AS 21.27.010. License Required.

(a) Except as provided otherwise in this chapter, a person may not act as or represent to be an insurance producer, managing general agent, reinsurance intermediary broker, reinsurance intermediary manager, surplus lines broker, or independent adjuster in this state or relative to a subject resident, located, or to be performed in this state unless licensed under this chapter. A person may not act as or represent to be a managing general agent, reinsurance intermediary broker, or reinsurance intermediary manager representing an insurer domiciled in this state regarding a risk located outside this state unless licensed by this state.

(b) An insurance producer, a managing general agent, a reinsurance intermediary broker, a reinsurance intermediary manager, or a surplus lines broker may not solicit or take applications for, procure, place for others, or otherwise transact business for a kind or class of insurance for which the person is not licensed.

(c) A person who for a resident of this state, or for a resident of another jurisdiction from a place of business in this state, performs administrative functions, including claims administration and payment, marketing administrative functions, premium accounting, premium billing, coverage verification, underwriting authority, or certificate issuance only in regard to life insurance, health insurance, or annuities is not required to be licensed as a managing general agent if the person

(1) is registered under this chapter as a third-party administrator; or

(2) only investigates and adjusts claims and is licensed under this chapter as an independent adjuster.

(d) A licensee may not use a fictitious name or alias unless the licensee's legal name and fictitious name or alias are on the license.

(e) An employee of an insurer who responds to requests from existing policyholders on existing policies is not required to be licensed under this section if the employee

(1) is not directly compensated based on volume of premiums that may result from those services; and

(2) does not transact insurance.

(f) A person who performs management services under a written contract for an admitted insurer is not required to be licensed as a managing general agent if

(1) either

(A) the person is a United States manager of the United States branch of an alien admitted insurer; or

(B) the person's compensation is not based on the volume of premium written; and

(2) the person

(A) is a wholly-owned subsidiary of the admitted insurer;

(B) wholly owns the admitted insurer; or

(C) is a wholly-owned subsidiary of the insurance holding company subject to AS 21.22 that owns or controls the admitted insurer.

(g) A person who performs management services for an admitted reinsurer is not required to be licensed as a reinsurance intermediary manager if

(1) the person's compensation is not based on the volume of premium written and the person

(A) is a wholly-owned subsidiary of the admitted insurer;

(B) wholly owns the admitted insurer; or

(C) is a wholly-owned subsidiary of an insurance holding company subject to AS 21.22 that owns or controls the admitted insurer;

(2) the person is a United States manager of the United States branch of an alien admitted insurer; or

(3) the person is the manager of a group, association, pool, or organization of insurers that does joint underwriting and that is subject to examination by its resident insurance regulator in a state that

(A) the director has determined has enacted provisions substantially similar to those contained in this chapter; and

(B) is accredited by the National Association of Insurance Commissioners.

(h) This chapter does not apply to a person licensed to practice as an attorney at law while the person is acting as an attorney at law.

(i) A person licensed under AS 21.75 as an attorney-in-fact, or a person who meets the requirements for exemption from licensure under AS 21.75, is not required to be additionally licensed under this chapter while acting on behalf of subscribers and within the scope and authority of a subscribers agreement of a reciprocal insurer or exchange licensed under AS 21.75.

(j) This section does not apply to a person who

(1) is employed on salary or hourly wage by a person licensed under this section solely for the performance of accounting, clerical, stenographic, and similar office duties;

(2) only secures and forwards information required for the purposes of, and does not receive a commission for, any of the following services:

(A) performing administrative services related to

(i) group life insurance;

(ii) group property and casualty insurance;

(iii) group annuities;

(iv) group or blanket accident and health insurance;

(B) enrolling individuals under plans for the types of insurance or annuities specified in (A) of this paragraph;

(C) issuing certificates under plans for the types of insurance or annuities specified in (A) of this paragraph, or otherwise assisting in administering those plans;

(D) performing administrative services related to mass-marketed property and casualty insurance;

(3) is employed on salary by a licensee at the licensee's place of business, is supervised by and reports directly to a licensee in the firm, and who, after explaining that the matter must be reviewed by a licensee, may

(A) furnish premium estimates from published or printed lists of standard rates if the person does not advise, counsel, or suggest what coverage may be needed, or otherwise solicit insurance coverage;

(B) arrange appointments for a licensee if the person does not solicit insurance coverage;

(C) record information from an applicant or policyholder and complete for the licensee's personal review and signature, a certificate of insurance that is not a contract of insurance; the licensee's signature may be by facsimile;

(D) inform a policyholder of the type of coverage shown in the licensee's policy record if the person does not advise that an event or hypothetical event is or is not covered; or

(E) in the physical presence of the licensee, record information from an applicant or policyholder and complete for a licensee's personal review and personal signature, applications, binders, endorsements, or identification cards if the person discloses to the applicant or policyholder that the applicant or policyholder may review the matter with a licensee;

(4) is an employee of an insurer or an organization employed by an insurer and is engaged in the inspection, rating, or classification of risks, or in the supervision of the training of insurance producers and is not individually engaged in the sale, solicitation, or negotiation of insurance;

(5) advertises in this state through printed publications or electronic mass media, the distribution of which is not limited to residents of this state, if the person

(A) performs no other insurance-related activities in this state;

(B) does not intend to solicit in this state; and

(C) does not sell, solicit, or negotiate insurance of risks resident, located, or to be performed in this state;

(6) is not a resident of this state, but sells, solicits, or negotiates commercial property and casualty insurance for an insured with risks located in more than one state if the person is licensed as an insurance producer in the state where the insured maintains its principal place of business and the contract of insurance covers risks located in that state;

(7) is a salaried full-time employee who counsels or advises the person's employer regarding the insurance interests of the employer or of the subsidiaries or business affiliates of the employer, if the employee does not sell or solicit insurance or receive a commission from the sale or solicitation of insurance;

(8) is an employer or association or the employer's or association's officer, director, employee, or the trustee of an employee trust plan, if the person is not compensated, directly or indirectly, for transacting insurance and is engaged in the administration or operation of a plan offering employee benefits for the employer's or association's own employees, or the employees of its subsidiaries or affiliates; to qualify under this paragraph, the plan must include insurance for employees; or

(9) is an officer, director, or employee of an admitted insurer who does not receive a commission on policies written or sold to risks resident, located, or to be performed in this state if the officer's, director's, or employee's functions are executive, administrative, managerial, clerical, or a combination of these and are only indirectly related to the transaction of insurance; relate to underwriting or loss control; or are in the capacity of an agency supervisor where the activities are limited to providing technical assistance to insurance producers and whose activities do not include transacting insurance.

(k) In addition to the business activities expressly exempt from licensing under this section, the director may adopt regulations that exempt other activities from the licensing requirements of this section.

AS 21.27.020. General Qualifications For License.

(a) For the protection of the people of this state, the director may not issue or renew a license except in compliance with this chapter and may not issue a license to a person, or to be exercised by a person, found by the director to be untrustworthy, incompetent, or who has not established to the satisfaction of the director that the person is qualified under this chapter.

(b) To qualify for issuance or renewal of an individual or individual in the firm license, an applicant or licensee shall comply with this title and regulations adopted under AS 21.06.090 and

(1) shall be 18 years of age or older;

(2) if for a resident license, shall be a bona fide resident before issuance of the license and actually reside in the state;

(3) shall successfully pass an examination required under AS 21.27.060;

(4) shall be a trustworthy person;

(5) may not use or intend to use the license for the purpose principally of writing controlled business, as defined in AS 21.27.030 ;

(6) may not have committed an act that is a cause for denial, nonrenewal, suspension, or revocation of a license in this state or another jurisdiction.

(c) To qualify for issuance or renewal of a license as a firm insurance producer, a firm managing general agent, a firm reinsurance intermediary broker, a firm reinsurance intermediary manager, a firm surplus lines broker, or a firm independent adjuster, an applicant or licensee shall

(1) comply with (b)(4) and (5) of this section;

(2) maintain a lawfully established place of business in this state, except when licensed as a nonresident under AS 21.27.270 ;

(3) disclose to the director all owners, officers, directors, or partners of the firm;

(4) designate one or more compliance officers for the firm;

(5) provide to the director documents necessary to verify the information contained in or made in connection with the application; and

(6) notify the director, in writing, within 30 days of a change in the firm's compliance officer or of the termination of employment of an individual in the firm licensee.

(d) If the director finds that the applicant or licensee is qualified and that application, license, or renewal fees have been paid, the director may issue or renew the license.

(e) A licensed individual in the firm who changes employers remains licensed under this chapter pending the issuance of a new license if the licensee otherwise meets the requirements of this chapter.

(f) The director may adopt regulations establishing additional education or experience requirements for applicants or licensees under this chapter upon due consideration of the availability and accessibility of education and training opportunities in rural areas of the state. Regulations adopted under this subsection are subject to the following provisions:

(1) additional educational or experience requirements may not apply to a licensee who has been licensed by the division of insurance before January 1, 1980;

(2) a licensee shall complete at least 24 credit hours of approved continuing education courses during each two-year license period;

(3) if a licensee has accumulated more credit hours than required under (2) of this subsection by the end of the license period, a maximum of eight hours may be carried over to meet the requirements of (2) of this subsection in the next license period;

(4) a program or seminar may not be approved as an acceptable continuing education program unless it is a formal program of learning that contributes to the professional competence of the licensee; individual study programs or correspondence courses may be used to fulfill continuing education requirements if approved by the director;

(5) a nonresident licensee is exempt from the requirements of this subsection.

(g) The director shall establish a continuing education advisory committee. The committee consists of one representative from the division of insurance, one life and health insurance representative, one limited lines insurance representative, one property and casualty insurance representative, and one independent insurance adjuster representative. Each committee representative from the insurance industry must possess a valid, current insurance license issued in this state for the field to be represented.

(h) The director may make arrangements, including contracting with an outside agency, for administrative services.

AS 21.27.025. Required Notice By Licensee.

(a) A licensee shall notify the director within 30 days in writing of a change in residence, employment that is licensed under this chapter, place of business, legal name, fictitious name or alias, mailing address, or phone number. A licensee shall report in writing to the director any administrative action taken against the licensee by a governmental agency of another state or by a governmental agency of another jurisdiction within 30 days after the final disposition of the action. A licensee shall submit to the director the final order and other relevant legal documents in the action. A licensee shall report to the director any criminal prosecution of the licensee in this or another state or jurisdiction within 30 days after the date of filing of the criminal complaint, indictment, information, or citation in the prosecution. The licensee shall submit to the director a copy of the criminal complaint, calendaring order, and other relevant legal documents in the prosecution.

(b) A compliance officer shall notify the director in writing within 30 days of a termination of employment of a licensed individual in the firm. Notice required under this subsection must include

(1) the licensee's name;

(2) the firm's name and address;

(3) the date of hire, self-employment, or termination of the licensee; and

(4) other information required by the director.

(c) In addition to any other penalty provided by law, a failure to notify the director as required by this section is cause for denial, nonrenewal, suspension, or revocation of a license.

AS 21.27.030. Controlled Business Disqualification.

(a) The director may not issue an insurance producer, a managing general agent, or a surplus lines broker license to a person if the director has reasonable cause to believe that the applicant for the license would, during the 12-month period immediately following issuance of the license, earn or receive an aggregate amount in commission, service fees, brokerage, or other valuable consideration, directly or indirectly, by whatever name called, represented by the controlled business that exceeds 50 percent of the aggregate amount of compensation, commission, service fees, brokerage, or other valuable consideration represented by all other insurance business that would be procured by or through the applicant.

(b) The vendor who is title holder of property being sold under an installment purchase contract is not considered to be the owner of the property for the purposes of this section.

(c) A licensee may not earn or receive an aggregate amount in commission, service fees, brokerage, or other valuable consideration, directly or indirectly, by whatever name called, represented by the controlled business that exceeds 50 percent of the aggregate amount in compensation, commission, service fees, brokerage, or other valuable consideration represented by all other insurance business in a calendar year.

(d) In addition to any other penalty provided by law, a person who violates this section is subject to the penalties provided under AS 21.27.440.

(e) "Controlled business" means insurance procured or to be procured by or through the person upon

(1) the life, person, or property of the person or those of the person's spouse or relatives by blood or marriage to the second degree;

(2) the life, person, or property of the employer or firm of the person, or of an officer, director, stockholder, or member of the employer or firm of the person, other than members of mutual insurers, or of a spouse of the employer, officer, director, stockholder, or member;

(3) the life, person, or property of the ward or employees of the person, or upon persons or property under the person's supervision or control as trustee under an indenture or decree, or as administrator or executor of an estate.

AS 21.27.040. Application For License.

(a) Application for a license shall be made to the director upon forms prescribed by the director. As a part of or in connection with the application, the applicant shall furnish information concerning the applicant's identity, personal history, experience, business record, purposes, and other pertinent facts that the director may reasonably require. The applicant shall declare, subject to penalty of denial, nonrenewal, suspension, or revocation of a license issued by the director, that the statements made in or in connection with the application are true, correct, and complete to the best of the applicant's knowledge and belief. Payment of an application fee established under AS 21.06.250 must be submitted with the application.

(b) [Repealed, Sec. 47 ch 29 SLA 1987].

(c) In addition to any other penalty provided by law, a person wilfully misrepresenting a fact required to be disclosed in or in connection with the application or other information required by this section is subject to the penalties provided for under AS 21.27.440 .

(d) The director may require an applicant or licensee at any time, including at the time of license renewal, to supply current information of the type made in or supplemental to an application.

(e) As part of the application required by (a) of this section, an applicant shall furnish to the director a full set of fingerprints so that the director may obtain criminal justice information as provided under AS 12.62 about the applicant. The director shall submit the completed fingerprint card to the Department of Public Safety. The Department of Public Safety is authorized to submit the fingerprints to the Federal Bureau of Investigation for a national criminal history record check.

AS 21.27.050. One Filing of Personal Data Sufficient. [Repealed, Sec. 223 Ch 67 SLA 1992].

Repealed or Renumbered

AS 21.27.060. Examination of Applicants and Licensees.

(a) Except as provided in this chapter, an applicant for an individual license and a compliance officer applicant for a firm license shall, before the issuance of the license, personally take and pass, to the satisfaction of the director, an examination that tests the knowledge and competence of the applicant as to the applicant's duties and responsibilities as a licensee and the insurance statutes and regulations of the state.

(b) If the director determines that a licensee has violated this title or that a licensee has conducted affairs under the license that cause the director reasonably to desire further evidence of the qualifications of the licensee, the director may at any time require the licensee to personally take and pass, to the satisfaction of the director, an examination that tests the knowledge and competence of the licensee as to the licensee's duties and responsibilities as a licensee, or the insurance laws of the state.

(c) An individual who applies for an insurance producer license in this state who was previously licensed for the same lines of authority in that individual's prior home state is not required to pass the examination required by (a) of this section in order to secure the same authority in this state. The exemption available under this subsection applies only if the application is received within 90 days after the cancellation of the applicant's previous license in the applicant's prior home state and

(1) the applicant's prior home state verifies that, at the time of cancellation, the applicant held an insurance producer license that was in good standing in that state; or

(2) the insurance producer licensing database records for the prior home state that are maintained by the National Association of Insurance Commissioners or its affiliates or subsidiaries indicate that the applicant is or was licensed in good standing for the kind of license requested.

(d) This section does not apply to an applicant

(1) for a limited license under AS 21.27.150 (a)(1), (5), or (6); or

(2) who, at any time within the one-year period immediately preceding the date the current pending application is received by the division, had been licensed in good standing in this state under a license requiring substantially similar qualifications as required by the license applied for.

(e) The director may make available a printed manual specifying in general terms the subjects that may be covered in an examination for a particular license.

