SB 138: "An Act relating to the business of insurance, including changes to the insurance code to implement federal financial services reforms for the business of insurance and to authorize the director of insurance to review criminal backgrounds for individuals applying to engage in the business of insurance; amending Rule 402, Alaska Rules of Evidence; and providing for an effective date."
00 SENATE BILL NO. 138 01 "An Act relating to the business of insurance, including changes to the insurance code to 02 implement federal financial services reforms for the business of insurance and to 03 authorize the director of insurance to review criminal backgrounds for individuals 04 applying to engage in the business of insurance; amending Rule 402, Alaska Rules of 05 Evidence; and providing for an effective date." 06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 07 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 08 to read: 09 PURPOSE. The primary purpose of this Act is to implement insurance reforms in 10 AS 21 as required by P.L. 106-102 (Gramm-Leach-Bliley Act) to modernize financial 11 services related to the business of insurance and to further this state as an attractive place for 12 investment and other commerce involving the insurance industry. 13 * Sec. 2. AS 21.27.010(e) is repealed and reenacted to read:
01 (e) An employee of an insurer who responds to requests from existing 02 policyholders on existing policies is not required to be licensed under this section if 03 the employee 04 (1) is not directly compensated based on volume of premiums that may 05 result from those services; and 06 (2) does not otherwise transact insurance. 07 * Sec. 3. AS 21.27.010(j) is amended to read 08 (j) This section does not apply to a person who 09 (1) is employed on salary or hourly wage by a person licensed under 10 this section solely for the performance of accounting, clerical, stenographic, and 11 similar office duties; 12 (2) only secures and forwards information required for the purposes of, 13 and does not receive a commission for, any of the following services: 14 (A) performing administrative services related to 15 (i) group life insurance; 16 (ii) group property and casualty insurance; 17 (iii) group annuities; 18 (iv) group or blanket accident and health insurance; 19 (B) enrolling individuals under plans for the types of 20 insurance or annuities specified in (A) of this paragraph; 21 (C) issuing certificates under plans for the types of 22 insurance or annuities specified in (A) of this paragraph, or otherwise 23 assisting in administering those plans; 24 (D) performing administrative services related to mass- 25 marketed property and casualty insurance [COVERING THE UNPAID 26 BALANCE, OR REMAINING PAYMENTS PROPOSED TO BE MADE, IN 27 CONNECTION WITH THE PURCHASE OF MERCHANDISE OR 28 SERVICES, IF THE PERSON RECEIVES NO COMPENSATION, 29 DIRECTLY OR INDIRECTLY, ARISING OUT OF OR IN ANY WAY 30 RELATING TO THE INSURANCE TRANSACTIONS]; [OR] 31 (3) is employed on salary by a licensee at the licensee's place of
01 business, is supervised by and reports directly to a licensee in the firm, and who, after 02 explaining that the matter must be reviewed by a licensee, may 03 (A) furnish premium estimates from published or printed lists 04 of standard rates if the person does not advise, counsel, or suggest what 05 coverage may be needed, or otherwise solicit insurance coverage; 06 (B) arrange appointments for a licensee if the person does not 07 solicit insurance coverage; 08 (C) record information from an applicant or policyholder and 09 complete for the licensee's personal review and signature, a certificate of 10 insurance that is not a contract of insurance; the licensee's signature may be by 11 facsimile; 12 (D) inform a policyholder of the type of coverage shown in the 13 licensee's policy record if the person does not advise that an event or 14 hypothetical event is or is not covered; or 15 (E) in the physical presence of the licensee, record information 16 from an applicant or policyholder and complete for a licensee's personal 17 review and personal signature, applications, binders, endorsements, or 18 identification cards if the person discloses to the applicant or policyholder that 19 the applicant or policyholder may review the matter with a licensee; 20 (4) is an employee of an insurer or an organization employed by an 21 insurer and is engaged in the inspection, rating, or classification of risks, or in the 22 supervision of the training of insurance producers and is not individually 23 engaged in the sale, solicitation, or negotiation of insurance; 24 (5) advertises in this state through printed publications or 25 electronic mass media whose distribution is not limited to residents of this state, if 26 the person 27 (A) performs no other insurance-related activities in this 28 state; 29 (B) does not intend to solicit in this state; and 30 (C) does not sell, solicit, or negotiate insurance of risks 31 resident, located, or to be performed in this state;
01 (6) is not a resident of this state, but sells, solicits, or negotiates 02 commercial property and casualty insurance for an insured with risks located in 03 more than one state, if the person is licensed as an insurance producer in the state 04 where the insured maintains its principal place of business and the contract of 05 insurance covers risks located in that state; 06 (7) is a salaried full-time employee who counsels or advises the 07 person's employer regarding the insurance interests of the employer or of the 08 subsidiaries or business affiliates of the employer, if the employee does not sell or 09 solicit insurance or receive a commission from the sale or solicitation of 10 insurance; or 11 (8) is an employer or association or the employer's or association's 12 officer, director, employee, or the trustee of an employee trust plan, if the person 13 is not compensated, directly or indirectly, for transacting insurance and is 14 engaged in the administration or operation of a plan offering employee benefits 15 for the employer's or association's own employees, or the employees of its 16 subsidiaries or affiliates; to qualify under this paragraph, the plan must include 17 insurance for employees. 18 * Sec. 4. AS 21.27.020(b) is amended to read: 19 (b) To qualify for issuance or renewal of an individual or individual in the 20 firm license, an applicant or licensee shall comply with this title, regulations adopted 21 under AS 21.06.090, and 22 (1) be 18 [19] years of age or older [WITH A HIGH SCHOOL OR 23 GENERAL EDUCATION DEVELOPMENT DIPLOMA OR EQUIVALENT]; 24 (2) if for a resident license, be a bona fide resident before issuance of 25 the license and actually reside in the state; 26 (3) successfully pass an examination required under AS 21.27.060; 27 (4) be a trustworthy person; 28 (5) not use or intend to use the license for the purpose principally of 29 writing controlled business, as defined in AS 21.27.030; 30 (6) not have committed an act that is a cause for denial, nonrenewal, 31 suspension, or revocation of a license in this state or another jurisdiction.
