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ACT No. 94
Regular Session, 2011
HOUSE BILL NO. 283
BY REPRESENTATIVE AUBERT
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
AN ACT1
To amend and reenact R.S. 22:901(A), (B), (C)(1) and (3), and (D)(1)(introductory2
paragraph) and (a) and (2), 902, 904, 905, 906, 907, 910, 912(A), (B)(1), (C),3
(D)(1)(b), (E), and (F), 913, 914, 915(B), 931, 932(B)(introductory paragraph) and4
(1), (D)(introductory paragraph) and (2), and (E), 934, 935, 936(A)(1)(introductory5
paragraph) and (2), (B), (D)(1), (2), and (4), (E), (F)(1), (G)(1), (4), and6
(8)(introductory paragraph) and (b) and (d) through (g), (I)(1), (J)(1), (2), (3), and7
(5), (K)(1)(g) and (h), 941(B)(introductory paragraph) and (6), 942(introductory8
paragraph) and (1), (10)(b), and (11), 943(D)(2), 944(A), 951(A), 952(A)(2),9
(B)(introductory paragraph) and (4), and (J), 961, 1541, 1542(1), (4), (6), (9), (11),10
(14), and (18), 1544(B)(5) through (8) and (D), 1545(I)(1)(introductory paragraph),11
1546(A)(3), (D)(4), and (F), 1547(A)(10), (C)(2), (D), (E), (G), (H), and (I)(3),12
1548(A)(1) and (3), (B)(2) and (3)(b), (D)(2), and (E), 1549(B)(4) and (5), (C), (D),13
(E)(introductory paragraph), (F), and (H), 1550(A)(2), (B)(1) and (d) and (2), (C),14
(D), (E)(introductory paragraph), and (H), 1554(G), 1555, 1556(A), (B), and (C),15
1557(B)(1) and (2), 1558(B)(3) and (4), (C), and (D), 1559(C), (D)(1), and (E)(1),16
1562(C)(1)(b) and (d), (E)(2), and (H)(introductory paragraph) and (4), 1564(A)(2),17
(B)(1)(a), and (C), 1571, 1573(C) through (G), (I)(1)(a), (K), (L), and (M), 1574(A)18
through (D)(1), 1575(C)(2) and (D), 1583, the heading of R.S. 22:1584, 1585(C),19
1591, 1592, 1593(A)(introductory paragraph) and (1), 1594(introductory paragraph),20
1595, 1597, 1598(C), 1599(A) and (C)(introductory paragraph),21 ENROLLEDHB NO. 283
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1600(B)(introductory paragraph), 1603(1) and (3), 1604(A)(2), 1605, 1622, 1623(A),1
(B), (D), and (F), 1624, 1625(A) and (H), 1627(A)(2), the heading of Part III of2
Chapter 5 of the Louisiana Revised Statutes of 1950, 1641(introductory paragraph),3
(1)(introductory paragraph), (c), (g), and (j), (4), and (7), 1642(A) and (C), 1644(D),4
1651(B)(6), (D), (H)(1), and (I)(1), 1652, 1654(A)(introductory paragraph) and5
(C)(introductory paragraph), 1657, 1662(6)(a)(introductory paragraph) and (14),6
1664(A) and (C)(2), 1665(A)(introductory paragraph) and (1), 1669, 1670(A)(2) and7
(D), 1671(A), (B)(2), and (C), 1673(C), 1693(A), 1694(A), 1696(A), 1697,8
1698(A)(2) and (D), 1699(A)(3), (B), and (F), 1704(E)(1)(a) and (b), 1706(F), 1722,9
1723(A)(introductory paragraph), (B)(introductory paragraph) and (2), (D), and (F),10
1724(introductory paragraph) and (5), 1726(A) and (B), 1727(A)(introductory11
paragraph), (1), (2), (3), (4)(introductory paragraph), (7), and (8), (B)(4), (C), and12
(F), 1728(6), 1729(A) and (F), 1731(A)(2), 1741, 1747, 1761, 1763(B), 1767, and13
1768; to enact R.S. 22:821(B)(31), (32), and (33), 1557(C), 1641(8) and (9), and14
1766(C); and to repeal R.S. 22:1546(G) and (H), 1566, 1746(E), 1751, and 1769, all15
relative to technical recodification of certain provisions of the Louisiana Insurance16
Code, including correction of citations, updates of terms and language,17
reorganization of provisions, elimination of obsolete or ineffective provisions,18
harmonizing of inconsistent provisions, and consolidating all provisions authorizing19
fees; and to provide for related matters.20
Be it enacted by the Legislature of Louisiana:21
Section 1. R.S. 22:901(A), (B), (C)(1) and (3), and (D)(1)(introductory paragraph)22
and (a) and (2), 902, 904, 905, 906, 907, 910, 912(A), (B)(1), (C), (D)(1)(b), (E), and (F),23
913, 914, 915(B), 931, 932(B)(introductory paragraph) and (1), (D)(introductory paragraph)24
and (2), and (E), 934, 935, 936(A)(1)(introductory paragraph) and (2), (B), (D)(1), (2), and25
(4), (E), (F)(1), (G)(1), (4), and (8)(introductory paragraph) and (b) and (d) through (g),26
(I)(1), (J)(1), (2), (3), and (5), (K)(1)(g) and (h), 941(B)(introductory paragraph) and (6),27
942(introductory paragraph) and (1), (10)(b), and (11), 943(D)(2), 944(A), 951(A),28
952(A)(2), (B)(introductory paragraph) and (4), and (J), 961, 1541, 1542(1), (4), (6), (9),29
(11), (14), and (18), 1544(B)(5) through (8) and (D), 1545(I)(1)(introductory paragraph),30 ENROLLEDHB NO. 283
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1546(A)(3), (D)(4), and (F), 1547(A)(10), (C)(2), (D), (E), (G), (H), and (I)(3), 1548(A)(1)1
and (3), (B)(2) and (3)(b), (D)(2), and (E), 1549(B)(4) and (5), (C), (D), (E)(introductory2
paragraph), (F), and (H), 1550(A)(2), (B)(1) and (d) and (2), (C), (D), (E)(introductory3
paragraph), and (H), 1554(G), 1555, 1556(A), (B), and (C), 1557(B)(1) and (2), 1558(B)(3)4
and (4), (C), and (D), 1559(C), (D)(1), and (E)(1), 1562(C)(1)(b) and (d), (E)(2), and5
(H)(introductory paragraph) and (4), 1564(A)(2), (B)(1)(a), and (C), 1571, 1573(C) through6
(G), (I)(1)(a), (K), (L), and (M), 1574(A) through (D)(1), 1575(C)(2) and (D), 1583, the7
heading of R.S. 22:1584, 1585(C), 1591, 1592, 1593(A)(introductory paragraph) and (1),8
1594(introductory paragraph), 1595, 1597, 1598(C), 1599(A) and (C)(introductory9
paragraph), 1600(B)(introductory paragraph), 1603(1) and (3), 1604(A)(2), 1605, 1622,10
1623(A), (B), (D), and (F), 1624, 1625(A) and (H), 1627(A)(2), the heading of Part III of11
Chapter 5 of the Louisiana Revised Statutes of 1950, 1641(introductory paragraph),12
(1)(introductory paragraph), (c), (g), and (j), (4), and (7), 1642(A) and (C), 1644(D),13
1651(B)(6), (D), (H)(1), and (I)(1), 1652, 1654(A)(introductory paragraph) and14
(C)(introductory paragraph), 1657, 1662(6)(a)(introductory paragraph) and (14), 1664(A)15
and (C)(2), 1665(A)(introductory paragraph) and (1), 1669, 1670(A)(2) and (D), 1671(A),16
(B)(2), and (C), 1673(C), 1693(A), 1694(A), 1696(A), 1697, 1698(A)(2) and (D),17
1699(A)(3), (B), and (F), 1704(E)(1)(a) and (b), 1706(F), 1722, 1723(A)(introductory18
paragraph), (B)(introductory paragraph) and (2), (D), and (F), 1724(introductory paragraph)19
and (5), 1726(A) and (B), 1727(A)(introductory paragraph), (1), (2), (3), (4)(introductory20
paragraph), (7), and (8), (B)(4), (C), and (F), 1728(6), 1729(A) and (F), 1731(A)(2), 1741,21
1747, 1761, 1763(B), 1767, and 1768 are hereby amended and reenacted and R.S.22
22:821(B)(31), (32), and (33), 1557(C), 1641(8) and (9), and 1766(C) are hereby enacted to23
read as follows:24
§821. Fees25
* * *26
B. The following fees and licenses shall be collected in advance by the27
commissioner of insurance:28
* * *29 ENROLLEDHB NO. 283
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(31) Fee for application for insurance producer for specialty limited lines1
credit insurance.2
(a) Initial application if registering twenty or fewer3
employees ...................................$ 250.004
(b) Initial application if registering twenty-one or more5
employees ...................................$1,000.006
(c) Annual renewal fee if registering twenty or fewer7
employees ...................................$ 125.008
(d) Annual renewal fee if registering twenty-one or more9
employees ...................................$ 500.0010
(32) Fee for application for insurance producer for specialty limited lines11
motor vehicle title insurance line.12
(a) Initial application if registering twenty or fewer13
employees ...................................$ 250.0014
(b) Initial application if registering twenty-one or more15
employees ...................................$1,000.0016
(c) Fee for registration of employees, per employee up to17
twenty-five hundred dollars......................$ 20.0018
(d) Annual renewal fee if registering twenty or fewer19
employees ...................................$ 125.0020
(e) Annual renewal fee if registering twenty-one or more21
employees ...................................$ 500.0022
(33) Motor vehicle rental insurers.23
(a) Initial license application:24
(i) Twenty-six or more vehicles ..................$ 500.0025
(ii) Twenty-five or fewer vehicles ................$ 100.0026
(b) Renewal27
(i) Twenty-six or more vehicles ..................$ 250.0028
(ii) Twenty-five or fewer vehicles ................$ 50.0029
* * *30 ENROLLEDHB NO. 283
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§901. Insurable interest required; personal insurance; intentional acts exclusion1
A. Any individual of competent legal capacity may procure or effect an2
insurance contract upon his own life or body for the benefit of any person; But3
however, no person shall procure or cause to be procured any insurance contract4
upon the life or body of another individual unless the benefits under such contract5
are payable to the individual insured or his personal representatives, or to a person6
having, at the time when such contract was made, an insurable interest in the7
individual insured.8
B. If the beneficiary, assignee , or other payee under any contract made in9
violation of this Section receives from the insurer any benefits thereunder under the10
contract accruing upon the death, disablement, or injury of the individual insured, the11
individual insured or his executor or administrator, as the case may be, may maintain12
an action to recover such benefits from the person so receiving them.13
C. "Insurable interest" as used in this Section and in R.S. 22:856 includes14
only interest as follows:15
(1) In the case of individuals related closely by blood or by law, a substantial16
interest engendered by love and affection ; and. 17
* * *18
(3) An individual, A person, or entity heretofore or hereafter party to an19
agreement, contract, or option for the purchase or sale of a business or a firm or20
immovable property owned by a business or firm, or an interest therein or of shares21
of stock of a closed corporation or of an interest in such shares, has an insurable22
interest in the life of each individual party to such agreement, contract, or option,23
each individual shareholder of such closed corporation or each individual24
shareholder of a corporation, individual partner of a partnership, or individual25
member of a limited liability company owning such property, business, firm, or26
shares of stock for the purposes of such agreement, contract, or option, only, in27
addition to any insurable interest which may otherwise exist as to the life of such28
individual party or individual shareholder.29 ENROLLEDHB NO. 283
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D.(1) No beneficiary, assignee, or other payee under any personal insurance1
contract shall receive from the insurer any benefits thereunder under the contract2
accruing upon the death, disablement, or injury of the individual insured when said3
the beneficiary, assignee, or other payee is : either:4
(a) Held by a final judgment of a court of competent jurisdiction to be5
criminally responsible for the death, disablement, or injury of the individual insured;6
or.7
* * *8
(2) Where such a disqualification exists, the policy proceeds shall be payable9
to the secondary or contingent beneficiary, unless similarly disqualified, or, if no10
secondary or contingent beneficiary exists, to the estate of the insured. Provided,11
that nothing Nothing contained herein in this Section shall prohibit payment pursuant12
to an assignment of the policy proceeds where such payment defrays the cost and13
expenses of the insured's funeral or expense incurred in connection with medical14
treatment of the insured. Provided, also, that nothing Nothing contained herein in15
this Section shall prohibit payment of insurance proceeds pursuant to a facility of16
payment clause, so long as such payment is not made to a beneficiary, assignee, or17
other payee disqualified by this Section.18
* * *19
§902. Statutory life insurance beneficiaries 20
Notwithstanding any other law or regulation to the contrary, any religious,21
educational, eleemosynary, charitable, or benevolent institution or undertaking may22
be named beneficiary in or owner of any policy of life insurance issued by any life23
insurance company upon the life of any individual. The beneficiaries or owners24
aforenamed named shall have an insurable interest for the full face of the policy and25
shall be entitled to collect same. On all policies of life insurance issued before26
August 21, 1992, by insurers in which any of the aforenamed named beneficiaries27
or owners shall have been designated beneficiaries in the policies, said the28 ENROLLEDHB NO. 283
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beneficiaries shall have an insurable interest to the full extent of the face of the1
policy and be entitled to collect same, without penalty or deduction.2
* * *3
§904. Ante-dating of life insurance policies prohibited 4
No insurer shall knowingly deliver or issue for delivery in this state any5
policy or contract of life insurance which purports to be issued or to take effect as6
of a date more than six months before the application therefor was made, if thereby7
the premium on such policy or contract is reduced below the premium which would8
be payable thereon as determined by the nearest birthday of the insured at the time9
when such application was made. No agent producer or other representative of an10
insurer shall in this state prepare, submit, or accept any application for life insurance11
which bears a date earlier than the date when such application was made by the12
insured or applicant, if thereby the premium on such policy is reduced as above13
stated. in this Section. Nothing contained in this Section shall invalidate any contract14
made in violation of this Section. This Section shall not be construed to prohibit the15
exchange, alteration, or conversion of policies of life insurance as of the original date16
of such policies if the amount of insurance provided under the new policy does not17
exceed the amount of insurance under the original policy or the amount of insurance18
which the premium paid for the original policy would have purchased if the new19
policy had been originally applied for, whichever is greater;, nor to prohibit the20
exercise of any conversion privilege contained in any policy or contract.21
§905. Written notice required before lapsing life policies 22
A. No life insurer shall within one year after default in payment of any23
premium, installment, loan, or interest, declare forfeited or lapsed any policy issued24
or renewed, and not issued upon the payment of monthly or weekly premiums or for25
a term of one year or less, for non-payment nonpayment when due of any premium,26
installment, loan, or interest, or any portion thereof required by the terms of the27
policy to be paid, unless a written or printed notice stating: 28
(1) The amount of such premium, installment, loan or interest, or portion29
thereof due on such policy; and 30 ENROLLEDHB NO. 283
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(2) The place where it shall be paid and the person to whom the same is1
payable, shall have been duly addressed and mailed to the owner of the policy and2
the assignee of the policy if notice of the assignment has been given to the insurer,3
at the last known post office address of such insured or assignee, postage prepaid by4
the insurer or any person appointed by it to collect such payment, at least fifteen and5
not more than forty-five days prior to the date when the same is payable. Such6
notice shall state both of the following:7
(1) The amount of such premium, installment, loan, or interest, or portion8
thereof due on such policy.9
(2) The place where it shall be paid and the person to whom the same is10
payable.11
B. No policy shall in any case be forfeited or declared forfeited or lapsed12
until the expiration of thirty days after the mailing of such notice. Any payment13
demanded by such the notice and made within the time limit shall be taken to be full14
compliance fully compliant with the requirements of the policy in respect to the time15
of such the payment.16
C. The affidavit of any officer, clerk , or agent representative of the insurer17
or of anyone authorized to mail such notice that the notice required by this section18
Section has been duly addressed and mailed by the insurer issuing such policy, shall19
be presumptive evidence that such notice has been duly given. No action shall be20
maintained to recover under a forfeited policy, unless the same is instituted within21
two years from the day upon which default was made in paying the premium,22
installment, interest or portion thereof for which it is claimed that forfeiture ensued.23
D. This Section shall not apply to group life insurance policies.24
§906. Mortality endowments prohibited 25
A. No life insurer, (including industrial, service, non-profit nonprofit funeral26
associations, and fraternal benefit societies), shall be permitted to issue policies,27
certificates, or contracts to policyholders or members stipulating for the28
establishment of its policyholders or members into divisions and classes for the29
purpose of providing for the payment of benefits from special funds created for such30 ENROLLEDHB NO. 283
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purpose to the oldest member of the division and class or to the member of the1
division and class whose policy has been in force the longest period of time upon the2
death of the member in such division and class, except as provided in Subsection B3
of this Section.4
B. Any life insurer specified in Subsection A of this Section heretofore5
operating on the plan specified in Subsection A of this Section in this state since6
before October 1, 1948, may continue so to do operate upon condition that such life7
insurer shall not after that date establish its policyholders or members into divisions8
or classes other than the divisions or classes actually containing subsisting policies9
or certificates as of July 28th, 28, 1936.10
§907. Benefits required by domiciliary state ; -- Louisiana residents entitled to11
Every policy of life insurance and every benefit contract issued by any alien12
or foreign insurer to an insured or beneficiary who is a citizen or resident of this state13
at the time the policy was issued, shall as to all rights, privileges, or duties of the14
insurer, the insured, or the beneficiary therein, be so interpreted, performed, and15
enforced as to give accord and extend to such insured or beneficiary named therein16
and all parties legally represented or claiming through such original parties, the17
benefit of all legislative or legal enactments of any sort within the state, territory, or18
country where the insurer issuing such policy or contract is domiciled.19
* * *20
§910. Life insurance and annuities; replacement21
Rules and regulations concerning replacement of life insurance and annuities22
as provided in R.S. 22:47(1) and (17) shall be promulgated by the commissioner. by23
July 1, 2000.24
* * *25
§912. Exemption of proceeds; life, endowment, annuity26
A.(1) The lawful beneficiary, assignee, or payee, including the insured's27
estate, of a life insurance policy or endowment policy, heretofore or hereafter28
effected shall be entitled to the proceeds and avails of the policy against the creditors29
and representatives of the insured and of the person effecting the policy or the estate30 ENROLLEDHB NO. 283
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of either, and against the heirs and legatees of either such person, and such proceeds1
and avails shall also be exempt from all liability for any debt of such the beneficiary,2
payee, or assignee or estate, existing at the time the proceeds or avails are made3
available for his own use. For purposes of this Subsection, the proceeds and avails4
of the policy include the cash surrender value of the policy.5
(2) The exemption authorized in Subsection (A) Paragraph (1) of this6
Subsection from seizure under any writ, mandate, or process issued by any court of7
competent jurisdiction, including any bankruptcy proceedings, shall not apply to that8
portion of the cash surrender value, or loan value of any life insurance policy,9
endowment policy, or annuity contract payable upon surrender during the lifetime10
of the insured or annuitant which exceeds the sum of thirty-five thousand dollars if11
such policy or contract was issued within nine months of issuance of such writ,12
mandate, or process or the filing of a voluntary or involuntary bankruptcy proceeding13
under the United States Code. However, an insurer shall be liable only for such14
amounts that exceed the thirty-five thousand dollar exemption which are in the15
insurer's possession at the time the insurer receives, at its home office, written notice16
by or on behalf of a creditor of claims being made against such value or interest with17
specification of the amount claimed. The insurer shall have no obligation to18
determine the validity or the accuracy of the amount of the claim and shall be19
relieved of further liability of any kind with respect to the monies paid upon such20
request of a creditor. An insurer shall be entitled to be paid by preference and21
priority over the claim of any such seizing creditor the balance of any bona fide loan22
to such the insured or owner which is secured by such interest or value in such the23
policy or contract.24
B.(1) The lawful beneficiary, assignee, or payee, including the annuitant's25
estate, of an annuity contract, heretofore or hereafter effected, shall be entitled to the26
proceeds and avails of the contract against the creditors and representatives of the27
annuitant or the person effecting the contract, or the estate of either, and against the28
heirs and legatees of either such person, saving the rights of forced heirs, and such29
the proceeds and avails shall also be exempt from all liability for any debt of such30 ENROLLEDHB NO. 283
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the beneficiary, payee, or assignee or estate, existing at the time the proceeds or1
avails are made available for his own use.2
* * *3
C. The lawful beneficiary designated in an Education Assistance Account4
depositor's agreement to receive account funds in the event of the account owner's5
death, including the account owner's estate, of the funds contained in an Education6
Assistance Account established pursuant to R.S. 17:3095, heretofore or hereafter7
effected, shall be entitled to the proceeds and avails of the Education Assistance8
Account against the creditors and representatives of the account owner or the person9
effecting the account, or the estate of either, and against the heirs and legatees of10
either such person, saving the rights of forced heirs, and such the proceeds and avails11
shall also be exempt from all liability for any debt of such the beneficiary or estate12
existing at the time the proceeds and avails are made available for his own use.13
D.(1) The provisions of Subsections A, B, and C of this Section shall apply:14
* * *15
(b) Whether or not the policy, contract, or Education Assistance Account16
depositor's agreement is made payable to the person whose life is insured, to his17
estate, or to the estate of an annuitant or to the estate of an Education Assistance18
Account owner if the beneficiary, assignee or payee shall predecease such the19
person.20
* * *21
E. No person shall be compelled to exercise any rights, powers, options, or22
privileges under any such policy, contract, or Education Assistance Account23
depositor's agreement.24
F. There shall be excepted from the provisions of this Section a debt secured25
by a pledge of a policy, any rights under such the policy that may have been26
assigned, and any advance payments made on or against such the policy.27
§913. Policies payable to estate; effect of renunciation 28
In all policies of life or endowment insurance and in all annuity contracts29
where the estate of the insured or annuitant is a beneficiary or payee, the widow, or30 ENROLLEDHB NO. 283
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heir, or heirs of the insured or annuitant decedent shall be entitled to the proceeds of1
such the policies or contracts according to the laws of distribution affecting the2
succession of the decedent even though they have renounced his succession with the3
same effect as if said the renunciation had not taken place.4
§914. Requirements of variable life and variable annuities5
Except for R.S. 22:951(A)(1), (6), and (7) in the case of a variable annuity6
contract and R.S. 22:931(A)(1), (7), and (9), R.S. 22:933, 934, 935, and 936 in the7
case of an individual variable life insurance contract, and R.S. 22:942(3) in the case8
of a group variable life insurance contract and except as otherwise provided in9
Subpart C of Part IV of Chapter 2 of this Title, all pertinent provisions of the10