AS 21.27.070. Scope of Examination. [Repealed, Sec. 223 Ch 67 SLA 1992].

Repealed or Renumbered

AS 21.27.080. Examinations.

(a) The answers of the applicant to an examination shall be written by the applicant under the director's supervision, and the written examination may be supplemented by oral examination at the director's discretion.

(b) The director shall give examinations at the times and places that the director considers necessary to reasonably serve the convenience of the director, applicants, and licensees.

(c) The director may require a waiting period of reasonable duration before giving a new examination to an applicant who has failed to pass a previous similar examination.

(d) The director may make arrangements, including contracting with an outside testing service, for administering examinations and collecting a nonrefundable fee.

AS 21.27.090. , 21.27.095 Qualifications For Licensing; Licensing of General Agents. [Repealed, Sec. 223 Ch 67 SLA 1992].:Ao;21.27.095

Repealed or Renumbered

AS 21.27.100. Appointment of Insurance Producer, Managing General Agent, and Reinsurance Intermediary Manager; Acts of Agent.

(a) On forms prescribed by the director, an appointment shall be filed with the director at least 10 days before its proposed effective date by the following licensees:

(1) an admitted insurer appointing a managing general agent in this state or relative to a subject resident, located, or to be performed in this state;

(2) a managing general agent appointing an insurance producer as its subagent in this state or relative to subjects resident, located, or to be performed in this state;

(3) a domestic reinsurer appointing a reinsurance intermediary manager; and

(4) a reinsurance intermediary manager appointing an insurance producer as its subagent in this state.

(b) On forms prescribed by the director, an admitted insurer appointing an insurance producer as its agent in this state or relative to a subject resident, located, or to be performed in this state shall file written notice of appointment not later than 30 days from the date the written agency contract is executed or the first insurance application is submitted to the admitted insurer by the licensed insurance producer. If the licensed insurance producer has not received written acknowledgement of the appointment from the director within 45 days from the date the written agency contract is executed or the first insurance application is submitted to the admitted insurer by the insurance producer, whichever is later, the insurance producer shall immediately discontinue acting as an insurance producer on behalf of the insurer until an acknowledgement has been received.

(c) If the appointee is licensed, the director shall provide written acknowledgement of the appointment, including the effective date, to the person making the appointment, to the appointee, and to the insurer or reinsurer.

(d) The person making the appointment, the appointee, and the insurer shall review the acknowledgement for accuracy and advise the director of an error within 30 days for correction.

(e) An individual in a firm who acts solely on behalf of a firm that is appointed as an agent on behalf of an admitted insurer under this section may not be required to also have an appointment if the individual in the firm is licensed with that firm.

(f) An insurer may appoint an insurance producer to all or some insurers within the insurer's holding company system or group by the filing of a single appointment under this section.

(g) The authorized or apparently authorized acts on behalf of an appointing insurer of an insurance producer appointed under this section are considered the acts of that insurer.

AS 21.27.110. Term of Appointment.

(a) An appointment under AS 21.27.100 continues in force until the appointment is terminated in accordance with this section.

(b) If an appointment is terminated by an insurer, reinsurer, or authorized representative, the insurer, reinsurer, or authorized representative shall, on a form or in a format prescribed by the director, notify the director within 30 days after the date of termination of the appointment.

(c) If an appointment is terminated by the director, a written or an electronic notice of termination shall be given to the appointee, to the person that made the appointment, and, if different from the person making the appointment, to the insurer or reinsurer, at least 10 days before the effective date of the termination. The director shall send notification under this subsection to the latest address on record with the director.

(d) If, after termination and notice under (b) of this section, an insurer, reinsurer, or authorized representative discovers additional information showing that the appointee whose appointment was terminated has engaged in an activity identified in AS 21.27.410 during the period of the appointment, the insurer, reinsurer, or authorized representative shall, on a form or in a format prescribed by the director, promptly notify the director.

(e) Within 15 days after providing notification in accordance with (b) and (d) of this section, the insurer, reinsurer, or authorized representative shall mail a copy of the notification to the appointee at the last address on record with the director. The notice must be provided by certified mail, return receipt requested, postage prepaid, or by overnight delivery using a nationally recognized mail carrier, if the appointment was terminated for an activity identified in AS 21.27.410.

(f) Within 30 days after the appointee receives notification in accordance with (c) of this section, the appointee may file written comments concerning the substance of the notification with the director and must provide a copy of the written comments to the insurer, reinsurer, or authorized representative. The written comments filed with the director must be included with each report distributed or disclosed concerning a reason about the termination of the appointment.

(g) If requested by the director, an insurer, reinsurer, or authorized representative shall provide to the director additional information, documents, records, or other data pertaining to a termination or activity of a licensee under this title.

(h) A notice of termination submitted to the director under this section must include a statement of the reasons for the termination. A statement of the reasons for termination is confidential and not subject to inspection and copying under AS 40.25.110 . A statement of reasons for the termination may not be admitted as evidence in a civil action or an administrative proceeding against an insurer, reinsurer, or authorized representative by or on behalf of a person affected by the termination, except when the action or proceeding involves perjury, unsworn falsification, fraud, or failure to comply with this subsection.

(i) If an insurer, reinsurer, or authorized representative fails to report as required under this section or is found by a court to have knowingly or intentionally falsely made that report, the director may, after notice and hearing, suspend or revoke the license or certificate of authority of the insurer, reinsurer, or authorized representative and may impose a penalty in accordance with AS 21.27.440 .

(j) The director may require that an insurer renew an appointment annually and may require payment of a renewal fee under AS 21.06.250 for an appointment in effect on December 31 of the current year. If the director requires that an appointment be renewed or a renewal fee be paid, the director shall terminate the appointment if the renewal fees have not been received by the director on or before the close of business on March 1 of the renewal year.

AS 21.27.115. Lines of Authority.

If a person has met the applicable requirements of AS 21.27.020 and 21.27.270, the director shall issue a license for one or more of the following lines of authority:

(1) life insurance coverage on natural persons; in this paragraph, "life insurance coverage"

(A) includes benefits of endowment and annuities; and

(B) may include benefits in the event of death or dismemberment by accident and benefits for disability income;

(2) health insurance coverage for sickness, bodily injury, or accidental death; in this paragraph, "health insurance coverage" may include benefits for disability income;

(3) property insurance coverage for the direct or consequential loss for damage to property of every kind;

(4) casualty insurance coverage against legal liability, including that for death, injury, or disability or damage to real or personal property; in this paragraph, "casualty insurance" includes surety insurance as defined in AS 21.12.080 ;

(5) variable life and variable annuity products insurance coverage;

(6) personal lines property and casualty insurance coverage sold to individuals and families for primarily noncommercial purposes;

(7) limited lines credit insurance;

(8) any insurance for which a limited lines license may be issued under AS 21.27.150 .

AS 21.27.120. Revocation of Appointment. [Repealed, Sec. 223 Ch 67 SLA 1992].

Repealed or Renumbered

AS 21.27.130. Form and Content of Licenses.

(a) A license must be in the form the director prescribes and must set out

(1) the name and address of the licensee and, if the licensee is required to have a place of business, the physical address of the place of business;

(2) the type, class, and lines of authority the licensee is licensed to handle;

(3) the effective date and expiration date of the license;

(4) each condition, if any, under which the license is granted;

(5) the date of issuance of the license;

(6) each fictitious name and alias under which the licensee may do business; and

(7) other information required by the director.

(b) A license issued by the director does not in itself create any authority, actual, apparent, or inherent, in the holder of the license to represent or commit an insurer.

AS 21.27.140. Firm Licenses.

(a) A firm shall have a firm license, the scope of which includes all lines and classes of authority of each individual employee of the firm.

(b) A firm may not be licensed as an insurance producer, managing general agent, reinsurance intermediary broker, reinsurance intermediary manager, surplus lines broker, or independent adjuster, or transact insurance unless each individual employed as an insurance producer, managing general agent, surplus lines broker, trainee insurance producer, trainee independent adjuster, or independent adjuster by the firm is licensed as an individual in the firm. Each compliance officer of the firm shall be licensed as an individual in the firm for a specific line and class of authority. If there is more than one compliance officer, the combined authority of all compliance officers shall cover all the powers conferred by the firm's license.

(c) If the director determines under AS 21.06.170 - 21.06.240 that a firm knew or should have known of an act or representation made on the firm's behalf by a person not licensed as required by this chapter, the firm and the firm's compliance officer are subject to the penalties provided under AS 21.27.440 .

AS 21.27.150. Limited Licenses.

(a) The director may issue a

(1) travel insurance limited producer license to a person who sells transportation tickets of a common carrier of persons or property, who is appointed under AS 21.27.100 , and whose sole purpose is to be appointed by and act as an agent for transportation ticket policies of health insurance, baggage insurance on personal effects, and trip cancellation or trip interruption insurance;

(2) title insurance limited producer license to a person whose place of business is located in this state and whose sole purpose is to be appointed by and act on behalf of a title insurer;

(3) bail bond limited producer license to a person whose sole purpose is to be appointed by and act on behalf of a surety insurer pertaining to bail bonds;

(4) fraternal benefit society limited producer license to a person whose sole purpose is to be appointed by and act on behalf of a fraternal benefit society licensed under AS 21.84;

(5) motor vehicle rental agency limited producer license to a person and, subject to the approval of the director, to employees of the person licensed that the licensee authorizes to transact the business of insurance on the licensee's behalf if, as to an employee, the licensee complies with (D) of this paragraph and if the licensee

(A) rents to others, without operators,

(i) private passenger motor vehicles, including passenger vans, minivans, and sport utility vehicles; or

(ii) cargo motor vehicles, including cargo vans, pickup trucks, and trucks with a gross vehicle weight of less than 26,000 pounds that do not require the operator to possess a commercial driver's license;

(B) rents motor vehicles only to persons under rental agreements that do not exceed a term of 90 days;

(C) transacts only the following kinds of insurance:

(i) motor vehicle liability insurance with respect to liability arising out of the use of a vehicle rented from the licensee during the term of the rental agreement;

(ii) uninsured or underinsured motorist coverage, with minimum limits described in AS 21.89.020 (c) and (d) arising out of the use of a vehicle rented from the licensee during the term of the rental agreement;

(iii) insurance against medical, hospital, surgical, and disability benefits to an injured person and funeral and death benefits to dependents, beneficiaries, or personal representatives of a deceased person if the insurance is issued as incidental coverage with or supplemental to liability insurance and arises out of the use of a vehicle rented from the licensee during the term of the rental agreement;

(iv) personal effects insurance, including loss of use, with respect to damage to or loss of personal property of a person renting the vehicle and other vehicle occupants while that property is being loaded into, transported by, or unloaded from a vehicle rented from the licensee during the term of the rental agreement;

(v) towing and roadside assistance with respect to vehicles rented from the licensee during the term of the rental agreement; and

(vi) other insurance as may be authorized by regulation by the director;

(D) notifies the director in writing, within 30 days of employment, of the name, date of birth, social security number, location of employment, and home address of an employee authorized by the licensee to transact insurance on the licensee's behalf; and

(E) provides other information as required by the director;

(6) nonresident limited producer license to a person; a license that the director issues under this paragraph grants the same scope of authority as a limited lines producer license issued to the person by the person's home state;

(7) credit insurance limited producer license to a person who sells limited lines credit insurance;

(8) miscellaneous limited producer license to a person who transacts insurance in this state that restricts the person's authority to less than the total authority for a line of authority described in AS 21.27.115(1) - (6).

(b) [Repealed, Sec. 82 ch 81 SLA 2001].

AS 21.27.160. Scope of Licenses.

An insurance producer, managing general agent, reinsurance intermediary broker, reinsurance intermediary manager, surplus lines broker, or independent adjuster is only required to have one license inclusive of all kinds or combination of kinds or all classes or combination of classes of insurance the insurance producer, managing general agent, reinsurance intermediary broker, reinsurance intermediary manager, surplus lines broker, or independent adjuster is licensed to handle.

AS 21.27.170. Insurance Vending Machines License. [Repealed, Sec. 82 Ch 81 SLA 2001].

Repealed or Renumbered

AS 21.27.180. Scope of Broker License. [Repealed, Sec. 47 Ch 51 SLA 1990].

Repealed or Renumbered

AS 21.27.190. Bond.

(a) In addition to any other requirements in this title, a bond required under this title or an alternative indemnity permitted under this section shall meet the following requirements:

(1) it shall be continuous in form;

(2) it shall remain in force until the licensee is released from liability by the director or until cancelled by the issuer;

(3) without prejudice to any liability accrued before the effective cancellation, it may be cancelled if the director receives 60 days advance written notice;

(4) the amount required to be maintained must be maintained unimpaired; and

(5) it shall be in favor of insurers, insureds, and this state.

(b) A bond may only be issued by an admitted insurer authorized to transact surety insurance in this state, or by a surplus lines insurer on the most recent list of eligible surplus lines insurers published by the director, that is acceptable to the director.

(c) For a firm licensee, a single bond or an alternative indemnity permitted under this section may combine the sureties required

(1) by separate sections of this title; and

(2) for separate places of business.

(d) [Repealed, Sec. 83 ch 81 SLA 2001].

(e) Except as provided in this title, the director may adopt, by regulation, a deposit of cash, a certificate of deposit, or letter of credit as an alternative to a bond if the deposit of cash, certificate of deposit, or letter of credit meets the requirements of this section, other provisions of this title, and other requirements established by the director.

AS 21.27.200. , 21.27.210 Broker's Authority and Commissions; Agent-Broker Combinations. [Repealed, Sec. 223 Ch 67 SLA 1992].:Ao;21.27.210

Repealed or Renumbered

AS 21.27.240. - 21.27.260 Fee For and Custody of Solicitor's License; Limitations; Employer's Responsibility. [Repealed, Sec. 223 Ch 67 SLA 1992].:Ao;21.27.260

Repealed or Renumbered

AS 21.27.270. Licensing of Nonresidents.

(a) In accordance with P.L. 106-102 (Gramm-Leach-Bliley Act), the director shall issue a license to a nonresident license applicant on terms that are reciprocal with those of the applicant's home state. Notwithstanding any contrary provision of this chapter, the director may by order waive any license application requirement in this chapter to achieve reciprocity to license a nonresident in accordance with P.L. 106-102 (Gramm-Leach-Bliley Act).

(b) Unless the director denies or refuses to renew a license under AS 21.27.410, the director shall issue a nonresident producer, limited lines, surplus lines broker, managing general agent, reinsurance intermediary broker, or reinsurance intermediary manager license to a person who is not a resident of this state if

(1) the person is currently licensed and is in good standing in the person's home state; the director may verify the person's licensing status through the producer licensing database records maintained by the National Association of Insurance Commissioners or its affiliates or subsidiaries;

(2) the person has paid the fees required under AS 21.06.250 and has submitted to the director

(A) the license application the person submitted to the person's home state; or

(B) if the person is not a firm, a completed uniform application or, if a firm, the uniform business entity application; and

(3) the person's home state awards nonresident producer, limited lines, surplus lines, managing general agent, reinsurance intermediary broker, and reinsurance intermediary manager licenses to residents of this state on the same basis as does this state.

(c) Notwithstanding (b) of this section, the director may require a person applying for a

(1) nonresident license to furnish the person's fingerprints as required of a person applying for a license under AS 21.27.040 (e);

(2) surplus lines broker license under this section to have, and maintain while licensed in this state, the bond required of a person applying for a license under AS 21.27.790 (2); and

(3) nonresident license to comply with the premium fiduciary account requirements of AS 21.27.360 and the regulations adopted under that statute.