01 * Sec. 5. AS 21.27.020(c) is repealed and reenacted to read: 02 (c) To qualify for issuance or renewal of a license as a firm insurance 03 producer, a firm managing general agent, a firm reinsurance intermediary broker, a 04 firm reinsurance intermediary manager, a firm surplus lines broker, or a firm 05 independent adjuster, an applicant or licensee shall 06 (1) comply with (b)(4) and (5) of this section; 07 (2) maintain a lawfully established place of business in this state, 08 except when licensed as a nonresident under AS 21.27.270; 09 (3) disclose to the director all owners, officers, directors, or partners of 10 the firm; 11 (4) designate a compliance officer for the firm; 12 (5) provide to the director documents necessary to verify the 13 information contained in or made in connection with the application; and 14 (6) notify the director, in writing, within 30 days of a change in the 15 firm's compliance officer or of the termination of employment of an individual in the 16 firm licensee. 17 * Sec. 6. AS 21.27.020(f) is amended to read: 18 (f) The director may adopt regulations establishing additional education or 19 experience requirements for applicants or licensees under this chapter upon due 20 consideration of the availability and accessibility of education and training 21 opportunities in rural areas of the state. Regulations adopted under this subsection are 22 subject to the following provisions: 23 (1) additional educational or experience requirements may not apply to 24 a licensee who has been licensed by the division of insurance before January 1, 1980; 25 (2) a licensee shall complete at least 24 credit hours of approved 26 continuing education courses during each two-year license period; 27 (3) if a licensee has accumulated more credit hours than required under 28 (2) of this subsection by the end of the license period, a maximum of eight hours may 29 be carried over to meet the requirements of (2) of this subsection in the next license 30 period; 31 (4) a program or seminar may not be approved as an acceptable
01 continuing education program unless it is a formal program of learning that 02 contributes to the professional competence of the licensee; individual study programs 03 or correspondence courses may be used to fulfill continuing education requirements if 04 approved by the director; 05 (5) a nonresident licensee is exempt from the requirements of this 06 subsection [IF THE LICENSEE SUBMITS EVIDENCE SATISFACTORY TO THE 07 DIRECTOR THAT THE LICENSEE HAS SATISFIED ANY CONTINUING 08 EDUCATION REQUIREMENTS OF THE LICENSEE'S DOMICILIARY STATE]. 09 * Sec. 7. AS 21.27.025(a) is amended to read: 10 (a) A licensee shall notify the director within 30 days in writing [BY 11 CERTIFIED MAIL] of a change in residence, employment that is licensed under this 12 chapter, place of business, legal name, fictitious name or alias, mailing address, or 13 phone number[; A SUSPENSION, REVOCATION, OR DISCIPLINARY ACTION 14 OF A LICENSE BY ANOTHER STATE OR JURISDICTION; OR A CONVICTION 15 OF A MISDEMEANOR OR FELONY]. A licensee shall report in writing to the 16 director any administrative action taken against the licensee by a governmental 17 agency of another state or by a governmental agency of another jurisdiction 18 within 30 days after the final disposition of the action. A licensee shall submit to 19 the director the final order and other relevant legal documents in the action. A 20 licensee shall report to the director any criminal prosecution of the licensee in 21 this or another state or jurisdiction within 30 days after the date of filing of the 22 criminal complaint, indictment, information, or citation in the prosecution. The 23 licensee shall submit to the director a copy of the criminal complaint, calendaring 24 order, and other relevant legal documents in the prosecution. 25 * Sec. 8. AS 21.27.025(b) is amended to read: 26 (b) A compliance officer [PRINCIPAL OR MANAGER] shall notify the 27 director in writing within 30 days of a termination of employment of a licensed 28 individual in the firm. Notice required under this subsection must include 29 (1) the licensee's name; 30 (2) the firm's name and address; 31 (3) the date of hire, self-employment, or termination of the licensee;
01 and 02 (4) other information required by the director. 03 * Sec. 9. AS 21.27.040(a) is amended to read: 04 (a) Application for a license shall be made to the director upon forms 05 prescribed by the director. As a part of or in connection with the application, the 06 applicant shall furnish information concerning the applicant's identity, personal 07 history, experience, business record, purposes, and other pertinent facts that the 08 director may reasonably require. The applicant shall declare, [UNDER OATH AND] 09 subject to penalty of denial, nonrenewal, suspension, or revocation of a license issued 10 by the director, that the statements made in or in connection with the application are 11 true, correct, and complete to the best of the applicant's knowledge and belief. 12 Payment of an application fee established under AS 21.06.250 must be submitted with 13 the application. 14 * Sec. 10. AS 21.27.040 is amended by adding a new subsection to read: 15 (e) As part of the application required by (a) of this section, an applicant shall 16 furnish to the director a full set of fingerprints so that the director may obtain criminal 17 justice information as provided under AS 12.62 about the applicant. The director shall 18 submit the completed fingerprint card to the Department of Public Safety. The 19 Department of Public Safety is authorized to submit the fingerprints to the Federal 20 Bureau of Investigation for a national criminal history record check. 21 * Sec. 11. AS 21.27.060(a) is amended to read: 22 (a) Except as provided in this chapter, an applicant for an individual license 23 and a compliance officer [PRINCIPAL OR MANAGER] applicant for a firm license 24 shall, before the issuance of the license, personally take and pass, to the satisfaction of 25 the director, an examination that tests the knowledge and competence of the applicant 26 as to the applicant's duties and responsibilities as a licensee and the insurance statutes 27 [LAWS] and regulations of the state. 28 * Sec. 12. AS 21.27.060(c) is repealed and reenacted to read: 29 (c) An individual who applies for an insurance producer license in this state 30 who was previously licensed for the same lines of authority in that individual's prior 31 home state is not required to pass the examination required by (a) of this section in
01 order to secure the same authority in this state. The exemption available under this 02 subsection applies only if the application is received within 90 days after the 03 cancellation of the applicant's previous license in the applicant's prior home state and 04 (1) the applicant's prior home state verifies that, at the time of 05 cancellation, the applicant held an insurance producer license that was in good 06 standing in that state; or 07 (2) the insurance producer licensing database records for the prior 08 home state that are maintained by the National Association of Insurance 09 Commissioners or its affiliates or subsidiaries indicate that the applicant is or was 10 licensed in good standing for the kind of license requested. 11 * Sec. 13. AS 21.27.060(d) is amended to read: 12 (d) This section does not apply to an applicant 13 (1) for a limited license under AS 21.27.150(a)(1), (5), or (6) 14 [AS 21.27.150(a)(1), (2), (6), OR (7)]; or 15 (2) who, at any time within the one-year [TWO-YEAR] period 16 immediately preceding the date the current pending application is received by the 17 division, had been licensed in good standing in this state under a license requiring 18 substantially similar qualifications as required by the license applied for [; OR 19 (3) WHOSE LICENSE IN ITS RESIDENT JURISDICTION 20 REQUIRES THE SAME QUALIFICATIONS AS THE LICENSE APPLIED FOR IN 21 THIS STATE IF THE LICENSE IN ALL JURISDICTIONS IS IN GOOD 22 STANDING]. 23 * Sec. 14. AS 21.27.100 is amended by adding new subsections to read: 24 (f) An insurer may appoint an insurance producer to all or some insurers 25 within the insurer's holding company system or group by the filing of a single 26 appointment under this subsection. 27 (g) The authorized or apparently authorized acts on behalf of an appointing 28 insurer of an insurance producer appointed under this section are considered the acts 29 of that insurer. 30 * Sec. 15. AS 21.27.110 is repealed and reenacted to read: 31 Sec. 21.27.110. Term of appointment. (a) An appointment under