insurance laws of this state shall apply to separate accounts and contracts relating11
thereto. Any individual variable life insurance contract, delivered or issued for12
delivery in this state shall contain grace, reinstatement and nonforfeiture provisions13
appropriate to such a the contract; any such group variable life insurance contract14
shall contain a grace provision appropriate to such a the contract and any such15
variable annuity contract shall contain grace, reinstatement, and nonforfeiture16
provisions appropriate to such a that contract.17
§915. Donations inter vivos of life insurance policies; laws respecting form18
inapplicable 19
* * *20
B. This section Section is remedial and retrospective. All donations inter21
vivos of life insurance policies made on or before July 31, 1968 , are valid and22
effective, whether or not such donations were made in the form prescribed by the23
Civil Code or by any other laws of this state.24
* * *25
§931. Life insurance policies; standard provisions26
A. No policy of life insurance, except as stated in Subsection C, of this27
Section, shall be delivered or issued for delivery in this state unless it contains in28
substance the following provision or provisions which, in the opinion of the29
commissioner of insurance, are more favorable to the policyholder:30 ENROLLEDHB NO. 283
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(1) Grace period. A provision that the insured is entitled to a grace period1
either of thirty days or, at the option of the insurer, of one month within which the2
payment of any premium after the first may be made, during which period of grace3
the policy shall continue in full force, but if a claim arises under the policy during4
such the period of grace before the overdue premiums or the deferred premiums of5
the current policy year, if any, are paid, the amount of such premiums, together with6
interest, not in excess of six per cent percent per annum, on any overdue premium,7
may be deducted from any amount payable under the policy in settlement.8
(2) Incontestability. A provision that the policy shall be incontestable after9
it has been in force during the lifetime of the insured for a period of two years from10
its date of issue, except for non-payment nonpayment of premiums and except for11
the conditions of the policy relating to military or naval service, or services auxiliary12
thereto; and at the option of the insurer, provisions relating to benefits in the event13
of disability, as defined in the policy, and provisions which grant additional14
insurance specifically against death by accident or accidental means, may also be15
excepted.16
(3) Entire contract. A provision that the policy shall constitute the entire17
contract between the parties, or if a copy of the application is endorsed upon or18
attached to the policy when issued, a provision that the policy and the application19
therefor shall constitute the entire contract between the parties.20
(4) Misstatement of age. A provision that if the age of the person insured or21
the age of any other person whose age is considered in determining the premiums has22
been misstated, any amount payable or benefit accruing under the policy shall be23
such as the premium would have purchased at the correct age, or ages.24
(5) A Participating policy. If the policy is a participating policy, a provision25
that the insurer shall annually ascertain and apportion any divisible surplus accruing26
on the policy.27
(6) Nonforfeiture options. A provision in accordance with R.S. 22:93428
through 936 specifying the options, if any, available under the policy in the event of29
default in a premium payment.; Provided, however, however, the mortality table and30 ENROLLEDHB NO. 283
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rate of interest used as a basis for the calculation of such the options shall be1
designated by the policy.2
(7) Policy loan. A provision that when the policy has a loan value, the3
insurer issuing it shall advance at the option of the person entitled thereto, a sum4
equal to or less than the cash surrender value of the policy at the end of the current5
policy year computed in accordance with the provisions of this Subpart, at any time6
while the policy is in force, on proper assignment or pledge of the policy or with the7
policy as security at a specified rate of interest not exceeding eight per centum8
percent per annum on policy contracts in effect prior to September 10, 1982, or in9
accordance with the provisions of R.S. 22:932 on policy contracts in effect on or10
after September 10, 1982. The interest shall be compounded annually payable in11
advance. The policy shall also contain a provision that the insurer may deduct from12
such the loan value, in addition to the indebtedness deducted in determining such13
value, any unpaid balance of the premium for the current policy year. The policy14
shall also contain a provision that, if the loan is made or repaid on a date other than15
the anniversary of the policy, the insurer may collect interest for the portion of the16
current policy year on a pro rata basis at the rate of interest specified in the policy.17
The policy may further provide that interest on the loan may be compounded18
annually and, if not paid when due, it shall be added to the existing loan and shall19
bear interest at the same rate. The policy may further provide that, if and when the20
total indebtedness on the policy, including interest due or accrued, equals, or exceeds21
the amount of the loan value thereof at such time, and if at least thirty days prior22
notice has been given in the manner provided in R.S. 22:905, then the policy shall23
terminate and become void. The insurer may provide in the policy that the making24
of any such loan, except when made to pay premiums, may be deferred for a period25
not to exceed six months after the application therefor has been received by it. The26
provision shall not apply to term policies of twenty years or less.27
(8) Nonforfeiture benefits. A provision specifying the basis used in28
determining non-forfeiture nonforfeiture benefits. In case the proceeds of the policy29 ENROLLEDHB NO. 283
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are payable in installments or as an annuity, a table showing the amounts of the1
installments or annuity payments.2
(9) Reinstatement. A provision that the policy will be reinstated at any time3
within three years from the date of default, unless the cash surrender value has been4
exhausted by payment or unless the period of extended insurance has expired, upon5
the application of the insured and the production of evidence of insurability,6
including good health, satisfactory to the insurer and the payment of all overdue7
premiums and the payment or reinstatement of any other indebtedness to the insurer8
upon said such policy with the interest at a rate not exceeding six per centum percent9
per annum compounded annually.10
(10) Free look period. (a) A provision, prominently printed on the life11
insurance policy or attached thereto, notifying the insured that ten days are allowed,12
from the date of his receipt of the policy, to examine its provisions. If the policy is13
not as explained by the company, its representative, or as understood by the insured,14
the policy may be surrendered within said the ten-day period, and any premium15
advanced by the insured, upon the surrender, shall be immediately returned to him.16
The insurer shall have the option of printing, attaching, or endorsing the notice above17
required in this Subparagraph or a notice of equal prominence which, in the opinion18
of the commissioner of insurance, is not less favorable to the policyholder. This19
Paragraph Subparagraph shall not apply to trip-travel insurance policies which by20
their terms are not renewable.21
(b) If the policy is delivered by an agent or broker, a producer, a receipt shall22
be signed by the policyholder acknowledging delivery of the policy. The receipt23
shall contain the policy number and the date the delivery was completed. All24
delivery receipts required by this Subparagraph shall be retained by the insurer or its25
agent or the broker producer for two consecutive years. The requirement of this26
Subparagraph shall not apply to any insurer that markets policies under a home27
service marketing distribution method and that issues a majority of its policies on a28
weekly or monthly basis.29 ENROLLEDHB NO. 283
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(c) If the policy is delivered by mail, it shall be sent by certified mail, return1
receipt requested, or a certificate of mailing shall be obtained showing the date the2
policy was mailed to the policyowner. For policy issuances verified by a certificate3
of mailing, it is presumed that the policy is received by the policyowner ten days4
from the date of mailing. The receipts and the certificate of mailing described in this5
Section shall be retained by the insurer or agent producer for three two years.6
(11) Lump sum payment. A provision which allows election by the7
beneficiary of an option to receive benefits in the form of a lump sum payment. This8
Paragraph shall not apply to policies of industrial life insurance or service insurance.9
B. Exclusions and restrictions. No policy of life insurance delivered or10
issued for delivery in this state shall contain any provision which excludes or11
restricts liability for death caused in a certain specified manner or occurring while12
the insured has a specified status, except the following provisions, or provisions13
which in the opinion of the commissioner of insurance are substantially the same or14
more favorable to policyholders:15
(1) Provisions excluding or restricting coverage in the event of death16
occurring:17
(1) (a) As a result of war declared or undeclared under conditions specified18
in the policy.19
(2) (b) While either in: 20
(a) (i) the The military, naval, or air forces of any country at war, declared or21
undeclared, or.22
(b) (ii) any Any ambulance, medical, hospital, or civilian noncombatant unit23
serving with such forces, either while serving with or within six months after24
termination of service in such forces or units.25
(3) (c) As a result of self-destruction while sane or insane within two years26
from the date of issue of the policy.27
(4) (d) As a result of aviation under conditions specified in the policy.28 ENROLLEDHB NO. 283
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(5) (e) Within two years from the date of issue of the policy as a result of a1
specified hazardous occupation or occupations, or while the insured is residing in a2
specified foreign country or countries.3
(2) In the event of death as to which there is an exclusion or restriction4
pursuant to Paragraphs (1), (3), (4), or (5) Subparagraph (1)(a), (c), (d), or (e) of this5
Subsection, the insurer shall pay an amount not less than the reserve on the face6
amount of the policy, together with the reserve for any paid-up additions thereto, and7
any dividends standing to the credit of the policy, less any indebtedness to insurer8
on the policy, including interest due or accrued.9
(3) In the event of death as to which there is an exclusion or restriction10
pursuant to Paragraph (2) Subparagraph (1)(b) of this Subsection, the insurer shall11
pay the greater of:12
(a) the (i) The amount specified in the preceding paragraph; or Paragraph (2)13
of this Subsection.14
(b) the (ii) The amount of the gross premiums charged on the policy less15
dividends paid in cash or used in the payment of premiums thereon and less any16
indebtedness to the insurer on the policy, including interest due or accrued.17
(4) A clause in any policy of life insurance, issued under this Code,18
providing that such policy shall be incontestable after a specified period shall19
preclude only a contest of the validity of the policy, and shall not preclude the20
assertion at any time of defenses based upon provisions which exclude or restrict21
coverage as provided in this Subsection, whether or not such restrictions or22
exclusions are excepted in such clause; nor upon a provision regarding misstatement23
of age as provided in Paragraph (4) of Subsection A of this Section, whether or not24
such provision is excepted in such clause.25
(5) Nothing contained herein in this Subsection shall apply to any provision26
in a life insurance policy for additional benefits in the event of death by accident or27
accidental means.28
C. Any of the foregoing provisions or portions thereof of this Section not29
applicable to single premium or non-participating nonparticipating or term policies,30 ENROLLEDHB NO. 283
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shall to that extent not be incorporated therein. The provisions of this Section shall1
not apply to policies of industrial life insurance, service insurance, or to policies of2
group life insurance.3
D. Every life insurance policy delivered or issued for delivery in this state,4
other than policies of industrial life insurance or service insurance, shall allow5
election by the beneficiary of an option to receive benefits in the form of a lump sum6
payment.7
§932. Maximum rate of interest on policy loans 8
* * *9
B. The rate of interest charged on a policy loan made under Paragraph (2)10
of Subsection A of this Section shall not exceed the higher of: the following: 11
(1) The published monthly average for the calendar month ending two12
months prior to the date on which the rate is determined; or. 13
* * *14
D. The maximum rate for each policy referred to in Paragraph (2) of15
Subsection A of this Section shall be determined at regular intervals at least once16
every twelve months, but not more frequently than once in any three month three-17
month period. At the intervals specified in the policy: 18
* * *19
(2) The rate being charged shall be reduced whenever such reduction, as20
determined under Subsection B of this Section, would decrease that rate by one-half21
of one percent of or more per annum.22
E. The insurer shall, at the time a cash loan is made, notify the policyholder23
of the initial rate of interest on the loan, and shall notify the policyholder of the24
initial rate of interest on the premium loan as soon as it is reasonably practical to do25
so after making the initial loan. Such notice need not be given to the policyholder26
when a further premium loan is added except as otherwise provided below. in this27
Subsection. The insurer shall send reasonable advance notice of any increase in the28
rate to policyholders with loans, and include in the notices required above, in this29 ENROLLEDHB NO. 283
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Subsection, the substance of the pertinent provisions of Subsections A and C of this1
Section.2
* * *3
§934. Policies to contain non-forfeiture nonforfeiture benefits4
Every contract or policy of life or endowment insurance policy, (other than5
a term life policy for twenty years or less and policies an industrial life insurance6
policy with coverage of one thousand two hundred fifty dollars or less issued as7
industrial policies under the provisions of pursuant to R.S. 22:146), issued on the life8
of a resident of this state or delivered within this state by any insurer, on or after9
January 1, 1937, unless the company elects to take advantage of the exercises its10
option provided in R.S. 22:936(H), shall contain a stipulation require that after three11
full annual premiums have been paid, thereon it shall not lapse or become void or be12
forfeited for non-payment of any premium thereafter, or of any note therefor, or of13
any loan on such policy, or of any interest on such note or loan, the policy shall not14
be forfeited without value for the nonpayme nt of any subsequent premiums or for15
policy loan indebtedness or the interest thereon except as provided in R.S. 22:935.16
§935. Paid-up, extended insurance and cash value17
No such policy of Every life or endowment insurance policy, (other than a18
term life policy for twenty years or less and an policies of industrial life insurance19
policy with coverage of one thousand two hundred fifty dollars or less, pursuant to20
the provisions of R.S. 22:146), issued by any legal reserve life insurer on or after21
January 1, 1907, by a legal reserve life insurance company, after being in force for22
three full years, shall not be forfeited without value for the nonpayment of any23
subsequent premiums or for policy loan indebtedness or the interest thereon, unless24
the company elects to take advantage of the exercises its option provided in R.S.25
22:936(H),. after being in force three full years shall by its terms lapse or become26
forfeited by the nonpayment of any premium, or any note therefor, or of any loan on27
such policy, or of any interest on such note or loan. The reserve on such policy28
computed according to the standard adopted by said insurer, together with the value29
of any dividend additions upon said policy after deducting any indebtedness to the30 ENROLLEDHB NO. 283
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company and after deducting one-fifth of the said entire reserve or the sum of two1
and fifty-one hundredths dollars for each one hundred dollars of the face of said2
policy if said sum shall be more than the said one-fifth, shall upon demand, with3
surrender of the policy, be applied as a surrender value as agreed upon in the policy;4
provided that, if no other option expressed in the policy be availed of by the owner5
thereof, the policy shall provide for said value to be applied to the automatic option6
shown in the policy which automatic option shall be one of the following, either to7
purchase upon the same life, at the attained age, paid-up insurance, payable at the8
same time, and under the same conditions, except as to the payment of premiums,9
as the original policy, or to continue the insurance in force at its full amount,10
including any outstanding dividend additions, less any outstanding indebtedness on11
the policy, so long as such surrender value will purchase nonparticipating temporary12
insurance at net single premium rates by the standard adopted by the insurer, at the13
age of the insured at the time of lapse or forfeiture, provided that in case of any14
endowment policy, if the sum applicable to the purchase of temporary insurance be15
more than sufficient to continue the insurance to the end of the endowment term16
named in the policy, the excess shall be used to purchase, in the same manner, pure17
endowment insurance payable at the end of the endowment term named in the policy18
on the conditions on which the original policy was issued; and provided further that,19
in calculating the The nonforfeiture value per hundred dollars of coverage under the20
policy is determined as the sum of the legal reserve and accumulated dividends, less21
any policy loan indebtedness and a surrender charge equal to the greater of one-fifth22
of the legal reserve or two dollars and fifty cents. Unless the policy owner elects one23
of the other nonforfeiture options within the policy, the nonforfeiture value as24
determined in this Section shall be applied towards the policy’s automatic25
nonforfeiture option. The automatic nonforfeiture option shall be the purchase of26
paid up life or endowment insurance on the same life at the age at the time of27
forfeiture and under the same terms, except as to the payment of premiums, as the28
original policy, or to continue the insurance in force at its full amount, including the29
amount of accumulated dividends, less any existing policy loan indebtedness;30 ENROLLEDHB NO. 283
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however, such surrender value will purchase nonparticipating temporary insurance1
at net single premium rates using the standard as prescribed by the insurer, at the age2
at the time of forfeiture, provided that in the case of an endowment policy, if the sum3
needed to purchase temporary insurance is more than that needed to continue the4
insurance to the end of the policy's endowment term, the excess shall be used to5
purchase pure endowment insurance payable at the end of the policy's endowment6
term using the purchase rates as prescribed by the insurer. When determining the net7
single premium rates for any temporary insurance, the insurer may use one hundred8
thirty percent of the rate of reserve mortality assumption adopted as a basis for9
reserve for the policy as the mortality rate. This further provision shall not apply to10
any mortality table constructed on the basis of insurance companies company11
experience prior to 1900. Provided, further, that any Any attempted waiver of the12
provisions of this paragraph Section in any application, policy, or otherwise shall be13
void, and that any value allowed in lieu thereof shall be at least equal to the net value14
of the temporary and or pure endowment insurance as provided herein in this Section15
provided for. The term of temporary insurance herein provided in this Section for16
shall include the period of grace, if any.17
§936. Standard nonforfeiture law for life insurance 18
A.(1) This Section shall be known as the "Standard Nonforfeiture Law for19
Life Insurance". In the case of policies issued on and after the effective date of this20
Section, as defined in Subsection L hereof, of this Section, no policy of life21
insurance, except as stated in Subsection K of this Section shall be delivered or22
issued for delivery in this state unless it shall contain in substance the following23
provisions, or corresponding provisions which in the opinion of the commissioner24
are at least as favorable to the defaulting or surrendering policyholder as are the25
minimum requirements hereinafter specified and are essentially in compliance with26
in Subsection J of this Section: 27
* * *28 ENROLLEDHB NO. 283
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(2)(a) Any of the foregoing provisions, or portions thereof, of Paragraph (1)1
of this Subsection not applicable by reason of because of the structure of the plan of2
insurance may, to the extent inapplicable, be omitted from the policy.3
(b) Notwithstanding any other provisions to the contrary, the insurer shall4
reserve the right to defer the payment of any cash surrender value for a period not to5
exceed six months after demand therefor with surrender of the policy.6
Notwithstanding the above this provision, if payment is not made within thirty days7
after demand therefor with surrender of the policy, the insurer shall pay, in addition8
to the cash surrender value, interest on the cash surrender value at the judicial9
interest rate set by Louisiana Civil Code Article 2924 R.S. 9:3500 commencing from10
the date of surrender until the cash surrender value is paid in full within the six-11
month period.12
B.(1) Any cash surrender value available under the policy in the event of13
default in a premium payment due on any policy anniversary, whether or not14
required by Subsection A, of this Section, shall be an amount not less than the15
excess, if any, of the present value on such anniversary of the future guaranteed16
benefits which would have been provided for by the policy, including any existing17
paid-up additions, if there had been no default, over the sum of the then present value18
of the adjusted premiums as defined in Subsections D, E, F, and G of this Section19
corresponding to premiums which would have fallen due on and after such20
anniversary, and the amount of any indebtedness to the insurer on the policy.21
(2) Provided, however, that However, for any policy issued on or after the22
effective date of Subsection G of this Section as defined therein, which provides23
supplemental life insurance or annuity benefits at the option of the insured and for24
an identifiable additional premium by rider or supplemental policy provision, the25
cash surrender value referred to in the first paragraph Paragraph (1) of this26
Subsection shall be an amount not less than the sum of the cash surrender value as27
defined in such paragraph Paragraph for an otherwise similar policy issued at the28
same age without such rider or supplemental policy provision and the cash surrender29 ENROLLEDHB NO. 283
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value as defined in such paragraph Paragraph for a policy which provides only the1
benefits otherwise provided by such rider or supplemental policy provision.2
(3) Provided, further, that However, for any family policy issued on or after3
the effective date of Subsection G of this Section as defined therein, which defines4
a primary insured and provides term insurance on the life of the spouse of the5
primary, insured expiring before the spouse's age of seventy-one , years, the cash6
surrender value referred to in the first paragraph Paragraph (1) of this Subsection7
shall be an amount not less than the sum of the cash surrender value as defined in8