(d) A person licensed as a limited lines producer in the person's home state shall receive a nonresident limited lines producer license granting the same scope of authority as the license issued by the producer's home state.

(e) In addition to the other requirements of this chapter, a person may not be licensed as a nonresident licensee until the person files a power of attorney as follows:

(1) an applicant shall appoint the director as attorney to receive service of legal process issued against the licensee in this state upon a cause of action arising in this state or relative to a subject resident, located, or to be performed in this state; service upon the director as attorney shall constitute effective legal service upon the licensee; and

(2) the appointment shall be irrevocable for as long as there could be a cause of action against the licensee arising out of an insurance transaction in this state or relative to a subject resident, located, or to be performed in this state.

(f) Duplicate copies of legal process against a licensed or formerly licensed nonresident licensee shall be served upon the director either by a peace officer or through certified mail with return receipt requested. At the time of service, the plaintiff shall pay to the director a fee set under AS 21.06.250 .

(g) Upon receiving a service of process, the director shall immediately send one of the copies of the process by certified mail, return receipt requested, to the licensed or formerly licensed nonresident licensee at the last address of record filed with the director.

AS 21.27.275. Alien Licensees.

The director may issue a license authorized by this chapter to a nonresident of this state who does not have a home state if that person meets all the requirements of this chapter for that license applicable to a resident of this state applying for the same license.

AS 21.27.280. Director as Agent For Service of Process. [Repealed, Sec. 223 Ch 67 SLA 1992].

Repealed or Renumbered

AS 21.27.290. , 21.27.300. Adjuster's Qualifications; Contents of License. [Repealed, Sec. 47 Ch 51 SLA 1990].:Ao;21.27.300

Repealed or Renumbered

AS 21.27.310. , 21.27.320 Trainee Adjusters; Agent or General Agent as Adjuster; Nonresident Adjusters. [Repealed, Sec. 223 Ch 67 SLA 1992].:Ao;21.27.320

Repealed or Renumbered

AS 21.27.330. Place of Business.

(a) A person licensed under this chapter shall have and maintain at least one place of business that is physically accessible to the public in this state unless the person holds a nonresident license and principally conducts transactions in another state. However, the nonresident licensee must have at least one physically accessible place in the nonresident licensee's home state. The requirements of this subsection do not apply to a licensee who only conducts business in life or health insurance or annuities.

(b) If a licensee that is a firm transacts business at more than one place of business, the licensee shall pay a license fee for each place of business that transacts business in this state or relative to a subject resident, located, or to be performed in this state.

AS 21.27.340. Public Display of License.

The license of a licensee other than a licensee whose license has a scope of only life or health insurance or annuity shall be conspicuously displayed in that part of the place of business that is customarily open to the public.

AS 21.27.350. Records of Licensees.

(a) A licensee shall document each action taken in regard to an insurance transaction. The documentation must contain all notes, work papers, documents, and similar material, and be in sufficient detail that relevant events, the dates of those events, and all persons participating in those events can be identified. The documentation must include a record of each insurance contract procured, issued, or countersigned, together with the names of the insurers and insureds, the amount of premium paid or to be paid, and a statement of the subject of the insurance; the names of other licensees from whom business is accepted, and of persons to whom commissions or allowances are promised or paid; and a record of each investigation or adjustment undertaken or consummated, and a statement of the fee, commission, or other compensation received or to be received on account of the investigation or adjustment.

(b) A licensee shall keep at the licensee's place of business or at the place of business of an admitted insurer a complete record of transactions under the license. An admitted insurer shall maintain records received from a licensee as required by this section.

(c) The records of a particular transaction shall be retained and kept open for examination and inspection by the director at any business time during the five years immediately after the date of the completion of the transaction or 10 years for reinsurance transactions, unless the director orders a longer period of retention. If a licensee assumes the business of another licensee or former licensee by merger, purchase, or otherwise, the compliance officer of the assuming licensee firm shall provide to the director in writing each location where the assumed licensee's records are maintained by the assuming licensee during the period in which the records must be kept available and open to the inspection of the director. A formerly licensed person shall provide to the director in writing each location where records shall be maintained during the period in which the records of a particular transaction must be kept available and open to the examination and inspection of the director. A formerly licensed person may, with the permission of the director, arrange to have a current licensee or the home office of the last known insurer of each policyholder maintain the records open to the examination and inspection of the director during the period in which the records must be maintained.

(d) In addition to the record required under (a) of this section, a licensee shall have and maintain at the licensee's principal place of business current accounting and financial records maintained under generally accepted accounting principles.

(e) A licensee shall reply in writing within 10 working days to a records inquiry of the director. The director may inspect or request summary or detailed copies of records for examination by the division. Accounting and financial records inspected or examined under this section are confidential when in the possession of the division, but may be used by the director in a proceeding against the licensee. For purposes of this section, the records of a firm shall include and be considered the records of an individual licensee acting on behalf of the firm.

AS 21.27.360. Reporting and Accounting For Premiums and Premium Taxes and Fees.

(a) A licensee involved in the procuring or issuance of an insurance contract shall report to the insurer the exact amount of consideration charged as a premium for the contract. The amount charged shall be shown in the contract and in the records of the licensee.

(b) Except as provided under (h) of this section, all money, except that made payable to the insurer, representing premium taxes and fees, premiums, or return premiums received by the licensee shall be received by the licensee as a fiduciary and shall be promptly accounted for and paid to the person entitled to the money. Money held by the licensee as a fiduciary may not be commingled or otherwise combined with other money not held by the licensee as a fiduciary.

(c) In addition to any other penalty provided by law, a person who the director has determined has acted to divert or appropriate money held as a fiduciary for personal use shall be ordered to make restitution and shall be subject to suspension or revocation under AS 21.27.420 - 21.27.430 of all licenses and a civil penalty not to exceed $50,000 for each violation.

(d) A licensee may only commingle premium taxes and fees, premiums, and return premiums with additional money for the purpose of advancing premiums, establishing reserves for the payment of return premiums, or reserves for receiving and transmitting premium or return premium money.

(e) Money held by a licensee as a fiduciary may not be treated as a personal asset, as collateral for a personal or business loan, or as a personal asset or income on a financial statement, except that money held by the licensee as a fiduciary may be included in a financial statement of the licensee if clearly identified as assets held by the licensee as a fiduciary.

(f) This section does not apply to an individual in the firm who acts solely on behalf of a firm that maintains compliance with this section.

(g) [Repealed, Sec. 223 ch 67 SLA 1992].

(h) A licensee who transacts the business of insurance under a motor vehicle rental agency limited producer license under AS 21.27.150 (a)(7) is not required to hold money collected from a person for the purchase of rental motor vehicle insurance coverage in a separate fiduciary account if

(1) the fees for the rental insurance coverage are itemized and are a part of a rental motor vehicle transaction; and

(2) the insurer has given written consent that the money need not be segregated from other money received by the licensee and the consent is signed by an officer of the insurer.

(i) The director of insurance may adopt regulations to implement, define, and enforce this section.

AS 21.27.365. Deposit or Surety Bond in Place of Fiduciary Account. [Repealed, Sec. 83 Ch 81 SLA 2001].

Repealed or Renumbered

AS 21.27.370. Sharing Compensation.

(a) Except as provided in (c) and (d) of this section, a licensee may not compensate a person, other than a licensee who is acting within the scope of the person's license, for transacting insurance in this state or relative to a risk resident, located, or to be performed in this state.

(b) Except as provided in (c) and (d) of this section, a person may not be promised or paid, directly or indirectly, compensation for transacting a kind or class of insurance for which the person is not then licensed to transact or for insurance that the person is prohibited by this title from transacting.

(c) An unlicensed person who refers a customer or potential customer to a licensee and who does not discuss specific terms and conditions of a policy or give opinions or advice regarding insurance may be compensated for the referral, if the compensation

(1) for each referral is

(A) nominal;

(B) on a one-time basis; and

(C) fixed in amount by referral;

(2) does not depend on whether the customer or potential customer purchases the insurance; and

(3) is not contingent on the volume of insurance transacted.

(d) An insurer or insurance producer may compensate an insurance agency or another person if that person does not transact the business of insurance in this state and the payment does not violate AS 21.36.100 or 21.36.120.

(e) A person who is no longer licensed in this state may be paid renewal or other deferred compensation for selling, soliciting, or negotiating insurance in this state if the person

(1) was required to be licensed under this chapter at the time of the sale, solicitation, or negotiation; and

(2) held that required license.

(f) In addition to any other penalty provided by law, the director may suspend or revoke the license of a licensee participating in a violation of this section. The director may order a licensee who violates this section to pay a penalty of not more than three times the compensation promised or paid.

AS 21.27.380. License Renewal, Lapse, and Reinstatement.

(a) Except as provided in this title, the director may renew a license biennially on a date set by the director if the licensee continues to be qualified under this chapter and on or before the close of business of the renewal date, meets all renewal requirements established by regulation and pays the renewal license fees set under AS 21.06.250 for each license to the director. A licensee is responsible for knowing the date that a license lapses and for renewing a license before expiration. The director shall mail a renewal notice to the licensee's current address on file with the director 30 days before the renewal date.

(b) If a license is not renewed on or before the renewal date set by the director, the license lapses. A licensee may not act as or represent to be an insurance producer, managing general agent, reinsurance intermediary broker, reinsurance intermediary manager, surplus lines broker, or independent adjuster during the time a license has lapsed. The director may reinstate a lapsed license if the person continues to qualify for the license, pays renewal license fees, and a delayed renewal penalty. Reinstatement does not exempt a person from a penalty provided by law for transacting business while unlicensed. A license may not be renewed if it has lapsed for two years or longer.

(c) If a licensee does not wish to renew a license issued under this chapter, the licensee shall surrender the license to the director on or before the close of business of the renewal date in the manner prescribed in AS 21.27.460 .

(d) Notice of lapse from the director stating the reason for the lapse shall be mailed to a licensee at the licensee's last address on record with the director. The director shall obtain a certificate of mailing from the United States Postal Service.

(e) A trainee license issued to an insurance producer or an independent adjuster shall be for a term not to exceed 12 months and may not be renewed.

(f) A two-year trainee license issued to a managing general agent, reinsurance intermediary broker, reinsurance intermediary manager, or surplus lines broker may be renewed only once.

AS 21.27.390. Temporary License.

(a) The director may issue a temporary license only to a person who, except for experience, training, or the taking of an examination, meets all qualifications for a permanent license and if the person is

(1) the surviving spouse, next of kin, or the administrator or executor of a deceased licensed insurance producer or managing general agent;

(2) the spouse, next of kin, employee, or legal guardian of a licensed insurance producer or managing general agent who is disabled from transacting insurance because of sickness, mental illness, or injury;

(3) a surviving member, officer, or employee of a firm licensed as insurance producer or managing general agent upon the death of the compliance officer of the firm holding the same licenses as the firm; or

(4) the designee of a licensed insurance producer who enters active service in the armed forces of the United States, but only for insurance relating to insurers for whom the licensee was acting as an agent.

(b) Except as otherwise provided by law, a temporary license may not be in effect for more than 90 consecutive days and may not be renewed or reissued for more than one additional 90-day period.

(c) A temporary licensee may not be appointed by an insurer for which a licensed insurance producer or managing general agent was not appointed at the time of death or commencement of disability.

(d) This section does not apply to a temporary license issued under AS 14.43.148.

AS 21.27.400. Temporary License Limitations. [Repealed, Sec. 223 Ch 67 SLA 1992].

Repealed or Renumbered

AS 21.27.405. Hearing and Order On Violation.

(a) On the complaint of a person or on the motion of the director, the director may conduct an investigation to determine whether a person has violated this chapter.

(b) If the director determines that a person has violated this chapter, the director shall serve an order upon the person charged requiring that person to cease and desist from engaging in the act or practice. A person aggrieved by the cease and desist order may demand a hearing under AS 21.06.170 - 21.06.240.

(c) If the director believes that a person has violated a cease and desist order issued under (b) of this section, the director may certify the relevant facts to the superior court for proceedings under AS 44.62.590. In addition to the penalties and remedies provided for in AS 44.62.590, the superior court, upon finding that the cease and desist order has been violated, may order the violator to comply with the order, pay a penalty of not more than $100,000 for each violation, revoke or suspend the violator's license, and bar the violator from transacting the business of insurance in the future.

AS 21.27.410. Denial, Nonrenewal, Suspension, or Revocation of Licenses.

(a) The director may deny issuance of or not renew a license or may suspend or revoke a license issued under this chapter for any of the following:

(1) a cause for which issuance of the license or its renewal could have been denied had it then existed and been known to the director;

(2) a violation or participation in a violation of a provision of this title;

(3) wilful misrepresentation or fraud by the licensee or applicant to obtain or attempt to obtain a license;

(4) misappropriation, conversion to personal use, or illegally withholding money required to be held in a fiduciary capacity by a licensee or applicant;

(5) with intent to deceive, material misrepresentation of the terms or effect of an insurance contract by a licensee or applicant;

(6) twisting in violation of AS 21.36.050 or rebating in violation of AS 21.36.100 by a licensee or applicant;

(7) conviction of a felony;

(8) the conduct of affairs under a license if the licensee exhibits conduct considered by the director to reflect incompetence or untrustworthiness, or to be a source of potential injury and loss to the public;

(9) the licensee or applicant dealing with, or attempting to deal with, or to exercise a power relative to, insurance outside the scope of the license of the licensee or applicant;

(10) failure to surrender a license as required by this chapter or revocation of a license within the 12 months preceding the date a new application is received;

(11) failure to pass an examination required under this chapter;

(12) cheating on an examination required under this title;

(13) a licensee or applicant engaging in or about to engage in an unfair or fraudulent insurance transaction;

(14) suspension or revocation of a license in another jurisdiction;

(15) forgery of another's name to an application for insurance by a licensee or applicant;

(16) accepting insurance business from a person not licensed as required by this title if the applicant or licensee knew or should have known that the person was unlicensed.

(b) The license of a firm and its compliance officer may be denied, nonrenewed, suspended, or revoked for a violation or cause that relates to a person representing or acting on behalf of the firm.

AS 21.27.420. Procedure For Suspending, Revoking, or Conditioning a License.

(a) After a hearing under AS 21.06.170 - 21.06.240, if the director determines that a person has violated a provision of this title and that the person's license should be suspended or revoked, the director shall issue an order effective 10 days after the date of issuing that the license is suspended or revoked.

(b) After a hearing under AS 21.06.170 - 21.06.240, if the director determines the person has violated a provision of this title, the director may place conditions on a person's license if the director finds that the conditions will protect the public from injury or potential injury.

(c) With the consent of an applicant or licensee, the director may issue or renew a license with restrictions upon the scope of the person's license or may otherwise restrict or condition the activities of the licensee if the director determines that the person has violated the provisions of this title or to protect the public from injury or potential injury.

AS 21.27.430. Suspensions and Revocations.

(a) An order suspending a license shall specify the period during which the license is suspended. A period of suspension may not exceed 12 months.

(b) An order revoking a license shall specify the period during which the person may not seek to be licensed in this state or licensed relative to a subject resident, located, or to be performed in this state.

(c) In addition to any other penalty provided by law, a person whose license has been suspended or revoked shall pay a penalty equal to all or a portion of the compensation received during the suspension or revocation relating to the transaction of insurance.

AS 21.27.440. Penalties.

(a) In addition to any other penalty provided by law, a person that the director determines under AS 21.06.170 - 21.06.240 has violated the provisions of this chapter is subject to

(1) a civil penalty equal to the compensation promised, paid, or to be paid, directly or indirectly, to a person in regard to each violation;

(2) either a civil penalty of not more than $10,000 for each violation or a civil penalty of not more than $25,000 for each violation if the director determines that the person wilfully violated the provisions of this chapter; and

(3) denial, nonrenewal, suspension, or revocation of a license.