01 AS 21.27.100 continues in force until the appointment is terminated in accordance 02 with this section. 03 (b) If an appointment is terminated by an insurer, reinsurer, or authorized 04 representative, the insurer, reinsurer, or authorized representative shall, on a form or in 05 a format prescribed by the director, notify the director within 30 days following the 06 date of termination of the appointment. 07 (c) If an appointment is terminated by the director, a written or an electronic 08 notice of termination shall be given to the appointee, to the person that made the 09 appointment, and, if different from the person making the appointment, to the insurer 10 or reinsurer, at least 10 days before the effective date of the termination. The director 11 shall send notification under this subsection to the latest address on record with the 12 director. 13 (d) If, after termination and notice under (b) of this section, an insurer, 14 reinsurer, or authorized representative discovers additional information showing that 15 the appointee whose appointment was terminated has engaged in an activity identified 16 in AS 21.27.410 during the period of the appointment, the insurer, reinsurer, or 17 authorized representative shall, on a form or in a format prescribed by the director, 18 promptly notify the director. 19 (e) Within 15 days after providing notification in accordance with (b) and (d) 20 of this section, the insurer, reinsurer, or authorized representative shall mail a copy of 21 the notification to the appointee at the last address on record with the director. The 22 notice must be provided by certified mail, return receipt required, postage prepaid, or 23 by overnight delivery using a nationally recognized mail carrier, if the appointment 24 was terminated for an activity identified in AS 21.27.410. 25 (f) Within 30 days after the appointee receives notification in accordance with 26 (c) of this section, the appointee may file written comments concerning the substance 27 of the notification with the director and must provide a copy of the written comments 28 to the insurer, reinsurer, or authorized representative. The written comments filed 29 with the director will be provided with each report distributed or disclosed concerning 30 any reason about the termination of the appointment. 31 (g) If requested by the director, an insurer, reinsurer, or authorized
01 representative shall provide to the director additional information, documents, records, 02 or other data pertaining to a termination or activity of a licensee under this title. 03 (h) A notice of termination submitted to the director under this section must 04 include a statement of the reasons for the termination. A statement of the reasons for 05 termination is confidential and not subject to inspection and copying under 06 AS 40.25.110. A statement of reasons for the termination may not be admitted as 07 evidence in a civil action or an administrative proceeding against an insurer, reinsurer, 08 or authorized representative by or on behalf of a person affected by the termination, 09 except when the action or proceeding involves perjury, unsworn falsification, fraud, or 10 failure to comply with this subsection. 11 (i) If an insurer, reinsurer, or authorized representative fails to report as 12 required under this section or is found by a court to have knowingly or intentionally 13 falsely made that report, the director may, after notice and hearing, suspend or revoke 14 the license or certificate of authority of the insurer, reinsurer, or authorized 15 representative and may impose a penalty in accordance with AS 21.27.440. 16 (j) The director may require that an insurer renew an appointment annually 17 and may require payment of a renewal fee under AS 21.06.250 for an appointment in 18 effect on December 31 of the current year. If the director requires that an appointment 19 be renewed or a renewal fee be paid, the director shall terminate the appointment if the 20 renewal fees have not been received by the director on or before the close of business 21 on March 1 of the renewal year. 22 * Sec. 16. AS 21.27 is amended by adding a new section to read: 23 Sec. 21.27.115. Lines of authority. If a person has met the applicable 24 requirements of AS 21.27.020 and 21.27.270, the director shall issue a license for one 25 or more of the following lines of authority: 26 (1) life insurance coverage on natural persons; in this paragraph, "life 27 insurance coverage" 28 (A) includes benefits of endowment and annuities; and 29 (B) may include benefits in the event of death or 30 dismemberment by accident and benefits for disability income; 31 (2) health insurance coverage for sickness, bodily injury, or accidental
01 death; in this paragraph, "health insurance coverage" may include benefits for 02 disability income; 03 (3) property insurance coverage for the direct or consequential loss for 04 damage to property of every kind; 05 (4) casualty insurance coverage against legal liability, including that 06 for death, injury, or disability or damage to real or personal property; in this 07 paragraph, "casualty insurance" includes surety insurance as defined in AS 21.12.080; 08 (5) variable life and variable annuity products insurance coverage; 09 (6) personal lines property and casualty insurance coverage sold to 10 individuals and families for primarily noncommercial purposes; 11 (7) limited lines credit insurance; 12 (8) any insurance for which a limited lines license may be issued under 13 AS 21.27.150. 14 * Sec. 17. AS 21.27.130 is amended to read: 15 Sec. 21.27.130. Form and content of licenses. A license must be in the form 16 the director prescribes and must set out 17 (1) the name and address of the licensee, and, if the licensee is required 18 to have a place of business, the physical address of the place of business; 19 (2) [IF FOR A FIRM, THE NAME OF THE PRINCIPAL OR 20 MANAGER OF THE FIRM; 21 (3)] the type, [KIND OR] class, and lines of authority [OF 22 INSURANCE] the licensee is licensed to handle; 23 (3) [(4)] the effective date and expiration date of the license; 24 (4) each condition, if any, [(5) THE CONDITION] under which the 25 license is granted; 26 (5) [(6)] the date of issuance of the license; 27 (6) [(7)] each fictitious name and alias under which the licensee may 28 do business; and 29 (7) [(8)] other information required by the director. 30 * Sec. 18. AS 21.27.130 is amended by adding a new subsection to read: 31 (b) A license issued by the director does not in itself create any authority,