such paragraph Paragraph for an otherwise similar policy issued at the same age9
without such term insurance on the life of the spouse and the cash surrender value10
as defined in such paragraph Paragraph for a policy which provides only the benefits11
otherwise provided by such term insurance on the life of the spouse.12
(4) Any cash surrender value available within thirty days after any policy13
anniversary under any policy paid-up by completion of all premium payments or any14
policy continued under any paid-up nonforfeiture benefit, whether or not required by15
Subsection A, of this Section, shall be an amount not less than the present value, on16
such anniversary, of the future guaranteed benefits provided for by the policy,17
including any existing paid-up additions, decreased by any indebtedness to the18
insurer on the policy.19
* * *20
D.(1)(a) This Subsection shall not apply to policies issued on or after the21
effective date of Subsection G of this Section as defined therein. Except as provided22
in the third paragraph Paragraph (3) of this Subsection, the adjusted premiums for23
any policy shall be calculated on an annual basis and shall be such uniform24
percentage of the respective premiums specified in the policy for each policy year,25
excluding extra premiums on substandard policies, that the present value, at the date26
of issue of the policy, of all such adjusted premiums shall be equal to the sum of: all27
of the following:28
(a) the (i) The then present value of the future guaranteed benefits provided29
for by the policy;. 30 ENROLLEDHB NO. 283
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(b) two (ii) Two percent of the amount of insurance, if the insurance be1
uniform in amount, or of the equivalent uniform amount, as hereinafter defined, if2
the amount of insurance varies with duration of the policy;. 3
(c) forty (iii) Forty percent of the adjusted premium for the first policy year;4
and. 5
(d) twenty-five (iv) Twenty-five percent of either the adjusted premium for6
the first policy year or the adjusted premium for a whole life policy of the same7
uniform or equivalent uniform amount with uniform premiums for the whole of life8
issued at the same age for the same amount of insurance, whichever is less. 9
(b) In applying the percentages specified in (c) Items (a)(iii) and (d) above,10
(iv) of this Paragraph, no adjusted premium shall be deemed to exceed four percent11
of the amount of insurance or uniform amount equivalent thereto. The date of issue12
of a policy for the purpose of this Subsection shall be the date from which the first13
policy anniversary is computed.14
(2) In the case of a policy providing an amount of insurance varying with15
duration of the policy, the equivalent uniform amount thereof for the purpose of this16
Subsection shall be deemed to be the uniform amount of insurance provided by an17
otherwise similar policy, containing the same endowment benefit or benefits, if any,18
issued at the same age and for the same term, the amount of which does not vary19
with duration and the benefits under which have the same present value at the date20
of issue as the benefits under the policy.; Provided, however, that however, in the21
case of a policy providing a varying amount of insurance issued on the life of a child22
under age ten, the equivalent uniform amount may be computed as though the23
amount of insurance provided by the policy prior to the attainment of age ten were24
the amount provided by such policy at age ten.25
* * *26
(4) Except as otherwise provided in Subsections E, and F, and G of this27
Section, all adjusted premiums and present values referred to in this Section shall for28
all policies of ordinary insurance be calculated on the basis of the Commissioners29
1941 Standard Ordinary Mortality Table; provided that for any category of ordinary30 ENROLLEDHB NO. 283
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insurance issued on female risks, adjusted premiums and present values may be1
calculated according to an age not more than three years younger than the actual age2
of the insured and such calculations for all policies of industrial insurance, as defined3
in R.S. 22:141, shall be made on the basis of the 1941 Standard Industrial Mortality4
Table. All calculations shall be made on the basis of the rate of interest, not5
exceeding three and one-half percent per annum, specified in the policy for6
calculating cash surrender values and paid-up nonforfeiture benefits.; Provided,7
however, that however, in calculating the present value of any paid-up term8
insurance with accompanying pure endowment, if any, offered as a nonforfeiture9
benefit, the rates of mortality assumed may be not more than one hundred and thirty10
percent of the rates of mortality according to such applicable table.; Provided,11
further, that however, for insurance issued on a substandard basis, the calculation of12
any such adjusted premiums and present values may be based on such other table of13
mortality as may be specified by the insurer and approved by the commissioner.14
E.(1) This Subsection shall not apply to ordinary policies issued on or after15
the effective date of Subsection G of this Section as defined therein. In the case of16
ordinary policies issued on or after the effective date of this Subsection as defined17
herein and in Subsection L, of this Section, all adjusted premiums and present values18
referred to in this Section shall be calculated on the basis of the Commissioner's19
1958 Standard Ordinary Mortality Table and the rate of interest specified in the20
policy for calculating cash surrender values and paid-up nonforfeiture benefits21
provided that such rate of interest shall not exceed four percent per annum for22
policies issued prior to September 7, 1979, and such rate of interest shall not exceed23
five and one-half percent per annum for policies issued on or after September 7,24
1979,. and provided that However, for any category of ordinary insurance issued on25
female risks, adjusted premiums, and present values may be calculated according to26
an age not more than six years younger than the actual age of the insured.; Provided,27
however, that however, in calculating the present value of any paid-up term28
insurance with accompanying pure endowment, if any, offered as a nonforfeiture29
benefit, the rates of mortality assumed may be not more than those shown in the30 ENROLLEDHB NO. 283
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Commissioner's 1958 Extended Term Insurance Table. Provided, further, that1
However, for insurance issued on a substandard basis, the calculation of any such2
adjusted premiums, and present values may be based on such other table of mortality3
as may be specified by the insurer and approved by the commissioner.4
(2) Any After July 27, 1960, any insurer may file with the commissioner a5
written notice of its election to comply with the provisions of this Subsection after6
a specified date with respect to the policies specified in the notice. After the filing7
of such notice, then upon such specified date which shall be the effective date of this8
Subsection for such insurer with respect to such policies, this Subsection shall9
become effective with respect to such policies specified in such notice and thereafter10
issued by such insurer.11
F.(1) This Subsection shall not apply to industrial policies issued on or after12
the effective date of Subsection G of this Section as defined therein. In the case of13
industrial policies issued on or after the effective date of this Subsection F as defined14
herein and in Subsection L of this Section, all adjusted premiums and present values15
referred to in this Section shall be calculated on the basis of the Commissioner's16
1961 Standard Industrial Mortality Table and the rate of interest specified in the17
policy for calculating cash surrender values and paid-up nonforfeiture benefits, but18
such rate of interest shall not exceed four percent per annum for policies issued prior19
to September 7, 1979, and such a rate of interest shall not exceed five and one-half20
percent per annum for policies issued on or after September 7, 1979. In addition, in21
calculating the present value of any paid-up term insurance with accompanying pure22
endowment, if any, offered as a nonforfeiture benefit, the rates of mortality assumed23
may be not more than those shown in the Commissioner's 1961 Industrial Extended24
Term Insurance Table.; Further, however, for insurance issued on a substandard25
basis, the calculations of any such adjusted premiums and present values may be26
based on such other table of mortality as may be specified by the insurer and27
approved by the commissioner.28
* * *29 ENROLLEDHB NO. 283
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G.(1)(a) This Subsection shall apply to all policies issued on or after the1
effective date of this Subsection as defined herein. Except as provided in Paragraph2
(7) of this Subsection, the adjusted premiums for any policy shall be calculated on3
an annual basis and shall be such uniform percentage of the respective premiums4
specified in the policy for each policy year, excluding amounts payable as extra5
premiums to cover impairments or special hazards and also excluding any uniform6
annual contract charge or policy fee specified in the policy in a statement of the7
method to be used in calculating the cash surrender values and paid-up nonforfeiture8
benefits, that the present value, at the date of issue of the policy, of all adjusted9
premiums shall be equal to the sum of the following three factors:10
(a) the (i) The then present value of the future guaranteed benefits provided11
for by the policy;. 12
(b) one (ii) One percent of either the amount of insurance, if the insurance13
be uniform in amount, or the average amount of insurance at the beginning of each14
of the first ten policy years ;. 15
(c) one (iii) One hundred twenty-five percent of the nonforfeiture net level16
premium as hereinafter defined.17
Provided, however, that (b) However, in applying the percentage specified18
in (c) above Item (a)(iii) of this Paragraph, no nonforfeiture net level premium shall19
be deemed to exceed four percent of either the amount of insurance, if the insurance20
be uniform in amount, or the average amount of insurance at the beginning of each21
of the first ten policy years. The date of issue of a policy for the purpose of this22
Subsection shall be the date as of which the rated age of the insured is determined.23
* * *24
(4) Except as otherwise provided in Paragraph 7 (7) of this Subsection, the25
recalculated future adjusted premiums for any such policy shall be such uniform26
percentage of the respective future premiums specified in the policy for each policy27
year, excluding amounts payable as extra premiums to cover impairments and special28
hazards, and also excluding any uniform annual contract charge or policy fee29
specified in the policy in a statement of the method to be used in calculating the cash30 ENROLLEDHB NO. 283
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surrender values and paid-up nonforfeiture benefits, that the present value, at the1
time of change to the newly defined benefits or premiums of all such future adjusted2
premiums shall be equal to the excess of (A) the sum of (a) the then present value of3
the then future guaranteed benefits provided for by the policy and (b) the additional4
expense allowance, if any, over (B) the then cash surrender value, if any, or present5
value of any paid-up nonforfeiture benefit under the policy.6
* * *7
(8) All adjusted premiums and present values referred to in this Section shall8
be calculated for all policies of ordinary insurance on the basis of the9
Commissioner's 1980 Standard Ordinary Mortality Table or at the election of the10
insurer for any one or more specified plans of life insurance, the Commissioner's11
1980 Standard Ordinary Mortality Table with Ten-Year Select Mortality Factors;12
shall be calculated for all policies of industrial insurance on the basis of the13
Commissioner's 1961 Standard Industrial Mortality Table; and shall be calculated14
for all policies issued in a particular calendar year on the basis of a rate of interest15
not exceeding the nonforfeiture interest rate as defined in this Subsection for policies16
issued in that calendar year .; Provided, however, that: however,17
* * *18
(b) Under any paid-up nonforfeiture benefit including any paid-up dividend19
additions, any cash surrender value available, whether or not required by Subsection20
A, of this Section shall be calculated on the basis of the mortality table and rate of21
interest used in determining the amount of such paid-up nonforfeiture benefit and22
paid-up dividend additions, if any.23
* * *24
(d) In calculating the present value of any paid-up term life insurance with25
accompanying pure endowment, if any, offered as a nonforfeiture benefit, the rates26
of mortality assumed may be not more than those shown in the Commissioner's 198027
Extended Term Insurance Table for policies of ordinary insurance and not more than28
the Commissioner's 1961 Industrial Extended Term Insurance Table for policies of29
industrial life insurance.30 ENROLLEDHB NO. 283
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(e) For life insurance issued on a substandard basis, the calculation of any1
such adjusted premiums and present values may be based on appropriate2
modifications of the aforementioned tables.3
(f) Any ordinary life mortality tables, adopted after 1980, by the National4
Association of Insurance Commissioners that are approved by the commissioner for5
use in determining the minimum nonforfeiture standard may be substituted for the6
Commissioner's 1980 Standard Ordinary Mortality Table with or without Ten-Year7
Select Mortality Factors or for the Commissioner's 1980 Extended Term Insurance8
Table.9
(g) Any industrial life mortality tables adopted after 1980, by the National10
Association of Insurance Commissioners that are approved by the commissioner for11
use in determining the minimum nonforfeiture standard may be substituted for the12
Commissioner's 1961 Standard Industrial Mortality Table or the Commissioner's13
1961 Industrial Extended Term Insurance Table.14
* * *15
I.(1) Any cash surrender value and any paid-up nonforfeiture benefit16
available under the policy in the event of default in a premium payment due at any17
time other than on the policy anniversary shall be calculated with allowance for the18
lapse of time and the payment of fractional premiums beyond the last preceding19
policy anniversary. All values referred to in Subsections B, C, D, E, F, and through20
G of this Section may be calculated upon the assumption that any death benefit is21
payable at the end of the policy year of death. The net value of any paid-up22
additions, other than paid-up term additions, shall not be less than the amounts used23
to provide such additions. Notwithstanding the provisions of Subsection B of this24
Section, additional benefits payable in any of the following shall be disregarded in25
ascertaining cash surrender values and nonforfeiture benefits required by this26
Section: 27
(a) In the event of death or dismemberment by accident or accidental means ;.28
(b) In the event of total and permanent disability;. 29
(c) As reversionary annuity or deferred reversionary annuity benefits ;.30 ENROLLEDHB NO. 283
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(d) As term insurance benefits, whether or not provided by a rider or1
supplemental policy provision to which, if issued as a separate policy, this Section2
shall not apply;. 3
(e) As term insurance on the life of a child or on the lives of children4
provided in a policy on the life of a parent of the child, if such term insurance expires5
before the child's age is twenty-six, is uniform in amount after the child's age is one,6
and has not become paid-up by reason of the death of a parent of the child ; and. 7
(f) As other policy benefits additional to life insurance and endowment8
benefits and premiums for all such additional benefits.9
* * *10
J.(1) This Subsection in addition to all other All applicable Subsections of11
this Section shall apply to all policies issued on or after January 1, 1986. Any cash12
surrender value available under the policy in the event of default in a premium13
payment due on any policy anniversary shall be in an amount which does not differ14
by more than two-tenths of one percent of either the amount of insurance, if the15
insurance be uniform in amount, or the average amount of insurance at the beginning16
of each of the first ten policy years, from the sum of: (a) the greater of zero and the17
basic cash value hereinafter specified and (b) the present value of any existing paid-18
up additions less the amount of any indebtedness to the insurer under the policy.19
(2) The basic cash value shall be equal to the present value, on such20
anniversary, of the future guaranteed benefits which would have been provided for21
by the policy, excluding any existing paid-up additions and before deduction of any22
indebtedness to the insurer, if there had been no default, less the then present value23
of the nonforfeiture factors, as hereinafter defined, corresponding to premiums which24
would have fallen due on and after such anniversary.; Provided, however, that25
however, the effects on the basic cash value of supplemental life insurance or annuity26
benefits or of family coverage, as described in Subsection B or Subsection D, of this27
Section, whichever is applicable, shall be the same as are the effects specified in such28 ENROLLEDHB NO. 283
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Subsection B or Subsection D of this Section, whichever is applicable on the cash1
surrender values defined in that Subsection.2
(3)(a) The nonforfeiture factor for each policy year shall be an amount equal3
to a percentage of the adjusted premium for the policy year, as defined in Subsection4
D or Subsection G, of this Section, whichever is applicable. Except as is required5
by the next succeeding sentence Subparagraph (b) of this Paragraph, such percentage6
shall be the same percentage for each policy year between the second policy7
anniversary and the later of the fifth policy anniversary and that of the first policy8
anniversary at which there is available under the policy a cash surrender value in an9
amount, before including any paid-up additions and before deducting any10
indebtedness, of at least two tenths of one percent of either the amount of insurance,11
if the insurance be uniform in amount, or the average amount of insurance at the12
beginning of each of the first ten policy years.13
(b) No percentage after the later of the two policy anniversaries specified in14
the preceding sentence Subparagraph (a) of this Paragraph shall apply to fewer than15
five consecutive policy years.; Provided, that however, no basic cash value may be16
less than the value which would be obtained if the adjusted premiums for the policy,17
as defined in Subsections Subsection D or G, of this Section, whichever is18
applicable, were substituted for the nonforfeiture factors in the calculation of the19
basic cash value.20
* * *21
(5) Any cash surrender value available other than in the event of default in22
a premium payment due on a policy anniversary, and the amount of any paid-up23
nonforfeiture benefit available under the policy in the event of default in a premium24
payment shall be determined in manners consistent with the manners specified for25
determining the analogous minimum amounts in Subsections A, B, C, G, and I of26
this Section. The amounts of any cash surrender values and of any paid-up27
nonforfeiture benefits granted in connection with additional benefits such as those28 ENROLLEDHB NO. 283
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listed as items Subparagraphs (a) through (f) in Subsection I (I)(1)(a) through (f) of1
this Section shall conform with the principles of this Subsection.2
* * *3
K.(1) This Section shall not apply to any of the following: 4
* * *5
(g) Policy, which provides no guaranteed nonforfeiture or endowment6
benefits, for which no cash surrender value, if any, or present value of any paid-up7
nonforfeiture benefit, at the beginning of any policy year, calculated as specified in8
Subsections B, C, D, E, F, and through G of this Section, exceeds two and one-half9
percent of the amount of insurance at the beginning of the same policy year.10
(h) Policy which shall be delivered outside this state through an agent a11
producer or other representative of the insurer issuing the policy.12
* * *13
§941. Group life insurance defined; eligibility; payment of premiums; limits and14
coverage15
* * *16
B. Each policy of group life insurance may cover one or more employees or17
members at date of issue.as follows:18
* * *19
(6) Any policy issued under this section Section may provide for the20
readjustment of the rate of premium based on the experience thereunder at the end21
of the first year or of any subsequent year of insurance thereunder and such22
readjustment may be made retroactive only for such policy year. Any refund on any23
plan for readjustment of the rate of premium based on the experience of the group24
policies hereafter issued, and any dividend paid under such policies may be used to25
reduce the employer's share of the cost of coverage, except that if the aggregate26
refunds or dividends under such group policy and in any other group policy or27
contract issued to the policyholder exceed the aggregate contributions of the28 ENROLLEDHB NO. 283
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employer toward the cost of the coverages, such excess shall be applied by the1
policyholder for the sole benefit of insured employees.2
* * *3
§942. Standard provisions for group life policies4
Each policy of group life insurance as defined in R.S. 22:941 shall contain5
in substance the following provisions or, at the option of the insurer, provisions6
which in the opinion of the commissioner of insurance are not less favorable to the7
policyholder .; However, Paragraphs (6) through (12) of this Section shall not apply8
to policies described in Paragraph (3) of Subsection A of R.S. 22:941 R.S.9
22:941(A)(3), except that, where policies are issued pursuant to said that Paragraph,10
the insurer shall issue to the policyholder for delivery to the person whose life is11
insured an individual certificate setting forth the insurance protection afforded, to12
whom it is payable, information relating to notice and proof of loss, and that the13
standard provisions required for individual life insurance policies shall not apply to14
group life insurance policies.:15
(1) The contract: A provision that a copy of the application, if any, of the16
policyholder shall be attached to the policy when issued, that all statements made by17
the policyholder or by the persons insured shall be deemed representations and not18
warranties, and that no statement made by any person insured shall be used in any19
contest unless a copy of the instrument containing the statement is or has been20
furnished provided to such person or to his beneficiary.21
* * *22
(10) Conversion on termination of eligibility: A provision that if the23
insurance, or any portion of it, on an individual covered under the policy ceases24
because of termination of employment or of membership in the class or classes25
eligible for coverage under the policy, such individual shall be entitled to have issued26
to him by the insurer, without evidence of insurability, an individual policy of life27
insurance without disability or other supplementary benefits, provided application28 ENROLLEDHB NO. 283
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for the individual policy shall be made and the first premium paid to the insurer1
within thirty-one days after such termination. It is further provided that:2
* * *3
(b) The individual policy shall be in an amount not in any event in excess of4
the amount of life insurance which ceases because of such termination nor less than5
one thousand dollars unless a smaller amount of coverage was provided for such6
individual under the group policy, provided that any amount of insurance which7
matures on the date of such termination or has matured prior thereto under the group8
policy as an endowment payable to the individual insured, whether in one sum or9
installments or in the form of an annuity, shall not, for the purposes of this provision,10
be included in the amount which is considered to cease because of such termination.11
* * *12
(11) Conversion on termination of policy: A provision that if the group13
policy terminates or is amended so as to terminate the insurance of any class of14
insured individuals, every individual insured thereunder at the date of such15
