revocation in another jurisdiction within 60 days; or • Failure to pay ordered child support.
A Nonresident license will be issued to a person who: Is their a countersign requirement?
• Is currently licensed as a resident and in good standing in such person's home state; • Is a resident of a state that will reciprocate by licensing Georgia agents; and • Consents to receiving notice of lawsuits by having the notice served upon the Commissioner. Georgia does not require policies issued by Nonresident Agents to be countersigned by Resident Agents.
However, it not considered to be an illegal rebate for an Insurer to:
• Pay policy dividends based on insurance company profits; • Give discounts for group policies; • Give discounts for payroll or checking account deductions; or • Pay for a client's business meals, refreshments, and entertainment.
The following do not need to be licensed to adjust claims in Georgia:
• Persons who adjust life insurance, marine insurance, or annuities; or • Salaried employees of Insurers who adjust claims under policies issued by the Insurer.
If an Insurer, agent, broker, counselor, or adjuster has violated a statute, regulation, or order, the Commissioner may:
• Place the person on probation for up to 1 year for each violation; • Suspend or revoke the person's license; • Issue a monetary penalty of up to $1,000 for each unintentional violation; and • Issue a monetary penalty of up to $5,000 for each intentional (knew or should have known) violation.
For Property and Casualty insurance, the state has created the Georgia Insurers Insolvency pool to cover
• Property or Casualty claims over $50 up to $300,000; and • Work comp claims regardless of amount It is illegal to advertise the existence of the Insurers Insolvency pool for the purpose of inducing the purchase of insurance.
A Public Adjuster:
• Represents the interests of the Insured; • Must be bonded; • Cannot accept payment from a lawyer for recommending that lawyer; and • Cannot recommend a particular attorney.
"Transacting insurance" includes
• Solicitation and inducement; • Preliminary negotiations; • Effectuation of a contract of insurance; and • Transaction of matters subsequent to effectuation of the contract and arising out of it.
Although an Agent cannot usually collect from the client any additional fee beyond the amount of the premium, it is permissible for an Agent to collect:
• a de minims payment from the client not to exceed $45; • a medical exam fee from a Life or Accident and Sickness policy applicant; and • on an unpaid premium 30 days past due, a minimum service charge of $1 per month, not to exceed 15¢ per $10 per month (1 ½ % per month, 18% per year)
An applicant for a resident agent's license must:
An applicant for a resident agent's license must: • Be 18 years of age; • Be of good character; • Reside in and be present within Georgia for at least 6 months every year; • Complete the required pre-licensing education; • Pass the licensing exam; and • Be appointed as an agent by an authorized Insurer.
'Business entity' or "agency" means.... What must each principal office and branch office obtain? A person with a refused, suspended, or revoked license cannot do what? An Insurer may pay a commission to a licensed insurance agency if what?
'Business entity' or "agency" means a corporation, association, partnership, sole proprietorship, limited liability company, limited liability partnership, or other legal entity licensed to sell insurance." Each principal office and each branch office of an agency must obtain an agency license. A person with a refused, suspended, or revoked license cannot own 10% or more of an agency. An Insurer may pay a commission to a licensed insurance agency if all persons who sell insurance are licensed agents.
Authorized (Admitted) Insurers: What must they obtain to be "admitted"? How much does an Insurer have to have in capital to qualify? What must Insurers file with the Commissioner?
-A Certificate of Authority to be "admitted" to transact insurance in Georgia -An Insurer must have at least $1.5 million in capital to qualify for a Certificate of Authority -Insurers must file a detailed annual report with the Commissioner.
A 'Limited license' may be used to sell: What are their licensing requirements? rental car company?
A 'Limited license' may be used to sell: • Rental car insurance policies not to exceed 90 days; • Credit insurance; and • Insurance on communications equipment (such as cell phones). Limited license agents are not required to pass the licensing exam. Each car rental company must provide its limited license rental car agents with a training program plus 2 hours of annual continuing education. Limited licensee rental car agents cannot advertise or hold themselves out as insurance agents. Vendors of cell phones and other similar communications equipment may obtain a limited license for the purpose of selling insurance policies covering theft, loss, or malfunction of the items sold. Credit Insurers must certify that their licensees have completed a minimum of 5 hours of self-study in credit insurance subjects prior to licensure.