(b) An order issued by the director that levies a civil penalty shall specify the time period within which the civil penalty must be fully paid. The period may not be less than 15 days or more than one year after the date of the order. Upon failure to pay a civil penalty when due, the director shall revoke, without further hearing, all licenses of the licensee not already revoked.

AS 21.27.450. Fine in Lieu of Action Against the License. [Repealed, Sec. 223 Ch 67 SLA 1992].

Repealed or Renumbered

AS 21.27.460. Return of License.

(a) A license issued under this chapter is the property of the state. Within 10 days of an order or notice of nonrenewal, suspension, or revocation of the license, the licensee or other person having possession or custody of the license shall deliver it to the director either personally or by certified mail.

(b) If a license is lost, stolen, or destroyed while in the possession of the licensee or person, the director may accept, in lieu of the return of the license, an affidavit of the licensee or other person responsible for or involved in the safekeeping of the license concerning the facts of the loss, theft, or destruction.

(c) Upon a change in the state of residence, a place of business, a mailing address, or in the compliance officer of a firm, a license subject to the change shall be surrendered to the director within 10 days either personally or by certified mail and the division shall reissue the license reflecting the changes if the licensee continues to satisfy the qualifications under this chapter.

AS 21.27.470. - 21.27.520 Agent, Broker, Solicitor, Service Representatives, and Adjuster Defined; Exceptions From Definitions. [Repealed, Sec. 47 Ch 29 SLA 1987].:Ao;21.27.520

Repealed or Renumbered

AS 21.27.530. Insurance Producer Qualifications.

In addition to the general qualifications under AS 21.27.020 , to qualify for issuance or renewal of an insurance producer license, an applicant or licensee

(1) must possess the competence necessary to fulfill the responsibilities of an insurance producer;

(2) if previously licensed in good standing in this state as an insurance producer, must not have had a license suspended or revoked within the previous four calendar years;

(3) for a fraternal society limited insurance producer license, shall file with the application a statement by an officer or director of the appointing fraternal society that affirms that the society has satisfied itself that the applicant is trustworthy and competent to act as its insurance agent; and

(4) for a license with a scope that includes variable contracts, must either be currently registered with the federal Securities and Exchange Commission as a broker-dealer or personally take and pass, to the satisfaction of the director, tests of the knowledge and competence of the applicant concerning securities;

(5) [Repealed, Sec. 82 ch 81 SLA 2001].

AS 21.27.540. Trainee Insurance Producers.

(a) Except for life, health, and annuity insurance, a person who has not passed the examinations required under AS 21.27.060 , but who otherwise meets the requirements of AS 21.27.530 , may be employed by a licensed insurance producer as a trainee insurance producer.

(b) Before a trainee may transact insurance, the licensed insurance producer employing the trainee insurance producer shall submit to the director the application of the trainee insurance producer, with the fee set under AS 21.06.250 , and receive the trainee insurance producer license.

(c) The director shall terminate a trainee insurance producer license unless the individual has

(1) not later than four months after the effective date of the trainee insurance producer license, complied with the insurance producer licensing requirements of AS 21.27.060 concerning the insurance laws and regulations of this state; and

(2) within eight months after the effective date of the trainee insurance producer license, complied with the insurance producer licensing requirements of AS 21.27.060 concerning the knowledge and competence of the licensee and the licensee's duties and responsibilities as a licensee.

(d) Upon satisfying the requirements of (c) of this section, a trainee insurance producer shall apply within 30 days for an insurance producer license.

(e) A licensed trainee insurance producer

(1) shall at all times be working at the direction and under the supervision of the employing licensed insurance producer; file and record documentation must reflect the direction and supervision, and activities must be in the name of the employing licensed insurance producer, who is responsible for all actions of the trainee insurance producer;

(2) is restricted to assisting the employing licensed insurance producer to prepare applications; binders; certificates of insurance; schedules of equipment, vehicles, drivers; loss notices to insurers; and invoices; and to performing clerical functions for which a license is not required; file and record documentation must reflect compliance with these restrictions;

(3) may not transact business away from the place of business with clients or insurers unless a licensed insurance producer physically accompanies the trainee.

(f) In addition to any other penalty provided by law, the director shall revoke the trainee license of a trainee insurance producer that the director determines has violated the provisions of this section. A licensee or other person having possession or custody of the license shall immediately surrender the license to the director either personally or by certified mail.

(g) In addition to any other penalty provided by law, if the director determines under AS 21.06.170 - 21.06.240 that the employing licensed insurance producer knew of or should have known that a trainee insurance producer violated this section, the employing licensed insurance producer and firm, and the compliance officer, if any, are subject to the penalties provided under AS 21.27.440 .

AS 21.27.550. Appointment of Insurance Producer as An Agent.

(a) A person may not act as or represent to be a representative of, authorized or appointed agent of, or other term implying a contractual relationship with a particular admitted insurer, or accept applications on behalf of an admitted insurer, unless the person is licensed as an insurance producer under this chapter and is or becomes an appointed agent of the admitted insurer under AS 21.27.100 .

(b) An admitted insurer or managing general agent of an admitted insurer may not enter into an agency agreement with an insurance producer unless the managing general agent and the insurance producer are licensed under this chapter and there is in effect a written agency agreement that specifically sets out the duties, functions, powers, authority, and compensation of all parties to the contract. The written agreement shall be kept in the permanent records of the insurer or managing general agent, if any, and the insurance producer, and be open to inspection by the director.

(c) All money collected for the account of an insurer shall be held by the insurance producer as a fiduciary.

(d) An agency agreement may not be assigned in whole or in part by the insurance producer.

(e) If the agency agreement permits the insurance producer to settle a claim on behalf of the insurer

(1) a claim must be reported to the insurer within 30 days;

(2) a copy of the claim file shall be sent to the insurer;

(3) all insurance claim files shall be the property of the insurer or managing general agent, if any, and insurance producer, but upon an order of liquidation of the insurer, the files shall become the sole property of the insurer or the insurer's estate; the insurance producer shall have reasonable access to and the right to copy the files on a timely basis.

(f) An insurance producer is subject to the unfair trade practice and fraud provisions under AS 21.36.

(g) The insurance producer may not

(1) bind reinsurance or retrocessions on behalf of the insurer;

(2) commit the insurer to participate in insurance or reinsurance syndicates;

(3) appoint an agent or subagent;

(4) jointly employ an individual who is employed by the insurer or by the managing general agent; or

(5) delegate insurance producer authority to another person.

(h) Except as provided under AS 21.27.560 , an agency appointment may not extend, directly or indirectly, to a client for whom the insurance producer is a producing broker or for whom insurance is exported to nonadmitted insurers under AS 21.34.

(i) A reinsurance intermediary manager may not enter into an agency agreement with an insurance producer unless both parties are licensed under this chapter and there is in effect a written agency agreement that specifically sets out the duties, functions, powers, authority, and compensation of all parties to the agreement. The written agreement shall be kept in the permanent records of the reinsurance intermediary manager, the reinsurer, and the insurance producer, and be open to inspection by the director. A written agreement must contain the following minimum provisions:

(1) money collected for the account of a reinsurer must be held by the insurance producer as a fiduciary;

(2) the agreement may not be assigned in whole or in part by the insurance producer;

(3) the agreement may not permit the insurance producer to settle claims on behalf of the reinsurer or reinsurance intermediary manager; and

(4) the insurance producer may not

(A) jointly employ an individual who is employed with the reinsurer or reinsurance intermediary manager; or

(B) delegate insurance producer authority to another person.

AS 21.27.560. Appointment of Insurance Producers as Brokers.

(a) A client who appoints an insurance producer as its broker in this state or relative to a subject resident, located, or to be performed in this state shall execute a written contract that specifically sets out the duties, functions, powers, authority, and compensation of the insurance producer, if the broker is compensated by a fee paid by the client or by a combination of a fee paid by a client and a commission paid by an insurer with which coverage has been placed. The written contract shall be kept in the permanent records of the insurance producer and be open to inspection by the director.

(b) The insurance producer may not knowingly accept payment of a premium for coverage until the coverage has been authorized by the insurer. This subsection does not apply to renewal of existing coverage placed by the insurance producer or to a premium deposit for the purchase of insurance. A premium deposit shall be returned to the client if coverage is not obtained within 10 working days.

(c) An insurance producer appointed as a client's broker may only receive compensation if the compensation is a

(1) fee that requires the insurance producer to offset or reimburse the client for the full amount of a commission earned by the insurance producer;

(2) combination of a fee paid by a client and a commission paid by an insurer with which coverage is placed that may offset or reimburse a client for all or part of a commission earned by the insurance producer if the amount of the commission is disclosed to the client; or

(3) commission paid by an insurer with which coverage has been placed.

(d) A contract between a client and an insurance producer may not be assigned in whole or in part by the insurance producer.

(e) An insurance producer appointed as a broker by a client may act as an appointed agent of an admitted insurer and may accept an application, bind coverage, and collect a premium from the client on behalf of the admitted insurer.

(f) A controlling insurance producer may not be appointed as a broker by a client in this state or relative to a subject resident, located, or to be performed in this state unless, in a form acceptable to the director, the controlling insurance producer has disclosed in writing to the client the relationship between the controlling insurance producer and the controlled insurer, each client has acknowledged receipt of the disclosure, and a copy of the acknowledged disclosure is maintained by the controlling insurance producer in its records. The records shall be available for inspection by the director.

(g) Money paid by a client to an insurance producer for insurance premiums shall be held by the insurance producer as a fiduciary.

(h) An insured shall be entitled to coverage or a return premium and the premium shall be considered received by the insurer if the premium payment made to the insurance producer was, at the time made, designated for specific coverage, and the insurer accepted or acknowledged coverage by issuing a policy binder or other evidence of temporary insurance, or the insurance producer received information from the insurer in the normal course of business that the insurance had been granted.

(i) Except as provided under (c) and (e) of this section, this section does not alter the common law of agency as applied to transactions under this title.

AS 21.27.570. Operating Requirements For Controlling Insurance Producers.

(a) If the aggregate amount of gross written premium on business placed by a controlling insurance producer exceeds five percent of the admitted assets of the controlled insurer for a calendar year as reported in the insurer's most recent financial statement filed with the director, the controlling insurance producer may not place business with the controlled insurer and the controlled insurer may not accept business from the controlling insurance producer unless a written contract is in effect between the parties that

(1) establishes the responsibilities of each party, indicates each party's share of responsibility for each particular function, and specifies the division of responsibilities;

(2) has been approved by the board of directors of the controlled insurer;

(3) contains the following minimum provisions:

(A) the controlled insurer may terminate the contract for cause upon written notice sent by certified mail to the controlling producer and shall suspend the authority of the controlling insurance producer to write business during a dispute regarding the cause for termination;

(B) the controlling insurance producer shall render accounts to the controlled insurer detailing all transactions, including information in the accounts necessary to support compensation, commissions, charges, and other fees received by, or owing to, the controlling producer;

(C) the controlling insurance producer shall remit money due under the contract to the controlled insurer at least monthly;

(D) premiums or installments collected shall be due not later than 90 days after the effective date of coverage placed with the controlled insurer;

(E) money collected for the account of a controlled insurer shall be held by the controlling insurance producer as a fiduciary, except a controlling insurance producer not required to be licensed under this chapter shall act as a fiduciary in compliance with the requirements of its domiciliary jurisdiction;

(F) all payments on behalf of the controlled insurer shall be held by the controlling insurance producer as a fiduciary;

(G) the controlling insurance producer shall maintain separate records for each controlled insurer in a form usable by the controlled insurer; the controlled insurer or its authorized representative shall have the right to audit and the right to copy all accounts and records related to the controlled insurer's business; the director, in addition to authority granted in this title, shall have access to all books, bank accounts, and records of the controlling insurance producer in a form usable to the director;

(H) the contract may not be assigned in whole or in part by the controlling insurance producer;

(I) the controlled insurer shall provide, and the controlling producer shall follow, written underwriting standards, rules, procedures, and manuals that must include the conditions for acceptance or rejection of risks, including types of risks that may be written, maximum limits of liability, applicable exclusions, territorial limitations, policy cancellation provisions, the maximum policy term, the rating system, and basis of the rates to be charged;

(J) the underwriting standards, rules, procedures, and manuals shall be the same as those applicable to comparable business placed with the controlled insurer by licensees other than the controlling licensee;

(K) the rates and terms of the controlling insurance producer's compensation including commissions, charges, and other fees may not be greater than those applicable to comparable business placed with the controlled insurer by licensees other than the controlling licensee;

(L) the controlled insurer shall establish a limit, that may be different for each kind or class of business, on the amount of premium that the controlling insurance producer may place with the controlled insurer in relation to the controlled insurer's surplus and total writings;

(M) the controlled insurer shall notify the controlling insurance producer if an applicable limit is approached and the controlling insurance producer may not place and the controlled insurer may not accept business if the limit under (L) of this paragraph has been reached;

(N) if the contract provides that the controlling insurance producer, on insurance placed with the controlled insurer, is to be compensated contingent upon the controlling insurer's profits on the placed insurance, the contingent compensation may not be determined or paid until

(i) at least five years after the premiums are earned on casualty business and at least one year after the premiums are earned on any other insurance;

(ii) a later period established by the director for specified kinds or classes of insurance; and

(iii) not until the profits have been verified under (b) of this section;

(O) the controlling insurance producer may negotiate but may not bind reinsurance on behalf of the controlled insurer on insurance that the controlling insurance producer places with the controlled insurer, except that the controlling insurance producer may bind facultative reinsurance contracts under obligatory agreements if the contract with the controlled insurer contains reinsurance underwriting guidelines including, for both reinsurance assumed and ceded, a list of reinsurers with which automatic agreements are in effect, the coverage and amounts or percentages that may be reinsured, and commission schedules; and

(4) provides that the controlled insurer has an audit committee composed of independent members of the board of directors that meet at least annually with management, the insurer's independent certified public accountants, and an independent actuary specialist acceptable to the director to review the adequacy of the insurer's reserves for losses incurred and outstanding.

(b) In addition to any other required loss reserve certification, the controlled insurer shall annually obtain the opinion of an independent qualified actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the controlling insurance producer. The controlled insurer shall file with the director on or before April 1 of each year an opinion of an independent actuary attesting to the adequacy of the reserves for losses incurred and outstanding and reporting the loss ratios for each kind and class of business placed with the controlled insurer by the controlling producer.

(c) The controlled insurer shall annually report by kind and class of insurance in a form acceptable to the director the amount of compensation paid to the controlling producer, the percentage the compensation represents to the net premiums written, the amount of compensation paid to uncontrolling producers, and the percentage the compensation represents to the net premiums written.

(d) A controlling insurance producer may be examined by the director as if it were the controlled insurer.

(e) If the conservator, rehabilitator, or liquidator of a controlled insurer or formerly controlled insurer has reason to believe that the controlled insurer or formerly controlled insurer suffered loss or damage arising out of a failure to comply with this section by the controlling producer or another person, the conservator, rehabilitator, or liquidator may maintain a civil action for recovery of damages or other relief for the benefit of the controlled insurer or its estate.

(f) In addition to any other liability and without intent to limit in any manner the rights of policyholders, claimants, auditors, creditors, or third parties, if the director determines after a hearing under AS 21.06.170 - 21.06.240 that a controlling insurance producer caused losses arising out of a violation of this section to a controlled insurer, the director may order the controlling insurance producer to make restitution to the controlled insurer, the rehabilitator, or the liquidator of the controlled insurer for the loss.