termination whose insurance terminates and who has been so insured for at least five16
years prior to such termination date shall be entitled to have issued to him by the17
insurer an individual policy of life insurance, subject to the same conditions and18
limitations as are provided by Paragraph (10) of this Section, except that the group19
policy may provide that the amount of such individual policy shall not exceed the20
smaller of (a) the amount of the individual's life insurance protection ceasing because21
of the termination or amendment of the group policy, less the amount of life22
insurance for which he is or becomes eligible under any group policy issued or23
reinstated by the same or another insurer within thirty-one days of such termination24
and (b) two thousand dollars.25
* * *26 ENROLLEDHB NO. 283
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§943. Group life insurance; exclusions; restrictions; contestability1
* * *2
D. In the event of death as to which there is an exclusion or restriction not3
prohibited by Paragraph (A)(2) of this Section or is allowed by the commissioner,4
the insurer shall pay the greater of:5
* * *6
(2) The amount of the gross premiums charged on the policy less dividends7
paid in cash or used in the payment of premiums thereon and less any indebtedness8
to the insurer on the policy, including interest due or accrued.9
* * *10
§944. Exemption of proceeds; group life 11
A. A policy of group life insurance or the proceeds thereof payable to the12
individual insured or to the beneficiary, thereunder, shall not be liable, either before13
or after payment, to be applied to any legal or equitable process to pay any liability14
of any person having a right under the policy. The proceeds, thereof, when not made15
payable to a named beneficiary or to a third person pursuant to a facility-of-payment16
clause, shall not constitute a part of the estate of the individual insured for the17
payment of his debts.18
* * *19
§951. Annuities and pure endowment contracts; standard provisions20
A. No annuity or pure endowment contract except a reversionary annuity21
otherwise called a survivorship annuity and except a group annuity contract shall be22
delivered or issued for delivery in this state unless it contains in substance the23
following provision or provisions which in the opinion of the commissioner of24
insurance are more favorable to the holders of such contracts:25
(1) Grace period: A provision that there shall be a period of grace, either of26
thirty days or of one month, within which any stipulated payment to the insurer27
falling due after the first may be made, during which period of grace the contract28
shall continue in full force; but if a claim arises under the contract on account of29
death during the said period of grace before the overdue payment to the insurer or30 ENROLLEDHB NO. 283
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the deferred payments of the current contract year, if any, are made, the amount of1
such payments, with interest, not in excess of six per cent percent per annum, on any2
overdue payments, may be deducted from any amount payable under the contract in3
settlement.4
(2) Incontestability: If any statements, other than those relating to age, sex,5
and identity, are required as a condition of issuing the contract, a provision that the6
contract shall be incontestable after it has been in force during the lifetime of the7
person or each of the persons as to whom such statements are required, for a period8
of two years from its date of issue, except where stipulated payments to the insurer9
have not been made, and except for violation of the conditions, if any, of the contract10
relating to military or naval service; and at the option of the insurer issuing the same,11
such contract may also except provisions relative to benefits in the event of total and12
permanent disability and provisions which grant insurance specifically against death13
by accident or accidental means.14
(3) Entire contract: A provision that the contract shall constitute the entire15
contract between the parties, or if a copy of the application is endorsed upon or16
attached to the contract when issued, a provision that the contract and the application17
therefor shall constitute the entire contract between the parties.18
(4) Misstatement of age or sex: A provision that if the age or sex of the19
person or persons upon whose life or lives the contract is made, or of any of them,20
has been misstated, the amount payable or benefit accruing under the contract, shall21
be such as the stipulated payments to the insurer would have purchased according22
to the correct age or sex; and that if the insurer shall make any overpayments on23
account of any such misstatement, the amount thereof, with interest at a rate to be24
specified in the contract but not exceeding six per centum percent per annum, shall25
be charged against the current or next succeeding payment or payments to be made26
by the insurer under the contract.27
(5) A Participating policy: If the policy is a participating policy, a provision28
that the insurer shall annually ascertain and apportion any divisible surplus accruing29
on the contract.30 ENROLLEDHB NO. 283
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(6) Nonforfeiture options: A provision specifying the options available in1
the event of default in a stipulated payment after three full years stipulated payments2
have been made, together with a table showing, in figures, the options so available3
during each of the first twenty years after the issuance of the contract or for the term4
of the stipulated payments, if that be less than twenty years.5
(7) Reinstatement: A provision that at any time within one year from the6
date of default in making stipulated payments to the insurer, during the life of the7
annuitant and unless the cash surrender value, if any, has been paid, the contract will8
be reinstated, on the application of the person entitled thereto pursuant to the9
provisions of the contract, upon payment to the insurer of all overdue stipulated10
payments and of all indebtedness to the insurer on the contract with interest on both11
at a rate to be specified in the contract but not to exceed six per cent percent per12
annum, compounded annually; and in cases where applicable the contract may also13
contain a provision requiring, as a condition of reinstatement, evidence of14
insurability, including good health, satisfactory to the insurer.15
(8)(a) Free look period: A provision, prominently printed on the contract or16
attached thereto, notifying the insured that ten days are allowed, from the date of17
actual receipt of the contract, to examine its provisions. If the contract is not as18
explained by the company, its representative, or as understood by the insured, the19
contract may be surrendered within said ten-day period, and any premium advanced20
by the insured, upon the surrender, shall be immediately returned to him. The21
insurer shall have the option of printing, attaching, or endorsing the notice above22
required or a notice of equal prominence which, in the opinion of the commissioner23
of insurance, is not less favorable to the contract holder.24
(b) If the policy is delivered by an agent or broker, a producer, a receipt shall25
be signed by the policyholde r acknowledging delivery of the policy. The receipt26
shall contain the policy number and the date the delivery was completed. The27
delivery receipts required by this Subparagraph shall be retained by the insurer , its28
agent, or the broker or its producer for two consecutive years. The requirement of29
this Subparagraph shall not apply to any insurer that markets policies under a home30 ENROLLEDHB NO. 283
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service marketing distribution method and that issues a majority of its policies on a1
weekly or monthly basis.2
(c) If the policy is delivered by mail, it shall be sent by certified mail, return3
receipt requested, or a certificate of mailing shall be obtained showing the date the4
policy was mailed to the policyowner. For policy issuances verified by a certificate5
of mailing, it is presumed that the policy is received by the policyowner ten days6
from the date of mailing. The receipts and the certificate of mailing described in this7
Section Subparagraph shall be retained by the insurer or agent producer for three two8
years.9
* * *10
§952. Standard nonforfeiture law for individual deferred annuities11
A.12
* * *13
(2) This Section shall not apply to any charitable gift annuity entered into on14
behalf of an organization qualified with the United States Internal Revenue Service15
for an exemption from federal income tax under Section 501(c)(3) of the Internal16
Revenue Code, reinsurance, group annuity purchases under a retirement plan or plan17
of deferred compensation established or maintained by an employer , (including a18
partnership or sole proprietorship), or by an employee organization, or by both, other19
than a plan providing individual retirement accounts or individual retirement20
annuities under Section 408 of the Internal Revenue Code, as now or hereafter21
amended, premium deposit fund, variable annuity, investment annuity, immediate22
annuity, any deferred annuity contract after annuity payments have commenced, or23
reversionary annuity, nor to any contract which shall be delivered outside this state24
through an agent a producer or other representative of the company issuing the25
contract.26
* * *27
B. In the case of contracts issued on or after the operative date of this Section28
as defined in Subsection K, of this Section, no contract of annuity, except as stated29
in Subsection A, of this Section, shall be delivered or issued for delivery in this state30 ENROLLEDHB NO. 283
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unless it contains in substance the following provisions, or corresponding provisions1
which in the opinion of the commissioner are at least as favorable to the contract-2
holder, upon cessation of payment of considerations under the contract .:3
* * *4
(4)(a) A statement that any paid-up annuity, cash surrender or death benefits5
that may be available under the contract are not less than the minimum benefits6
required by any statute of the state in which the contract is delivered and an7
explanation of the manner in which such benefits are altered by the existence of any8
additional amounts credited by the company to the contract, any indebtedness to the9
company on the contract, or any prior withdrawals from or partial surrenders of the10
contract.11
(b) Notwithstanding the requirements of this Subsection, any deferred12
annuity contract may provide that if no considerations have been received under a13
contract for a period of two full years and the portion of the paid-up annuity benefit14
at maturity on the plan stipulated in the contract arising from considerations paid15
prior to such period would be less than twenty dollars monthly, the company may at16
its option terminate such contract by payment in cash of the then present value of17
such portion of the paid-up annuity benefit, calculated on the basis of the mortality18
table, if any, and interest rate specified in the contract for determining the paid-up19
annuity benefit, and by such payment shall be relieved of any further obligation20
under such contract.21
* * *22
J. For any contract which provides, within the same contract by rider or23
supplemental contract provision, both annuity benefits and life insurance benefits24
that are in excess of the greater of cash surrender benefits or a return of the gross25
considerations with interest, the minimum nonforfeiture benefits shall be equal to the26
sum of the minimum nonforfeiture benefits for the annuity portion and the minimum27
nonforfeiture benefits, if any, for the life insurance portion computed as if each28
portion were a separate contract. Notwithstanding the provisions of Subsections D,29
E, F, G, and H, additional benefits payable: (i) in the event of total and permanent30 ENROLLEDHB NO. 283
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disability,; (ii) as reversionary annuity or deferred reversionary annuity benefits,; or1
(iii) as other policy benefits additional to life insurance, endowment and annuity2
benefits, and considerations for all such additional benefits, shall be disregarded in3
ascertaining the minimum nonforfeiture amounts, paid-up annuity, cash surrender,4
and death benefits that may be required by this Section. The inclusion of such5
additional benefits shall not be required in any paid-up benefits, unless such6
additional benefits separately would require minimum nonforfeiture amounts, paid-7
up annuity, cash surrender, and death benefits.8
* * *9
§961. Group annuity contracts; definition; standard provisions 10
A. Any policy or contract, except a joint, reversionary or survivorship11
annuity contract, whereby annuities are payable dependent upon the continuation of12
the lives of more than one person, shall be deemed a group annuity contract. The13
person, firm, or corporation to whom such contract is issued shall be deemed the14
"holder" of such contract. The term "annuitant," as used herein, refers to any person15
upon whose continued life such annuity is dependent.16
B. No group annuity contract shall be delivered or issued for delivery in this17
state and no certificate shall be used in connection therewith unless it contains in18
substance the following provisions to the extent that such provisions are applicable19
to such contract or to such certificate, as the case may be, or provisions which in the20
opinion of the commissioner of insurance are more favorable to annuitants, or not21
less favorable to annuitants and more favorable to the holders: 22
(1) Grace period: A provision in such contract that there shall be a period23
of grace, either of thirty days or of one month, within which any stipulated payment24
to be remitted by the holder to the insurer, falling due after one year from date of25
issue, may be made, subject, at the option of the insurer, to an interest charge thereon26
at a rate, to be specified in the contract, which shall not exceed six per cent percent27
per annum for the number of days of grace elapsing before such payment.28
(2) Entire contract: A provision in such contract specifying the document29
or documents which shall constitute the entire contract between the parties; the30 ENROLLEDHB NO. 283
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document or documents so specified shall be only: (a) the contract,; (b) the contract1
together with the application of the holder of which a copy is attached thereto,; or (c)2
the contract together with the application of the holder of which a copy is attached3
thereto and the individual applications of annuitants on file with the insurer and4
referred to therein.5
(3) Misstatement of age or sex: A provision in such contract, with an6
appropriate reference thereto in the certificate, for the equitable adjustment of the7
benefits payable under the contract or of the stipulated payments thereunder, if it8
befound that the sex, age, service, salary, or any other fact determining the amount9
of any stipulated payment or the amount or date or dates of payment of any benefit10
with respect to any annuitant covered thereby, has been misstated.11
(4) Ascertainment of the benefit: A provision or provisions in such contract,12
with an appropriate reference thereto in the certificate, specifying the nature and13
basis of ascertainment of the benefits which will be available to an annuitant who14
contributes to the cost of the annuity and the conditions of payment thereof in the15
event of either the termination of employment of the annuitant, except by death, or16
the discontinuance of stipulated payments under the contract. Such provision or17
provisions shall, in either of such events, make available to an annuitant who18
contributes to the cost of the annuity a paid-up annuity payable commencing at a19
fixed date in an amount at least equal to that purchased by the contributions of the20
annuitant, determinable as of the respective dates of payment of the several21
contributions, as shown by a schedule included in the contract for that purpose, based22
upon the same mortality table, rate of interest, and loading formula used in23
computing the stipulated payments under such contract. Such provision or24
provisions may, by way of exception to the foregoing, provide that if the amount of25
the annuity determined as aforesaid from such fixed commencement date would be26
less than sixty dollars annually, the insurer may at its option, in lieu of granting such27
paid-up annuity, pay a cash surrender value at least equal to that hereinafter28
provided. If a cash surrender value, in lieu of such paid-up annuity, is allowed to the29
annuitant by the terms of such contract, it may be either in a single sum or in equal30 ENROLLEDHB NO. 283
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installments over a period of not more than twelve months and it shall be at least1
equal to either (a) or (b), whichever is less: (a) the amount of reserve attributable to2
the annuitant's contributions less a surrender charge not exceeding thirty-five per3
centum of the average annual contribution made by the annuitant; or (b) the amount4
which would be payable as a death benefit at the date of surrender. Such contract5
shall also provide that in case of the death of the annuitant, before the6
commencement date of the annuity, the insurer shall pay a death benefit at least7
equal to the aggregate amount of the annuitant's contributions, without interest. If8
any benefits are available to the holder in either of such events the contract shall9
contain a provision or provisions specifying the nature and basis of ascertainment of10
such benefits.11
(5) Certificates: A provision in such contract that the insurer will issue to12
the holder of the contract for delivery to each annuitant who contributes thereunder13
an individual certificate setting forth a statement in substance of the benefits to14
which he is entitled under such contract.15
* * *16
§1541. Purpose and scope17
This Subpart shall govern the qualifications and procedures for the licensing18
of insurance producers. These provisions shall apply to any and all lines of19
insurance and types of insurers, including but not limited to life, health, property,20
liability, credit, title, fire, or marine, operating on a stock, mutual reciprocal, fraternal21
benefit, hospital, or medical service plan, as set forth in this Subpart.22
§1542. Definitions23
As used in this Subpart, unless the context requires otherwise, the following24
definitions shall be applicable:25
(1) "Authorized insurer" shall mean any type of insurer other than surplus26
lines or unauthorized insurer. have the same definition as set forth in R.S. 22:46.27
* * *28
(4) "Home state" shall mean the District of Columbia or any state or territory29
of the United States in which an insurance producer maintains his or her a principal30 ENROLLEDHB NO. 283
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place of residence or principal place of business and is licensed to act as an insurance1
producer.2
* * *3
(6) "Insurance producer" or "producer" shall mean a person required to be4
licensed under the laws of this state to sell, solicit, or negotiate insurance, and5
includes all persons or business entities otherwise referred to in the Louisiana6
Insurance this Code as "insurance agent" or "agent", or "insurance broker" or7
"broker", or "insurance solicitor" or "solicitor", or "surplus lines broker".8
* * *9
(9) "Limited line credit insurance" includes credit life, as defined in R.S.10
22:47(16) and R.S. 6:969.6(12), credit disability, credit property, credit11
unemployment, involuntary unemployment, mortgage life, mortgage guaranty, or12
mortgage disability insurance, and any other form of insurance offered in connection13
with an extension of credit that is limited to partially or wholly extinguishing that14
credit obligation that the commissioner of insurance determines should be designated15
a form of limited line credit insurance.16
* * *17
(11) "Limited lines insurance" is any authority granted by the commissioner18
of insurance which restricts the authority of the licensee to less than the total19
authority prescribed in the associated major lines pursuant to R.S. 22:1547(A)(1)20
through (5) (6).21
* * *22
(14) "Negotiate" shall mean to confer directly with or to offer advice directly23
to a purchaser, certificate holder, or enrollee, or prospective purchaser, certificate24
holder, or enrollee, of a particular contract of insurance, including certificates, riders,25
endorsements, or amendments, concerning any of the benefits, terms, or conditions26
of the contract, provided that if the person engaged in that act is an insurance27
producer who either sells insurance or obtains insurance from insurers for28
purchasers, certificate holders, or enrollees.29
* * *30 ENROLLEDHB NO. 283
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(18) "Surplus lines broker" shall mean an insurance producer who solicits,1
negotiates, or procures a property and casualty policy with an insurance company not2
licensed to transact business in the state which cannot be procured from insurers3
licensed to do business in this state. All transactions entered into under such license4
shall be subject to R.S. 22:1902 431 et seq.5
* * *6
§1544. Exceptions to licensing; prohibitions7
* * *8
B. A license as an insurance producer shall not be required of the following:9
* * *10
(5) A person whose activities in this state are limited to advertising without11
the intent to solicit insurance in this state through communications in printed12
publications or other forms of electronic mass media whose distribution is not13
limited to residents of this state, provided that if the person does not sell, solicit, or14
negotiate insurance that would insure risks residing, located, or to be performed in15
this state.16
(6) A person who is not a resident of this state who sells, solicits, or17
negotiates a contract of insurance for commercial property and casualty risks to an18
insured with risks located in more than one state insured under that contract,19
provided if that person is otherwise licensed as an insurance producer to sell, solicit,20
or negotiate that insurance in the state where the insured maintains its principal place21
of business and the contract of insurance insures risks located in that state.22
(7) A salaried full-time employee who counsels or advises his or her23
employer relative to the insurance interests of the employer or of the subsidiaries or24
business affiliates of the employer provided that if the employee does not sell or25
solicit insurance or receive a commission.26
(8) Employees of an insurer or of an insurance producer who respond to27
requests from existing policyholders, on existing policies, provided that if those28
employees are not directly compensated based on the volume of premiums that may29 ENROLLEDHB NO. 283
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result from these services and provided if those employees do not sell, solicit, or1
negotiate insurance.2
* * *3
D. No person shall be licensed as an insurance producer, limited lines4
producer, surplus lines broker, or managing general agent in this state if they, he or5
any person who owns directly or indirectly more than ten percent of the beneficial6
interest in a business entity applying for a license, are is either a citizen of, resident7
of, domiciled in, or the commissioner determines that they he or the beneficial owner8
maintain maintains significant assets in, a country that the commissioner determines9
does not give full faith and credit to any judgment rendered by a court of this state10
or of the United States, or that the country does not have laws similar to those of this11
state for the discovery of assets of the insurer, seizure or sale of such assets, and12
execution of a judgment thereof.13
§1545. Examination14
* * *15
I.(1) The commissioner of insurance shall prepare, publicly announce, and16
publish a report that summarizes statistical information relating to life insurance17
agent producer examinations administered during the preceding calendar year. Each18
report shall include the following information for all examinees combined and19
separately by gender, race or ethnicity, race or ethnicity within gender, education20
level, and native language:21
* * *22
§1546. Application for license23
A. A person applying for a resident insurance producer license shall make24
application to the commissioner of insurance on the Uniform Application and declare25
under penalty of refusal, suspension, or revocation of the license that the statements26