01 actual, apparent, or inherent, in the holder of the license to represent or commit an 02 insurer. 03 * Sec. 19. AS 21.27.140(b) is amended to read: 04 (b) A firm may not be licensed as an insurance producer, managing general 05 agent, reinsurance intermediary broker, reinsurance intermediary manager, surplus 06 lines broker, or independent adjuster, or transact insurance unless each individual 07 employed as an insurance producer, managing general agent, surplus lines broker, 08 trainee insurance producer, trainee independent adjuster, or independent adjuster by 09 the firm is licensed as an individual in the firm and the compliance officer 10 [PRINCIPAL OR MANAGER] of the firm is licensed as an individual in the firm to 11 exercise all the powers conferred by the firm's license. 12 * Sec. 20. AS 21.27.140(c) is amended to read: 13 (c) If the director determines under AS 21.06.170 - 21.06.240 that a firm knew 14 or should have known of an act or representation made on the firm's behalf by a 15 person not licensed as required by this chapter, the firm and the firm's compliance 16 officer [PRINCIPAL OR MANAGER] are subject to the penalties provided under 17 AS 21.27.440. 18 * Sec. 21. AS 21.27.150(a) is amended to read: 19 (a) The director may issue a 20 (1) travel insurance limited producer license to a person [WHOSE 21 PLACE OF BUSINESS IS LOCATED IN THIS STATE,] who sells transportation 22 tickets of a common carrier of persons or property, who is appointed under 23 AS 21.27.100, and whose sole purpose is to be appointed by and act as an agent for 24 transportation ticket policies of health insurance, baggage insurance on personal 25 effects, and trip cancellation or trip interruption insurance; 26 (2) [HEALTH INSURANCE LIMITED PRODUCER LICENSE TO 27 A RESIDENT OF THIS STATE WHOSE SOLE PURPOSE IS TO BE APPOINTED 28 BY AND ACT AS AN AGENT FOR HEALTH INSURANCE PERTAINING TO 29 SPORTS AND RECREATION; 30 (3)] title insurance limited producer license to a person whose place of 31 business is located in this state and whose sole purpose is to be appointed by and act
01 on behalf of a title insurer; 02 (3) [(4)] bail bond limited producer license to a person [WHOSE 03 PLACE OF BUSINESS IS LOCATED IN THIS STATE AND] whose sole purpose is 04 to be appointed by and act on behalf of a surety insurer pertaining to bail bonds; 05 (4) [(5)] fraternal benefit society limited producer license to a person 06 whose sole purpose is to be appointed by and act on behalf of a fraternal benefit 07 society licensed under AS 21.84; 08 [(6) RETIRED INSURANCE PRODUCER LICENSE TO A 09 RESIDENT WHO IS RETIRED OR RETIRING FROM THE BUSINESS OF 10 INSURANCE AND SURRENDERS ALL IN-FORCE LICENSES TO ALLOW THE 11 PERSON TO RECEIVE A CONTINUING COMMISSION IN REGARD TO 12 INSURANCE TRANSACTED BEFORE RETIREMENT; A RETIRED 13 INSURANCE PRODUCER LICENSEE MAY NOT SOLICIT, INDUCE, 14 NEGOTIATE, OR EFFECTUATE CONTRACTS OF INSURANCE; THE 15 DIRECTOR MAY RENEW A RETIRED INSURANCE PRODUCER LICENSE IF 16 THE LICENSEE CEASES TO BE A RESIDENT OF THIS STATE;] 17 (5) [(7)] motor vehicle rental agency limited producer license to a 18 person and, subject to the approval of the director, to employees of the person licensed 19 that the licensee authorizes to transact the business of insurance on the licensee's 20 behalf if, as to an employee, the licensee complies with (D) of this paragraph and if 21 the licensee 22 (A) rents to others, without operators, 23 (i) private passenger motor vehicles, including 24 passenger vans, minivans, and sport utility vehicles; or 25 (ii) cargo motor vehicles, including cargo vans, pickup 26 trucks, and trucks with a gross vehicle weight of less than 26,000 27 pounds that do not require the operator to possess a commercial driver's 28 license; 29 (B) rents motor vehicles only to persons under rental 30 agreements that do not exceed a term of 90 days; 31 (C) transacts only the following kinds of insurance:
01 (i) motor vehicle liability insurance with respect to 02 liability arising out of the use of a vehicle rented from the licensee 03 during the term of the rental agreement; 04 (ii) uninsured or underinsured motorist coverage, with 05 minimum limits described in AS 21.89.020(c) and (d) arising out of the 06 use of a vehicle rented from the licensee during the term of the rental 07 agreement; 08 (iii) insurance against medical, hospital, surgical, and 09 disability benefits to an injured person and funeral and death benefits to 10 dependents, beneficiaries, or personal representatives of a deceased 11 person if the insurance is issued as incidental coverage with or 12 supplemental to liability insurance and arises out of the use of a vehicle 13 rented from the licensee during the term of the rental agreement; 14 (iv) personal effects insurance, including loss of use, 15 with respect to damage to or loss of personal property of a person 16 renting the vehicle and other vehicle occupants while that property is 17 being loaded into, transported by, or unloaded from a vehicle rented 18 from the licensee during the term of the rental agreement; 19 (v) towing and roadside assistance with respect to 20 vehicles rented from the licensee during the term of the rental 21 agreement; and 22 (vi) other insurance as may be authorized by regulation 23 by the director; 24 (D) notifies the director in writing, within 30 days of 25 employment, of the name, date of birth, social security number, location of 26 employment, and home address of an employee authorized by the licensee to 27 transact insurance on the licensee's behalf; and 28 (E) provides other information as required by the director; 29 (6) nonresident limited producer license to a person, granting the 30 same scope of authority as a limited lines producer license issued to the person by 31 the person's home state;
01 (7) credit insurance limited producer license to a person who sells 02 limited lines credit insurance; 03 (8) miscellaneous limited producer license to a person who 04 transacts insurance in this state that restricts the person's authority to less than 05 the total authority for a line of authority described in AS 21.27.115(1) - (6). 06 * Sec. 22. AS 21.27.270 is repealed and reenacted to read: 07 Sec. 21.27.270. Licensing of nonresidents. (a) In accordance with P.L. 106- 08 102 (Gramm-Leach-Bliley Act), the director shall issue a license to a nonresident 09 license applicant on terms that are reciprocal with those of the applicant's home state. 10 Notwithstanding any contrary provision of this chapter, the director may by order 11 waive any license application requirement in this chapter to achieve reciprocity to 12 license a nonresident in accordance with P.L. 106-102 (Gramm-Leach-Bliley Act). 13 (b) Unless the director denies or refuses to renew a license under 14 AS 21.27.410, the director shall issue a nonresident producer, limited lines, surplus 15 lines broker, managing general agent, reinsurance intermediary broker, or reinsurance 16 intermediary manager license to a person who is not a resident of this state if 17 (1) the person is currently licensed and is in good standing in the 18 person's home state; the director may verify the person's licensing status through the 19 producer licensing database records maintained by the National Association of 20 Insurance Commissioners or its affiliates or subsidiaries; 21 (2) the person has paid the fees required under AS 21.06.250 and has 22 submitted to the director 23 (A) the license application the person submitted to the person's 24 home state; or 25 (B) if the person is not a firm, a completed uniform application 26 or, if a firm, the uniform business entity application; and 27 (3) the person's home state awards nonresident producer, limited lines, 28 surplus lines, managing general agent, reinsurance intermediary broker, and 29 reinsurance intermediary manager licenses to residents of this state on the same basis 30 as does this state. 31 (c) Notwithstanding (b) of this section, the director may require
