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STATE OF OKLAHOMA
1st Session of the 58th Legislature (2021)
COMMITTEE SUBSTITUTE
FOR ENGROSSED
HOUSE BILL 2403 By: Russ of the House
and
Quinn of the Senate
COMMITTEE SUBSTITUTE
An Act relating to licenses and certificates;
amending 36 O.S. 2011, Section 1435.13, as amended by
Section 3, Chapter 294 , O.S.L. 2019 (36 O.S. Supp.
2020, Section 1435.13), which relates to the Oklahoma
Producer Licensing Act; requiring certain
notification before termination of certain license;
providing exemption; and providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 36 O.S. 2011, Section 1435.13, as
amended by Section 3, Chapter 294, O.S.L. 2019 (36 O.S. Sup p. 2020,
Section 1435.13), is amended to read as follows:
Section 1435.13. A. The Insurance Commissioner may place on
probation, censure, suspend, revoke or refuse to issue or renew a
license issued pursuant to the Oklahoma Produce r Licensing Act or
may levy a civil penalty in accordance with subsection D of this
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section or any combination of actions, fo r any one or more of the
following causes:
1. Providing incorrect, misleading, incomplete or materially
untrue information in the license application;
2. Violating any insurance laws, or violating any regulation,
subpoena or order of the Insurance Commis sioner or of another
state’s Insurance Commissioner;
3. Obtaining or attempting to obtain a license through
misrepresentation or f raud;
4. Improperly withholding, misappropriating or converting any
monies or properties received in the course of doing ins urance
business;
5. Intentionally misrepresenting the terms of an actual or
proposed insurance contract or ap plication for insuran ce;
6. Having been convicted of a felony;
7. Having admitted or been found to have committed any
insurance unfair trade pra ctice or fraud;
8. Using fraudulent, coercive , or dishonest practices, or
demonstrating incompetence, untrust worthiness or financi al
irresponsibility in the conduct of business in this state or
elsewhere;
9. Having an insurance producer license, or its e quivalent,
denied, suspended, censured, placed on probation or revoked in any
other state, province, district or territory;
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10. Forging another’s name to an application for insurance or
to any document related to an insurance transaction;
11. Improperly using notes or any other reference material to
complete an examination for an insurance license;
12. Knowingly accepting insurance business from an indiv idual
who is not licensed;
13. Failing to comply with an administrative or court order
imposing a child support obligation;
14. Failing to pay state income tax or comply with any
administrative or court order d irecting payment of s tate income tax;
15. Failing to respond to an inquiry from the Department as
required in Section 1250.4 of this title; or
16. Any cause for which an original issuance of a license could
have been refused.
B. 1. In the event that th e action by the Insur ance
Commissioner is to nonrenew or to deny an application for a license,
the Insurance Commissioner shall notify the applica nt or licensee
and advise the applicant or licensee, in writing, of the reason for
the denial or nonrenewal of the applicant’s or licensee’s license.
The applicant or licensee may make written demand upon the Insurance
Commissioner within thirty (30) days of the date of notification of
the notification by the Insurance Commissioner for a hearing before
the Insurance Commissioner or a n independent hearing e xaminer to
determine the reasonableness of the Insurance Commissioner ’s action.
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The hearing shall be heard within a reasonable time period and shall
be held pursuant to the Oklahoma Administrative Procedures Act .
2. The Insurance Department shall only te rminate a license
issued pursuant to the Oklahoma Producer Licensing Act that failed
to renew after a twelve-month inactive period upon notification by
first-class mail ninety (90) days prior to termination of the
license. The provisions of this subsection shall not apply to a
licensee that willfully and knowingly violates any provision of this
Code as to which refusal, suspension or revocation is mandatory.
C. The license of a business entity may be suspended, revoked
or refused if the Insurance Commissi oner finds, after opportunity
for hearing, that an individual licensee ’s violation was known or
should have been known by one or more of the partners, officers or
managers acting on behalf of the p artnership or corporation and the
violation was neither rep orted to the Insurance Commissioner nor
corrective action taken.
D. In addition to or in lieu of any applicable denial,
probation, censure, suspension or revocation of a license, a person
may, after opportunity for hearing, be subje ct to a civil fine of
not less than One Hundred Dollars ($100.00) nor more than One
Thousand Dollars ($1,000.00) for each occurrence. The penalty may
be enforced in the same manner in which civil judgments may be
enforced.
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E. Every licensee licensed purs uant to the provisions of the
Oklahoma Producer Licensing Act shall keep at the licensee ’s place
of business the usual and customary records pertaining to
transactions authorized by the license. All records as to any
particular transactions shall be kept available and open to t he
inspection of the Commissioner at any time during business hours
during the three (3) years immediately following the date of
completion of the transaction. The Commissioner may require a
financial or market conduct examination d uring any investigation of
a licensee. The cost of such examination shall be apportioned among
all of the appointing insurers of the licensee.
F. The Insurance Commissioner shall retain the authority to
enforce the provisions of and impose any penalty or remedy
authorized by the Oklahoma Producer Licensing Act and Title 36 of
the Oklahoma Statutes this title against any person who is under
investigation for or charged with a violation of the Oklahoma
Producer Licensing Act or Title 36 of the Oklahoma Stat utes this
title even if the person’s license or registration has been
surrendered or has lapsed by operation of law.
G. Files pertaining to investigations or legal matters which
contain information concurring a current and ongoing investigation
of allegations of violations of t he Oklahoma Insurance Code by a
licensed agent shall not be available for public inspection without
proper judicial authorization; however, a licensee under
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investigation for alleged violations of the Oklahoma Insurance Code,
or against whom an action for alleged violations of the Oklahoma
Insurance Code has been commenced, may view evidence and complaints
pertaining to the investigation, other than privileged information,
at reasonable times at the Commissioner’s office. All qualifi cation
examination materials, booklets and answers for any license
authorized to be issued by the Commissioner under any statute shall
not be available for public inspection. The residence address,
residence telephone n umber, birth date, and Social Security number
of a licensee shall not be available for public inspection. A
separate business or mailing address provided by the licensee shall
be considered a public record. If the residence and business
addresses or residence and business telephone numbers are the same,
such addresses or telephone numbers shall be considered a public
record.
H. The Commissioner shall promptly notify all appointing
insurers, where applicable, and the licensee regarding any censure,
suspension, revocation or termination of l icense by the
Commissioner.
I. Upon suspension, revocation or termination of the license of
a resident or nonresident of this state, the Commissioner shall
notify the Central Office of the National Association of Insura nce
Commissioners, or its appropriat e nonprofit affiliates and the
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Insurance Commissioner of each state for whom the Commissioner has
executed a certificate of licensure status.
J. The Commissioner may issue a duplicate license for any lost,
stolen or destroyed license issued pursuant to th e Oklahoma Producer
Licensing Act upon an affidavit of the licensee prescribed by the
Commissioner concerning the facts of such loss, theft or
destruction.
SECTION 2. This act shall become effective Novembe r 1, 2021.
58-1-2053 CB 4/5/2021 11:39:07 AM