made in the application are true, correct, and complete to the best of the individual's27
knowledge and belief. Before approving the application, the commissioner shall find28
that the individual:29
* * *30 ENROLLEDHB NO. 283
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(3) Is not disqualified for having committed any act that is a ground for1
denial, suspension, or revocation as set forth in R.S. 22:1554.2
* * *3
D.4
* * *5
(4) The commissioner of insurance shall treat and maintain an applicant's6
fingerprints and any criminal history record information obtained under this Section7
as confidential and shall apply security measures consistent with the Criminal Justice8
Information Services Division of the Federal Bureau of Investigation standards for9
the electronic storage of fingerprints and necessary identifying information and limit10
the use of records solely to the purposes authorized in this Section. The fingerprints11
and any criminal history record information shall be exempt from the public records12
law, (R.S. 44:1 et seq.,) shall not be subject to subpoena, other than a subpoena13
issued in a criminal proceeding or investigation, and shall be confidential by law and14
privileged, and shall not be subject to discovery or admissible in evidence in any15
private civil action.16
* * *17
F. Any license issued pursuant to an application claiming residency, for18
licensing purposes, as defined herein, in R.S. 22:46, shall constitute an election of19
residency in the state, and shall be void if the licensee while maintaining a resident20
license also maintains a license in, or thereafter submits an application for a license21
in, any other state or other jurisdiction stating that the applicant is a resident of such22
other state or jurisdiction, or if the licensee ceases to be a resident of this state.23
§1547. License24
A. Unless denied licensure pursuant to R.S. 22:1554, persons who have met25
the requirements of this Subpart shall be issued an insurance producer license. An26
insurance producer may receive qualification for a license in one or more of the27
following lines of authority:28
* * *29 ENROLLEDHB NO. 283
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(10) Limited life, health and accident, which provides insurance coverage1
pursuant to R.S. 22:142. A license for limited life may allow the producer to sell life2
insurance in an amount not to exceed thirty thousand dollars when appointed by an3
insurer which meets the minimum financial requirements of, and is licensed pursuant4
to, R.S. 22:82(A)(1) or 112(A)(1), and when such policies are issued by said such5
insurer.6
* * *7
C.8
* * *9
(2) Any licensee who fails to file timely for license renewal shall be charged10
a late fee of twenty-five dollars, or other such amount as may be authorized by R.S.11
22:821, for each license not renewed timely.12
* * *13
D. An insurance producer who allows his or her license to lapse may, within14
five years from the expiration date of the license, reinstate the same license upon15
proof of fulfilling all continuing education requirements through the date of16
reinstatement and upon payment of all fees due. If the license has been lapsed for17
more than five years, the applicant shall fulfill the requirements for issuance of a new18
license.19
E. A licensed insurance producer who is unable to comply with license20
renewal procedures due to military service or some other extenuating circumstance,21
such as a long-term medical disability, may request a waiver of those procedures.22
The producer may also request a waiver of any examination requirement or any other23
fine or sanction imposed for failure to comply with renewal procedures.24
* * *25
G. Every licensee shall notify the commissioner, by any means acceptable26
to the commissioner, of any alteration in his residential, mailing, or business address27
within ten days of the alteration. Failure to file an address change within the28
required time shall result in the imposition of a fifty-dollar penalty per violation, or29
as may be authorized by R.S. 22:821. Any person against whom a penalty has been30 ENROLLEDHB NO. 283
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levied shall be given due notice of such action. Upon receipt of this notice, the1
licensee may apply for and shall be entitled to a hearing in accordance with Chapter2
12 of this Title, R.S. 22:2191 et seq.3
H. A duplicate license may be issued for any lost, stolen, or destroyed4
license issued pursuant to this Subpart upon a request by the licensee, by a method5
prescribed by the commissioner, setting forth the facts of such loss, theft, or6
destruction, together with a fee of five dollars, or such amount as may be authorized7
by R.S. 22:821.8
I. Any licensed property and casualty insurance producer maintaining an9
office at a designated location in this state and having at least two years experience10
in the insurance business with an insurer or as an insurance producer may be licensed11
as a surplus lines broker as follows:12
* * *13
(3) Passage of The applicant shall pass an examination approved by the14
commissioner of insurance.15
* * *16
§1548. Nonresident licensing17
A. Unless denied licensure pursuant to R.S. 22:1554, a nonresident person18
shall receive a nonresident producer license if:19
(1) The person is currently licensed as a resident and in good standing in his20
or her home state.21
* * *22
(3) The person has submitted or transmitted to the commissioner of23
insurance the application for licensure that the person submitted to his or her home24
state, or in lieu of the same, a completed Uniform Application.25
* * *26
B.27
* * *28
(2) Whenever, by the laws or regulations of any other state or jurisdiction,29
any limitation of rights and privileges, conditions precedent, or any other30 ENROLLEDHB NO. 283
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requirements are imposed upon residents of this state who are nonresident applicants1
or licensees of such other state or jurisdiction in addition to, or in excess of, those2
imposed on nonresidents under this Subpart, the same such requirements shall be3
imposed upon such residents of such other state or jurisdiction.4
(3)5
* * *6
(b) The service of process upon any such licensee in any action or7
proceeding in any court of competent jurisdiction may be made by a party serving8
the commissioner of insurance with appropriate copies thereof and the payment to9
him of a the fee of twenty-five dollars, or as may be authorized by R.S. 22:821.10
* * *11
D.12
* * *13
(2) Except as provided by Subsection A of this Section, nothing in this14
Section otherwise amends or supersedes any provision of R.S. 22:1902 431 et seq.15
E. Notwithstanding any other provision of this Subpart, a person licensed as16
a limited line credit insurance or other type of limited lines producer in his home17
state shall receive a nonresident limited lines producer license, pursuant to18
Subsection A of this Section, granting the same scope of authority as granted under19
the license issued by the producer's home state. For the purposes of this Subsection,20
limited line insurance is any authority granted by the home state which restricts the21
authority of the licensee to less than the total authority prescribed in the associated22
major lines pursuant to R.S. 22:1547(A)(1) through (5)(6).23
§1549. Specialty limited lines credit insurance24
* * *25
B. For a specialty limited lines credit insurance producer license to be issued26
pursuant to this Section, an applicant must submit to the commissioner all of the27
following:28
* * *29 ENROLLEDHB NO. 283
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(4) An application fee in the amount of one thousand dollars, or for an1
applicant registering twenty or fewer employees or representatives, an application2
fee in the amount of two hundred fifty dollars, or such other amount as may be3
authorized by as set forth in R.S. 22:821.4
(5) Upon approval of the application, but prior to issuance of the license, the5
applicant shall submit a registration fee of twenty dollars per employee or6
representative to be registered by the licensee; however, the registration fee shall not7
exceed two thousand five hundred dollars annually for each licensee. as set forth in8
R.S. 22:821.9
C. Following initial issuance of the specialty limited lines credit insurance10
producer license, the licensee shall submit an annual renewal application, in a11
manner prescribed by the commissioner, along with an annual renewal fee of five12
hundred dollars, or for a licensee registering twenty or fewer employees or13
representatives, an annual renewal fee of one hundred twenty-five dollars, and an14
annual renewal registration fee of ten dollars per employee or representative of the15
licensee, or such other amounts as may be authorized by the fee as set forth in R.S.16
22:821.17
D. The licensee shall submit, in a manner prescribed by the commissioner,18
a current list of employees and representatives for verification by the commissioner19
every six months, in addition to an initial the registration fee of twenty dollars per20
required by R.S. 22:821 for every employee or representative not previously21
registered.22
E. A specialty limited lines credit insurance producer license issued pursuant23
to this Section authorizes an employee or representative of the license holder to24
participate in enrollment of retail sales and credit customers in the types of insurance25
specified in this Section without being licensed, provided if all of the following is26
are true:27
* * *28
F. A specialty limited lines credit insurance producer may not in any manner29
advertise, represent, or otherwise hold out any employee or representative of the30 ENROLLEDHB NO. 283
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license holder as a licensed insurance agent producer pursuant to another provision1
of this Subpart, unless the entity or individual actually holds the applicable license.2
* * *3
H. The specialty limited lines credit insurance producer license shall be4
available equally to residents and nonresidents, provided that; however, if the laws5
or regulations of any other state would not permit a specialty limited lines credit6
insurance producer that is a resident of this state to obtain a substantially equivalent7
nonresident license, then residents of that state shall not be permitted to obtain a8
specialty limited lines credit insurance producer license as nonresidents under this9
Section.10
* * *11
§1550. Specialty limited lines motor vehicle title insurance producer licenses12
A.13
* * *14
(2) No producer shall sell, solicit, or negotiate motor vehicle title insurance15
pursuant to a specialty limited lines motor vehicle title insurance producer license16
other than in connection with retail sales of motor vehicles wherein in which the17
transaction exceeds one thousand dollars and as provided in rules and regulations18
adopted by the commissioner of insurance.19
* * *20
B.(1) For a specialty limited lines motor vehicle title insurance producer21
license to be issued pursuant to this Section, an applicant must shall submit to the22
commissioner of insurance all of the following:23
* * *24
(d) An application fee in the amount of one thousand dollars, or for an25
applicant registering twenty or fewer employees or representatives, an application26
fee in the amount of two hundred fifty dollars, or such other amount as may be27
authorized by set forth in R.S. 22:821.28
(2) Upon approval of the application, but prior to issuance of the license, the29
applicant shall also submit a registration fee of twenty dollars per employee or30 ENROLLEDHB NO. 283
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representative to be registered by the licensee; however, the registration fee shall not1
exceed two thousand five hundred dollars annually for each licensee. in the amount2
set forth in R.S. 22:821.3
C. Following initial issuance of the specialty limited lines motor vehicle title4
insurance producer license, the licensee shall submit an annual renewal application,5
in a manner prescribed by the commissioner of insurance, along with an annual6
renewal fee of five hundred dollars, or for a licensee registering twenty or fewer7
employees or representatives, an annual renewal fee of one hundred twenty-five8
dollars, and an annual renewal registration fee of ten dollars per employee or9
representative of the licensee, or such other amounts as may be authorized by as set10
forth in R.S. 22:821.11
D. The licensee shall submit, in a manner prescribed by the commissioner12
of insurance, a current list of employees and representatives for verification by the13
commissioner every six months in addition to an initial a registration fee of twenty14
dollars per as required by R.S. 22:821 for every employee or representative not15
previously registered.16
E. A specialty limited lines motor vehicle title insurance producer license17
issued pursuant to this Section authorizes an employee or representative of the18
license holder to participate in enrollment of retail motor vehicle sales customers in19
the types of insurance specified in this Section without being licensed, provided if20
all of the following is are true:21
* * *22
H. The specialty limited lines motor vehicle title insurance producer license23
shall be available equally to residents and nonresidents, provided that; however, if24
the laws or regulations of any other state would not permit a specialty limited lines25
motor vehicle title insurance producer that is a resident of this state to obtain a26
substantially equivalent nonresident license, then residents of that state shall not be27
permitted to obtain a specialty limited lines motor vehicle title insurance producer28
license as nonresidents under this Section.29
* * *30 ENROLLEDHB NO. 283
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§1554. License denial, nonrenewal, or revocation1
* * *2
G. Upon suspension, revocation, or termination of the license of a resident3
of this state, the commissioner shall notify the support and services office of the4
National Association of Insurance Commissioners and the proper insurance official5
of each state for whom the commissioner has executed a certificate as provided for6
herein.7
* * *8
§1555. Liability of agents producers on binder 9
The commissioner of insurance may suspend or revoke the license of any10
agent producer issuing or purporting to issue any binder as to on behalf of any11
insurer named therein as to for which he is not then authorized so to bind.12
§1556. License to solicit or transact bail; prohibited activities13
A. A bail licensee bond producer shall not directly or indirectly permit any14
person, including an employee, to sign or execute a power of attorney or to effect the15
undertaking of bail for the release of a defendant or to apprehend or surrender a16
defendant on his behalf unless the person is properly licensed by the commissioner17
to perform such acts. This Section shall not prevent a bail bond producer from using18
mail, messenger or delivery service to file executed undertakings of bail or deliver19
bail bonds, nor shall it prevent such filing or delivery by the attorney or other agent20
of the defendant.21
B. A bail licensee bond producer shall not directly or indirectly give a gift22
of any kind to a prisoner of a jail or place of detention or to a public official or23
employee of a governmental agency whose duties, functions, or responsibilities24
include the administration of justice.25
C. Upon first violation, a person or entity that violates Subsection A of this26
Section shall be subjected to a six-month suspension of their license to write or27
solicit bail bonds and fined an amount not to exceed five thousand dollars. A second28
or any subsequent violation shall subject the person or entity to a suspension of their29
license to write or solicit bail bonds for not more than one year and a fine not to30 ENROLLEDHB NO. 283
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exceed ten thousand dollars. A hearing may be requested pursuant to the provisions1
of Chapter 12 of this Title, subject to the provisions of Chapter 13-B of Title 49 of2
the Louisiana Revised Statutes of 1950.3
* * *4
§1557. Commissions5
* * *6
B.(1) No member of an insurance advisory committee of any state agency,7
board, commission, or of any political subdivision of this state, including but not8
limited to school boards, levee boards, deep water port commissions, deep water9
port, harbor and terminal districts, and the Louisiana Stadium and Exposition10
District, shall split, pass on, or share with any insurance producer or other person11
who is not a member of his own firm or corporation and is not a member of said such12
an insurance advisory committee, all or any portion of the commission derived by13
such committee from the purchase of insurance by such state agency, board,14
commission, or political subdivision of the state without express authorization by15
official action of such state agency, board, commission, or political subdivision of16
the state. Any insurance producer or other person who is not a member of such firm17
or corporation and is not a member of said such an insurance advisory committee18
who receives without authorization all or any portion of such commission shall also19
be in violation of this Subsection.20
(2) Any violator of person who violates the provisions of this Subsection21
shall, upon conviction, be fined not less than one thousand dollars, nor more than22
five thousand dollars per violation, or imprisoned for not more than two years, or23
both.24
C. The commission paid by each fire, casualty, surety, fidelity, guaranty, and25
bonding insurer doing business in this state to its producers in this state shall be26
uniform and equal as to all classes of producers of such insurer throughout this state.27 ENROLLEDHB NO. 283
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§1558. Appointments1
* * *2
B.3
* * *4
(3) Each insurer shall submit to the commissioner of insurance, in a manner5
prescribed by the commissioner, a list of appointed producers which it intends to6
appoint or reappoint. Each insurer shall remit, in a manner prescribed by the7
commissioner, appointment fees in the amount amounts set forth in R.S. 22:821.8
Any insurer who fails to file its renewal company appointments will be fined ten9
dollars per license named in its appointment form, or as otherwise authorized by R.S.10
22:821.11
(4) An appointment as provided herein for in this Section shall remain in full12
force and effect until the following date of recordation, renewal, unless the license13
of the appointed producer named therein is revoked by the commissioner as provided14
for in this Subpart, or until canceled by the insurer upon written notice to the15
producer with a copy thereof filed with the commissioner.16
* * *17
C. Any insurance producer, unless otherwise prohibited by contract, licensed18
in this state, may solicit, negotiate, or effect applications for policies of insurance19
with any insurer lawfully doing business in this state, other than an insurer such20
producer is licensed appointed to represent, if such producer is under contract with21
such insurer. However, no commissions shall be paid by such company insurer to22
the producer until such time as notice of recordation of the appointment with respect23
to such producer has been received by the producer from has been recorded by the24
commissioner.25
D. If any producer is operating or intends to operate its business affairs as26
a partnership, corporation, or other business entity, the appointments herein in this27
Section may be issued by an insurer in the name of such partnership, corporation, or28
other business entity, upon application, to be licensed as an insurance producer under29
this Subpart, provided if all persons in said such partnership, corporation, or other30 ENROLLEDHB NO. 283
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business entity actively engaged in soliciting, negotiating, or effecting contracts of1
insurance or renewals thereof also hold an unexpired producer's active2
producer license issued in accordance with the provisions of this Subpart.3
§1559. Notification to commissioner of termination4
* * *5
C. The insurer or the authorized representative of the insurer shall promptly6
notify the commissioner of insurance, in a manner acceptable to the commissioner,7
if, upon further review or investigation, the insurer discovers additional information8
that would have been reportable to the commissioner of insurance in accordance with9
Subsection B of this Section had the insurer then known of its existence.10
D.(1) Within fifteen days after making any notification required by11
Subsections A, B, or C, of this Section, the insurer shall mail a copy of the12
notification to the producer at his last known address. If the producer is terminated13
for cause for any of the reasons specified in R.S. 22:1554, the insurer shall provide14
a copy of the notification to the producer at his last known address by certified mail,15
return receipt requested, postage prepaid or by overnight delivery using a nationally16
recognized carrier.17
* * *18
E.(1) In the absence of actual malice, neither an insurer, the authorized19
representative of the insurer, a producer, the commissioner of insurance, nor or any20
organization of which the commissioner is a member and that compiles the21
information and makes it available to other state insurance officials or regulatory or22
law enforcement agencies, shall not be subject to civil liability., and a No civil cause23
of action of any nature shall not arise against these entities or their respective agents24
producers or employees, as a result of any statement or information required by or25
provided pursuant to this Section or any information relating to any statement that26
may be requested in writing by the commissioner, from an insurer or producer; or a27
statement by a terminating insurer or producer to an insurer or producer limited28
solely and exclusively to whether a termination for cause under pursuant to29
Subsection B of this Section was reported to the commissioner, provided that if the30 ENROLLEDHB NO. 283
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propriety of any termination for cause under pursuant to Subsection B of this Section1
is certified in writing by an officer or authorized representative of the insurer or2
producer terminating the relationship.3
* * *4
§1562. Prohibited acts5
* * *6
C.(1) It shall be unlawful for any person or business entity, without7
conforming to the provisions of this Part, directly or indirectly, to represent himself8
or itself to be an insurance producer or limited lines producer, or to solicit, negotiate,9
or effect any contract of insurance or renewal thereof, or to attempt to effect the10
same on any property, or risk or insurable interests or business activities, located11
within or transacted within this state. This Subsection shall not apply to:12
* * *13
(b) Employees of insurance companies insurers who solicit insurance only14
for or in conjunction with licensed insurance producers compensated on a15
commission basis.16
* * *17
(d) Employees of insurance companies insurers who do not solicit insurance18
but are authorized by their employer to sign policies of insurance.19
* * *20
E.21
* * *22
(2) Except as hereinafter provided in Paragraph (3) of this Subsection, any23
person or business entity shall be liable for the full amount of any loss sustained on24
any contract of insurance made by or through him or it, directly or indirectly, with25
any insurer not lawfully authorized to transact business in this state, and for any26
taxes which may become due under any law of this state by reason of such contract.27
For purposes of this Section, any surplus lines insurer which is approved by the28 ENROLLEDHB NO. 283
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commissioner shall be considered lawfully authorized to transact business in this1
state.2
* * *3
H. No insurer, agent, or broker producer shall accept or process an4
application for coverage under a Medicare+Choice plan unless the following5
requirements are met:6
* * *7
(4) The Medicare enrollee is notified of any known change in health care8
providers that may reasonably result from the action of the agent or broker. producer.9
* * *10
§1564. Producers of record11
A.12
* * *13
(2) This Subsection establishes an agency relationship only for the matter of14
collection of premiums specifically referred to herein. in this Section.15
B.(1)(a) Any insurance company authorized to transact property, casualty,16
accident, or health insurance or bond business in this state or insurer issuing or17
delivering property, casualty, accident, or health insurance, or bonds in this state18