01 (1) a person applying for a nonresident license to furnish the person's 02 fingerprints as required of a person applying for a license under AS 21.27.040(e); 03 (2) a person applying for a surplus lines broker license under this 04 section to have, and maintain while licensed in this state, the bond required of a person 05 applying for a license under AS 21.27.790(2); and 06 (3) a person applying for a nonresident license to comply with the 07 premium fiduciary account requirements of AS 21.27.360 and the regulations adopted 08 under that statute. 09 (d) A person licensed as a limited lines producer in the person's home state 10 shall receive a nonresident limited lines producer license granting the same scope of 11 authority as the license issued by the producer's home state. 12 (e) In addition to the other requirements of this chapter, a person may not be 13 licensed as a nonresident licensee until the person files a power of attorney as follows: 14 (1) an applicant shall appoint the director as attorney to receive service 15 of legal process issued against the licensee in this state upon a cause of action arising 16 in this state or relative to a subject resident, located, or to be performed in this state; 17 service upon the director as attorney shall constitute effective legal service upon the 18 licensee; and 19 (2) the appointment shall be irrevocable for as long as there could be a 20 cause of action against the licensee arising out of an insurance transaction in this state 21 or relative to a subject resident, located, or to be performed in this state. 22 (f) Duplicate copies of legal process against a licensed or formerly licensed 23 nonresident licensee shall be served upon the director either by a peace officer or 24 through certified mail with return receipt requested. At the time of service, the 25 plaintiff shall pay to the director a fee set under AS 21.06.250. 26 (g) Upon receiving a service of process, the director shall immediately send 27 one of the copies of the process by certified mail with return receipt requested to the 28 licensed or formerly licensed nonresident licensee at the last address of record filed 29 with the director. 30 * Sec. 23. AS 21.27 is amended by adding a new section to read: 31 Sec. 21.27.275. Alien licensees. The director may issue the respective license
01 authorized by this chapter to a nonresident of this state who does not have a home 02 state if that person meets all the requirements of this chapter for that license applicable 03 to a resident of this state applying for the same license. 04 * Sec. 24. AS 21.27.330 is repealed and reenacted to read: 05 Sec. 21.27.330. Place of business. (a) A person licensed under this chapter 06 shall have and maintain at least one place of business that is physically accessible to 07 the public in this state unless the person holds a nonresident license and principally 08 conducts transactions in another state. However, the nonresident licensee must have at 09 least one physically accessible place in the nonresident licensee's home state. The 10 requirements of this subsection do not apply to a licensee who only conducts business 11 in life or health insurance or annuities. 12 (b) If a licensee that is a firm transacts business at more than one place of 13 business in this state, the licensee shall pay a license fee for each place of business. 14 * Sec. 25. AS 21.27.350(c) is amended to read: 15 (c) The records of a particular transaction shall be retained and kept open for 16 examination and inspection by the director at any business time during the five years 17 immediately after the date of the completion of the transaction or 10 years for 18 reinsurance transactions, unless the director orders a longer period of retention. If a 19 licensee assumes the business of another licensee or former licensee by merger, 20 purchase, or otherwise, the compliance officer [PRINCIPAL OR MANAGER] of the 21 assuming licensee firm shall provide to the director in writing each location where the 22 assumed licensee's records are maintained by the assuming licensee during the period 23 in which the records must be kept available and open to the inspection of the director. 24 A formerly licensed person shall provide to the director in writing each location where 25 records shall be maintained during the period in which the records of a particular 26 transaction must be kept available and open to the examination and inspection of the 27 director. A formerly licensed person may, with the permission of the director, arrange 28 to have a current licensee or the home office of the last known insurer of each 29 policyholder, maintain the records open to the examination and inspection of the 30 director during the period in which the records must be maintained. 31 * Sec. 26. AS 21.27.370 is repealed and reenacted to read:
01 Sec. 21.27.370. Sharing compensation. (a) Except as provided in (c) of this 02 section, a licensee may not compensate a person, other than a licensee who is acting 03 within the scope of the person's license, for transacting insurance in this state or 04 relative to a risk resident, located, or to be performed in this state. 05 (b) Except as provided in (c) of this section, a person may not be promised or 06 paid, directly or indirectly, compensation for transacting a kind or class of insurance 07 for which the person is not then licensed to transact or for insurance that the person is 08 prohibited by this title from transacting. 09 (c) An unlicensed person who refers a customer or potential customer to a 10 licensee and who does not discuss specific terms and conditions of a policy, or gives 11 opinions or advice regarding insurance, may be compensated for the referral, if the 12 compensation 13 (1) for each referral is 14 (A) nominal; 15 (B) on a one time basis; and 16 (C) fixed in amount by referral; 17 (2) does not depend on whether the customer or potential customer 18 purchases the insurance; and 19 (3) is not contingent on the volume of insurance transacted. 20 (d) A person who is no longer licensed in this state may be paid renewal or 21 other deferred compensation for selling, soliciting, or negotiating insurance in this 22 state if the person 23 (1) was required to be licensed under this chapter at the time of the 24 sale, solicitation, or negotiation; and 25 (2) held that required license. 26 (e) In addition to any other penalty provided by law, the director may suspend 27 or revoke the license of a licensee participating in a violation of this section. The 28 director may order a licensee who violates this section to pay a penalty of not more 29 than three times the compensation promised or paid. 30 * Sec. 27. AS 21.27.390(a) is amended to read: 31 (a) The director may issue a temporary license only to a person who, except
01 for experience, training, or the taking of an examination, meets all qualifications for a 02 permanent license and if the person is 03 (1) the surviving spouse, next of kin, or the administrator or executor 04 of a deceased licensed insurance producer or managing general agent; 05 (2) the spouse, next of kin, employee, or legal guardian of a licensed 06 insurance producer or managing general agent who is disabled from transacting 07 insurance because of sickness, mental illness [INSANITY], or injury; 08 (3) a surviving member, officer, or employee of a firm licensed as 09 insurance producer or managing general agent upon the death of the compliance 10 officer [PRINCIPAL OR MANAGER] of the firm holding the same licenses as the 11 firm; or 12 (4) the designee of a licensed insurance producer who enters active 13 service in the armed forces of the United States, but only for insurance relating to 14 insurers for whom the licensee was acting as an agent. 15 * Sec. 28. AS 21.27.410(b) is amended to read: 16 (b) The license of a firm and its compliance officer [PRINCIPAL OR 17 MANAGER] may be denied, nonrenewed, suspended, or revoked for a violation or 18 cause that relates to a person representing or acting on behalf of the firm. 19 * Sec. 29. AS 21.27.460(c) is amended to read: 20 (c) Upon a change in the state of residence, a place of business, a mailing 21 address, or in the compliance officer [PRINCIPAL OR MANAGER] of a firm, a 22 license subject to the change shall be surrendered to the director within 10 days either 23 personally or by certified mail and the division shall reissue the license reflecting the 24 changes if the licensee continues to satisfy the qualifications under this chapter. 25 * Sec. 30. AS 21.27.540(g) is amended to read: 26 (g) In addition to any other penalty provided by law, if the director determines 27 under AS 21.06.170 - 21.06.240 that the employing licensed insurance producer knew 28 of or should have known that a trainee insurance producer violated this section, the 29 employing licensed insurance producer and firm, and compliance officer 30 [PRINCIPAL AND MANAGER], if any, are subject to the penalties provided under 31 AS 21.27.440.