(g) In addition to any other penalty provided by law, a person who violates this section is subject to the penalties provided under AS 21.27.440 and a controlled insurer's certificate of authority may be suspended or revoked. The director may also order the controlling producer to cease placing business with the controlled insurer.

(h) This section does not apply to

(1) a person appointed to act on behalf of the controlled insurer as a managing general agent under this chapter;

(2) a person who receives no compensation based upon the amount of premiums written with the controlled insurer and who places insurance only with the controlled insurer, only with the controlled insurer and an admitted member or admitted members of the insurer's holding company system, or only with the controlled insurer's parent, affiliate, or subsidiary if admitted in this state;

(3) a person who does not accept insurance placements directly from an insured and who only accepts insurance placements from a nonaffiliated subagent;

(4) a controlled insurer and its controlling insurance producer if, except for insurance written through a residual market facility under this title, insurance placements are accepted only from a controlling producer, an insurance producer controlled by the controlled insurer, or a producer that is a subsidiary of the controlled insurer;

(5) a risk retention group under 15 U.S.C. 3901; or

(6) a risk apportionment plan under AS 21.39.150 or an assigned risk pool under AS 21.39.155 .

AS 21.27.590. Managing General Agent Qualifications.

(a) In addition to the general qualifications under AS 21.27.020 , to qualify for issuance or renewal of a managing general agent license, an applicant or licensee shall have at least three years active working experience within the previous 10 calendar years in insurance administrative functions which, in the director's opinion, exhibits the applicant's ability to competently perform the administrative functions for all kinds and classes of insurance applied for.

(b) The director may require that a managing general agent maintain

(1) a bond in an amount acceptable to the director and conditioned in that the managing general agent will conduct business as required by this title; and

(2) an errors and omissions insurance policy acceptable to the director.

AS 21.27.600. Trainee Managing General Agents.

(a) An individual licensed in this state as an insurance producer who does not have the experience required to be licensed as a managing general agent, but who otherwise meets the requirements of AS 21.27.590, may be employed by a licensed managing general agent as a trainee managing general agent, subject to the provisions of this section.

(b) Before an individual may transact insurance as a managing general agent, a managing general agent employing the trainee managing general agent shall submit to the director the application of the trainee managing general agent, with the fee set under AS 21.06.250 , and receive the trainee managing general agent license.

(c) Upon satisfying the managing general agent experience requirement, a trainee managing general agent shall apply within 30 days for a managing general agent license.

(d) A trainee managing general agent shall at all times be working at the direction and under the supervision of the employing licensed managing general agent, and file and record documentation must reflect the direction and supervision. The activities of a managing general agent trainee must be in the name of the employing managing general agent. A managing general agent who employees a trainee is responsible for all actions of the trainee managing general agent.

(e) A trainee managing general agent is restricted to assisting the employing licensed managing general agent in preparing applications; binders; certificates of insurance; schedules of equipment, vehicles, drivers; loss notices to insurers; and invoices; and to performing clerical functions for which a license is not required. The file and record documentation must reflect compliance with this subsection.

(f) A trainee managing general agent may not transact business away from the place of business with clients or insurers unless a licensed managing general agent physically accompanies the trainee.

(g) In addition to any other penalty provided by law

(1) the director shall revoke the trainee license of a trainee managing general agent who the director determines has violated the provisions of this section; a licensee or other person having possession or custody of the license shall immediately surrender the license to the director either personally or by certified mail;

(2) if the director determines under AS 21.06.170 - 21.06.240 that the employing managing general agent knew of or should have known that a trainee managing general agent violated this section, the employing managing general agent and firm, and the compliance officer, if any, are subject to the penalties provided under AS 21.27.440 .

AS 21.27.610. Authority of Managing General Agents.

A managing general agent has only the authority consistent with this title that is conferred by an admitted insurer. A managing general agent, resident or nonresident, qualified and licensed under this chapter, may exercise the powers conferred by this title upon insurance producers and independent adjusters only for the kinds or classes of insurance and within the scope authorized by the insurer appointing the managing general agent.

AS 21.27.620. Operating Requirements For Managing General Agents; Actions For Loss.

(a) An insurer may not transact business with a managing general agent unless

(1) the insurer holds a certificate of authority in this state;

(2) the managing general agent is licensed under this chapter or, when the managing general agent is operating only for a foreign insurer, is licensed by its resident insurance regulator in a state that the director has determined has enacted provisions substantially similar to those contained in this chapter and the state is accredited by the National Association of Insurance Commissioners;

(3) a written contract is in effect between the parties that establishes the responsibilities of each party, indicates both party's share of responsibility for a particular function, and specifies the division of responsibilities;

(4) a written contract between an insurer and a managing general agent contains the following provisions:

(A) the insurer may terminate the contract for cause upon written notice sent by certified mail to the managing general agent and may suspend the underwriting authority of the managing general agent during a dispute regarding the cause for termination;

(B) the managing general agent shall render accounts to the insurer detailing all transactions and remit all money due under the contract to the insurer at least monthly;

(C) all money collected for the account of an insurer shall be held by the managing general agent as a fiduciary;

(D) all payments on behalf of the insurer shall be held by the managing general agent as a fiduciary;

(E) the managing general agent may not retain more than three months estimated claims payments and allocated loss adjustment expenses;

(F) the managing general agent shall maintain separate records for each insurer in a form usable by the insurer; the insurer or its authorized representative shall have the right to audit and the right to copy all accounts and records related to the insurer's business; the director, in addition to authority granted in this title, shall have access to all books, bank accounts, and records of the managing general agent in a form usable to the director;

(G) the contract may not be assigned in whole or in part by the managing general agent;

(H) if the contract permits the managing general agent to do underwriting, the contract must include the following:

(i) the managing general agent's maximum annual premium volume;

(ii) the rating system and basis of the rates to be charged;

(iii) the types of risks that may be written;

(iv) maximum limits of liability;

(v) applicable exclusions;

(vi) territorial limitations;

(vii) policy cancellation provisions;

(viii) the maximum policy term; and

(ix) that the insurer shall have the right to cancel or not renew a policy of insurance subject to applicable state law;

(I) if the contract permits the managing general agent to settle claims on behalf of the insurer, the contract must include the following:

(i) written settlement authority must be provided by the insurer and may be terminated for cause upon the insurer's written notice sent by certified mail to the managing general agent or upon the termination of the contract, but the insurer may suspend the settlement authority during a dispute regarding the cause of termination;

(ii) claims shall be reported to the insurer within 30 days;

(iii) a copy of the claim file shall be sent to the insurer upon request or as soon as it becomes known that the claim has the potential to exceed an amount determined by the director or exceeds the limit set by the insurer, whichever is less, involves a coverage dispute, may exceed the managing general agent's claims settlement authority, is open for more than six months, involves extra contractual allegations, or is closed by payment in excess of an amount set by the director or an amount set by the insurer, whichever is less;

(iv) each party shall comply with unfair claims settlement statutes and regulations;

(v) transmission of electronic data at least monthly if electronic claim files are in existence; and

(vi) claim files shall be the property of both the insurer and managing general agent; upon an order of liquidation of the insurer, the files shall become the sole property of the insurer or the insurer's estate; the managing general agent shall have reasonable access to and the right to copy the files on a timely basis;

(J) if the contract provides for sharing of interim profits by the managing general agent and the managing general agent has the authority to determine the amount of the interim profits by establishing loss reserves, by controlling claim payments, or in any other manner, interim profits may not be paid to the managing general agent until

(i) one year after they are earned for property insurance business and five years after they are earned on casualty business;

(ii) a later period established by the director for specified kinds or classes of insurance; and

(iii) not until the profits have been verified under (d) of this section;

(K) if the insurer is domiciled in this state or the managing general agent has a place of business in this state, a copy of the contract must be filed with and approved by the director at least 30 days before the managing general agent transacts business on behalf of the insurer; if the insurer is not domiciled in this state or the managing general agent transacts business relative to a subject resident, located, or to be performed in this state from a place of business not physically located in this state, a copy of the contract required in this section must be filed with and approved by the director at least 30 days before the managing general agent transacts business on behalf of the insurer in this state or relative to a subject resident, located, or to be performed in this state if the insurer or the managing general agent are domiciled in a state not accredited by the National Association of Insurance Commissioners; and

(L) if the contract is not required to be approved in advance by the director, the insurer shall provide written notification to the director within 30 days of the entry into or termination of a contract with a managing general agent; the notice must include a statement of duties to be performed by the managing general agent on behalf of the insurer, the kinds and classes of insurance for which the managing general agent has authorization to act, and other information required by the director.

(b) The managing general agent may not

(1) bind reinsurance or retrocessions on behalf of the insurer, except that the managing general agent may bind facultative reinsurance contracts under obligatory agreements if the contract with the insurer contains reinsurance underwriting guidelines including, for both reinsurance assumed and ceded, a list of reinsurers with which automatic agreements are in effect, the coverage and amounts or percentages that may be reinsured, and commission schedules;

(2) commit the insurer to participate in insurance or reinsurance syndicates;

(3) appoint a subagent unless the scope of the subagent's license as an insurance producer includes the kinds and classes of insurance for which the subagent is appointed;

(4) pay or commit the insurer to pay a claim, net of reinsurance, the amount of which exceeds one percent of the insurer's policyholder's surplus as of December 31 of the last completed calendar year without the prior written approval of the insurer for the settlement and the approval is received after the insurer has been notified in writing that the claim settlement will exceed one percent of the insurer's policyholder's surplus as of December 31 of the last completed calendar year;

(5) collect a payment from a reinsurer or commit the insurer to a claim settlement with a reinsurer without prior written approval of the insurer, but if prior written approval is given, a complete report must be forwarded to the insurer within 30 days;

(6) permit a subagent to serve on the insurer's board of directors;

(7) jointly employ an individual who is employed with the insurer; or

(8) delegate managing general agent authority to another person.

(c) In a form acceptable to the director, a managing general agent shall annually provide and an insurer shall annually obtain a copy of certified financial statements of each managing general agent with which the insurer has done business. The financial statements shall be prepared by an independent certified public accountant if the managing general agent, with or without authority, either separately or with affiliates, directly or indirectly produces or underwrites an amount of gross written premium equal to or more than five percent of the policy holder's surplus in a quarter or year, as reported in the insurer's last annual statement.

(d) In addition to any other required loss reserve certification, if a managing general agent establishes loss reserves, the insurer shall annually obtain the opinion of an independent qualified actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the managing general agent. The insurer retains an independent responsibility to determine the adequacy of its loss reserves, including those established by its managing general agents.

(e) An insurer shall at least semiannually conduct an on-site review of the underwriting and claims processing operations of the managing general agent if the managing general agent, with or without authority, either separately or with affiliates, directly or indirectly produces or underwrites an amount of gross written premium equal to or more than five percent of the policy holder's surplus in a quarter or year, as reported in the insurer's last annual statement.

(f) An insurer shall review its books and records quarterly to determine if a person or insurance producer has acted as its managing general agent. If an insurer determines that a person or insurance producer has acted as its managing general agent, the insurer shall promptly notify the person or insurance producer and the director of the determination and the insurer and person or insurance producer must fully comply with the provisions of this chapter within 30 days.

(g) An insurer may not appoint to its board of directors an officer, director, employee, subagent, insurance producer, or controlling shareholder of its managing general agent.

(h) The actual or apparently authorized acts of the managing general agent are considered the acts of the insurer upon whose behalf it is acting.

(i) A managing general agent may be examined by the director as if it were the insurer.

(j) If the director determines after a hearing under AS 21.06.170 - 21.06.240 that a managing general agent caused loss or damage arising out of a violation of AS 21.27.590 - 21.27.630 to an insurer, the director may order the managing general agent to make restitution to the insurer, receiver, rehabilitator, or liquidator of the insurer for the loss. Restitution ordered under this subsection is in addition to any other liability of the managing general agent and does not affect the rights of a policy holder, claimant, creditor, or third party. The director may, at the request of the insurer, maintain or bring a civil action brought by or on behalf of the insurer and its policyholders and creditors for recovery of compensatory damages for the benefit of the insurer and its policyholders and creditors or seek other appropriate relief. If an order of rehabilitation or liquidation of the insurer has been entered under AS 21.78, the receiver appointed under the order determines that a person has not materially complied with AS 21.27.590 - 21.27.630 or an order of the director, and the insurer suffers loss or damage from the noncompliance, the receiver may bring a civil action for the recovery of damages or other appropriate sanctions for the benefit of the insurer.

(k) In addition to any other penalty provided by law, a person who violates this section is subject to the penalties provided under AS 21.27.440 and an insurer's certificate of authority may be suspended or revoked.

( l ) In this section, "transact" has the meaning given in AS 21.90.900.

AS 21.27.630. Registration Required.

(a) A person may not act as or represent to be a third-party administrator in this state or relative to a subject resident, located, or to be performed in this state, unless registered under this chapter or in another jurisdiction under AS 21.27.650 . A person may not act as or represent to be a third-party administrator representing an insurer domiciled in this state regarding a risk located outside this state unless registered by this state under the provisions of this chapter.

(b) A third-party administrator may not transact business for a kind or class of insurance for which the person is not registered.

(c) A person who performs administrative functions, including claims administration and payment, marketing administrative functions, premium accounting, premium billing, coverage verification, underwriting authority, or certificate issuance in regard to insurance as a third-party administrator shall be registered as a third-party administrator unless the person only investigates and adjusts claims and is licensed under this chapter as an independent adjuster.

(d) A third-party administrator may not use a fictitious name or alias unless the licensee's legal name and fictitious name or alias are on the registration.

(e) A person who is an employee of an admitted insurer, who acts within the course and scope of that employment, and within the scope of the insurer's certificate of authority is not required to be registered under this section.

(f) A person who performs management services for an admitted insurer is not required to be registered as a third-party administrator if the person's compensation is not based on the volume of premium written and the person

(1) is a wholly-owned subsidiary of the admitted insurer;

(2) wholly owns the admitted insurer;

(3) is a wholly-owned subsidiary of the insurance holding company that owns or controls the admitted insurer;

(4) is a United States manager of the United States branch of an alien admitted insurer; or

(5) is the manager of a group, association, pool, or organization of admitted insurers that does joint underwriting if it is subject to examination by the authorized insurance regulator in the state in which the person's principal place of business is located.

(g) A credit union or a financial institution subject to supervision or examination by federal or state banking authorities, or a mortgage lender, that performs no functions other than advancing premiums to the insurer and collecting a debt from the insured is not required to be registered as a third-party administrator.

(h) A credit card issuing company that performs no functions, including adjustment or settlement of claims, other than advancing and collecting premiums from its credit card holders who have authorized collection is not required to be registered as a third-party administrator.

(i) A person who only provides services to bona fide employee benefit plans that are established by an employer or an employee organization, or both, for which the insurance laws of this state are preempted under the Employee Retirement Income Security Act of 1974, is not required to be additionally registered as a third-party administrator if the person certifies to the director on or before February 1 of each year its exempt status.

(j) A third-party administrator

(1) shall apply for registration under the procedures of AS 21.27.040;

(2) shall renew its registration under the procedures of AS 21.27.380; and

(3) is subject to hearings and orders on violations; denial, nonrenewal, suspension, or revocation of registration; penalties; and surrender of registration under the procedures set out in AS 21.27.405 - 21.27.460.

AS 21.27.640. Third-Party Administrator Qualifications.

(a) The director may not issue or renew a registration except in compliance with this chapter and may not issue a registration to a person, or to be exercised by a person, found by the director to be untrustworthy, incompetent, financially irresponsible, or who has not established to the satisfaction of the director that the person is qualified under this chapter.