shall recognize a producer of record when selected by the owner of the policy or the19
first-named insured if there are multiple-named insureds in writing. The insurer20
shall recognize the producer of record for purposes of providing quotations or21
proposals or writing such policies or bonds. The insurer shall retain the producer of22
record who wrote such policies or bonds for the full term of the contracts or until the23
renewal date or termination of the contracts, whichever occurs first. The insurer24
shall not change or remove such producer by any producer of record letter which25
may be secured by another producer for purposes of providing a quotation or26
proposal or for writing such policies or bonds during the term of such contracts until27
the renewal date of the contracts, unless the change or removal is requested by the28
owner of the policy or the first-named insured if there are multiple-named insureds29 ENROLLEDHB NO. 283
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under a particular contract. In such case, such owner or insured shall select the new1
producer of record.2
* * *3
C. The provisions of this Section shall not apply to individually4
underwritten, guaranteed renewable limited benefit health insurance policies. or5
contracts authorized to be issued in this state.6
* * *7
§1571. Registered insurance agent producer and bail agent bond producer8
prelicensing program9
A.(1) The commissioner shall certify an educational program that meets the10
requirements of this Subpart and any rules or regulations promulgated pursuant to11
this Subpart as a registered insurance agent producer or bail agent bond producer12
prelicensing program. Any person who satisfactorily completes an educational13
program which has been certified as a registered insurance agent producer or bail14
agent bond producer prelicensing program pursuant to this Subpart shall satisfy the15
preexamination educational requirements of R.S. 22:1571(E).16
(2) For purposes of this Subpart, "bail agent bond producer" shall mean any17
person, corporation, or partnership which holds an insurance license and has a18
contract and an appointment from an insurance company insurer licensed and19
authorized to provide surety in Louisiana.20
B. The commissioner shall promulgate rules and regulations setting forth21
guidelines and requirements for the content and conduct of a registered insurance22
agent or bail agent bond producer prelicensing program and for the procedure for23
certification of an instructional program as a registered insurance agent producer or24
bail bond producer prelicensing program. The commissioner shall also promulgate25
rules and regulations specifying the qualifications which each instructor in a26
registered insurance agent producer or bail agent bond producer prelicensing27
program shall possess. All such rules and regulations promulgated by the28
commissioner shall be promulgated pursuant to the provisions of the Administrative29
Procedure Act.30 ENROLLEDHB NO. 283
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C. Each registered insurance agent producer or bail agent bond producer1
prelicensing program shall be conducted by one of the following:2
(1) An insurance trade association;.3
(2) An insurance company admitted to do business in Louisiana ;.4
(3) An accredited public or private college or university; or.5
(4) An organization recommended by and certified by the commissioner of6
insurance.7
D. Each instructor in a registered insurance agent producer or bail bond8
producer prelicensing program shall possess the qualifications promulgated by the9
commissioner of insurance for instructors in such programs.10
E.(1) Each registered insurance agent producer or bail bond producer11
prelicensing program shall provide instruction by a qualified instructor in a12
structured setting or by verifiable approved self-study with a minimum of twenty13
hours of supervised instruction or self-study, including instruction in applicable14
insurance principles, state laws and regulations, and ethical practices, for each of the15
following lines of authority a license is sought: life, health and accident, property,16
casualty, and personal lines.17
(2) Each registered bail agent bond producer prelicensing program shall18
provide instruction by a qualified instructor in a structured setting with a minimum19
of eight hours of supervised instruction, including instruction in applicable20
underwriting principles, state laws and regulations, and ethical practices.21
F. While instruction is in progress in a registered insurance agent producer22
or bail agent bond producer prelicensing program, the instructor shall permit the23
commissioner, any member of the Insurance Education Advisory Council, and or any24
employee of the Department of Insurance to attend any educational session. Such25
access shall be for the purpose of monitoring the instruction and program and shall26
not be disruptive to the instruction. Any person who attends any educational session27
pursuant to the authority of this Subsection shall do so in an official capacity only.28
No information or materials shall be used for any personal reasons or gain.29 ENROLLEDHB NO. 283
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G. The director or supervisor of each registered insurance agent producer or1
bail agent bond producer prelicensing program shall submit its current course2
materials to the commissioner of insurance for his review upon his request but no3
less frequently than every three years.4
H. In accordance and compliance with R.S. 49:961, the commissioner may5
cancel or suspend the certification of any registered insurance agent or bail agent6
bond producer prelicensing program which does not meet the requirements of this7
Subpart or of any of the rules or regulations promulgated pursuant to this Subpart.8
Such cancellation or suspension shall be made after notice and an opportunity for9
hearing. An aggrieved party affected by the commissioner's decision, act, or order10
may demand a hearing in accordance with Chapter 12 of this Title, R.S. 22:2191 et11
seq.12
§1573. Continuing education requirements13
* * *14
C. Beginning with renewals effective in 2010, life Life insurance agents15
producers and health insurance agents producers shall complete twenty-four hours16
of approved instruction or verifiable approved self-study prior to each renewal of17
license, with at least three hours dedicated to the subject of ethics.18
D. Beginning with renewals effective in 1993, insurance brokers, solicitors,19
and agents Insurance producers authorized to write property, casualty, or property20
and casualty or personal lines insurance business shall complete twenty-four hours21
of approved instruction or verifiable approved self-study before each renewal of22
license. Beginning with renewals effective in 2007, three hours of approved23
instruction shall be dedicated to flood insurance. Beginning with renewals effective24
in 2011, with at least three hours of approved instruction shall be dedicated to the25
subject of ethics.26
E. For brokers, solicitors, and agents producers authorized both to write life,27
health and accident insurance and also authorized to write property, casualty, or28
property and casualty or personal lines insurance business, the continuing education29
requirement for renewal of license shall be twenty-four hours of approved instruction30 ENROLLEDHB NO. 283
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or verifiable approved self-study. Beginning with renewals effective in 2011, with1
at least three hours of approved instruction or verifiable approved self-study shall be2
dedicated to the subject of ethics.3
F.(1) For bail agents and solicitors bond producers, the continuing education4
requirement for renewal of license shall be twelve hours of approved bail5
underwriting instruction.6
G. No more than ten excess hours of approved property and casualty7
insurance instruction and no more than ten excess hours of approved life, and health8
and accident insurance instruction accumulated during the previous one renewal9
period may be carried forward and applied to the continuing education requirement10
for the next renewal period.11
* * *12
I.(1)(a) The provisions of this Section, imposing continuing education13
requirements for renewal of a license, shall not apply to any person sixty-five years14
of age or older on January 1, 2012, who has at least fifteen years of experience as a15
licensed agent, broker, or solicitor, producer and who either:16
(i) Is no longer actively engaged in the insurance business as an agent,17
broker, or solicitor a producer and who is receiving social security benefits, if18
eligible.19
(ii) Is actively engaged in the insurance business as an agent, broker, or20
solicitor a producer and who represents or operates through a licensed Louisiana21
insurer.22
* * *23
K. The department may grant four continuing education credits, as24
determined by the commissioner, to a licensed agent or broker producer who is a25
member of, and actively participates in, a state or national insurance association.26
L. Beginning with renewals effective in 2006, title insurance agents, Title27
producers licensed pursuant to Subpart R of Part I of Chapter 2 of this Title, R.S.28
22:511 et seq., shall complete six hours of approved instruction prior to the renewal29
of the license.30 ENROLLEDHB NO. 283
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M. Any agent, property and casualty producer, upon receiving his initial1
license, shall complete three hours of approved instruction dedicated to flood2
insurance on his first license renewal when continuing education is required.3
§1574. Bail Bond Apprentice Program4
A.(1) The Bail Bond Apprentice Program is hereby created.5
(2) The Bail Bond Apprentice Program shall be available only to persons6
who meet current bail bond producer licensing requirements as provided for in7
Chapter 5 of this Title and who have not been convicted of a felony.8
(3) Apprentices shall complete the registered insurance producer and bail9
bond producer prelicensing program as provided for in R.S. 22:1571 before the end10
of the apprenticeship program.11
B. The Bail Bond Apprentice Program shall consist of six consecutive12
months of employment by a Louisiana Department of Insurance licensed bail bond13
producer. The apprentice shall be supervised by the producer during the six-month14
period and work for no less than twenty-four hours per week. The apprentice shall15
observe the bail bond producer, perform every phase of the bail bond business, and16
shall perform duties in every phase of the bail bond business except for the17
solicitation, negotiation, quotation of fees, and the execution of a bail bond.18
C. The supervising bail bond producer shall maintain records to support that19
the apprentice has worked the required number of hours. These records shall include20
time sheets and pay stubs, and shall be made available for examination and review21
to the Department of Insurance upon request.22
D.(1) Upon completion of the required six months of work experience,23
without expulsion, the apprentice and the supervising bail bond producer shall24
certify, on a form provided by the Department of Insurance, that the apprentice has25
completed all of the requirements of the apprentice program. This form shall be a26
notarized sworn affidavit, completed under penalty of perjury.27
* * *28
§1575. Producer training requirements to sell long-term care insurance29
* * *30 ENROLLEDHB NO. 283
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C.1
* * *2
(2) Insurers shall maintain records with respect to the training of its3
producers concerning the distribution of its partnership policies that will allow the4
state insurance department to provide assurance to the state Medicaid agency that5
producers have received the training contained in Subparagraph (B)(2)(a) of this6
Section as required by Subsection A of this Section and that producers have7
demonstrated an understanding of the partnership policies and their relationship to8
public and private coverage of long-term care, including Medicaid, in this state. The9
aforementioned These records shall be maintained in accordance with the state's10
record retention requirements and shall be made available to the commissioner upon11
request.12
D. The satisfaction of said such training requirements in any state shall be13
deemed to satisfy the training requirements in this state.14
* * *15
§1583. Licensing and fees16
Except as provided by the regulations authorized in this Subpart, bail17
enforcement agents shall be subject to the same licensing and fee requirements as18
bail bond insurance agents. producers.19
§1584. Bond Bail bond producers; prohibitions; penalties20
* * *21
§1585. Surrender for nonpayment of premium22
* * *23
C. Upon first violation, a bail bond producer who surrenders a client for24
nonpayment of a premium in violation of this Section shall be subject to a suspension25
of his license for not more than six months and fined an amount not to exceed five26
thousand dollars. A second or any subsequent violation may be punishable by27
permanent revocation of the bail bond producer's license and a fine not to exceed ten28
thousand dollars.29
* * *30 ENROLLEDHB NO. 283
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§1591. Short title1
This Chapter Subpart may be cited as the "Financial Institution Insurance2
Sales Law".3
§1592. Purpose4
The legislature hereby declares that the purpose of this Chapter Subpart is to5
regulate the business of insurance in Louisiana and to protect the interests of6
insurance policyholders in this state.7
§1593. Definitions8
A. For the purposes of this Chapter: Subpart:9
(1) "Financial institution" means a state or national bank or branch thereof10
which accepts federally insured deposits or makes loans from a place of business11
located in the state of Louisiana or any subsidiary or employee thereof, or a bank12
holding company or subsidiary or employee thereof, only if the bank holding13
company owns or controls a state or national bank or branch thereof which accepts14
federally insured deposits or makes loans from a place of business located in the15
state of Louisiana. The term financial institution does not include a bank which was16
engaged as an insurance agent producer on January 1, 1984, or an insurance17
company.18
* * *19
§1594. Applicability20
The provisions of this Chapter Subpart shall not apply to the following:21
* * *22
§1595. Authorization for implementing regulations23
The commissioner of insurance shall have the authority to promulgate rules24
and regulations in accordance with the authority granted by the Administrative25
Procedure Act as may be necessary to effectuate the provisions of this Chapter.26
Subpart. However, the commissioner of insurance shall not impose any additional27
requirement on any insurance agent or broker producer who is associated with a28
financial institution that is not imposed on any insurance agent producer who is not29 ENROLLEDHB NO. 283
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associated with such institution unless such requirement is set forth in this Chapter.1
Subpart.2
* * *3
§1597. Sales force4
The solicitation of a customer of a financial institution for the purchase or5
sale of insurance shall not be conducted by any natural person directly responsible6
for making a specific loan or extension of credit to that customer before such time7
as the final decision regarding the acceptance or denial of that specific loan or8
extension of credit is made and communicated in writing to the customer. For the9
purposes of this Chapter, Subpart, solicitation does not include referral of the10
customer to a licensed insurance agent producer not directly responsible for making11
the specific loan or extension of credit, informing the customer that the required12
insurance is available from the financial institution, or providing the customer with13
any disclosures which are required by R.S. 22:1600.14
§1598. Referrals15
* * *16
C. Any person or entity responsible for making a specific loan or extension17
of credit may receive a reasonable referral fee for the insurance referral of a18
customer who is required to provide insurance for that loan or extension of credit.19
An insurance referral fee paid to such person or entity making a specific loan or20
extension of credit shall not be in the form of an insurance sales commission which21
varies based on the quotation or application for insurance, purchase of insurance, or22
the amount of premium written. The insurance referral fee shall be paid solely on23
the basis of the referral. This Section shall not preclude a person directly or24
indirectly responsible for making a specific loan or extension of credit, who is a25
licensed insurance producer, from soliciting and selling insurance to a loan customer26
and earning a commission, so long as the solicitation and sale is conducted after the27
final loan decision has been communicated to the customer in writing, in accordance28
with the provisions of R.S. 22:1597. The customer shall also be notified that they29
are he is not required to purchase insurance through the financial institution, and the30 ENROLLEDHB NO. 283
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customer's choice of another insurance provider will not affect the financial1
institution's credit decision or credit terms in any way.2
§1599. Insurance as a condition to service3
A. A financial institution shall not in any manner extend credit, lease, or sell4
property of any kind, or furnish any service, or fix or vary the consideration for any5
of the foregoing, on the condition or requirement that the customer shall obtain6
insurance from the financial institution. In accordance with the foregoing, provisions7
of this Subpart, the financial institution shall not represent that the purchase of an8
insurance product from a financial institution by a customer or prospective customer9
of the institution is required as a condition of, or is any way related to, the lending10
of money or extension of credit, the establishment or maintenance of a trust account,11
the establishment or maintenance of a checking, savings, or deposit account, or the12
provision of services related to any such activities.13
* * *14
C. The following activities conducted in accordance with the provisions of15
this Chapter Subpart shall not violate the provisions of this Section:16
* * *17
§1600. Disclosures; Disclosure; required18
* * *19
B. The financial institution shall give the customer the disclosures disclosure20
provided in Subsection A of this Section when it first informs the customer that21
required insurance is available from the financial institution if:22
* * *23
§1603. No discrimination against non-affiliated agents producers24
No financial institution may:25
(1) Offer a banking product or service, or fix or vary the conditions of such26
offer, on a condition or requirement that the customer obtain insurance from any27
particular agent or broker. producer.28
* * *29 ENROLLEDHB NO. 283
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(3) Impose any unreasonable requirement on any insurance agent or broker1
producer who is not associated with the financial institution that is not imposed on2
any insurance agent producer who is associated with such institution.3
§1604. Customer privacy; protections4
A. As used in this Section, unless the context requires otherwise:5
* * *6
(2) "Nonpublic customer information" means information maintained by a7
financial institution relating to insurance coverage purchased by a customer from an8
insurer, insurance agency, or insurance agent producer that is not affiliated with the9
financial institution. "Nonpublic customer information" does not include customer10
names, addresses and telephone numbers, or any information relating to deposit or11
investment accounts, loans, or other extensions of credit, or the credit history or12
financial condition of a customer. Nonpublic customer information includes13
information concerning insurance escrow accounts, insurance premiums, the terms14
and conditions of insurance coverage, insurance expirations, insurance claims, and15
insurance history of an individual, when such information relates to insurance16
coverage purchased by a customer from an insurer, insurance agency, or insurance17
agent producer that is not affiliated with that financial institution.18
* * *19
§1605. Unfair trade practice20
Failure to comply with any of the provisions of this Chapter Subpart shall be21
an unfair method of competition and an unfair or deceptive act or practice subject to22
regulation by the commissioner of insurance as provided by law, including R.S.23
22:1554 and 1967 through 1972.24
* * *25
§1622. Definitions26
As used in this Part, unless the context requires otherwise, the following27
definitions shall be applicable: 28
A. (1) "Actuary" means a person who is a member in good standing of the29
American Academy of Actuaries.30 ENROLLEDHB NO. 283
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B. (2) "Commissioner" means the commissioner of insurance of this state.1
as defined in R.S. 22:46.2
C. (3) "Insurer" means any person , firm, association, or corporation duly3
licensed in this state as an insurer pursuant to this Chapter.4
D.(1) (4)(a) "Managing General Agent" (MGA) means any person , firm,5
association, or corporation who manages all or part of the insurance business of an6
insurer, including the management of a separate division, department, or7
underwriting office, and acts as an agent for such insurer whether known as a8
managing general agent, manager, or other similar term, who, with or without the9
authority, either separately or together with affiliates, produces, directly or indirectly,10
and underwrites an amount of gross direct written premium equal to or more than11
five percent of the policyholder surplus as reported in the last annual statement of the12
insurer in any one quarter or year together with one or more of the following:13
(a) (i) Adjusts or pays claims in excess of an amount determined by the14
commissioner; or. 15
(b) (ii) Negotiates reinsurance on behalf of the insurer.16
(2) (b) Notwithstanding the above the preceding provisions of this17
Subsection, the following persons shall not be considered as MGAs for the purposes18
of this Part:19
(a) (i) An employee of the insurer.20
(b) (ii) A United States manager of the United States branch of an alien21
insurer.22
(c) (iii) An underwriting manager, which, pursuant to contract, manages all23
the insurance operations of the insurer, is under common control with the insurer,24
subject to the Insurance Holding Company System Regulatory Act, Law, R.S. 22:69125
et seq. and whose compensation is not based on the volume of premiums written.26
(d) (iv) The attorney authorized by and acting for the subscribers of a27
reciprocal insurer or inter-insurance exchange under powers of attorney.28
E. "Underwrite" means the authority to accept or reject risk on behalf of the29
insurer.30 ENROLLEDHB NO. 283
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(5) "Person" shall have the same meaning as set forth in R.S. 22:1542.1
F. (6) "Producer"or "insurance producer" means a person currently licensed2
as a property and casualty agent, producer in accordance with the provisions of this3
Title, who is properly appointed to represent the insurer for the lines of insurance for4
which he is performing the duties of a managing general agent as defined herein. in5
this Part.6
(7) "Underwrite" means the authority to accept or reject risk on behalf of the7
insurer.8
§1623. Licensure; registration9
A. No person, firm, association, or corporation shall act in the capacity of an10
MGA with respect to risks located in this state for an insurer licensed in this state11
unless such person is a licensed producer in this state.12
B. No person, firm, association, or corporation shall act in the capacity of an13
MGA representing an insurer domiciled in this state with respect to risks located14
outside this state unless such person is licensed as a resident or nonresident producer15
in this state pursuant to the provisions of this Part.16
* * *17
D. No person, firm, association, or corporation shall act in the capacity of an18
MGA in this state unless such person, firm, association, or corporation has registered19
his name, current residential address, current mailing address, and current business20
address with the commissioner, on forms prescribed by the commissioner, together21
with a fee in the amount set forth in R.S. 22:821.22
* * *23
F. If a person, firm, association, or corporation fails to provide any of the24
information required under pursuant to this Section, the commissioner may, after25
notification by the commissioner to the person, firm, association, or corporation by26