01 * Sec. 31. AS 21.27.560(a) is amended to read: 02 (a) A client who appoints an insurance producer as its broker in this state or 03 relative to a subject resident, located, or to be performed in this state shall execute a 04 written contract that specifically sets out the duties, functions, powers, authority, and 05 compensation of the insurance producer, if the broker is compensated by a fee paid by 06 the client or by a combination of a fee paid by a client and a commission paid by an 07 insurer with which coverage has been placed. The written contract shall be kept in the 08 permanent records of the insurance producer and be open to inspection by the director. 09 * Sec. 32. AS 21.27.600(g) is amended to read: 10 (g) In addition to any other penalty provided by law 11 (1) the director shall revoke the trainee license of a trainee managing 12 general agent who the director determines has violated the provisions of this section; a 13 licensee or other person having possession or custody of the license shall immediately 14 surrender the license to the director either personally or by certified mail; 15 (2) if the director determines under AS 21.06.170 - 21.06.240 that the 16 employing managing general agent knew of or should have known that a trainee 17 managing general agent violated this section, the employing managing general agent 18 and firm, and compliance officer [PRINCIPAL, AND MANAGER], if any, are 19 subject to the penalties provided under AS 21.27.440. 20 * Sec. 33. AS 21.27.620 is amended by adding a new subsection to read: 21 (l) In this section, "transact" has the meaning given "transact" with respect to 22 insurance in AS 21.90.900. 23 * Sec. 34. AS 21.27.640(b) is repealed and reenacted to read: 24 (b) To qualify for issuance or renewal of a registration, an applicant or 25 registrant shall comply with this title, regulations adopted under AS 21.06.090, and 26 (1) be a trustworthy person; 27 (2) have active working experience in administrative functions that, in 28 the director's opinion, exhibits the ability to competently perform the administrative 29 functions of a third-party administrator; 30 (3) not have committed an act that is a cause for denial, nonrenewal, 31 suspension, or revocation of a registration or license in this state or another
01 jurisdiction; 02 (4) maintain a lawfully established place of business as described in 03 AS 21.27.330 in this state, unless licensed as a nonresident under AS 21.27.270; 04 (5) disclose to the director all owners, officers, directors, or partners, if 05 any; 06 (6) designate a compliance officer for the firm; 07 (7) provide in or with its application 08 (A) all basic organizational documents of the third-party 09 administrator, including articles of incorporation, articles of association, 10 partnership agreement, trade name certificate, trust agreement, shareholder 11 agreement, and other applicable documents and all endorsements to the 12 required documents; 13 (B) the bylaws, rules, regulations, or similar documents 14 regulating the internal affairs of the administrator; 15 (C) the names, mailing addresses, physical addresses, official 16 positions, and professional qualifications of persons who are responsible for 17 the conduct of affairs of the third-party administrator, including the members 18 of the board of directors, board of trustees, executive committee, or other 19 governing board or committee; the principal officers in the case of a 20 corporation, or the partners or members in the case of a partnership, limited 21 liability company, limited liability partnership, or association; shareholders 22 holding directly or indirectly 10 percent or more of the voting securities of the 23 third-party administrator; and any other person who exercises control or 24 influence over the affairs of the third-party administrator; 25 (D) certified financial statements for the preceding two years, 26 or for each year and partial year that the applicant has been in business if less 27 than two years, prepared by an independent certified public accountant 28 establishing that the applicant is solvent, that the applicant's system of 29 accounting, internal control, and procedure is operating effectively to provide 30 reasonable assurance that money is promptly accounted for and paid to the 31 person entitled to the money, and any other information that the director may
01 require to review the current financial condition of the applicant; and 02 (E) a statement describing the business plan, including 03 information on staffing levels and activities proposed in this state and in other 04 jurisdictions and providing details establishing the third-party administrator's 05 capability for providing a sufficient number of experienced and qualified 06 personnel in the areas of claims handling, underwriting, and record keeping; 07 (8) provide to the director documents necessary to verify the 08 statements contained in or in connection with the application; and 09 (9) notify the director, in writing, within 30 days of 10 (A) a change in compliance officer, residence, place of 11 business, mailing address, or phone number; 12 (B) the suspension or revocation of an insurance license or 13 registration by another state or jurisdiction; or 14 (C) a conviction of a misdemeanor or felony of the third-party 15 administrator, its officers, directors, partners, owners, or employees. 16 * Sec. 35. AS 21.27.650 is amended by adding a new subsection to read: 17 (p) In this section, "transact" has the meaning given "transact" with respect to 18 insurance in AS 21.90.900. 19 * Sec. 36. AS 21.27.680(g) is amended to read: 20 (g) In addition to any other penalty provided by law, 21 (1) the director shall revoke the license of a trainee reinsurance 22 intermediary broker who the director determines has violated the provisions of this 23 section; a licensee or other person having possession or custody of the license shall 24 immediately surrender the license to the director either personally or by certified mail; 25 (2) if the director determines under AS 21.06.170 - 21.06.240 that the 26 employing reinsurance intermediary broker knew of or should have known that a 27 trainee reinsurance intermediary broker violated this section, the employing 28 reinsurance intermediary broker and firm, and compliance officer [PRINCIPAL 29 AND MANAGER], if any, are subject to the penalties provided under AS 21.27.440. 30 * Sec. 37. AS 21.27.690 is amended by adding a new subsection to read: 31 (g) In this section, "transact" has the meaning given "transact" with respect to
01 insurance in AS 21.90.900. 02 * Sec. 38. AS 21.27.760 is amended by adding a new subsection to read: 03 (l) In this section "transact" has the meaning given "transact" with respect to 04 insurance in AS 21.90.900. 05 * Sec. 39. AS 21.27.800(g) is amended to read: 06 (g) In addition to any other penalty provided by law, 07 (1) the director shall revoke the license of a trainee surplus lines broker 08 who the director determines has violated the provisions of this section; a licensee or 09 other person having possession or custody of the license shall immediately surrender 10 the license to the director either personally or by certified mail; 11 (2) if the director determines under AS 21.06.170 - 21.06.240 that the 12 employing surplus lines broker knew of or should have known that a trainee licensed 13 under this section violated this section, the employing surplus lines broker and firm, 14 and compliance officer [PRINCIPAL, AND MANAGER], if any, are subject to the 15 penalties provided under AS 21.27.440. 16 * Sec. 40. AS 21.27.840(f) is amended to read: 17 (f) A trainee independent adjuster shall at all times be working at the direction 18 and under the supervision of the employing licensed independent adjuster, and the file 19 and record documentation shall reflect the direction and supervision. The employing 20 licensed independent adjuster and its firm, and compliance officer [MANAGER, 21 AND PRINCIPAL], if any, are responsible for all insurance actions of the trainee 22 independent adjuster. 23 * Sec. 41. AS 21.27.840(i) is amended to read: 24 (i) In addition to any other penalty provided by law, 25 (1) a trainee independent adjuster who the director determines has 26 violated the provisions of this section shall have its license terminated; a licensee or 27 other person having possession or custody of the license shall within 30 days surrender 28 the license to the director either personally or by certified mail; 29 (2) if the director determines under AS 21.06.170 - 21.06.240 that the 30 employing licensed independent adjuster knew of or should have known that a trainee 31 independent adjuster violated this section, the employing licensed independent