An agent may only share (split) commissions with who?
An agent may only share (split) commissions with an agent having the same type of license (life with life, property with property, etc.).
How is an insurance paid? What fees can they accept from a client?
An insurance agent is generally paid only by the Insurer; so an agent cannot accept additional fees from the client, unless the compensation has a de minims value of $45 or less.
Agents May From Time-to-Time Adjust claims
If so authorized by the Insurer, an Agent may from time-to-time adjust claims without being licensed as an adjuster.
Defensive Driver Course Discount
Insurers must offer a premium reduction of at least 10% on personal auto policies for liability, med pay, and collision coverages (not Comprehensive) if the named drivers: • Have had no traffic offenses for the prior 3 years; • Have had no fault-based claims for the prior 3 years; and • Are 25 or older and have completed an approved 6 hour defensive driving course. To continue eligibility for the discount, the Insured must repeat the Defensive Driver course every 3 years and have no traffic offenses or at fault claims. For drivers under 25, an approved new driver preparatory course (30 hours classroom and 6 hours practical training) substitutes for the Defensive Driver course.
What must the insurer obtain to appoint each agent? What will be assumed of the insurer when they submit the appointment request to the commissioner? How often must these be renewed? How many days does the insurer have to notify the commissioner and agent after the agent's termination? What specific termination reason does the commissioner need to be notified about in that time period?
The Insurer must obtain a Certificate of Authority for each agent. The Insurer will be deemed to have obtained a Certificate of Authority immediately upon submission of the appointment request to the Commissioner. The Certificates of Authority must be renewed by the Insurer annually. The Insurer must notify the Commissioner and the agent within 30 days after the agent's termination. If the termination involves the agent's lack of moral character, the Insurer must so notify the Commissioner with the 30 day time limit.
Workers Compensation Assigned Risk Insurance Plan
The State Board of Workers Compensation may equitably assign rejected work comp policies to work comp Insurers if an applicant has been rejected by 4 Insurers. (Review) A work comp nonrenewal or cancellation must be sent at least 75 days in advance. (Review) A work comp Insurer must provide at least a 7½ % premium reduction if the employer has been certified by the State Board of Workers Compensation as having a drug-free workplace program
What is an 'Independent Adjuster'
an adjuster representing the interests of the Insurer.
The notice of nonrenewal of an auto policy must include one of the following:
"NONRENEWAL NOTICE: Code Section 33-24-45 of the Official Code of Georgia Annotated provides that this Insurer must, upon request, furnish you with the reasons for the failure to renew this policy. If you wish to assert that the nonrenewal is unlawful, you must file a written notice with this Insurer before the time at which the nonrenewal becomes effective. The notice must specify the manner in which the failure to renew is alleged to be unlawful. If you do not file the written notice, you may not later assert a claim or action against this Insurer based upon an unlawful nonrenewal." "NONRENEWAL NOTICE DUE TO AGENT TERMINATION: Your policy has not been renewed because your present agent no longer represents this Insurer. You have the option of procuring coverage through your present agent or retaining this policy by applying through another agent of this Insurer. Code Section 33-24-45 of the Official Code of Georgia Annotated provides that if you will locate another agent of this Insurer and apply for this policy before the time at which the nonrenewal becomes effective, this Insurer will treat the application as a renewal and not as an application for a new policy."
Residential Nonrenewal
A residential policy cannot be nonrenewed for: • "Lack of, lack of potential for, or failure to agree to a writing of supporting insurance business;" • A change in the Insurer's eligibility rules; or • Two or fewer claims against the policy within the preceding 36 month period if such claims are not attributable to the negligent or intentional acts of the Insured or of persons residing at the Insured premises (must have 3 or more "no fault" claims in the last 3 years). A residential nonrenewal notice must state one of the following:: "RESIDENTIAL NONRENEWAL NOTICE: This Insurer must, upon request, furnish you with the reasons for the failure to renew this policy. If you wish to assert that the nonrenewal is unlawful, you must file a written notice with this Insurer before the time at which the nonrenewal becomes effective. The notice must specify the manner in which the failure to renew is alleged to be unlawful. "RESIDENTIAL NONRENEWAL NOTICE IF THE PRODUCER IS TERMINATED: Your policy has not been renewed because your present agent no longer represents this Insurer. You have the option of procuring coverage through your present agent or retaining this policy by applying through another agent of this Insurer. Georgia statute provides that if you will locate another agent of the Insurer and apply for this policy before the time at which the nonrenewal becomes effective, this Insurer will treat the application as a renewal and not as an application for a new policy."