(b) To qualify for issuance or renewal of a registration, an applicant or registrant shall comply with this title, regulations adopted under AS 21.06.090 , and

(1) be a trustworthy person;

(2) have active working experience in administrative functions that, in the director's opinion, exhibits the ability to competently perform the administrative functions of a third-party administrator;

(3) not have committed an act that is a cause for denial, nonrenewal, suspension, or revocation of a registration or license in this state or another jurisdiction;

(4) maintain a lawfully established place of business as described in AS 21.27.330 in this state, unless licensed as a nonresident under AS 21.27.270;

(5) disclose to the director all owners, officers, directors, or partners, if any;

(6) designate a compliance officer for the firm;

(7) provide in or with its application

(A) all basic organizational documents of the third-party administrator, including articles of incorporation, articles of association, partnership agreement, trade name certificate, trust agreement, shareholder agreement, and other applicable documents and all endorsements to the required documents;

(B) the bylaws, rules, regulations, or similar documents regulating the internal affairs of the administrator;

(C) the names, mailing addresses, physical addresses, official positions, and professional qualifications of persons who are responsible for the conduct of affairs of the third-party administrator, including the members of the board of directors, board of trustees, executive committee, or other governing board or committee; the principal officers in the case of a corporation, or the partners or members in the case of a partnership, limited liability company, limited liability partnership, or association; shareholders holding directly or indirectly 10 percent or more of the voting securities of the third-party administrator; and any other person who exercises control or influence over the affairs of the third-party administrator;

(D) certified financial statements for the preceding two years, or for each year and partial year that the applicant has been in business if less than two years, prepared by an independent certified public accountant establishing that the applicant is solvent, that the applicant's system of accounting, internal control, and procedure is operating effectively to provide reasonable assurance that money is promptly accounted for and paid to the person entitled to the money, and any other information that the director may require to review the current financial condition of the applicant; and

(E) a statement describing the business plan, including information on staffing levels and activities proposed in this state and in other jurisdictions and providing details establishing the third-party administrator's capability for providing a sufficient number of experienced and qualified personnel in the areas of claims handling, underwriting, and record keeping;

(8) provide to the director documents necessary to verify the statements contained in or in connection with the application; and

(9) notify the director, in writing, within 30 days of

(A) a change in compliance officer, residence, place of business, mailing address, or phone number;

(B) the suspension or revocation of an insurance license or registration by another state or jurisdiction; or

(C) a conviction of a misdemeanor or felony of the third-party administrator, its officers, directors, partners, owners, or employees.

(c) The director may require that a third-party administrator maintain

(1) a bond as described in AS 21.27.190 in an amount acceptable to the director and conditioned in that the third-party administrator will conduct business as required by this title; and

(2) an errors and omissions insurance policy acceptable to the director.

(d) If the director finds that the applicant or registrant is qualified and that application, registration, or renewal fees have been paid, the director may issue or renew the registration.

AS 21.27.650. Operating Requirements For Third-Party Administrators.

(a) An insurer may not transact business with a third-party administrator unless

(1) the insurer holds a certificate of authority in this state;

(2) the third-party administrator is registered under this chapter or, when the third-party administrator is operating only for a foreign insurer, is registered as a third-party administrator by the third-party administrator's resident insurance regulator in a state that the director has determined has enacted provisions substantially similar to those contained in AS 21.27.630 - 21.27.650 and that is accredited by the National Association of Insurance Commissioners;

(3) the third-party administrator provides the director on January 1, April 1, July 1, and October 1 of each year

(A) a list of current employees, identifying those transacting business in this state or upon a subject resident, located or to be performed in this state;

(B) a list of current insurers under contract; and

(C) other information the director may require;

(4) a written contract is in effect between the parties that establishes the responsibilities of each party, indicates both parties' share of responsibility for a particular function, and specifies the division of responsibilities;

(5) there is in effect a written contract between the insurer and third-party administrator that contains the following provisions:

(A) the insurer may terminate the contract for cause upon written notice sent by certified mail to the third-party administrator and may suspend the underwriting authority of the third-party administrator during a dispute regarding the cause for termination; but the insurer must fulfill all lawful obligations with respect to policies affected by the written agreement, regardless of any dispute between the insurer and the third-party administrator;

(B) the third-party administrator shall render accounts to the insurer detailing all transactions and remit all money due under the contract to the insurer at least monthly;

(C) all money collected for the account of an insurer shall be held by the third-party administrator as a fiduciary;

(D) all payments on behalf of the insurer shall be held by the third-party administrator as a fiduciary;

(E) the third-party administrator may not retain more than three months estimated claims payments and allocated loss adjustment expenses;

(F) the third-party administrator shall maintain separate records for each insurer in a form usable by the insurer; the insurer or its authorized representative shall have the right to audit and the right to copy all accounts and records related to the insurer's business; the director, in addition to other authority granted in this title, shall have access to all books, bank accounts, and records of the third-party administrator in a form usable to the director; any trade secrets contained in books and records reviewed by the director, including the identity and addresses of policyholders and certificate holders, shall be kept confidential, except that the director may use the information in a proceeding instituted against the third-party administrator or the insurer;

(G) the contract may not be assigned in whole or in part by the third-party administrator;

(H) if the contract permits the third-party administrator to do underwriting, the contract must include the following:

(i) the third-party administrator's maximum annual premium volume;

(ii) the rating system and basis of the rates to be charged;

(iii) the types of risks that may be written;

(iv) maximum limits of liability;

(v) applicable exclusions;

(vi) territorial limitations;

(vii) policy cancellation provisions;

(viii) the maximum policy term; and

(ix) that the insurer shall have the right to cancel or not renew a policy of insurance subject to applicable state law;

(I) if the contract permits the third-party administrator to administer claims on behalf of the insurer, the contract must include the following:

(i) written settlement authority must be provided by the insurer and may be terminated for cause upon the insurer's written notice sent by certified mail to the third-party administrator or upon the termination of the contract, but the insurer may suspend the settlement authority during a dispute regarding the cause of termination;

(ii) claims shall be reported to the insurer within 30 days;

(iii) a copy of the claim file shall be sent to the insurer upon request or as soon as it becomes known that the claim has the potential to exceed an amount determined by the director or exceeds the limit set by the insurer, whichever is less, involves a coverage dispute, may exceed the third-party administrator's claims settlement authority, is open for more than six months, involves extra contractual allegations, or is closed by payment in excess of an amount set by the director or an amount set by the insurer, whichever is less;

(iv) each party to the contract shall comply with unfair claims settlement statutes and regulations;

(v) transmission of electronic data must occur at least monthly if electronic claim files are in existence; and

(vi) claim files shall be the sole property of the insurer; upon an order of liquidation of the insurer, the third-party administrator shall have reasonable access to and the right to copy the files on a timely basis; and

(J) the contract may not provide for commissions, fees, or charges contingent upon savings obtained in the adjustment, settlement, and payment of losses covered by the insurer's obligations; but a third-party administrator may receive performance-based compensation for providing hospital or other auditing services or may receive compensation based on premiums or charges collected or the number of claims paid or processed.

(b) If the insurer is domiciled in this state or the third-party administrator has a place of business in this state, a copy of the contract must be filed with and approved by the director at least 30 days before the third-party administrator transacts business on behalf of the insurer. If the contract is not required to be approved in advance by the director, the insurer shall provide written notification to the director within 30 days of the entry into or termination of a contract with a third-party administrator; the notice must include a statement of duties to be performed by the third-party administrator on behalf of the insurer, the kinds and classes of insurance for which the third-party administrator has authorization to act, and other information required by the director.

(c) If the contract provides for the third-party administrator to receive or collect premiums, payment by or on behalf of the insured of premiums for insurance to the third-party administrator shall be presumed to have been received by the insurer; payment of return premiums or claim payments forwarded by the insurer to the third-party administrator may not be presumed to have been received by the person entitled to the money until the payments are received by the insured or claimant. Nothing in this subsection limits the rights that the insurer may have against the third-party administrator resulting from the failure of the third-party administrator to make payments to persons entitled to money.

(d) Policies, certificates, booklets, termination notices or other written communications delivered by the insurer to the third-party administrator for delivery to the insured or covered individuals shall be delivered by the third-party administrator within 10 days after receipt of instructions from the insurer to deliver them.

(e) When the services of a third-party administrator are utilized, the third-party administrator shall provide a written notice, approved in writing by the insurer, to a covered person advising the person of the identity of the insurer and the relationship between the third-party administrator, the policyholder, and the insurer.

(f) The third-party administrator may not

(1) bind reinsurance or retrocessions on behalf of the insurer;

(2) commit the insurer to participate in insurance or reinsurance syndicates;

(3) pay or commit the insurer to pay a claim, net of reinsurance, the amount of which exceeds one percent of the insurer's policyholder's surplus as of December 31 of the last completed calendar year without prior written approval of the insurer for the settlement; the approval of an insurer must be received after the insurer has been notified in writing that the claim settlement will exceed one percent of the insurer's policyholder's surplus as of December 31 of the last completed calendar year;

(4) collect a payment from a reinsurer or commit the insurer to a claim settlement with a reinsurer without prior written approval of the insurer, but if prior written approval is given, a complete report must be forwarded to the insurer within 30 days;

(5) serve on the insurer's board of directors;

(6) jointly employ an individual who is employed by the insurer;

(7) delegate third-party administrator authority to another person;

(8) solicit applications for insurance or renewals of insurance directly through employees or by appointments of insurance producers as its subagents unless its employees or the insurance producers appointed under the procedures set out in AS 21.27.100 and 21.27.110 are licensed for the kinds or classes of insurance and the solicitation or renewals are within the scope of authority granted by the insurer contracting with the third-party administrator; or

(9) advertise the business underwritten by an insurer unless the advertising has been approved in writing by the insurer in advance of its use.

(g) In a form acceptable to the director, a third-party administrator shall annually provide to the insurer and an insurer shall annually obtain a copy of certified financial statements prepared by an independent certified public accountant of each third-party administrator with which the insurer has done business.

(h) In addition to any other required loss reserve certification, if a third-party administrator establishes loss reserves, the insurer shall annually obtain the opinion of an independent qualified actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the third-party administrator. The insurer retains an independent responsibility to determine the adequacy of its loss reserves, including those established by its third-party administrators.

(i) If a third-party administrator provides services for more than 100 certificate holders on behalf of an insurer, the insurer shall at least semiannually conduct a review of the operations of the third-party administrator. At least one review required under this subsection must be an on-site review.

(j) A third-party administrator shall maintain records as described in AS 21.27.350 .

(k) An insurer may not appoint to its board of directors an officer, director, employee, subagent, insurance producer, or controlling shareholder of its third-party administrator.

(l) An actual or apparently authorized act of the third-party administrator is considered to be the act of the insurer upon whose behalf the third-party administrator is acting.

(m) A third-party administrator may be examined by the director under AS 21.06.120 as if it were the insurer.

(n) If the director determines after a hearing under AS 21.06.170 - 21.06.240 that a third-party administrator caused loss arising out of a violation of AS 21.27.630 - 21.27.650 to an insurer, the director may order the third-party administrator to reimburse the insurer, the rehabilitator, or the liquidator of the insurer for the loss. Reimbursement ordered under this subsection is in addition to any other liability of the third-party administrator and does not affect the rights of a policyholder, claimant, creditor, or third-party.

(o) In addition to any other penalty provided by law, a person who violates this section is subject to the penalties provided under AS 21.27.440 and an insurer's certificate of authority may be suspended or revoked.

(p) In this section, "transact" has the meaning given in AS 21.90.900 .

AS 21.27.670. Reinsurance Intermediary Broker Qualifications.

(a) In addition to the general qualifications under AS 21.27.020 , to qualify for issuance or renewal of a reinsurance intermediary broker license, an applicant or licensee shall have at least three years active working experience within the previous 10 calendar years in insurance administrative functions, that, in the director's opinion, exhibit the applicant's ability to competently perform the functions for all kinds and classes of insurance applied for.

(b) The director may require that a reinsurance intermediary broker maintain

(1) a bond in an amount acceptable to the director in favor of insurers and this state, and with a condition in that the reinsurance intermediary broker conduct business as required under this title; and

(2) an errors and omissions insurance policy acceptable to the director.

AS 21.27.680. Trainee Reinsurance Intermediary Brokers.

(a) An individual licensed in this state as an insurance producer, who does not have the experience required of a reinsurance intermediary broker but who otherwise meets the requirements of AS 21.27.670 , may be employed by a licensed reinsurance intermediary broker as a trainee reinsurance intermediary broker, subject to the provisions of this section.

(b) Before an individual may transact insurance as a trainee reinsurance intermediary broker, the reinsurance intermediary broker employing the trainee reinsurance intermediary broker shall submit to the director the application of the trainee reinsurance intermediary broker, with the fee set under AS 21.06.250 , and receive the trainee reinsurance intermediary broker license.

(c) Upon satisfying the experience requirement, a trainee reinsurance intermediary broker shall apply within 30 days for a reinsurance intermediary broker license.

(d) A trainee reinsurance intermediary broker shall at all times be working at the direction and under the supervision of the employing licensed reinsurance intermediary broker, and the file and record documentation must reflect the direction and supervision. Insurance activities must be in the name of the employing reinsurance intermediary broker who is responsible for all actions of the trainee reinsurance intermediary broker.

(e) A trainee reinsurance intermediary broker is restricted to assisting the employing licensed reinsurance intermediary broker in preparing applications; binders; certificates of insurance; schedules of equipment, vehicles, and drivers; loss notices to insurers; and invoices; and to performing clerical functions for which a license is not required. The file and record documentation must reflect compliance with this subsection.

(f) A trainee reinsurance intermediary broker may not transact business away from the place of business with clients, insurers, or reinsurers unless a licensed reinsurance intermediary broker physically accompanies the trainee.

(g) In addition to any other penalty provided by law,

(1) the director shall revoke the license of a trainee reinsurance intermediary broker who the director determines has violated the provisions of this section; a licensee or other person having possession or custody of the license shall immediately surrender the license to the director either personally or by certified mail;

(2) if the director determines under AS 21.06.170 - 21.06.240 that the employing reinsurance intermediary broker knew of or should have known that a trainee reinsurance intermediary broker violated this section, the employing reinsurance intermediary broker and firm and compliance officer, if any, are subject to the penalties provided under AS 21.27.440 .

AS 21.27.690. Operating Requirements For Reinsurance Intermediary Brokers; Actions For Loss.

(a) Except as provided in (b) of this section, an insurer may not transact business with a reinsurance intermediary broker unless the insurer holds a certificate of authority in this state, the reinsurance intermediary broker is licensed in this state, and there is in effect a written contract between the parties that establishes the responsibilities of each party, indicates each party's share of responsibility for each particular function, and specifies the division of responsibilities. The written contract shall be kept in the permanent records of the insurer and the reinsurance intermediary broker, be open to inspection by the director, and must contain the following minimum provisions:

(1) the insurer may terminate the reinsurance intermediary broker's authority at any time by written notice sent by certified mail;

(2) the reinsurance intermediary broker shall render accounts to the insurer detailing all transactions including information necessary to support all commissions, charges, and other fees received by or owing to the reinsurance intermediary broker and remit the money due under the contract to the insurer within 30 days of receipt;

(3) money collected for the account of an insurer shall be held by the reinsurance intermediary broker as a fiduciary;

(4) the reinsurance intermediary broker shall maintain separate accounts and records for each insurer and maintain the records in a form usable by the insurer; the insurer or the authorized representative of the insurer shall have access and the right to audit and the right to copy all accounts and records related to the insurer's business; the director, in addition to the other authority granted in this title, shall have access to all books, bank accounts, and records of the insurance intermediary broker in a form usable to the director;

(5) the insurer shall establish written standards for the cession or retrocession of all risks, and the reinsurance intermediary broker shall comply with those standards;

(6) the reinsurance intermediary broker shall disclose to the insurer all its relationships with insurers and reinsurers to whom risks are ceded or retroceded; and

(7) the contract may not be assigned in whole or in part by the reinsurance intermediary broker.

(b) An insurer may use a nonresident reinsurance intermediary broker who is not licensed under this chapter if the person is licensed in good standing as a resident reinsurance intermediary broker by an insurance regulator of another state that is accredited by the National Association of Insurance Commissioners. Upon written request, the director may grant written permission for a domestic insurer to use an alien reinsurance intermediary broker not licensed by and without a place of business in a jurisdiction subject to accreditation by the National Association of Insurance Commissioners if the alien reinsurance intermediary broker is licensed in good standing by its domiciliary insurance regulator. The domestic insurer and unlicensed reinsurance intermediary broker are subject to all other requirements of this section.

(c) An insurer may not employ a person who is employed by a reinsurance intermediary broker with which it transacts business, unless the reinsurance intermediary broker is under common control with the insurer and subject to AS 21.22.

(d) In a form acceptable to the director, a reinsurance intermediary broker shall annually provide and an insurer shall annually obtain a copy of certified financial statements of each reinsurance intermediary broker with which the insurer has done business, prepared by the independent certified public accountant.

(e) If the director determines after a hearing under AS 21.06.170 - 21.06.240 that a reinsurance intermediary broker caused losses or damage arising out of a violation of AS 21.27.670 - 21.27.700 to an insurer or reinsurer, the director may order the reinsurance intermediary broker to make restitution to the insurer, reinsurer, receiver, rehabilitator, or liquidator of the insurer or reinsurer for the net losses incurred by the insurer or reinsurer. Restitution ordered under this subsection is in addition to any other liability of the reinsurance intermediary broker and does not affect the rights of a policyholder, claimant, creditor, or third party. The director may, at the request of the insurer, maintain or bring a civil action brought by or on behalf of the reinsurer or insurer and its policyholders and creditors for recovery of compensatory damages for the benefit of the reinsurer or insurer and its policyholders and creditors or seek other appropriate relief. If an order of rehabilitation or liquidation of the insurer has been entered under AS 21.78, the receiver appointed under the order determines that a person has not materially complied with AS 21.27.670 - 21.27.700 or an order of the director, and the insurer suffers loss or damage from the noncompliance, the receiver may bring a civil action for the recovery of damages or other appropriate sanctions for the benefit of the insurer.

(f) In addition to any other penalty provided by law, a person who violates this section is subject to the penalties provided under AS 21.27.440 and an insurer's certificate of authority may be suspended or revoked.

(g) In this section, "transact" has the meaning given in AS 21.90.900 .

AS 21.27.700. Reinsurance Intermediary Broker Records.

In addition to any other records requirements under this title, a reinsurance intermediary broker shall maintain in organized form a record of each transaction including

(1) the type of contract, limits, underwriting restrictions, classes or risks, and territory;

(2) the period of coverage, including effective and expiration dates, cancellation provisions, and required notice of cancellation;

(3) the reporting and settlement requirements of balances;

(4) the rate used to compute the reinsurance premium;

(5) the names and addresses of reinsurers;

(6) the rate of all reinsurance commissions, including the commissions on retrocessions handled by the reinsurance intermediary broker;

(7) the related correspondence and memoranda;

(8) the proof of placement;

(9) the details regarding retrocessions handled by the reinsurance intermediary broker including the identity of retrocessionaires and the percentage of each contract assumed or ceded;

(10) the financial records of premium and loss accounts;

(11) if the reinsurance intermediary broker procures a reinsurance contract on behalf of an admitted ceding insurer

(A) written evidence directly from an assuming reinsurer that it has agreed to assume the risk; or

(B) written evidence, if placed through a representative of the assuming reinsurer other than an employee, that the reinsurer had delegated binding authority to the representative; and

(12) additional information that is customary or that may be required by the director.

AS 21.27.730. Reinsurance Intermediary Manager Qualifications.

(a) In addition to the general qualifications under AS 21.27.020 , to qualify for issuance or renewal of a reinsurance intermediary manager license, an applicant or licensee shall have at least three years active working experience within the previous 10 calendar years in insurance administrative functions, that, in the director's opinion, exhibit the applicant's abilities to competently perform the functions for all kinds and classes of insurance applied for.

(b) The director may require that a reinsurance intermediary manager maintain

(1) a bond in an amount acceptable to the director and with a condition that the reinsurance intermediary manager conduct business as required under this title; and

(2) an errors and omissions insurance policy acceptable to the director.

AS 21.27.740. Trainee Reinsurance Intermediary Managers.

(a) An individual licensed in this state as an insurance producer who does not have the experience required of a reinsurance intermediary manager, but who otherwise meets the requirements of AS 21.27.730 , may be employed by a licensed reinsurance intermediary manager as a trainee reinsurance intermediary manager, subject to the provisions of this section.

(b) Before an individual may transact insurance as a trainee reinsurance intermediary manager, the reinsurance intermediary manager employing the trainee reinsurance intermediary manager shall submit to the director the application of the trainee reinsurance intermediary manager, with the fee set under AS 21.06.250 , and receive the trainee reinsurance intermediary manager license.

(c) Upon satisfying the experience requirement, a trainee reinsurance intermediary manager shall apply within 30 days for a reinsurance intermediary manager license.

(d) A trainee reinsurance intermediary manager shall at all times be working at the direction and under the supervision of the employing licensed reinsurance intermediary manager, and the file and record documentation must reflect the direction and supervision. Insurance activities must be in the name of the employing reinsurance intermediary manager, who is responsible for all insurance actions of the trainee reinsurance intermediary manager.

(e) A trainee reinsurance intermediary manager is restricted to assisting the employing licensed reinsurance intermediary manager in preparing applications; binders; certificates of insurance; schedules of equipment, vehicles, and drivers; loss notices to insurers; and invoices; and to performing clerical functions for which a license is not required. The file and record documentation must reflect compliance with this subsection.

(f) A trainee reinsurance intermediary manager may not transact business away from the place of business with clients, insurers, or reinsurers unless a reinsurance intermediary manager physically accompanies the trainee.

(g) In addition to any other penalty provided by law,

(1) a trainee reinsurance intermediary manager who the director determines has violated the provisions of this section shall have its license revoked; a licensee or other person having possession or custody of the license shall immediately surrender the license to the director either personally or by certified mail;

(2) if the director determines under AS 21.06.170 - 21.06.240 that the employing reinsurance intermediary manager knew of or should have known that a trainee reinsurance intermediary manager violated this section, the employing reinsurance intermediary manager and firm, principal, and manager, if any, are subject to the penalties provided under AS 21.27.440 .

AS 21.27.750. Authority of Reinsurance Intermediary Managers.

A reinsurance intermediary manager has only the authority that is consistent with this title and that is conferred by the reinsurer. A reinsurance intermediary manager, resident or nonresident, qualified and licensed under this chapter, may exercise the powers conferred by this title upon insurance producers and independent adjusters only for the kinds or classes of insurance and within the scope that reinsurance intermediary is authorized by the reinsurer appointing the reinsurance intermediary manager.

AS 21.27.760. Operating Requirements For Reinsurance Intermediary Managers; Actions For Loss.

(a) A reinsurer may not transact business with a reinsurance intermediary manager unless there is in effect a written contract approved by the reinsurer's board of directors between the parties that establishes the responsibilities of each party, indicates each party's share of responsibility for each particular function, and specifies the division of responsibilities.

(b) The contract required under (a) of this section must include the following provisions:

(1) the reinsurer may terminate the contract for cause upon written notice sent by certified mail to the reinsurance intermediary manager and may suspend the underwriting authority of the reinsurance intermediary manager during a dispute regarding the cause for termination;

(2) the reinsurance intermediary manager shall render accounts to the reinsurer detailing all transactions including information necessary to support all commissions, charges, and other fees received by or owing to the reinsurance intermediary manager and remit all money due under the contract to the insurer at least monthly;

(3) money collected for the account of a reinsurer shall be held by the reinsurance intermediary manager as a fiduciary;

(4) the reinsurance intermediary manager shall maintain a separate bank account for each reinsurer that it represents;

(5) all payments on behalf of the reinsurer shall be held by the reinsurance intermediary manager as a fiduciary;

(6) the reinsurance intermediary manager may retain not more than three months estimated claims payments and allocated loss adjustment expenses;

(7) the reinsurance intermediary manager shall maintain separate accounts and records for each reinsurer and maintain the records in a form usable by the reinsurer; the reinsurer or its authorized representative shall have access and the right to audit and the right to copy all accounts and records related to the reinsurer's business; the director, in addition to the other authority granted in this title, shall have access to all books, bank accounts, and records of the reinsurance intermediary manager in a form usable to the director;

(8) the contract may not be assigned in whole or in part by the reinsurance intermediary manager;

(9) the reinsurer shall establish written underwriting and rating standards for the acceptance, rejection, or cession of all risks and the reinsurance intermediary manager shall comply with the standards;

(10) compensation including rates, terms, purposes of commissions, charges, and other fees that the reinsurance intermediary manager may levy against the reinsurer;

(11) if the contract permits the reinsurance intermediary manager to settle claims on behalf of the reinsurer,

(A) written settlement authority must be provided by the reinsurer and may be terminated for cause upon the insurer's written notice by certified mail to the reinsurance intermediary manager or upon the termination of the contract; the reinsurer may suspend the settlement authority during a dispute regarding the cause of termination;

(B) claims shall be reported to the reinsurer within 30 days;

(C) a copy of the claim file shall be sent to the reinsurer upon request or as soon as it becomes known that the claim

(i) has the potential to exceed an amount determined by the director or exceeds the limit set by the insurer, whichever is less;

(ii) involves a coverage dispute;

(iii) may exceed the reinsurance intermediary manager's claims settlement authority;

(iv) is open for more than six months;

(v) involves extra contractual allegations; or

(vi) is closed by payment in excess of an amount set by the director or an amount set by the insurer, whichever is less;

(D) the reinsurance intermediary manager shall comply with unfair claims settlement statutes and regulations;

(E) transmission of electronic data at least once a month if electronic claims files are in existence;

(F) claim files shall be the property of both the reinsurer and reinsurance intermediary manager, but upon an order of liquidation of the reinsurer, the files shall become the sole property of the reinsurer or the reinsurer's estate; the reinsurance intermediary manager shall have reasonable access to and the right to copy the files on a timely basis;

(12) if the contract provides for sharing of interim profits by the reinsurance intermediary manager, the interim profits may not be paid until

(A) one calendar year after the end of each underwriting period for property risks and five years after the end of each underwriting period for casualty risks;

(B) a later period established by the director for specified kinds or classes of insurance; and

(C) the profits have been verified under (e)(2) of this section;

(13) the reinsurance intermediary manager may not

(A) cede retrocessions on behalf of the reinsurer, except that the reinsurance intermediary manager may cede facultative retrocessions under obligatory agreements if the contract with the reinsurer contains reinsurance underwriting guidelines including a list of reinsurers with which automatic agreements are in effect, and, for each reinsurer, the coverage and amounts or percentages that may be reinsured, and commission schedules;

(B) commit the reinsurer to participate in reinsurance syndicates;

(C) appoint a subagent unless the scope of the subagent's license as an insurance producer includes the kinds and classes of insurance for which the subagent is appointed;

(D) pay or commit the reinsurer to pay a claim, net of retrocessions, the amount of which exceeds one percent of the reinsurer's policyholder's surplus as of December 31 of the last completed calendar year without the prior written approval of the reinsurer for the settlement and the approval is received after the reinsurer has been notified in writing that the claim settlement will exceed one percent of the reinsurer's policyholder's surplus as of December 31 of the last completed calendar year;

(E) collect payment from a retrocessionaire or commit the reinsurer to a claim settlement with a retrocessionaire without prior written approval of the reinsurer, but if prior written approval is given, a complete report shall be forwarded to the reinsurer within 30 days;

(F) jointly employ an individual who is employed with the reinsurer; or

(G) delegate reinsurance intermediary manager authority to another person;

(14) if the insurer is domiciled in this state or the reinsurance intermediary manager has a place of business in this state, a copy of the contract must be filed with and approved by the director at least 30 days before the reinsurance intermediary manager transacts business on behalf of the reinsurer; if the reinsurer is not domiciled in this state or the reinsurance intermediary manager transacts business relative to a subject resident, located, or to be performed in this state from a place of business not physically located in this state, a copy of the contract required in this section must be filed with and approved by the director at least 30 days before the reinsurance intermediary manager transacts business on behalf of the insurer in this state or relative to a subject resident, located, or to be performed in this state if the insurer or the reinsurance intermediary manager are domiciled in a state not accredited by the National Association of Insurance Commissioners; and

(15) if the contract is not required to be approved in advance by the director, the insurer shall provide written notification to the director within 30 days of the entry into or termination of a contract with a reinsurance intermediary manager; the notice must include a statement of duties to be performed by the reinsurance intermediary manager on behalf of the reinsurer, the kinds and classes of insurance for which the reinsurance intermediary manager has authorization to act, and other information required by the director.

(c) Binding authority for all retrocession contracts or participation in reinsurance syndicates may only rest with an officer of the reinsurer who is not affiliated with a reinsurance intermediary manager.

(d) In a form acceptable to the director, a reinsurance intermediary manager shall annually provide and a reinsurer shall annually obtain a copy of certified financial statements of each reinsurance intermediary manager that the reinsurer has used, prepared by an independent certified public accountant.

(e) The reinsurer shall

(1) at least semiannually conduct an on-site review of the underwriting and claims processing operations of each reinsurance intermediary manager;

(2) in addition to any other required loss reserve certification, annually obtain the opinion of an independent qualified actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the reinsurance intermediary manager if a reinsurance intermediary manager establishes loss reserves; the reinsurer retains an independent responsibility to determine the adequacy of its loss reserves, including those established by its reinsurance intermediary manager; and

(3) provide written notification to the director by certified mail within 30 days of the termination of a contract with a reinsurance intermediary manager.

(f) The reinsurance intermediary manager shall disclose to the reinsurer a relationship with an insurer before ceding or assuming risks with the insurer under the contract.

(g) A reinsurer may not appoint to its board of directors an officer, director, employee, subagent, insurance producer, or controlling shareholder of its reinsurance intermediary manager.

(h) Within the scope of the actual or apparent authority, the acts of the reinsurance intermediary manager are considered the acts of the reinsurer upon whose behalf it is acting.

(i) A reinsurance intermediary manager may be examined by the director as if it were the insurer.

(j) If the director determines after a hearing under AS 21.06.170 - 21.06.240 that a reinsurance intermediary manager caused losses or damage arising out of a violation of AS 21.27.730 - 21.27.770 to an insurer or reinsurer, the director may order the reinsurance intermediary manager to make restitution to the insurer, reinsurer, receiver, rehabilitator, or liquidator of the insurer or reinsurer for the net losses incurred by the insurer or reinsurer. Restitution ordered under this subsection is in addition to any other liability of the reinsurance intermediary manager and does not affect the rights of a policyholder, claimant, creditor, or third party. The director may, at the request of the insurer, maintain or bring a civil action brought by or on behalf of the reinsurer or insurer and its policyholders and creditors for recovery of compensatory damages for the benefit of the reinsurer or insurer and its policyholders and creditors or seek other appropriate relief. If an order of rehabilitation or liquidation of the insurer has been entered under AS 21.78, the receiver appointed under the order determines that a person has not materially complied with AS 21.27.730 - 21.27.770 or an order of the director, and the insurer suffers loss or damage from the noncompliance, the receiver may bring a civil action for the recovery of damages or other appropriate sanctions for the benefit of the insurer.

(k) In addition to any other penalty provided by law, a person who violates this section is subject to the penalties provided under AS 21.27.440 and an insurer's or reinsurer's certificate of authority may be suspended or revoked.

(l) In this section, "transact" has the meaning given in AS 21.90.900 .

AS 21.27.770. Reinsurance Intermediary Manager Records.

In addition to any other records requirements under this chapter, a reinsurance intermediary manager shall maintain in organized form a complete record of each transaction including

(1) the type of contract, limits, underwriting restrictions, classes or risks, and territory;

(2) the period of coverage, including effective and expiration dates, cancellation provisions, and required notice of cancellation;

(3) disposition of outstanding reserves on covered risks;

(4) the reporting and settlement requirements of balances;

(5) the rate used to compute the reinsurance premium;

(6) the names and addresses of reinsurers;

(7) the rate of all reinsurance commissions, including the commissions on retrocessions handled by the reinsurance intermediary broker and reinsurance intermediary manager;

(8) related correspondence and memoranda;

(9) proof of placement;

(10) details regarding retrocessions handled by the reinsurance intermediary broker and reinsurance intermediary manager including the identity of retrocessionaires and the percentage of each contract assumed or ceded;

(11) financial records of premium and loss accounts; and

(12) if the reinsurance intermediary broker procures a reinsurance contract on behalf of an admitted ceding insurer or when the reinsurance intermediary manager places a reinsurance contract on behalf of a ceding insurer, written evidence

(A) directly from an assuming reinsurer that it has agreed to assume the risk; or

(B) that the reinsurer had delegated binding authority to the representative, if placed through a representative of the assuming reinsurer other than an employee of the assuming reinsurer.

AS 21.27.790. Surplus Lines Broker Qualifications.

In addition to the general qualifications under AS 21.27.020 , to qualify for issuance or for renewal of a surplus lines broker license, an applicant or licensee shall

(1) have a minimum two years active working experience within the previous five calendar years as an insurance producer, managing general agent, reinsurance intermediary broker, reinsurance intermediary manager, independent adjuster, or underwriter or claims adjuster employee of an insurer and, in the director's opinion, exhibit the ability to competently perform the responsibilities of the license applied for;

(2) if required by the director by regulation, maintain a bond as described in AS 21.27.190 in an amount acceptable to the director with the conditions that the surplus lines broker conduct business under the provisions of this title, promptly remit the taxes and fees provided by law, return premiums promptly when due, and pay proper losses promptly;

(3) if the director requires, maintain an errors and omissions insurance policy acceptable to the director.

AS 21.27.800. Trainee Surplus Lines Broker.

(a) An individual licensed in this state as an insurance producer who does not have the experience required of a surplus lines broker, but who otherwise meets the requirements of AS 21.27.790 , may be employed by a licensed surplus lines broker as a trainee surplus lines broker, subject to the provisions of this section.

(b) Before an individual may transact insurance as a trainee surplus lines broker, the licensed surplus lines broker employing the trainee surplus lines broker shall submit to the director the application of the trainee surplus lines broker, with the fee set under AS 21.06.250 , and receive the trainee surplus lines broker license.

(c) Upon satisfying the experience requirement, a trainee surplus lines broker shall apply within 30 days for a surplus lines broker license.

(d) A trainee licensed under this section shall at all times be working at the direction and under the supervision of the employing licensed surplus lines broker, and the file and record documentation shall reflect the direction and supervision. Insurance activities must be in the name of the employing licensed surplus lines broker, who is responsible for all actions of the trainee surplus lines broker.

(e) A trainee licensed under this section is restricted to assisting the employing licensed surplus lines broker in preparing applications; binders; certificates of insurance; schedules of equipment, vehicles, and drivers; loss notices to insurers; and invoices; and to perform clerical functions for which a license is not required. The file and record documentation must reflect compliance with this subsection.

(f) A trainee surplus line broker licensed under this section may not transact business away from the place of business with clients or insurers unless a licensed surplus lines broker physically accompanies the trainee.

(g) In addition to any other penalty provided by law,

(1) the director shall revoke the license of a trainee surplus lines broker who the director determines has violated the provisions of this section; a licensee or other person having possession or custody of the license shall immediately surrender the license to the director either personally or by certified mail;

(2) if the director determines under AS 21.06.170 - 21.06.240 that the employing surplus lines broker knew of or should have known that a trainee licensed under this section violated this section, the employing surplus lines broker and firm, and the compliance officer, if any, are subject to the penalties provided under AS 21.27.440 .

AS 21.27.810. Surplus Lines Broker Records.

In addition to any other records requirements under this chapter, a surplus lines broker shall maintain in organized form a complete record including

(1) the amount of insurance and perils insured;

(2) a complete description of property insured and the location of the property;

(3) gross premium charged;

(4) a return premium paid;

(5) the rate of premium charged upon the several items of property;

(6) the effective date of the contract and the terms of the contract;

(7) the name and address of the insured;

(8) the name and address of the insurer;

(9) the amount of tax and other sums to be collected from the insured;

(10) the allocation of taxes by state under AS 21.34.180 ;

(11) evidence of insurance issued in compliance with AS 21.34.100 ;

(12) the identity and license number of the producing broker;

(13) any confirming correspondence from the insurer or the representative of the insurer; and

(14) the application.

AS 21.27.820. Denial, Nonrenewal, Suspension, or Revocation of Surplus Lines Broker License.

In addition to other action available under this title, the director may deny issuance of or not renew a license, or may suspend or revoke a license of a surplus lines broker issued under this chapter for any of the following causes:

(1) removal of the resident surplus lines broker's office from this state;

(2) removal of the resident surplus lines broker's accounts and records from this state during the period within which the accounts and records are required to be maintained under this chapter;

(3) removal of the nonresident surplus lines broker's accounts and records required to be maintained under this chapter from the location described in the license without prior approval of the director;

(4) closing of the surplus lines broker's office for a period of more than 45 calendar days, unless permission is granted by the director;

(5) failure to make a required report;

(6) failure to transmit a required tax or fee on a surplus line premium to this state or a reciprocal state to which a tax is owing;

(7) failure to maintain a required bond.

AS 21.27.830. Independent Adjuster Qualifications.

In addition to the general qualifications under AS 21.27.020 , to qualify for issuance or renewal of an independent adjuster license, an applicant or licensee shall

(1) have at least six months active working experience within the previous two calendar years as either an independent adjuster trainee, an insurance producer, a managing general agent, a reinsurance intermediary broker, a reinsurance intermediary manager, a surplus lines broker, an independent adjuster, or an underwriter or claims adjuster employee of an insurer, and, in the director's opinion, exhibit the ability to competently perform the responsibilities of an independent adjuster; or

(2) have been previously licensed in good standing in this state as an independent adjuster within the previous four calendar years and not have had a license suspended or revoked.

AS 21.27.840. Trainee Independent Adjusters.

(a) An individual resident who does not have the experience with reference to the handling of loss claims but who otherwise meets the requirements of AS 21.27.830 , may be employed by a licensed independent adjuster as a trainee independent adjuster, subject to the provisions of this section.

(b) Before the individual may handle loss claims, the licensed independent adjuster employing the trainee independent adjuster shall submit to the director the application of the trainee independent adjuster, with the fee set under AS 21.06.250 , and receive the trainee independent adjuster license.

(c) The director shall revoke a trainee independent adjuster license unless the individual has

(1) not later than four months after the effective date of the trainee adjuster license, complied with the independent adjuster licensing requirements of AS 21.27.060 concerning the insurance laws and regulations of this state;

(2) not later than eight months after the effective date of the trainee adjuster license, complied with the independent adjuster licensing requirements of AS 21.27.060 concerning the knowledge and competence of the licensee concerning handling of loss claims and the licensee's duties and responsibilities as a licensee; and

(3) within 12 months after the effective date of the trainee adjuster license, complied with all other independent adjuster licensing requirements.

(d) A person whose trainee independent adjuster license was revoked for failure to meet a requirement of (c) of this section may submit a new application for a trainee independent adjuster license after the person has successfully passed both tests required under (c) of this section.

(e) Upon satisfying the requirements of (c) of this section, a trainee independent adjuster shall apply within 30 days for an independent adjuster license.

(f) A trainee independent adjuster shall at all times be working at the direction and under the supervision of the employing licensed independent adjuster, and the file and record documentation shall reflect the direction and supervision. The employing licensed independent adjuster and its firm, and the compliance officer, if any, are responsible for all insurance actions of the trainee independent adjuster.

(g) A trainee independent adjuster is restricted to participation in a factual investigation and a tentative closing of a loss subject to review and final determination by the employing licensed independent adjuster, and file and record documentation shall reflect compliance with this subsection.

(h) A trainee independent adjuster may not participate in a factual investigation and a tentative closing of a loss away from the place of business unless a licensed independent adjuster physically accompanies the trainee.

(i) In addition to any other penalty provided by law,

(1) a trainee independent adjuster who the director determines has violated the provisions of this section shall have its license terminated; a licensee or other person having possession or custody of the license shall within 30 days surrender the license to the director either personally or by certified mail;

(2) if the director determines under AS 21.06.170 - 21.06.240 that the employing licensed independent adjuster knew of or should have known that a trainee independent adjuster violated this section, the employing licensed independent adjuster and firm, and the compliance officer, if any, are subject to the penalties provided under AS 21.27.440.

AS 21.27.850. Insurance Producer, Managing General Agent, Surplus Line Broker, Reinsurance Intermediary Broker, and Reinsurance Intermediary Manager as Independent Adjuster.

Without being required by this chapter to be licensed also as an independent adjuster

(1) a licensed insurance producer and a licensed managing general agent, incidental to acting as an insurance producer, may act as an adjuster and investigate, adjust, and report upon claims on behalf of and as authorized by an admitted insurer that has appointed the insurance producer or the managing general agent as its agent under AS 21.27.100;

(2) a surplus lines broker may act as an adjuster and investigate, adjust, and report upon claims on behalf of and as authorized by a nonadmitted insurer; and

(3) a reinsurance intermediary broker or a reinsurance intermediary manager may act as an adjuster and investigate, adjust, and report upon claims on behalf of and as authorized by an insurer or reinsurer under the contract required by this chapter.

AS 21.27.860. Unlicensed Nonresident Adjusters.

(a) A nonresident independent adjuster not licensed by this state who is licensed by and in good standing with its resident state may act as an adjuster and adjust a single loss in this state during a calendar year, or may act as an adjuster and adjust losses arising out of a catastrophe as declared by the director, if, within 10 days after the start of an investigation or adjustment under this section, the nonresident independent adjuster has advised the director in writing of the adjustment and provided the following information:

(1) the individual and firm name;

(2) the business mailing address;

(3) the business physical address and phone number;

(4) the licensing state of residence;

(5) the resident license number; and

(6) other facts that the director may require.

(b) A nonresident independent adjuster may be sued upon a cause of action arising in this state arising from an adjustment under this section under the procedure provided in AS 21.33.

AS 21.27.870. Independent Adjuster Records.

In addition to any other records requirements under this chapter, an independent adjuster shall maintain in organized form a complete record of each investigation or adjustment undertaken or consummated, and a statement of the fee, commission, or other compensation received or to be received by the adjuster on account of the investigation or adjustment.

AS 21.27.900. Definitions.

In this chapter,

(1) "affiliate" or "affiliated" has the meaning given in AS 21.22.200;

(2) "cession" means a unit of insurance, passed to a reinsurer by a primary insurer that issued the policy to the original insured, that may transfer part or all of a single risk, defined in the policy, or a defined group of business as agreed to in a contract of reinsurance;

(3) "class of authority" means the authority held by a person under a license as an insurance producer, managing general agent, reinsurance intermediary broker, reinsurance intermediary manager, surplus lines broker, or independent adjuster, or under registration as a third-party administrator.

(4) "comparable business" means the same lines or kinds of insurance, the same classes of risks, similar policy limits, and quality of business;

(5) "compliance officer" means a licensee designated for a specific line and class of authority under this chapter who is responsible for a firm's compliance with the insurance statutes and regulations of this state;

(6) "control," "controlling," and "controlled by" have the meaning given in AS 21.22.200 ;

(7) "controlled insurer" means an admitted insurer that is controlled, directly or indirectly, by an insurance producer;

(8) "controlling insurance producer" means an insurance producer that, directly or indirectly, controls an insurer;

(9) "firm" means an organization of two or more licensees acting in association with each other, either in a partnership, corporation, or otherwise, or an organization in which a single licensee has less than 50 percent ownership interest in the organization;

(10) "home state" means the District of Columbia or a state or territory of the United States in which an insurance producer maintains the producer's principal place of residence or principal place of business and is licensed to act as an insurance producer;

(11) "independent qualified actuary" means an actuary who is a member of the American Academy of Actuaries and who is not affiliated with, an employee, principal, the direct owner or indirect owner of, or in any way controlled by the insurer, managing general agent, reinsurance intermediary broker, or reinsurance intermediary manager;

(12) "individual" means a natural person required to be licensed under AS 21.27.010 ;

(13) "individual in the firm" means a natural person required to be licensed under AS 21.27.010 who is employed by a firm;

(14) "insurance holding company system" has the meaning given in AS 21.22.200;

(15) "insurance producer" means a person who sells, solicits, or negotiates insurance or insurance products;

(16) "interim profits" means the excess of income over expenses and claim reserves determined before the expiration of all claim liabilities and contract obligations of the insurer to the insured;

(17) "license" means, unless the context requires otherwise, a document issued by the director authorizing a person to act for the type, class, and lines of authority specified in the document;

(18) "limited lines credit insurance" includes credit life, credit disability, credit property, credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, guaranteed automobile protection insurance, and any other form of insurance offered in connection with an extension of credit that is limited to partially or wholly extinguishing that credit obligation that the director of insurance determines must be designated a form of limited lines credit insurance;

(19) "limited lines" means those lines of insurance defined in AS 21.27.150 or any other line of insurance that the director designates by order as a limited line;

(20) "negotiate" means the act of conferring directly with or offering advice directly to a purchaser or prospective purchaser of a particular contract of insurance concerning any of the substantive benefits, terms, or conditions of the contract if the person engaged in that act either sells insurance or obtains insurance from insurers for purchasers;

(21) "physical presence or physically present" means contemporaneously available in the licensee's place of business;

(22) "reinsurance" means an insurance transaction by which the assuming insurer agrees to indemnify the ceding insurer in whole or in part against liability or losses that the ceding insurer might incur under a separate contract of insurance with its insured;

(23) "resident" means

(A) for an individual or an individual in the firm, a natural person who is domiciled in this state, whose principal place of business is in this state, who has a present intent to remain in this state while licensed, and who manifests that intent by establishing an ongoing physical presence in this state;

(B) for a firm, a person whose principal place of business is in this state;

(24) "retrocession" means a transaction in which a reinsurer cedes to another reinsurer all or part of the risk that the reinsurer has previously assumed;

(25) "sells" means to exchange a contract of insurance by any means, for money or its equivalent, on behalf of an insurance company;

(26) "solicit" means attempting to sell insurance or asking or urging a person to apply for a particular kind of insurance from a particular company;

(27) "subagent" means an agent reporting to a managing general agent or reinsurance intermediary manager and not directly to an insurer;

(28) "subsidiary" has the meaning given in AS 21.22.200 ;

(29) "transact" or "transact business" means sell, solicit, or negotiate insurance or insurance products;

(30) "underwrite" means the authority to accept or reject risk on behalf of the insurer;

(31) "uniform application" means the most recent version of the uniform application of the National Association of Insurance Commissioners;

(32) "uniform business entity application" means the most recent version of the uniform business entity application of the National Association of Insurance Commissioners.