01 adjuster and firm, and compliance officer [PRINCIPAL AND MANAGER], if any, 02 are subject to the penalties provided under AS 21.27.440. 03 * Sec. 42. AS 21.27.900(10) is amended to read: 04 (10) "individual" means a natural person required to be licensed under 05 AS 21.27.010 [WHO IS NOT ACTING IN ASSOCIATION WITH TWO OR MORE 06 LICENSEES, EITHER IN PARTNERSHIP, CORPORATION, OR OTHERWISE, 07 OR AN ORGANIZATION IN WHICH A SINGLE LICENSEE HAS 50 PERCENT 08 OR MORE OWNERSHIP INTEREST IN THE ORGANIZATION]; 09 * Sec. 43. AS 21.27.900 is amended by adding new paragraphs to read: 10 (23) "compliance officer" means a licensee under this chapter that is 11 responsible for a firm's compliance with the insurance statutes and regulations of this 12 state; 13 (24) "home state" means the District of Columbia or a state or territory 14 of the United States in which an insurance producer maintains the producer's principal 15 place of residence or principal place of business and is licensed to act as an insurance 16 producer; 17 (25) "insurance producer" means a person who sells, solicits, or 18 negotiates insurance or insurance products; 19 (26) "license" means, unless the context requires otherwise, a 20 document issued by the director of insurance authorizing a person to act for the type, 21 class, and lines of authority specified in the document; 22 (27) "limited lines credit insurance" includes credit life, credit 23 disability, credit property, credit unemployment, involuntary unemployment, mortgage 24 life, mortgage guaranty, mortgage disability, guaranteed automobile protection 25 insurance, and any other form of insurance offered in connection with an extension of 26 credit that is limited to partially or wholly extinguishing that credit obligation that the 27 director of insurance determines must be designated a form of limited lines credit 28 insurance; 29 (28) "limited lines insurance" means those lines of insurance defined in 30 AS 21.27.150 or any other line of insurance that the director of insurance designates 31 by order as a limited line;
01 (29) "negotiate" means the act of conferring directly with or offering 02 advice directly to a purchaser or insured or prospective purchaser or insured of a 03 particular contract of insurance concerning any of the substantive benefits, terms, or 04 conditions of the contract, if the person engaged in that act either sells insurance or 05 obtains insurance from insurers for purchasers or insureds; 06 (30) "sells" means to exchange a contract of insurance by any means, 07 for money or its equivalent, on behalf of an insurance company; 08 (31) "solicit" means attempting to sell insurance or asking or urging a 09 person to apply for a particular kind of insurance from a particular company; 10 (32) "transact" or "transact business" means sell, solicit, or negotiate 11 insurance or insurance products; 12 (33) "uniform application" means the most recent version of the 13 uniform application of the National Association of Insurance Commissioners; 14 (34) "uniform business entity application" means the most recent 15 version of the uniform business entity application of the National Association of 16 Insurance Commissioners. 17 * Sec. 44. AS 21.36 is amended by adding new sections to read: 18 Sec. 21.36.162. Nondisclosure of personal information. (a) Except as 19 provided in 15 U.S.C. 6801 - 6805 (Title V of the Gramm-Leach-Bliley Act of 1999), 20 a person may not disclose personal information records regarding an individual who 21 seeks to obtain, obtains, or has obtained an insurance product or service from a 22 licensee that is to be used primarily for personal, family, or household purposes. 23 (b) The director shall adopt regulations regarding the release of financial and 24 health information regarding an individual who seeks to obtain, obtains, or has 25 obtained an insurance product or service from a licensee that is to be used primarily 26 for personal, family, or household purposes. The regulations must be consistent with, 27 but no less restrictive than, the model regulations adopted by the National Association 28 of Insurance Commissioners on September 26, 2000 concerning the release of that 29 information. 30 Sec. 21.36.164. Licensing of persons in a financial institution. A financial 31 institution may not allow a person to transact insurance in an office of the institution,
01 nor on behalf of the institution, unless the person is licensed as required under 02 AS 21.27. 03 * Sec. 45. AS 21.36.165 is amended to read: 04 Sec. 21.36.165. Anticoercion and antitying [FAVORED AGENT OR 05 INSURER; COERCION OF DEBTORS]. A person may not 06 (1) require, as a condition to the lending of money or extension of 07 credit, or a renewal of the loan or extension of credit, that the obligee of the money or 08 credit negotiate a policy or contract of insurance through any particular person or 09 group of persons; 10 (2) disapprove the insurance policy provided by a borrower for the 11 protection of property securing credit or a loan [LIEN] if disapproval is based on other 12 than reasonable standards uniformly applied and relating to the extent of coverage 13 required and the financial soundness and the services of the insurer; the standards may 14 not discriminate against a particular type of insurer, or call for the disapproval of a 15 policy containing coverage in addition to that required; 16 (3) unless charges are required when the person handling the 17 insurance transaction is a licensee, require a consumer [BORROWER, 18 MORTGAGOR, PURCHASER], insurer, broker, or agent to pay a separate charge for 19 handling an insurance policy required as security for a loan on real property, or to pay 20 a separate charge to substitute the insurance policy of one insurer for that of another, 21 except that interest may be charged on premium loans or [OF] premium advancements 22 in accordance with the security instrument; 23 (4) use or disclose information, including health information, 24 resulting from a requirement that a consumer [BORROWER, MORTGAGOR, OR 25 PURCHASER] furnish insurance of any kind on real property being conveyed or used 26 as collateral security to a loan to another, other than an officer, director, employee, 27 agent, or affiliate of the person for the purpose of soliciting or selling insurance 28 without the written consent of the consumer, except 29 (A) in the case of a transfer of insurance information to an 30 unaffiliated insurer in connection with transferring insurance in force on 31 an existing policyholder of the person;
01 (B) in the case of a transfer of insurance information to an 02 unaffiliated insurer in connection with a merger with or acquisition of an 03 unaffiliated insurer; or 04 (C) when the release of the information is authorized by 05 state or federal law [,WHEN THE INFORMATION IS TO THE 06 ADVANTAGE OF THE MORTGAGEE, VENDOR, OR LENDER, OR IS 07 TO THE DETRIMENT OF THE BORROWER, MORTGAGOR, 08 PURCHASER, INSURER, AGENT, OR BROKER COMPLYING WITH 09 THE REQUIREMENT]. 10 * Sec. 46. AS 21.36.165 is amended by adding new subsections to read: 11 (b) A person shall use separate documents for an insurance transaction, other 12 than credit insurance or flood insurance, and for a credit transaction. 13 (c) A person may not include insurance premiums in a primary credit 14 transaction without the consent of the consumer. 15 (d) A person shall maintain separate and distinct records relating to insurance 16 transactions, including consumer complaint information, and shall make the records 17 available to the director for inspection upon notice. 18 (e) Nothing in this section prohibits a person from informing a consumer or 19 prospective consumer that insurance is required in order to obtain a loan or credit, or 20 that loan or credit approval is contingent upon the procurement of acceptable 21 insurance by the consumer or that insurance is available from the person. 22 * Sec. 47. AS 21.36 is amended by adding new sections to read: 23 Sec. 21.36.167. Misrepresentation in financial institution sales. In the sale 24 of insurance by a financial institution, a person may not engage in any practice or use 25 an advertisement that may tend to mislead or deceive a consumer or cause a consumer 26 to erroneously believe that 27 (1) the insurance is backed by or a return on the insurance is 28 guaranteed by the state, the federal government, the person, or the Federal Deposit 29 Insurance Corporation; 30 (2) the state or federal government 31 (i) will pay a claim under an insurance contract that is