When do individual license expiration dates occur? When is the renewal term? What must be done to renew?
According to the legislature, individual license expiration dates occur on the last day of the licensee's birth month. The renewal term for all licenses will be for two (2) years. Therefore each applicant for renewal will be required to pay a two- year renewal fee. (Updated: Previously December 31st of each year.)
Residential Cancellation
After a residential policy has been in effect more than 60 days, the policy may be cancelled only for the following reasons: • Nonpayment of premium; • Fraud or misrepresentation; • A substantial increase in the risk; or • Violation of the policy terms or conditions. When a policy is nonrenewed or canceled other than for nonpayment of premium, the Insurer must notify the Insured of the possible eligibility for coverage through the Georgia Fair Access to Insurance Requirements (FAIR) Plan. The notice must include the address for the Georgia FAIR Plan.
Types of Insurers An Alien Insurer A 'Foreign' Insurer A 'Domestic' Insurer A 'Mutual Insurer' A 'Stock Insurer'
An Alien Insurer is an Insurer formed under the laws of another country. A 'Foreign' Insurer is an Insurer formed under the laws of another state. A 'Domestic' Insurer is an Insurer formed under the laws of Georgia. A 'Mutual Insurer' is an Insurer without stock or shares but which is owned and governed by its policyholders. A 'Stock Insurer' is Insurer with stock or shares and which is owned and governed by its shareholders.
Can agents sign Blank Policies?
An agent must not sign in blank any policy to be issued outside of such agent's office.
Rebating
Because Property and Casualty premium rates are filed with the Commissioner, it is illegal for an Insurer to give a rebate, reduction, or discount in premiums as an inducement to purchase insurance. It is, however, permissible for an Insurer to provide food and refreshments for current or prospective clients during sales presentations, provided that no insurance policies are offered during the presentations.
Binders
Binders for temporary insurance may be made orally or in writing and will be deemed to include all the usual terms of the policy as to which the binder was given together with any applicable endorsements that are designated in the binder. No binder will be valid beyond the issuance of the policy with respect to which it was given or beyond 90 days from its effective date, whichever period is the shorter.
Notice Required of Termination or Nonrenewal Due to an Increase in Premium Rates or a Change Restricting Coverage
Each Property Insurer must give 45 days' written notice if nonrenewal is due to: • A premium increase of 15 percent or more; or • A policy change which limits coverage. Failure of an Insurer to comply with this section entitles the Insured to purchase, under the same premiums and policy terms and conditions, an additional 30 day period of insurance coverage. A work comp nonrenewal or cancellation must be sent at least 75 days in advance.
Disclosure Requests From Plaintiffs' Attorneys
Every Insured must, within 30 days of request from a claimant or the claimant's attorney, disclose the name of each known Insurer which may be liable upon the claim. Every liability Insurer must provide, within 60 days of request from the claimant, a statement under oath regarding each relevant liability policy, including the name of the Insurer, the name of each insured, and the limits of coverage.
Workers Compensation
Georgia is a "private insurer" state - the state government does not sell work comp insurance. Employers must either "self-insure" or obtain work comp insurance from a private insurance company. Work Comp in Georgia is generally compulsory if an employer has 3 or more regular employees (full or part-time). Work comp coverage is optional for: • Businesses with fewer than 3 employees • Sole proprietors and partners; • Up to 5 corporate officers; • Railroad workers; • Farm laborers; • Domestic servants; and • Real estate salespersons and brokers.
Illegal Policies Still Valid
If an insurance policy is sold in violation of Georgia law (such as through an unauthorized Insurer), the policy will still provide valid coverage.
No Premium Increase for Public Officials
If any of the following are involved in a motor vehicle accident while performing official duties, an Insurer cannot use that accident as the basis for increasing the premium on the individual's personal motor vehicle: • Law enforcement officer; • Firefighter; or • Emergency medical technician.
How must Subpoenas be served? What if the individual fails to obey the subpoena?
In the same manner as if issued by a superior court. If any individual fails to obey a subpoena, the Commissioner may request that the superior court of the county (in which the proceeding is pending) issue an order requiring such individual to comply with the subpoena.
The Commissioner may issue a Probationary License to who and for how long?
The Commissioner may issue a Probationary License to any applicant for a period of not less than 3 months but not longer than 12 months, subject to immediate revocation for cause at any time without a hearing.
Grouping of Risks May be Illegal in Residential Insurance Transactions
Unless actuarially supported, the following "grouping of risks" will be deemed unfair race, creed, or ethnic extraction discrimination if an applicant's acceptability for residential insurance is based on: • The age of the dwelling without giving proper consideration for updated mechanical and structural systems; or The applicant's: • Marital status or the marital status of anyone in the household; • Length of time at an address; • Employment or occupational status; • Length of employment; • Level of education; ] • Willingness to purchase other insurance not requested by the applicant; or • Military status.
A person with a suspended license may...
still receive previously earned commissions and renewal commissions.
An auto policy may be cancelled for the following regardless of when the event occurred:
• Failure to pay premiums; • Material misrepresentation; • Violation of the terms of the policy; • Epilepsy or heart attacks if the individual does not produce a certificate from a physician testifying to his unqualified ability to operate a motor vehicle; • Operating a motor vehicle which is so mechanically defective that it is dangerous; or • Operating a private motor vehicle to carry persons for hire (other than a car pool).
All premiums and return premiums received by a licensee:
All premiums and return premiums received by a licensee: • Must be accounted for in the licensee´s fiduciary capacity; • Cannot not be commingled with the licensee´s personal funds, and Must be promptly paid to the: • Insurer if a premium; • Insured if a return premium (within 10 days); or • Agent if a commission. The licensee may utilize a single fiduciary (trust, escrow) bank account for the premium trust account.
With respect to an examination, investigation, or hearing, the Commissioner may......
take depositions, subpoena witnesses, administer oaths or affirmations, examine any individual under oath, and compel the production of records, books, papers, and other documents.
Honor Student Discount
Drivers under age 25 may also receive an "appropriate" rate reduction approved by the Commissioner if the driver is: • Unmarried and enrolled as a full-time student (high school, college, or vo-tech); and • An honor student (has a B or 3.0 grade average, OR is the top 20% of the class, OR is on the Dean's list, OR is on the Honor Roll. Proof of "honor student" status must be provided to the Insurer annually. An Insurer may drop the "honor student" discount for any of the following during the prior 3 years: • An at-fault accident; • Any serious traffic offense; • Any drug offenses; or • Refusal to submit to chemical testing in a driving situation.
Regulation of Premium Rates
Insurance companies and the various state insurance commissioners may legally engage in limited price-fixing under the Federal McCarran-Ferguson Act of 1945 (not a test term), although collusion between insurance companies is still prohibited. The Commissioner and insurance companies may legally engage in limited "price fixing" of premium rates by: • Using rating organizations to set premiums; and • Regulating insurance rates so that they are not excessive, inadequate, or unfairly discriminatory. The rules regulating insurance rates apply to property insurance, casualty insurance, and health insurance but generally do not apply to: • Life insurance policies, disability income, specified disease, or hospital indemnity policies; • Work Comp insurance; • Ocean Marine insurance; • Aircraft insurance; • Title insurance; or • Annuities. "Discriminatory rates" are those that are different for persons of approximately the same rate and hazard classification. "Excessive rates" are those that are unreasonably high. "Inadequate rates" are those which: • Are unreasonable low; • Endanger the solvency of the Insurer; or • Tend to destroy competition or create a monopoly.
Who must the Commissioner inform when any criminal violation of insurance laws may have occurred? How may the commissioner enforce any of their order?
must inform the prosecuting attorney in whose circuit or jurisdiction any criminal violation of the insurance laws may have occurred. The Commissioner may bring legal action in the appropriate superior court to enforce any order of the Commissioner.
The following are Unfair Trade Practices:
• Paying an unlicensed person for a lead or referral; • Misleading advertising; • Guaranteeing life insurance policy dividends; • Defamation - a false or maliciously critical misrepresentation of an Insurer's financial condition; • Agreeing to boycott an Insurer or client; • Issuing stock as an inducement to buy insurance; • Unfair discrimination - using different rates for persons of approximately the same rate and hazard classification; • Discrimination based on race, color, mental impairment, physical impairment, total or partial blindness; national origin, ethnic origin, or other factors which have or may be covered by Georgia law; • Discriminating on the basis of family violence; • Disclosing that the applicant may have been the victim of family violence (with very detailed permitted exceptions); • Requiring credit insurance to be purchased from a particular Insurer; • Giving free or discounted insurance as an inducement to purchase real or personal property; • Giving a discount for property or casualty insurance based on membership in a particular organization; • Failing to disclose the cost of insurance when the insurance is included in the cost of purchasing real or personal property; • Using aftermarket crash parts to repair a client's auto without adequate notice in the repair estimate; and • Paying to a client rebates, such as premium rebates or special favors or advantages not specified in the policy.
Rate Deviation Requests
An Insurer may use a rate which is in higher or lower than the rate filed with the Commissioner if a "Rate Deviation" request and the policy are filed in advance with the Commissioner. However, if the resulting Rate Deviation request exceeds $1,000, a temporary binder may be issued as long as the Insurer files the Rate Deviation and policy with the Commissioner within 20 days. The Commissioner will then either approve or reject the Rate Deviation request.
What can an agent NOT do in terms of controlled business?
An agent cannot use an insurance license to obtain a rebate or commission on "controlled business," and must not in any calendar year effect controlled business that will aggregate as much as 25 percent of the volume of insurance sold by such applicant during such year, as measured by the comparative amounts of premiums.
Fair Plan - The "Residual Market"
All Property Insurers are required to participate in the creation of: • a Fair Access to Insurance Requirements (FAIR) Plan; and • an underwriting association to provide proportional assessments against Insurers to pay for the FAIR Plan's expenses and losses. Insurers share FAIR Plan expenses and losses in the same proportion as their premiums bear to the aggregate premiums written by all property Insurers in the state. The Georgia FAIR Plan is administered by the Georgia Underwriting Association (GUA). For residential (habitational) properties, the GUA/Fair Plan policy may provide coverage for: • Standard Dwelling Policy with optional extended coverage; • Coverage for only wind and hail; • Section II liability coverage; and • Coverage for burglary and robbery. For commercial property, the Fair Plan may cover: • Commercial property policies; and • Builders' Risk policies. The FAIR Plan will inspect an applicant's property and may decline to insure the risk. However, a risk cannot be declined due to the neighborhood or any environmental hazards beyond the control of the applicant. Although an agent has no authority to issue FAIR Plan binders, an applicant may request that the FAIR Plan issue a temporary binder if not notified of acceptance or rejection within 20 days after applying for coverage. FAIR Plan coverage is limited to: • $2 million per structure for either habitational or commercial risks; • $20 million per complex or interrelated set of buildings; • $10,000 habitational burglary and robbery; • $15,000 commercial burglary and robbery; and • Section II habitational liability - $100,000 per occurrence and $1,000 med pay. Any nonrenewal or cancellation of a policy in the normal market must provide in its 30 days notice that the FAIR Plan may provide residual market coverage (30 days to apply to FAIR Plan). This 30 days coverage notice does not apply if the nonrenewal or cancellation is due to nonpayment of premium or arson.
Georgia Motor Vehicle Reparations Act
An owner of a motor vehicle required to be registered in Georgia must provide liability coverage under the "Motor Vehicle Safety Reparations Act" in at least the amount of: • $25,000 bodily injury liability per Person; • $50,000 bodily injury liability per Accident; and • $25,000 property damage liability per Accident. Proof of Motor Vehicle Safety Responsibility may be given by: • A written certificate of insurance (liability insurance); • A surety bond; or • A certificate of self-insurance from the Commissioner of Insurance who will require annual financial statements audited by an independent certified public accountant. "Coverage must apply to the named insured, resident spouse, and any resident relative while occupying the covered motor vehicle, and to any other person legally occupying a covered motor vehicle." (Interstate Compact) Upon notice that a resident's driving privileges have been suspended in another state for failure to deposit security for the payment of judgments arising out of a motor vehicle accident causing bodily injury or property damage of $500 or more, the Department of Driver Services must suspend the license of such resident until such resident furnishes evidence of his or her compliance with the laws of such other state. Whenever any person is convicted of any offense resulting in a mandatory suspension of person's driver's license, the Department of Driver Services cannot reinstate the license unless the person obtains a Certification of Future Insurance. Any Insurer filing a Certification of Future Insurance with the Department of Driver Services cannot cancel the certificate within 12 months except for a another conviction of an offense requiring the mandatory suspension of driver's license. The Insurer must give the Department of Driver Services 20 days' prior written notice of cancellation.
The Commissioner may hold hearings for any purpose deemed necessary. But when MUST they hold hearings?
The Commissioner must hold a hearing upon the written demand of any person aggrieved by the Commissioner's act, threatened act, or failure to act.
The Commissioner requires how many hours of continuing Education per year? What if the person only receives renewal or deferred commission?
The Commissioner requires: • 15 hours of Continuing Education (CE) per year for most licensees; but • only 10 hours of CE per year for a person who has been licensed for 20 years or more. A person who has been a licensed agent for 10 years who only receives renewal or deferred commissions is exempt from: • Having a Certificate of Authority (appointment) and • Completing the annual 15 hours of Continuing Education.
The following are not deemed to be insurance agents and thus don't need to be licensed in Georgia:
The following are not deemed to be insurance agents and thus don't need to be licensed in Georgia: • An Insurer; • An attorney at law advising clients; • A representative of an Ocean Marine Insurer; • A representative of a farmer's mutual fire insurance company; • An employee of a consumer reporting firm; • A person working for a collection agency; • A payroll clerk making employee salary deductions for premiums under a group insurance policy; • Underwriters; • Agency sales managers who supervise agents; • Insurance advertising firms; and • An out-of-state agent who sells commercial property or casualty insurance to a business with operations in more than one state.
'Counselor' means.... What is the requirements for an applicant for a counselor's license? If Counselor is also licensed as an agent, the Counselor may accept a commission for selling insurance to the client as well as a fee for being a Counselor if the Counselor has:
'Counselor' means any person who engages in the business of counseling, advising, or rendering opinions as to the benefits, values, advantages, or disadvantages of a particular insurance policy, other than an actuary or consultant advising Insurers. • When receiving a fee, commission, or other compensation for this service, a counselor must not receive any compensation from any other source for the same transaction. An applicant for a counselor's license must be bonded and have had 5 years' experience in some phase of the insurance business or have sufficient teaching or educational qualifications or experience. If Counselor is also licensed as an agent, the Counselor may accept a commission for selling insurance to the client as well as a fee for being a Counselor if the Counselor has: • Obtained the client's written consent; and • Disclosed to the client the amount of the commission to be received from the Insurer.
Drug-Free Workplace Discount
A work comp Insurer must provide at least a 7½ % premium reduction if the employer has been certified by the State Board of Workers Compensation as having a drug-free workplace program.
Nonrenewal or Cancellation of Property or Casualty Policies
An Insurer may cancel with only 10 days written notice if the cancellation involves: • Nonpayment of premium; or • A policy that has been in effect for less than 60 days (it may be cancelled without having a reason). If the Insurer nonrenews or cancels, each nonrenewal or cancellation notice must provide: • 30 days written notice stating the reason for the nonrenewal or cancellation; or • Notice that the Insured may request the reason for nonrenewal or cancellation; and • Notice of the opportunity within 15 days to request that the Commissioner review the legality of the nonrenewal or cancellation (if the Insured has tendered a 30 day pro rata portion of the premium to the Insurer to provide "interim" coverage). If the appeal of the nonrenewal or cancellation is: • upheld by the Commissioner, the Insurer must refund the excess portion of the tendered 30-day premium; or • NOT upheld by the Commissioner, the Insurer must reinstate the policy. Any Insurer failing to return an unearned premium within 10 days must pay a penalty of 25% plus interest of 18% per year.
What does a 'Subagent' mean? What must they each obtain? What will this cover? What do they NOT have the power to do? How is the subagent required transact business? What is their licensing requirement?
An agent or producer who acts for another licensed agent in selling insurance and who has on file with the Commissioner a Certificate of Authority from each agent with whom the subagent places insurance. The Subagent does not act on behalf of the Insurer. Each agent must obtain a Certificate of Authority (appointment) for each subagent. A subagent's Certificate of Authority (appointment) may only cover the same kind of insurance for which the sponsoring agent is licensed. A subagent does not have power to issue binders. Insurance business transacted by a subagent must be in the name of the agent who will be responsible for all acts or omissions of the subagent. Subagents are not required to pass the insurance licensing exam - just complete a 20-hour pre- licensing course.
Why would an agent's license be placed on inactive status? What happens after 2 years? What must they comply with?
An agent's license will be placed on inactive status when the agent no longer has on file with the Commissioner a certificate of authority to represent at least one Insurer. If the license has been inactive for 2 consecutive years, the license may be revoked without notice or hearing. A person with an inactive license must comply with the Continuing Education requirements.
Who can an Insurer NOT pay commissions to? Is it legal for them to accept them?
An insurer cannot pay commissions or any other valuable consideration to an unlicensed person for referrals. It is also illegal for an unlicensed person to accept such a referral fee.
Reciprocal State Fees
If any other state or country charges Georgia Insurers or agents taxes or fees beyond those charged by Georgia, the Commissioner will automatically impose those fees against Foreign Insurers and nonresident agents from those states or countries. Readable Policies The following policies must be written in a simplified, readable format divided into logically arranged and captioned sections: • Homeowner and renter policies; • Personal auto policies; • Individual and group life policies; and • Individual and group accident and sickness (health) policies.
Nonrenewal or Cancellation of Motor Vehicle or Motorcycle (Auto) Policies
The following cancellation rules do not apply to any auto policy which has been in effect less than 60 days. The following CANNOT be reasons for auto policy nonrenewal: • Use of the auto in a lawful occupation; • The Insured's military service if the Insured is still a legal resident of Georgia; • The number of years driving experience of a member of the household; • Age, sex, location of residence within the state, race, creed, national origin, ancestry, or marital status; • "Failure to agree to a writing of supporting insurance business;" • Accidents or violations which occurred more than 36 months earlier; • Claims paid under the policy during the preceding 36 month period which did not exceed $750 in total; • One at fault claim against the policy during the prior 36 months (must have 2 at fault claims in the prior 36 months); • Two at fault claims against the policy within the prior 72 months (must have 3 at fault claims within the prior 72 months); or • For two or fewer of the following within the prior 36 months: • Accidents involving 2 or more motor vehicles in which the driver of the insured automobile was not at fault (must have had 3 non fault claims within the prior 36 months); • Uninsured or underinsured motorist coverage claims (must have had 3 or more); • Comprehensive coverage claims (must have had 3 or more); • Towing or road service coverage claims (must have had 3 or more).
Georgia Automobile Insurance Plan (Assigned Risk Plan)
The purpose of the Georgia Automobile Insurance Plan (GAIP) is to provide for the equitable apportionment among such auto insurers of persons unable to obtain motor vehicle policies through the voluntary market. All auto insurance companies must participate in the assigned risk plan's residual market. GAIP will provide: • Physical damage coverage; • Medical payments coverage; • Uninsured Motorist coverage; and • Liability coverage with a maximum $350,000 single limit or 100/300/50 split limits. To be eligible, the applicant must certify in writing that the applicant has been unable to obtain auto insurance from 2 companies in the last 60 days. GAIP will not provide coverage if the person who usually drives the vehicle does not have a valid driver's license.
Uninsured Motorist Coverage
Unless rejected by the Insured in writing, every motor vehicle liability Insurer must offer an endorsement for Uninsured Motorist in the amount of at least: • $25,000 Bodily Injury per Person; • $50,000 Bodily Injury per Accident; and • $25,000 Property Damage per Accident; or • At the option of the Insured, not less than the limits of the Insured's liability coverage. The Uninsured Motorist coverages may be subject to the following deductibles which must result in a lower premium: • For Bodily Injury or Property Damage, deductibles of $250, $500, or $1,000, at the option of the Insured.
Nonresident Adjusters are not required to be licensed to:
• Adjust a single loss or losses arising out of a common catastrophe; or • Adjust on a emergency basis for up to 60 days if the nonresident adjuster is licensed in another state.
In the event of an agent's incapacitation due to death, illness, disability, or military service, if there is no other individual connected with the agency who is licensed for insurance of the type transacted by the incapacitated agent, the Commissioner may issue a Temporary License to the following for the purpose of either continuing or winding up the business: What is a requirement of the temporary agent? How long will the temporary license be valid? Option to renew? Restrictions on writing business?
• An employee of the agency; • A member of the incapacitated agent's family; • A guardian, receiver, executor, or administrator. A Temporary Agent must be supervised by a licensed agent. A Temporary License will be valid for only 6 months, renewable for 3 month extensions to a maximum of 15 months from the date of first issue. A Temporary Agent may renew existing policies but cannot sell new policies.
At any time, the Commissioner may examine the records of:
• Any Insurer authorized to do business in Georgia; • Any licensed insurance agent, broker, counselor, or adjuster; and • Any person transacting the business of insurance.
The purpose of the LH Guaranty Association is to protect policy owners against Life or Health Insurer insolvency by:
• Creating an association of Insurers to guarantee the payment of claims; and • Permitting the LH Guaranty Association to assess member Insurers to provide these funds.
A motor vehicle policy may be cancelled due to any of the following involving the Insured within the prior 36 months: When a policy is nonrenewed or canceled other than for nonpayment of premium, the Insurer must notify....?
• Drug addiction; • Failure to fully disclose accidents or moving traffic violations; • Suspension or revocation of the driver's license of a person in the household; • Conviction of a felony; • Criminal negligence resulting in death, homicide, or assault involving the use of a motor vehicle; • Operating a motor vehicle while under the influence of drugs or alcohol; • Leaving the scene of an accident without stopping to report; • Theft of a motor vehicle; • False statements in a driver's license application; or • Conviction or forfeiture of bail for 3 or more motor vehicle violations. When a policy is nonrenewed or canceled other than for nonpayment of premium, the Insurer must notify the named Insured of the potential for coverage through the Georgia Automobile Insurance Plan.
It is illegal for an Insurer to:
• Fail to use due diligence in paying all claims; • Compel, without just cause, claimants to accept less than the amount due them; or • Accept money, trade stamps, gifts, or other remuneration of any kind in return for referring automobile and other property repair business including glass breakage to a particular automobile repairer, glass company, contractor, construction company, or other repair company of any kind.
In terms of place of business, every licensee must:
• Have a place of business accessible to the public (which may be in the home BUT may not be a mere post office box); • Notify the Commissioner in writing within 30 days of any change in business address.
The Commissioner has the authority to...
• Make rules and regulations after giving notice to the public; • Organize the DOI and assign duties to staff members; • Issue orders (cease and desist orders) to agents or Insurers; and • Regulate anything involving "transacting insurance."
What are the requirements for the hearing demanded by the aggrieved individual.
• Must be held within 30 days of request; • May be held at any place designated by the Commissioner; • Must be open to the public; • Requires that at least 10 days advance notice be given to all affected persons; • Must allow the affected persons to testify, present evidence and witnesses, be represented by counsel, and to subpoena witnesses and other evidence.
In terms of Reporting Premiums The agent must:
• State the amount of the premium in the policy; and • Report the amount of the premium to the Insurer.