certified mail of such failure, impose a fine not to exceed fifty dollars.27
* * *28 ENROLLEDHB NO. 283
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§1624. Required contract provisions1
A. No person, firm, association, or corporation acting in the capacity of an2
MGA shall place business with an insurer unless there is in force a written contract3
between the parties which sets forth the responsibilities of each party and, when both4
parties share responsibility for a particular function, specifies the division of such5
responsibilities, and which contains the following minimum provisions:6
A. (1) The insurer may terminate the contract for cause upon written notice7
to the MGA. The insurer may suspend the underwriting authority of the MGA8
during the pendency of while any dispute regarding the cause for termination. is9
pending.10
B. (2) The MGA shall render accounts to the insurer detailing all transactions11
and remit all funds due under the contract to the insurer on not less than a monthly12
basis.13
C. (3) All funds collected for the account of an insurer shall be held by the14
MGA in a fiduciary capacity in a bank which is a member of the Federal Deposit15
Insurance Corporation (FDIC). This account shall be used for all payments on behalf16
of the insurer. The MGA may retain no more than three months' estimated claims17
payments and allocated loss adjustment expenses.18
D. (4) Separate records of business written by the MGA shall be maintained.19
The insurer shall have access and right to copy all accounts and records related to its20
business in a form usable by the insurer, and the commissioner shall have access to21
all books, bank accounts, and records of the MGA in a form usable to the22
commissioner. Such records shall be retained pursuant to rules and regulations23
promulgated by the commissioner.24
E. (5) The contract may not be assigned in whole or part by the MGA.25
F. (6) Appropriate underwriting guidelines including:26
(1) (a) The maximum annual premium volume.27
(2) (b) The basis of the rates to be charged.28
(3) (c) The types of risks which may be written.29
(4) (d) Maximum limits of liability.30 ENROLLEDHB NO. 283
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(5) (e) Applicable exclusions.1
(6) (f) Territorial limitations.2
(7) (g) Policy cancellation provisions.3
(8) (h) The maximum policy period.4
G. (7) The insurer shall have the right to cancel or nonrenew any policy of5
insurance pursuant to the laws and regulations applicable thereto.6
H. (8) If the contract permits the MGA to settle claims on behalf of the7
insurer:8
(1) (a) All claims shall be reported to the company insurer in a timely9
manner.10
(2) (b) A copy of the claim file shall be sent to the insurer at its request or11
as soon as it becomes known that the claim meets at least one of the following12
criteria:13
(a) (i) Has the potential to exceed an amount determined by the14
commissioner or exceeds the limit set by the company, whichever is less ;.15
(b) (ii) Involves a coverage dispute;.16
(c) (iii) May exceed the MGA's claims settlement authority;.17
(d) (iv) Is open for more than six months; or.18
(e) (v) Is closed by payment of an amount set by the commissioner or an19
amount set by the company, insurer, whichever is less.20
(3) (c) All claim files shall be the joint property of the insurer and MGA.21
However, upon an order of liquidation of the insurer, files shall become the sole22
property of the insurer or its estate. The MGA shall have reasonable access to and23
the right to copy the files on a timely basis.24
(4) (d) Any settlement authority granted to the MGA may be terminated for25
cause upon the insurer's written notice to the MGA or upon the termination of the26
contract. The insurer may suspend the settlement authority during the pendency of27
any dispute regarding the cause for termination.28
I. (9) When electronic claims files are in existence, the contract shall address29
the timely transmission of the data.30 ENROLLEDHB NO. 283
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J. (10) If the contract provides for a sharing of interim profits by the MGA,1
and the MGA has the authority to determine the amount of the interim profits by2
establishing loss reserves, controlling claim payments, or in any other manner,3
interim profits shall not be paid to the MGA until one year after they are earned for4
property insurance business and five years after they are earned for casualty business5
and not until the profits have been verified pursuant to R.S. 22:1625 of this Part.6
K. B. The MGA shall not:7
(1) Bind reinsurance or retrocessions on behalf of the insurer, except that the8
MGA may bind facultative reinsurance contracts pursuant to obligatory facultative9
agreements if the contract with the insurer contains reinsurance underwriting10
guidelines including, for reinsurance both assumed and ceded, a list of reinsurers11
with which such automatic agreements are in effect, the coverages and amounts or12
percentages that may be reinsured and commission schedules.13
(2) Commit the insurer to participate in insurance or reinsurance syndicates.14
(3) Appoint any producer without assuring that the producer is lawfully15
licensed to transact the type of insurance for which he is appointed.16
(4) Without prior approval of the insurer, pay or commit the insurer to pay17
a claim over a specified amount, net of reinsurance, which shall not exceed one18
percent of the insurer's policyholder's surplus as of December thirty-first of the last19
completed calendar year.20
(5) Collect any payment from a reinsurer or commit the insurer to any claims21
settlement with a reinsurer, without prior approval of the insurer. If prior approval22
is given, a report shall be promptly forwarded to the insurer.23
(6) Permit its subproducer to serve on its board of directors.24
(7) Appoint a sub-MGA.25
(8) Jointly employ an individual who is employed with the insurer.26
§1625. Duties of insurers27
A. If an insurer has an MGA who writes more than five percent of its28
policyholder surplus, then the insurer shall provide financial data by an independent29
examiner concerning that company's insurer's book of business which is in question30 ENROLLEDHB NO. 283
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and is handled by that MGA upon request, and the insurer shall have on file an1
independent financial examination, in a form acceptable to the commissioner, of2
each MGA with which it has done business.3
* * *4
H. All such appointments shall remain in full force and effect until April5
thirtieth of the following year unless:6
(1) The producer license of the MGA is revoked or suspended by the7
commissioner as provided for in this Part or as prescribed in R.S. 22:1554.8
(2) The insurer has cancelled the appointment upon written notice to the9
agent producer and to the commissioner.10
* * *11
§1627. Penalties; suspension, revocation, fines, and liabilities12
A. If the commissioner finds after a hearing conducted in accordance with13
the Administrative Procedure Act, R.S. 49:950 et seq., that any person has violated14
any provision of this Part, the commissioner may order:15
* * *16
(2) Revocation or suspension of the producer's producer license. of the17
MGA.18
* * *19
PART III. THIRD PARTY THIRD-PARTY ADMINISTRATORS20
§1641. Definitions21
The following terms shall have the following meanings: As used in this Part,22
unless the context requires otherwise, the following definitions shall be applicable:23
(1) "Administrator" or "third-party administrator" or "TPA" means any24
individual, partnership, corporation, or other person, except an employee of a fund25
or plan that serves as an administrator, who directly or indirectly solicits or effects26
coverage of, underwrites, collects charges or premiums from, or adjusts or settles27
claims on residents of this state, or residents of another state from offices in this28
state, in connection with life or health insurance coverage or annuities, or plans of29
self-insurance providing accident and health protection or self-insurance of workers'30 ENROLLEDHB NO. 283
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compensation coverage, or any individual, partnership, corporation, or other person1
who contracts directly or indirectly with a group self-insurance fund licensed2
pursuant to the provisions of R.S. 23:1195 et seq. to provide claims adjusting,3
underwriting, safety engineering, loss control, marketing, investment advisory, or4
administrative services to the fund or its membership, other than bookkeeping,5
auditing, or claims investigation services, except any of the following:6
* * *7
(c) An agent or broker insurance producer licensed to sell life or health8
insurance in this state, whose activities are limited exclusively to the sale of9
insurance.10
* * *11
(g) A credit union or a financial institution which is subject to supervision12
or examination by federal or state banking authorities, or a mortgage lender, to the13
extent they collect and remit premiums to licensed insurance agents producers or14
authorized insurers in connection with loan payments.15
* * *16
(j) A person who acts solely as an administrator of one or more bona fide17
employee benefit plans established by an employer or an employee organization, or18
both, for which the insurance laws of this state are preempted pursuant to the19
Employee Retirement Income Security Act of 1974 . (29 U.S.C. 1001 et seq.).20
* * *21
(4) "Control" as means as defined in R.S. 22:692.22
* * *23
(7) "Person" shall have the same meaning as set forth in R.S. 22:1542.24
(8) "Pharmacy benefit manager" means a person, business, or other entity and25
any wholly or partially owned or controlled subsidiary of such entity that administers26
the prescription drug or device portion of one or more health benefit plans on behalf27
of a third party, including plan sponsors, insurance companies, unions, and health28
maintenance organizations, in accordance with a pharmacy benefit management29
plan.30 ENROLLEDHB NO. 283
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(7) (9) "Underwrites" or "underwriting" means but is not limited to the1
acceptance of employer or individual applications for coverage of individuals in2
accordance with the written rules of the insurer, the overall planning and3
coordinating of an insurance program, and the ability to procure bonds and excess4
insurance.5
§1642. Necessity of written agreement6
A. No administrator shall act as such without a written agreement between7
the administrator and the insurer and such written agreement shall be retained as part8
of the official records of both the insurer and the administrator for the duration of the9
agreement and for five years thereafter. The agreement shall contain all provisions10
required by this statute, except insofar as unless those requirements do not apply to11
the functions performed by the administrator.12
* * *13
C. The insurer or administrator may, with written notice, terminate the14
written agreement for cause as provided in the agreement. The insurer may suspend15
the underwriting authority of the administrator during the pendency of while any16
dispute regarding the cause for termination of the written agreement. is pending. The17
insurer must fulfill any lawful obligations with respect to policies affected by the18
written agreement, regardless of any dispute between the insurer and the19
administrator.20
* * *21
§1644. Maintenance of information22
* * *23
D. In the event the insurer and the administrator cancel their agreement,24
notwithstanding the provisions herein, in this Part, the administrator may transfer all25
records to the insurer or a succeeding administrator selected by the insurer and26
licensed in the state, rather than retain them for five years. In the event of a27
cancellation under this Subsection, the succeeding administrator or the insurer shall28
acknowledge and agree, in writing, that the administrator or insurer shall be29 ENROLLEDHB NO. 283
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responsible for retaining the records of the prior administrator as required herein. in1
this Part.2
* * *3
§1651. Licensure required4
* * *5
B. Applicants under this Section shall pay a licensing fee in an amount set6
forth in R.S. 22:821 and shall make an application to the commissioner upon a form7
to be furnished by the commissioner. The application shall include or be8
accompanied by the following information and documents:9
* * *10
(6) If the applicant will be managing the solicitation of new or renewal11
business, proof that it employs or has contracted with an agent insurance producer12
licensed by this state for solicitation and taking of applications. Any applicant who13
intends to directly solicit insurance contracts or to otherwise act as an insurance14
agent producer must shall provide proof that he has a license as an insurance agent15
producer in this state.16
* * *17
D. The commissioner may refuse to issue a license if the commissioner18
determines that the administrator, or any individual responsible for the conduct of19
affairs of the administrator as defined herein, in this Part, is not competent,20
trustworthy, financially responsible or of good personal and business reputation, or21
has had an insurance or an administrator license denied or revoked for cause by any22
state.23
* * *24
H. A licensed administrator shall notify the commissioner of any material25
change in fact or circumstance affecting its qualification for a license in this state26
within sixty days of the effective date of the change. The notice shall include any27
documentation as the commissioner may require. Changes in fact or circumstances28
shall include:29 ENROLLEDHB NO. 283
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(1) Changes in control. as defined in R.S. 22:692(3).1
* * *2
I.(1) A licensed administrator shall maintain and keep in full force and effect3
a surety bond in an amount of one hundred thousand dollars issued by an authorized4
surety company doing business in this state, or deposit with the commissioner a5
safekeeping or trust receipt from a bank doing business in the state or from a savings6
and loan association chartered to do business in this state indicating that the7
administrator has deposited one hundred thousand dollars in money, or bonds of the8
United States, the state of Louisiana, or any political subdivision thereof of the par9
value of one hundred thousand dollars. The surety bond or the money or the10
securities shall be held in trust for the benefit and protection of and as security for11
all policyholders of the insurer and participants of the plan with whom the12
administrator contracts. The provisions of this Paragraph shall not apply to13
administrators required to post a surety bond in accordance with the provisions of14
R.S. 23:1196(C)(1), in providing services for a group self-insurance fund for15
workers' compensation insurance.16
* * *17
§1652. Waiver of application for certification18
Upon request from an administrator, the commissioner may waive the19
application requirements herein in this Part if the administrator has a valid license20
as an administrator issued in a state which has standards for administrators that are21
at least as stringent as those contained in the model statute for third-party22
administrators of the National Association of Insurance Commissioners.23
* * *24
§1654. Grounds for suspension or revocation of license25
A. The license of an administrator shall be suspended or revoked, or in lieu26
of said revocation, a fine may be imposed for each separate violation, not to exceed27
five thousand dollars per violation, or twenty-five thousand dollars in the aggregate,28
if the commissioner finds that the administrator: The commissioner shall suspend or29
revoke, or in lieu of revocation, impose a fine for each separate violation not to30 ENROLLEDHB NO. 283
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exceed five thousand dollars per violation or twenty-five thousand dollars in the1
aggregate if he finds that the administrator:2
* * *3
C. The commissioner may, in his or her discretion and without advance4
notice or hearing thereon, immediately suspend the certificate of any administrator5
if the commissioner finds that either of the following circumstances exist:6
* * *7
§1657. Pharmacy benefit managers8
A. "Pharmacy benefit manager" means a person, business, or other entity and9
any wholly or partially owned or controlled subsidiary of such entity that administers10
the prescription drug or device portion of one or more health benefit plans on behalf11
of a third party, including plan sponsors, insurance companies, unions, and health12
maintenance organizations, in accordance with a pharmacy benefit management13
plan.14
B. A pharmacy benefit manager shall be deemed to be a third-party15
administrator for purposes of this Part. As such, all provisions of this Part shall16
apply to pharmacy benefit managers; however, notwithstanding the provisions of17
R.S. 22:1651(F), every pharmacy benefit manager shall be required to be licensed18
by the commissioner of insurance. except if exempted pursuant to R.S. 22:1651(G).19
* * *20
§1662. General exemptions21
This Part does not apply to:22
* * *23
(6)(a) An individual who collects claim information from, or furnishes claim24
information to, insured insureds or claimants, who conducts data entry including25
entering data into an automated claims adjudication system provided if such26
individual is an employee of a business entity licensed pursuant to this Chapter, or27
an employee of an affiliate of a business entity licensed pursuant to the Chapter, if28
there are no more than twenty-five individuals under the supervision of one licensed29
individual adjuster or licensed individual insurance producer. As used in this Part,30 ENROLLEDHB NO. 283
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"automated claims adjudication system" means a preprogrammed computer system1
designed for the collection, data entry, calculation and system generated final2
resolution of consumer electronic products insurance claims which:3
* * *4
(14) A person handling commercial claims for excess coverages as classified5
by R.S. 22:47(14).6
* * *7
§1664. Application for claims adjuster license8
A. Beginning June 30, 2007, any Any person who is either employed or9
contracts to perform services in Louisiana as an adjuster shall obtain a license to do10
so from the Department of Insurance. A person applying for a claims adjuster11
license shall make application to the commissioner of insurance on the appropriate12
uniform application or other application prescribed required by the commissioner13
of insurance.14
* * *15
C.16
* * *17
(2) All business entities applying to do business as independent adjusting18
companies must shall provide a listing of all executive officers and directors of the19
applicant and of all executive officers and directors of entities owning and any20
individuals owning, directly or indirectly, ten percent or more of the outstanding21
voting securities of the applicant. In order to make a determination of eligibility, the22
commissioner may require any person listed above pursuant to this Paragraph to23
submit addresses, social security numbers, criminal and administrative history,24
fingerprints, background checks, and biographical statements.25
* * *26
§1665. Resident license27
A. Before issuing a claims adjuster license to an applicant under pursuant to28
this Section, the commissioner of insurance shall find that the applicant:29 ENROLLEDHB NO. 283
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(1) Is eligible to designate this state as his or her home state or is a1
nonresident who is not eligible for a license under pursuant to R.S. 22:1670.2
* * *3
§1669. Exemptions from examination4
A. An individual who applies for a claims adjuster license in this state who5
was previously licensed as a claims adjuster in another state based on a claims6
adjuster examination shall not be required to complete any prelicensing or an7
examination. This exemption is only available available only if the person is8
currently licensed in that state or if the application is received within twelve months9
of the cancellation of the applicant's previous claims adjuster license and if the prior10
state issues a certification that, at the time of cancellation, the applicant was in good11
standing in that state or the state's producer database records or records maintained12
by the National Association of Insurance Commissioners (NAIC), its affiliates, or13
subsidiaries, indicate that the adjuster is or was licensed in good standing.14
B. An individual licensed as a claims adjuster in another state based on a15
claims adjuster examination who moves to this state shall make application within16
ninety days of establishing legal residence to become a resident claims adjuster17
licensee pursuant to R.S. 22:1665. No prelicensing or examination shall be required18
of that person to obtain a claims adjuster license.19
C. Repealed by Acts 2010, No. 1007, §2.20
D. C An individual who applies for a claims adjuster license in this state who21
was previously licensed as a claims adjuster in this state shall not be required to22
complete any prelicensing or an examination. This exemption is only available23
available only if the application is received within twelve months of the cancellation24
of the applicant's previous claims adjuster license in this state and if, at the time of25
cancellation, the applicant was in good standing in this state, and had passed the26
examination required by R.S. 22:1668.27 ENROLLEDHB NO. 283
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§1670. Nonresident claims adjuster license reciprocity1
A. Unless denied licensure pursuant to R.S. 22:1672, a nonresident person2
may receive a nonresident claims adjuster license upon complying with the following3
requirements:4
* * *5
(2) The person has submitted the proper request for licensure along with the6
fees required by R.S.22:821.7
* * *8
D. As a condition to continuation of a nonresident claims adjuster license9
issued under pursuant to this Section, the nonresident claims adjuster licensee shall10
maintain a resident adjuster license in their his home state. The nonresident claims11
adjuster license issued under pursuant to this Section shall terminate and be12
surrendered immediately to the commissioner of insurance if the home state claims13
adjuster license terminates for any reason, unless the claims adjuster has been issued14
a license as a resident claims adjuster in their new home state and the new home state15
awards nonresident claims adjuster licenses to residents of this state on the same16
basis. Notification to the state or states where a nonresident license is issued must17
shall be made as soon as possible, yet no later than thirty days of change in the new18
state resident license. Licensee The licensee shall include the new and old his19
current and prior address. A new state resident license is required for nonresident20
licenses to remain valid. The new state resident license must have reciprocity with21
this state for the nonresident license not to terminate.22
§1671. License23
A. Unless denied licensure under pursuant to this Part, persons who have met24
the requirements of this Part shall be issued a claims adjuster license. The license25
shall contain the licensee's name, business address, personal identification license26
number, date of issuance, expiration date, and any other information the27
commissioner of insurance deems necessary.28
B.29
* * *30 ENROLLEDHB NO. 283
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(2) Every licensed claims adjuster shall file an application for renewal of his1
license every two years, by notifying the commissioner of insurance using methods2
prescribed required by the commissioner of insurance, of the licensee's intention to3
continue his license.4
C. The licensee shall inform the commissioner of insurance by any means5
acceptable to the commissioner of insurance of a change of address, change of legal6
name, or change of information submitted on the application within thirty days of the7
change. Failure to file a change within the required time shall subject the licensee8
to a fifty dollar fine per violation. or other fine as may be authorized by R.S. 22:821.9
Any person against whom a penalty has been levied shall be given due notice of such10
action. Upon receipt of this notice, the licensee may apply for and shall be entitled11
to a hearing in accordance and compliance with Chapter 12 of this Title, R.S.12
22:2191 et seq.13
* * *14
§1673. Continuing education15
* * *16
C. Only continuing education courses approved by the commissioner of17
insurance shall be used to satisfy the continuing education requirement of Subsection18
A. of this Section.19
* * *20