01 an obligation of or was sold by the person; 02 (ii) is responsible for the insurance sales activities of the 03 person; or 04 (iii) the state or federal government guarantees the 05 credit of the person; 06 (3) for insurance that contains investment risk, the insurance does not 07 contain investment risk, the principal may not be lost, or the value of the insurance 08 may not decline; 09 (4) the lending of money, extension of credit, or a renewal of a loan is 10 conditioned on the purchase of insurance from the person and that insurance may not 11 be purchased from another source. 12 Sec. 21.36.168. Disclosures required in financial institution sales. (a) In 13 the sale of insurance by a financial institution, a person shall disclose both orally and 14 in writing to a consumer before the initial purchase of insurance that 15 (1) the insurance is not a deposit or other obligation of the person; 16 (2) the insurance is not guaranteed by the person or the person 17 soliciting insurance; 18 (3) the insurance is not insured by the Federal Deposit Insurance 19 Corporation or other agency of the United States, the financial institution, or the 20 person; 21 (4) if the insurance contains risk, the insurance contains investment 22 risk and the insurance may lose value; 23 (5) the consumer is not required to negotiate a policy or contract of 24 insurance through any particular person or group of persons as a condition to the 25 lending of money or extension of credit, or a renewal of the loan or extension of 26 credit, except that the person may impose reasonable requirements uniformly applied 27 and relating to the extent of coverage required and the financial soundness and the 28 services of the insurer and that the standards may not discriminate against a particular 29 type of insurer or require disapproval of a policy containing coverage in addition to 30 that required. 31 (b) A person shall also provide the disclosures required in (a) of this section to
01 a consumer both orally and in writing at the time of application for an extension of 02 credit. 03 (c) If an application for insurance is made by telephone, written disclosure as 04 required in (a) of this section must be mailed to the consumer within three working 05 days. 06 (d) A person may provide the disclosures required in (a) of this section 07 electronically, if 08 (1) the consumer affirmatively consents to electronic disclosure; and 09 (2) the disclosures are provided in a format that the consumer is able to 10 access at a later time such as through printing or storing the disclosures electronically. 11 (e) A person shall provide the disclosures required in (a) of this section in a 12 meaningful form and in a conspicuous, simple, direct, and understandable manner that 13 is designed to call attention to the information provided. 14 (f) A person shall obtain a written acknowledgement or, in the case of an 15 electronic disclosure provided in compliance with (d) of this section, a written or 16 electronic acknowledgement, by the consumer that the consumer received the 17 disclosures as required in this section. 18 (g) This section does not require that a person provide the disclosures required 19 in this section in advertisements that are of a general nature or that describe or list the 20 services or products offered by a financial institution or on behalf of a financial 21 institution. 22 (h) In this section, "meaningful form" means 23 (1) for other than an electronic form, a form of disclosure that is 24 provided to a consumer orally and in writing; 25 (2) for an electronic form, a disclosure that a consumer cannot 26 electronically bypass before purchasing insurance. 27 Sec. 21.36.169. Definitions for AS 21.36.164 - 21.36.169. In AS 21.36.164 - 28 21.36.169, unless the context otherwise requires, 29 (1) "consumer" means a person who obtains, applies to obtain, or is 30 solicited to obtain insurance from or on behalf of a financial institution; 31 (2) "financial institution" means a bank holding company under
01 12 U.S.C. 1841 (Bank Holding Company Act of 1956); a thrift holding company, 02 under 12 U.S.C. 1467(d) (Home Owners Loan Act), a bank, savings bank, savings and 03 loan association, or trust company, or any depository institution under 12 U.S.C. 04 1813(c)(1); and any other person authorized to take federally insured deposits or make 05 loans in the state; "financial institution" includes any employee or agent of a financial 06 institution and any non-depository affiliate or subsidiary of a financial institution but 07 only in the instances when the non-depository affiliate or subsidiary is soliciting the 08 sale or purchase of insurance recommended or sponsored by, on the premises of, or in 09 connection with a product offering of, the financial institution. 10 * Sec. 48. AS 21.36 is amended by adding a new section to read: 11 Sec. 21.36.355. Felony convictions involving dishonesty or breach of trust. 12 (a) A person who has a conviction for a felony involving dishonesty or a breach of 13 trust may not engage or participate in the business of insurance without receiving prior 14 written consent by the director as required under 18 U.S.C. 1033 and 1034 (Violent 15 Crime Control and Law Enforcement Act of 1994). 16 (b) A person who fails to seek prior written consent from the director under (a) 17 of this section is in violation of this chapter. 18 (c) A person who is engaged in the business of insurance may not knowingly 19 permit the participation in the business of insurance by a person who has been 20 convicted of a felony involving dishonesty or breach of trust except as allowed under 21 (a) of this section. 22 * Sec. 49. AS 21.36.430(a) is amended to read: 23 (a) A person transacting [AN INSURER OFFERING] insurance in this state 24 may not (1) refuse to issue or renew insurance coverage; (2) limit the scope of 25 insurance coverage; (3) cancel an existing policy of insurance; (4) [(3)] deny a 26 covered claim; or (5) [(4)] increase the premium on an insurance policy based on a 27 person's status as [IF THE REFUSAL, CANCELLATION, DENIAL, OR 28 INCREASE RESULTS ONLY FROM THE FACT THAT THE PERSON WAS] a 29 victim of domestic violence or as a provider of services to victims of domestic 30 violence. 31 * Sec. 50. AS 21.36.430 is amended by adding a new subsection to read:
01 (c) In this section, "domestic violence" means the occurrence of one or more 02 of the following by a current or former family member, household member, intimate 03 partner, or caretaker 04 (1) attempting to cause, causing, or threatening another person with 05 physical harm, severe emotional distress, psychological trauma, rape, or sexual 06 assault; 07 (2) engaging in a course of conduct or repeatedly committing acts 08 toward another person, including following the person without proper authority, under 09 circumstances that place the person in reasonable fear of bodily injury or physical 10 harm; 11 (3) subjecting another person to false imprisonment; or 12 (4) attempting to cause or causing damage to property so as to 13 intimidate or attempt to control the behavior of another person. 14 * Sec. 51. AS 21.89.080 is repealed and reenacted to read: 15 Sec. 21.89.080. Electronic submissions. The director may, by regulation or 16 by order, provide for the electronic submission of any information or written 17 submission required by this title, and for an electronic confirmation of a required 18 submission. 19 * Sec. 52. AS 21.90.900(24) is repealed and reenacted to read: 20 (24) "insurance producer" has the meaning given in AS 21.27.900; 21 * Sec. 53. AS 21.27.170, 21.27.405(c), 21.27.530(5), 21.27.900(14), and 21.27.900(16) are 22 repealed. 23 * Sec. 54. The uncodified law of the State of Alaska is amended by adding a new section to 24 read: 25 INDIRECT COURT RULE AMENDMENT. (a) The provisions of AS 21.27.110(h), 26 as repealed and reenacted by sec. 15 of this Act, have the effect of amending Rule 402, 27 Alaska Rules of Evidence, by making inadmissible in court, except under certain 28 circumstances, the statement of reasons for termination of an appointment under 29 AS 21.27.110. 30 (b) The provisions of AS 21.27.110(h), as repealed and reenacted by sec. 15 of this 31 Act, that relate to admissibility of evidence in court take effect only if (a) of this section
01 receives the two-thirds majority vote of each house required by art. IV, sec. 15, Constitution 02 of the State of Alaska. 03 * Sec. 55. The uncodified law of the State of Alaska is amended by adding a new section to 04 read: 05 TRANSITION: REGULATIONS. Notwithstanding secs. 57 and 58 of this Act, the 06 director of insurance may immediately proceed to adopt regulations necessary to implement 07 the changes made by this Act. The regulations take effect under AS 44.62 (Administrative 08 Procedure Act), but not before the effective date of the statutory change. 09 * Sec. 56. Sections 1, 9, 10, 51, and 55 of this Act take effect immediately under 10 AS 01.10.070(c). 11 * Sec. 57. Sections 44 - 50 of this Act take effect July 1, 2001. 12 * Sec. 58. Except as provided in secs. 56 and 57 of this Act, this Act takes effect January 1, 13 2002.