§1693. License required21
A. Beginning June 30, 2007, a A person shall not act or hold himself out as22
a public adjuster in this state unless the person is licensed as a public adjuster in23
accordance with this Part.24
* * *25
§1694. Application for license26
A. A person applying for a public adjuster license shall make application to27
the commissioner of insurance on the appropriate uniform application or other28
application prescribed required by the commissioner of insurance.29
* * *30 ENROLLEDHB NO. 283
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§1696. Examination1
A. An individual applying for a public adjuster license under pursuant to this2
Part shall pass a written examination unless exempt pursuant to R.S. 22:1697, 1698,3
and or 1699. The examination shall test the knowledge of the individual concerning4
the duties and responsibilities of a public adjuster and the insurance laws and5
regulations of this state. Examinations required by this Section shall be developed6
and conducted under pursuant to rules and regulations prescribed by the7
commissioner of insurance.8
* * *9
§1697. Exemptions from examination10
A. An individual who applies for a public adjuster license in this state who11
was previously licensed as a public adjuster in another state based on a public12
adjuster examination shall not be required to complete any prelicensing or13
examination. This exemption is only available available only if the person is14
currently licensed in that state or if the application is received within twelve months15
of the cancellation of the applicant's previous license and if the prior state issues a16
certification that, at the time of cancellation, the applicant was in good standing in17
that state or the state's producer database records or records maintained by the NAIC,18
its affiliates, or subsidiaries, indicate that the public adjuster is or was licensed in19
good standing.20
B. An individual licensed as a public adjuster in another state based on a21
public adjuster examination who moves to this state shall make application within22
ninety days of establishing legal residence to become a resident licensee pursuant to23
R.S. 22:1695. No prelicensing or examination shall be required of that person to24
obtain a public adjuster license.25
C. An individual who applies for a public adjuster license in this state who26
was previously licensed as a public adjuster in this state shall not be required to27
complete any prelicensing or examination. This exemption is only available28
available only if the application is received within twelve months of the cancellation29 ENROLLEDHB NO. 283
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of the applicant's previous license in this state and if, at the time of cancellation, the1
applicant was in good standing in this state.2
§1698. Nonresident license reciprocity3
A. Unless denied licensure pursuant to R.S. 22:1700, a nonresident person4
may receive a nonresident public adjuster license if:5
* * *6
(2) The person has submitted the proper request for licensure, has paid the7
fees required by R.S. 22:821 , and has provided proof of financial responsibility as8
required in R.S. 22:1701.9
* * *10
D. As a condition to continuation of a public adjuster license issued under11
pursuant to this Section, the licensee shall maintain a resident public adjuster license12
in his home state. The nonresident public adjuster license issued under pursuant to13
this Section shall terminate and be surrendered immediately to the commissioner of14
insurance if the home state public adjuster license terminates for any reason, unless15
the public adjuster has been issued a license as a resident public adjuster in his new16
home state and the new home state awards nonresident public adjuster licenses to17
residents of this state on the same basis. Notification to the state or states where the18
nonresident license is issued must shall be made as soon as possible, yet no later than19
thirty days of change in the new state resident license. Licensee The licensee shall20
include his new current and old prior address. The new state resident license is21
required for the nonresident license to remain valid. The new state resident license22
must have reciprocity with this state for the nonresident license not to terminate.23
§1699. License24
A.25
* * *26
(3) Every licensed public adjuster shall file an application for renewal of his27
license every two years by notifying the commissioner of insurance, by methods28
prescribed required by the commissioner of insurance, of the licensee's intention to29
continue his license.30 ENROLLEDHB NO. 283
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B. The licensee shall inform the commissioner of insurance by any means1
acceptable to the commissioner of insurance of a change of address, change of legal2
name, or change of information submitted on the application within thirty days of the3
change. Failure to file a change within the required time shall result in the4
imposition of a fifty dollar penalty per violation ,. or as may be authorized by R.S.5
22:821. Any person against whom a penalty has been levied shall be given due6
notice of such action. Upon receipt of this notice, the licensee may apply for and7
shall be entitled to a hearing in accordance and compliance with Chapter 12 of this8
Title, R.S. 22:2191 et seq.9
* * *10
F. The license shall contain the licensee's name, city, and state of business11
address, personal identification license number, the date of issuance, the expiration12
date, and any other information the commissioner of insurance deems necessary.13
* * *14
§1704. Contract between public adjuster and insured15
* * *16
E. Prior to the signing of the contract, the public adjuster shall provide the17
insured with a separate disclosure document regarding the claim process that states:18
(1) Property insurance policies obligate the insured to present a claim to his19
insurance company for consideration. There are three types of adjusters that could20
be involved in that process. The definitions of the three types are as follows:21
(a) "Company adjusters" means the insurance adjusters who are employees22
of an insurance company. They represent the interest of the insurance company and23
are paid by the insurance company. The company adjuster Company adjusters shall24
not charge the insured insureds a fee.25
(b) "Independent adjusters" means the insurance adjusters who are hired on26
a contract basis by an insurance company to represent the insurance company's27
interest. They are paid by your insurance company. The independent adjuster28
Independent adjusters shall not charge the insured insureds a fee.29
* * *30 ENROLLEDHB NO. 283
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§1706. Standards of conduct of public adjuster1
* * *2
F. A public adjuster shall not solicit employment for or otherwise solicit3
engagement, directly or indirectly, for or on behalf of any attorney at law,4
contractor, or subcontractor, in connection with any loss or damage with respect to5
which such adjuster is concerned or employed. Nothing herein in this Part shall be6
interpreted to prevent a public adjuster from recommending a particular attorney,7
contractor or subcontractor; however, the public adjuster is prohibited from8
collecting any fee, compensation, or thing of value for such referral.9
* * *10
§1722. Definitions 11
As used in this Part: 12
(1) "Actuary" shall mean a person who is a member in good standing of the13
American Academy of Actuaries.14
(2) "Business entity" shall mean a corporation, association, partnership,15
limited liability company, limited liability partnership, or other legal entity.16
(2) (3) "Controlling person" shall mean any person , firm, association, or17
corporation who directly or indirectly has the power to direct or cause to be directed,18
the management, control, or activities of the reinsurance intermediary.19
(4) "Individual" shall mean a natural person.20
(3) (5) "Insurer" shall mean any person, firm, association, or corporation21
duly licensed in this state, pursuant to the applicable provisions of the Louisiana22
Insurance this Code, as an insurer. authorized insurer as defined in R.S. 22:46.23
(4) (6) "Licensed producer" shall mean an agent, broker, or a person24
licensed as an insurance producer pursuant to the provisions of Subpart A of Part I25
of this Chapter, R.S. 22:1541 et seq., or a person licensed as a reinsurance26
intermediary-broker licensed pursuant to the applicable provisions of the Louisiana27
Insurance Code. this Part.28
(7) "Person" shall mean an individual or business entity.29 ENROLLEDHB NO. 283
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(5) (8) "Reinsurance intermediary" shall mean a reinsurance intermediary-1
broker or a reinsurance intermediary-manager . as these terms are defined in2
Paragraphs (6) and (7) of this Section.3
(6) (9) "Reinsurance intermediary-broker" shall mean any person, other than4
an officer or employee of the ceding insurer, who solicits, negotiates, or places5
reinsurance cessions or retrocessions on behalf of a ceding insurer without the6
authority or power to bind reinsurance on behalf of such insurer.7
(7) (10) "Reinsurance intermediary-manager" shall mean any person , firm,8
association, or corporation who has authority to bind or manages all or part of the9
assumed reinsurance business of a reinsurer, including the management of a separate10
division, department or underwriting office, and acts as an agent for such reinsurer,11
whether known as a reinsurance intermediary-manager, manager, or other similar12
term. Notwithstanding the above, any previous provision of this Section, the13
following persons shall not be considered a reinsurance intermediary-manager, with14
respect to such reinsurer, for the purposes of this Part: 15
(a) An employee of the reinsurer.16
(b) A United States manager of the United States branch of an alien17
reinsurer.18
(c) An underwriting manager which, pursuant to contract, manages all the19
reinsurance operations of the reinsurer, is under common control with the reinsurer,20
subject to the Insurance Holding Company System Regulatory Law, R.S. 22:691 et21
seq., and whose compensation is not based on the volume of premiums written.22
(d) The manager of a group, association, pool, or organization of insurers23
which engage in joint underwriting or joint reinsurance and who are subject to24
examination by the state in which the manager's principal business office is located.25
(8) (11) "Reinsurer" shall mean any person , firm, association, or corporation26
duly licensed in this state, pursuant to the applicable provisions of the Louisiana27
Insurance this Code, as an insurer with the authority to assume reinsurance.28
(9) (12) "Qualified United States financial institutions" institution" shall, for29
purposes of this Part, mean an institution that: 30 ENROLLEDHB NO. 283
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(a) Is organized or licensed under the laws of the United States or any state1
thereof.2
(b) Is regulated, supervised, and examined by federal or state authorities3
having regulatory authority over banks and trust companies.4
(c) Has been determined by either the commissioner of insurance or the5
Securities Valuation Office of the National Association of Insurance Commissioners6
to meet such standards of financial condition and standing as are considered7
necessary and appropriate to regulate the quality of financial institutions whose8
letters of credit will be acceptable to the commissioner.9
(10) (13) "To be in violation" shall mean that the reinsurance intermediary,10
insurer, or reinsurer for whom the reinsurance intermediary was acting failed to11
substantially comply with the provisions of this Part.12
§1723. Licensure 13
A. No person, firm, association, or corporation shall act as a reinsurance14
intermediary-broker in this state if the reinsurance intermediary-broker maintains an15
office either directly or as a member , officer, director, or employee of a firm or16
association, or as an officer, director, or employee of a corporation: business entity:17
* * *18
B. No person, firm, association, or corporation shall act as a reinsurance19
intermediary-manager: 20
* * *21
(2) In this state, if the reinsurance intermediary-manager maintains an office22
either directly or as a member, officer, director, or employee of a firm or association,23
or as an officer, director, or employee of a corporation business entity in this state,24
unless such reinsurance intermediary-manager is a licensed producer in this state.25
* * *26
D.(1) The commissioner may issue a reinsurance intermediary license to any27
person, firm, association, or corporation who has complied with the requirements of28
this Part. Any such license issued to a firm or association business entity will29
authorize all the members, officers, and designated employers and directors of the30 ENROLLEDHB NO. 283
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firm or association and any designated employees business entity to act as1
reinsurance intermediaries under the license, and all such persons shall be named in2
the application and any supplements thereto. Any license issued to a corporation3
shall authorize all of the officers, and any designated employees and directors thereof4
to act as reinsurance intermediaries on behalf of such corporation, and all such5
persons shall be named in the application and any supplements thereto.6
(2) If the applicant for a reinsurance intermediary license is a nonresident,7
the applicant, as a condition precedent to receiving or holding a license, shall8
designate the commissioner as agent for service of process, to in the manner, and9
with the same legal effect, provided for by this Part for designation of service of10
process upon unauthorized insurers, and shall furnish the commissioner with the11
name and address of a resident of this state upon whom notices or orders of the12
commissioner or process affecting such nonresident reinsurance intermediary may13
be served. The licensee shall promptly notify the commissioner, in writing, of every14
change in its designated agent for service of process, and such change shall not15
become effective until acknowledged by the commissioner.16
* * *17
F. Licensed attorneys at law of this state, when acting in their professional18
capacity as such, shall be exempt from this Section. Part.19
§1724. Required contract provisions for reinsurance intermediary-brokers20
Any transactions between a reinsurance intermediary-broker and the insurer21
the broker represents in such capacity shall only be entered into be entered into only22
pursuant to a written authorization, specifying the responsibilities of each party. The23
authorization shall, at a minimum, provide that: 24
* * *25
(5) The reinsurance intermediary-broker will shall comply with the written26
standards established by the insurer for the cession or retrocession of all risks.27
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§1726. Duties of insurers utilizing the services of a reinsurance intermediary-broker1
A. An insurer shall not engage the services of any person , firm, association,2
or corporation to act as a reinsurance intermediary-broker on its behalf, unless such3
person is licensed as required by R.S. 22:1723(A).4
B. An insurer may not employ an individual who is employed by a5
reinsurance intermediary-bro ker with which it transacts business, unless such6
reinsurance intermediary-broker is under common control with the insurer and7
subject to the Insurance Holding Company System Regulatory Law., R.S. 22:691 et8
seq.9
* * *10
§1727. Required contract provisions for reinsurance intermediary-managers 11
A. Any transactions between a reinsurance intermediary-manager and the12
reinsurer represented in its capacity shall only be entered into be entered into only13
pursuant to a written contract, specifying the responsibilities of each party, which14
shall be approved by the board of directors of the reinsurer. At least thirty days15
before the reinsurer assumes or cedes business through the producer, a true copy of16
the approved contract shall be filed with the commissioner for approval. The17
contract shall, at a minimum, provide that: 18
(1) The reinsurer may terminate the contract for cause upon written notice19
to the reinsurance intermediary-manager. The reinsurer may immediately suspend20
the authority of the reinsurance intermediary-manager to assume or cede business21
during the pendency of while any dispute regarding the cause for termination. is22
pending.23
(2) The reinsurance intermediary-manager will shall render accounts to the24
reinsurer accurately detailing all material transactions, including information25
necessary to support all commissions, charges, and other fees received by, or owing26
to the reinsurance intermediary-manager, and remit all funds due under the contract27
to the reinsurer at least monthly.28
(3) All funds collected for the account of the reinsurer will shall be held by29
the reinsurance intermediary-manager in a fiduciary capacity in a bank which is a30 ENROLLEDHB NO. 283
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qualified United States financial institution as defined herein. The reinsurance1
intermediary-manager may retain no more than three months estimated claims2
payments and allocated loss adjustment expenses. The reinsurance intermediary-3
manager shall maintain a separate bank account for each reinsurer that it represents.4
(4) For at least ten years after expiration of each contract of reinsurance5
transacted by the reinsurance intermediary-manager, the reinsurance intermediary-6
manager will shall keep a complete record for each transaction showing: 7
* * *8
(7) The reinsurance intermediary-manager will shall comply with the written9
underwriting and rating standards established by the insurer for the acceptance,10
rejection, or cession of all risks.11
(8) Sets The contract sets forth the rates, terms, and purposes of commissions,12
charges, and other fees which the reinsurance intermediary-manager may levy13
against the reinsurer.14
B. If the contract permits the reinsurance intermediary-manager to settle15
claims on behalf of the reinsurer: 16
* * *17
(4) Any settlement authority granted to the reinsurance intermediary-18
manager may be terminated for cause upon the written notice by the reinsurer to the19
reinsurance intermediary-manager or upon the termination of the contract. The20
reinsurer may suspend such settlement authority during the pendency of the while21
any dispute regarding the cause of termination. is pending.22
C. If the contract provides for a sharing of interim profits by the reinsurance23
intermediary-manager, that such interim profits will shall not be paid until one year24
after the end of each underwriting period for property business and five years after25
the end of each underwriting period for casualty business, or for such longer period26
as may be specified by the commissioner, and not until the adequacy of reserves on27
remaining claims has been verified pursuant to R.S. 22:1729(C).28
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F. The reinsurance intermediary-manager will shall disclose to the reinsurer1
any relationship it has with any insurer prior to ceding or assuming any business with2
the insurer pursuant to the contract.3
* * *4
§1728. Prohibited acts 5
The reinsurance intermediary-manager shall not: 6
* * *7
(6) Jointly employ an individual who is employed by the reinsurer, unless8
such reinsurance intermediary-manager is under common control with the reinsurer9
subject to the Insurance Holding Company System Regulatory Law., R.S. 22:691 et10
seq.11
* * *12
§1729. Duties of reinsurers utilizing the services of a reinsurance intermediary-13
manager 14
A. A reinsurer shall not engage the services of any person , firm, association,15
or corporation to act as a reinsurance intermediary-manager on its behalf unless such16
person is licensed as required by R.S. 22:1723(B).17
* * *18
F. A reinsurer shall not appoint to its board of directors any officer, director,19
employee, controlling shareholder, or subproducer of its reinsurance intermediary-20
manager. This Subsection shall not apply to relationships governed by the Insurance21
Holding Company System Regulatory Law, R.S. 22:691 et seq. or, if applicable, the22
Business Transacted with Broker Producer Controlled Insurer Law., R.S. 22:551 et23
seq. 24
* * *25
§1731. Penalties and liabilities26
A. Any reinsurance intermediary, insurer, or reinsurer found by the27
commissioner, after a public hearing, to be in violation of any provision of this Part,28
shall:29
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(2) Be subject to revocation or suspension of its license. or certificate of1
authority.2
* * *3
§1741. Purpose4
The purpose of this Part is to provide for professional employment services5
by defining such services, requiring registration of persons or entities providing such6
services, providing for employee benefits plans and workers' compensation coverage7
for participants of such services, and providing for enforcement of this Part.8
* * *9
§1747. Licensure10
Every PEO engaged in the business of soliciting, selling, or negotiating11
policies of insurance shall be properly licensed in accordance with this Title. The12
PEO shall not hold itself out as an insurer, or insurance broker, or insurance agent;13
producer; offer any insurance service; or conduct any business that is defined or14
regulated in this Title unless appropriately licensed. No representative of a PEO15
shall make any comparative analysis or render advice regarding any insurance policy16
or coverage, including any health benefit plan or workers' compensation insurance,17
during the solicitation or sale of a professional employer services agreement or18
otherwise, unless properly licensed as an insurance agent or insurance broker19
producer in accordance with this Title.20
* * *21
§1761. Purpose22
This Part is to govern the qualifications and procedures for the limited23
licensing of motor vehicle rental or leasing companies to sell or offer insurance in24
conjunction with the rental of a vehicle as provided in this Part. This Part shall25
govern the transactions covered in this Part of selling travel or automobile-related26
products or coverage in connection with and incidental to the rental of vehicles.27
* * *28
§1763. Limited licensing; fees29
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B. As a prerequisite for issuance of a limited license under pursuant to this1
Part, there shall be filed with the commissioner a written application for a limited2
license, along with a five hundred dollar-application fee, signed by an officer of the3
applicant, in such form or forms, and supplements thereto, and containing such4
information as the commissioner may prescribe by rule or regulation. The5
application shall be accompanied by such fee as provided by R.S. 22:821. Every6
limited licensee shall, every two years, notify the commissioner of his intention to7
continue its license on forms provided by the commissioner and shall submit a8
renewal fee of two hundred fifty dollars. However, for a licensee who maintains9
twenty-five or less vehicles, the initial application fee shall be one hundred dollars10
and the renewal fee shall be fifty dollars. as provided by R.S. 22:821.11
* * *12
§1766. Authorized employees13
* * *14
C. The limited licensee shall keep a list of all persons who are authorized or15
who are selling insurance as provided in this Part. The list shall be provided to the16
commissioner within two weeks of written demand from the commissioner.17
§1767. Insurance charges18
Notwithstanding any other provision of this Part or any rule adopted by the19
commissioner, a limited licensee pursuant to this Part shall not be required to treat20
monies collected from renters purchasing such insurance when renting vehicles as21
funds received in a fiduciary capacity, provided that if the charges for coverage shall22
be itemized and be ancillary to a rental transaction. The sale of insurance not in23
conjunction with a rental transaction is prohibited by the provisions of this Part.24
§1768. Representations25
No limited licensee under pursuant to this Part shall advertise, represent, or26
otherwise hold itself or any of its employees or agents out as licensed insurers, or27
insurance agents, or insurance brokers. producers.28
Section 2. R.S. 22:1546(G) and (H), 1566, 1746(E), 1751, and 1769 are hereby29
repealed in their entirety.30 ENROLLEDHB NO. 283
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Section 3. The Louisiana State Law Institute is hereby directed to redesignate R.S.1
22:937 as R.S. 22:917.2
Section 4. This Act shall become effective on January 1, 2012.3
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: